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UNIVERSITY OF SARGODHA
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UNIVERSITY OF SARGODHA
Internship Report
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Internship Report
Internship Letter
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Internship Report
Preface
In order to be able to crumble with the altering environment it is necessary to
have some practical experience. As the students of Commerce we have to pass
through a series of various managerial techniques. During this practical course
we are provided with an opportunity to learn that how the theoretical knowledge
can be implemented in practical grounds. I was selected to do my internship in
NIB Bank of Pakistan Mian Khan Road Branch Sargodha. I worked there for six
weeks & it gave me a greater practical knowledge about the operations of a
bank.
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Internship Report
Dedicated To
Hazrat
Muhammad
(P.B.U.H) and
my beloved parents
and teachers who
inspired us to
higher ideas of life.
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“O mankind if you have a doubt about yhe resurrection (consider)that we created you out of dust, then out of sprem, then out of a beach like cloth, the out of morsel of flesh, partly formed and partly unformed, in order that We may manifest (foster you) that you may reach your age of full strength; and some of you are called to die, and some are sent back to the feeblest old age, so that they know nothing after having known much,”. “Holy Quran”
Internship Report
THE HOLY QURAN SAYS,
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Internship Report
AcknowledgementBy the Grace of Almighty Allah, the most Merciful, the most Beneficial, I'm today
submitting my internship report; I have the pearls of my eyes to admire the
blessings of the compassionate, omnipotent, the Merciful and the beneficent
Allah who is the entire source of knowledge and wisdom.
Due to his bounteous blessings, I become able to contribute this comprehensive
assignment toward the deep ocean of knowledge already exists. Heart is warm
with love and thoughts have turned to the city of knowledge – The Holy Profit
(P.B.U.H) His saying “Learn from to Cradle to Grave” inspired the strong desire in
me to under take this course of valuable studies.
It would obviously be injustice not to mention the name of the people involved to
make this assignment possible and helped their utmost to make me understand
the overall operation of the company as of their best knowledge.
Despite of the most hectic schedule, Madam “javeria Islam” helped me so much
and also branch Manager “Raja Qaiser”. I'm really grateful to ma’am for
clarifying my concepts and making me learn from her experience. Whatever I
learnt from you will definitely help me in my upcoming study and the professional
life ahead. Thank you so much for being so co- operative and so helpful every
time. I hope ma’am I have been up to your expectations.
Date: Sep20, 2010
Supervisor:_______________________
Observer:________________________
Head of Department: _______________
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Internship Report
Executive SummaryNIB Bank Limited provides various financial products and services in Pakistan.
Its Corporate Banking segment engages in underwriting and initial public offer
related activities. The company’s Trading and Sales segment provides fixed
income, equity, foreign exchanges, commodities, credit, funding, securities,
brokerage debt, and prime brokerage services. NIB Bank’s Retail and Consumer
Banking segment offers lending and deposits, banking services, private lending
and deposits, and banking services to retail customers, and small and medium
enterprises. The company's Commercial Banking segment provides finance,
export finance, trade finance, leasing, lending, guarantees etc.
I have done 6 weeks internship starting from 7 th July to 19th August 2010 from NIB Bank branch from Sargodha region.It is the main part of my internship report. It consist on the detail of the work that I have done there as an internee. In NIB Bank I worked in Account opening, Credit, Foreign Trade and Accounts Department. The detail of my work in each department is described in this part with all possible details.
The mostly I worked under the head of Current Account and work for opening of Basic Banking Account .It helped me a lot under stand the criteria for opening of Basic Banking Account. This includes the following points.
The initial minimum deposit to open the account will be Rs. 1,000; however, there
will be no minimum balance charges, if the balance falls below the above
threshold.
If the balance in the account remains ‘Nil' for a continuous six month's period, the
account will be closed. However, exemption to this effect may be solicited from
business head.
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During the course of internship I learned about different functions performed by
Remittances, Advances, Foreign Exchange and Customer Service Office
department and bank as a whole. I also learned bank’s correspondence with their
customers and within branches. I learned about documentation requirements and
record keeping for different activities and processes, especially the
documentation requirement for different kinds of financing facilities.
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Internship Report
1. Industry Introduction………………………………………………..12
2. An Overview of Organization……………………………………...19
2 .1 - History of Organization…………….….……19
2.2 - Nature of Organization…………….………...25
a. Vision Statement………………25
b. Mission Statement…………….25
2.3 - Main Features…………………………...…….28
2.4 – Competitors……………………………..…….55
3. Organizational Structure…………………………………….……..56
3.1 - Hierarchy Chart....................................…...56
3.2 - Number of Employees……………………….57
3.3 - Main Offices…………………….……………..57
3.4 - Introduction of all Departments………...….59
3.5 - Comments on Organizational Structure….69
4. Work done by Internee………………………………………….…..70
5. Financial Analysis of Organization……………………………….73
5.1 - Financial data of last 5 years……………….73
a. Horizontal Analysis
b. Vertical Analysis
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5.2 - Significance of Ratio………………………..78
5.3 - Components of Ratios (formulae used)…79
5.4 - Horizontal Analysis of Ratios
5.5 - Interpretation of Ratios
6. SWOT Analysis……………………………..………………………..91
7. Conclusion……………………………………………………………94
8. Recommendations.………………………………………………….96
9. Limitations…………………………………………………………..100
10. Bibliography`………………………………………………………101
11. Annexes…………………….………………………………………102
12. Glossary…………………………………………………..………..103
1.Industry Introduction:-
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History of Banking:
What is BANK?
It has not so far been decided as to how the word ‘Bank’ originated. Some
authors opine that this word is derived from the words ‘Bancus’ or Banque’ which
mean a bench. Other authorities hold the opinion that the word ‘Bank’ is derived
from the German word ‘Back’, which means ‘joint stock fund’. It is therefore, not
possible to decide as to which of the opinion is correct, for no record is available
to ascertain the validity of any of the opinions
The term bank is being used for a long time yet it has no precise definition. The
basic reason is that the banks perform not just one but many types of functions
originally the banks were supposed to make short term loans to the traders only.
The banks now not only make short term loans to the formers, traders,
industrialist etc. But also invest in a wide variety of long term earning assets.
The commercial banks also undertake and execute trust, deal in stock, shares
and debentures, issue guaranties and indemnities underwrite and sell new
securities, and deal in foreign exchange etc.
Banking industry acts as life-blood of modern trade and commerce acting as a
bridge to provide a major source of financial intermediation.
However some of the definitions of bank from different authors are as follows.
Depository financial institution: a financial institution that accepts deposits and
channels the money into lending activities; "he cashed a check at the bank"; "that
bank holds the mortgage on my home"
According to Dr. Hart
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“Banker or bank is a person
or company carrying on business of
Receiving money and collecting drafts for the
Customers subject to the obligation of honouring cheques
Drawn upon them from time to time by
Customers to the extends of
The amounts available
On their currents
Accounts”
In the words of G W Gilbert
“A banker is a dealer in capital
Or more properly a dealer in money.
He is an intermediate party between the borrower and lender.
He borrows one party and
Lends to the
Another”
Types of Banks
Commercial bank.
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Exchange bank.
Central bank or state bank.
Industrial bank.
Agriculture bank.
Investment bank.
Saving bank.
Central Bank
Every country has its central bank or state bank. Its major function is to carry out
a country’s monetary policy with an aim to safeguard its financial and economic
stability. It has the monopoly of note issue. It is also the custodian of money
market. State bank is the Banks bank and lender to the government.
Commercial Bank
Commercial banks are profit earning concerns. They receive deposits and
advance loans to the borrows. They greatly help in financing for internal and
external trade of the country.
Exchange Bank
The main function of the exchange bank is to finance the foreign trade by the
purchase and sale of foreign currencies in the form of drafts, bills of exchange,
telegraphic transfers. They also perform the function of commercial bank.
Receiving deposits and advancing loans.
Industrial Banks
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Commercial bank cannot afford to block their funds in long term investments. The
industrial banks receive long term deposits and finance the industries by
providing them long term credits. In Pakistan the Industrial bank named as
Industrial Development Bank of Pakistan (I.D.B.P) was established in 1961 for
this purpose.
Agricultural Bank
Agricultural bank provides short and long period loans for financing agriculture. The
agriculturists need short and long term loans for meeting their day to day and long term
requirements for making permanent improvement in the land. In Pakistan Agricultural
Bank is named as Agricultural Development bank of Pakistan (A.D.B.P) and it was
established in 1961
Investment Bank
The main function of investment bank the merchandising of shares and other
securities, managing and distributing the issue of shares and other securities.
Saving Banks
These are the institutions which are sponsored by the government for having
facilities to the people and small means. These banks collect small saving of
people and allow them to withdraw in small amounts. Also another institution i.e.
National Savings is working in the same capacity.
List of Banks in Pakistan
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The market for banks is diverse in Pakistan comprising nationalized commercial
banks (NCBs), Private Banks and foreign banks. In 1993, there were 33
commercial banks in
Pakistan 14 being local and 19 foreign. By the end of 2001, the number of banks
has increased to 43, 24 being local and 19 as foreign.
History Of Banking In Pakistan
Banking in fact is primitive as human society, for ever since man came to realize
the importance of money as a medium of exchange; the necessity of a controlling
or regulating agency or institution was naturally felt. Perhaps it was the
Babylonians who developed banking system as early as 2000 BC. IT is evident
that the temples of Babylon were used as ‘Banks’ because of the prevalent
respect and confidence in the clergy.
The partition plan was announced on June 3, 1947 and August 15, 1949 was
fixed as the date on which independence was to take effect. It was decided that
the Reserve bank of India should continue to function in the dominion of Pakistan
until September 30, 1948 due to administrative and technical difficulties involved
in immediately establishing and operating a Central Bank.
At the time of partition, total number of banks in Pakistan were 38 out of these
the commercial banks in Pakistan were 2, which were Habib Bank Limited and
Australia Bank of India. The total deposits in Pakistani banks stood at Rs.880
million whereas the advances were Rs.198 million. The Governor General of
Pakistan, Muhammad Ali Jinnah issued the order for the establishment of State
Bank of Pakistan on 1st of July 1948.
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In 1949, National Bank of Pakistan was established. It started with six offices in
former East Pakistan. There were 14 Pakistani scheduled commercial banks
operating in the country on December 1973, the name of these were:
National Bank of Pakistan
Habib Bank Limited
Habib Bank (Overseas) Limited
United Bank Limited
Muslim Commercial Bank Limited
Commerce Bank Limited
Australia Bank Limited
Standard Bank Limited
Bank of Bahawalpur Limited
Premier Bank Limited
Pak Bank Limited
Lahore Commercial Bank Limited
Sarhad Bank Limited
Punjab Provincial Co-operative Bank Limited
The Pakistan Banking Council prepared banks amalgamation schemes in 1974
for amalgamation of smaller banks with the five bigger banks of the country.
These five banks are as under:
National Bank of Pakistan
Habib Bank Limited
United Bank Limited
Muslim Commercial Bank Limited
Allied Bank Limited
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So, through the Nationalization of Bank Act 1974, the State Bank of Pakistan, all
the commercial banks incorporated in Pakistan and carrying on business in or
outside the country were brought under the government ownership with effect
from Jan. 1, 1974. The ownership, management, and control of all banks in
Pakistan stood transferred to and vested in the Federal Government. The
Finance Minister announced plans to start Islamic Banking system in Pakistan in
the budget speech on June 26, 1980, but it could not be possible till August,
2003.
State BANK Of Pakistan
The State Bank of Pakistan is the central bank of the country. Usually the starting
point for a central bank is a banking system that is already in place - the banking
system necessitates the presence of a central bank. But the State Bank of
Pakistan (SBP) is unique in the sense that it started its function in a newly born
country, where it also had to shoulder responsibilities of developing and
rehabilitating a banking system and the economy, in addition to the traditional
central banking functions. Performance of the Bank since its inception in 1948,
as reviewed in subsequent pages, shows that it has faced all the challenges with
a great zeal and commitment. The founders of the Bank set a multi-dimensional
target before it that included not only regulation of the monetary and credit
system but also the growth of this system. The vision of its founders was a stable
monetary system in Pakistan with fuller utilization of the country’s productive
resources (SBP Act, 1956).
2.An Overview of Organization
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2.1 History of NIB BANK
NIB Bank Limited started as NDLC-IFIC Bank Ltd.
which was incorporated in March 2003 as a public limited company. It started
operations in October 2003 when all assets, liabilities, rights and obligations of
the former National Development Leasing Corporation (NDLC) and Pakistan
operations of IFIC Bank were amalgamated with and into the Bank with a paid up
capital of Rs.1.2bn. In April 2004 the Pakistan operations of Credit Agricole
Indosuez were also amalgamated with and into NIB. In March 2005 Temasek
Holdings of Singapore acquired 25% shareholding in NIB Bank, through Bugis
Investments. This shareholding was further enhanced to over 70% in June '05
following an increase in NIB's paid up capital to Rs 3.4 bn. NIB Bank has since
grown rapidly from a base of 2 branches in 2003 to 45 in the 4th quarter of
2007, with a corresponding increase in its assets and deposits base.
NIB Bank's vision is to rank amongst the top 5 banks in the country. Therefore
towards the end of June 2007 it acquired majority shares of PICIC with the aim of
merging PICIC and its commercial banking subsidiary PICIC Commercial Bank
Limited (PCBL) into NIB. The acquisition was financed through the country's
largest private sector rights issue, with resultant increase in NIB's paid up capital
to Rs.22.0 bn. The PICIC acquisition bought with it another subsidiary "PICIC
AMC" and an affiliate "PICIC Insurance".
NIB already has a shareholding in NAFA, an Asset Management Company
(AMC) whose shareholders also include National Bank of Pakistan and Fullerton
Fund Management Company; thus NIB Group’s asset management business
has also increased, while it has diversified into the insurance business as well.
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The legal merger of PICIC & PCBL into NIB took place on December 31, 2007,
once all regulatory approvals were in place. NIB Bank continues to be led by
Khawaja Iqbal Hassan, supported by four business heads and ten business
enabling function heads.
The merger resulted in a vastly expanded network of 240 branches and total
assets of Rs 176.6 bn on merger date. NIB has the second highest paid up
capital of Rs. 28.4 bn amongst banks and ranks number 7 in terms of distribution
network. Merger synergies include lower cost deposits, enhanced customer
service delivery channels and overall improved efficiencies. These help provide a
competitive edge in the face of increasing competition in the banking sector.
Temasek Holdings continues to be the largest single investor in NIB Bank with
approximately 63% shareholding.
The powerful franchise of the three merged entities has been brought together to
form a much larger and stronger bank to complete in the market place. Going
forward management is confident that the combined bank will be a top performer
delivering a wide range of financial services through an extensive branch
network. The asset management arms and insurance affiliate are also expected
to perform well and provide an attractive dividend stream for NIB.
Temasek Shareholding
Temasek Holdings is an Asia investment house headquartered in Singapore.
With a multinational staff of 380 people, Temasek Holdings manages a portfolio
of over S$172 billion, or more than US$120 billion, focused primarily in Asia and
Singapore.
Guided by an independent board, Temasek Holdings operates autonomously on
commercial principles to maximize long-terms returns. Its total shareholder
return since inception 35 years ago is more than 16% compounded annually.
Temasek Holdings has a corporate credit rating of AAA/Aaa by Standard &
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Poor's and Moody's respectively.
President
Khawaja Iqbal Hassan: President and CEO
Khawaja Iqbal Hassan is the President and Chief Executive Officer of NIB Bank. NIB Bank is the fastest growing commercial bank in Pakistan and has recently acquired controlling shares in Pakistan Industrial Credit and Investment Corporation (PICIC) and PICIC Commercial Bank. Mr. Iqbal Hassan is the founder of NIB Bank, which he created in 2003 through the merger of Pakistan’s then largest leasing company, NDLC, and the domestic branches of IFIC Bank. This was followed by an acquisition of the domestic branches of the French bank, Credit Agricole Indosuez.
Mr. Iqbal Hassan was the driving force behind the creation of National Fullerton Asset Management Company (NAFA) which is Pakistan’s fastest growing and best performing asset management company. NAFA is a joint venture between NIB, National Bank of Pakistan and Fullerton Fund Management, a subsidiary of TemasekHoldings.
Prior to starting NIB, Mr. Iqbal Hassan conceptualized and founded Global Securities in 1994. Global is one of the largest and most active corporate finance and securities houses in Pakistan. In 1996 Global became a joint venture partner of UBS AG, one of the largest banks in the world and continues to work with UBS AG in Pakistan. Global holds an unmatched s uccess record of having completed over 55% of all privatizations in Pakistan.
Landmark transactions managed by Global include the largest IPO in terms of number of investors (KAPCO); the largest IPO in terms of rupee value (Habib Bank); the largest domestic bond offerings (KESC and PIA); the first sub-debt issue by a commercial bank in Pakistan (MCB); buy-side advisories for the privatization of Habib Bank and United Bank, and domestic advisory on the only exchangeable bond offering for the Government of Pakistan. Global was also domestic advisor for the US$ 2.6 billion privatization of Pakistan Telecom. Global has also served as the adviser for the restructuring of PIA on two occasions.
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Before starting Global Securities Mr. Iqbal Hassan was the Regional Business Group Head and Vice President for Citibank in Pakistan. He was responsible for managing Citibank’s Local Corporate Group, Financial Institutions Group, Product Development and Securities Services Groups. Mr. Iqbal Hassan also served internationally as the Corporate Bank Head and Vice President, in Istanbul, Turkey on secondment to Saudi American Bank, a managed-affiliate of Citibank. Mr. Iqbal Hassan was the founder of the bank in Turkey where he envisioned and implemented the bank’s business plan focused on fee-based merchant banking and commercial banking businesses, fixed income and foreign exchange arbitrage. Prior to that Mr. Iqbal Hassan served as the Unit Head of the Construction Division of Saudi American Bank in Riyadh. He started his banking career at the Special Projects Team in Citibank New York where he was deployed on the task forces that re-scheduled foreign debt and conducted the de-freezing of assets of developing countries.
Mr. Iqbal Hassan obtained his Bachelor of Science degree in Business Administration from the University of San Francisco in 1980 from where he graduated with academic honors and majored in Finance and Marketing. He also holds a degree in Accountancy from the City of London Polytechnic.
In addition to his contributions to the development of the financial and banking sectors in Pakistan Mr. Iqbal Hassan serves/has served as a Board member of the following companies:
NIB Bank Limited.
PICIC.
PICIC Commercial Bank.
PICIC Insurance.
National Fullerton Asset Management Company Limited.
Civil Aviation Authority of Pakistan.
Pakistan Steel Mills Limited.
Habib Bank Limited.
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Global Securities Pakistan Limited.
Citicorp Investment Bank Pakistan Limited.
The Pakistan Fund.
The Central Depository Company of Pakistan Limited.
In view of his contributions to the field of banking and finance, Mr. Iqbal Hassan was conferred the Sitara-i-Imtiaz, Pakistan’s highest civilian award in 2007.
Ownership Profile
NIB BANK LIMITED Stockholders' Information as at March 31, 2010
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Particulars/> Shareholding Percentage
606Associated Companies / Undertakings, Related Parties, Directors, Chief Executive Officer, and their spouse and minor children
3,011,828,360 74.4815
NIT & ICP 34,301,653 0.8483Banks, Development Financial Institutions, Non Banking Financial Institutions
124,895,108 3.0886
Insurance Companies 7,247,594 0.1792Modarabas and Mutual Funds 7,606,338 0.1881
Public Sector companies & Corporations 250,618,626 6.1977General Public (including local & foreign individual) 459,058,320 11.6524Foreign Companies 14,045,558 0.3473Others 134,125,519 3.3169Shares held by 29,429 Shareholders 4,043,727,076 100.0000
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Board Of Directors
Francis Andrew Rozario Chairman
Syed Aamir Zahidi DirectorTejpal Singh Hora DirectorAsif Jooma DirectorMr. Muhammad Abdullah Yusuf DirectorTeo Cheng San, Roland DirectorMr. Najmus Saquib Hameed DirectorKhawaja Iqbal Hassan Director and President / CEO
Internship Report
2.2 Nature of NIB Bank:
Vision and Mission
Our Mission:
To improve the quality of life for millions
Our Core Purpose: Enabling success; Realizing dreams
Our Vision: To be the most admired Financial Institution in Pakistan
Our Values:
PASSION
RESPECT
INTEGRITY
EXCELLENCE
FAIRNESS
Passion
I am driven
I am committed
I am determined
I believe in what I do
I embrace life
Respect
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I appreciate different viewpoints
I am receptive to the diversity of ideas
I treat others as I would want to be treated
I look after the community in which we live and work
I contribute to the care and comfort of those around me
Behaviors: Integrity
I do what I say
I am honest and forthright
I never compromise my values
I am open and honest in all my dealings
I have the courage to stand up for what I believe to be true
Excellence
I strive for better
I exceed expectations
I am constantly improving
I always try to get it right the first time
I produce error free, superior quality work
Fairness
I am impartial
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I judge on merit
I don’t expect favours
I listen to both sides
I reward what you do not who you are
2.3 Features of NIB Bank
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Product Lines:
Salaam Banking
Salaam is an everyday salutation, a special tribute, a mark of admiration,
an expression of respect that is communicated through a gesture, a nod, a
salute or a
handshake.
By saying Salaam we mean to pay homage to the people belonging to self
employed mass market which includes small enterprises as well (retailers,
traders & services). We commit to serve these hard working people with a strong
belief that we are “privileged” to be their banking partner. We will assist them in
their business financial needs by providing them basic and advanced banking
services at their door step and we will do it with dedication and respect because
they value respect more than any thing. Our unique proposition provides our
customers with:
Basic and modern banking facilities.
Account opening with no minimum balance requirement.
Dedicated relationship officers to assist and consult for financial matters.
Branch presence close to customers.
Business loans, insurance and other value added services provided
through one stop shop.
Products Of Salaam Banking
Salaam Business Account
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The Salaam Business Account is a Pak Rupee current account with value
added transactional services designed specifically for the Salaam segment.
Features:
The savers can subscribe to other services including: ATM, Salaam
DirectPay, Salaam Cash Guard, Salaam Committee and Salaam Sahulat
(Cash Collection Services).
Fully dedicated relationship officer for the customer.
No minimum balance requirement.
No limitations on the number of withdrawals and deposits through any
channel.
Benefits:
No online transaction charges through a growing network of Salaam
and NIB Bank Limited branches.
ATMs of all other banks can also be used by paying a nominal charge.
Highlights:
Convenience of monthly bill payments through one-off or standing payment
instructions acceptable at branch and call center as well as all front end
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channels to be added in the future (e.g. mobile banking).
The customer will also be able to make the regular payments for other Salaam
products availed (such as loans and insurance) through direct debits to the
same Salaam Business Account.
Salaam Bachat Account
The Salaam Bachat Account is meant for customers who wish to accumulate and consolidate their disposable income to meet future financial needs.
Features:
A saving account that offers attractive returns without imposing minimum balance requirements.
Benefits:
Will encourage saving habit for customer’s financial security.
Highlights:
The savers can subscribe to other services including, ATM, Salaam Direct pay, Salaam Cash Guard, Salaam Committee and Salaam Sahulat (Cash Collection Services).
Salaam Committee Salaam Committee is a unique product that combines the benefits of a saving
plan with an insurance cover.
It enables households to regularly put aside a portion of their income for savings
to achieve their desired amount while also availing the financial security of an
insurance plan. Salaam Committee enables our valued customers a highly
accessible, convenient and attractive avenue for regular savings by providing
increasing incentives over time.
Features:
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Minimum monthly deposit amount starts from as low as Rs.1000. Save at your convenience and become entitled for bigger bonus (es) as
you continue to save. *
Insurance coverage option available equal to 65 times of the monthly contribution amount.**
Free Current or Savings checking account with all applicable features.
No partial encashment allowed.
In case of encashment the entire scheme would terminate, including the insurance cover. **
No early encashment charges applicable from 7th monthly contribution onwards.
Benefits:
Get additional bonus installments after every 12 payments (first bonus payment
to start after completion of 24 payments. The longer you continue, the higher the
bonus contributions you earn.
The customer can opt for Depositor’s Insurance Option for no extra charges.
This represents coverage for Life and Permanent Total Disability up to 65 times
his monthly contribution or a maximum or Rs. 2 million whichever is lower.
NIB Committee is a unique product that combines the benefits of a savings plan
with an insurance cover.
It enables savers to regularly put aside a portion of their income across their
savings horizon to achieve their desired amount while also availing the financial
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security of an insurance plan.
Pricing
Annualized rate of expected return ranges from 3.90% to 5.15% depending upon
the number of contributions and tenor.
Contribution Deduction Date *
The Monthly Contribution amount will be deducted on the Deduction Date which
is the tenth (10th) of every month from the customer’s specified account or in the
event of insufficient balance being available in the customer’s specified account
on such date, such other two (2) dates as may be determined by the Bank, at
which time the account will be deducted directly to make the Monthly
Contribution payment. Such deduction of the Monthly Contribution amount shall
continue to be valid until the termination of the NIB Committee Plan.
*Revised deduction dates applicable to all existing Customers of NIB Committee
Plan.
Is there any limit to my insurance coverage amount?
Yes, your insurance coverage entitlement based on your age is given below:
Maximum Age
Limit
Maximum Coverage
Amount
Maximum Contribution
Amount
(65 times of monthly contribution amount)
Up to 40 years Rs. 2,000,000/- Rs. 30,500/-
41 to 50 years Rs.1,500,000/- Rs. 23,000/-
51 to 60 years Rs.1,000,000/- Rs. 15,000/-
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3% penalty applicable if encashed any time prior to the completion of 7
monthly contributions.
The scheme automatically terminates on 3 consecutive missed monthly
payments.
WHT applicable on profit on a monthly basis.
Zakat payable as per applicable laws unless exempted.
Annualized rate of expected return ranges from 3.90% to 5.15%
depending upon number of contributions & tenor.
Salaam Fixed Deposit
The Salaam Fixed Deposit will cater to customers who already have
accumulated savings and wish to preserve and increase their value.
Features:
The product will offer a monthly payout option as well as long term
Pay outs at maturity.
Minimum balance requirement is Rs. 5,000.
Benefits:
High rates of return.
Highlights:
The customer will be able to obtain overdrafts against these fixed deposits in
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order to meet short term liquidity needs.
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Mortgage Loan Insurance
NIB is also working towards allowing the customers to fulfill their long term business
needs by offering Cash Against Property, where the customers can avail financial
services and improve upon their business by simply applying for a mortgage loan
along with which you will be able to insure your homes in assistance with the bank.
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Features:
Higher loan amounts.
Longer tenure.
Benefits:
Lower interest rates.
Floating rates will be available in future.
Highlights:
Customized mortgage loan according to customer requirement.
Financing available against residential as well as commercial property.
Salaam CashGuard
Salaam CashGuard safeguards your cash withdrawn through ATMs and Over-the-
Counter against the risks of forced snatching through armed hold-ups or burglaries.
We offer a pre-underwritten insurance coverage in two different packages to our
customers in collaboration with New Jubilee Insurance Company Limited.
Features:
The two plan options available for CashGuard are as follows:
Option/
Coverage
Maximum Cover (ATM & OTC)* Monthly Service
ChargesPer Event Per Year
Plan A Rs. 20,000/- Rs. 40,000/- Rs. 190/-
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Plan B Rs. 50,000/- Rs. 100,000/- Rs. 230/-
*The insurance cover would be applicable for a period of one month (from the date of
enrollment to the same date of the next month), provided that the service charges are
paid for that month
Benefits:
Payments are made automatically by debiting your account.
Convenience at your doorstep.
Quick turnaround time for claim reimbursement.
Coverage for all ATM transactions from any bank in Pakistan.
Coverage for all cash transactions from any NIB branch in Pakistan.
Easy to subscribe and unsubscribe.
Highlights:
Convenience for the customer.
Offers 24/7 coverage for all your cash transactions.
ATM
Features:
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Make Cash Withdrawals
Get access to your accounts and make cash withdrawals 24x7.
Per Transaction Limit: Rs. 20,000.
Daily Limit: Rs. 50,000.
Pay Bills
Add, View and Pay your Utility & Mobile Bills, Reload / Top-up your Prepaid Mobile
connections.
Utility Companies – SSGC, SNGPL, KESC, PTCL, IESCO, HESCO and GEPCO
Mobile Companies – Ufone, Mobilink.
Prepaid Vouchers
Buy Prepaid Electronic Vouchers of ISPs, Calling Cards and Mobile Phones.
ISPs (Gerrysnet, Cybernet, Onspeed).
Calling Cards (PTCL & VPTCL)
Mobile Vouchers (Mobilink, Ufone, Zong, Telenor, Warid).
Funds Transfer from NIB to Other Banks
Through Inter Bank Funds Transfer from NIB to any 1-Link member Bank.
Per Transaction Limit: Rs. 50,000.
Per Day Transaction Limit: Rs. 250,000.
Transfer Funds within NIB
Instant funds transfer from NIB-to-NIB Accounts.
Per Transaction Limit: Rs. 50,000.
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Per Day Transaction Limit: Rs. 250,000.
Balance Inquiry
Keep an eye on your accounts and balances with the Balance Inquiry facility available
at NIB ATMs.
Mini Statement
Print last 10 Transactions of your account anytime.
PIN Change
Change your ATM PIN at your convenience.
Salaam CashGuard
An optional Cash withdrawal ATM Insurance service that allows the customer to be
covered for any unfortunate event of having their money snatched after an ATM
transaction.
Salaam DirectPay
A hassle free bill payments and transfers facility whereby customers can pay their utility
and mobile bills and transfer funds at their own convenience. Life
DirectPay offers the following services:
Electronic fund transfers.
Prepaid vouchers.
Utility bill payments.
Mobile bill payments and top-up
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Phone Banking
Bank at your convenience
NIB Phone Banking is a distinctive and efficient 24/7 Non-Stop Banking service available
for NIB customers. It is a virtual medium for existing and prospect customers to fulfill
their day to day financial needs through the telephone.
SCall our phone banking at 0800-00039 and make use of our phone banking for the
following:
Product Information
Loan Account Information Product Information
Application Status
Installment Repayment Inquiry
Branch Banking Information
Deposit Account Services Account Inquiry
Balance Inquiry
ATM Card Services ATM Card Activation
ATM Card Blocking
ATM PIN and TPIN Generations
ATM Card status and inquiry
ATM cash disputes
Updating customer personal information
Value Added Services
DirectPay - Bill Payments Funds Transfers
Bill Payments
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Mobile top up and other payments
CashGaurd – ATM insurance Inquiry
Complaints
Activations
Deactivations
IVR Services TPIN and ATM PIN Change
Loan Installment Details
Last 5 transactions
Balance Inquiry
Salaam DirectPay
Salaam DirectPay is a convenient bill payment and funds transfer facility whereby you can
instruct instant payment of your bills and transfer funds from your NIB bank account at
your own convenience and luxury.
Your payments are made quickly and conveniently, and you no longer have to track
payment due dates, wait in long queues or suffer late payment charges. You can easily
pay your bills or transfer your funds through ATMs and/or Phone Banking 24 hours a day,
7 days a week. You can also ensure automatic payment of your bills and transfer of funds
from your NIB bank account by setting up direct debit
instructions and specifying your payment schedule.
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Features:
Salaam DirectPay offers the following services:
1. Utility Bill Payments
This service is available at NIB ATMs, Phone Banking and Branches. It is
available for both one-off and DirectDebit and only for the following companies:
KESC.
SSGC.
SNGPL.
PTCL.
IESCO.
HESCO.
GEPCO.
2. Mobile Bill Payments and Prepaid Mobile Top-up
This service is available at ATM, Phone Banking and Branches. It is available for
both one-off and DirectDebit and only for the following companies:
Ufone.
Mobilink
3. Fund Transfers
Within NIB This service enables customers to transfer funds from their NIB
account to any other NIB account. This service is available at ATMs, Phone
Banking and Direct Debit.
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Inter-Bank Funds Transfer
This service is only available at ATMs and only for transfers to accounts of the
following banks:
Royal Bank of Scotland (formerly ABN Amro)
Askari Commercial Bank
Allied Bank
Bank AL Habib
Bank Alfalah
Bank Islami Pakistan Limited
Habib Bank Limited
Soneri Bank Limited
Tameer Micro finance Bank Limited
Union Bank Limited / Standard Chartered
United Bank Limited
ATMs MobileMobile Prepaid vouchers for the following companies are available through Life
DirectPay.
Warid.
Mobilink.
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Zong.
Ufone.
Telenor.
Internet
Internet Prepaid vouchers for the following companies are available through Life
DirectPay.
Cybernet.
Gerrysnet.
On Speed.
Si3.
Calling Cards
Calling Card vouchers for the following companies are available through Life
DirectPay.
PTCL.
VPTCL.
Lifebanking
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Lifebanking will assist you in managing all your banking needs at
your office, you no longer have to stand in long queues or get stuck in traffic
jams. With your busy working schedule, Lifebanking would take care of all your
financial matters giving you more time to spend with your dear ones.
We aim at becoming your sole banking partner so you can enjoy every moment..
Lifebanking offers solutions for cash flow requirements, saving & investment
needs and for day to day financial transactions.
If you are a salaried individual, Lifebanking offers you:
Life Salary Account: One account from where you can manage your entire
monthly expenses.
Services at your office.
Assistance in saving for future.
Wide range of financing available to cater to all your needs.
Automatic payments for utility bills & monthly installments.
More than 100 ATMs across Pakistan
Products Of Life Banking
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Life Salary Account
Life Salary Account is a PKR current account that will provide the convenience of
managing the cash outflows for the month. Every month the companies would
either disburse your salary in these accounts or you can directly deposit it in your
Life Account.
Payment of utility bills, fees, loans etc, would be tagged to this account. If you
want us to save for you, we will maintain a certain amount each month. Products
and services availed by the employee would be tagged to this account and
individual can manage all
bill/fee payment, savings and investment and repayments via this account.
Features:
A current account with zero minimum balance requirement.
Free of charge ATM card for your usage.
Automatic payments of bills and fees.
Benefits:
Hassle free payments for your dues directly through your account.
All products and services tagged to your salary account.
NIB Tajir
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A Current Account for businessmen on the go!!
NIB Taajir Account is a business transaction management tool; a current account
that provides convenience to you to facilitate your business by managing the
cash outflows and inflows.
This account offers various features and benefits that enable a business to fulfill
all banking requirements ranging from payments to receipts; which include
payments to suppliers, vendors, utilities, service providers and salary
disbursement to employees. On the receipts side it includes collection and
management of receivables.
Tagged Products and Services
NIB Connect – Interbank Funds Transfer Facility
NIB Protect – Cheque Bounce Protection Facility
NIB Direct – Bills Payment and Funds Transfer Facility
NIB Sahulat – Cash Collection from customer premises
NIB Alerts – SMS & e-statements
NIB PaySys – Automated Salary disbursement Solution
Product Offering
Free Online Banking
Taajir account can be accessed from all NIB branches for the purpose of account
information, deposits, withdrawals, funds transfer, etc.
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Free Cheque Book (First)
First cheque book will be issued free of cost consisting of 25 leaves, all
subsequent cheque book issuance will be charged as per respective segment
SOC.
Free Pay Order Issuanc
Making payments via payorder is easy and cost effective for NIB Taajir account
holders.
Free Demand Draft (Drawn on NIB Branches)
Demand Draft issuance will be charged as per the respective branch segment.
Prepaid Vouchers and Other Payments)
ATM or call center. Through direct pay you can pay utility bills, mobile bills, get
prepaid vouchers and make payments to other NIB accounts. The facility is
available free of costto all Taajir account holders.
NIB Sahulat* (Cash Collection Facility from Customer Premises)
NIB Saluhat offers the convenience of cash collection from your business
premises upto a maximum amount of Rs.500,000/- per visit, automated deposit
slip is issued to the customer through a POS machine at the customer premises.
*Charges applicable as per SOC
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Life Profit Account
Life Profit Account is a PKR saving account providing saving avenues for the
salaried individual.
With minimal balance requirement and ease of opening this account the
customer can start depositing the monthly small contributions to this account and
earn profit based on daily balance on these savings.
Features:
Profit account opened with a balance of Rs. 5000.
Saving amount can be transferred to Life Profit Account simply through
Payroll Accounts.
o Inter Bank Funds Transfer – Banks on One link and IBFT certified.
o Cheque.
o Cash
Life Committee
It enables households to regularly put aside a portion of their income for savings
to achieve their desired amount while also availing the financial security of an
insurance plan. Life Committee enables our valued customers a highly
accessible, convenient and attractive avenue for regular savings by providing
increasing incentives over time.
Features:
Minimum monthly deposit amount starts from as low as Rs.1000.
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Save at your convenience and become entitled for bigger bonus(es) as you
continue to save. *
Insurance coverage option available equal to 65 times of the monthly
contribution amount. **
Free Current or Savings checking account with all applicable features.
No partial encashment allowed.
In case of encashment the entire scheme would terminate, including the
insurance cover.
No early encashment charges applicable from 7th monthly contribution onwards.
The contribution will be deducted on the tenth (10th) of every month or in the
event of insufficient balance being available on the 10th , on any such other two
(2) dates of that month as may be determined by the Bank.*
Applicable after completion of 24 payments, bonus increases after every 12
contributions.
Benefits:
Get additional bonus installments after every 12 payments (first bonus payment
to start after completion of 24 payments. The longer you continue, the higher the
bonus contributions you earn.
The customer can opt for Depositor’s Insurance Option for no extra charge. This
represents coverage for Life and Permanent Total Disability up to 65 times his
monthly contribution or a maximum or Rs. 2 million whichever is lower.
Life Committee is a unique product that combines the benefits of a savings plan
with an insurance cover.
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It enables savers to regularly put aside a portion of their income across their
savings horizon to achieve their desired amount while also availing the financial
security of an insurance plan.
Highlights:
Life Committee provides for a Forced Savings Avenue for the customers.
It also allows the customers the Convenience to contribute to their
growing savings.
It provides Safety and Security of your money with a reputable
organization.
It provides Free insurance coverage incase of an unforeseen event.
It provides for Growth in savings with bigger bonuses over time.
It provides Free checking account facility without minimum balance
requirement.
Pricing:
Annualized rate of expected return ranges from 3.90% to 5.15% depending upon
the number of contributions and tenor.
Life Personal Installment Loan
Life Personal Installment Loan provides personalized financing so you can
quickly pay off your liabilities, meet marriage expenses, make vital investment in
your child’s education or simply refurnish your house.
Life Corporate Loan
Life Corporate Loan is an installment based loan for salaried individuals, secured
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by the employer guarantee.
This facility is only available to employees of companies having secured loan
agreement with NIB Bank Limited. This loan would assist in meeting short-term
and long-term needs of a salaried individual without having any impact on the
provident fund balance accumulated and the returns on the provident fund.
Features:
Financing facility up to Rs. 500,000.
Credit Life Insurance option can provide security to you and your family in
times unfortunate events.
Free Life Current account with no minimum balance.
Peace of mind provided to you by managing your payments through Life
Current Account.
Loans at lower interest rates.
Life Auto Financing
NIB Auto Finance is an installment based financing and provides you with the
facility of buying a new or a used car with a minimum 10% down payment with
other product benefits.
Life Salary Advance
Overview
Life Salary Advance allows eligible customers to withdraw up to 25% of their net
monthly salary or a limit of PKR 100,000 whichever is lower by paying a minimal
upfront fee. This facility is valid for the entire month and the limit is refreshed
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when the customer’s salary is disbursed.
Features & Benefits:
Only for customers whose company payroll is with NIB Bank
Customers are pre-approved
Facility valid for 1 month; refreshed when salary is disbursed
Facility valid for 1 month; refreshed when salary is disbursed
Limit is up to 25% of net salary or PKR. 100,000 whichever is lower
Utilized amount is recovered through subsequent salary disbursal
Fee is deducted upfront from desired amount
Available only on NIB ATMs
Life Mortgage
Overview
Finding a competitive home loan which serves all of your needs is hard to come
by. Life Mortgage Loan is the answer to all your troubles. Just choose your ideal
home and we will do the rest! From initial documentation to the final
disbursement, you will experience seamless customer service. Read on for all
your queries.
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The following branches provide Life Mortgage facilities:
Landhi Branch,Karachi Clifton Branch,Karachi
Khalid Bin Walid Br.,Karachi Rashid Minhas Road,Karachi
SITE Branch,Karachi Korangi Industrial Area Branch,Karachi
West Wharf Road
Branch,KarachiNorth Karachi Industrial Area Branch,Karachi
Feature & Benefits
Types of Facilities offered:
Buy a Home:
A Mortgage loan specifically devised for customers who want to buy or build
their ideal home.
Balance Transfer Facility
By availing the BTF, customers can transfer their mortgage home loan to NIB
Bank.
Financing Limits and Security:
The loan granted under Life Mortgage will be secured against residential
property only. The financing limits will be based on the type of collateral ranging
from Rs. 500,000 to Rs. 20 Million*
(Limits are subject to type of collateral)
Tenure:
Minimum: 3 years Maximum: 20 years
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Moral Values of Employees:
Moral values of employees are very high and these moral values include.
PASSION
RESPECT
INTEGRITY
EXCELLENCE
FAIRNESS
2.4 Competitors:
The main competitors of the bank are:
Askari Commercial Bank.
Union Bank
Prime Commercial Bank.
Muslim Commercial Bank
Allied Bank
Al falah Bank
Soneri Bank
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3.Organizational StructureHierarchy Chart
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President / CEO
Group Leader
Cluster Manager
Manager
Relationship Manager
Operation Manager
Counter Service Supervisor
Counter Service Officer
Branch Service Officer
Personal Banking Consultant
Date Center Incharge
Internship Report
3.2 Number of Employees:
The overall Staff at NIB Bank branches are detailed below.
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(Numbers)
STAFF STRENGTH 2009 2008
Permanent 4,925 5,131
Temporary / on contractual basis 72 142
Group's own staff strength at the end of the year 4,997 5,273
Outsourced 1,430 1,656
Total staff strength 6,427 6,929
Trer are 34 employees in the branch where I did my internship.
3.3 Main Offices:
To cater to the diverse financial needs of the businesses spread across the
country, NIB has established five corporate centers in major Business and
Industrial hubs as follows:
Karachi:
Address: Muhammadi House, I.I.Chundrigar Road, Karachi.
UAN: 021-111-333-111
Direct: 021-32469413 / 32427413
Fax: 021-32415582
Lahore:
Address: NIB House, 2nd Floor, 14-A, Old Race Course Road, Shahrah-e-Awan-
e-Tijarat, Lahore.
PABX: 042-99200522
Direct: 042-36282731-4
Fax: 042-99201993
Islamabad:
Address: 1st Floor, Post Mall, F-7 Markaz, Islamabad.
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UAN: 051-111-333-111
Direct: 051-2608001-4
Fax: 051-2653448
Faisalabad:
Address: NIB Liaquat Road Branch, Faisalabad.
UDirect: 041-2610406 / 2620268
Multan:
Address: 66 Abdali Road Branch, Multan.
UAN: 061-111-333-111
Direct: 061-4781454
Fax: 061-4583041
3.4 Introduction of all departments
There are 3 main departments at the branch:
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1. ACCOUNT OPENING DEPARTMENT.
2. OPERATIONS DEPARTMENT.
3. TRADE FINANCE DEPARTMENT.
ACCOUNTS OPENING DEPARTMENT
Account opening Department is considered a blood-pumping instrument (heart)
in the banking sector. This department is considered very important in consumer
banking because it serves as a liaison between the customers and the bank.
During my training in this department I have learned a lot of things a few of which
are following.
The prospective customers who approach the bank for the purpose of account
opening are of several categories. For example, individual account holders and
corporate account holders. Corporate account holders are subdivided into
several categories such as
There are different requirements for different categories. Individual accounts are
on the name of persons while corporate accounts are on the name of business.
For the account opening of corporate customers several documents are required
like the certificate of incorporation etc. The higher the level of business the
complex is the requirements of account opening. In addition to account opening
this department is also responsible for issuance of chequebook, issuance of
loose cheques and issuance of account statements.
RULES FOR OPENING & OPERATION OF PLS ACCOUNTS
The procedure of opening the current and saving accounts is same, which
is as follows:
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1) The Accounts may be opened on an application made on the bank’s
prescribed account opening form.
2) The accounts may be opened in the name of an individual, jointly in the
names of two or more persons. These accounts may also be opened by the
charitable institutions or for provident fund & other funds of benevolent
nature by local bodies, autonomous corporations, companies, associations,
societies and education institutions.
3) The account should be opened after obtaining a proper introduction.
4) Not more than one account may be opened in any one name except in
cases where such accounts are opened in the name of parent or guardian
for more than one child.
5) A verified copy of National Identity Card should be obtained while opening
the account.
6) A distinctive number will be allotted to each account.
7) The signatures of account holder should be admitted on the AOF and SS
cards.
8) The signatures of the introducer should be verified on the AOF.
OPERATIONS DEPARTMENT
FUNCTIONS PERFOMED:
CLEARING
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REMITTANCE
Clearing
Inward clearing
Outward clearing
Inward clearing
In the morning, the bank receives its own cheques, which have been presented
by the customers in some other bank to be deposited in their account. NIFT
provides the facility of bringing cheque for inward and also takes the cheques of
outward clearing to other banks. The cheques received in inward clearing are the
cheques drawn on bank and the bank has to pay for them. For this purpose the
bank makes clearing in computer by checking the balances of the respective
customer, if their balances are up to the mark then that cheque is cleared and the
respective customer account is debited with the respective amount. If the
balances are short then that cheque is bounced back to the related bank.
Outward clearing:
Brighter Future All the cheques of other banks which are deposited to FBL are
presented in outward clearing. This is said as outward clearing because they
are presented on the very next day after depositing a cheque.
In outward clearing, the entry is made like:
Customer Account Cr.
State Bank of Pakistan Dr.
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This entry is made when we come to know about the clearing of all cheques,
which are sent to other banks.
Services provided
I. TRANSFER OF AMOUNT
II. TELLING ACCOUNT BALANCES
III. ISSUING CHEQUES BOOKS
I. TRANSFER OF AMOUNT
If a customer holds two accounts in the bank and he/she wants to transfer money
from one account to other account, customer writes a cheque and fills deposit
slip in which he/she writes account number to which amount is to be transferred.
After making transfer entry in the computer, affix transfer stamp in the middle of
the cheque, crossing on the upper left and bank’s endorsement stamp on the
backside of the cheque.
Ii. Telling account balances
Whenever clearing officer receives phone call from the customer inquiring about
his/her account balance after confirming the name, address and other
information he tells the balance through computer.
Iii. Issuing cheque books
It is also the duty of department to issue a chequebook when an officer receives
request from the customer.
Remittance
Following are the functions of remittance department
Recovery of various charges as per schedule of charges
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Issuance of Demand drafts, Pay orders and Telegraphic Transfer:
Lodgment of outward bills and follow up for recovery
Telegraphic transfer
TT is prepared against cash or cheques. The Telegraphic Transfer is the
quickest and the most rapid mode of remitting money from one place to another.
Under T.T. the remittance takes place through telegram, telex, cable and in some
instances, on telephone. The applicant fills the application form specifying the
name of the payee, place of transfer and the amount.
The T.T. is issued in a particular tested message and under a test number.
The drawee branch makes payment only after the verification of the test
number.
Demand drafts
A bank draft is an order instrument issued for payment of a certain sum of money
to or order of a certain person and draws on one office of the bank by another
office usually. Unlike a cheque DD is bank’s liability and the bank has the
responsibility concerning payment. A customer prepares a DD from the bank
in case the payment is certainly to be made. Unlike a cheque there is no
problem of refusal of payment, due to various reasons such as insufficiency
of funds etc. In this case both the payer and the payee are the account
holders of the same bank but in different cities.
The drafts may be drawn on offices of other banks under the agency
arrangements. There are three parties to the draft:
DRAWER: Issuing bank
DRAWEE: The bank on which the draft is drawn.
PAYEE: The named person to whom the payment is to be made.
Bank issued a Demand Draft when it received a written request either on
the bank’s standard application form or on a separate paper signed by the
applicant enclosed with cash or cheque covering the amount of the draft
and other charges of the bank.
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Pay order
A “Payment Order” is an instrument drawn by a Bank on itself. It is issued
when the funds are intended to be remitted within the city. The payment
orders are generally issued for anyone of the following practical purposes:
a. To facilitate all locally payable expenses on account of a bank for the
reason that such payments are not executed through cheques,
b. For the sake of inland and foreign remittances in cases where the
beneficiaries do not maintain account with the bank.
c. For all local payments under instructions of the customers for sundry
purposes like payment of insurance premium, payments to third parties,
club bills, rent and taxes, etc.
Pay order is the account payees only mean it is only pay to the person who’s
name is written on the pay order. It is issued by the bank after filling a specific
form by the customers.
Foreign telegraphic transfer (ftt)
As per instructions of the account holder in foreign currency, the bank arranges
the transfer of the stated currency to the desired bank in the respective country.
Depending upon the particular type of currency the telex is sent to a bank in
the country, to which the currency belongs and in that country the bank has
the account with number of banks, which act as its correspondents.
Foreign Telegraphic Transfer is also known as FTT. The customers, who want to
transfer the funds from Pakistan to other country, have to inform the bank.
Because this department has to inform to Treasury department in Head Office to
arrange the transfer of funds, which is directly involved in the respective
transaction, as the function of the treasury department is to monitor the local
and foreign currency accounts of all the branches of the bank. Moreover it
also monitors the details pertaining to these accounts such as availability of
funds etc. In other words we can say, this department informs the treasury
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Trade Finance Department
Import Department
Export Department
Internship Report
department that this much amount of foreign currency should be arranged in
desired country where the funds are to be transferred. Moreover the customer
who wants to transfer the funds should have a foreign currency account in the
bank. Because State Bank made the restriction that foreign transaction is only
done through the foreign currency account.
Foreign demand draft (fdd)
Foreign demand drafts are issued when bank received an application on a
specific form and a letter printed on a letter pad of the company with authorized
signatures. FDD issued to only those customers who have a foreign currency
account in the bank. For the issuance of FDD customers have to inform the bank
before 11:30 am, because this department has to inform to treasury that we will
issued that numbers of FDD drawn on these banks. After receiving this
information the treasury department arranged the funds in the related
correspondence banks out side the country.
TRADE FINANCE DEPARTMENT
This trade finance department is divided in two sub departments
Import department
This import department consists on two persons. They both are the officer’s
imports and Mr. Khursheed Alam who is Operations Manager supervises them.
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PROCESSING OF DOCUMENTS AGAINST L/CS:
SBP may consider applications for advance remittance up to USD 10,000 against
imports where the goods are of a specialized or capital nature. In the event of
total or partial loss of goods it is the importers responsibility to recover claim from
insurance/shipping/ Supplier Company as the case may be.
Each of the four functions of the Import Department are discussed with reference
to
Import Policy
SBP regulations
UCP 500 regulations
Nib Bank internal requirements and procedures
Procedure
Issuance of the import limit
Establishment of LC
Opening of LC
Issuance of shipping guarantees
Retirement of LC
L/C Opening: Import Policy
No L/C can be established for goods which have either been shipped or
have arrived in Pakistan except with special permission.
All importers while applying for establishment of L/C shall produce a valid
certificate of membership of at least one of the trade organizations
licensed and recognized by the Federal Government
If shipment is made before the date of the opening of the L/C the importer
must deposit surcharge equivalent to 1% of the C&F value of goods
Valid original/copy of category pass book is required
All imports shall be made at the most competitive prices
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Import of items valued up to USD 10,000 or equivalent amount shall be
allowed against Fcy demand draft instead of L/C
For import of machinery against cash by commercial importers all banks
shall open direct L/C as per provisions of import policy
The designated pre-shipment inspection agencies are:
i. COTECNA for European and
ii. Middle Eastern countries
iii. SGS for Asian, Australasian and American countries
Pre-shipment inspection is not required for imported goods that are less
than $3,000 or equivalent amount in total value
SBP H.S. code provided to make sure that the goods are not on banned
list
Performa invoice reference and date match L/C application
EXPORT DEPARTMENT
Requirements for Export of Goods
The exporter is not eligible to export the commodity until and unless he
has an export license and is duly registered as an exporter with the “Chief
Controller of Imports and Exports”.
One should have a registered firm on basis of sole proprietorship,
Partnership or corporation.
A partnership deed has to be signed with the registrar of firms under the
partnership act (1935) and as a result a form-c is issued. According to
which the exporter can export.
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National Tax Number (NTN) is issued after the registration from the
income tax office.
Opening of foreign currency account in the bank is necessary. It is must
that the bank gives a “financial Credibility certificate” to the exporter so
that he can carry out its operations smoothly.
Exporter must also have an “Certificate of Association” in accordance with
the type of the industrial commodity to be exported.
REALIZATION OF EXPORT PROCEEDS
1. State Bank requires that full export value of goods exported from Pakistan should
be received within a period of four months from the date of shipment.
2. If the tenor of document is 120 days from shipment date then repatriation of
funds can be extended to 135 days.
3. Prior approval must be obtained from State Bank if the tenor of document is more
than 120 days from shipment date.
4. If payment is not realized within the prescribed time or short payment is realized,
then Authorized Dealer has to obtain an explanation letter of exporter and furnish
this to the State Bank.
Procedure for exporting of goods
The exporter sends the pro-forma invoice to the importer on the basis of which
the importer processes all the related documents through its bank. After the
process of the documents at the end of the issuing bank the “advisory Bank”
sends the documents to the exporter.
The exporter after receiving documents from the “Advisory Bank” presents them
to its bank that is named as “Negotiating Bank”. The negotiating bank claims the
payment from the reimbursing bank and after getting the payment pays back to
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the exporter. The negotiating bank after negotiating the documents and charging
the negotiation commission sends these documents to the issuing bank. The
negotiation includes the checking of all the documents and to make certain that
those are not in negation. In case any sort of discrepancy exists the bank sends
those documents on collection or approval basis to the issuing bank. If the
negotiating bank sends the discrepant documents then it is the responsibility of
that bank in case of any sort of major problem. The shipment is affected through
the Vessel, Plane or Railway.
III.5 Comments on Organizational Structure
Efficient staff.
Bank Alfalah offers its respective clients calendars, New Year table calendar
and key chains etc free of cost.
A very high level of secrecy is maintained.
A verified statement requisition is required to obtain statement of account
from the customers each time.
Branch Manager regularly informs the employees about positive and
negative points.
4.work done by Internee
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In terms of policy and instruction of Commmerce, I have undergone for 6 weeks
internship with NIB Bank Mian khan road Branch Distt. Sargodha.
I reported at the Branch on 7 july 2010. I was really astonished to see the
building of this Branch outward and inward at a first look and its location at a
prominent place on Mian khan Road. A part from cleanliness and tidiness of the
Branch the atmosphere and dealing of the staff with their clients was a surprising
factor for me and it has given
me a good understanding that how the commercial institutions are extending
services to the people.
On the very first day of my joining, the Manager of the Branch Mr. Raja Qaiser
depicted brief introduction of
NIB Bank Limited
The definition of the Bank
The Departments of the Bank
And different types of services being rendered by NIB Bank to the people.
My participation in the bank
The first day in the bank branch manager introduce me about the bank
employees and their work. I have done various types of assignments regarding
the bank work which have assigned me the different officers of the bank. The
details of my work is as under:
1) Debit credit rules of the bank
There are two types of deposit registers in the bank one is called daily
transaction register and other is called ledger because there is two way entry
process in the bank. Cashier of the bank post the entries on daily transaction
register. The register is divided into two parts receipts and payments
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respectively. When the bank receive some deposit the casher made the entry on
receipts side means the cash is debited while when the bank made some
payments the entry is passed on the payments side the cash is credited. The
difference between the receipts and payments is the cash balance and that
balance is carried forward and the opening balance of the next day. Actually the
daily transaction register is the book of bank transactions records while the
ledger is the book of customer’s record and their entry process is totally reversed
to the daily transaction record register. When some one deposits the cash, his
account is credited with the particular (by cash) and when some withdraw the
cash his account is debited with the particular (to check).
2) Learning about account opening process.
3) Learning about deposit management system (DMS).
4) Information and learning about the bank registers records which are
given below:
Daily transaction register, Deposit ledger, Interest ledger, OBL(Old Balances of
Loan) register, Save File register (after sanctioning of loan the file is called save
file), Loan Application register, Computerization Number of Loan Case (LC.no)
register, Delivery document register, account opening register (current, MM.PLS
and RBA), Issuance of Check Book register, Utility Billing register, Crop
Insurance register, Dispatch register.
5) Learning about the formula and calculation of interest rate. The
formula is given below.
Days multiply by amount multiply by mark up (in percentage) divided by umber of
days in a year. For example the amount is Rs. 45000/- and we want to find out
the interest (mark up) of 120 days while the interest rate is 9%. Then arcading to
formula the equation is:
R (mark up) = 120*45000*9 / 365*100 = Rs.1331.50/-
6) Scanning of account opening forms for the entry process in DMS.
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7) Posting of interest in all the development and production loans
ledgers (14 ledgers and each contain about 1000 pages).
8) DMS Balance matching with all deposit ledgers. There are about 34
running ledgers in the bank.
9) Learning about filling of deposit slip. There are following
requirement to fill the slip:
Account number, name, address, date, branch name, ledger folio (L/F), amount.
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5.Financial AnalysisINVESTMENTS
Investments are made by the banks in order to secure themselves and earn
some profit from it. Generally these investments are done in government
securities and shares. NIB bank invested its money in the following types of
securities;
1. Market treasury bills
2. Preference shares
3. Ordinary shares of listed companies
4. Pakistan Investment bonds
5. Term finance certificates and
6. Investments in Associates
The Market Treasury Bills and Pakistan Investment Bonds are held by the State
Bank Of Pakistan which are eligible for rediscounting. The market treasury bills
matures within 3 to 12 months yielding 8% to 9% markup while the Pakistan
Investment Bonds matures in 7 to 8 years carrying 8% of markup per annum.
2004 2005 2006 2007 2008
1,187,529
5,129,285
6,594,036
40,439,935 35,176,8
23
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RUPEES IN --- 000 ---
YEAR 2004 2005 2006 2007 2008
INVESTMENTS 1,187,529 5,129,285 6,594,036 40,439,935 35,176,823
Interpretation
As we can see from the above graph that the investments especially in the government
papers were round about 1 billion in 2004 it is just because that at that time it was a new
bank just starting off its business however in the next year 2005 the NIB bank rose its
investments to 5 billion and kept on rising it in 2006 as it were 6.5 billion approximately.
Similarly we can see that there is a huge fluctuation in 2007 and 2008 it’s just because of
the fact that the NIB bank acquired the PICIC commercial bank. But however these
investments were declined from 2007 to 2008 from 40 billion approx to 35 billion
approx. it is because of the economic melt down and recession originating from the west
which affected the whole world so as Pakistanis banks as well.
DEPOSITS
Deposits are the liabilities of a bank which is the main source of raising the funds.
These funds are further lend to the other customers on a rate higher on which
they are raised from the depositors. Deposits are the core ingredient of the
banking business without which a company can’t be called a bank. Deposits are
of two main types;
1. DEMAND DEPOSITS
These deposits are further classified to;
a) Current deposits
b) Saving deposits
2. TIME DEPOSITS
These deposits are further classified to;
a) Notice term deposits
b) Fixed term deposits
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RUPEES IN --- 000 ---
YEAR 2004 2005 2006 2007 2008
DEPOSITS 10,648,570 22,554,274 30,566,540 116,671,219 104,586,167
Interpretation
The above graph shows gradual increase in deposits from 2004 to 2006 but the
jump of the graph form 2006 to 2007 is just because of the fact that in this year
NIB bank acquired PICIC commercial bank. So the deposits came under its
umbrella. The decrease in deposits from 2007 to 2008 shows the inefficiency of
the bank to attract more deposits rather they decreased from 116 billion to 104
billion.
ADVANCES
Banks after accepting deposits disburse the money In the form of loans to
generate the profit from. However besides this function banks also perform other
different functions and disburse its collected funds in different areas. These areas
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2004 2005 2006 2007 2008
10,648,57022,554,274
30,566,540
116,671,219104,586,167
DEPOSITS
Internship Report
come under the umbrella of the advances. Advances of NIB Bank includes
disbursement of funds in the following areas;
a) Loans, cash credits and running finances (inside or outside Pakistan)
b) Net investments in finance and lease (inside or outside Pakistan) and;
c) Bills discounted and purchased (excluding treasury bills)
RUPEES IN --- 000 ---
YEAR 2004 2005 2006 2007 2008
ADVANCES 11,737,275 19,622,929 31,052,169 81,932,379 80,344,193
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2004 2005 2006 2007 2008
11,737,27519,622,929
31,052,169
81,932,37980,344,193
ADVANCES
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Interpretation
We can see from the graph that at the time 2004 the advances are the lowest
because at that time it was just like an infant baby, it was newly formed bank
gradually NIB bank started its business and we can see that further to the next
years its graph is going on rising. In 2007 the acquisition of PICIC commercial
bank by NIB bank took place so that’s why the graph jumped high in 2007.
RUPEES IN --- 000 ---
YEAR 2004 2005 2006 2007 2008
Provisions 73,255 91,288 269,583 1,494,801 9,657,400
PROVISIONS AGAINST NON PERFORMING LOANS
2004 2005 2006 2007 2008
73,255 91,288 269,583
1,494,801
9,657,400
Provisions
RATIO ANALYSIS
Financial ratios are useful indicators of a firm's performance and financial
situation. Financial ratios can be used to analyze trends and to compare the
firm's financials to those of other firms. Ratio analysis is the calculation and
comparison of ratios which are derived from the information in a company's
financial statements. Financial ratios are usually expressed as a percent or as
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times per period. Ratio analysis is a widely used tool of financial analysis. It is
defined as the systematic use of ratio to interpret the financial statements so that
the strength and weaknesses of a firm as well as its historical performance and
current financial condition can be determined. The term ratio refers to the
numerical or quantitative relationship between two variables. With the help of
ratio analysis conclusion can be drawn regarding several aspects such as
financial health, profitability and operational efficiency of the undertaking. Ratio
points out the operating efficiency of the firm i.e. whether the management has
utilized the firm’s assets correctly, to increase the investor’s wealth. It ensures a
fair return to its owners and secures optimum utilization of firm’s assets. Ratio
analysis helps in inter-firm comparison by providing necessary data. An inter firm
comparison indicates relative position. It provides the relevant data for the
comparison of the performance of different departments. If comparison shows a
variance, the possible reasons of variations may be identified and if results are
negative, the action may be initiated immediately to bring them in line. Yet
another dimension of usefulness or ratio analysis, relevant from the View point of
management is that it throws light on the degree efficiency in the various activity
ratios measures this kind of operational efficiency.
A. Liquidity Ratios
B. Profitability Ratios
C. Market Ratios
D. Income over Expense Ratio
A) LIQUIDITY RATIOS
Liquidity ratios measure a firm’s ability to meet its current obligations. These
include:
Advances to Deposit ratio:
This ratio shows the ratio of advance to deposits which means that how
much advances were made with respect to deposits.
Formula is
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Advances to Deposit ratio = Total advances (in the year)
Total deposits (in the year)
2004 2005 2006 2007 2008
1.1
0.870000000000002
1.01
0.700000000000001
0.770000000000003
adv/dep ratio
Rupees in --- 000 ---
YEAR 2004 2005 2006 2007 2008
Advances 11,737,275 19,622,929 31,052,169 81,932,379 80,344,193
Deposits 10,648,570 22,554,274 30,566,540 116,671,219 104,586,167
Ratio 1.10 0.87 1.01 0.70 0.77
Interpretation
As we can see from the above graph that the net advances in 2008 are 80.34
billion which is 2% less than the previous year. In reality the surge in advances is
5 billion but provision against non performing loans has lofted it thus it shows a
less amount of advances this year. Advances in 2007 are the highest because of
the loaning to the commercial, consumers and SME sector.
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Earning Assets to Assets ratio:
This ratio shows the relation between earnings assets and total assets. Earning
assets are those which directly contribute in earnings of a business.
The formula is
Earning Assets to Asset Ratio = Earning Assets
Assets
2004 2005 2006 2007 2008
0.3 0.29 0.290.24 0.24
RUPEES IN --- 000 ---
YEAR 2004 2005 2006 2007 2008
Earning Assets 4,967,239 9,285,427 13,464,364 42,449,386 42,938,188
Total Assets 16,557,463 32,018,715 46,428,843 176,872,441 178,909,115
Ratio 0.30 0.29 0.29 0.24 0.24
Interpretation
We can see that there is 3% decrease in the year 2005 with respect to the
previous year which means that the earning assets have decreased as compared
to the total assets in this year. In 2006 the ratio is the same which means that the
earning assets as well as the total assets have increased with the same ratio.
From the year 2006 to 2007 there is 21% decrease in the ratio which means that
the earning assets have not increased with the increase in the total assets. The
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ratio is the same in the 2008 which means that both the earning and total assets
have increased with the same rate.
B) PROFITABILITY RATIOS:
Profitability is the net result of a number of policies and decisions. This section of
the project discusses the different measures of corporate profitability and
financial performance. These ratios, much like the operational performance
ratios, give users a good understanding of how well the company utilized its
resources in generating profit and shareholder value. The long-term profitability
of a company is vital for both the survivability of the company as well as the
benefit received by shareholders. It is these ratios that can give insight into the all
important "profit". Profitability ratios show the combined effects of liquidity, asset
management and debt on operating results. These ratios examine the profit
made by the firm and compare these figures with the size of the firm, the assets
employed by the firm or its level of sales.
Profit After Taxes
Profit after taxes are given in the income statement of the bank here we have the values on the graph which shows the profit after taxes of the NIB Bank.
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2004 2005 2006 2007 2008
122609 103771 125937
-489769
-7474679
PAT
Internship Report
RUPEES IN --- 000 ---Year 2004 2005 2006 2007 2008PAT 122,609 103,771 125,937 -489,769 -7,474,679
Interpretation
As we can see from the above calculations that the profits are increasing as we
go from 2004 to 2008 which is a very good sign which shows a high amount of
market share of the NIB Bank and pertains its strong position. However the
fluctuation of the year 2008 is because of the acquisition of the PICIC
commercial bank.
Return on Assets:
Return on Assets (ROA) = Profit after Taxation / Average Total assets x 100
ROA is a measure of a company's profitability, equal to a fiscal year's earnings
divided by its total assets, expressed as a percentage. This is an important ratio
for companies deciding whether or not to initiate a new project. The basis of this
ratio is that if a company is going to start a project they expect to earn a return on
it, ROA is the return they would receive. Simply put, if ROA is above the rate that
the company borrows at then the project should be accepted, if not then it is
rejected.
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2004 2005 2006 2007 2008
0.74051 0.323490000000001 0.27125
-0.27124
-4.1779199999
9998ROA ratio
Internship Report
RUPEES IN --- 000 ---Year 2004 2005 2006 2007 2008PAT 122,609 103,771 125,937 -489,769 -7,474,679
Total assets 16,557,463 32,018,715 46,428,843 176,872,441 178,909,115ROA ratio 0.74051% 0.32349% 0.27125% -0.27124% -4.17792%
Interpretation
The above calculations identifies that the NIB Bank is getting 0.74%, 0.32%,
0.27%, 0.27%, 4.17% returns on its assets in 2004, 2005, 2006, 2007 and 2008
respectively. The ratio shows its highest fluctuation in 2008 because of merging
of PICIC commercial Bank into NIB Bank. However from 2004 to 2007 the ratio is
going on decreasing which means that the assets were not utilized efficiently.
Return on Equity (ROE):
Return on Total Equity = Profit after taxation x 100
Total Equity
Return on Equity measures the amount of Net Income earned by utilizing each
dollar of Total common equity. It is the most important of the “Bottom line” ratio.
By this, we can find out how much the shareholders are going to get for their
shares. This ratio indicates how profitable a company is by comparing its net
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2004 2005 2006 2007 2008
0.74051 0.323490000000001 0.27125
-0.27124
-4.1779199999
9998ROA ratio
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income to its average shareholders' equity. The return on equity ratio (ROE)
measures how much the shareholders earned for their investment in the
company. The higher the ratio percentage, the more efficient management is in
utilizing its equity base and the better return is to investors.
2004 2005 2006 2007 2008-202468
10 8.98993000000001
2.46319000000001
2.90722
-1.34356999999999
-0.1883
ROE ratio
RUPEES IN --- 000 ---
Year 2004 2005 2006 2007 2008
Net income 122,609 103,771 125,937 -489,769 -7,474,679
Total equity 1,363,848 4,212,875 4,331,875 36,452,822 39,698,508
ROE ratio 8.98993% 2.46319% 2.90722% -1.34357% -0.1883%
Interpretation
Return On Equity ratio is declining from 2004 to 2008 because the bank was
expanding and progressing and was purchasing more and more assets and
establishing more and more branches over the country so the customers were
also increasing. As we can see that the ratio has a great fluctuation in 2008 that
is because of merging of PICIC with NIB so that the equity of PICIC commercial
bank came under the NIB so that’s why in this year the ratio is the lowest as
compared to the other years.
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Return on Operating Assets:
Return on Operating Assets = Profit after Taxation x 100
Operating assets
Whereas;
RUPEES IN --- 000 ---YEAR 2004 2005 2006 2007 2008
Profit after Taxation 122,609 103,771 125,937 -489,769 -7,474,679
Operating Assets 1,413,266 4,419,810 4,913,117 15,645,901 13,851,373
Return on Operating Assets
8.67% 2.35% 2.56% -3.13% -53.96%
Operating assets = Operating fixed assets + Cash and balances with treasury banks + Balances with other banks
2004 2005 2006 2007 2008
8.67%2.35% 2.56%
-3.13%
-53.96%
ROOA
Interpretation
As we can see from the above table and chart that the ratio decreases from 2004
to 2005 but then the trend goes on increasing and we can see that there is huge
decrease in the ratio in 2008 as the loss of the PICIC commercial bank and NIB
bank were cumulated and similarly the operating assets of PICIC commercial
bank also came under NIB bank thus this justifies the fact of fluctuation and
sudden jump in the values from 2007 to 2008. Economic downturn in this tenure
also affected the profitability to some extent.
Return On Deposits
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This ratio shows how much return is earned in relation to the total deposits. The formula is:
Return on Deposit Ratio = Profit After Taxation x 100 Total Deposits
2004 2005 2006 2007 2008
0.65% 0.63% 0.44%-0.58%
-10.13%
Return On Deposits
RUPEES IN --- 000 ---
YEAR 2004 2005 2006 2007 2008Profit after Taxation
122,609 103,771 125,937 -489,769 -7,474,679
Deposits 10,648,570 22,554,274 30,566,540 116,671,219 104,586,167Ratio 0.65% 0.63% 0.44% -0.58% -10.13%
Interpretation
As we can see from the above calculations that the trend of the ratio is
decreasing from the year 2004 to 2008. The return on deposits in 2004 is 65
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percent while it’s 63 percent in 2005 and 0.44 percent in 2006 while it has gone
down to -0.58 percent in 2007 which shows total loss in this year while there in
2008 we can see that NIB bank suffered huge losses and the ratio is -10.13
percent.
C) MARKET RATIO:
Market Value Ratios relate an observable market value, the stock price, to book
values obtained from the firm's financial statements.
Earning Per Share- EPS:
Earning Per Share = Profit after Taxation
Number of Shares
The portion of a company's profit allocated to each outstanding share of common
stock. Earnings per share serve as an indicator of a company's profitability.
Earnings per share are generally considered to be the single most important
variable in determining a share's price. It is also a major component used to
calculate the price-to-earnings valuation ratio.
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2004 2005 2006 2007 2008
0.99
0.45 0.37
-0.44
-3.63
E/Share
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Interpretation
As we can see from the above graph that the earning per share is declining over
the years but there is huge loss in shares in 2007 and 2008. This shows the lack
of confidence of the customers in the bank. The other core factor is the
devaluation of the Pakistani currency as well as the devaluation of the
government securities and the economic downturn in the world.
D) INCOME OVER EXPENSE RATIO
This ratio shows the relation between income and expense of a company
and tells us that how many times a company or a bank can cover its expenses.
Ratio equal to 1 tells us that the company is just covering its expensing over and
above 1 is countered as the company’s profit. Higher the value above the 1 more
the financially sound is the company or the bank.
The formula is as under:
Income to expense ratio = total income/total expense
Page 892004 2005 2006 2007 2008
1.07 1.04 1.01
0.510.34
income/expense ratio
Year 2004 2005 2006 2007 2008
E/Share 0.99 0.45 0.37 -0.44 -2.63
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Interpretation
In 2004 the income with respect to expense is maximum but it’s decreasing year
by year which means that the bank’s expenses are increasing but the income is
proportionally increasing with a lower rate. In 2008 ratio is the lowest which
means that the income is insufficient to meet the expenses so which means that
the bank observed high losses this year.
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RUPEES IN --- 000 ---YEAR 2004 2005 2006 2007 2008
Total Income 429,174 742,831 1,245,595 1,107,903 2,833,649Total Expenses 397,841 713,054 1,223,682 2,146,173 8,164,241Ratio (in times) 1.07 1.04 1.01 0.51 0.34
Internship Report
6.SWOT AnalysisStrengths
Being the emerging bank in Pakistan it is highly recognized all over Pakistan and
it is very well known among its customers.
NIB Bank has a huge amount of Branches all over Pakistan where other banks
still can not be able to provide their services and that is a huge bonus point for
the bank
The bank has huge amount of assets.
The bank is involved in different investing activities where there is a huge amount
of output available for the bank that bank can use for its growth.
NIB Bank has a very senior and dedicated work force as well as young and
creative staff which is a very big asset for the bank.
NIB Bank has an edge over other local banks, as it was the first privatized bank.
The State Bank of Pakistan has restricted the number of branches that can be
opened by foreign banks, an advantage that NIB Bank capitalizes because of its
extensive branch network.
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Eight years after starting, NIB Bank is now in a consolidation stage designed to
lock in the gains made in recent years and prepare the groundwork for future
growth.
NIB Bank looks with confidence at year 2003 and beyond, making strides
towards fulfillment of its mission, "to become the preferred provider of quality
financial services in the country with profitability and responsibility and to be the
best place to work".
Weaknesses
With the strengths the Bank has also some weaknesses which are as under
Though NIB Bank installed computer yet the system has not totally shifted on
computer. Manual procedure is still there hence computer facility is not fully
availed. It should be fully availed and system should be fully computerized.
A lot of productive time is wasted by the staff in unproductive pursuits and tea
and lunch breaks are got voluntarily extended and the time spent in corridors,
courtyards, depends on the staff will. This tendency of late must be eliminated
which reflect adversely on the image of the institution and has posed a serious
problem.
It should not be like that a person who may be a very good worker but
possessing lack of managerial capabilities should be posted as manager. But as
second place in command or some heavy working department wished persons
together with managerial qualities and manners in the same fashion should be
posted and placed as manager.
People have to wait for re-cashing their cheques for about 10 to 12 minutes,
which is not good for the reputation of bank.
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It is human nature one goes behind reward and incentives while and try to avoid
from punishment. Likewise in commercial institution like bank this system be
introduced with full force means active smart, educated skilled, self spoken and
well versed staff personal, should be reward and appreciates, while on the other
hand lazy, lethargic, heard, rough dealers and ill mannered must be warned
penalized and punishes
Opportunities
The bank has a lot of opportunities which includes
Since the Bank has an extensive networks of branches so if the bank can be able
to computerize all of its branches then it can be able to capture the market more
efficiently
The bank has already a huge amount of customers by providing better and better
services to their existing customers, but word of mouth can also be helpful in
increasing the number of customers to have a competitive advantage over its
growing number of competitors.
Since the Bank is earning a lot of profit per annum so by increasing the
employee’s salaries and providing incentives the Bank can produce more loyal
employees that can increase the productivity.
Threats
With opportunities the Bank has also some threats which includes
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Due to increasing number of foreign banks in Pakistan which offer a very
attractive package for their employees the very key employees of the bank are
more likely to resign which is a very major threat.
Not all branches are computerized neither providing ATM services and no online
banking and the customers demand for these services is increasing day by day
so Bank should computerize all its branches.
At some places, the NIB Bank Limited is over-employed. which is causing over
expenditure
7.CoclusionThe NIB bank in the year 2004, 2005 and 2006 is showing positive ratios while
the bank profitability decreased and even it suffered huge losses due to the
acquisition of PICIC and PCBL during the years 2007 and 2008. This is because
of huge provisions against the obligations of PICIC and PCBL. These provisions
were made by the proper notice from the State Bank of Pakistan as this was
mandatory for the NIB bank.
The NIB bank although made a profit of 2 billion during the years 2007 and 2008
but it was veiled by the huge provision. NIB bank made for about 9 billion of
provisions in 2008. Expenses were also increased during these two years and
the earnings were not enough to cover these expenses. Similarly the total assets
also increased as NIB bank acquired the prescribed banks so there was a huge
problem of managing these assets.
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Second reason but an indirect reason for the losses in 2007 and 2008 is the
recession, which affected almost all the world’s economic systems. Thus all the
banks in Pakistan as well as NIB bank were affected by this economic crisis.
NIB bank’s managers should properly manage assets by understanding
the basic principals of management and by implementing them properly. They
should use the resources optimally. They should also rythemate such a
marketing campaign that promotes the bank and create value of the bank in the
minds of its customers.
During my internship training I gathered information regarding how a
successful bank operational aspects decorticated with the practical.
I found my internship training a very rewarding experience. The
training was beneficial because it helpful me to aware a real l i fe
working environment.
So far my learning is concerned; all the employees at branch were
quite cooperative. They helped me to understand the activit ies of a
bank to possible extent. Their good att i tude gave me more
confidence to learn more and to ask if I have any query in my mind.
Besides their ever going activit ies they never get irr i tant by my
questioning. I had made an honest efferent to present the working &
operation of Bank in simplest way.
I feel pleasure that I have really gained a lot during 6 weeks &
enjoyed working with experienced cooperative & intell igent staff.
Is a good Organization in the way that anybody can join it for his/
her long-term career. Overall working environment is comfortable.
Management of branch cares a lot of i ts employees and considers
them as the Asset of bank. Behavior of senior executive of bank is
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very polite and they are caring about the individual’s career and
their growth.
However management is very demanding about the targets but good
reward at the achievement of assigned targets is awarded.
NlB Bank managers should properly manage assets by understanding the
basic principals of management and by implementing them properly. They should
use the resources optimally. They should also erythematic such a marketing
campaign that promotes the bank and create value of the bank in the minds of its
customers.
8.RecommendationsShortage of Staff:
Almost in all branches of NIB Bank the problem of Shortage Of Staff is
very common. There are only few employees who are the be all and end all of
the whole branch resulting in burden of work. Basically the main idea behind it is
that whenever there is shortage of staff in any organization it always result in lot
of work and also boots up the destructiveness as well because people working
over there feel like that they can do whatever they feel like so are least bothered
about the rules and regulations as implemented by the head office and mostly it
results in corruption.
Staff Is Not Adequately Trained:
Staff in almost all branches of NIB Bank is not adequately trained with the
contemporary era. Basically NIB Bank is from the very beginning, is pioneer of
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new products including ATMs, Mobile Banking and Online banking as well but as
they developed the new systems and products in order to satisfy the customers
want they didn’t get their staff trained in relation with those innovations.
Online Banking
This problem is related to the previous problem as well because when the
staff is not adequately trained then how can they satisfy their customer’s needs,
which is the basic theme or mission of NIB Bank. When NIB Bank started their
online banking, there were only one or two banks (foreign Banks) doing this
practice because of having a larger network as compared to all other domestic
banks started doing this practice but NIB Bank not successful in it because of the
above two problems.
Others
A lot of productive time is wasted by the staff in unproductive pursuits and tea
and launch breaks are got voluntarily extended and the time spent in corridors,
depends on the staff will. This tendency of late must be eliminated which reflect
adversely on the image of the institution and has posed a serious problem.
No periodic increase on salaries of employees.
Overall Suggestions For Improvement
From the quantum of the profit and its financial data it can easily judged
that after privatization is performing well. Its NIB Bank deposits are growing day-
by-day and so is profitability. The controlling body is responsible for the
productive performance of the bank.
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Following are my observation and suggestion to improve the efficiency for
the development of the economy.
Introduce Various Profitable Investment Schemes
A big portion of the home remittance is sent by Pakistan working capital
through NIB Bank. As we know a big portion of this amount is wasted
purchasing of luxuries. The people motivated to save money by offering the
deposit through various investment schemes. The rate of profit should increase
1% or 2% than the other banks and it would be profitable step for bank.
Training Staff
Staff turnover particularly of trained staff result in financial and other
losses. The amount spent by the bank on employment, induction and training of
an outgoing officer constitutes to beat till another officer should ready prove his
work. The exodus of bank officer in the past has worsened the situation.
Change The Nature Of Work
Most of the bank employees are sticking to one seat only with the result
that they become master of one particular job and loose their grip on other
banking operation. In my opinion all the employees should have regular job
experience all out-look towards banking. The promotion policy should be
adjusted.
Refresher Courses
Refresher courses for the staff are most important in any international
organization. All the employees should have these courses according to their
requirement. Foreign experts can also be called for this purpose.
Special Training In Abroad
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Every year some of the employees should be sent for training to other
countries and employees from other branches should be brought here. Some
more reading material should be provided the purpose should be to educate the
employees with the advance studies in their field. The employees should be
provided the opportunities to attend and participate in seminars and lectures on
banking.
Incentive To Employees
Bank should give some more incentive to its employees in order to
remove the conflict between lower and higher officers and should try to improve
the working condition of the bank.
Computer System
Though installed computer yet the NIB Bank system has not totally shifted on
computer. Manual procedure is still there hence computer facility is not fully
availed. It should be fully availed and system should be fully computerized.
Others
The period of internship should be divided into the number of department
of the . The internee should be given NIB Bank timetable mentioning the number
of days he has to work at different places in the bank.
A lot of productive time is wasted by the staff in unproductive pursuits and tea
and lunch breaks are got voluntarily extended and the time spent in corridors,
courtyards, depends on the staff will. This tendency of late must be eliminated
which reflect adversely on the image of the institution and has posed a serious
problem.
Reward And Punishment
It is human nature one goes behind reward and incentives while and try to
avoid from punishment. Likewise in commercial institution like bank this system
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be introduced with full force means active smart, educated skilled, self spoken
and well versed staff personal, should be reward and appreciates. It is therefore
suggest certain schemes and checks may be introduced in banks to increase
efficiency through reward and punishment system.
Over Employed
At some places, the NIB Bank is over-employed, which is causing in
expenditure. I think that the best way out for this problem is to open new
branches in remote areas and encourages the employees to work for creating
the habit of saving in the people.
Customer Problems
People have to wait for re-cashing their cheques for about 10 to 12
minutes, which is not good for the reputation of bank. This delay is due to manual
work. Therefore I suggest that computers and other electronic machine should be
installed in the bank so that time could be saved.
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9.Limitations
Lack of availability of data
Time consuming
Lack of time
Lack of trust
Very costly
Unsupportive bank stuff
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10.Bibliography
www.nibpk.com
www.google.com
www.wikipedia.com
www.answer.com
Book of commercial and corporate banking
www.Howstuffworks.com
www.sbp.org.pk
NIB information booklet. 30/06/2009
Schedule of bank charges and services.
www.kse.com.pk
NIB Bank’s annual report. (2008)
Quarterly Report of NIB Bank ( March 31, 2009)
www.Wikipedia.com
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11.Annexes
12.Glossary
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Banking
TermsBanking Definitions
Banking Terms
Glossary:
Notes and
References
AAA
AAA is a term or a grade that is used to rate
a particular bond. It is the highest rated bond
that gives maximum returns at the time of
maturity. Usually the grade AAA is given to
the best debt obligation or a security, by a
credit rating agency.
Zero Cost
Collar
A type of arrangement, wherein, the borrower
buys a cap from the bank and sells the floor.
In this arrangement, the cost of the cap is
recovered by sale proceeds of the floor or
vice versa.
ABO
ABO is an abbreviation for the term
'Accumulated Benefit Obligation'. It is
basically the measure of the liability of the
pension plan of an organization and is
calculated when the pension plan is to be
terminated.
Debt
Management
Debt management is a process of
managing debts and repaying
creditors. Debt management is a very
broad concept covering almost
anything related to debts and their
repayment.
To know more on debt
management read, Debt
management, Debt
Assistance and Debt
Advise.
Debt
Consolidation
A debt consolidation loan is a type of
loan, where the bank or the lending
More on: Debt
Consolidation
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Loan
institution provides the borrower with a
loan that helps the borrower to pay off
all his previous debts.
Debt
Settlement
Debt settlement is a procedure
wherein a person in debt negotiates
the price with the lender of a loan, in
order to reduce the installments and
the rate of repayment, and ensure a
fast and guaranteed repayment.
To know more on Debt
settlement refer to Debt
Settlement
Debt
Recovery
Debt recovery is the process that is
initiated by the banks and lending
institutions, by various procedures like
debt settlement or selling of
Z score
Z score is a measure, used in the
banking field, to determine the
difference between a single data point
and a normal data point.
Thank You.
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