National Bank Of Pakistan Internship report

					Internship report 2010




                                                                CIIT Lahore




                              National Bank of Pakistan

                   Main Branch, station road Nowshera Cantt, (0382)

                              Khyber Pakhtoon Khwan




Submited to :                        Tahir Aziz Khan

                                     (Internship Incharge)




Submitted by :                       Hina Khan

Registration # :                     BBA-f7- 027

Submition date :



                   COMSATS Institute of Information & Technology
                      Defence road off Raiwind Road, Lahore




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Table of Contents
EXECUTIVE SUMMARY----------------------------------------------------------------------------------------------3
EVOLUTTION OF BANK---------------------------------------------------------------------------------------------4
VISION AND MISSION-----------------------------------------------------------------------------------------------5

CHAPTER 1:___________________________________________________________________________________________________
ORGANIZATION PROFILE

        INTRODUCTION--------------------------------------------------------------------------------------------6
        History of NBP----------------------------------------------------------------------------------------------7
        Branch Network--------------------------------------------------------------------------------------------9
        Product Line-----------------------------------------------------------------------------------------------10
        Services-----------------------------------------------------------------------------------------------------15
        Groups and Divisions -----------------------------------------------------------------------------------16
        Committees ------------------------------------------------------------------------------------------------22
        Board of Directors ---------------------------------------------------------------------------------------27
        Senior management -------------------------------------------------------------------------------------28
        Organizational structure ------------------------------------------------------------------------------30
        Hierarchy---------------------------------------------------------------------------------------------------31
        Departments of branch---------------------------------------------------------------------------------33
        SWOT Analysis--------------------------------------------------------------------------------------------38
        Marketing Strategies------------------------------------------------------------------------------------41
        Competitive Analysis------------------------------------------------------------------------------------41
        Business Process Analysis-----------------------------------------------------------------------------42

CHAPTER 2:___________________________________________________________________________________________________

        HRM in NBP------------------------------------------------------------------------------------------------44

CHAPTER 3:___________________________________________________________________________________________________

        MY DUTIES -------------------------------------------------------------------------------------------------46
        ACOMPLISHMENT----------------------------------------------------------------------------------------47
        PROBLEMS-------------------------------------------------------------------------------------------------47
        RECOMMENDATIONS------------------------------------------------------------------------------------48
        BIBLIOGRAPHY-------------------------------------------------------------------------------------------49
        BUSINESS JARGONS--------------------------------------------------------------------------------------50




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EXECUTIVE SUMMARY

This internship report is all about National Bank of Pakistan. National bank of Pakistan
is huge organization with multiple divisions. This report includes its introduction, its
branch network, structure and major support departments working in National bank of
Pakistan. Furthermore, the overview of human resource activities are included. I spent 6
weeks in National bank of Pakistan, main branch Nowshera Cantt. I spent 2 weeks in
account opening desk first and 1 week in remittance desk, 1 week in government
section, 1 foreign exchange and 1 week in advances National bank of Pakistan keep
their records online through online banking.

In the end I would like to mention that in my tenure of Six weeks I learned a lot and
gained knowledge about the real world practices of banking. In this short time span I
could not learn much but I tried my best to learn enough. My supervisors were very
helping to me. They teach and supported me at every stage and made me understand
the real world practices of banking and its importance.




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EVOLUTION OF BANKS

There are different opinions that how the word „Bank‟ originated. Some of the author‟s
opinion that this word is derived from the word „Bancus‟ or Banque‟, which means a
bench. The explanation of this origin is attributed to the fact that the Jews in Lombard
transacted the business of money exchange on benches in the market place; and when
the business failed, the people destroyed the „bench‟. Incidentally the word „Bankrupt‟s
said to have evolved from this practice.

Some of the authors are of opinion that the word „Bank‟ is derived from the German
word back, which means „joint stock fund‟. Later on when the German occupied major
part of the Italy the word „Back‟ was italicized into „Back‟.

Definitions of Bank

"A financial institution, which deals with money and credit. It accepts

Deposits from individuals, firms and companies at a lower rate of

Interest and gives at higher rate of interest to those who need them.”

A financial establishment which uses money deposited by customers for investment,
pays it out when required, makes loan at interest, exchanges currency, etc.

J.W Gilbert in his principles and practice banking defines a banker in these words:

“A banker is dealer in capital or more properly, a dealer in money. He is intermediate
party between the borrower and the lender. He borrows of one and lends to another”.




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Vision

To be recognized as a leader and a brand synonymous with trust, highest standards of
service quality, international best practices and social responsibility.

Mission

NBP will aspire to the values that make NBP truly the Nation‟s Bank, by:
     • Institutionalizing a merit and performance culture
     • Creating a distinctive brand identity by providing the highest standards of
     services
     • Adopting the best international management practices
     • Maximizing stakeholders value
     • Discharging our responsibility as a good corporate citizen of Pakistan and in
     countries where we operate

Core values

     • Highest standards of Integrity
     • Institutionalizing team work and performance culture
     • Excellence in service
     • Advancement of skills for tomorrow‟s challenges
     • Awareness of social and community responsibility
     • Value creation for all stakeholders

Goals

To enhance profitability and maximization of NBP share through increasing leverage of
existing customer base and diversified range of products.




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INTRODUCTION

The National Bank of Pakistan has its headquarters in Karachi, Pakistan. The bank
operates above 1200 branches in Pakistan and 18 overseas branches, 1 Subsidiary at
Almaty (Kazakhstan) and 11 Representative Offices all over the world.

.NBP is the employer of choice. The whole NBP family comprises of committed and
dedicated members with passion to serve in their respective functional areas. The Bank
has challenging work environment where merit and performance help the individuals to
explore their true potential. As a caring employer the Bank enables the employees to
excel and grow in highly congenial employment conditions and culture. The career path
is full of challenges and opportunities. The Bank has absolutely open culture where
members share and communicate freely.

National Bank of Pakistan is the largest commercial bank operating in Pakistan. It has
redefined its role and has moved from a public sector organisation into a modern
commercial bank. The Bank's services are available to individuals, corporate entities
and government. While it continues to act as trustee of public funds and as the agent to
the State Bank of Pakistan (in places where SBP does not have a presence) it has
diversified its business portfolio and is today a major lead player in the debt equity
market, corporate investment banking, retail and consumer banking, agricultural
financing, treasury services and is showing growing interest in promoting and
developing the country's small and medium enterprises and at the same time fulfilling its
social responsibilities, as a corporate citizen.

It has offloaded 23.2 percent share in the stock market, and while it has not been
completely privatized, partial privatization has taken place. It is now listed on all Stock
Exchanges of Pakistan.

National Bank of Pakistan is today a progressive, efficient, and customer focused
institution. It has developed a wide range of consumer products, to enhance business

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and cater to the different segments of society. Some schemes have been specifically
designed for the low to middle income segments of the population. These include NBP
Karobar, NBP Advance Salary, NBP Saiban, NBP Kisan Dost, NBP Cash n Gold.

It has implemented special credit schemes like small finance for agriculture, business
and industries, administrator to Qarz-e-Hasna loans to students, self employment
scheme for unemployed persons, public transport scheme. The Bank has expanded its
range of products and services to include Shariah Compliant Islamic Banking products.

It has taken various measures to facilitate overseas Pakistanis to send their remittances
in a convenient and efficient manner. In 2002 the Bank signed an agreement with
Western Union for expanding the base for documented remittances. More recently it
has started Electronic Home Remittances Project.

National Bank has earned recognition and numerous awards internationally. It has been
the recipient of The Bank of the Year 2001, 2002, 2004 and 2005 Award by The Banker
Magazine, the Best Foreign Exchange Bank –– Pakistan for 2004, 2005, 2006 and
2007, Global Finance, Best Emerging Market Bank from Pakistan for the year 2005,
Global Finance, Kissan Time Awards – 2005 for NBP's services in the agriculture field.
It is listed amongst the Region's largest banks and also amongst the largest banks in
South Asia 2005, The Asian Banker. It has also been presented a Recognition Award –
– 2004 for having a Gender Sensitive Management by WEBCOP AASHA besides other
awards.

History of National Bank of Pakistan

The history of National Bank of Pakistan is part of Pakistan‟s struggle for economic
independence. National Bank of Pakistan was established on November 9, 1949 under
the National Bank of Pakistan Ordinance, 1949 in order to cope with the crisis
conditions which were developed after trade deadlock with India and devaluation of
Indian Rupee in 1949. . The Bank commenced its operations from November 20, 1949
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at six important jute centers in the then, East Pakistan and directed its resources in
financing of jute crop. The Bank‟s Karachi and Lahore offices were subsequently
opened in December 1949. In 1951, the country was once again faced with a crisis in
the cotton trade when prices was crashed and touched the lowest level since
independence following the cessation of hostilities in Korea.

The precise summary of National Bank of Pakistan regarding its countrywide and
overseas operations is as fallows:

    1949 National Bank of Pakistan (NBP) was established under the National Bank
       of Pakistan Ordinance 1949 and was 100% govt.-owned. NBP acted as an agent
       of the Central Bank wherever the State Bank did not have its own Branch. It also
       undertook Government Treasury operations. Its first branches were in jute
       growing areas in East Pakistan. Offices in Karachi and Lahore followed.
    1950 NBP established a branch in Jeddah, Saudi Arabia.
    The Bank in 1950 had one subsidiary „The Bank of Bahawalpur‟ on December4,
       1947 by the former Bahawalpur State
    1955 By this time NBP had branches in London and Calcutta.
    1957 NBP established a branch in Baghdad, Iraq.
    1962 NBP established a branch in Dar-es-Salaam, Tanganyika.
    1964 The Iraqi government nationalized NBP's Baghdad branch.
    1965 The Indian government seized the Calcutta branch on the outbreak of
       hostilities between India and Pakistan.
    1967 The Tanzanian government nationalized the Dar-Es-Salaam branch.
    1971 NBP acquired Bank of China's two branches, one in Karachi and one at
       Chittagong. At separation of East Pakistan NBP lost its branches there. NBP
       merged with Eastern Mercantile Bank and with Eastern Bank Corporation.
    1974 The government of Pakistan nationalized NBP. As part of the concomitant
       consolidation of the banking sector, NBP acquired Bank of Bahawalpur (est.
       1947).

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    1977 NBP opened an offshore brain Cairo.
    1994 NBP amalgamated Mehran Bank (est. 1991).
    1997 NBP's branch in Ashgabat, Turkmenistan commenced operations.
    2000 NBP opened a representative office in Almaty, Kazakhstan.
    2001 State Bank of Pakistan and Bank of England agree to allow only 2 Pakistani
       banks to operate in the UK. NBP and United Bank agreed to merge their
       operations to form Pakistan International Bank, of which NBP would own 45%
       and United Bank 55%.
    2003 NBP received permission to open a branch in Afghanistan.
    2005 NBP closed its offshore branch in Cairo.

Branch Network

Today the Bank has more than 8.8 million accounts & Bank maintains its presence in all
the major financial centers of the world through over 1200 branches locally, 18 overseas
branches, 1 Subsidiary at Almaty (Kazakhstan) and 11 Representative Offices all over
the world.

The Bank has 12 Regional Computer Centers to cover various on-line and batch system
requirements of branches and controlling offices.

Presently the National Bank of Pakistan is divided into various Groups headed by
SEVPs/EVPs. Its field operations are controlled by 29 regions reporting to as many
Regional chiefs, who control 40 zones and 15 single Branch zones headed by Zonal
Chiefs; 12 corporate branches and 1249 domestic branches headed by Branch
Managers. The bank has 12 SWIFT local centers.

The National Bank of Pakistan has 156 online branches throughout the country. It has
modernized its services by installing Automated Teller Machines (ATMs) called “CASH
LINK” at selected branches.




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The Bank's organizational structure reflects the three levels at which it operates:
international, national and local. The Head Office formulates and implements the
strategic, management and operational policies.

The Bank has representative offices abroad, in London, New York and Tokyo. Beijing,
Tashkent, Chicago and Toronto. Its subsidiaries are Taurus Securities Ltd, NBP
Exchange Company Ltd, NBP Capital Ltd, NBP Modaraba Management Company Ltd,
and CJSC Bank, Almaty, Kazakhstan. The Bank's joint ventures are, United National
Bank (UK), First Investment Bank and NAFA, an Asset Management Company (a joint
venture with NIB Bank & Fullerton Fund Management of Singapore).

The Branch network of National Bank of Pakistan is divided into following categories

      ATM network ( Total ATMs 101 & Total ATMs machines 104)
      Domestic network ( over 1200 Branches)
      Islamic network ( 5 Branches)
      Online network ( 156 Branches)
      Overseas network ( 29 Branches)
      Swift network ( 12 Branches)
      Customer Facilitation Centers (6 Customer Facilitation Centers)
      Agriculture branches ( 825 Branches)


Product Lines
The most precise definition of product is anything capable of satisfying needs, including
tangible items, services and ideas. In marketing, a product is anything that can be
offered to a market that might satisfy a want or need. The National Bank of Pakistan
offering for sale several related products individually, which is commonly known as
product lining. A product line is defined as “A group of products that are closely related
because they function in a similar manner, are sold to the same customer groups, and



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are Marketed through same types of outlets, or fall within the given price ranges”. The
followings are the main consumer banking products of NBP.

   1. DEPOSITS

The National Bank of Pakistan offers to their clients a variety of Deposit Schemes with
personalized services at competitive rates of interest. Any Pakistani citizen can open
his/her account for any deposit scheme at any of its Branches strategically located
throughout Pakistan.

     I.    Current Deposits
These are payable to the customer when ever they are demanded. When a banker
accepts a demand deposit, he incurs the obligation of paying all cheques etc, drawn
against him to the extent of the balance in the account. Bankers in Pakistan do not allow
nay profit on these deposits, and customers are required to maintain a minimum
balance, failing which incidental charges are deducted from such accounts.

     II.   PLS Saving Deposits
In Pakistan a Savings Deposits Account can be opened with a very small amount of
money, and the depositor is issued a cheque book for withdrawals. Profit is paid at a
flexible rate calculated on six monthly bases under the Interest Free Banking System.
There is no restriction on the withdrawals from the deposit accounts but the amount of
money withdraw is deleted from the amount to be taken for calculation of products for
assessment of profit to be paid to the account holder. NBP charge Rs.500 for opening
of PLS Savings deposits.

    III.   Fixed Deposit Account (Time Deposits)
The deposits that can be withdrawn after a specified period of time are referred to as
Fixed or Term Deposits. The period for which these deposits are kept by the bank
ordinarily varies from three months to five years in accordance with the agreement
made between the customer and the banker. Profit/Return is paid to the depositors on
all fixed or Time deposits, and the rate of profit/Return varies with the duration for which

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the amount is kept with the banker. By giving an advance notice to the bank the deposit
can be withdraw from the bank before the expiry of the period. Fixed deposit accounts
have higher rate of interest as compare to other accounts. The rate of interest rises with
the length of period and the amount of deposit. The bank grants to the depositor a fix
deposit (FDR) which is not transferable to any other person.

    IV.   Foreign Currency Account
Government of Pakistan has introduced many important reforms in Foreign Exchange
Control in the country since February, 1990, for the purpose of strengthening the
Foreign Exchange Reserves. One of these reforms relates to foreign currency accounts,
which can be opened in United States Dollars, Pound Sterling, Euro and Japanese Yen
in any of the authorized branches of commercial banks throughout the country.

   2. PREMIER AMDANI
       • Earn up to 11% p.a.
       • Minimum deposit of Rs. 20,000/- and a maximum deposit of Rs. 5,000,000/- for
       5 years
       • Free Demand Draft, Pay Order and Cheque Book*
       • Convenience of NBP online Aasan Banking (for online banking customers)
       • Free NBP Cash Card (ATM+Debit)
       • Running finance facility up to 90%


   3. PREMIER SAVER

       • Earn up to 7.25% p.a. +
       • Minimum saving balance of Rs. 20,001/- & a maximum balance of Rs.
       300,000/-*
       • Free NBP Cash Card (ATM + Debit)
       • Convenience of NBP Online Aasan Banking (for online banking customers)
       • Two debit withdrawals allowed in a month & no limit on number of deposit

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       transactions
       • Profit calculated on monthly and paid on half yearly basis

   4. KABOUR
       • Minimum down payment, 10% of asset price (5% for PCO & Telecaster)
       • Tenure 1 to 5 years (for PCO 2 years)
       • Grace period 3 months
       • Maximum loan amount Rs. 200,000/-
       • Age 18-45 years
       • Mark-up (variable) 1 year KIBOR + 2.00% p.a.
       • The customer will pay markup @ 6% p.a., rest will be borne by GOP*
       • Life & disability insurance paid by GOP*


   5. SAIBAN
       • Home Purchase
       • Home Construction
       • Home Renovation
       • Purchase of Land + Construction
       • Balance Transfer Facility (BTF)
       (Open the Door to Your Dream Home)
       Home Financing


   6. ADVANCE SALARY
       • Easy installments of 1 to 60 months at your choice
       • No minimum income collateral & insurance charges required
       • Quick processing and fastest disbursement
       • The product is for permanent employees of Government, Semi Government
       and Autonomous bodies receiving salaries through NBP accounts



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   7. CASH CARD
       • Use it as an ATM in any of the ATM‟s in Pakistan
       • Use it as Debit Card in any of the outlets with ORIX POS machine
       • Cash withdrawal up to Rs. 20,000/- per day
       • Account Balance Enquiry
       • Mini Statement (Only at NBP ATM)
       • PIN Change facility (Only at NBP ATM)


   8. INVESTOR ADVANTAGE
       • Comfortable environment for trading
       • No security requirement, except for the customer‟s equity
       • Customer‟s equity freely available for investment
       • Equity acceptable in cash or approved shares


   9. CASH AND GOLD

      Facility of Rs. 14, 000/-against each 10 gms of net weight of Gold Ornaments
      No maximum limit of cash
      Repayment after one year
      Roll over facility
      No penalty for each repayment

   10. KISAN DOST
   • Competitive mark-up rate
   • Quick & easy processing
   • Delivery at the farmer‟s doorstep
   • Technical guidance to farmers
   • Wide range of financing schemes for farmers


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   • Finance facility up to Rs. 500,000/- for landless farmers against personal guarantee

   • Financing available against pass book, residential/commercial
   property, gold ornaments and paper security
   • Loan facility on revolving basis for three years (renewable on yearly basis
   without documentation and approval)

    11. PAK REMIT

Pakremit is an internet based Home Remittance Service. This service is available to
U.S. residents for sending money to their family and friends in Pakistan. One must have
a valid US Dollar account with a U.S. bank or a US Dollar credit or debit card in order to
remit funds through this channel

  12. PROTECTION SHIELD
       • No documentation
       • No medical required
       • Premium Auto Debit facility & choice of deactivation
       • Coverage includes death due to:
       • Natural Calamities e.g. Earthquake, Flood, Cyclone etc.
       • Accident
       • Riots*
       • Civil Commotion*
       • Strikes*
       • Acts of Terrorism*


SERVICES

    a) NBP ONLINE
        • Balance Enquiry
        • Statement of Account

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         • Stop Payment
         • Cash deposit to own and third party account
         • Cash withdrawal through Cheque                                                 •
         Transfer of funds to own and third party account


     b) NBP HELPLINE
         • For all NBP Products Enquiry
         • Complaint Resolution
         • Telesales

                                  Call Now - 0800 – 80080


GROUPS

Corporate and Investment Banking
Corporate & Investment Banking Group enjoys robust relationship with premier corporate
clients. The length and breadth of our corporate clientele has been built on corporate
strategy of providing comprehensive and customized financial solutions to our corporate
customers. Varied banking and investment products are offered to the corporate clients
from working capital financing to infrastructure project, structured and syndicated
financing, divestitures, financial restructuring, mergers and acquisitions assignments and
associated financing solutions.

He group facilitated 122 projects and syndicate financing proposals which were mainly in
financing for energy and power sectors. Advisory fee on corporate finance was a major
contributor as the bank executed a number of large transactions in the energy and
infrastructure projects. The bank also focused on increasing trade finance income by
leveraging the bank‟s relationship with clients.

Corporate & Investment Banking Group is geared to take advantage of tremendous growth
potential of corporate accounts and continued its efforts to remain a major contributor to
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the bank‟s earnings. It is striving to market new clients and retain the existing relationships
and build market share through offering superior services, competitive pricing and wide
product range to valued corporate clients.


Commercial & Retail Banking

NBP has the largest retail client base in the country with one of the highest retail portfolios.
The bank‟s retail strategy focuses on its extensive branch network and leveraging the
customer base. In 2009 however due to the high interest rate environment and pressure
due to non performing loans, the consumer advances registered decline.

Despite an ailing economy and adverse macroeconomic factors, the Commercial & Retail
Banking Group (C&RBG) closed 2009 with the key performance indicators being positive.
The absolute domestic deposits base increased by 22% with emphasis on growth in low
cost deposits. As a major initiative in this direction the bank launched CASA Deposit
Mobilization Scheme in late 2009 aimed at mobilizing Current / Saving Accounts through
incentivizing employees. With the increase in NPLs, the focus on recoveries has been
heightened, along with prudent growth in advances.

SME financing is an area of good future potential. Due to negative impact of high inflation
& interest rates, power shortages, fluctuation in commodity prices and reduction in export
orders, this sector suffered considerable pressure that reduced the repayment capacity of
the borrowers for existing loans and also their willingness to go for fresh financing. Due to
these factors SME loans registered decline.

Commodity support prices were raised by the Government to provide much needed
support and encouragement to the growers and as a result the loans under commodity
operations witnessed robust growth during 2009 and increased by 110%. These loans are
fully backed by GOP guarantee.


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Overseas Banking
National Bank of Pakistan is present in all major financial centers of the world; in Europe,
USA, Hong Kong, Japan as well as in the emerging markets of Central Asia, South Asia
and Far East to capture trade related business. Bank‟s overseas network is spread in 16
countries of the world comprising of 22 branches, a wholly owned subsidiary and a Joint
Venture Bank in the United Kingdom besides three Representative Offices.

NBP overseas branches provide all kinds of banking facilities like accepting deposits,
advances to individuals and corporate clients, participation in syndications and trade
financing. The opening of Saudi Arabia branch is underway. In addition efforts are
underway to upgrade Bank‟s existing Representative Offices in Tashkent and Beijing.

Agriculture Finance
The bank aims to cater to the entire farming and non-farming agriculture business and
provides finances ranging from short to long term for the production and development of
crops and non-crop items for agriculture business related to packing, grading, processing,
storage, marketing and exports.

Pakistan‟s rural economy has high growth potential and offers attractive opportunities. The
bank‟s product and services are offered to address the needs of both the farm and non
farm sectors. NBP‟s large rural coverage of the country is second to none and is one of
the major strengths of the bank. Presently, the agriculture financing facility is offered under
the product category of NBP Kisaan Dost where 30 agriculture financing schemes are
offered.

The importance of agriculture financing cannot be over emphasized as agriculture is key to
Pakistan‟s future. Rural banking in Pakistan is in nascent stages and deployment of
technology and modern banking channels continue to be an evolving process.




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Treasury Management
NBP has the largest treasury in terms of size. Its function includes liquidity, exchange and
interest rate management. The Bank is a major player in the foreign exchange and money
market and is a primary dealer of government securities. It has the capability to offer
structured products to its customers, including derivatives. For the banking industry, the
year was very volatile in terms of interest rates, varying liquidity conditions, global credit
tightening, depreciation of Pak Rupee and high inflation resulting in significant movements
in yield curve. Treasury Management Group actively managed its portfolio and optimized
yields.

Islamic Banking

The bank believes that Islamic Banking offers good potential for growth. The bank has
opened eight (8) branches since 2007, of which three were opened in 2009. During the
last two years its asset size has grown significantly with offering of market-driven products
like Murabaha and Ijarah. Islamic Banking is making its mark by catering to the Bank‟s
already existing large customer-base as well as exploring new and untapped markets
including SME, Commercial and Corporate. Islamic Banking is developing policies for new
products like Diminishing Musharikah, Salam and Istisna to meet customer‟s needs. The
overall operations showed loss as a result of higher start up cost of three new branches
opened this year.

Human Resource Management

The bank truly values its staff and the vital role they play in successful organizations. The
bank gives special attention to attracting, developing and retaining good quality human
resource. Our new hiring of top class MBAs as Management Trainees Officers (MTOs)
and search for talent within the Bank have helped in preparing second and third tier
leadership lines. „Female Empowerment‟ was launched to empower female employees
and impact communities by championing the cause of women‟s empowerment in the

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society. Today, NBP is determined in pursuing the policy of placing females on
responsible and challenging position as Branch Managers, Branch Operations Managers
and Customer Facilitation Officers. A number of female MTOs have been selected, trained
and posted as branch managers. Currently, 60 branches are being headed by females.
HR initiatives and strategy is amid at competitive employee compensation, training need
assessment and succession planning. NBP is striving to become an employer of choice
through improved HR policies and competitive remuneration.

Audit & Inspection

Internal Auditing is an independent, objective assurance and consulting activity designed
to add value and improve organizational operations. It helps the bank accomplish its
objectives by bringing a systematic, disciplined approach to evaluate and improve the
effectiveness of risk management, control and governance processes.

In order to restructure the Audit & inspection Group in line with international best practices
a detailed strategic plan has been evolved wherein time-bound action plan was chalked
out to implement four pronged strategy to bring about a quality change in the functioning of
audit and to change its approach from traditional procedure-based audit to a more
sophisticated Risk Based & Value Added Audit & Management Consultancy. To achieve
these goals we are hiring qualified staff, arranging appropriate training programs,
encouraging audit functionaries to acquire professional qualifications, re-engineering
systems, policies and structure of internal audit in line with our objective of undertaking
risk-based and value-added activities.

Credit and Risk Management

NBP is continuously upgrading its risk management process to identify, evaluate and
manage risk. Our focus includes analysis, evaluation and management of all risks which
include credit, liquidity, market, operational and reputation risks. The bank‟s risk

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management policies and procedures are subject to high degree of supervision and
guidance to ensure that all risk categories are systematically identified, measured,
analyzed and proactively managed.

We have deployed value at risk (VaR) framework for measurement and monitoring of
market risk. Operational Risk Management Unit has been established that supplements
Credit and Market risk units for comprehensive risk management. Our risk management in
terms of adoption of Basel II guidelines is advancing smoothly where consultants have
been appointed to assist the bank in developing a robust framework for managing risk.

We have our internal filtration systems and approval hierarchy to ensure that proper
authority and responsibility is established whilst reducing the lead processing time of the
credit application. The bank has proper monitoring system with Credit Administration
Department (CAD) to further improve risk management function.

Compliance
Compliance is an independent function that identifies, assesses, advises, monitors and
reports on the Bank‟s compliance risk, i.e. the risk of legal or regulatory sanctions,
financial loss or loss to the reputation which the bank may suffer as a result of its failure to
comply with applicable laws, regulations, and codes of conduct and standards of best
practices. The bank has accelerated its efforts proactively to strengthen compliance
culture in the bank. During 2009 we have revised Compliance Review Program (CRP) to
incorporate relevant changes in rules, regulations and changing dynamics to help senior
management in identifying and assessing risk. In view of development of Compliance
Review Program, Exception Reporting Mechanism has improved and now senior
management receives report of violations promptly. Immediate corrective measures are
initiated to secure the bank‟s interest.




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COMMITTEES AT NBP

At NBP, the Board of Director‟s have an active role in providing their able guidance and
support to the Bank‟s management. For this purpose a number of Board‟s committees
have been constituted in the bank. These committees have well defined terms of reference
and they meet at regular intervals to review and make decisions on matters of importance
for their respective area of functioning. The following are the committees:


                                          Number
                                                      Chairman of the
           Name of the Committees         of
                                                      Committee
                                          Directors
           Audit Committee                3           Mr. Ibrar A. Mumtaz
           HR Management Committee 4                  Mian Kauser Hameed
           I.T Committee                  3           Mr. Tariq Kirmani
           Board Risk Committee           3           Mr. M Ayub Khan Tarin
           Agriculture Finance
                                          3           Mr. Ibrar A. Mumtaz
           Committee
           Islamic Banking &
                                          3           Mr. Tariq Kirmani
           Subsidiaries Committee
           Sports & Culture Committee 3               Mr. Sikander Hayat Jamali




   a) Audit Committee

This committee has the oversight monitoring / assurance responsibility mainly relating to
the effectiveness of the Bank‟s internal audit function, integrity of the Bank‟s financial
statements, system of internal control, safeguarding of Bank‟s assets and associated risks,


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compliance with the applicable legal and regulatory requirements, corporate governance
and Bank‟s “Code of Conduct” and co-ordination with external auditors, making
recommendations with respect to other matters relating to their independence,
performance, appointment and remuneration and approval of provision of other than audit
services. The major achievement of the committee includes conducting a Quality
Assurance Review of the bank‟s internal audit function through independent consultants to
align the internal audit function with international standards/best practices of corporate
governance. The Committee ensured independence of the Internal Audit function and
further strengthened it in line with the requirements of International Standards on Internal
Auditing, Institute of Internal Auditors USA, regulators and best practices of corporate
governance.

28 meetings were conducted during 2009 and discussed the matters towards fiduciary,
advisory and assurance responsibilities entrusted by the Board of Directors. The
Committee reviewed various matters during the year for improvement in the internal audit,
financial reporting, corporate governance, internal controls, risk management, compliance
with relevant laws and regulations, code of conduct and external audit etc.

   b) HR Management Committee

The committee is an advisory and assurance committee which assists the board in fulfilling
its responsibilities relating to all HR policy matters. It reviews and formulates human
resource policies and best practices for attraction, retention, succession, motivation,
training and development policies to achieve corporate objectives. It also recommends to
the board the compensation, annual increase, performance bonuses, and perquisites of
the CEO, Chief Internal Auditor, Secretary to the Board, CFO and all positions reporting to
the CEO. It suggests strategies for negotiations with training and educational institutions
both nationally & internationally for collaborating in training activities. It is also responsible
for improvements in training methodology and identifying areas relevant to the needs of


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the organization. During 2009 several decisions were taken for improvement in the areas
of HR policies, planning, training & development, compensation &. pension, institutional
discipline, and other HR related areas.

The Committee also discussed and directed to establish state of the art training institute to
impart cutting edge knowledge, modern managerial and leadership skills to the employees
of the Bank and enable them to face the challenges of ever changing environment. The
committee emphasized the automation of all HR functions.

   c) I.T Committee
The Committee is responsible for identifying areas of the prospective automation, reviews
and decides strategic technology implementation and provides guidance and approves
selection of appropriate technology solution; software, hardware, infrastructure and
outsourcing.


For the first time in the history of National Bank a comprehensive IT strategy for the Bank
was designed which encompasses the phase-1 focusing on “Strategy for Systems Quality
Assurance & Testing Strategy (Policy, Procedures, Methodology and Framework).” The
phase-2 of the strategy will cover the entire bank wide transformation and full spectrum
automation, systems and data center integration, depth and width of IT Service Portfolio,
IT Operations, plus incorporating the IT Internal Control Framework supported by COBIT,
ISO ISMS 27001 and ITIL.

The ITBC has reshaped the IT Group‟s Organogram (Organizational Chart) to modernize
and harmonize the entire IT Group with global and local best practices with a futuristic
view to take IT into the new millennium. The new organizational chart also supports
Enterprise Core Banking Application (CBA) Projects and the existing Banking Systems
/Applications /Platforms. ITBC kept a proactive oversight of all 20 Core Banking related
projects through monthly meetings. Provided policy level guidance on bank wide


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transformation of all 1265 branches and Head Office from physical layouts to workflows,
and data quality. ITBC assigned the Chief Information Security Officer to undertake the
revamping of the Information Security Policy to achieve harmonization with ISO
Information Security Management Systems 27001 standard, State Bank of Pakistan‟s
guidelines and the COBIT Framework. ITBC approved the updated policy “ Information
Security Policy” (IT Security Policy v1.1) during the year 2009. The ITBC approved the
Governance, Risk and Compliance (GRC) Stream / Project.

   d) Board’s Risk Committee (BRC)

BRC over sighted the risk related issues of the bank and took several decisions for
implementation. The functional scope of the Risk Management Committee is to develop
the risk management role by identifying the relevant/new risk management tools as per
Basel guidelines and developing the road map for implementing Basel II framework as per
SBP guidelines. It also works for Risk & Exposure Reporting by development of Basel II‟s
economic capital management frame work. This committee also provides the reporting
and research for Board of Directors. It also reviews the liquidity position, forecasting and
projections and portfolio of the Bank. In 2009 the committee approved rating model for
corporate & commercial borrowers.

Beside this the BRC discussed in detail and took decisions on various issues; role &
responsibilities of Risk & Audit, Risk reports, Risk Management Policy, Development on
SaS Project, Regulatory Requirement, Progress on Basel II implementation, HR
requirement of RMD, IRAF grading, Sectoral Analysis, Industrial Ratings, and Status of
CIF project. Various MIS reports such as Monthly Risk Bulletin, an overview of operational
risk management, operational risk report based on fraud & forgery data & SBP penalties
were the key highlights discussed in the BRC meetings during 2009.




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   e) Agriculture Finance Committee
Agriculture Finance Committee directed restructuring and reorganization of Agriculture
Finance Group and approved TOR, vision & mission statement of the group,
Livestock/Dairy Farm Financing policy and Agricultural Finance Policy Manual. Particular
emphasis was given to disbursement of finance to improve the yield/out put of this sector
while maintaining the healthy recovery ratio.


   f) Islamic Banking & Subsidiaries Committee
This Committee provides strategic guidance and recommends initiatives for expansions,
mergers & acquisitions. The strategic endeavors resulted in expansion in NBP Islamic
banking branch network covering all major cities of the country. To evaluate the
commercial viability, future profitability and growth of Islamic banking, the committee
guided Islamic Banking Group to prepare business plan for the year-2010 and henceforth
strategic plan 2011-2013.

Registering the potential of Assets Management companies in Pakistan, particularly those
backed by banks, the committee directed management to look into the formation of bank‟s
own assets management company. The committee also facilitated an agreement between
NBP Exchange Company (a wholly owned subsidiary) and Western Union for home
remittances.

   g) Sports & Culture Committee

The functional scope of the Committee is to devise strategies to promote sports and
cultural activities in the bank as well as in the country. During 2009 the Committee
reviewed the progress of various activities undertaken by the Sports, Culture & CSR
Division and also approved various incentive and cash award policies for sportspersons
working for NBP. The Committee also finalized the fee structure and membership rules &
regulations of NBP Sports Club.


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The Committee also reviewed the performance of the Bank‟s sports teams and provided
guidance and support to enhance their performance. The Committee also approved NBP
Award for Excellence in Literature and devised modalities for evaluation of books. The
Award ceremony was held in February-2009. NBP Sports Club was inaugurated in 2008
and is now fully functional and offers state of the art facilities to its members including
health club, swimming pool, indoor tennis, badminton, squash, table tennis and snooker.


BOARD OF DIRECTORS

Pursuant to Section 11 of The Banks‟ (Nationalization) Act, 1974, the number of Directors
of the Bank shall not be less than 5 and not more than 7, excluding the President.

              Name                                Designation
              Syed Ali Raza                       Chairman & President
              Mr. Sikandar Hayat
              Jamali                              Director
              Mian Kausar Hameed                  Director
              Mr. Ibrar A. Mumtaz                 Director
              Mr. Tariq
              Kirmani                             Director
              Mr. Muhammad Arshad Chaudhry Director
              Mr. Mohammad Ayub Khan Tarin        Director
              Mr. Ekhlaq                          Secretary Board of
              Ahmed                               Directors




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SENIOR MANAGEMENT
The senior management of National Bank of Pakistan is consists of Group chiefs, who
report directly to the Directors of Bank. The whole functions of National Bank of Pakistan
are performed under these Groups. The National Bank of Pakistan has following groups
and divisions:

    Corporate and investment Banking Group
    Operations Group
    Credit Management Group
    Audit & Inspection Group
    Compliance Group
    HRM & Administration Group
    Commercial & Retail Banking Group
    Treasury Management Group
    Special Assets Management Group
    Employees benefit & Disbursements Group
    Overseas & Coordination Group
    Islamic Banking
    Core Banking Application, PMO
    Financial Control Division
    Information Technology Group

 Name                                       Group/post
 Qamar Hussain                              Chief Operating Officer , Head of Credit &
                                            Risk Management Group
 Dr. Asif A. Brohi                          SEVP & Group Chief, Operations Group
 Shahid Anwar Khan                          SEVP & Group Chief, Overseas Banking
                                            Group / Corporate & Investment Banking
                                            Group
 Ziaullah Khan                              SEVP & Group Chief Agriculture Finance

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                         Group
Dr. Mirza Abrar Baig     SEVP & Group Chief, Human Resources
                         Management & Administration Group
Amer Siddiqui            SEVP & Group Chief, Commercial &
                         Retail Banking Group
Tariq Jamali             SEVP & Group Chief, Compliance Group
Nadeem A. Ilyas          SEVP Group Chief, Assets Recovery
                         Group / Corporate & Investment Banking
                         Group
Muhammad Nusrat Vohra    SEVP & Group Chief, Treasury
                         Management Group
Khalid Bin Shaheen       SEVP & Group Chief, Global Home
                         Remittance Management Group
Imam Bakhsh Baloch       SEVP & Group Chief, Audit & Inspection
                         Group
N. B. Soomro             SEVP , Special Assignments, President's
                         Secretriate
Agha Fidaullah           EVP/Group Chief, Special Assets
                         Management Group
Shafique Ahmed Khan      EVP & Divisional Head, Islamic Banking
                         Division
Ekhlaq Ahmed             EVP & Secretary Board of Directors
Fazal-ur-Rehman          EVP & Head P&IR Division, HRM&A
                         Group
Muhammad Hanif           EVP & Head HR & OD Division, HRM&A
                         Group
Muhammad Iqbal Qasim     EVP & Head SC & CSR Division, HRM&A
                         Group
Tahira Raza              EVP & Head Risk Review Division, Credit


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                                             and Risk Management
 Mohammad Kumail Dehradunwala                EVP & Chief Information Officer /Head Of
                                             Information Technology Division
 Aamir Sattar                                SVP & Divisional Head, Financial Control
                                             Division
 Faisal Mahmood                              VP & Divisional Head (A) , PMO & Project
                                             Director CBA




ORGANIZATIONAL STRUCTURE

The Organization Structure (Annexed I) shows the internal operations and reporting lines
of the National Bank of Pakistan. The bank has clearly defined organizational structure,
which supports clear lines of communications and reporting relationships. There exists a
properly defined financial and administrative power of various committees and key
management personnel, which supports delegations of authority and accountability.

The internal operations of the Bank are organized into 15 main departments and divisions
headed by senior management of the bank and are report directly to the Board of
Directors. The organizational structure of National Bank of Pakistan is centralized because
all the decisions of the bank are taken by the top Management.

Hierarchy




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                                  President


                              Board Directors


                              Provincial Chief


                                Regional Chief


                                 Zonal Chief



                              Voice President



                         Assistant Voice President




   Officer Grade I                   OGD II                   OGD III




                           Celerical and Non clerical staff




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Provincial & Regional Management
There are four executives of National Bank of Pakistan to supervise the Bank‟s maters of
every province, as they are called Provincial Chiefs. These provincial chiefs are
responsible for the entire banking operations in their respective provinces. The provincial
management includes:
    The Provincial Chief Punjab
    The Provincial Chief Sind
    The Provincial Chief Baluchistan
    The Provincial Chief N.W.FP & Kashmir
 These provinces are sub-divided into regions, the regions are controlled and manage by
 Regional heads, which are responsible for the supervision in their circles and deal with
 the problems of their respective Regions. The regional management of National Bank of
 Pakistan is divided into two areas which are:
     Overseas
     Countrywide

 The overseas regions include Middle East, Far East, Europe & USA, and Central Asia.
 The country has been divided into 29 regions by National Bank of Pakistan to facilitate
 its functions.

 These regions are sub divided into Zones, the in charge of a Zone is called Zonal Chief.


 Branch Management
 The National Bank of Pakistan, in order to facilitate its functions on branch level
 appoints Branch Managers & other staff according to branch‟s activities and volume of
 business. The branch managers are responsible for all functions and staff within the
 branch office. The job of branch managers is to take charge of the entire operation of
 his branch, making sure that everything runs smoothly. The other functions involves
 scheduling of employee work hours, overseeing training, hiring and firing, assuring that

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proper procedures are followed, and reporting to upper management any problems or
providing reports and updates as required by bank‟s protocol.

The President of National Bank of Pakistan is ranked Top at the hierarchy. The other six
directors of National Bank of Pakistan are ranked second in the hierarchy. The
Provisional, Regional & Zonal chiefs are ranked 3rd, 4th & 5th respectively. The vice
President & assistant vice Presidents of National Bank of Pakistan are ranked 6 th & 7th
respectively. The Officers Grade I, II & III are ranked 8 th at the hierarchy of National
Bank of Pakistan. The lower level of National Bank of Pakistan is consist of Clerical &
non- clerical staff.


Departments of the Branch
   1. Clearing House Department
   2. Remittance Department
   3. Deposits Department
   4. Advances Department
   5. Account Opening Department
   6. Cash Department
   7. Pension Disbursement Department

   1. Clearing House Department

The Clearing System enables cheques to be paid or cleared centrally and settlement
made for receivables and payables between the banks.

   2. Remittance Department

The Remittance department deals with the transfer of money from one place to another.
Funds transfer facility or remittance of funds is on of the key functions of the banks all
over the world. Remittances through banking channels save time, costs less and


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eliminate the risks involved in physical transportation of money from one place to
another. National Bank of Pakistan transfers money in the following ways.

      Pay Order
      Demand Draft
      Pay Slip

Kinds of Remittances
    Transfer within the branch
    Transfer from one branch to another
    Transfer from one bank to another bank in the same city
    Transfers from one bank to another bank in two cities.

   3. Deposits Department

The primary function of National Bank of Pakistan is to accept and receive surplus
money from the people, which they willingly deposit with the Bank. Like all other Banks,
National Bank of Pakistan also take incitation to attract as much depositor‟s as it can.
The deposit department accepts/collects deposit from accountholders.

The National Bank of Pakistan offer different deposit schemes to its customers, which
includes the following:

          Current Deposits
          PLS Saving Deposits
          Fixed Deposit Account ( Time Deposits)
          Foreign Currency Account
          NBP Premium Aamdani
          Foreign Currency Account
          National Income Daily Account (NIDA)




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   4. Advances Department

The bank is profit seeking institution. It attracts surplus balance from the customer at
low rate of interest and makes advances at a higher rate of interest to the individuals
and business firms. Credit extensions are the most important activity of all the financial
institutions, because it is the main source of earnings. Advances department is one of
the most sensitive and important department of the bank.

The advances Department receive application from intending borrowers. After receiving
application the advance department processes it further. After analyzing and detailed
investigation, they decide whether to approve the loan or not. Some loan approvals are
made by the Manager of the branch within his powers as prescribed by the bank‟s
higher authorities, while some loan applications are submit to higher authorities for their
approval. Some advances are of the following nature

   o Loan against Gold
   o Agriculture advance to farmers
   o Medium term advance for working capital
   o Long term advance for setting industry
   o Short term advance to businessman

The National Bank of Pakistan offer following products (Advances) to its customers

   o NBP Saibaan
   o NBP Advance Salary
   o NBP Cash & Gold
   o Students Loan Scheme
   o NBP Karobar

   5. Account Opening Department

The opening of an account is the establishment of banker-customer relationship. This
department performs the duty of opening accounts for customers. It also issues
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chequebooks to customers. A person who wishes to open an account with the bank has
to fill an account opening form obtained from any branch of National Bank of Pakistan.
The bank officer tactfully obtains information about character, integrity, responsibility,
occupation and the nature of business of the perspective customer. Any individual, who
has attained the age of majority and is of sound mind can open and maintain his/her
account. Two or more individuals may open an account jointly. Similarly, business
organizations such as sole proprietary concerns, partnership firms, and limited liability
companies as well as non-profit organizations like clubs, trusts, societies, associations
and NGO‟s etc, may open their accounts. The documents required for National Bank of
Pakistan‟s Account opening are showed as Annexed VII at the end of this report.

The following requirements are necessary for opening an account.

        Identification of the new customer.
        Verification of customer from NADRA
        Ascertaining the genuineness of the stated occupation business of the
          customer.
        Determining the correct residential and permanent address.
        Completion of all relevant columns of the Account opening form.
        Proper completion of documentation.

Functions of Account Opening Department
        Providing account opening form according to the customer's requirements,
        Guide the customer about the requirements of the account opening and form
          filling,
        Check the forms whether they are correctly completed or not,
        Preparing checklist,
        Stamping on the form,
        Maintaining account opening register,
        Pasting of forms in register after release from general banking in charge,

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        Issuance of cheque books,
        Issuance of accounts maintenance certificate,
        Closure of account
        Verification of signature in case of cheque presented before releasing of
          account opening from SS card is not yet scanned

   6. Cash Department

Normally cash department performs following functions

    Collection of funds
    Acceptance of deposits
    Collection of utility bills
    Payment of checks
    Remittances
    Act according to any standing instructions
    Transfer of funds from one account to another
    Verification of signatures
    Posting
    Handling of Prize bond

   7- Pension Disbursement Department

The National Bank of Pakistan was Pakistan‟s leading institution which performs the
function of pension payments or disbursements to pensioners. The pension
disbursement department is responsible for making pension payments to Government
Pensioners. The person who wants to receive his/her pension from National Bank of
Pakistan can open an account with any branch of National Bank of Pakistan. This
department performs following functions:

    Making Pension Payments
    Opening of Account of Pensioner
    Entry of amount paid to pensioner in Government Pensioners Register
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    Verifications of Signatures of Pensioners
    Making Demand Draft Purchase Register



SWOT ANALYSIS

STRENGTHS

   i. NBP has an extensive domestic branch network of over 1200 ranches located all
       over Pakistan. The Bank also has a presence in 23 international locations
       including the USA, United Kingdom, Europe and the Far East.

   ii. NBP is working as right arm government of Pakistan as it is responsible for all
       claims of government for recovery as well as payment. All depositor of NBP are
       in relief that their money security is guaranteed by government of Pakistan.

   iii. It acts as an agent of the Central Bank.

   iv. The working condition in the NBP branch here is very conductive and favorable
       for better output. The informal environment affects the performance of the
       employees in a positive way.

   v. Performing social responsibilities and claiming “The Nation‟s Bank”

   vi. Disbursing Salaries and Pensions to the Government employees and earning
       high profit on NBP.

   vii. Earning commission from SBP on Government transaction

   viii.Holds largest deposit base in the market share in terms of number of accounts

   ix. Leading bank in agriculture financing amongst commercial banks with the market
       share of %

   x. Helping in earning of foreign exchange, remittances and leading agent of
       Western Union Money Transfer NBP has decided to diversify the fund base by
       investing in capital markets not only in Pakistan but also in the foreign countries.


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        xi. The working condition in the NBP branch here is very conductive and favorable
           for better output. The informal environment affects the performance of the
           employees in a positive way.

        xii. Performing social responsibilities and claiming “The Nation‟s Bank”

        xiii.Disbursing Salaries and Pensions to the Government employees and earning
           high profit on NBP-Advance Salary Loan Scheme·

        xiv.Earning commission from SBP on Government transaction

        xv. Facing never problem of cash/currency being its Chest and Sub-chest

        xvi.Holds largest deposit base in the market share in terms of number of accounts

        xvii.Leading bank in agriculture financing amongst commercial banks with the
           market share of 23.2%

        xviii.Helping in earning of foreign exchange, remittances and leading agent of
           Western Union Money Transfer NBP has decided to diversify the fund base by
           investing in capital markets not only in Pakistan but also in the foreign countries.



        WEAKNESSES

  i.       Lowest Internal Control and Compliance System,

 ii.       Unsatisfactory corporate culture of the Bank

 iii.      Physical environment and atmosphere compare to other banks is not meet the
           standard

 iv.       Ineffectively use of technologies i.e. Information technology

 v.        Shortage of staff- per employee customer is very high side

 vi.       Technical education and training of staff is insufficient The workload in NBP is
           not evenly distributed and the workload tends to be more on some employees.



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vii.       Uncertainly among the employees due to threat of downsizing

viii.      The up gradation of human resource is very slow in NBP



OPPORTUNITIES

        i. Being a Government Bank NBP having wide scope in economic market.

        ii. Trust and reliability creates chances to enhance deposit and profitability.

        iii. Its vast network of domestic and overseas branches can help to expand
           business.

        iv. Bank‟s deposit is increasing rapidly so there is a great opportunity to enhance its
           investment and financing.

        v. Being an agent of State Bank of Pakistan it can play vital role in local economy.

        vi. Earning commission/exchange on Government transactions.

        vii. Amongst highest bank is Asia, NBP further expand its services proudest and
           earn more profit.

        viii.The bank is reshaping its portfolios by investing into higher area of growth
           developing core competing as a result to get maximum return.



THREATS

   i.      SBP penalties due to low internal control and compliance.

  ii.      Its staff switching over to other private banks due to more facilities.

 iii.      High number of complaints regarding staff behavior.




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MARKETTING STRATEGIES
Nationa bank of Pakistan offer different products and services to its customers. There
strategy is to become penetrate, offer new products and services to its customer and
capture the market. There two products Advance Salary and Gold loan are their own
products. National bank of Pakistan is penetrate, because NBP is the first bank in
Pakistan which offering these services in both rural and urban areas.



COMPETITIVE ANALYSIS
Rivalry among competitive firms

The NBP offering very low charges on demand draft and give other additional services
to the customers.

Potential entry of new competitors:

there are banks with quality services and low charges. So there is no threat to NBP from
potential entry and NBP is also a public sector bank because of that no other new bank
not takes over it.

Potential Development of substitute products:

ATM which substitute presenting cheques at counter and encash it. The NBP is lacking
in this field. It must improve in this field to compete the competitors.

Bargaining Power of Suppliers:

The suppliers are customers they supply the money to banks. Now they must offer good
services, quality, and safety. Low charges etc to customers.

In this field NBP is very good. B/C at offers good quality services to customers. They
charge low charges on remittances. So that‟s it is competitions other banks.


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Bargaining Power of Consumers:

Now the number customers in Pakistan for banks are very high. Banks offering variety
of products and services to their customers. NBP have a large number of customs.



BUSINESS PROCESS ANALYSIS
NBP, we find a formal organization. The formal organization comes into being when
people are able to communicate with one another or willing to act and share a purpose.

National Bank of Pakistan has a centralized type of management because all the
decisions are taken by the top management. The National Bank of Pakistan has four
types of management levels which are as fallows:

Top Managers
Top managers are responsible for making organization-wide decisions and establishing
the plans and goals that affect the entire organization. These individuals typically have
titles such as executive vice president, president, managing director, chief operating
officer, chief executive officer or chairman of the board. The NBP have its top
management in their head office at Karachi. They are responsible for making the plans
and establishing goals the run their business smoothly all over Pakistan & around the
globe. Among seven member of group Chief Executive is called the president. The bank
has directors for superintendence and direction of its business. The Government
appoints six directors as members and one president. These members are also
responsible for making the policy of the bank.

Middle Managers
Middle managers include all levels of management between the first line level and the
top level of the organization. These managers manage the work of first line managers
and may have titles such as department head, project leader, plant manager or division


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manager.i NBP divided his management into various regions such as Rawalpindi
region, Gujranwala region etc. In NBP, regional management falls under this category.
They are responsible for the planning, organizing, leading and controlling of the
resources and staff of the whole region.

First Line Managers or Lower Level Management
First level managers are the lowest level of management and manage the work of non-
managerial individuals who are involved with the production or creation of the
organizations products. The branch managers of NBP fall under this category. These
managers are responsible for planning, organizing, leading and controlling the staff and
all affairs of the branch.

Non Managerial Employees
Non managerial employees are not concerned with any decision making. They are
normally specialized in their work. The nature of their job is repetitive & clerical as they
do same work again & again. The non managerial employees of NBP consist of OG-II,
OG III and clerical staff.




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CHAPTER 2:

HUMAN RESOURCE MANAGEMENT IN NBP



HR MISSION

Provide more talented Human Resource in all NBP functional areas in relation to
competition keep motivated all the employees and maintain total industrial harmony.



VALUES

We believe that

       People make the organization
       People collectively yield results
       People have ambitions and aspirations to be distinguished and rewarded
       People form the human capital to be developed and invested in.

Job Opportunities

    Management Trainees
    Professionals


TRAINING DEVELOPMENTS

Staff colleges are located in different cities of Pakistan for development of employees.
These are as follow

• JNMDC

• Staff College Karachi

• Staff College Lahore.

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• Staff College Peshawar


Training Programs

Training programs held after some time.

HR Forum

  o NBP Newsline
  o Management Brief
  o Employee Communication Programme

Employee Communication is considered a vital tool for employee motivation and
promoting their commitment and loyalty with the organization. It also helps the
organization to get the employee feedback on important matters.

Employee Communication Program has been developed to keep our employees
informed about the Bank's products and services, prudential regulations, system and
controls, compliance of standard procedure and regulatory requirements, customer
service requisites as well as technological developments particularly automation in
banking functions.


HR Events

      Conference
      Female Empowerment
       Work shop
       Dialogue Sessions
       Quiz Programs




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Functions

HRM group performs following functions:
    Deals from placing job advertisements to timely recruitment of competent
       personnel by using modern selection techniques.
    Systematically observes & measures employee‟s/candidate‟s performance for
       the purpose of selection and promotions.
    Facilitates in establishing successful productive working relationships through
       effectively orienting new employees to their respective departments/divisions and
       to their positions.
    Encourages employees to seek promotion/transfers to fill internal openings and
       meet employees‟ personal objectives.
    Foster a culture of acknowledgement and appreciation amongst employees for
       introducing innovative business practices, showing extra ordinary efforts for
       achievement of goals and enhancing Bank‟s corporate image uses various
       methods of recognition ranging from simple “Thank you” letters to elaborate
       celebrations and monetary rewards.
    Conducting motivation surveys and developing market based employee
       satisfaction & retention strategies.
    Conduction of evaluation of positions and grades to ascertain employees‟
       position in the grade structure.
    This Group supervises all the staff colleges, at Karachi, Islamabad, Lahore and
       Peshawar.



DUTIES

   1- I have passed my first 2 weeks at account opening desk. There my duties were
       t0 check cheque with entries of day book.
   2- Getting information from customer in case of account opening.
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   3- Issue cheque token.
   4- I have to issue cheque books to the customers.
   5- Maintain subsidiary book.
   6- Maintain accounting opening entrance ledger.



At remittance desk my duties were

       1- Check drafts with their advices and pass them and noted them down in
          register.
       2- Drawing government drafts and vouchers.



At foreign exchange desk my duties were

          1- Dealing with customers and getting information from them.


At government section my duty was to scrolling government cheques and drafts.


Accomplishments
I have learn there about account opening, that how to deal customer, what information
should be gathered, and what information should be given to customers.
I learn there what actions take place in bank. How to interact with customers and
colleagues. These all things will help me in my professional life.


PROBLEMS
  1- Lack of motivation.
  2- The second problem is favoritism. People think that favorite people are more
     promoted.
  3- An other problem ia burdon of work. Some times one person does work of 2 or 3
     seats.

                                                                                Page 47
Internship report 2010

  4- Another problem was lack of computerized system. Employees at national bank
     don‟t know that how to use computers.
  5- Photocopy machine is not available in the bank for photocopy of any document.
  6- National bank dealing with customer is well but in rush hours the customer has to
     wait for long time and sometimes bank‟s employees misbehave with customer.
  7- During my internship I observed that some employees didn‟t done their job
     properly and they didn‟t help each other.
  8- Work is not equally distributed. On one hand some employee have to work all day
     without relaxing while some others have nothing to do at all. Due to which
     customers have to wait for long time and dissatisfaction creates in customers.
  9- Lack of job rotation. Due to this problem employees didn‟t know the work of each
     other. No body had complete knowledge about all jobs of bank.
  10- Environment was very uncomfortable for females.
  11- There was shortage of space for customer to wait in bank.
  12- There was no seating arrangement for customers.
  13- Lack of security. Any body can come in bank‟s premises and inside the counter.
  14- Absence of canteen.
  15- Lack of trained employees.
  16- Less authority with manager.
  17- Lack of control over employees.
  18- Internees are given less importance. They do not have proper procedure for
     training. They do not have any schedule for internees.



SUGGESTIONS

  1- There must be motivation workshop for employees.
  2- Good work should be awarded.
  3- Work should be equally distributed.



                                                                                 Page 48
Internship report 2010


  4- Computers must be available to all employees which makes their work easy and
       save their time.
  5- Computer training must be given to employees.
  6- There must be a photocopy machine in the bank.
  7- Internees should be given more formal training.
  8- There must be proper seating plan for customers.
  9- There must be canteen in bank premisis.
  10- There must be a prayer room for female employees.
  11- The bank should improve the quality of training of its employees and the integrity,
       controls and efficiency of its systems,
  12- The bank should improve its recruitment, retention and development and to
       reform the Bank‟s pension scheme.
  13- The branches should reduce its large expenses in order to increase the value of
       the bank.


BIBLIOGRAPHY
       All the information provided by making this internship report has been gathered
during doing internship in National bank of Pakistan and from the following sources

Mr. Nasir Jamal Paracha, (Branch Manager, Assist voice president).
Mr. Subhan Ali, (Account opening officer,)
Mr. Rafiq , (Remittance officer).
Mr. Anwar Ali, ( Foreign Exchange officer).
Mr. shams uz Zaman, (Advance officer).
www.nbp.com




                                                                                 Page 49
Internship report 2010



BUSINESS JARGONS
DD (Demand Draft)
DDP (Demand Draft Purchase)
F-50 (Debit Voucher)
F-87 (Cheques voucher)
F-86 (Cash Voucher)
F-51 (Credit Voucher)
F-117
MT (Draft)




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