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1 1 BANKING The word 'Bank' is said to have been derived from the words Banc us or Banque or Bank. This history of banking is traced to as early as 2000 B.C. The priests in Greece used to keep money and valuables of the people in temples. These priests thus acted as financial agents. The origin of banking is also traced to early goldsmiths. They used to keep strong safes for storing the money and valuables of the people. The persons who had surplus money found it safe and convenient of deposit their valuables with them. The first Stage in the development of modern banking, thus, was the accepting of deposits of cash from those persons who had surplus money with them. The goldsmiths used to issue receipts for the money deposited with them. These receipts began to pass from hand to hand in settlement of transactions because people had confidence in the integrity and solvency of goldsmiths. When it was found that these receipts were fully accepted in payment of debts; then the receipts were drawn in such a way that it entitled any holder to claim the specified amount of money from goldsmiths. A depositor who is to make the payments may now get the money in cash from goldsmiths or pay over the receipt to the creditor. These receipts were the earlier bank notes. The second stage in the development of banking thus was the issue of bank notes. The goldsmiths soon discovered that all the people who had deposited money with them do not come to withdraw their funds in cash. They found that only a few persons presented the receipts for encashment during a given period of time. They also found that most of the money deposited with them was lying idle. At the same time; they found that they were being constantly requested for loan on good security. They thought it profitable to lend at least some of the money deposited with them to the needy persons. This proved quite a profitable business for the_ goldsmiths. They instead of charging safe keeping charges from the depositors began to

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BANKINGThe word 'Bank' is said to have been derived from the words Banc us or Banque

or Bank. This history of banking is traced to as early as 2000 B.C. The priests in Greece used to keep money and valuables of the people in temples. These priests thus acted as financial agents. The origin of banking is also traced to early goldsmiths. They used to keep strong safes for storing the money and valuables of the people. The persons who had surplus money found it safe and convenient of deposit their valuables with them. The first

Stage in the development of modern banking, thus, was the accepting of deposits of cash from those persons who had surplus money with them.

The goldsmiths used to issue receipts for the money deposited with them. These receipts began to pass from hand to hand in settlement of transactions because people had confidence in the integrity and solvency of goldsmiths. When it was found that these receipts were fully accepted in payment of debts; then the receipts were drawn in such a way that it entitled any holder to claim the specified amount of money from goldsmiths. A depositor who is to make the payments may now get the money in cash from goldsmiths or pay over the receipt to the creditor. These receipts were the earlier bank notes. The second stage in the development of banking thus was the issue of bank notes.

The goldsmiths soon discovered that all the people who had deposited money with them do not come to withdraw their funds in cash. They found that only a few persons presented the receipts for encashment during a given period of time. They also found that most of the money deposited with them was lying idle. At the same time; they found that they were being constantly requested for loan on good security. They thought it profitable to lend at least some of the money deposited with them to the needy persons. This proved quite a profitable business for the_ goldsmiths. They instead of charging safe keeping charges from the depositors began to give them interest on the money deposited with them. This was the third stage in the development of banking.

DEFINITIONS:The term 'bank' is being used for a long time, yet it has no precise definition. The

basic reason is that the commercial banks perform not just one but many types of functions. The term bank has been defined differently by different authors. Some are as follows:

GILBERT:

"A banker is a dealer in capital or more properly a dealer in money. He is an intermediate party between the borrower and the lender. He borrows from one party and lends to another."

SAMUELSON: “Commercial banks provide certain services for customers and in return receive payments from them.”

BANKING COMPANIES ORDINANCE 1962:“Banking means the accepting for the purpose of lending or investment, of deposits of money from the public, repayable on

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demand or otherwise and withdraw able by cheque, draft, order or otherwise.”

NATIONAL BANK OF PAKISTAN: HISTORY AND PROSPECTS:HISTORY:

The story of NBP is part of our struggle for economic independence. When we won political independence, Nona Pakistanis, mostly Hindus controlled our economy. East Pakistan was spared from massive migration but its economy was also, being dependent on Calcutta, badly hurt. Most bankers and business experts left Pakistan and the economic life was brought to a standstill, these mostly branches of Imperial Bank of India were only in partial operation with skeleton staff.

National Bank of Pakistan maintains its position as Pakistan's premier bank determined to set higher standards of achievements. It is the major business partner for the Government of Pakistan with special emphasis on fostering Pakistan's economic growth through aggressive and balanced lending policies, technologically oriented products and services offered through its large network of branches locally, internationally and representative offices.

National Bank of Pakistan (the Bank) 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. Initially the Bank was established with the objective to extend credit to the agriculture sector. The normal procedure of establishing a banking company under the Companies Law was set aside and the Bank was established through the promulgation of an Ordinance due to the crisis situation that had developed with regard to financing of jute trade. The Bank commenced its operations from November 20, 1949 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. The nature of responsibilities of the Bank is different and unique from other banks/financial institutions. The Bank acts as the agent to the State Bank of Pakistan for handling Provincial/Federal Government Receipts and Payments on their behalf.

The Bank has also played an important role in financing the country’s growing trade, which has expanded through the years as diversification took place. Today the Bank finances import/export business to the tune of Rs. 52.7 billion, whereas in 1960 financing under this head was only Rs. 1.54 billion.

On 01-01-1974 along with all major financial entities, national bank of Pakistan was also nationalized upon promulgation of the banks (Nationalization) Act, 1974/

SPECIAL ROLE: NBP occupies a unique position in the financial sector of Pakistan. It acts as an agent of the Central Bank wherever the State Bank does not have its own Branch. It also undertakes Government Treasury operations.

OWNERSHIP: NBP is 100% owned by the Government of Pakistan (GoP).

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The bank has also won numerous international accolades and recognitions and has registered a record gross profit of Rs . 26.310 billion for the year ended 31-12-2006.DEPOSITS:

NBP holds 24.6% share of time and demand deposits in the country. Local currency deposits comprise 67% of bank's total deposits while foreign currency deposits account for the rest.

TRANSACTION: Initial public offering and listing of 5% GOP owned shares of NBP on the

domestic stock exchange(s) to the general public.

ASSETS: NBP's total assets stood at PKR350 billion on December 1999. This included total

earning assets of about PKR268 billion with gross loan portfolio of PKR140 billion. The bank also has an investment portfolio of PKR91 billion, which comprises treasury securities, corporate bonds, shares and other securities.

EQUITY: As of December 1999 NBP had a paid-up capital of PKR1.46 billion divided into

146 million shares of 10 rupees each. Total shareholders' equity was PKR10 billion, however, revaluation reserve has increased shareholders' funds to PKR16 billion. NBP has, however, increased its paid up capital from PKR Rs. 1.46 billion to Rs. 3.73 billion through issuance of bonus shares (subject to corporate and shareholder approvals).

Net Profit Margin 44.68% 40.33% 41.05%

Operating Margin 68.57% 62.11% 63.23%

EBITD Margin - - -

Return on Average Assets 2.77% 2.84% 2.96%

Return on Average Equity 20.64% 21.92% 21.50%

Employees 14,019 -

PROSPECTS:The Bank's principal strategic going forward objective is to make the transition

from a public service institution to a modern commercial bank. Being the country's largest financial institution, the Bank is uniquely positioned to leverage its large branch network and its 8.5 million customer base to consolidate its core businesses as well as develop new revenue generating opportunities.

The new management team is in place combining the Bank's existing personnel with professionals recruited from outside. Operating procedures are being re-defined andInternal controls strengthened utilizing a revamped IT architecture. A brief on the progress.

GROWTH AT A GLANCE

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(2006-2010)

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CATEGORIES OF SHARE HOLDERSAS AT DECEMBER 31, 2010

PARTICULARS SHARE HOLDERS

SHARE HOLDING

%AGE

Govt. of Pakistan

1 1443992 .2932%

President of Pakistan

2 383464 .0779%

State Bank of Pakistan

1 370243964 75.1901%

Directors And Children

2 2640 .0005%

Associated companies

3 43551 .0088%

NIT & ICP 5 3185080 .6468%

DFI, NBFI & BANKS

39 17768776 3.6085%

Insurance Companies

15 11449658 2.3252%

Mudaraba 30 23332418 4.7384%

General Public (Local)

7963 27421860 5.5689%

General Public (Foreign)

296 873514 .1774%

Others 194 36261705 7.3641%

Total 8551 492410622 100.00%

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OBJECTS AND ACTIVITIES:The Bank is providing all banking services of mercantile and commercial banking

Permissible in the country, which include: • Handling of treasury transactions for the Government of Pakistan as agent to the State Bank of Pakistan. • Providing services under a Trust Deed as Trustee to the National Investment

Trust (NIT) including safe custody of securities on behalf of NIT. • Accepting of deposits of money on current, fixed, saving, term deposit and

profit and Loss sharing accounts. • Borrowing money and arranging finance from other banks. • Advancing and lending money to its clients.

RECOGNITION & AWARDS TO NBP: Bank of the year awards for the years 2007 & 2002 by the world renowned

magazine the Banker. One of the best bank in emerging markets by global finance. Bank with the highest return on capital in the Asia and No. 08 in the world 2003. Ranked among top 100 banks of Asia –Euro money. Kisan time award 2005- 2006. The strongest bank in Pakistan-Asian Banker.

Best bank – Pakistan 2005-Global Finance. Best emerging market bank from Pakistan for the year 2006 – Global finance. “The Banker” Magazine in its July 2007 Issue announced that NBP has the best

return on capital of any bank in Asia, In July 2007 NBP’s standalone rating were upgraded to AAA/A-one plus from

AA+/A-1+by JCR-VIS credit Rating Agency.

Over Pakistan. The Bank also has a presence in 24 international locations including the USA, United Kingdom, Europe and the Far East. In District Bahawal Nagar there are near about 27 Braches of National bank of Pakistan. In tehsil Bahawal Nagar there are only 02 branches, one is Main Branch Bahawal Nagar and the Second is Bank Street Brach Bahawal Nagar.

Bahawalnagar

S.NoName of Branch Code Mailing Br. Telephone Br. fax

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1Main Br. Bahawalnagar

307 Main Branch Bahawalnagar 0631-74161 74161

AIMS & OBJECTIVES OF NBP:National Bank has some objectives, which it is trying to achieve. Following

are some of them: To maximize profit To provide all sort of banking services. To serve the humanity in all parts of the world through its network of branches

throughout the world. To satisfy customers beyond their expectations by providing personalized

effective & efficient services in best & possible manner. To serve Pakistan better in order to give socio-economic uplift.

To provide the maximum profit to depositors by achieving sound profitable growth.

To develop & enhance its system & technology. To train its staff. Providing information & advice to its customers. Providing facilities of foreign currency accounts.

We aim to be an organization that is founded on…

Growth through creation of sustainable relationships with our customers. Prudence to guide our business conduct. A national presence with a history of contribution to our communities.

We shall work to…

Meet expectations through Market-based solutions and products. Reward entrepreneurial efforts.

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Create value for all stakeholders

We aim to be peopling who…

Care about relationships. Lead through the strength of our commitment and willingness to excel. Practice integrity, honesty and hard work. We believe that these are measures of

true success.

We have confidence that tomorrow we will be…

Leaders in our industry. An organization maintaining the trust of stakeholders. An innovative, creative and dynamic institution responding to the changing needs

of the internal and external environment.

ORGANIZATIONAL CHART

PRESIDENT

SENIOR EXECUTIVE VICE PRESIDENTGRADE 22

EXECUTIVE VICE PRESIDENTGRADE 21

VICE PRESIDENTGRADE 20

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ASSISTANT VICE PRESIDENTGRADE 19

GRADE I OFFICERGRADE 18

GRADE II OFFICERGRADE 17

GRADE III OFFICER(GRADE 16)

ORGANIZATION SETUP:

.PUNJAB

NWFP & AZAD KASHMIR

SINDH

BALOCHISTAN

KARACHI

LAHORE

PESHAWAR

PROVINCIAL HEAD QUARTERS

QUETTA

HEAD QUARTER

CIRCLE OFFICES

BRANCH OFFICES

KARACHI

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The national bank of Pakistan main branch Bahawal Nagar has total 22 staff members and their management hierarchy is as under;Mr.M. Arshad Nagra AVP/ ManagerMr. M. Ali shah Manager OperationsMr. M Amin Credit Officer (Grade II)Mr M. Arshad Mali Officer (Grade II)Mr. Javeed Ashraf Officer (Grade II)Mr. Mohram Khan Officer (Grade II) Account Deptt.Mr. Rao M. Saleem Officer (Grade III)

Mr. Junaid Officer (Grade III)Mr.Mukhtar Officer (Grade III)

Mr. Qamar Shah Head CashierMr. M. Bashir CashierMr. Mushtaq Sales Officer NBP SaibanSchemeMr. Safdar Sales Officer NBP Karobar Scheme

GENERAL BANKING:

Attended OfficerMr. Munir Ahmed(Operational Manager)

Time Spent 20 Days

CLEARING DEPARTMENT:Every banker acts both as a paying as well as a collecting banker, It is however an

important function of crossed Cheques. A large part of this work is carried out through the bankers clearing house.

A clearing house is a place where representative of all banks of the city get together and settle the receipts and payment of Cheques drawn on each other. As the collecting banker runs certain risks in receipt of their ownership the law has provided certain protections to the banks.

The Negotiable Instrument Act, 1881, lays down hat drawer or holder of a cheque or draft may cross the instrument generally or specially. It further lies down that a crossed Cheques can only be paid to a banker, who collects it for a customer in good faith and without negligence.Major functions of clearing department are as under:

Cheques drawn on different banks in this city but deposited in different branches of NBP out of region (Like Quetta, Kohat,Lahore Islamabad and Karachi etc.) These branches send the Cheques for clearing with a covering schedule (A Documents) to main branch of city.

Main branch received these Cheques and prepare a twin paper advise call Fan ford or F-15. This twin paper in which one is debit voucher and other is credit voucher. Main branch send the debit voucher to NBP branches which send the Cheques for collection. Branch keep credit voucher for record.

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Secondly cheques which are drawn on different banks in the city or may be out of city. But the cheques are deposited in different NBP branches within the region in which account holders maintain their account. These branches are also known as clearing members. Clearing member branches send the cheques for collection directly to those banks on which cheques are drawn but send a credit voucher (F-15) to main branch of the region.

TYPES OF CHEQUES COLLECTED

TRANSFER CHEQUES:Theses are those cheques, which are collected and paid by the same branch of bank.

TRANSFER DELIVERY CHEQUES:

These are those cheques, which are collected and paid by two errant branches of the same bank situated in the same city.

CLEARING CHEQUES:These are those cheques, which are drawn on the branches of some other bank of the same city or of the same area, which is covered by a particular clearing house.

COLLECTION CHEQUES:These are those cheques, which are drawn on the branches of either the same bank or of another bank, but those branches, are not in the same city or they are not the members of clearing house.

FUNCTIONS OF CLEARING DEPARTMENT:To accept Transfer, Transfer delivery, clearing and collection cheques from the

customers of the branch and to arrange for their collection. To arrange the payment of cheques drawn on the branch and given for collection to any other branch on MCB or any other members or sub member of the local clearing house.      

To collect amount of cheques drawn on members, sub-member of local clearing house, sent for collection by MCB Branches, not represented at the local clearing house.

CLEARING PROCESS (FLOW CHART) Slip is asked & filled Cheques with slip given Cheques along with slip checked, signed & received by officer Entries in daybooks are made Entries checked & verified by another officer after banking hours by officer Cheques collected at the day end by Main Branch’s Officials Cheques are sent to respective banks next day after posting in computer by Main

Branch The same day not honored cheques are returned to Main Branch

The day after tomorrow the banks are informed about dishonored cheques

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Provisional entries for returned cheques are debited again in both computer & daybooks

Party is informed about returned cheques through Phone or personal contact Cheques are mailed through TCS in case of no personal contact the same day (If there is any availability).

REMITTANCES DEPARTMENT:ISSUING OF DEMAND DRAFT:

DD can be issued to customer whether he is maintaining his account in the branch or not.

Bank issue DD to customer and mentioned the name and account number on which it has to be deposited. After issuing DD, bank sends an advice to those branches on which DD are issued.

ISSUING OF MAIL TRANSFER: Criteria of issuing MT are almost same as issue the DD. But the difference is

charges and procedure. MT is issued and sends by bank to other bank. Bank sends MT with an advice to responding branch. Responding branch received the MT and also sends back advice.

Payment of MT is also possible on ex-advice.

ISSUING OF TELEGRAPH TRANSFER:Fax machine or telephone is use for TT. TT is quickly debit to the drawee

account. Particulars of all inland Telegraphic Transfer issued is entered in the TT section of the drafts, mail transfer and telegraph transfer issued register and check by the officials who append the check signals to the telegrams, after he has satisfied himself that the relative vouchers are in order. ISSUING OF PAY ORDER:

Pay Order can be deposited within the city branches of NBP. When bank issue the Pay Order it credit the amount in the book. While when bank receive the pay order through clearing for payment bank debit it in the book.

DEPOSITS:To receive deposits is a basic function of all commercial banks. Commercial

banks do not receive these deposits for save keeping purpose only.

ACCOUNT OPENING PROCEDURE:A written application on prescribed form bearing proper introduction is furnished

and signed by the manager operation after satisfaction regarding the customer.After opening the account a letter of thanks (F-528) is send to customer’s mailing

address and other letter of thanks (F-529) is send to introducer’s mailing address. No cheque book is issued to a new account holder until confirmations of both the above letters of thanks. Following persons can open an account:

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1)-Sole proprietors2)-Private accounts (individual A/Cs)3)-Joint account4)-Limited Company 5)-Partnership Company6)-Club, Society & Association

Basically following information is required: Name Address

Telephone no. Currency of account Nature of Business Residential status Special instruction regarding the account Signature of the applicant

CREDIT DEPARTMENT:

Attended OfficerMr. Muhammad Amin(Credit Manager)

Time Spent 15 Days

CASH FINANCE:Under such cash credit, account is opened in the name of the customer who

borrows from the bank.Customer is granted a loan up to a certain limit which is sanctioned by the head

office, which he draw when he requires interest is charged on the amount actually utilized by the customer. In order to avoid the danger of idle fund, the bank charges are certain rate of interest, even if the customer does not withdraw any amount.

The credit is usually given against the securities of goods or merchandise as follows:

i. Advances against Pledge Stock:When a cash is granted against the pledge of stock or product, cash credit form is

taken, from the certain products or stock, but the actual pledge is created when the stock or finished product are placed under the bank's lock and key or the document of title are duly endorsed to the bank by the borrower.

ii. Hypothecation of stock on Finished Products:The difference between pledge and hypothecation is that under a pledge

the borrower's goods are placed in the bank's possession under own lock, whereas, under a hypothecation, they remain in the possession of the borrower or guarantor and are merely charged to the bank under documents signed by them.

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iii. Mortgages of property:A title deed of immovable property is accepted by the bank only as

collateral security or alternatively as unauthorized security.

DEMAND FINANCE: (DF)

Demand Finances are those advances which are allowed in lump sum for fixed period and are repayable lump sum or gradually in installments. In Demand Finance a limit is sanctioned against above securities to borrower. Borrower repays this loan in installments. Bank charges floating (KIBOR) plus fixed rate of interest which decide after the negotiation with the borrower.

ADVANCE SALARY:NBP provide the facility to get 20 advance salaries for government employees.

Maximum time period to avail this facility is 5 years for the employee. Bank is charge 13% mark up against this facility.Basic documents which are required for giving advance salary as under:

Computerized ID Card Service Card Two References Three latest salary slip

Three cheques Note: Employee must have his bank account in the branch.

HOME FINANCE:Saibaan Home Finance is product to purchase home. For availing this facility a

government employee must have his salary at least Rs.5,000. While employee of a private firm must have his salary at least Rs.10,000.

Customer maintains his account in branch in which his salary credit every month. In case of businessman it is not necessary to maintain the account in the branch. However he must have his account in any other bank. Bank keeps the ownership of home with itself till the customer pay the due installments.

BILLING AND GOVERNMENT RECEIPT/PAYMENT

This department is performing following functions

Collection of utility bills

Collection of dues of education institution

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Payment of salaries

Payment of Zakat

Payment of pension

DECLARATION OF RATES OF PLS PROFIT / INTEREST ON VARIOUS DEPOSITS(From 01-01-2007 to 30-06-2007)PLS DEPOSITS:TITLE OF ACCOUNTS TENTATIVERATES W.E.F.01-07-20071. Special Notice Deposit’sa). 7 to 29 days Notice 1.20% p.a. b). Over 30 days Notice 1.20% p.a.2. Saving Account’sa). Upto Rs.20,000/- 0.20% p.a. b). Above Rs.20,000/- 1.20% p.a.3. Term Deposit’sa). Three months 1.50% p.a. b). Six months 1.80% p.a.c). One year 2.00% p.a. d). Two years 2.30% p.a.e). Three years 2.60% p.a. f). Four years 2.90% p.a.g). Five years

3.30% p.a.h). Above five years 4.00% p.a.NBP PREMIUM AAMDANI CERTIFICATE:Sr. No. Monthly Income Scheme ProfitRates1. 1st Year (from 1 to 12th months) 7.50%p.a. 2. 2nd Year (from 13 to 24th

months) 8.50%p.a.3. 3rd Year (from 25 to 36th months) 9.50%p.a. 4. 4th Year (from 37 to 48th months)

10.50% p.a.5. 5th Year (from 49 to 60th months) 11.00%p.a.

NBP PREMIUM SAVER ACCOUNT 7.25% p.a.NBP PLUS TERM DEPOSIT CERTIFICATE:

Slabs wise expected rate p.a.Period 0.500-100 101-500 501-1000 Over 1000

1) Year 4.50% 4.75% 5.25% 5.75% 2) Years 4.75% 5.00% 5.50% 6.00%3) Years 5.00% 5.50% 6.00% 6.50% 4) Years 5.50% 6.00% 6.50% 7.00%5) Years 6.00% 6.50% 7.00% 7.50% 6) Years 6.50% 7.00% 7.50% 8.00%7)Years 7.00% 7.50% 8.00% 8.50% 8)Years 7.50% 8.00% 8.50% 9.00%9) Years 8.00% 8.50% 9.00% 9.50% 10) Years 8.50% 9.00% 9.50% 10.00%

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NBP ISLAMIC BANKING:

NBP is proud to expand its range of products and services to include Shariah Compliant Islamic Banking products, now available at our dedicated Islamic Banking Branch located at Cotton Exchange Building, I.I. Chundrigar Road, Karachi.

ISLAMIC BANKING MISSION:“To become a leading player in the growing field of Islamic Finance in Pakistan and abroad, providing depositors and shareholders in a truly SHARIAH COMPLIANT way, the best combination of returns and future growth

ISLAMIC BANKING VISSION:Set standards of best practices and performance through efficient asset allocation, and offer / develop products based on the true spirit of Islamic finance.

PRODUCTS AND SERVICES AVAILABLE AT ISLAMIC BANKING BRANCH

Products and services being offered by our Islamic Banking Branch are fully Shariah Compliant and have been certified by NBP’s Shariah Advisor.NBP Islamic Banking -

DEPOSIT SCHEMES: Deposit Schemes being offered by NBP’s Islamic Banking Branches would include the following: Current Deposit Scheme Profit & Loss Sharing (PLS) Deposit Scheme Current Deposit Scheme

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Ideal for customers looking for security of their funds along with absolute convenience in its use, in the form of Current accounts.Funds deposited with the bank will be utilized by the bank at its sole discretion in Shariah acceptable avenues.

The Customer will have the flexibility to withdraw a part or the whole of their balances at any time as per their requirement. This is a non remunerative deposit scheme and thus the customer will not be sharing the profits nor will be sharing losses (if any). However, the Bank may at its absolute discretion give rewards to these Depositors depending upon the operational results of the Bank. Losses will not be passed on to these Depositors.Other terms, conditions and rules for Current Deposit Accounts to be advised by the Bank at the time of opening of Account. Profit & Loss Sharing Deposit (PLS) Scheme PLS Saving Deposits Scheme (to be accepted in future) will accept deposits on Mudaraba basis, where the depositor will be Rabb-ul-Mal and Bank will be Mudarib. The Bank will invest the deposited funds at its (Bank’s) sole discretion in Shariah acceptable avenues. The Depositor will have the flexibility to withdraw a part or the whole of their balances at any time as per their requirement. The Bank will give profit to the Depositors twice in a year in January and July, on the basis of agreed ratio of actual profits to be announced by the Bank from time to time.

In the event of financial loss, the PLS depositors will bear the loss in proportion of their investment. The Depositors will not participate in the management of the business of the Bank Other terms and conditions as well as rules for PLS Deposit Account to be advised by the Bank at the time of opening of Account.

NBP Islamic Banking - FINANCING FACILITIES:

Commercial and Corporate customers requiring financing will have the following financing facilities available to them to meet their requirements:

MURABAHA:Murabaha may be defined as a contract between a Buyer and Seller under which the Seller discloses to the Buyer the cost of goods being sold and adds an agreed profit. Price is payable on spot or at a certain future date, in lump sum or in installments (deferred payments).

MURABAHA FACILITY:Under the MURABAHA FACILITY, the Bank will first purchase the required goods directly or through an Agent. All costs incurred on such purchases will be borne by the Bank. Subsequently the Bank will sell the goods to the customer on deferred payment basis (30 days to one year) at an agreed price comprising cost of goods purchased and Bank’s profit.

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On due date the customer will pay to the Bank the agreed price, in lump sum or as per the agreed installment schedule.

IJARAH (LEASING) Ijarah means “to give something on rent”. The term “IJARAH’ is analogous to the English term “leasing “.Firstly the Bank will purchase the Assets as required by the Customer and subsequently the assets will be leased to the Customer on the terms and conditions as agreed with him.Ijarah Facility will be offered for the following assets: Vehicles (both Commercial and Private) Office Equipment Plant and Machinery

NBP Islamic Banking - OTHER SERVICES: In addition to Shariah acceptable standard general banking services, following services are also being offered at the Islamic Banking Branch:

• Letter of Credit Facility

• Handling of Remittances • Issuance of Bank Drafts and Pay Orders. • Collection of Export Bills. • Collection of Local Bills. • Government Collections • Utility Bills Collection

PRODUCTS AND SERVICESPRODUCTS:

National Bank of Pakistan (NBP) ADVANCE SALARY:

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Take upto 20 advance salaries (currently for NBP account holders of govt. or related organization employees

In January-2003, National Bank of Pakistan has launched a unique product, ‘NBP-Advance Salary’. Currently this product is for fixed-income permanent employees of Federal & Provincial Government, Semi-Government, Autonomous, Semi-autonomous, local bodies and other Government organizations. The product is purely cash flow based and offers its holder to avail 20 (twenty) net salaries in one go to be repaid in up to 60 (sixty) months. With no collateral, insurance or requirements, Advance Salary provides rapid disbursement in a short turnaround time.

NBP CASH CARD:

ATM + Debit Card Use it as an ATM in ay of the ATM’s in Pakistan

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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 ATM0 PIN change facility (only at NBP ATM)

NBP SAIBAAN:HOME FINANCE

PRODUCT ITEMS Home Finance Home Renovation Home Construction Purchase of Land + Construction Balance Transfer Facility (BTF) Home Purchase (House or Apartment) * - Product Detail Financing Amount Upto 35 Million Financing Period 3 to 20 Years Debt to Equity 85:15 (Maximum) Home Construction * - Product Detail Financing Amount Upto 35 Million Financing Period 3 to 20 Years Debt to Equity 85:15 (Maximum) Home Renovation * - Product Detail Financing Amount Upto 15 Million Financing Period 3 to 15 Years Debt to Equity 70:30 (Maximum)

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Purchase of Land and for Construction thereon * - Product Detail Financing Amount Upto 35 Million Financing Period 3 to 20 Years Debt to Equity 70:30 (Maximum) Re-Financing (Balance Transfer Facility (BTF)) - Product Detail If you have a Home Finance Facility outstanding with another bank you can have it transferred to NBP through a hassle-free process. All home financing facilities below Rs. 15 M Debt to Equity Ratio will be 85:15 & for Rs. 15 M and above Debt to Equity Ratio will be 80:20.*50% of the loan will be disbursed at the time of land purchase and rest of the 50% for its construction will be disbursed in 4 trenches.

NBP CASH n GOLD: Meet your need for ready cash against your idle gold jewelry with no minimum limits Get extra benefit from your goldWith NBP's Cash n Gold, you can meet your need for ready cash against your idle gold jewelry. Rate of mark-up 13% p.a. Facility of Rs. 7,000 against each 10 Gms of net contents of gold No maximum limits of cash Repayment after one year Roll over facility Only gold ornaments acceptable Weight and quality of gold to be determined by NBP's appointed schroffs No penalty for early repayment.

NBP INVESTOR ADVANTAGE NBP launches Margin Financing for Retail Investors with brand name of NBP Investor Advantage.A margin financing facility developed for retail investors in line with Government’s efforts to promote Pakistani capital markets and will replace the Badla (COT) system with a stable financing system in line with international financial markets. Besides offering a comfortable environment to the retail stock investors, a financing facility will also be available. Willing investors can avail NBP financing at very easy terms requiring minimum documentation and least turn around time. The NBP financing also does not require any security from the customer except for the customer’s equity. Importantly, the customer’s equity will also be freely available for investment. Customer has to fulfill all NBP and SBP regulatory requirements. To obtain NBP Investor Advantage facilityEligible if:• A Pakistani Nationals with valid computerized national ID Card• Over 21 years of age• Have an account with NBP designated branch• Willing to invest equity in the form of cash or NBP approved shares

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• No default with any financial institution

For utilizing the NBP Investor Advantage, please follow the following simple steps:

1. Obtain Facility Application form from the NBP Margin Financing Desk at NBP Main Branch, Karachi, and I.I. Chundrigar Road, Karachi (other branches are being added through out Pakistan) 2. Fill in the application form and submit it to the branch at the Margin Financing Desk 3. On application approval, customer deposits equity as Cash in the customer’s margin financing account at the bank. Alternately NBP approved Shares can also be deposited in the NBP CDC account 4 Customer would then be eligible for trading through trading center of the NBP Subsidiary namely Taurus Securities Limited adjacent to the NBP Main Branch at I.I. Chundrigar Road, Karachi 5 Customer’s own equity and financing amount will both the available for trading.

List of Shares Eligible for NBP Investor Advantage

S.no No Name of Shares/ Scrips

1 D.G Khan Cement Company Limited

2 Engro Chemical Pakistan

3 Fauji Fertilizer Co.

4 Hub Power Company Limited

5 PICIC Growth Fund

6 Kot Addu Power Company

7 Nishat Textile Mills Limited

8 Oil & Gas Development Co. Ltd

9 Pakistan OILFIELD LTD.

10 Pakistan Petroleum Limited

11 Pakistan State Oil

12 PTCL

13 Sui Northern Gas Pipe Lines Limited

14 Sui Southern Gas Company Limited

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NBP KAROBAR:

President's Rozgar Scheme,If you are aged between 18 and 40Years, you could be eligible for easy Financing for self employment inThe categories below:

NBP Karobar Utility Store NBP Karobar Mobile Utility Store

NBP Karobar Mobile General Store NBP Karobar Transport

NBP Karobar PCO/ Tele-Centre

KAROBAR DETAILS: Details in Urdu Click here [PDF 2.85 MB] Government of Pakistan (GOP) support: 1. Life and disability insurance paid by GOP with no medical examination required.2. 6% mark-up paid by customer, rest paid by GOP.

* Subject to availability of subsidy/confirmation from GOP.Note: The mark-up rate will be revised on annual basis.

Financing Terms & Conditions Minimum Down Payment 10% of asset price (5 % for PCO and Tele center)

Mark-up Rate Variable1 year KIBOR + 2% (For the first year mark-up will be 12%) The customer will pay markup @ 6%p.a as long as GOP provides the balance markup to NBP on a monthly basis)Tenure

Another step towards your prosperity

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1 to 5 Years (for PCO 2 years) Grace PeriodInitial 3 months Maximum Loan AmountRs. 200,000/-

NBP Karobar Utility Store (Under a Franchise with Utility Store Corporation) Financing will be provided to set-up a Utility Store under franchise of Utility Store Corporation through• Set-up of a Utility Store in an owned/rented shop• A 'Mobile' Utility Store: 4 stroke Petrol/CNG/LPG Vehicle (Rickshaw) with attached loader body \(Thehla type or Store)

Eligibility Criteria• Must be Pakistani national bearing a Computerized NIC • Age between 18 to 45 years• Must be residing in the same city / district for the last 2 years • Must have a franchise from Utility Stores Corporation of Pakistan• Must have a valid rickshaw driving license (for mobile utility store)• Availability of 2 references & 1 guarantor (USC shop setup• No default or rescheduling history of the applicant • References and guarantor must be residing in the same city / district where the applicant is residing

SecurityIn case of Utility Store shop set ups:• Hypothecation charge over the present and future assets in store (except stock).• One guarantor, having minimum net income of Rs. 10,000/-p.m. (subject to NBP verification) or must be property owners • Personal guarantee of the applicant• 4 cross cheques

In case of Mobile Utility Stores:• A lien would be marked under hire purchase/hypo agreement on the vehicle• Personal guarantee of the applicant• 4 cross cheques

NBP Karobar Mobile General Store Financing will be provided to purchase 4 strokes Petrol/CNG/LPG Vehicle (Rickshaw) with attached loader body (Thehla type) to set up Mobile General Store without USC Franchise Eligibility Criteria• Must be a Pakistani national bearing Computerized NIC • Age between 18 to 45 years• Must be residing in the same city/ district for the last 2 years • Availability of 2 references

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• No default or rescheduling history of the applicant • References must be residing in the same city / district where the applicant is residing

Security• A lien would be marked under hire purchase/hypo agreement on the vehicle• Personal guarantee of the applicant• 4 cross cheques

NBP Karobar Transport Financing will be provided to purchase a 4 stroke Petrol/CNG/LPG Vehicle (Rickshaw)Eligibility Criteria• Must be a Pakistani national bearing Computerized NIC • Age between 18 to 45 years• Must be residing in the same city / district for the last 2 years • Availability of 2 references having landline telephone numbers • No default or rescheduling history of the applicant • References must be residing in the same city / district where the applicant is residing

Security• A lien would be marked under hire purchase/hypo agreement on the vehicle

• Personal guarantee of the applicant• 4 cross cheques

Women and Poverty• Women of today is not the women of yesterday she is more knowledgeable more confident, and more dynamic. To salute the women of Pakistan, NBP introduces loan products for the women of Pakistan to bring them out from the hardships of poverty, through the following self-employed schemes of NBP Karobar

NBP KAROBAR PCO: Finance will be provided to purchase Wireless/ Mobile/Desktop telephone set(s) with prepaid connection and credit balance(s) to establish a PCO setup

Eligibility Criteria• Must be Pakistani national bearing a Computerized NIC • Age between 18 to 45 years• Must be residing in the same city/ district for the last 2 years • Availability of 2 references & 1 guarantorNumbers• No default or rescheduling history of the applicant• References must be residing in the same city / district where the applicant is residing

Security• Hypothecation charge over the present and future assets of the business

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• One guarantor, having minimum net income of Rs. 10,000/- p.m. each (Subject to NBP verification) or must be a property owner for single telephone set minimum income requirement for guarantor is Rs. 5,000/- per month and for multiple sets Rs. 10, 000/- per month.• Personal guarantee of the applicant• 4 cross cheques

NBP Karobar Tele-centre Finance will be provided to purchase Wireless/ Mobile/Desktop telephone set(s) with connection, computer(s) and printer cum fax machine cum photocopier cum scanner etc to establish a Tele-centre on a rested shop or owned premises

Eligibility Criteria• Must be Pakistani national bearing a Computerized NIC • Age between 18 to 45 years• Must be residing in the same city/ district for the last 2 years • Availability of 2 references & 1 guarantorNumbers• No default or rescheduling history of the applicant• References and guarantor must be residing in the same city / district where the applicant is residing

Security• Hypothecation charge over present and future assets of the business• One guarantor, having minimum net income of Rs. 10,000/- p.m. (Subject to NBP verification) or must be a property owner.• Personal guarantee of the applicant• 4 cross cheques

Repayment • No payment during grace period• Monthly installment comprises of principal, mark-up and insurance payments• The customer, at any point of time, may exercise the right to fully adjust the account before maturity or to partially pay the loan through balloon payment without any penalty.Documents to be submitted with the Loan Application

• Application form (available for Rs.5/- from all NBP branches)• List of items available in the scheme• Three attested Computerized NIC copies of the applicant and guarantors each • Two photographs of applicant and guarantors each (if applicable) • Franchise acceptance letter from Utility Stores Corporation (where applicable) • Estimated cost of advance rent, security deposit and assets, to be purchased along with quotation (where applicable)• Attested salary slip of guarantor (where applicable)

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• NTN or latest Tax Return if available of guarantor (if a business person)• Proof of property ownership of the guarantors (where applicable)

Processing, Verification & Registration Charges (if applicable) Verification Charges Rs. 500 (non refundable)Rs. 300 for NBP Karobar PCO (non refundable) Processing Charges 1% of the loan amount(For loan amount upto Rs.30, 000/-) (Non refundable) Rs. 1,000/- (for loan amountAbove Rs.30, 000/- - non refundable) Note: All charges submitted with application are non refundable at any stage. Document Charges At actual Vehicle Registration At actual (To be borne by the borrower) Insurances Property/ Assets insurance to be borne by the borrowerLife & Disability insurance to be borne by GOP.

Government of Pakistan (GOP) support: 1. Life & Disability insurance paid by GOP requires no medical examination.2. 6% mark-up to be paid by the customer and rest by GOP *Subject to availability of subsidy / confirmation from GOP

Note: The mark-up rate will be revised on annually Note: Applicants for all products must provide their landline/ WLL telephone numbers or provide the landline/WLL telephone numbers of their relatives, friends, neighbors etc,. However, telephone numbers must be of the same city/ district where the applicant is residing.

NBP PRTECTION SHIELD: Personal Accident InsuranceNo medical requiredNo documentationPremium auto deduction facilityChoice of deactivation includes death due to:

Natural Calamities e.g. earthquake, Flood, Cyclones etc. Accident Riots Civil commotion Strikes Acts of terrorism

NBP KISAN DOST: Agriculture farming program

Competitive mark up rate Quick and easy processing Delivery at the farmer’s doorstep Technical guidance to farmers

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Wide range of financing schemes for farmers Loan facility on revolving basis for three years.

NBP ONLINE: Aasan banking online branch banking

Balance enquiry Statement of account Stop payment Cash deposit to own and third party account Cash withdrawal through cheque Transfer of funds to own and third party account.

NBP HELP LINE 0800 - 80080 NBP CALL CENTER-WEBSITE INFORMATION

In an era of heightened customer demands and increased competition, Call Centers have become a crucially important mechanism to cost-effectively serve customers and sell products. National Bank of Pakistan realized that it needed not only to establish its Call Center by providing a one-stop service for all customer enquiries related to the bank's products & reengineer its delivery processes, but also to ensure that it provides the same level of out-standing service across channels to give a consistent customer experience.

NBP has taken a step towards improving customer services by establishing a state of the art Call Center with a Help Line Toll Fee Number 0800-80080 working in two shifts from 8:30 am till 10:30 pm to provide instant service to all the existing & prospective customers on all the NBP products being offered by the bank specially NBP Karobar. Presently, the Call Center is receiving more than 1500 calls per day for resolving customer based product enquiries and complaints.

SERVICES.

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

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

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Manage the monetary aspect of NBP’s relationship with the correspondents to support trade, treasury and other key business areas, thereby contributing to the bank’s profitability

Generation of incremental trade-finance business and revenues

 NBP OFFERS:

The lowest rates on exports and other international banking products Access to different local commercial banks in international banking

DEMAND DRAFTS: If you are looking for a safe, speedy and reliable way to transfer money, you can

now purchase NBP’s Demand Drafts at very reasonable rates. Any person whether an account holder of the bank or not, can purchase a Demand Draft from a bank branch MAIL TRANSFERS Move your money safely and quickly using NBP Mail Transfer service. And we also offer the most competitive rates in the market. PAY ORDER * NBP provides another reason to transfer your money using our facilities. Our pay orders are a secure and easy way to move your money from one place to another. And, as usual, our charges for this service are extremely competitive.

TRAVELER'S CHEQUES

Negotiability: Pak Rupees Traveler’s Cheques are a negotiable instrument

Validity: There is no restriction on the period of validity Availability: At 700 branches of NBP all over the country Encashment: At all 400 branches of NBP Limitation: No limit on purchase Safety: NBP Traveler’s Cheques are the safest way to carry our money LETTER OF CREDIT NBP is committed to offering its business customers the widest range of options in the area of money transfer. If you are a commercial enterprise then our Letter of Credit service is just what you are looking for. With competitive rates, security, and ease of transaction, NBP Letters of Credit are the best way to do your business transactions.

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COMMERCIAL FINANCE Let us help make your dreams become a reality

Our dedicated team of professionals truly understands the needs of professionals, agriculturists, large and small business and other segments of the economy. They are the customer’s best resource in making NBP’s products and services work for them.FOREIGN REMITTANCES To facilitate its customers in the area of Home Remittances, National Bank of Pakistan has taken a number of measures to:Increase home remittances through the banking system Meet the SBP directives/instructions for timely and prompt delivery of remittances to the beneficiaries

NEW FEATURES:The existing system of home remittances has been revised/significantly improved and well-trained field functionaries are posted to provide efficient and reliable home remittance services to nonresident Pakistanis at 15 overseas branches of the Bank besides United National Bank (the joint venture between NBP and UBL in UK). and Bank Al-Jazira, Saudi Arabia. Zero Tariff: NBP is providing home remittance services without any charges. Strict monitoring of the system is done to ensure the highest possible security.

Special courier services are hired for expeditious delivery of home remittances to the beneficiaries.

Types of home remittances: Send Pak Rupees to beneficiary's bank account at any bank in Pakistan Send a Pak Rupee Pay Order/Demand Draft directly to beneficiary's residence or

work place. Send US Dollars to beneficiary's bank account at any NBP foreign exchange

branch in Pakistan SWIFT SYSTEM

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

SHORT TERM INVESTMENTS

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

N.I.D.A National Income Daily Account The scheme was launched in December 1995 to attract corporate customers. It is a current account scheme and is part of the profit and loss system of accounts in operation throughout the country.

TRADE FINANCE OTHER BUSINESS LOANSAGRICULTURAL FINANCE: NBP provides Agricultural Finance to solidify faith, commitment and pride of farmers who produce some of the best agricultural products in the World.

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

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

Providing reliable infrastructure for agricultural customers Help farmers utilize funds efficiently to further develop and achieve better

production Provide farmers an integrated package of credit with supplies of essential inputs,

technical knowledge, and supervision of farming.

NBP also provides the following subsidized with ranges of 3 months to 1 year on a renewal basis. Operating loans Land improvement loans Equipment loans for purchase of tractors, farm implements or any other equipment Livestock loans for the purchase, care, and feeding of livestock Production Loans: Production loans are meant for basic inputs of the farm and are short term in nature. Seeds, fertilizers, sprayers, etc are all covered under this scheme.

CORPORATE FINANCEWorking Capital and Short Term Loans: NBP specializes in providing Project Finance – Export Refinance to exporters – Pre-shipment and Post-shipment financing to exporters – Running finance – Cash Finance – Small Finance – Discounting & Bills Purchased – Export Bills Purchased / Pre-shipment / Post Shipment Agricultural Production Loans

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

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

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

WORK DONE BY ME

In NBP Main Branch Bahawal Nagar I really enjoyed working with the staff and having a wish to be employee of NBP. It was almost impossible to work in all the departments within that limited time. But on my request, the staff of the branch provided me the opportunity to work in the different departments for the sake of practical knowledge. I feel highly indebted to work in this Branch on the request of the manager of

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that branch Mr. M. Arshad Nagra, because I learnt a lot in that branch.During my internship training in the NBP as I early mentioned that I have worked in different departments & seats and learnt the followings.

UTILITY BILLS COLLECTIONNBP collects utility bills on behalf of WAPDA, Sui Gas Companies, and Pakistan

Telecommunication Corporation Limited by putting the stamp on the utility bills “Paid”, Date of payment, Signature of the officer receiving the utility bills. After receiving utility bills a list is made on the form which is called Bills scroll form. One copy of the scroll is with the bank for evidence whereas the original copy with the receipt of the bills is sent to the billing department of the respective corporation. The bank charge commission on the bills.

OPENING NEW ACCOUNT BASICSDuring the span of mine internship in NBP I learned and observed a lot of about

the opening of an account. Basically I think that the opening of an account is the establishment of a contractual relationship between the banker and the customer. By opening an account at a bank a person becomes a ‘customer’ of a bank. Further I am going to express the basic requirements and steps involved in the opening of an account.

INVESTIGATIONBefore opening an account NBP as like the other banks in Pakistan ascertain

whether or not the person who is going to open the account is a desirable customer or not. Then NBP determine the prospective customer’s integrity, respectability, occupation and the nature of business by the introductory references given at the time of account opening. Negligence in this informal preliminary investigation may result in serious consequences not only for the banker concerned directly but also for other bankers and the general public who may be affected indirectly. In Ladbroke & Co. V Todd (1914), the banker did not obtain introduction at the time of opening the account, and it was construed a negligence within Section 82 of the Bills of Exchange Act 1882.In order to further strengthen and streamline this process, the Federal Ombudsman of Pakistan, vide his ruling on complaint No. II/31/5186, has directed the banks to retain with the account opening form a Photostat copy each of the National Identity Cards of the person desiring to open an account as well as that of the introducer. As per these directions, the concerned Branch Managers are required to obtain the original National Identity Cards along with their Photostat copies and then return the original after attesting the authenticity of the retained copy.

HOW TO OPEN AN ACCOUNT (IN GENERAL)

Before opening an account in NBP I observed that the following points must be considered in this regard.

Another account holder of the bank should properly introduce the new customer. The account holder should sign the account opening form in the presence of bank

officer and the signature is duly verified.

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A copy of identity Card is required by Bank. Against submission of the Bank’s prescribed application form, duly introduced in

the manner provided and on supplying such document, as may be required and account may be opened. The Bank reserves to itself the right to refuse to open and account without assigning any reason.

Each account shall be allotted a distinct number that is to be quoted in all correspondence with the bank relation to the account.

Minimum amount to open an account is required regarding the nature of account.

PROCEDURE TO OPEN AN ACCOUNT:According to my practice in NBP, when a customer wants to open an account, the

bank officer gives him an application form. All information, which is necessary to be known by the bank, are requirements of the application form. Form also requires the essential documents to be attached by the customer.

Basically following information is required to open an account with NBP

a. Title of Accountb. Full Name of Applicantc. Occupationd. Addresse. Telephone No.f. Currency of accountg. Nature of Business h. Introducer’s Name, Address & Signaturesi. Special instruction regarding the accountj. Initial Amount of the Depositk. Signature of the applicant

PROCEDURE TO HONOUR A CHEQUE:During my internship training in the National Bank of Pakistan, I observed and found

Cheques are received for the following purposes.a. For Cash payments b. For transfer(from one account to another account) c. For Clearing

FOR CASH PAYMENTS:Cheques which are presented on Bank counter must be checked in the following

way:

a. Date. b. Signature of Drawer.c. Signature of Payee.d. Whether Bearer has cancelled.e. Whether Payee account duly is there.f. If condition 4&5 exist then check the signatures of Drawer.g. Match the figure and wordily amount of cheque.

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When all above matters are satisfied then come to the Token register and check:a. Token number.b. Cheque number.c. Amount of cheque.d. Particulars.

Two stamps are put on cheque.a. Cash Payment (on the face of cheque).b. Stamp for Token (on the back of cheque).

On stamp which is put for token their details are as follows:a. Token number.b. Time of giving token to client.c. Signature of token giver.

Note:

Payment is also made when cheques of same branch account is presented for transfer to other account in same ranch along with cheque for payment.

CHEQUE FOR TRANSFER

When cheques are presented to be sent for collection and drawn on bank situated within the city then there are three stamps to be put on face as well as on back of cheque.

Crossing Stamp (face). Transfer Stamp (face).Bank Manager Stamp (back). Only in NBP branches.

CHEQUES FOR CLEARINGThere are two stamps put on each cheque, sent for clearing:

a) Crossing Stamp.b) Manager Stamp.

CHEQUES IN COLLECTION

When cheques received in clearing are intra city then these are controlled under CC.

First of all, these cheques are recorded in day book then allotted number and then serial number. Then a Performa is prepared in which Bank on whom was drawn, cheque number, amount, beneficiary name are recorded. After completing that Performa cheque is posted along with Performa.

CLEARINGFollowing information is entered in clearing register.a) Name of favoring party.b) Name of bank on whom drawn.c) Branch.d) Cheque number.

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e) Amount.

Clearing is sent after entering in register. In clearing register future date and day is putted. Cheques and vouchers are then separated and Cheques are sent for clearing.Clearing credit vouchers are entered on clearing sheet. Such credits are balanced by giving debits to cheques received in clearing from other branches. At the beginning of the day clearing return sheet is received. Vouchers are made ifClearing delivered is more than clearing received then Credit voucher.

On the same day, credit vouchers sent for clearing are entered on the sheet's credit side.Cheques are sent to NIFT after taking them on calculator, their total amount along with total number of instruments. A summary is prepared and sealed after noting the number of seal in summary.Telephonic Transfer DD- Demand Draft PO- Payment Order

For T.T, the account of beneficiary must be there in branch. DD is also prepared and beneficiary can get payment.

First of all, Performa is filled by purchasing party along with cheque or cash payment. When cheque is received it is first posted in computer section in order to check the balance of account.

SWOT ANALYSIS OF NBP

SWOT analysis is analysis of four important factors faced by an organization. These factors are strengths, Weaknesses, Opportunities and Threats. These factors play a vital role in success or collapse of an organization. In today’s world only those organizations survive which has the ability to manipulate these factors effectively to the best interest of organization. Of course, two factors are in internal environment that are strength and Weaknesses, with an effort of management these can be controlled to a great extent. While opportunities and threats are present in external environment and need to be completed with. Here is an outlook of SWOT analysis of Branch NBP.

STRENGTHS: Good pay scale for employees as compare to other commercial banks which are

good incentive for recruitment of new employees. Due to frequent visit of higher management to all Branches, good internal control

of management on its branch Network. Regular training of staff about various operation of the bank, like computer, CIB

reports etc. Cooperation among employees resulting in good working environment. Regular internal audits of all the branches by NBP internal auditors.

WEAKNESS: Lack of computers for the storage of financial data.

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The outlook of branches is not up to date as compare to other commercial banks in Pakistan

Working conditions for employees are not good as there is lack of facilities in small branches.

Very slow procedure of upgrading of the employee resulting in very few chances for promotion.

OPPORTUNITIES: Largest network of branches in the country Lowest Service Charges as compared to all other commercial banks of Pakistan. Better management. Competent employees.

THREATS: NBP does not have much online banking facility which reduces the overall

customer service facilities. Lack of publicity for its new products like loan etc. A change in Govt. policies may affect the performances of the bank. NBP has to compete with other commercial banks

FINANCIAL ANALYSIS

NATIONAL BANK OF PAKISTANBALANCE SHEET

HORIZONTAL ANALYSISASSETS

Rs.000Assets 2007 2006 INCREASE

(DECREASE)%AGE CHANGE

Cash balances with other

94446552 59420502 35026050 58.94%

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treasury banksBalances With Other Bank

49784884 24154070 25630814 106.11%

Lending to Financial Institutions

10511322 29937857 (19426535) 64.88%

Investments 144735672 166195619 (21459948) 12.91%Advances 221446963 161265760 60181203 37.31%Other Assets 18339514 19059031 (719517) 3.77%Operating Fixed Assets

9202969 8939483 263486 2.94%

LIABILITIESRs.000

LIABILITIES 2006 2005 INCREASE(DECREASE)

%AGE CHANGE

Bills payable 7214671 5496738 1717933 31.25%Borrowing From Financial Institution

11084790 16569673 (5484883) 33.10%

Deposits 465571717 395492331 70079386 17.72%Liabilities Against Leasing

17058 41117 (24059) 58.51%

Other liabilities

22916147 23192585 (276438) 1.20%

CAPITAL Rs.000

REPRESENTED BY

2006 2005 INCREASE(DECREASE)

%AGE CHANGE

Share capital 4924106 4103422 820684 19.99%Reserves 11119613 8133312 2986301 36.71%Un Appropriated Profit

9213565 5897163 3316402 56.23%

Surplus 17679158 9450117 8229041 87.07%

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NATIONAL BANK OF PAKISTANBALANCE SHEET (LIABILITIES)

VERTICAL ANALYSISRs.000

LIABILITIES 2006 %AGE 2007 %AGE

Bills Payable 5496738 1.17% 7214671 1.31%Borrowings From Financial Institution

16569673 3.53% 11084790 2.01%

Deposits 395492331 84.33% 465571717 84.68%Liabilities Against Assets Of leasing

41117 8.76% 17058 3.10%

Other liabilities

23192585 4.94% 22916147 4.16%

Deferred text Liabilities

595864 0.12% ---------- ------------

Share Capital 4103422 0.89% 4924106 0.89%

Un Appropriated Profit

5897163 1.27% 9213565 1.67%

Reserves 8133312 1.756% 11119613 2.02%Surplus on Revaluation of Assets

9450117 2.04% 17679158 3.21%

Total 468972322 100% 549740825 100%

PROBLEMS FACED BY NBP MAIN BRANCH BAHAWAL NAGAR

Although NBP Main branch was working properly but still there were some areas that needed improvement as the problems are present in the Branch.

Here are some major problems:1) The process of Automation of NBP is very slow. Some branches in rich areas are

being made on line vary quickly, while the branches in the poor areas are receiving no attention.

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2) For the last 6 years or so the management of the bank has not raised the pays of the personnel. This is showing a bad impact on the performance of the employees.

3) The ATM machines installed at various branches are unable to perform well. On observation, I found that in some unimportant areas the second hand machines were installed, while in high class rich and business areas, the machines with first class standard were installed. But while being on line, these machines failed to interact with each other’s effectively.

4) Despite of the fact that NBP is the 1st largest bank in the country. But unfortunately, the bank has no foreign branch. So, the foreign banks are capitalizing the available foreign markets which the bank.

5) The bank has lately entered the market of leasing and financing of home appliances. As a result of this late, the competitors in the marker have managed to capitalize the market potential.

6) The staff of the bank is reluctant to guide the internees, as they show no personal interest in guiding the internees of various disciplines.

7) The management of NBP is continuously cutting the no. of branches, which simply means the unemployment.

RECOMMENDATIONS FOR IMPROVEMENT OF THE BRANCH

From the Quantum of the profit and its financial data it can be easily judged that after privatization, NATIONAL BANK OF PAKISTAN is performing well. Its deposits are growing day by day and so its profitability. The controlling body is responsible for the productive performance of the Bank.Following are my observation and suggestion to improve the efficiency for the development of the economy.

A big portion of the home remittance is sent by Pakistan working capital through NATIONAL BANK OF PAKISTAN 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 other banks and it would be profitable step for bank.

There is a criticism on the banking management that the salaries of the employees are decreasing in every succeeding year. And I think this will shake the confidence and working habit of the employees.

There is another recommendation about the bank that there is no proper timing of the bank and there is made an unnecessary delay in the banking transactions, which might not be a good sign for the bank from future prosperity point of view.

Staff turnover particularly of trained staff result in financial and other losses. The amount spent by the bank on employment, induction and training of

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outgoing officers constitutes to beat till another officer should ready prove this work. The exodus of bank officer in the past has worsened the situation.

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 for the staff are most important in any international organization. Alt the employees should have these courses according to their requirement. Foreign experts can also be called for this purpose.

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 employee should be provided the opportunities to attend and participate in seminars and lectures on banking.

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.

As such system should be designed that every employee who has some problems with his officers can communicate it to the higher management and some steps must be taken to improve that.

Recruitments should be strictly on merit basis and induction should be after proper and extensive training.

Old and lazy staff should be replaced by young, qualified and energetic staff.

Foreign branches should be opened in order to capture the international market and to earn international repute for the bank.

Working environment, equipment, furniture and staff dressing should be according to the modern banking style.

Proper attention should be paid to upgrade customer services. Bank should adopt the global organizational banking structure to meet the

international standards of banking sector.

OVERALL CONCLUSION OF THE BRANCH

The financial year 2006 -2007 has been a very profitable year for the banking industry in the backdrop of rising of interest rates and healthy growth in lending to all the sectors like industry, agriculture, services etc. is evident from this report and the financial statements of NBP that it is making progress by leaps and bounds. The profits of NBP have grown considerably during the last few years and this trend is expected to continue into the future. Therefore, we conclude that NBP has a very prosperous present and future, which assures the shareholders of wealth maximization. Side by side of it I think

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that if bank would be able to cover and control on the above mentioned recommendations then it would be in such a situation that will really lead it towards the road of prosperity, development and integrity.

And with the above mentioned sentences I think there is too fault of the customers and in order to make the proper working of the bank the customers should also cooperate with the bank which will be really a good, ambitious and diligent condition for the bank. And then bank will be really in such a situation and position to compete its competitors in the country as well as on international level.

LIMITATION OF MY INTERNSHIP

It is not possible to get access to all the departments of the bank during internship because in the entire department there is the policy of privacy must be kept by the bank. So that they do not provide all the information of the departments given to the internee.

ANNAXTURE

N.B.P NATIONAL BANK OF PAKISTANS.B.P STATE BANK OF PAKISTANPKR PAKISTAN RUPEEA.T.M AUTOMATIC TELLER MACHINEP.I.N PERSONAL INDENTIFICATION NUMBERP.O PAY ORDERD.D DEMAND DRAFTM.T MAIL TRANSFERT.T TELIGRAPHIC TRANSFERL/C LETTER OF CREDITSWIFT Society for Worldwide Inter bank Financial

Telecommunication

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BIBLIOGRAPHY

Personal ObservationBank rules and regulation

Financial statement of NBPwww.nbp.com.pkInternet search