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CHAPTER # 1

INTRODUCTION OF NATIONAL BANK OF PAKISTAN

1.1 Introduction:

National Bank of Pakistan (NBP) is one of the largest commercial bank operating in

Pakistan. It has modifies its role and has moved from a public sector organization into a

modern commercial bank. it continues to act as trustee of public funds and as the agent to

the State Bank of Pakistan (in places where SBP does not have a presence) it has

diversified its business portfolio and is today a major lead bank in the debt equity market,

retail and consumer banking, corporate investment banking, agricultural financing, treasury

services and is growing interest in promoting and developing the country's small and

medium enterprises and fulfilling its social responsibilities,

1.1.1 Head quarters and branches:

NBP headquarters is located in Karachi; NBP has over 1289 branches country wide with

total employees figured up to 16457. The bank provides both commercial and public sector

banking services.

National Bank of Pakistan is the largest commercial bank operating in Pakistan. Its balance

sheet size surpasses that of any of the other banks functioning locally. The Bank's services

are available to individuals, corporate entities and government. It has offloaded 23.2

percent share in the stock market, and while it has not been completely privatized like the

other three public sector banks, partial privatization has taken place. It is listed on the

Karachi Stock Exchange.

National Bank of Pakistan is today a progressive, efficient, and customer focused

institution. It has developed a wide range of consumer products, to enhance business and

cater to the different segments of society. Some schemes have been specifically designed

for the low to middle income segments of the population. These include NBP Karobar,

NBP Advance Salary, NBP Saiban, NBP Kisan Dost, and NBP Cash n Gold.

It has implemented special credit schemes like small finance for agriculture, business and

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industries, administrator to Qarz-e-Hasna loans to students, self employment scheme for

unemployed persons, public transport scheme. The Bank has expanded its range of

products and services to include Shariah Compliant Islamic Banking products. For the

promotion of literature, NBP recently initiated the Annual Awards for Excellence in

Literature. NBP will confer annual awards to the best books in Urdu and in all prominent

regional languages published during the defined period. Patronage from NBP would help

creative work in the field of literature. The Bank is also the largest sponsor of sports in

Pakistan. It has provided generously to philanthropic causes whenever the need arose.

It has taken various measures to facilitate overseas Pakistanis to send their remittances in a

convenient and efficient manner. In 2002 the Bank signed an agreement with Western

Union for expanding the base for documented remittances. More recently it has started

Electronic Home Remittances Project. This project introduces technology based system to

handle inward remittances efficiently, by ensuring that the Bank's branches keep a track of

the remittance received from abroad till its final receipt.

A number of initiatives have been taken, in terms of institutional restructuring, changes in

the field structure, in policies and procedures, in internal control systems with special

emphasis on corporate governance, adoption of Capital Adequacy Standards under Basel II

framework, in the up gradation of the IT infrastructure and developing the humanresources.

National Bank of Pakistan has built an extensive branch network with 1289 branches in

Pakistan and operates in major business centre abroad. The Bank has representative offices

in Beijing, Tashkent, Chicago and Toronto. It has agency arrangements with more than

3000 correspondent banks worldwide. Its subsidiaries are Taurus Securities Ltd, NBP

Exchange Company Ltd, NBP Capital Ltd, NBP Modaraba Management Company Ltd,

and CJSC Bank, Almaty , Kazakhstan. The Bank's joint ventures are, United National Bank(UK), First Investment Bank and NAFA, an Asset Management Company (a joint venture

with NIB Bank & Fullerton Fund Management of Singapore).

1.1.2 Financial performance:

The Bank's financial performance has been remarkable. In 2006, total assets are estimated

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at PKR 1,035,02 million, while deposits have grown to nearly PKR 832,152 million. Pre-

tax profit rose to PKR 24,415 million. Earnings per share have remained PKR 13.05 in

2010. The increase in profit was achieved through strong growth in core banking income.

Profit after tax in year 2010 was PKR 17,563 million which happened through growth in

the loan portfolio as well as increase in spreads. Advances in year 2010 were PKR 477,507

million. The Bank maintains a sound loan portfolio diversified in nature to counter the risk

of credit concentration

1.1.3 Awards:

Recently NBP has been awarded the Certificate for Performance by SBP/PRI for

providing best remittance services. The bank was awarded Bank of the Year award for

the year 2010. This award was given on the back of trust that clients have shown National

Bank has earned recognition and numerous awards internationally. It has been the recipient

of The Bank of the Year 2001, 2002, 2004 and 2005 Award by The Banker Magazine, the

Best Foreign Exchange Bank Pakistan for 2004, 2005, 2006 and 2007, Global Finance,

Best Emerging Market Bank from Pakistan for the year 2005, Global Finance, Kissan Time

Awards 2005 for NBP's services in the agriculture field. It is listed amongst the Region's

largest banks and also amongst the largest banks in South Asia 2005, The Asian Banker. It

has also been presented a Recognition Award 2004 for having a Gender SensitiveManagement by WEBCOP AASHA besides other awards.

1.1.4 Time line of history

The following time line gives a brief insight on the history o the national bank of Pakistan.

8 1949 National Bank of Pakistan (NBP) was established under the National Bank of

Pakistan Ordinance of 1949 and was government-owned. NBP acted as an agent of

the central bank wherever the State Bank did not have its own branch. It also

undertook government treasury operations. Its first branches were in jute growingareas in East Pakistan. Offices in Karachi and Lahore followed.

9 1950 NBP established a branch in Jeddah, Saudi Arabia.

10 1955 By this time NBP had branches in London and Calcutta.

11 1957 NBP established a branch in Baghdad, Iraq.

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12 1962 NBP established a branch in Dar-es-Salaam, Tanganyika.

13 1964 The Iraqi government nationalized NBP's Baghdad branch.

14 1965 The Indian government seized the Calcutta branch on the outbreak of

hostilities between India and Pakistan.

15 1967 The Tanzanian government nationalized the Dar-Es-Salaam branch.

16 1971 NBP acquired Bank of China's two branches, one in Karachi and one

at Chittagong. At separation of East Pakistan NBP lost its branches there. NBP

merged with Eastern Mercantile Bank and with Eastern Bank Corporation.

17 1974 The government of Pakistan nationalized NBP. As part of the concomitant

consolidation of the banking sector, NBP acquired Bank of Bahawalpur.

18 1977 NBP opened an offshore brain Cairo.

19 1994 NBP amalgamated Mehran Bank.

20 1997 NBP branch in Ashgabat, Turkmenistan commenced operations.

21 2000 NBP opened a representative office in Almaty, Kazakhstan.

22 2001 State Bank of Pakistan and Bank of England agree to allow only 2 Pakistani

banks to operate in the UK. NBP and United Bank agreed to merge their operations

to form Pakistan International Bank, of which NBP would own 45% and United

Bank 55%.

23 2002 Pakistan International Bank renamed itself United National Bank Limited

(UNB). The ownership structure of the UNB remained as before. The only change

to the shareholding structure is that UNB had recently been privatized in Pakistan

and was now owned 49% by the Government of Pakistan and 51% by a joint

foreign consortium of Abu Dhabi.

24 2003 NBP received permission to open a branch in Afghanistan.

25 2005 NBP closed its offshore branch in Cairo.

26 2010 NBP opened its branch in Karaganda (Kazakhstan).

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1.2 Organization Charts:

1.2.1 Overall Organization Structure:

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1.2.2 Staff Rank Organogram.

1.2.3 Organogram of departments

1.3 Department Functioning Under NBP

NBP has seven main departments for functioning of which whole function of bank is

depended or we can say that all services are rendered through these departments. These

department are explained with their headings are as under

1.3.1 Advance Department

Advance department receives the application from borrowers and after getting approval

from the head office advances are made. The advances can be of following nature.

27 Agriculture advance to farmers

28 Short terms advance to businessmen

29 Long term advance for setting industry

30 Medium term advance for working capital

31 Seasonal advance to cotton gingers rice and sugar mills.

1.3.2 Remittance Department

Remittance is the monitory transfer from one place to another place or from one country to

another country to fulfill the requirements of the customers by the order of the customer.

Remittance department at NBP main branch Dera Ismail Khan (0327) can be divided into

two sections due to its activities.

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32 Local remittance

33 Foreign remittance

Local remittance:

Local remittance section deals with remittance (incoming and outgoing but only in local

i.e., Pakistan rupee and within Pakistan.

Local remittance includes the following eight functions in NBP:

34 Transfer through pay order

35 Transfer through demand draft

36 Telegraphic transfer

37 Mail transfer

38 Local / internal transfer

1.3.3 Foreign Exchange Department

Imports

We sell our foreign exchange to the other country which is called such as we purchase the

foreign goods from the others. Import is done through letter of credit (l/c) by the importer.

Letter of credit is an undertaking given by the importer bank to the exporters bank.

Export

Export is to sell our goods to the other country and earn foreign exchange. The bank

provides facilities of exporting the commodities to the manufactures of the goods of the

country.

Foreign remittance

The bank provides the foreign remittance facilities to the student studying aboard. Bank

also provides foreign exchange in the shape of travelers cheques to the intending visitors

1.3.4 Clearing Department

Nearly all the banks provide a wide variety of services to their depositors. One valuable

service provided is that of clearing. Clearing department also plays an important role in

performing the activities of the bank.

The basic function of clearing department is to provide services to customers in collection

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of their cheques of other banks, whether they are in city or outside the city. The customer

can get the money in his account at NBP from the cheques drawn on another bank. The

bank accepts the cheque in the clearing which it is drawn through the clearing house i.e.,

state bank of Pakistan.

Clearing:

We can define clearing as, the transfer of funds from one branch of bank to the other

branch of the same bank or the other bank on which the instrument is drawn, without

involving cash through state banks clearing house or we can say in other that cheques

which cannot be cashed at the ash counter of the bank.

Clearing House:

It is of the service provided by central bank i.e, state bank of Pakistan to the other

commercial banks. SBP acts as a clearing house. A representative of each bank represents

his bank in the clearing house.

A clearing house is an association of commercial banks set up in a given locality for the

purpose of interchange & settlement of credit claims.

The SBP maintains the accounts of the NBP like other scheduled banks and debits the

account of the drawee bank and credits the presented bank which is NBP in that case.

NIFT:

NIFT: national institute of facilitation technologies is the body that helps in the fast completion of

the clearing process between the banks. The clearing services provided by NIFT are

39 Same day clearing

40 Overnight clearing

41 Local us dollar clearing

42 High value clearing etc

It collects cheques from the clearing department of the branches at a fixed time on daily bases and

then delivers it to the clearing house. And then deliver the cheques to recipient side of the

clearing on daily bases.

Types of cheque:

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Some specific types of cheque are being entertained in the clearing department of NBP

main branch, Dera Ismail Khan (0327).

These types of cheque are:

43 Local cheque

44 Out station cheque

45 In house cheque

Local cheque:

By local cheque we mean collection of cheque from the banks which are the members of

the clearing house and which are located within the city.

Out station cheque:

By out station cheque we mean collection of cheque from the banks which are situated

outside the city. It means that presenting bank and the bank on which the cheque is drawn

are not situated in the same city.

In house cheque:

In house cheque are drawn on one branch of NBP and presented to another branch of NBP

such cheques are marked with transfer stamp.

Types of clearing:

Clearing department deals with the two type of the clearance.

These are stated below:

46 Inward clearance

47 Outward clearance

Inward clearance:

Cheque drawn on NBP and presented to other banks or handed over to NBP agent in

clearing house. That is inward clearance for NBP. So inward clearing results in outflow of

funds to collecting bands reducing the balance in the clearing account.

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Outward clearance:

Similarly cheques which are drawn on other bank and presented to NBP main branch, Dera

Ismail Khan (0327) are known as outward clearance for NBP main branch. So outward

clearing results in inflow of funds from paying bank into the clearing account maintained

with clearing house increasing the balance in the clearing account.

Outward clearing thus may be:

48 Local clearing

49 Outstation clearing

Excess of outward clearing over inward clearing produces a net increase in the clearing

account balance. The excess of inward clearing over outward produces a net decrease in the

clearing account balance. The first case is referred to as favorable clearing & the second

case as unfavorable clearing.

1.3.5 Cash Dealing Department

Cash department of NBP is given the complete responsibility of handling all receipts &

disbursement of cash. As a result of transaction in both local & foreign currencies & near

cash items such as traveler cheque etc (when they are issued against cash). As a

consequence it is also responsible for the book keeping of these transactions & the safe

custody of cash & near cash securities of NBP.

50 Cash receipts for receive deposits.

51 Encashment of cheque

Cash department of NBP is a separate close part covered with glasses. No one other than

cash departments employee is allowed to enter into that area.

Cash receipt:

The depositor uses cheque deposit slip (or cash deposit slip) for depositing the amount.

There are two types of cash deposit slip:

52 For current account holders

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53 For saving account holder

Both are in different colors for clear identification.

Acceptance of cheque:

The cash is paid against the cheque of the client. The following points are kept in mind

while receiving the cheque from the client.

54 Cheque should be drawn on NBP.

55 It should not be post dated.

56 It should be bearer cheque so the word bearer should not be crossed.

57 Payment is not stopped by the drawer.

58 Amount in words & figure should be same.

59 Alternation in date / figure / word require drawers full signature with signature on

the cheque.

Affirmation of signatures:

After receiving the cheque the officer verifies the signature of the account holder with the

signature on the cheque. It signatures are not the same then it is returned back otherwise

forwarded to computer terminal.

Computer terminal process:

The cheque is received in computer terminal, where the computer operator checks the

balance of the account holder. The operator also sees whether the stop payment instructions

are received from account holder or not. After considering these two points computer

operator posts the cheque in account holder ledger & returns the cheque back to the officer.

Payment of cash:

The cheque is cancelled after posting & is returned to cashier. The cashier enters the

cheque in cash paid register & pays against the second signature of the receiver on the

back of the cheque.

1.3.6 Account Opening Department:

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Basically function of a/c opening & closing in NBP is performed under accounts

department but i am discussing it with separate heading for better understanding.

Firstly all types of accounts which can be opened in NBP have been described:

Types of accounts:

60 Current account

61 Saving account

Brief explanation of these accounts is as follows:

Current accounts:

Current a/c is basically used to meet the daily transactions. Current account provides safety

to the customers money, gives the advantage for paying debts by the convenient and safe

means of sending cheques through the post thus avoiding the trouble and loss that units in

pkr, us$ gbp and dm.

Saving account

In case of saving accounts, account holder gets profit. There is a time limit for drawing

cash; customer cannot draw money before a certain time. In NBP saving a/c is used as

current a/c & there is no main difference between current & saving account except profit.

This account can be opened by limited company, Partnership Company, club societies &

associations, joint & sole proprietorship.

How to open an account (general):

When a person intends to open account, a card is filled & signed by customer. This card

contains:

62 Six boxes for name.

63 Opening date

64 Special instructions

65 Space for first a/c no.

66 Space for other accounts.

Following points are considered by the bank in this regard.

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67 Another account holder of the bank should properly introduce the new customer.

68 The account holder should sign the account opening form in the presence of bank

officer and the signature is duly verified.

69 A copy of identity card is required by bank.

70 Against submission of the banks prescribed application form, duly introduced in

the manner provided and on supplying such document, as may be required and

account may be opened. The bank reserves to itself the right to refuse to open and

account without assigning any reason.

71 Each account shall be allotted a distinct number that is to be quoted in all

correspondence with the bank relation to the account.

The bank reserves the right to change the above mentioned minimum balance

requirement at any time without any notice.

Procedure to open an account:

When a customer wants to open an account, the bank officer gives application form to him.

All information, which is necessary to be known by the bank, is requirements of the

application form. From also requires the essential documents to be attached by the

customer.

Following persons can open an account:

72 Sole proprietors

73 Private accounts

74 Joint account

75 Limited company

76 Partnership company

77 Club, society & association

Basically following information is required:

78 Name79 Address

80 Telephone no.

81 Currency of account

82 Nature of business

83 Residential status

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84 Special instruction regarding the account

85 Signature of the applicant

Documents to be attached:

Documents required to be attached are different for different categories.

Sole proprietors account

86 They have to submit their business registration certificate number.

Private accounts

For individual or private accounts following documents & information has to be given:

87 Name

88 Residence address

89 Mail address

90 Foreign address

91 Office address & office ph. No.

92 Position to title

93 Passport or identification no/

94 Matrimonial status

95 Date and place of birth

96 Nationality

97 Residence visa no.

98 Name and address of other banks in Pakistan

Joint account

If someone wants to open joint account the following information is needed:

99 Full name

100Address

101Specimen of signatures of the joint account holders

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Joint company

In this case following information & documents are required:

102Certified true copy of the memorandum and articles of association of the company.

103Certified true copy of the resolution of the board of directors / managing committee

/ governing body regarding conduct of the account.

104Certified list containing names and signatures of the directors / office bearers.

105Certified true copy of the certificate of incorporation or registration.

106Certified true copy of the certificate of commencement of business ( in case of

public limited companies).

107I.d. card copy of each director

108Original is also enclosed for inspection and return

109List of persons authorized to operate on the account.

Partnership company account

Documents required in this case are as follows:

110Full names

111Address

112Specimen of signatures of the partners

113Certified true copy of partnership deed

Societies / clubs and association account

Documents required in this case are as follows:

114Copy of the rules certified by the president and the secretary.

115Certified copy of a resolution of the committee and the specimen signatures of the

persons authorized to sign.

Issuance of cheque book:

Bank issues first cheque book through a procedure which is on the opening of an account

bank mails a letter of thanks to the address of the account holder with an envelope attached

with the letter, account holder signs the letter and posts it back to the bank. After receiving

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signed letter bank issues the first cheque book.

Chapter # 2

Personal Working and learning

Work Done By Me at the Branch:

Major activities performed or observed during my internship program are as follows;

2.1 Account Opening Department:In this department, I gain the practical knowledge about opening account. This department

deals with opening current and saving account for its customers and all matters regarding

thereof. The customers opening current and saving accounts can be categorized as

following.

116Individual

117Firm

118Company

119Trust

120Staff

121Others

Opening an Account:

In order to open an account, first of all the customers have to fill a form prescribed by the

bank. The person is required to bring some reference or introduction for opening the

account. Introducer may be the person who has any account with NBP. Some important

information regarding introducer e.g. the name and account number of the introducer is

written on the space provided on the specimen signature card. Then in order to find out

whether he is a true introducer or not, a letter is sent to him thanking him for this

introduction so that anything wrong may come into notice.

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There are different requirements for different types of accounts and accountholders.

Deposits:

The procedure undertaken upon receiving deposits from the customers is as follows:

122Examining the deposit slip to ensure that the name and the account

numbers are clearly indicated.

123Counting the cash and cheques and agree the total with the amount on the deposit

slip.

124After that the pay in slip is validated for cash transaction and transfer and clearing

transfer as appropriate before the counterfoil is handed over to the customer.

125Cheques signed by directors, partners or employees of a company, drawn in favor

of them and credited in their account in the bank are to be scrutinized.

.

2.2 Clearing Department:

In this department, I have worked for two weeks. Main branch receives the cheques from

all of its branches and makes the lots of these cheques again. Main branch sends these

cheques to the state bank of Pakistan where a clearinghouse exits. In this clearinghouse the

representatives receive their cheques and go back to their bank's main branch. Then the

main branch sends these cheques to their relevant branches where the validity of these

cheques is verified and the accounts of the relevant clients are affected.

The statement of clearing was submitted before 1.00 P.M. daily. The whole procedure of

clearing is completed within two days.

Effect:

Excess of outward clearing over inward clearing produces a net increase in the clearing account

balance. Excess of inward clearing over outward clearing produces a net decrease in the clearing

account balance. The first case is considered as favorable clearing & the second case as

unfavorable clearing.

In Clearing Department I Did Following Tasks

126 Filling up the vouchers

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127 Record keeping of cleared cheques

128 Reporting the objections

129 Recording of the cheques which were returned due to any objection

2.3 Remittances Department:

I worked in this department for one week. This department deals in transfer of money from

one place to another or country by:

130Demand drafts

131Mail transfer

132Telegraphic transfer

In this department internees are advised only to observe the working of transfer of money

from one place to another place of the country by the above modes of transferring money.

During my stay in this department I observed that how demands draft be issued. The

procedure is as follows.

First the bank receives a written request from the customer to issue a bank draft. The

written request is either in banks standard form or separate paper signed by the applicant

enclosed with cash or cheques covering the amount of the draft and other charges of the

bank.

While issuing a bank draft it is necessary that the draft should be free from alternations.

All the details must be written clearly in ink. After issuance a demand draft it is handed

over to the applicant and its advice containing the particulars of the draft is sent to drawer

branch with its necessary information and payment of the draft is make on its presentation.

2.4 Advances Department:

I worked and gained knowledge in advances department for a week and I focused on the

Gold Demand Finance and Running Finance. In this regard I performed following tasks:

133Examining prerequisites for the loan i.e. documentation

134Filled the forms

135Examining the jewelers valuation

136Examined the post requisites.

137Record keeping

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Documents required for Gold Demand Finance:

There are several documents which are necessary to get loan under running finance which

are as follows:

138Borrowers CNIC

139Two nominees CNIC

140Jewelers valuation of ornaments

141Managers approval letter

Characteristics of Running Finance:

142Unlikely demand finance (gold demand finance) running finance includes

installments facility.

143The customer has the drawing power which means he can draw amount from his

account as much as he required at any time during the given time frame/

144It is secured financing

145Stock is pledged by the bank as security in which following requirements are

fulfilled before lending.

146Stock valuation is done by the bank and advances are made accordingly. The stock

valuation can be done through following ways

o Invoices

o Quotations

o Actual bills

147In stock pledge the title remains with the customer but possession goes to the bank.

Verifications for Advancements:

Regarding advances in the bank I observed that how bank undertakes some verification

related to the customer and his business so that the risk may be avoided as much as

possible? The verifications are done by the bank through some institutes. Through these

institutes bank observes customer credit history, other loans taken by the customer, and

customers profile.

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These institutes are:

148Electronic credit information bureau (ECIB)

149International credit information limited (ICIL)

150NADRA (verisys)

Default Criteria:

Bank has its own criteria on which customer are observed that whether the customer is

making repayments in with in due time or becoming default. This criterion tells that if:

151Customer does not return the amount for 3 months than bank considers it as

substandard and 25% of the loan is considered as bad debts

152Customer does not return the amount for 6 months than bank considers it as doubt

full and 50% of the loan is considered as bad debts

153Customer does not return the amount for 9 months than bank considers it as

complete loss and 100% of the loan is considered as bad debts

2.5 Cash Department

In cash department I worked for a week. I observed that department is responsible for the

receipt and disbursement of cash from and to the customers. It is also responsible to the

disbursement and receipt of cash equivalents like prize bonds etc.

Dealing with cash as mentioned above inculcates other responsibility that is to perform the

book keeping of the record related to the safe custody of cash and cash equivalents.

154Cash receipts for receive deposits.

155Encashment of cheque

Cash department of NBP is a separate close part covered with glasses. No one other than

cash departments employee is allowed to enter into that area.

Cash Receipt

The depositor uses cheque deposit slip (or cash deposit slip) for depositing the amount.

There are two types of cash deposit slip:

For current account holders &

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For saving account holders.

Both are in different colors for clear identification

Acceptance of Cheque

The cash is paid against the cheque of the client. The following points are kept in mind

while receiving the cheque from the client.

156Cheque should be drawn on NBP.

157It should not be post dated.

158It should be bearer cheque so the word bearer should not be crossed.

159Payment is not stopped by the drawer.

160Amount in words & figure should be same.

161Alternation in date / figure / word require drawers full signature with signature on

the cheque.

Verification of Signatures: After receiving the cheque signature of the account holder

with the signature on the cheque is verified. If signatures are not the same then it is

returned

Computer Terminal Process The cheque is received in computer terminal, where the

computer operator checks the balance of the account holder. The operator also sees whether

the stop payment instructions are received from account holder or not. After considering

these two points computer operator posts the cheque in account holder ledger & returns the

cheque back to the officer.

Payment of Cash The cheque is cancelled after posting & is returned to cashier. The

cashier enters the cheque in cash paid register & pays against the second signature of the

receiver on the back of the cheque.

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Chapter # 3

Organizations SWOT and Branch Level Weaknesses and Area of Improvement

SWOT Analysis

SWOT analysis is an acronym that stands for strengths, weakness, opportunities, and

threats. SWOT analysis is careful evaluation of an organizations internal strengths and

weakness as well as its environment opportunities and threats. The overall evaluation of a

company strengths, weaknesses, opportunities and threats is called SWOT analysis. SWOT

analysis is one of the most important steps in formulating strategy using the organization

mission as a context, managers assess internal strengths distinctive competencies and

weakness and external opportunities and threats. The goal is to then develop good

strategies and exploit opportunities and strengths neutralize threats and avoid weaknesses.

The SWOT analysis of NBP is briefly explained below

6.1 STRENGTHS:

There are several strengths NBP is enjoying like:

GOVERNMENTS BANK

NBP has a major strength that support its business up to much extent that is, it is

governments own bank and is the only bank of government of Pakistan working in

consumer banking industry.

OLDEST INSTITUTION:

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NBP in one of the oldest bank of Pakistan and first nationalized bank Hence its customer

base is strength from this plus point as customers have more confidence in the bank. The

additional value services as the privilege for the bank.

ALTERNATE DUTIES IN SBP ABSENCE

The NBP performs additional services for its customers as well as the other bank customer

in the absence of SBP.

MORE DEPOSITS THAN OTHER BANK

NBP has the relative competence in having more deposits than the other bank. This is

because of the confidence the customer have in the bank. The bank being the privileged

and oldest bank in banking sector of Pakistan enjoys this edge over all others, lacking it.

EMPLOYEE BENEFITS

The employers at NBP are offered reasonable monetary benefit. Normally two bonuses are

given Eid-Ul-Fitar & Eid-Ul-Azha. This serves as an additional benefit and competency for

the bank and a source of motivation for the employees.

BROAD NETWORK

The bank has another competency i.e. it has broad-basses network of branches throughout

the country also more than one branch in high productive cities. The customers are

provided services at their nearest possible place to confirm customer satisfied.

RELATION BETWEEN STAFF AND OTHER EMPLOYESS

The bank enjoys a good plus point when it comes to the employee manager relationship the

hearing as removing of discrepancies if any, between the employees, and between the

manager and employees.

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6.2 WEAKNESSES

LACK OF MARKETING EFFORT:

The bank does not promote its corporate image, services, etc on a competitive way. Hence

lacks far behind in marketing effort .A need for aggressive marketing in there in the era

marketing in now becoming a part of every organization.

NBP UNDER POLITICAL PRESSURE

The strong political hold of some parties and government and their dominance is affecting

the bank in a negative way. They sometime have to provide loan under the pressure, which

leads to uneven and adjusted feeling in the bank employees.

FAVORITISM AND NEPOTISM

The promotions and bonuses etc in the bank are often powered by seniors favoritism or

depends upon their wills and decision. This adds to the negative factors, which denominate

the employees thus resulting in affecting their performance negatively.

INEFFICIENT COUNTER SERVICES IN THE RUSH HOURS

During the rush hours, the bank is founded out to be a total flop to handle the mob of

people peaking from windows and doors. The bank has deficiency to operate in the stages

of rush hours where the people find them services entangled in a situation of nowhere

because they are not well served.

LACK OF MODERN EQUIPMENT

The bank lacks the modern Equipment that is currency notes counting machine computers.

Even if there is any equipment they lack to fall in the criteria of being rearmed as update

and upgraded

UNEVEN WORK DISTIBUTION.

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The workload in NBP is not evenly distributed and the workload tends to be more on some

employees while others abscond away from their responsibilities, which server as a de-

motivational factor for employees performing above average work.

6.3 OPPORTUNITIES

ELECTRONIC BANKING

The world today has become a global village because of advancement in the technologies,

especially in communication sector. More emphasis is now given to avail the modern

technologies to better the performances. NBP can utilize the electronic banking opportunity

to ensure on line banking 24 hours a day. This would give a competitive edge over others.

MICRO FINANCING

Because of the need for micro financing in the market, there are lot of opportunities in this

regard. Other banks have already initiated, now the time has arrived when the NBP must

realize it and take on step to cater an ongoing demand.

6.4 THREATS

ENTRY OF NEW COMPETITORS

The bank is facing threats with the emergence of new competitors especially in terms of

foreign banks. These foreign banks are equipped with heavy financial power with excellent

and innovative ways of promoting and performing their services. The bank has to take

initiative in this regard or will find itself far back in competition.

POLITICAL PRESSURE BY ELECTED GOVERNMENT

The ongoing shift in power in political arena in the country effects the performance of the

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bank has to forward loans to politically powerful persons which create a sense of insecurity

and demoralization in the customer as well as employees.

DOWNSIZING

The bank is currently acting upon the policy of downsizing which threaten the environment

of the bank Employees feel insecurity in doing their jobs and work, hence affecting the

overall performance of employees negatively.

CUSTOMERS COMPLAINTS

There exists no regular and specific system of the removal of customer complaints. Now a

day a need for total customer satisfaction is emerging and in their demanding consequences

customer's complaints are ignored

3.1 Weaknesses of National Bank of Pakistan (at Main Branch D, I, Khan 0327)

During my internship in National Bank of Pakistan Main Branch D. I. khan I observed

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many shortfalls and weaknesses which I am mentioning in this chapter. Before mentioning

these shortfalls two main things, which I think must be clear that:

162These weaknesses are at the branch level not as a whole as National Bank of

Pakistan.

163These weaknesses are observed by me at the branch. The management of the

organization may be of opposite opinion regarding my observations

The weakness and shortfalls are:

164Sitting Arrangement of The Staff

The sitting arrangement of the staff at branch is not proper and creates difficulty in the

movement of the staff which causes wastages of the time and reduces performance.

165Bad Customer Management

Due to absence of the customer relationship skills in the employees at the counter and poor

work management in the branch customers have to wait for longer time for the process of

their requirement which ultimately reduces customer satisfaction.

166Uneven Distribution of Work

The distribution of the work among the employees is not properly done by the bank which

reduces job satisfaction and performance of the employees.

167Job Description is Not Being Observed

The tasks which are being performed by the employees at the branch are not according to

the job description of the specific designation/post thats why errors and discrepancies are

accruing in the work.

168Bad Communication With In The Branch

Communication within the employees whether it is vertical or horizontal, is not up to the

mark. Communication is not timely and not clear which arises many problems during the

work.

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169Noisy Environment At The Workplace

There exists a noisy environment in the branch which occurs due to the employees because

they communicate to each other whether it is regarding their work or apart from the work,

by sitting on their seats without moving to the concerned person. So in this situation

loudness is required which disturbs the work of other employees at the branch.

170Weak Professional Behavior In The Employees

The way employees communicate at the work place, the way they handle the situation, the

way they deal with the customers, found to be unprofessional which is harming the

perception of the bank.

171Poor Safety of Vault.

During my internship I found that vaults safety in not being held as per the rules and

regulations of the bank. I observed that unconcerned persons are allowed to enter in the

vault this in future may become the reason of the loss or may arise some related issues.

172Fewer Space With In The Branch

The branch where I accomplished my internship is the Main Branchand is quite a busy

branch that is why the number of employees is also large. To accommodate all employees

and to provide a reasonable space to each of them seemed to be impossible as the space in

the branch is very small. This results in the disturbance and damage the working

environment.

173 Less Space For Car Parking

As I mentioned earlier that the branch where I did my internship is very busy branch

regarding task and customer visits, so there must be sufficient area for the parking of

vehicles but branch is lacking this facility

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174 Easy Access Of The People To The Back Side Of The Counter

During internship I found that unconcerned people have easy access towards the

employees side of the counter and there were no prohibitive measures which were being

taken by the bank as this practice may harm the bank by in the shape of loosing important

files and many more.

175Unavailability Of Telephone Operator

Another big problem I observed in the branch was that there was no telephone operator in

the bank. Due to this issue many calls were picked by the unconcerned employees which

results in the wastage of the time of employees and at the branch and also at the place

where the call is made.

176Long Lunch And Prayer Breaks

Time allocated for the lunch and prayer breaks is more than the requirement which is the

wastage of the time and customers suffer a lot due to this practice.

177Absence Of The Employees During The Office Hours

The break time is already very long along with this another issue is that the employees

found to be absent form their seat during the working hours which disturbs the work of

other employees as well as wastage customers have wait for the completion of their work.

178Less Qualified Employees

Some of the employees working in the branch instead of having huge experience, are less

qualified thats why they take long time to adopt the frequently changing of policies and

procedures of the bank

3.2 Area of Improvement in National Bank Of Pakistan Main Branch D I Khan:

The following are the two area where in my opinion improvement is extremely required in

this competition era in the banking sector of the Pakistan and which must be addressed on

urgent basis by the management of National bank of Pakistan.

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3.2.1 Marketing:

In my observation, the area where improvement must be done by the management of

national bank of Pakistan is the marketing sector of the bank. During my internship at the

main NBP Main Branch D I khan, I observed, and that the area where branch is lacking far

behind is the marketing area of the bank. If we look in the modern age banking, marketing

plays a key role in the success of the branch and then ultimately of the organization as a

whole so management must look in to it to gain the success. To overcome this weakness

there must be a separate department at the branch level.

3.2.2 Customer Management:

Another area where improvement is extremely required is the customer management at the

branch level. The branch where I did internship, customer management was below the

standard. Customer has to wait for long time for the fulfillment of their queries which

creates dissatisfaction among the customers regarding services provided by the bank.

Chapter # 4

Recommendations and Suggestions

4.1 Recommendations and Suggestions:

My recommendations and suggestions about NBP main branch D. I. Khan are on the basis

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of the shortfalls and weaknesses which I found in the branch. These recommendations are

as follow:

179Sitting arrangement of employees in the branch must be made proper so that

movement of employees and customers can be made smooth and easy to avoid the

disturbance wastage of time.

180Branch is lacking in the good customer management due to the absence of skills in

the employees. Bank should give training to the employees to overcome this

problem. This training can be given on the job or off the job.

181The work at the branch is distributed unevenly which reduces the performance level

of employees. To avoid this issue management should remain confined to the job

description which will increase the job performance.

182Communication in the branch is not up to the mark, it must be made up to the mark

so that work may be done quickly and problems are avoided.

183The environment in the branch found to be very noisy which is caused by the

employees this is due to unavailability of telephone extensions for the employees.

This can be avoid by giving the extension lines to the employees.

184Employees are lacking in the professional behavior which ultimately causes

enormous problems. Employees must be given training to enhance professional

behavior.

185Vault is the most important and valuable part of the bank. Branch is lacking in the

providing security to the vault as per the set standards of the banking regulations.

Rules and regulations must be observed in the security of vault strictly.

186The main NBP Main Branch D. I. Khan is very busy branch regarding customer

visits and employees but the space in the branch is less to accommodate employees

and customers. To avoid this issue the covered are of the branch must be enhanced.

187The branch is very busy due to the visit of the customers but the parking area is

very small to accommodate the rush of vehicles. Parking area must be enhanced so

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that customers may not face parking problems.

188Unconcerned persons found to be visiting back side of the counter which is a bad

practice. This issue should be resolved to avoid related problems. This can be done

by using grills and glass walls.

189Branch must have a telephone operator so that the calls can be transferred to the

concerned department which will reduce the wastage of time.

190The lunch and prayer break timing should be reduced and strictly be followed to

avoid the wastage of time.

Conclusion:

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After brief and comprehensive discussion I may safely conclude that the bank overall

performance is quite good and is working quite effectively and efficiently. If I have to

express my experience of internship in National Bank of Pakistan, I can say thatNational

Bank of Pakistan is a good Organization for internship purposes because most of the

employees especially those who are hired through MTO employment program, are willing

to teach the internees. Overall working environment of the bank is quite good. Behavior of

senior executive of bank is very polite and they are caring about the individuals career and

their growth. Employees hired as MTO in the branch are look like banking professionals

along with old employees who have experiences but have less education, but overall they

are productive for the organization.

As far as my learning is concerned; most of the employees at branch were quite

cooperative. They helped me to understand the activities of a bank to possible extent. Their

good attitude gave me more confidence to learn more and to ask if I have any confusion in

my mind. Besides their ever busy schedule they never get disturbed by my questioning. In

the end I may say that National bank is a good place for internship because NBP is the

leading commercial bank in the country and has large range of services and financial

products which inculcates huge knowledge for internees.

References

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191National Bank of Pakistan Annual report 2010

192National bank of Pakistan Directors Report 2010.

193A. Arshad, (personal communication 07-07-2011)

194A. Akhtar. (personal communication 18-07-2011)

195http://www.nbp.com.pk

196http://www.nbp.com.pk/products.php

197http://www.nift.com.pk/intro.html

198http://www.wikipedea.com/nationalbankofpakistan