Good relationship among staff member leads to the peak performances in any organization.

I observed that

the staff relationship was normal other wise but some time I noticed that there existed a little conformity

among the staff members. Another syndrome from which the staff suffered was that all of them considered

themselves more important than others. Some of the officers used to say that if I am absent for a day the

bank would stop working. So this sort of attitude is not good because it mars bank image and juniors’

willingness learn and work hard and in the end will hurt the whole team.

Improper Distribution of Work

Proper distribution work leads to success in every organization. Proper distribution of work prevents the

employee from over and under work situation. So for a smooth running of an organization proper

distribution of work is the hint to be followed. During my internship I observed that there was no proper

distribution of work in the bank. I saw that some of the employee worked like ants other sat idle starting

here and there. So this created a lot of over work situation for while relaxation for other.

Favoritism and nepotism

In the during my internship in Main Branch Mansehra I saw that when some of the employees are transfer

to other places, due to their relation with influential people and with top management they can cancel their

transfer in few weeks, when they are unsatisfied at that place. Not in one branch of NBP but as a whole.

This process will also be apply in recruitment and selection process. Deserving candidate will fails to

qualify.

So I suggest that in the organization there should be no favoritism, nepotism and politics and their transfer

and promotion should be made on merit and according to the rules and regulations of the bank and

provided favorable environment to the employee to show their performances.

Skilled and Highly educated staff

29
Internship Report on NBP, Main Branch Islamabad.
National bank of Pakistan requires skilled and highly educated staff. Nowadays, there is a large number of

M.B.As who is unemployed. These young people have the knowledge and skill to compete in this

competitive and dynamic environment of banking. National bank of Pakistan should recruit new young

professional.

Inter Departmental Transfer

I watched during my internship that, there is number of employee who have worked on one seat for many a

year. It can have negative effects motivation of employee who is hard working and intelligent. Take the

example of advances section. In advance section if the employee is transfer after sixth month or seven

month, how can he be able to show his performances and how can he be able to know the bank customer in

a short period of time.

Marketing Policy

The branch should adopt various marketing strategy and promotion strategy to promote the bank and its

product. But being a nation’s bank it did not makes so much marketing policies.

The most important in my opinion is personal marketing; it is the most effective of all when you think in

term of branch level. But on the whole organization level, they should arrange the seminar with in the bank

and outside the bank. They should introduce various prizing schemes just like Habit Bank. Mahana

Scheme, Bank Al-Falah (monthly income earning scheme) and various others. They should do more

advertising through newspaper and media and through channel of personal contacts.

Complaints of Customer
There should be an information desk to provide the information and to receive the complaints of the

customer in the bank. There is no complaint box available in the branch and not any person appointed to

hear the complaints.

30
Internship Report on NBP, Main Branch Islamabad.

Every person cannot go to the manager for the complaint because most of the people are hesitant. So I

suggest management to install a compliant box in the branch, and recruit a special person for that guidance

of the customer when they are unable to manage some difficulties in banking matters.

Analysis of the Business:

Proper analysis of the business reports should be conducted before extending any type of
loan. For this purpose professional training of the stuff member is required.
Organizational Commitment

It is suggested that employees working on daily wages basis should be given some benefits, which the other

employees are getting. Their salaries must increase according to efficiency, performance and service.

Managerial Leadership

In the analysis, we have discussed the difficulties of the assistant in taking any initiative; therefore it is

recommended that the assistants should he given special training to make them ready for the leadership.

Credit Monitoring
The credit department of the bank should carries out vigilant credit monitoring. They
should ensure the proper payment of installments and the mark-up by the borrower.
The staff members who have done all the paper work of the loan extension should
perform the monitoring, as he/she will be having more information about the borrower.
Housing and House Hold Goods loans

Bank should initiate these loans because most of bank’s customers are middle class and they cannot afford

to buy house or household goods at once by their own. For this purpose bank should set lowest markup to

its to attract customers.

31
Internship Report on NBP, Main Branch Islamabad.
Avoiding Bad Debts
Special care should be taking while extending the loan. Loans should be awarded against
reasonable securities, where market value should be equal to the loan granted.

Policies should be crafted in a way to ensure that no loan is extended on political pressure. SBP regulation

for loan approval should be strictly followed. According to which the current ration of borrower’s business

must be 1:1 and the debt to equity ratio should be 60:40, means the liquidity position of business should be

healthy.

Car Financing Scheme

Car financing scheme with the name of “ MY CAR FINANCING SCHEME” should be initiated This

finance scheme will help the general public to buy the car of their choice in easy quarterly installments The

bank monitors will do strict monitoring and the car will be hypothecated with the bank against the car loan.

Avoid Political interference

Political interference is the second big problem for National Bank of Pakistan. So, it is very important to

avoid political interference in banking operations. In order to avoid this first suggestion is the

denationalization of the bank

32
Internship Report on NBP, Main Branch Islamabad.

Bibligraphy
 Israr, Siddiqi H. (1998Banking law and Financial Services. Karachi: Decent Print
Enterprises. Page 35, 36, 40.
 Sir Paged John. The law of Banking. The Law of Banking. McGraw Hill Publication:
page 51-58
 Dr.Aftab Ahmad Khan (Macro Economics and Financial Sector of Pakistan.)
 www.nbp.com.pk
 Bank Nationalization act 1974.
 President Office, June 21, 2006, Circular No. 13, 2002. Head Office National Bank of
Pakistan Karachi.
 Standard procedure Manual of National Bank of Pakistan.
 Instruction Circulars of 2008
 Http//www. nbp. com . pk.
 National Bank of Pakistan Yearly Report 2008.
33
Internship Report on NBP, Main Branch Islamabad.

Financial Statements for NATIONAL BANK OF

PAKISTAN (NBP)
Year over year, National Bank of Pakistan has been able to grow revenues from 12.4B to
16.6B. Most impressively, the company has been able to reduce the percentage of sales
devoted to cost of goods sold, SGA expenses and income tax expenses. All of these
improvements led to a bottom line growth from 15.7B to 18.1B.
View Income Statement In U.S. Dollar

Currency in As of: Dec 31 Dec 31 Dec 31 Dec 31 4-Year

Millions of Pakistan Rupees 2006 2007 2008 2009 Trend
Restated Restated Restated PKR
PKR PKR PKR
TOTAL REVENUES 40,265.9 42,792.1 41,957.1 45,980.5
Cost of Goods Sold 237.0 239.2 261.8 330.3
GROSS PROFIT 40,028.9 42,552.9 41,695.3 45,650.3
Selling General & Admin Expenses,
13,408.7 14,149.4 18,101.5 22,486.4
Total
EBT, EXCLUDING UNUSUAL
26,568.7 28,451.8 22,261.3 22,198.8
ITEMS
Other Unusual Items, Total -- -- 988.0 --
Other Unusual Items -- -- 988.0 --
EBT, INCLUDING UNUSUAL ITEMS 26,568.7 28,451.8 23,249.3 22,198.8
Income Tax Expense 9,314.0 9,046.6 7,565.2 4,099.8
Minority Interest in Earnings -11.9 -11.9 -3.0 1.8
Earnings from Continuing Operations 17,242.8 19,393.3 15,681.1 18,100.8
NET INCOME 17,242.8 19,393.3 15,681.1 18,100.8
NET INCOME TO COMMON
17,242.8 19,393.3 15,681.1 18,100.8
INCLUDING EXTRA ITEMS
NET INCOME TO COMMON
17,242.8 19,393.3 15,681.1 18,100.8
EXCLUDING EXTRA ITEMS
Financial Statements for NATIONAL BANK OF
PAKISTAN (NBP)
National Bank of Pakistan uses little or no debt in its capital structure and may have less
financial risk than the industry aggregate.
View Balance Sheet In U.S. Dollar

Currency in As of: Dec 31 Dec 31 Dec 31 Dec 31 4-Year

Millions of Pakistan Rupees 2006 2007 2008 2009 Trend
Restated Restated Restated PKR
PKR PKR PKR
Assets
Cash and Equivalents 83,362.6 76,056.3 140,477.0 138,631.3
Trading Asset Securities 400.7 753.6 1,009.2 2,381.3
TOTAL CASH AND SHORT
98,762.1 96,158.1 156,995.0 160,951.5
TERM INVESTMENTS
Other Receivables 5,022.0 2,134.9 2,105.7 13,566.9
TOTAL RECEIVABLES 5,022.0 2,134.9 2,105.7 13,566.9
Restricted Cash 36,912.6 59,478.5 5,792.1 6,823.6
Other Current Assets 9,606.3 12,904.1 16,276.2 21,070.2
TOTAL CURRENT ASSETS 159,999.9 180,066.3 195,166.9 218,341.3
Gross Property Plant and
13,516.3 29,379.1 28,214.4 29,982.1
Equipment
Accumulated Depreciation -3,854.9 -3,423.4 -3,962.7 -4,810.5
NET PROPERTY PLANT AND
9,661.5 25,955.7 24,251.7 25,171.6
EQUIPMENT
Deferred Tax Assets, Long Term -- -- 3,203.6 3,064.5
Other Intangibles 30.0 23.6 20.3 29.3
Other Long-Term Assets 2,976.8 7,068.3 34,280.7 32,238.3
TOTAL ASSETS 637,948.7 764,608.8 820,077.2 945,903.3

LIABILITIES & EQUITY

Accrued Expenses 9,109.1 10,101.2 15,204.6 18,247.5
Short-Term Borrowings 4,399.5 3,531.9 31,892.0 33,705.1
Current Portion of Long-Term
7,831.9 7,274.0 5,117.9 2,921.1
Debt/Capital Lease
Current Portion of Capital Lease
8.1 15.4 15.2 19.0
Obligations
Other Current Liabilities, Total 10,613.9 7,074.6 10,242.6 10,654.7
TOTAL CURRENT LIABILITIES 533,971.2 619,798.7 687,806.3 792,041.4
Long-Term Debt 459.0 541.3 3,049.6 8,220.9
Capital Leases 6.3 18.3 10.0 23.6
Minority Interest 97.8 109.7 112.7 110.9
Unearned Revenue, Non-Current 72.2 106.8 133.3 218.0
Pension & Other Post-Retirement 2,310.0 2,649.2 3,052.8 3,531.0
Benefits
Deferred Tax Liability Non-Current2,376.6 5,099.1 -- --
Other Non-Current Liabilities 15,686.7 18,481.7 21,573.9 20,425.7
TOTAL LIABILITIES 554,979.8 646,804.9 715,738.7 824,571.6
Common Stock 7,090.7 8,154.3 8,969.8 10,763.7
Retained Earnings 43,199.3 58,731.7 67,612.0 78,212.5
Comprehensive Income and Other 32,678.9 50,917.9 27,756.7 32,355.4
TOTAL COMMON EQUITY 82,968.9 117,803.9 104,338.5 121,331.6
TOTAL EQUITY 82,968.9 117,803.9 104,338.5 121,331.6
TOTAL LIABILITIES AND
637,948.7 764,608.8 820,077.2 945,903.3
EQUITY

Financial Statements for NATIONAL BANK OF

PAKISTAN (NBP)
View Cash Flow In U.S. Dollar

Currency in As of: Dec 31 Dec 31 Dec 31 Dec 31 4-Year

Millions of Pakistan Rupees 2006 2007 2008 2009 Trend
Restated Restated Restated PKR
PKR PKR PKR
NET INCOME 17,242.8 19,393.3 15,681.1 18,100.8
Depreciation & Amortization 496.8 564.5 761.2 875.8
Amortization of Goodwill and
4.1 0.5 -- --
Intangible Assets
DEPRECIATION &
500.8 565.0 761.2 875.8
AMORTIZATION, TOTAL
Amortization of Deferred Charges -- 4.2 4.2 6.0
(Gain) Loss from Sale of Asset -9.0 -3.0 -8.0 -7.9
(Gain) Loss on Sale of Investment -707.1 -40.2 371.7 651.3
-
Other Operating Activities -1,980.8 -3,820.8 -7,458.4
10,266.1
Change in Trading Asset Securities -161.8 -380.4 -225.6 -1,371.4
Provision for Credit Losses 3,081.0 4,763.0 10,634.4 11,148.8
(Income) Loss on Equity Investments -139.6 -241.4 -134.8 36.5
- - - -
Change in Other Working Capital
45,714.6 31,457.0 47,727.1 78,285.9
- - - -
CASH FROM OPERATIONS
27,888.3 11,217.3 30,909.0 56,304.5
Capital Expenditure -732.4 -1,038.5 -1,648.3 -1,776.3
Sale of Property, Plant, and Equipment22.2 13.3 24.9 14.0
Investments in Marketable & Equity - -
6,012.3 13,372.0
Securities 65,504.6 40,773.4
- -
CASH FROM INVESTING 8,205.4 14,635.9
63,251.0 40,638.9
Long Term Debt Repaid -9.9 -14.7 -17.9 -25.9
TOTAL DEBT REPAID -9.9 -14.7 -17.9 -25.9
Common Dividends Paid -1,474.6 -2,831.9 -6,104.9 -5,820.3
TOTAL DIVIDEND PAID -1,474.6 -2,831.9 -6,104.9 -5,820.3
CASH FROM FINANCING 37,335.9 86,953.8 27,409.4 95,317.5
Foreign Exchange Rate Adjustments -150.1 30.9 2,623.1 919.5
NET CHANGE IN CASH 17,502.9 12,516.3 13,759.4 -706.4