1. Executive Summary
This report is based on internship in National Bank of Pakistan branch name. It is a
famous and reputed bank of Pakistan. National Bank of Pakistan maintains first
position in banking sector in Pakistan. This report is based on the activities which are
performed in this bank. This report contains marketing analysis, competitive analysis,
SWOT analysis, bank tariffs and exchange rates of National Bank of Pakistan. There
are also stated the activities which I performed during my internship in the branch. In
this report also discuss the industry analysis of banking system in Pakistan. There are
also mentioned the way of investment, rates of investment, all types of financing and
loans facilities the National Bank of Pakistan provides. The problems in this branch
are also discussed. This report also intimates about the daily reserves which are
required by the branch to meet the need of its daily transactions.

　
　

2.1. Mission Statement

To be recognized in the market place by Institutionalizing a merit & performance

culture, Creating a powerful & distinctive brand identity, Achieving top-tier financial
performance, and Adopting & living out our core values.

　
　

2.2. Core Values

2.2.1. We aim to be an organization that is founded on…

• Growth through creation of sustainable relationships with our

customers.

• Prudence to guide our business conduct.

• A national presence with a history of contribution to our communities.

2.2.2. We shall work to…

• Meet expectations through Market-based solutions and products.

• Reward entrepreneurial efforts.

• Create value for all stakeholders.

2.2.3. We aim to be peopling who…

• Care about relationships.

• Lead through the strength of our commitment and willingness to excel.

•Practice integrity, honesty and hard work. We believe that these are
measures of true success.

2.2.4. We have confidence that tomorrow we will be…

 • Leaders in our industry.

• An organization maintaining the trust of stakeholders.

• An innovative, creative and dynamic institution responding to the

changing needs of the internal and external environment

2.3. Vision

To be the pre-eminent financial institution in Pakistan and achieve market recognition

both in the quality and delivery of service as well as the range of product offering

　
　

2.4. Senior management

Masood Karim Shaikh SEVP & Group Chief, Corporate & Investment Banking
Group

Shahid Anwar Khan SEVP & Group Chief, Commercial & Retail Banking Group

Dr. Asif A. Brohi SEVP & Group Chief, Operations Group

Muhammad Sardar Khawaja SEVP & Group Chief, Audit & Inspection Group

S. M. Rafique SEVP & Secretary Board of Directors

Imam Bakhsh Baloch SEVP & Group Chief, Compliance Group

Ziaullah Khan SEVP & Group Chief, Special Assets Management Group

Amim Akhtar EVP & PSO to the President

Javed Mehmood EVP & Group Chief, Risk Management Group

Muhammad Nusrat Vohra EVP & Group Chief, Treasury Management Group

Nadeem A. Dogar EVP & Group Chief, Information Technology Group

Dr. Mirza Abrar Baig EVP & Group Chief, Human Resources Management &
Administration Group

Mrs. Khurshid Maqsood Ali EVP & Divisional Head Employee Benefits,
Disbursements & Trustee Division

Tahir Yaqoob EVP & Group Chief, overseas Coordination & Management Group

Mrs. Uzma Bashir Group Chief, Organization Development & Training Group
Syed Farhan Ahmed Financial Controller & Divisional Head Financial Control
Division

2.5. Corporate and financial reporting framework

(Code of Corporate Governance)

The board is fully aware of its responsibilities established by the Code of Corporate
Governance issued by the Securities & Exchange Commission of Pakistan (SECP).
They are pleased to give the following declarations/statements to comply with the
requirements of the Code.

1. The financial statements (Balance sheet, Profit and Loss Account,

Cash Flow Statement, Statement of Changes in Equity and notes forming
part thereof), prepared by the management of the bank give the
information required by the Companies Ordinance, 1984 in the manner
so required and respectively give a true and fair view of the state of the
bank's affairs as at December 31, 2002 and of the results of its
operations, changes in equity and its cash flows for the year then ended.

2. Proper books of accounts have been maintained.

3. Appropriate accounting policies have been consistently applied in the

preparation of the financial statements and accounting estimates are
based on the reasonable and prudent judgment.

4. Approved Accounting Standards have been followed in preparation of

the financial statements and there is no departure from the said
standards.

5. The system of internal control is sound in design and has been

effectively implemented and monitored throughout the year. The Board
is responsible for establishing and maintaining the system of internal
control in the bank and for its ongoing monitoring. However, such a
system is designed to manage rather than eliminate the risk of failure to
achieve objectives, and provide reasonable but not absolute assurance
against material misstatements or loss.

The process used by the Board to review the efficiency and effectiveness of the
system of internal control includes, the following:
 • The Board has formed an audit committee comprising of three non
executive directors. The audit committee has written terms of reference
in the form of a charter, which has been approved by the Board of
Directors. The committee is responsible for the oversight of the internal
audit function and reviews its approach and methodology from time to
time. It also receives and reviews the internal and external audit reports
relating to the internal control, accounts and related matters. The
committee on a continuous basis reviews the material control
weaknesses and areas of concern and actions to be taken by the
executive management to address these issues.

• Internal audit department of the bank conducts the audit of all

branches, regions and groups at head office level on ongoing basis to
evaluate the efficiency and effectiveness of internal control system and
proper follow up of irregularities and control weaknesses is carried out.

• The Board receives confirmations/representations from all group and

regional heads on annual basis confirming effectiveness of the internal
control system established and maintained by them within their function.

The principal features of the bank's control framework include:

• The bank has clearly defined organizational structure which supports

clear lines of communications and reporting relationships.

• There exists a properly defined financial and administrative power of

various committees and key management personnel, which supports
delegation of authority and accountability.

• The bank has effective budgeting system in place. Annual budget of

the bank is approved by the Board and monthly comparisons of actual
results with the budget are prepared and reviewed by the senior
management.

The bank has a comprehensive framework of written policies and procedures on all
major areas of operations such as Credit, Treasury Operations, Finance, Internal audit
and Compliance approved by the Board.

• There are no significant doubts about the bank's ability to continue as a

going concern.
 • There has been no material! Departure from the best practices of the
corporate governance as detailed in the listing regulations.

• Key operating and financial data is available in the annual report.

• The number of board meetings held during the year were 14 and
attended by the directors as follows:

Syed Ali Raza 14

Dr. Waqar Masood Khan 10

Kamran Y. Mirza 8

A. Razzak Tabba 12

Rizwan A. Kehar 12

Qazi Faez Issa 10

Sheikh Humayun Sayeed 12

•Book value of investments of Employees' Pension Fund as at

December 31, 2002 (un-audited) is Rs. 6,317.705 million.

• The pattern of shareholding as required by the code is as follows:

Associated companies, undertakings and related parties Total No. of

shares held

Taurus Securities Limited 2,015

National Bank of Pakistan Trustee Department -NIT 1,009,842

Investment Corporation of Pakistan 1,519,095

16 Overseas Branches
4 Representative Offices
1 Subsidiary
1 Joint Venture

　
　

29 Regional Offices
1,189 Branches
130 Online Branches
4 Subsidiaries

2.6. Overseas Branches

2.6.1. America and Europe Region

USA

Canada

Germany

France

2.6.2. Far East Region

Hong Kong

Japan

South Korea

China

2.6.3. Middle East, Africa & South Asia Region

Bahrain

Egypt

Bangladesh

EPZ

2.6.4. Central Asian Republics

Afghanistan

Turkmenistan

Kyrgyz Republic

Kazakhstan

Uzbekistan

Azerbaijan

2.7. Domestic Branches

2.7.1.Sind

Dadu/ Sanghar

Hyderabad

Jacobabad/ Shikarpur

Karachi

Larkana

Mirpurkhas/ Badin

Nawabshah/ N' Feroze

Sukkur/ Khairpur

Tharparkar

2.7.2. Punjab

Bahawalpur

D.G. Khan/ RYKhan

Faisalabad

Gujranwala
Sialkot/ Narowal

Islamabad

Jhang

Jhelum/ Gujrat/ Chakwal

Lahore

Multan/ Baha'nagar

Murree/ Attock/ Gilgit

Rawalpindi

Sahiwal

Sargodha/ Sheikhupura

2.7.3. NWFP

Abbottabad/ Mansehra

Bannu/ D.I. Khan

Kohat / Mingora

Mardan

Peshawar

2.7.4. Baluchistan

All Branches

2.7.5. Azad Kashmir

Muzaffarabad

Mirpur

　
　

2.8. NBP Student Loan Scheme

Pursuant to the announcement made by the Federal Finance Minister in his 2001-2002
budget speech, aSTUDENTS LOAN SCHEME (SLS) for Education was launched
by the Government of Pakistan in collaboration with major commercial banks of
Pakistan (NBP, HBL, UBL, MCB and ABL). Under the Scheme, financial assistance
is provided by way of Interest Free Loans to the meritorious students who have
financial constraints for pursuing their studies in Scientific, Technical and
Professional education within Pakistan.

The Scheme is being administered by a high powered committee comprising Deputy

Governor, State Bank of Pakistan, Presidents of the commercial banks and Deputy
Secretary, Ministry of Finance, Government of Pakistan.

• The objective of the Students Loan Scheme is to provide financial assistance to

the meritorious students of insufficient means who have obtained 70% marks in the
last public examination and are unable to pursue their studies within Pakistan due to
financial difficulties.

• Loans facility is available to those students who are nationals of Pakistan including
Northern Areas, Federally Administered Tribal Areas and Azad Jammu and Kashmir
and of age not exceeding 20 years for graduation, 30 years for post-graduation and 35
years for PhD at the time of admission.

• The maximum period of repayment of loan is 10-Years from the date of

disbursement of first installment .The borrower shall repay the loan in monthly
installment after six months from the date of first employment or one year from the
date of completion of studies, which ever is earlier

• Loan is granted only to those students who have been admitted to the approved
under noted Affiliated Colleges /Universities.
• Under the Scheme, loans are available in the following subjects.

Engineering

Electronics

Oil Gas & Petro-Chemical Technology

Agriculture

Medicine

Physics

Chemistry

Biology, Molecular Biology & Genetics

Mathematics

Other Natural Sciences

DAWA and Islamic Jurisprudence (LL.B/LL.M Sharia)

Computer Science/Information System and Technology

including hardware.

Economics, Statistics and Econometrics

Business Management Sciences

Commerce

• The facility under this Scheme is restricted to the studies in the above-mentioned
subjects only or such other subjects as may be approved by the Apex Committee from
time to time.
• The amount of loans under the Scheme covers the cost of fee, books and boarding
for the entire period of study.
• Schedule Fee and boarding expenses excluding meal charges is disbursed directly to
the University/College.
• The amount of procurement of textbooks is disbursed directly to the student.
• The students desirous of availing loan under the Scheme may apply on prescribed
Form for financial assistance subject to he or she has got admission on merit through
normal procedure in the Universities/ Colleges afore-mentioned.

• Application Forms are available from the designated branches.

• Applicants are required to submit/send their applications duly completed in all
respect, to the designated branches indicated against Universities/ Colleges.

• Those students who have already availed this facility last year need not to apply.

3. SERVICES
3.1.

DEMAND DRAFTS

If you are looking for a safe, speedy and reliable way to transfer money, you can now
purchase NBP’s Demand Drafts at very reasonable rates. Any person whether an
account holder of the bank or not, can purchase a Demand Draft from a bank branch.

3.2. SWIFT SYSTEM

The SWIFT system (Society for Worldwide Inter bank Financial Telecommunication)
has been introduced for speedy services in the area of home remittances. The system
has built-in features of computerized test keys, which eliminates the manual
application of tests that often cause delay in the payment of home remittances. The
SWIFT Center is operational at National Bank of Pakistan with a universal access
number NBP-APKKA. All NBP overseas branches and overseas correspondents
(over 450) are drawing remittances through SWIFT.

Using the NBP network of branches, you can safely and speedily transfer money for
your business and personal needs.

3.3. LETTERS OF CREDIT

NBP is committed to offering its business customers the widest range of options in the
area of money transfer. If you are a commercial enterprise then their Letter of Credit
service is just what you are looking for. With competitive rates, security, and ease of
transaction, NBP Letters of Credit are the best way to do your business transactions.

3.4. TRAVELER'S CHEQUES

3.4.1. Negotiability:

Pak Rupees Traveler’s Cheques are a negotiable instrument

3.4.2. Validity:

There is no restriction on the period of validity

3.4.3. Availability:

At 700 branches of NBP all over the country

3.4.4. Encashment:

At all 400 branches of NBP

3.4.5. Limitation:

No limit on purchase

3.4.6. Safety:

NBP Traveler’s Cheques are the safest way to carry our money

3.5. PAY ORDER

NBP provides another reason to transfer customer’s money using their facilities.
Their pay orders are a secure and easy way to move customer’s money from one place
to another. And, as usual, their charges for this service are extremely competitive.

3.5.1. Issuance of Pay order

1. for NBP Account Holder

Rs. 50/- (Flat)

2. for NBP Non-Account Holder

Rs. 100/- (Flat)

Rs. 25/- (Flat) from student for payment of fee favoring educational institution

3.5.2. Issuance of duplicate Pay order

1. for NBP Account Holder

Rs. 100/- (Flat)

2. for NBP Non-Account Holder

Rs. 150/- (Flat)

3.6. MAIL TRANSFERS

Move your money safely and quickly using NBP Mail Transfer service. And they
also offer the most competitive rates in the market.

3.7. FOREIGN REMITTANCES

To facilitate its customers in the area of Home Remittances, National Bank of

Pakistan has taken a number of measures to:

• Increase home remittances through the banking system

• Meet the SBP directives/instructions for timely and prompt delivery of

remittances to the beneficiaries

3.7.1. New Features:

The existing system of home remittances has been revised/significantly improved and
well-trained field functionaries are posted to provide efficient and reliable home
remittance services to nonresident Pakistanis at 15 overseas branches of the Bank
besides Pakistan International Bank (UK) Ltd., and Bank Al-Jazira, Saudi Arabia.

• Zero Tariffs: NBP is providing home remittance services without any

charges.
 • Strict monitoring of the system is done to ensure the highest possible
security.

• Special courier services are hired for expeditious delivery of home

remittances to the beneficiaries.

3.8. SHORT TERM INVESTMENTS

NBP now offers excellent rates of profit on all its short term investment accounts.
Whether you are looking to invest for 3 months or 1 year, NBP’s rates of profit are
extremely attractive, along with the security and service only NBP can provide.

3.8.1. National Income Daily Account (NIDA)

The scheme was launched in December 1995 to attract corporate customers. It is a

current account scheme and is part of the profit and loss system of accounts in
operation throughout the country.

3.8.2. Effective 23rd December 2004

National Income Daily Account (NIDA)

Slab Rate

Rs. 2 Million & above but below Rs. 25 Million 1.00 %

Rs.25 Million & above but below Rs .50 Million 1.10 %

Rs.50 Million & above but below Rs.100 Million 1.30 %

Rs.100 Million & above but below Rs. 250 Million 1.50 %

Rs.250 Million & above but below Rs. 500 Million 1.75 %

Rs.500 Million & above but below Rs. 1000 Million 2.00 %

Rs.1000 Million & above but below Rs. 2000 Million 2.25 %

Rs.2000 Million & above but below Rs. 5000 Million 2.50 %

Rs.5000 Million & above 2.75 %

3.9. EQUITY INVESTMENTS

NBP has accelerated its activities in the stock market to improve its economic base
and restore investor confidence. The bank is now regarded as the most active and
dominant player in the development of the stock market.

3.9.1. NBP is involved in the following:

• Investment into the capital market

• Introduction of capital market accounts (under process)

NBP’s involvement in capital markets is expected to increase its earnings, which

would result in better returns offered to account holders.

3.10. COMMERCIAL FINANCE

Let them help make your dreams become a reality

Their dedicated team of professionals truly understands the needs of professionals,

agriculturists, large and small business and other segments of the economy. They are
the customer’s best resource in making NBP’s products and services work for them.

3.11. TRADE FINANCE OTHER BUSINESS LOANS

3.11.1. AGRICULTURAL FINANCE

3.11.2. CORPORATE FINANCE

3.11.1. AGRICULTURAL FINANCE

NBP provides Agricultural Finance to solidify faith, commitment and pride of farmers
who produce some of the best agricultural products in the World.

Agricultural Finance Services:

“I Feed the World” program, a new product, is introduced by NBP with the aim to
help farmers maximize the per acre production with minimum of required input.
Select farms will be made role models for other farms and farmers to follow, thus
helping farmers across Pakistan to increase production.
Agricultural Credit:

The agricultural financing strategy of NBP is aimed at three main objectives:-

• Providing reliable infrastructure for agricultural customers

• Help farmers utilize funds efficiently to further develop and achieve

better production

• Provide farmers an integrated package of credit with supplies of

essential inputs, technical knowledge, and supervision of farming.

Agricultural Credit (Medium Term):

• Production and development

• Watercourse improvement

• Wells

• Farm power

• Development loans for tea plantation

• Fencing

• Solar energy

• Equipment for sprinklers

Farm Credit:

NBP also provides the following subsidized with ranges of 3 months to 1 year on a
renewal basis.

• Operating loans

• Land improvement loans

• Equipment loans for purchase of tractors, farm implements or any

other equipment
 • Livestock loans for the purchase, care, and feeding of livestock

Production Loans:

Production loans are meant for basic inputs of the farm and are short term in nature.
Seeds, fertilizers, sprayers, etc are all covered under this scheme.

3.11.2. CORPORATE FINANCE

Working Capital and Short Term Loans:

NBP specializes in providing Project Finance – Export Refinance to exporters – Pre-

shipment and Post-shipment financing to exporters – Running finance – Cash Finance
– Small Finance – Discounting & Bills Purchased – Export Bills Purchased / Pre-
shipment / Post Shipment Agricultural Production Loans

Medium term loans and Capital Expenditure Financing:

NBP provides financing for its clients’ capital expenditure and other long-term
investment needs. By sharing the risk associated with such long-term investments,
NBP expedites clients’ attempt to upgrade and expand their operation thereby making
possible the fulfillment of their clients’ vision. This type of long term financing
proves the bank’s belief in its client's capabilities, and its commitment to the country.

Loan Structuring and Syndication:

National Bank’s leadership in loan syndicating stems from ability to forge strong
relationships not only with borrowers but also with bank investors. Because they
understand their syndicate partners’ asset criteria, they help borrowers meet
substantial financing needs by enabling them to reach the banks most interested in
lending to their particular industry, geographic location and structure through
syndicated debt offerings. Their syndication capabilities are complemented by their
own capital strength and by industry teams, who bring specialized knowledge to the
structure of a transaction.

Cash Management Services:

With National Bank’s Cash Management Services (in process of being set up), the
customer’s sales collection will be channeled through vast network of NBP branched
spread across the country. This will enable the customer to manage their company’s
total financial position right from your desktop computer. They will also be able to
take advantage of NBP outstanding range of payment, ejection, liquidity and
investment services. In fact, with NBP, you’ll be provided everything, which takes to
manage your cash flow more accurately.

3.12. INTERNATIONAL BANKING

National Bank of Pakistan is at the forefront of international banking in Pakistan

which is proven by the fact that NBP has its branches in all of the major financial
capitals of the world. Additionally, NBP have recently set up the Financial Institution
Wing, which is placed under the Risk Management Group. The role of the Financial
Institution Wing is:-

• To effectively manage NBP’s exposure to foreign and domestic

correspondence

• Manage the monetary aspect of NBP’s relationship with the

correspondents to support trade, treasury and other key business areas,
thereby contributing to the bank’s profitability

• Generation of incremental trade-finance business and revenues

3.13. NBP offers:

• The lowest rates on exports and other international banking products

• Access to different local commercial banks in international banking

3.14. EXCHANGE RATES

Rate Sheet

Treasury Management Group

September 1, 2006

Country Selling Buying sight 203/2006

U.S.A 59.85 59.65 59.53 Rates for Currency Notes & TCs

U.K 110.18 109.82 109.55 Selling Buying

EURO 74.76 74.51 74.41 U.S.A 60.45 58.94

CANADA 50.22 50.06 49.92 SAUDI ARABIA 16.12 15.71

SWITZERLAND 48.45 48.29 48.16 U.K 111.29 108.46

AUSTRALIA 45.87 45.72 45.60 JAPAN 0.5528 0.5386

SWEDEN 8.04 8.01 7.99 EURO 75.51 73.67

JAPAN 0.5474 0.5455 0.5441

NORWAY 9.54 9.51 9.49

SINGAPORE 35.73 35.61 35.52 Libor for Calculating Interest on Special USD Bonds

DENMARK 10.03 9.99 9.97 Libor Value

SAUDI ARABIA 15.96 15.91 15.86 6 Moths USD 3.9963 06-Sep-05

HONGKONG 7.70 7.68 7.66 Interest Rates on Old FCY Deposits

CHINA 7.41 7.39 7.37 For 3 Months & Over but Less then 6 Months

KUWAIT 204.97 204.28 203.74

MALAYSIA 15.89 15.84 15.80 USD 0.1000

NEWZEALAND 42.42 42.27 42.16 GBP 0.1000

QATAR 16.45 16.39 16.35 JPY 0.0000

U.A.E 16.30 16.24 16.20

KR. WON 0.0584 0.0582 0.0581

THAILAND 1.459 1.454 1.450

Conversion rates for Frozen FC Deposits, DBC/FCBC, Special USD Bond

USD GBP EUR JPY

59.7163 110.3677 74.9917 0.5484

　
Bill Buying Rates per Unit of Currency
　
30 Days 60 Days 90 Days 120 Days 150 Days 180 Days

USD L/C 59.41 59.16 58.91 58.66 58.40 58.14

GBP L/C 109.24 108.71 108.18 107.66 107.14 106.63

EUR L/C 74.29 74.08 73.87 73.66 73.45 73.25

　

　
　

3.15. SWOT Analysis

3.15.1. Strengths

Western union facility:

National Bank of Pakistan is only one bank which has the facility of Western union.
In this particular scheme money is transfer in Pakistan from abroad. This is the fastest
way to money transfer. You can receive the money from bank to see the name and
password of particular client.

ATM finder:

There is also strength of NBP that they are found the ATM. They now provide this
facility to the customers.

Government’s bank:

In commercial banking system NBP is only the government bank. They make their
policies according to the government’s rules and regulations. It enjoys its position in
the market of banking system in Pakistan. Government of Pakistan also facilitating the
National Bank of Pakistan.

Customer satisfaction:

Because of government’s bank, it is enjoying the customer’s satisfaction. Customers

feels secure their money in NBP.

Online banking:
There is also strength of NBP that 130 branches are online. It helps the speedy
services giving to the customers. There is also help in checking the balances and daily
transactions just at one key press.

Employee’s loyalty:

Employees are very much loyal to NBP. Employee’s turnover is very low in NBP.
Very few employees are leaving the jobs in NBP. So it is very big strength that your
employees are loyal to your organization.

Wide area of services:

They provide the wide area of services. They offer no. Of services relating to the
banking system like, pension to retired government employees, traffic challans, fees
received of AIOU, farms of AIOU, utilities bills, deposits, sales tax , withholding tax,
property tax, and various loan schemes.

3.15.2. Weakness

Lack of communication between employees:

During the internship in NBP I found the problem of lack of communication between
the employees and management. They have not very much understanding with each
other and not share the work of each other.

Punishment is not very strong for employees:

Punishment threat is not very strong for employees. Some employees are not very
professional in their field but top management not takes the action against such
employees.

Public dealing is not very effective:

Public respect is not very effective in NBP. Employees are not taking care of the
customers, especially in pension and bills department.

Staff shortage:

There is also weak point for NBP that staff is very short and more staff is required to
meet the needs of the branch work. They help from internees.

Lack of respect of seniors:

They are not a healthy sign for NBP that respect of seniors is not up to the manners.

Juniors try to avoid the seniors and no take the help from them.

3.15.3. Opportunities

Growing banking system:

Nowadays banking system is growing quickly so NBP have opportunities to improve

the standard and get the more share in the market.

NBP have government back:

In growing era there is a chance for NBP to improve itself and increase the shares in
the market because it is most trustable due to government’s bank.

Increase in economic activities:

The economic activities are increase nowadays, so banks are contributes more in
economic activities. Banks are played role in trade and commerce. So the business of
commercial banks is increase.

3.15.4. Threats

Increase in no. of banks:

Increase in no. of banks is a threat for National Bank of Pakistan. No. of private banks
(commercial and private) are operating their business and provide the same facilities.
So increase in no. of banks is a threat for NBP.

Modern type of banking:

Modern and computerized banking is required to fulfill the customer’s need. So

maximum branches of NBP are worked in old traditional ways.

Highly skilled people and management required to meet the new

standard of banking. In NBP some employees are totally irresponsible
and lack of complete knowledge of banking system. So these employees
are creating continuous problems in the system of NBP.

The whole structure change to online :

NBP have wide network of branches. Only 130 branches are online, so it is very
difficult and time consumed to convert all branches to online system. So there is also
risk involves that if one commuter of one branch suffers in problem, all system and all
commuters of all branches must be turnoff.

4. Performance Analysis
4.1. Financial Performance

In 2002, NBP increased its pre-tax profit to Rs. 6,045 million from Rs. 3,016 million
in 2001, an increase of over 100%. The improved profitability was achieved due to a
combination of higher interest revenue, enhanced fee income and run off of the
amortization of the 1997 Golden Handshake Scheme. Prudent addition to loan loss
reserves was made which continues to improve the cash coverage for non-performing
loans.

All key financial and operating ratios demonstrated improvement. Cost/ income ratio
was 0.44 (excluding one off provision of Rs. 832 million for benevolent fund and Rs.
513 million for charge for special separation package) as against 0.52 of the last year.
Pre-tax return on equity was 45.27% as compared to 25.85% of the current year and is
impressive by any yardstick. Pre-tax return on assets improved to 1.43% as against
0.77% of last year. Capital adequacy ratio of the bank is 14.5%, which is 38% higher
as compared to 10.52% of last year.

Deposits of the bank increased by Rs. 12 billion. While there was increase in private
sector loans due to adjustment / repayment of loans by large public sector entities and
substantially lower commodity operations borrowings, advances decreased by Rs. 30
billion.

4.2. Industry analysis

Banking is one of the most sensitive businesses all over the world. Banks play
very important role in the economy of a country and Pakistan is no exemption.
Banks are custodian to the assets of the general masses. The banking sector
plays a significant role in a contemporary world of money and economy. It
influences and facilitates many different but integrated economic activities like
resources mobilization, poverty elimination, production and distribution of
public finance. It is purchase of car or building of a home banks are always
they’re to serve you better. It is play ground or any educational or healthy
societal activities the money of banks nurtures them. It is an industrial project
or agricultural development of the country the sponsor-ship of banks is very
much involved. Banks play very positive and important role in the overall
economic development of the country.

Pakistan has a well-developed banking system, which consists of a wide variety of

institutions ranging from a central bank to commercial banks and to specialized
agencies to cater for special requirements of specific sectors. The country started
without any worthwhile banking network in 1947 but witnessed phenomenal growth
in the first two decades. By 1970, it had acquired a flourishing banking sector.

4.2.1. Comparative Study of Domestic Banking Industry

Nationalization of banks in the seventies was a major upset to domestic banking

industry of the country, which changed the whole complexion of the banking industry.
With irrational decision at the top all the commercial banks were made subservient to
the political leadership and the bureaucracy. Specialized banking institutions were
already working in the public sector. The new accountability paradigm changed the
business ethics in the banking industry, and with this change started the disaster.
Nationalization of banking industry was accompanied by violent changes in the
external value of rupee. The commercial banks thus lost their assets management
equilibrium, initiative and growth momentum. They ceased to be a business concern
and became big bureaucracies. This was accompanied by indiscreet loaning under
political pressure. They suffered from three terminal diseases: non-performing loans;
higher intermediation cost; and loss of initiative and entrepreneurship. The rise to
Labor Unions and Officers Associations made life tough and working conditions ugly
to honest, dedicated and industrious workers in the realms of domestic banking
industry.

The era of nineties was the climax of privatization, deregulation and

restructuring in the domestic banking industry and financial institutions. The
Muslim Commercial Bank was the first bank to privatize. Followed by Allied
Bank limited, United Bank Limited and now the Habib Bank Limited have
been privatized. One thing good for that particular period was the recruitment
of fresh officers in the domestic banking industry through well-organized
policies of Banking Council. With the decay of Banking Council there was
flood of insincere, nonprofessional, incompetent candidates directly appointed/
recruited in all the domestic banks of the country.

4.2.2. Public Sector Commercial Banks

National Bank of Pakistan NBP

First Women Bank Limited FWB
The Bank of Khyber KB
The Bank of Punjab BOP

The government of Pakistan permitted small private sector banks to operate, which
indulged in doubtful policies to promote business. The public sector banking, which
constituted the backbone, thus continued to suffer because of their approach, size and
carried over liabilities. Mehran Bank is the prime example of that kind of lax banking
in the country, which ultimately merged into National bank of Pakistan i.e. last resort
of domestic banking industry.

4.2.3. Local Private Banks

Askari Commercial Bank Limited

Bank Al-Falah Limited
Bank Al Habib Limited
Bolan Bank Limited
Faysal Bank Limited
Metropolitan Bank Limited
Platinum Commercial Bank Ltd
Prime Commercial Bank Limited
Saudi Pak Commercial Bank Ltd
PICIC Commercial Bank Limited
Soneri Bank Limited
Union Bank Limited
Muslim Commercial Bank Limited
Allied Bank of Pakistan
Union Bank Limited
Mashreq Bank

In the meanwhile, western banks started entering into the business. They, with the
support of ruling elite, concentrated on the big business, leaving the routine business
to the local banks. This reduced the profitability of the local banks.

4.2.4. Foreign Banks

ABN Amro Bank

Al Baraka Islamic Bank
American Express
The Bank of Tokyo Mitsubishi
CITI Bank
Credit Agricole Indo Suez
Deutsche Bank
Doha Bank
Emirates Bank
 Habib Bank A. G. Zurich
Hong Kong Shangai Banking
Corporation
IFIC
Mashreq Bank PJSC
Oman Bank
Rupali Bank
Standard Chartered Bank

4.2.5. Specialized Banks

Zari Tarqiati Bank Ltd.

Industrial Development Bank of Pakistan
Punjab Provincial Cooperative Bank
Limited

There are 17 listed banks in Pakistan 2004. Four banks are still not listed, which are
Habib Bank, United Bank, Allied Bank of Pakistan, Dawood Bank. Standard
Chartered Bank, Citibank, Deutsche Bank and ABN AMRO Bank are main foreign
banks in the country. These four banks continue to enjoy a significant share in the
market, both in terms of deposits and advances. All the foreign banks of the country
are busy to invest heavily in the field technology and e-commerce in order to
overcome branch limitation. All the foreign banks have been busy to introduce new
products and idea to grab larger proportion of the local markets. Foreign banks are
carrying major proportion of local business in credit cards, consumer finances and
housing finance.

Many domestic banks have increased their general standards. Ours is the age of plastic
money. Internet-based services are constantly increasing the number of ATM
machines, either by installing their own machines or making arrangements with other
networks. The number of Debit Cards has also been increasing at an unprecedented
rate

All the domestic and foreign banks vigorously institutionalized consumer financing in
the country and earned handsome profits. The borrowing to private sector has also
increased which ultimately boasted the profitability of all the domestic banks of the
country. In the last 3 to 4 years many domestic banks have been suffering from
surplus liquidity crisis mainly due to low demand for credit and slowdown of
manufacturing sector in the country. Almost all the banks are now buy to invest in
capital markets to increase their exposure in equities. To stop that risky trend the State
Bank of Pakistan issued the instructions to follow the Prudential Regulations in letter
and spirit and not invest in the capital markets beyond the limits. The domestic bank’s
lending under consumer finance and housing finance has also been growing. The
analysis of Annual Reports of banks shows that their income from core banking
activities has been growing. The other positive point is that there are growing
expectations for increase in interest rates.

The growth in advances has started matching growth in deposits. The quality of asset
as well liability products have been improving. The ratios of non-performing loans
have decreased. The SBP29 Scheme has benefited the banks as well as the borrowers
to pay-off their long-standing dues. Bank Alfalah is the first to opt for the listing
policy of the government and also offered its share to general public. Two of the state-
owned banks, Habib Bank and United Bank, have been privatized.

Allied Bank of Pakistan was privatized in early nineties. But due to many internal and
external reasons it continues to suffer. Some meaningful senior managerial changes
would be better at the earliest. Dawood Bank has recently emerged on the banking
scenario of Pakistan and it is good addition. The bank has come into existence as a
result of acquisition of Pakistan operations of a Sri Lankan bank by a local business
group. It is also not listed at the local stock exchanges. Meezan Bank is the first bank
of the country, which is carrying complete Islamic banking.

4.3. Comparative Analysis

Comparative Analysis of Domestic Banking Industry of Pakistan

(Rs. million)

Bank Deposit Advances Investments

ACB 51,732 30,035 26,759

BAH 34,240 23,775 18,831

Bop 23,767 6,621 8,295

BB 7,761 3,298 1,328

FB 24,554 21,935 6,842

UNION BANK 328,182 167,523 142,877

KB 2,640 490 2,118

MB 5,079 3,532 856

Metro 28,515 19,444 15,013

MCB 182,706 78,924 89,610

NBP 362,866 140,547 143,525

PCB 21,155 10,876 10,306

PB 14,640 9,016 7,534

SPB 12,341 8,522 6,365

SB 20,545 11,378 9,844

UB 37,760 28,890 11,822

UBL 154,915 74,117 69,385

4.4. Marketing Analysis

4.4.1. Market Recognition

For the second consecutive year, NBP was recognized as the best bank in Pakistan by
the prestigious periodical, “The Banker" UK (a subsidiary of Financial Times Group).
Furthermore M/s JCR-VIS Credit Rating Company Limited maintained its rating of
AAA, while the standalone rating was raised by one notch to AA-, which is one of the
highest in the banking sector.

4.4.2. Future Outlook

The reduction in the interest rate environment will overall have a negative impact on
the financial sector's profitability in the short term. To meet these challenges we will
focus on building our loan portfolio, both on corporate and retail side. On the retail
side focus will be on additional fee business while maintaining stringent controls over
cost. Longer term we will be focusing on those sectors in the country, which have
traditionally received less attention from the financial sector, i.e. agriculture, small
and medium enterprises and of the entire range of retail products. Our key strength
remains our customer base of over 9 million and we are confident that we are
positioned to capitalize on the opportunities.

5. BANK CHARGES EFFECTIVE FROM 01.01.2006

5.1. INTERNATIONAL BANKING

ANNUAL VOLUME

5.1.1. IMPORTS. DURING A CALENDAR

YEAR Ist Qtr. Each Sub.Qtr Minimum

LETTER OF CREDIT. Or part or part amount

thereof thereof. Per L/C

a. Opening of cash Letters of Credit. a. Upto Rs.20 (M) 0.40% 0.20% Rs.1, 000/-

b. Upto Rs.50 (M) 0.35% 0.20%

c. Upto Rs.100 (M) 0.30% 0.20%

d. Up to Rs.250 (M) 0.25% 0.20%

e. Up to Rs.500 (M) 0.20% 0.15%

f. Up to Rs.1, 000 (M) 0.15% 0.10%

g. Above Rs.1, 000 (M) 0.10% 0.05%

Note.

1. Projected Annual Volume is to be ascertained and got approved by the Competent

Authority Commitment letter from customer for paying difference in commission
arising out of short fall in business commitment.
2. L/C commission for the increased liability should also be recovered for un-expired
L/C period. In case, liability increases (due to exchange rate fluctuation) by virtue of
providing forward cover to the customer after opening of L/C.

b. Revalidation Commission.

On expiry of L/C when the same is revalidated, revalidation commission should be

recovered as is applicable for opening of Fresh Letter of Credit, as in ( i-a ) above.
L/C commission will be calculated on the amount of liability as per exchange rate
prevailing on the date of revalidation

c. Transfer Commission.

When a Letter of Credit is transferred to a new beneficiary, transfer commission

should be charged as applicable in case of Fresh Letter of Credit as in ( i-a) above.

d. Approval from SBP for re-import of Consignment back to Pakistan. Rs.2,

000/- (Flat) per case.

e. L/C Cancellation Charges Rs.1, 000/- (Flat) Plus actual telex charges

.a. Non-reimbursable Letter of Credit under Barter/Aid/Loan and authorization to Pay.

1% on 1st quarter and 0.30% for each subsequent quarter or part thereof Minimum of
Rs.2, 000/-

b. L/C under Suppliers/Buyers Credit, “Pay as you Earn Scheme” and Deferred
payment L/Cs for period of one year.

Commission @ 0.40% per quarter or part thereof (at the time of opening of L/C, it is
to be charged on full amount of L/C liability plus interest payable thereon for the
period from the date of opening of L/C till the expiry of L/C, thereafter commission is
to be recovered on six monthly basis on outstanding/reducing liability as per revised
Schedule of Charges applicable on that date.) In case forward cover is provided
against L/C under Suppliers/Buyers Credit, L/C commission should be recovered at
booking rate for which liability voucher is to be passed. This is due to the fact that
exchange fee is being recovered in advance.

iii. If bills are to be drawn at a Usance under the above Letter of Credit other than
PAYEES And Suppliers/Buyers Credit and deferred payment Letters of Credit on
yearly basis.
1. Rs.500/- per bill (Flat) to be charged at the time of retirement of bills.

2. Extra Commission @ 0.10% per month is to be recovered/charged for the Usance

Import Bill for any period beyond validity of Letter of Credit.

Amendments.

Rs.750/- per transaction (Flat) or commission under item (I.-a) or (ii-a) Pg-1, if
amendment involves increase in amount or extension period of shipment.

iv. Issuance of Standby Letters of Credit (i.e.) beneficiaries in foreign countries)

directly or through correspondent bank/bank’s foreign branches/offices.

0.40% per quarter or part thereof Minimum Rs.1, 000/- plus

Correspondent bank charges if any.

Swift/Telex US$ 20/- per telex /swift message

Postage US$ 10/- per postage

Amendments.

US$ 20/- per transaction (Flat) or if amendment involves (increase in amount or

extension in period) comm.. As above

V. a. For providing certified photocopies/ transfer of Category Pass Book. Rs.1, 000/-
(Flat)

b. Processing charges for new Import Registration. Rs.1, 500/- (Flat)

c. Renewal of Category Pass Book Rs.1, 000/- (Flat)

vi. Mark-up in case of Import Bill under Import Letter of Credit.

a. 45 Paisas per Rs.1,000/- (or as per Sanction Advice) on daily products from the date
of reimbursement till the date of retirement.

b. Bank’s commission on bills under Import Letter of Credit.

In addition to mark-up as per VI (a) Bank’s commission is to be charged as under:-

1. If retired within 10 days

From the date of lodgment. No commission

2. If retired during 15 days 20 Paisas per Rs.100/-

subsequent to the period on purchase price.

At item (1) above.

3. If retired during next 15 25 Paisas per Rs.100/- days after the period on purchase
price mentioned (1) & (2) above.

4. If retired during next 35 Paisas per Rs.100/- 190 days after the period on purchase
price mentioned at (1) (2) and

NOTE.

1. The Branches in their notice to Importers will indicate the sale price (Marked-up)
by

adding Rs.11.50 for each Rs.100/- or part thereof and will recover mark-up from the
date of reimbursement to the date of retirement of the bill by the client by applying the
Slab of rates as per clause (VI) above.

2. Benefit of cash margin recovered at the time of opening of L/C will be given to the

customers at the time of retirement of documents.

3. No mark-up will be charged from the date of reimbursement till the date of
lodgment of documents received under Import L/Cs where the amount as per
reimbursement arrangement is made to the negotiating bank only on receipt of the
documents.

4. In case of FIM the following mark-up will apply:-

i. Mark-up 43.836 Paisas per Rs.1,

000/-on daily product (or as per
Sanction Advice) against Regular
Credit Line under approved
arrangement.

ii. In case of Forced Creation

of FIM penal charges to be recovered
 not exceeding Paisas 50 per Rs.1, 000/-
on daily product basis.

iii. In case FIM is created and Bank

arranges Clearance of consignment
under Sight L/C, 50 Paisas per Rs.1,
000/- on daily products shall be
charged from the date of creation
ofFIM plus 1% handling
charges/commission.

5. In case Forced FIM is created due to non-payment on maturity against

DA/Suppliers Credit L/C. Commission @ 0.35% is to be charged (once only) in
addition to mark-up @ Paisas 50 per Rs.1,000/- from the date of maturity till the date
of payment.

6. Bank reserves the right to change the mark-up rate on case to case basis.

vii. Import Bills returned unpaid. Handling charges US$ 50/- (Flat) from Forwarding
Bank plus Courier charges if any.

Viii.

a. Collection Rs.750/- (Flat) per collection provided no charges are realized from the
correspondent.

b. Consignments. 0.20% (Flat) handling charges at the time of registration of contract/

purchase order/ Performa invoice Minimum Rs.500/-

c. Import against advance payment to suppliers. Rs.750/- (Flat) plus usual remittance
charges.

ix. Service charges against Import transactions i.e. Import Bills/PAD/Collection. @

Paisas 10 per Rs.100/- or Re.1/- per mille. Minimum Rs.500/-

x. Reimbursement charges (payable to reimbursing Banks.) At actual. Charges for

borrowing customers as per arrangement.

5.1.2. EXPORTS

i. Processing Charges for Export Registration. Rs.200/- (Flat)

ii. Letter of Credit.

a. Advising. Rs.350/- (Flat)

b. Amendment Advising. Rs.250/- (Flat)

c. Negotiation of Bills against Letters of Credit issued under Barter/Remittance From

SBP. 0.25% Minimum Rs.200/-

d. Confirmation. 0.25% per quarter Minimum Rs.250/-

e. Transfer of Export L/Cs. Rs.350/- (Flat)

f. Reimbursement payment to other local bank from Non-Resident Rupee Account.

Rs.350/- (Flat)

iii. If the documents are sent to other banks for negotiation under restricted Letter of
Credit. Rs.350/-(Flat)

iv. Collection.

a. Clean Cheques/Drafts/FTCs. Rs.100/- per Collection (Flat)

b. Documentary (on which bank do not earn any exchange difference). Rs.200/- per
Collection (Flat) v. a. Duty draw back claims. 0.25% of the amount of claim
Minimum Rs.250/- per claim.

b. Handling of export documents against which advance payment is received. Rs.200/-

(Flat) plus postal charges.

vi. Collection FEBCs, DBCs, FCBCs, Special USSDBs and coupon.

Note.

No Charges on E-Form Endorsement & issuance of advance payment slip. 0.20%

Minimum Rs.200/- Max. Rs.500/-

vii. Service Charges against export documents sent on collection basis where payment
cover is already received to our Foreign Currency Account. @ Paisas 10% or Re.1/-
per mille.

5.1.3. REMITTANCES.
(i) OUTWARD

a. Foreign Traveller Cheques. 1% of the amount of Traveller Cheques sold Min.

Rs.200/-

b. i. Remittance abroad through Foreign Currency Account. Commission @ US$ 1.00

per US$ 1,000/- or part thereof Min. US$ 5.00 Maximum US$ 25.00 plus telex
charges Rs.250/- per telex in case of telegraphic transfer.

ii. Remittance against surrender of F.C Notes or cash deposited in F.C Account within
10 days from the date of such deposits.

Note:- Service Charges @ 1.0% to be recovered from the customers in case cash
deposited in FC Account is encashed /converted into Pak Rupees within 10 days from
the date of such deposit . In addition to mentioned under b (i ) above service charges
@ 1.0% to be recovered in case the remittance amount exceeds US$ 5,000/- or its
equivalent in other foreign currencies.

iii. Collection for Foreign Currency Accounts

c. Remittance abroad other than through Foreign Currency.

US$ 5.00 for collection up to US$ 1,000/-

US$ 15.00 for collection above US$ 1,000/-

a. Students (for education purposes). Rs.50/- plus telex charges Rs.200/- per telex if

Telex required or usual postal charges as prescribed.

b. Other than students.

Rs.50/- per US$ 1,000/- Min. Rs.200/- and Max. Rs.500/- plus telex charges Rs.300/-
per telex for telegraphic transfer or usual postal charges as prescribed.

d. Service Charges against issuance of Foreign Mail Transfers (FMTs) Foreign

Demand Drafts (FDDs) Foreign Telegraphic Transfer (FTT) & Travellers Cheques
(TCs) against Pak Rupee. @ Paisas 10 % or Re.1/- per mille.

e. FDD/FTT/FMT Cancellation Charges for foreign currency account. Rs.200/- per

item plus telex/postage charges

f. Issuance of Duplicate FDD. Rs.300/- plus usual telex/postage charges

C. (ii) I N W A R D

a. Home Remittance No Charges (Zero Tariff)

b. Others. Nil, if proceeds are credited to an account with the drawee bank. In other
case a flat

Charges of Rs.10/-

c. Encashment (Purchase) of Traveler Cheques. Rs.100/-(Flat)

d. Service Charges on payment of Inward Foreign Drafts/Foreign Mail Transfers

where payment is made to beneficiaries after payment cover is received to our Foreign
Currency Account. These charges are to be recovered only when T.T buying rate is
applied. @ Paisas 15 per Rs.100 /-Minimum Rs.200/-

e. Commission/Handling Charges on Deposits of Currency notes for the credit of

Foreign Currency Accounts. Nil, if no remittance affected within 10 days of the date
of deposit, otherwise remittance charges % service charges as per schedule C b (ii)

5.1.4. MISCELLANEOUS.

i. Postage/Cable/Fax/Courier

At actual subject to Minimum, as under:-

a. Postage (Ordinary) Local Rs.25/- Inland Rs.40/

b. Postage (Registered) Local Rs.30/- Inland Rs.50/- Foreign Postage at actual Min.
Rs.100/-

c. Telegram • Local/Inland Rs.50/-

d. Telex /Fax/Telephone/Swift Local Rs.20/- Inland Rs.25/- per minute Min. Rs.50/-
Foreign: - . Full Telex L/C/Guarantee and long Message Rs.1, 200/- for full message
for

Short message Rs.400/- . L/C/Guarantee amendment, Telegraphic Transfer and

Miscellaneous messages Rs.1, 200/- for full message. Rs.400/- for short message

e. Courier Local Rs.50/- Inland Rs.70/- Foreign Rs.1, 100/-

ii. Foreign Bills sent for collections returned unpaid Rs.350/- (Flat) plus telegram
charges if any.

iii. Inward Collection received (relating to F.C Account) from abroad or local
banks/branches and where the payment is demanded in Foreign Currency. US$ 3.00
per US$ 1,000/- or part thereof Minimum US$ 3.00 Maximum US$ 6.00

iv. Inward cheques expressed in foreign currency drawn on foreign currency A/cs
received from local/upcountry bank’s branches for payment in Pak Rupees after
conversion at authorized dealers buying T.T clean rates. Commission @ Paisas 15 per
Rs, 100/- Minimum Rs.200/-

v. Issuance of proceeds certificate beyond one year. Rs.500/- (Flat) per certificate.

vi. Issuance of Business Performance certificate at customer’s request. Rs.500/- (Flat)

per certificate.

vii. Standing Instruction Charges in Foreign Currency Accounts. US$ 5.00 per
instruction

5.2. DOMESTIC BANKING

5.2.1. REMITTANCES.

Issuance of Drafts, MTs, & TTs:

a. Up to Rs.100,000/- 0.10% Minimum Rs.50/-

b. Up to Rs.1, 000,000/- 0.05% Minimum Rs.100/-

c. Over Rs.1, 000,000/- 0.04% Minimum Rs.400/-

d. Issuance of Duplicate Draft.

1. For account holders Rs.200/-

2. For non account holders Rs.250/-

a. Telegram Charges on TTs. (whether through Telex/Fax) Actual, Minimum Rs.75/-

b. Trunk Call charges on issuance of T.Ts Rs.100/- (Flat)

c. Postage on MTs.
d. Courier Charges. Actual Minimum Rs.30/- if sent by Registered post locally,
Rs.50/- if sent by Registered post Inland on party’s request. Local Rs.50/- Inland
Rs.75/-

5.2.2. PAY ORDER.

a. Issuance of pay order:-

1. For account holder Rs.50/- (Flat)

2. For non-account holder Rs.100/-(Flat) Rs.25/- (Flat) from student for payment of
fee favoring educational institution

b. Issuance of duplicate Pay order

1. For account holder Rs.100/- (Flat)

2. For non-account holder. Rs.150/-(Flat)

5.2.3. Issuance Of Call Deposit Receipt

1. For account holder Rs.50/-

2. For non-account holder Rs.100/-

b. Cancellation/Issuance of Duplicate Call Deposit Receipt.

1. For account holder Rs.100/-

2. For non-account holder Rs.150/-

Iv. Inland Travellers Cheque. (Other than NBP if any) 0.25% Minimum Rs.25/-

iv. Inland Letters of Credit. (Opening

commission)

Annual Business

Up to Rs.50 (M) 0.40% per quarter or Up to Rs.75(M) 0.35% part thereof Up to

Rs.100(M) 0.25% Above 100(M) Negotiable Minimum Rs.1,000/=

a. Amendment Charges.
A) Without increase in amount or extension in period of shipment Rs.500/- (Flat)

B) Involving increase in amount and/or extension in period of shipment Rs.500/- per

transaction/commission as per item (iv) above

b. Advising/Amendment/Confirmation Charges of (Inward) Inland L/Cs. above

Rs.500 (M)

Note: Charges negotiable on case to case basis under approval of Business Group

Head. Same as applicable in case of Export L/Cs Rs.500/- (Flat)

vi. Authorities to encash cheques. No commission by issuing branch but charges on

purchase of cheques will be recovered commission @ 0.80% Minimum Rs.25/- plus
Courier Charges Rs.30/-

vii. PO/DD/TT Cancellation

1. For Account holder Rs.50/-

2. For non-Account holder Rs.100/-

DD Issuance Charges Rs.200/-(Flat)

5.2.4. BILLS.

i. Collection:-

a. Documentary Bills. 0.40% Minimum Rs.50/- plus postage/courier charges.

b.i. Clean (including cheques/dividend warrants/bank drafts etc)

ii. For NBP own cheques/DD/PO 0.20% Minimum Rs.50/- plus postage/courier
charges as mentioned above.

NOTE:

No commission should be charged on out station cheques, drawn on places where

there is an office of the bank, which are received from Government Departments for
credit to Government Account. This waiver does not applied to outstation cheques
tendered by the PUBLIC in payment of Government dues upon which the Bank’s
usual charges should be levied. As per Zakat & Ushr Ordinance 1980, (Amended in
1997) banking services and services connected with the assessment collection or
disbursement of Zakat & Ushr realizable on compulsory basis under this ordinance are
to be rendered free of charge. Hence no collection charges shall be recovered on
cheques drawn on Central Zakat Fund for crediting to account of their beneficiary.
0.15% Minimum Rs.50/- plus applicable postage/courier.

iii. Purchase of bills, cheques etc.`

a. Documentary Bills other than those drawn against Letters of Credit

b. Clean Bills (trade cheques, bank draft etc.) a. 0.25% Minimum Rs.50/- plus
applicable

postage/courier charges. b. 0.40% Minimum Rs.25/- plus applicable postage/courier

charges.

NOTE:

i. Postage/Courier Charges are to be recovered on collection/realization of each

instrument(whether clean or documentary). However, in case where party has
deposited more than one cheque/instrument on a particular date to be collected/drawn
on the same branch of the bank, postage/courier charges are to be recovered (once
only.)

ii. Collection of cheque of small amount may be effected through normal dak (other
than

Courier) if specially requested by the party in writing for which he will be responsible
for the delay.

b. Other cheques/demand instruments (Like dividend warrants). 0.60% Minimum

Rs.20/-

NOTE:

i. Collecting agent’s charges if the Collecting bank’s is other than the Bank will be
extra.

ii. Telegram/Trunk Call Charges will be Extra, if fate of the instruments is asked for
by telegram.
c. Returning Charges for Documentary & Clean Collections, in case the instruments
are returned unpaid. Rs.100/- + Courier Charges as above (Documentary) Rs.100/- +
Courier Charges as above (Clean).

d. Mark-up shall be applied as under on bills purchased/negotiated. If retired up to

21st days from the date of Purchase but during next 210 days (cushion period) 40
Paisas per Rs.1, 000/- per day

e. Storage Charges. i. No Charges, if cleared within 3 days of its receipt by the branch.

ii. Re.1/-per packet per day Min. Rs.50/-

iii. Documentary bills drawn against Inland

5.2.5. Letters of Credit.

Charges for borrowing customers as per arrangements.

1. SIGHT BILLS.

a. Negotiating end Negotiating Commission @ 0.50% Minimum Rs.500/-

b. Collection Charges (Inland L/Cs) Rs.500/- (Flat)

c. Collection Charges for restricted L/C (where Negotiation is restricted to some other
Banks and presented to us for forwarding). Rs.500/- (Flat)

d. At opening end (at the time of retirement) rate of Mark-up.

i. If retired within 3 days from the date of lodgment Mark-up @ 45 Paisas per Rs.1,
000/- on daily product from the date of negotiation.

ii. If retired after 3 days of lodgment Mark-up @ 45 Paisas per Rs.1, 000/- on daily
product plus Banks Commission @ 0.25%

NOTE.

No mark-up will be charged from the date of negotiation till the date of lodgment of
documents received under Inland L/Cs where the payment as per reimbursement
arrangement is made to the negotiating bank only on receipt of documents.

iii. If negotiation is restricted to some other bank.

Inland L/C cancellation charges Rs.500/- (Flat)

Forwarding Bank/Branch would charge handling charges of Rs.200/- (Flat) per bill
(commission will not be applicable).

2 USANCE BILLS

At opening end.

a. Handling Charges. Rs.0.40% per bill Minimum Rs.500/- at the time of retirement of
bill.

b. If bills matures after expiry of L/C. Usual Charges as in (a) above plus delivery of
documents against acceptance commission @ 0.10% per month on bill amount on
realization from the date of expiry of L/C but Minimum Rs.500/-

c. Discounting of Inland Usance Bills. Markup @ 25 paisa per Rs.1000/- on daily

product (or as per Sanction Advice) plus flat Commission @ 0.1%.

3. At collecting end.

a. Collection Charges Commission @ 0.30% Minimum Rs.200/-

b. In case of purchase. Usual Commission as in (a) above and keep mark down @
0.75% for every 15 days from the date of purchase till the date of maturity.

NOTE

All other charges as per quote (i) & (ii) and (c) above wherever applicable will be
extra.

5.2.6. PROJECT FINANCES/ADVANCES

Following Charges may be recovered in-addition to interest/mark-up return on

investment.

1. Project Application Fee

(Non-refundable)

Following charges will be recovered in addition to mark-up/Return on Investment.

Miscellaneous (i.e. is charges for documentation, evaluation of security and
maintenance thereof etc.)

At actual, in addition:

1. Project examination fee @ 0.50% (flat) after acceptance of sanctioned by the

company but before disbursement of the total amount of sanctioned (Funded and Non
Funded Both) Minimum Rs.15, 000/-

2. Legal documentation fee. @ 0.25% Flat after acceptance of sanctioned by the

Company but before disbursement of the total amount of sanctioned (Funded and Non

Funded Both)

3. Project monitoring fee @ 0.25% p.a. payable quarterly on outstanding amount

(Funded and Non Funded Both)

4. Commitment fee @ 1.50% p.a. payable quarterly on the un-disbursement amount

of sanction (Funded only)

5. Front End/Arrangement Fee. @ 1.50% (Flat) wherever applicable as per Bank’s

discretion. Concessional rates are admissible on case to case basis with the approval
of Head Office

Miscellaneous Charges for issuance of NOC.

For issuance of NOC at the request of customers/clients for creating additional/pari-

passu charges/second charges on their fixed assets for acquiring further project
finance from other Bank’s/Financial Institutions. Rs.10, 000/- (Flat)

NOTE:

Recovery of these charges waived from:

a. Clients having total facilities exceeding Rs.100 (M)

b. Clients allowed facilities under consortium financing.

4-a. Redemption of charge fee to be recovered from party when bank officers are
called

before registrar for redemption of the mortgage. Rs.2, 500/-

b. Vacation of charge with SECP. Rs.1, 000/-

c. Registration of charge at Registrar Office with SECP. Actual + Rs.2, 000/- per case.

d. To arrange lien on securities issued by other Institutions. Rs.250/- per trip.

5.2.7. GODOWN CHARGES

a. Godown Rent. Actual

b. Salaries of Godown Keepers/Chowkidars Actual

c. Godown Inspection Charges.

i. Without any municipal limit. Actual Treatment

Debit to party account if Godown inspection charges are up to Rs.500/- for payment
to staff.

Debit to party and credit to bank income account if inspection charges are more than
Rs.500/- and reimbursement of TA/DA charges through debit to “Expenditure
Account” with the approval of competent authority.

NOTE.

Inspection of Godown by Regional/ Head Office Auditors/External Auditors and

occasional surprise checking by Regional Headquarters etc. No such charges will be
recovered from the parties as it is a part of normal bank duty.

d. Delivery Charges: - If a godown keeper is not posted conveyance Charges will be

recovered. At actual

e. Other incidental expenses. Insurance premium. Legal Charges.

At actual

f. Handling charges on marking of lien on Govt. Securities Rs.500/- (Flat) per

customer

g. Marking of lien on Securities issued by NBP for other banks Rs.500/- (Flat) per
customer

NOTE:
While recovering the miscellaneous Charges like godown rent, godown staff salary,
and inspection charges the amount recovered from the borrowers shall not exceed the
total rent of godown, salary of the godown staff etc. In other word miscellaneous
charges should be levied as per actual and not become a source of profit to the bank.
However, reimbursement of actual conveyance charges to be made to concerned staff
to the debit of Expenses Account after proper approval of the competent authority.

5.2.8. STANDING INSTRUCTIONS FEE.

Standing Instructions fee will be recovered in addition to the usual charges on

remittances, if any. Rs.100/- per transaction.

SALE AND PURCHASE OF SECURITIES SAFE CUSTODY ARTICLES IN

SAFE

DEPOSITS & SAFE DEPOSIT LOCKERS.

A. I. Sale and purchase of shares and Securities

a. Rs.0.50% up to Rs.10, 000/- of purchase price or cost thereof Minimum Rs.50/-

b. Rs.0.10% on amount exceeding Rs.10, 000/- Minimum Rs.75/-

ii. Shares & Securities held in safe custody as a result of order of purchase executed
through the bank (to be recovered up front) Rs.0.50% (Flat) per annum or part thereof
of the face value with the minimum of Rs.300/-

NOTE

a. The above charges is in addition to brokerage.

b. Commission is not to be recovered on purchase of newly floated securities, where it

is payable by the Govt. / Govt. Agencies and from the subscribers to new Shares
floatation. A rebate of 50% in Safe Custody Charges will be applicable to all clients
maintaining Minimum balance of Rs.1 billion or above throughout the year in NIDA
Account.

c. When orders for purchase or sale of shares/ securities are executed through the
banks, other offices, all incidental expenses such as postage, insurance charges etc.,
incurred will be recovered in addition to the commission / brokerage charges.
iii. Withdrawal fee on shares and securities held in safe custody (to be recovered at the
time of withdrawal.)

a. 0.25% up to Rs.10, 000/- of the paid up or face value Minimum Rs.50/-

b. 0.125% on amount exceeding Rs.10, 000/-

iv. Withdrawal fee on Government Securities. Rs.10/- per scrip. Where share and/or
securities sold are from those held in safe custody, either commission on sale of
shares and securities as shown against item (I) or withdrawal fees as shown against
item (iii) whichever is higher, will be charged but not both.

v. Charges for collection of interest/ return / dividend. 0.30% on the amount of

interest/return/ dividend collected/ Paid Minimum Rs.20/-

vi. Handling Charges for conversion, renewal, consolidation or Sub –division of

Government Securities. Rs.10/- per Scrip.

vii. Public Flotation of Shares/Modaraba Certificates/ Offer for Sale of Shares/Dis

investment/Term Finance Certificates. Commission @ 0.50% plus Out of Pocket
Expenses - actual

NOTE: Commission negotiable on case to case bases.

viii. Payment of Dividend Warrants through designated branches. Commission @

0.50% plus Out of Pocket Expenses – actual

NOTE: Commission negotiable on case to case basis

Safe custody Articles in Safe-Deposit lockers.

Safe Deposit fee (to be recovered in advance at the time of deposit or at the
commencement of each Quarter)

A. For Boxes and Packages. Rs.4/- per 100 cubic inches or any part thereof with a
minimum of Rs.300/- per quarter.

B. For Envelopes. (Contents unknown) Rs.2/- per 25 square inches or any part thereof
with a minimum of Rs.300/-

ix. Safe Deposit Lockers Fee for Safe Deposit lockers (to be recovered in advance or
at the commencement of the period yearly, half yearly, quarterly as the case may be.)
a. Up to 0.40 cft Small Rs.1, 000/- per annum

From 0.41 to 0.80 cft

From 0.81 to 1.35 cft Medium Rs.1, 500/- per annum

From 1.36 to 1.75 cft

From 1.76 to 2.00 cft Large Rs.2, 500/- per annum

From 2.01 to 2.50 cft

From 2.51 to 3.00 cft Extra- Large Rs.4, 000/- per annum

Key Deposit.

Deposit will apply at the Small Rs.3, 000/-

‘Time of issuance of new

‘Lockers. Medium Rs.4, 000/-

Large/Ex-Large Rs.4, 000/-

Breaking Charges.

Rs.2, 000/- per locker/Actual (whichever is higher)

x. SERVICE CHARGES FOR INVESTMENT IN PAKISTAN INVESTMENT

BONDS (PIB)

Maximum Custodial charges. Rs.100, 000/- per annum per PIB issue or Rs.8, 333/-
per month.

Face Value Balance of up to PKR 1 Million No Charges.

Face value Balance of PKR 1 Million to PKR 200 Million Maximum 0.05% p.a. with
a Minimum Charge of PKR 1,000/- per month

Face Value Balance in excess of PKR 200 Million PKR 8,333/- per month

Note:
Custodial Service Charges are to be calculated on month-end balances & charged to
customers monthly, with no charge on initial sale/origination of transaction.
Subsequent sale/transfer to an IPS account of another PD is subject to a charge of
Rs.1, 000/- per transfer/transaction. The aforesaid charges are linked to each
individual issue and should not be levied on aggregate basis.

5.2.9. GUARANTEES.

i. Charges for borrowing customers. As per arrangement.

ii. Guarantees issued to shipping companies in lieu of Bill of Lading or endorsement

of copy of Airways Bills in absence of original Airways Bill. Rs.1, 000/- (Flat)

iii. Guarantees issued to Collector of Custom in lieu of payment of Export Duty which
are valid up to 6 months. 0.50% per quarter or part thereof Minimum Rs.1, 000/-
(2.00% per annum).

iv. Issuance of foreign guarantees (i.e. beneficiaries in foreign countries) directly or

through correspondent bank/bank’s foreign branch/offices 0.40% per quarter or part
thereof Minimum Rs.1, 000/- plus correspondent bank charges if any. Swift/Telex
US$ 20/-per Tlx/Swift message Postage US$ 10/- per postage Amendments in (iv)
above. US$ 20/- per transaction (flat) if amendment Involves (increase in amount
extension in period) commission as above.

v. L/G under Suppliers/Buyers Credit “Pay as you Earn Scheme”

Commission @ 0.40% per quarter or part thereof (at the time of issuance of L/G it is
to

be charged on full amount of L/G liability plus interest payable thereon for the period
from the date of issuance of LG/ till the expiry of L/G thereafter commission is to be
recovered on six monthly basis on outstanding/reducing liability as per revised
Schedule of charges applicable on that date.) In case forward cover is provided against
L/G under Suppliers/Buyers Credit, L/G commission should be recovered at booking
rate for which liability voucher is to be passed. This is due to the fact that exchange
fee is being recovered in advance.

vi. In case of L/G under taking to be issued favoring any bank for providing forward
cover exchange risk under Suppliers/Buyers Credit on behalf of applicant.

vii. Other Guarantees

viii. Guarantees issued against collateralization of foreign currency deposit. L/G
commission to be charged @ 1.6% per annum to reducing liability on booked rate
Minimum Rs.1,000/- 0.40% per quarter or part thereof Minimum Rs.1,000/- (1.6%
per annum) up to one year)

a. Deposit More than US$ 500,000/- 0.25% per quarter or part thereof Minimum Rs.1,
500/- (1% per annum)

b. Deposit more than US$ 500,000/- up to 5,000,000/- 0.125% per quarter or part
thereof Minimum Rs.1500/- (0.5% per annum).

c. Deposit more than US$ 5,000,000/- Nil

d. Amendments Rs.300/- per amendment (Flat) or 0.40% per quarter or part thereof if
amendment involves increase in amount of extension in validity Minimum Rs.500/-

NOTE.

1. All Guarantees issued by bank must contain specific amount and expiry date and
commission to be charged from the date of issue till expiry of the L/G up front.

2. If period of Bank Guarantee exceeds one year than commission be recovered on

year to year basis.

3. For calculation purpose a quarter would consist of 3 months starting from the date
of issue of Guarantee (Three calendar months will make one quarter.)

5.2.10. MISCELLANEOUS CHARGES

1. Service Charges on PLS Saving Accounts including dormant, inoperative and

unclaimed with monthly average balance below Rs.5,000/-.

Exemptions:-

The following categories of account holders are exempted from levy of the Service
Charges:

i) Students

ii) Mushtahiqueen of Zakat

iii) Employees of Government/ Semi- Government institutions drawing salary /

pension.
iv) Person availing any consumer product related finance facility from the bank would
also be exempt from levy of service charges.

v) Ex-NBP employees or their spouses drawing pension/medical from the bank.

Rs.50/- per month w.e.f. 01-02-2004

2. Service Charges on Current Accounts including dormant, inoperative and

unclaimed with monthly average balance below Rs.5, 000/-. Rs.50/- per month
w.e.f.01-01-2004

3. Duplicate statements of account older than one year Rs.50/- per statement of
account

4. Issuance of SBP/NBP Cheques. Rs.300/- per cheque

5. Handling charges for issuance of students exchange remittance permit and

maintenance of record for subsequent remittance. Rs.200/- per annum

6. Stop payment of cheque. Rupee A/c Rs.150/- per instruction. F.C A/c US$ 5/- per
Instruction

5.2.11. EXTRA.

Stop payment charges are to be levied one time for stop payment instructions whether
it is for one or more cheques.

7. Clearance of Cheques where Clearing House Facility not established. No Charges.

8. Collection/encashment of profit coupons on Govt/Saving Centers under lien to us.

Rs.200/- per trip.

9. Verification of test for other banks/parties Rs.250/- (Flat)

10. Credit information report including credit report on foreign suppliers/buyers.

Foreign correspondent/reporting agencies charges at actual + Tlx. Charges.

11. Registration of contract with SBP in respect of private foreign currency loan
obtained by borrowers in Pakistan from foreign lenders. Handling charges Rs.5, 000/-
(Flat.)

12. Confirmation of balances to auditors. Rs.400/-

13. Balance Confirmation Certificate (required by customers other than auditors).
Rs.100/- per certificate.

14. Charges for Cheques returned unpaid (when fault lies with the customer) to be
recovered from the client on whose behalf the instrument is being collected and
collecting bank will apply these charges. In case bearer cheque returned on the
counter no such charges will be applicable. Rupee Account 200/- per cheque. F.C
Account US$ 5/- per cheque.

15. Issuance of new cheque book in lieu of lost cheque book (Rupee A/c only). These
Charges are in addition to stop payment charges as prescribed in (4) above. Rs.75/-
per cheque book in rupee Account. US$ 2/- in F.C Account.

16. Issuance of loose cheque. Rs.50/- per cheque Rupee A/c US$ 1/- F.C A/c

17. Account closing charges. Rs.250/- for Local Currency or entire amount if balance
in the account is below Rs.250/- . US$ 5/- for Foreign Currency or entire amount is
below US$ 5/-

No charges on closing of old frozen FC A/cs

18. Issuance of Cheque Book Rs.2.50/- per leaf Mailing Charges for Cheque Book.
Actual.

NOTE.

No Charges will be recovered from customers maintaining deposit balances of US$

25,000/- and Above or equivalent of Rs.1/- (M) and Bank Staff are also exempt from
levy of this charge.

19. Charges from employer on Salary Disbursement Services. Rs.25/- per salary
account per month.

NOTE:

A number of Commercial Organizations (other than Govt.and Semi-Govt. and

Autonomous Bodies)disburse salary to their employees through our branches. Where
such organizations do not maintain sufficient funds or route sufficient business
through our bank to justify workload of salary disbursement, bank is justified to claim
charges from them for the additional workload.
We can not charge individual accounts under Prudential Regulations. We can
however, charge the employers where they do not maintain sufficient funds or route
ancillary business through our bank. We must charge them for disbursement of salary
to their employees. ATM Facility. ATM card will be issued free of cost. However,
annual renewal fee of Rs.300/- will be charged. Transaction cost for NBP customer
using another bank ATM under 1-LINK ATM SWITCH Service. Rs.15/- per
transaction Tariff for Corporate Customers & MNCs With aggregate exposure of
over Rs.500/- Million (Both refunded and non funded) and in case of all MNCs L/C
Opening guarantee issuance and remittance (Funds transfer) charges. As per
negotiation with the customer.

5.2.12. WAIVER OF CHARGES FOR CUSTOMERS MAINTAINING

MONTHLY AVERAGE BALANCE OF RS.2.000 (M) AND ABOVE IN
CURRENT ACCOUNT OR RS.5.000 (M) AND ABOVE IN PLS SAVINGS
ACCOUNT/NIDA ACCOUNT

a. Commission on DD/TT/MT & pay orders.

b. Cancellation/Issuance/Duplicate Pay orders.

c. Cheques returned unpaid.

d. Stop payment of cheques.

e. Issuance of new cheque book in lieu of lost cheque book.

f. Issuance of Duplicate statement of account older than one year.

g. Issuance of loose cheques.

h. Commission on Overseas Bills/Inland Bills for collection business. (Subject to

recovery of postage, courier, fax, telex, trunk call charges wherever applicable).

5.2.13. BANK CHARGES FOR GOVERNMENT BUSINESS.

A. IMPORT:
a. Cash Letters of Credit Less than Rs.250, 000/- 1/8% (0.125%) of the value of the
letter of

Credit. Rs.250, 000/- and above. 1/16% (0.0625%) of the value of the letter of credit.

b. Non-reimbursable letter of credit under Barter /Aid Loans/Authorization to pay.

3/8% (0.375%) irrespective of the value of the letter of credit.

NOTE

In addition to above, branches will recover the actual cable/telex/swift charges where
LCs are desired to be established through cable/telex/swift and confirmation charges
of foreign bank’s if foreign bank’s confirmation is also to be added on opener’s
request. The above concessionary rates/charges will apply only to those Letters of
Credit which cover imports by the Government routed through State Bank of
Pakistan. In case LC is received directly from the importing agency, normal charges
are to be recovered.

　
　
　
　
　
　
　
　
　
　
　
 6.Tech Society Branch Lahore
6.1. INTRODUCTION:

It is an old branch of national bank of Pakistan. It is followed the instructions and

under control in regional head quarter (east region). It is called as a big branch which
has required 10 million rupees daily in terms of reserves to meet daily requirement of
transactions. It has following accounts with regional office,

1. general account

2. Suspense Account

3. Commission Account

In public they deal in two accounts i-e.

1. Current Account

2. PLS Account

They provide lot of services like.

1. Deposits

2. Advances

3. Pension

4. Foreign Exchange

5. Compliances

6. Bills

7. ATM

8. Utility, bill, traffic challan, admission of AIOU.

9. Locker’s Services

10. Western Union (By name only)

In this branch at time 20 executives are providing service. 2 assistant voce presidents
are serving at this branch. M. Zulfiqar (manager) and Ifzad Butt (Advances officer). In
this year two performance awards get by the branch.

6.2. LEARNING AS A STUDENT INTERN:

There are following learning points for me in the bank.

6.2.1. Duties

In my first week in NBP, they assign me worked in pension department. Pension

manager Mr. Muhammad Iqbal trained me very nicely and I learned lot of things in
this department. They give the pension to retired Govt. employees. There are three
type of pensions given,

1= Provincial

2= Central

3= Defence

These are different according to their PPO numbers

For example:

Provincial PPO 123456

Central PPO 12345/pak

Defence PPO da/dg1/gh/4 etc.

I am full trained now in this particular job and I serve 1000 people in this week. How
to fill farm? How to enter in ledgers and balance account and what is file and book
and all other things relating to pension department.

In second week I perform following tasks relating to the banking system.

In second week I worked on opening of account. In this week I repeatedly performed

this activity.
In third week they assign me with operation manager Mr. Numan sagheer He handled
the activities relating to the branch; check all the work in the branch. He gave me
official computer. In this week I type and print so many letters for example;

• Statement of account

• Letter of tax verification

• Letter of issuance of clearing certificate

• 4 letters for cheques clearing

• Letters of relieved of transfer employees from this branch to another

branch

• Joining letters of new employee come from other branch through

transfer

• Exceptions reports of Mr. Saeed and so many other things.

I also print and type the data of advances department and foreign exchange
departments. Cheques clearing daily sheet is also made by me in this week and I am
assisted by the other officers. I also learn about the reserve of the branch and daily
finances need by the bank and also get some raw information about the opening new
accounts.

In fourth week I assign the same task and learn some more complex and major
operation of Sir Numan Sagheer I learn about accounts in which the branch deal with
the main and other branches, these are as follows;

1. General Account

2. Suspense Account

3. Commission Account

4. Exchange Account

In general account the branch debt or credit the other branches of the NBP. Usually
they debit or credit the main branch which transfers the cheques on this. In suspense
account branch expenses are made and at the end of six months period inform and
show the balance to main branch. In commission account bank charges commission
against its services. In exchange account they also earn, so from last two accounts
branch receives earnings from main branch against its services.

Secondly in this week I also learn hoe to open an account in the branch, it is a
procedure and after it bank open an account.

On computer I type and print so many letters like,

Reconciliation letter

Relieved letter

Joining letter

Medial recovery letter

And at the end I also scroll the challan of Government and pass vouchers.

In first three days of fifth week there are busiest days of pension department so I help
the again pension manager. So first three days serve in this particular task.

In this week I do same job again and print letters, reports, statements and daily
clearing statement of cheques. Also work with Mr. Shafique and from him I learn
about opening an account, payment order and demand draft. Payment order is made to
send payment with in city and draft is made for payment outside the city but inside the
country.

S C is that when cheques are coming from outside city for cash and
those cheques which come from branches inside city are sent to clearing house, so I
made the statement to clearing house for clearing cheques.

In fifth week I performed following activities:

Monday

On this day I perform the duty on the seat of bills where following work is being
done,

Opening an account

Issue new cheques books

 Make a payment order

Making the draft

Cheques send for clearing

Along with this task I also enter the daily post letters in the letter register. This is very
busy task is bank. I help the officer in this seat.

Tuesday

On this day I join the duty with passing cheques of PLS A/C. There are fifty three
books of signatures cards of A/C holders. So I find the A/C in these books and then
gave to the executive officer to verify. In this whole day I perform this particular task.

Wednesday

The day is also as above routine to sit in front of computer, scroll following files,

Income tax

Sales tax

Withholding tax

Provincial

Central

Property traffic

So I also make up these files separately, scroll them sequence and filed these files.
Along with this task type and print the letters, reports and work sheets.

Thursday

Mr. Iqbal assigns me the task to rearrange lockers list and set them in a sequence and
print them on pages. Particular are these,

Name

Address
Amount of rent

Security

Expiry date

Locker no

Key no

Folio no

All the day is served in doing this particular task.

Friday

On Friday the accounts of holders of expired lockers are checked. Some have balance
in their account but most of them have non in this branch. Rent from those holders
how balances have has been deducted from their accounts through vouchers and to
remaining holders reminding letters have been sent. This is the end of Friday.

　
6.2.2. Problems faced by branch:

During my internship at this particular branch of national bank of Pakistan, there are
following problems I have found which are directly affect on efficiency and
performance of the bank. There problems are also called as an internal problems. So
these are discussing below.

1. Lack of communication among the employees:

During the period of my internship I found this problem as a biggest problem that,
they are not very effective in communication between themselves. They do not share
the experience with each other and do not care the other employee. If one employee
has a problem, then he asked to other, but he does not give clear solution to that
problems. They are shows the facial expressions against each other. Pension manager
and other employees are always tried to gain cash/performance award and use the
references to get it. They are talk against each other in front of me. So finally it is very
needy for a public services organization to keep atmosphere friendly among the
management and employees. National bank of Pakistan (Tech Society Branch) is lack
in communication skills among the employees.

2. Ineffective public dealing:

There is also a big issue that they think its government’s bank so it does not care
customers. It is a wrong perception. There must be a good public dealing in public
service organization. If one customer asked a question twice. They angry on him and
stop working. I personally experienced in pension department. The manager pension
(Mr. Iqbal) have no respect to the old pensioner and he used wrong wording against
them same is also happened in bills executive in bills (Mr. Shafique) is also angry on
Customers, when they asked question twice, so there should be solve this problem to
create a good environment of the NBP.

3. Lack of commitment:

Lack of commitment is also a bib problem faced by the national bank of Pakistan
(wahdat road branch). Employees are not committed to the work and their duties. This
is very common problem.
For example, Rao Ikhlaq not received the letters from last two months. ATM machine
is under Rao Ikhlaq but it is run by operation manager. Mr. Kamran not attached the
scroll at time. Mr. Qamar Zaman going on leave of 3 days but he does not come back
even after 3 weeks. So internees are performed duties on his seat. So employees are
not very committed to their jobs and duties. Top management is also not very
committed to this branch. They are not provided employee after transfer of the Rao
Ikhlaq. One executive on leave while other transferred. But not a single executive
provide to the branch finally it is conclude that there is a lack of commitment from
employees and top management also from employees and Top management also.

4. Low Efficiency of employees:

Efficiency of employees is also low at this branch. For example Mr. Qamar Zaman
Aulik has 10 years experience at national bank of Pakistan but he is not professional
even at single seat in the bank. Where he assign the result is zero. During my
internship firstly he works in advances. He does not sent returns to head office at last
dates. 95% of returns are not sent to the regional head quarter. So he was not too
much professional. After this he assign in passing the cheques but results are same
(zero). So for this efficiency is very low at this branch.

5. Not very regular and punctual:

Regularity and punctuality shows the character of a big and good executive. But this
problem is also faced by the NBP (Wahdat road) many executive not come at time.

For example Mr. Saeed compliance officer came 10 A.M. While bank is started at
9AM. So some other executives are also not coming at time. So there must be solved
that problem by the Top management.

In regional head quarter Mr. Munawir Shah is HRM assistant manager is also come at
10 Am.

6. lack of computing skills:

Computing skills are also low, some executive are very efficient in computing skills
but some are not totally aware from this system. For example ATM machine at this
branch is only handled to Mr. Imran operation manager. When operation manager is
on leave due to heart patient, ATM machine is off not worked because no body knows
to run this machine. Western Union is not worked effectively. The person who
handled western Union is careless and other employees are not taken interest in tat
field. So there is western Union for just name actually it does not worked.
 7. Misuse of resources:

Resource are very needy, so there must be avoid to misuse the resources but in this
branch it is reverse case, there is very wrong use of the resources, employees does not
take care of resources and not used them in right direction. For example wrong
printing, extra printing, after service time Mr. Hasnain at token used telephone almost
one to two hours to take personally outside the bank. So these are the real problems
which are faced by the bank.

Finally it is suggested that if these problems are solved there are much more chances
for increase the performance of NBP. Particularly this branch.

6.2.3. NEW KNOWLEDGE ACQUIRED

During the internship there is practical knowledge acquired about the banking sector.
What activities are performed by banks and how to deal with public? Also
commitment about work and operations of banks. Financing and credits and other
public services are performed by the banks. What are implementations of banking
rules in banking sector? And much learn about the various executive’s experiences
and their skills. What is role of higher authority (manager) in decision making and
how to solve the problems? How much money or reserves are used to meet the
requirements in the branch. What are the duties of operation manager and how to pay
cheques and all procedure relating to opening account in the banks?

6.2.4. Problem encountered:

During my internship in this bank, the problem which I faced that was proper training.
They do not provide the proper training to the internees. They assign the intern only
few seats in the bank.

7. Bibliography
7.1. www.nbp.com.pk

7.2. Mr. Saeed compliance officer

7.3. Mr. Numan Sagheer operation manager

7.4. Mr. Iqbal pension officer

7.5. Mr. Ifzad butt assistant vice president

7.6. Mr. Shafique bills officer

7.7. Ch. Muhammad Sharif vice president and former manager in this branc