A Case Study On Nabil Bank ltd.

A CASE STUDY
ON
Nabil Bank Limited





















A fieldwork submitted by:
MR. DURGA BAHADUR KARKI

Submitted to:
GOMENDRA MULTIPLE COLLEGE
ANARMANI, JAHAPA
NEPAL

In partial fulfillment of
the requirement for the degree of
BACHELOR OF BUSINESS ADMINISTRATION

FACULTY OF MANAGEMENT
PURWANCHAL UNIVERSITY













RECOMMENDATION:-
This is to certify the fieldwork report:-


Submitted by:-
MR. DURGA BAHADUR KARKI



ENTITILED:-
NABIL BANK LIMITED
has been prepared as approved by this department,
this fieldwork assignment report is forwarded
for examination.



____________________ __________________
BRANCH MANAGER OF NBL
BIRTAMODE, JHAPA

Supervisor:
Head of the Department
GOMENDRA MULTIPLE COLLEGE
Anarmani, Jhapa
Nepal



ACKNOWLEDGEMENT/PREFACE

I have prepared this thesis entitled case study of 'Nabil Bank Limited' of Birtamode Branch as a part of my study curriculum of BBA third year, 5th semester “Research Methodology”
I would like to thank all individuals who have provided me their precious time and information with full co-operation. I am grateful to Mr. Rudra Shrestha the branch manager of NBL, Birtamode.
I am heartly indebted to Mr. Rupak Khanal the lectures and vice-principal of Gomendra Multiple College for his wonderful guidance and support.
Lastly, I would like to thank all my friends to help to get information.& support without which this project could not be successful.
Thank you

DURGA BAHADUR KARKI Gomedra Multiple College
Birtamode, Jhapa



CHAPTER:1 INTRODUCTION

Origin of Bank:
The origin of banking is strictly related to the history of money. A society became more civilized, the needs for more efficient methods for barter were developed organically. The term ‘bank’ was derived from Latin word ‘Bancus’, Italian word ‘banca’, French word ‘banque’ , which means a ‘bench’ and German word ‘bank’ which means joint stock company.
In ancient time bank was probably the religious temple where gold were stored and that was safe place to store valuable goods. Greek temples as well as private and civil entities conducted financial transaction such as loans, deposits, currency exchange and validation of coinage.
The modern banking has three ancestors who are the merchant, goldsmith and the money lender merchant in those days required remittance of money from one place to another place while trading which is an important function of a bank.
In 19th century comes with the vast scope of development of commercial banking. Banking custom and tradition began before 8th century of Nepal. After 12th century, the goldsmith and other similar types of bankers used to collect the money and provide loan to the needy people.

Meaning and introduction of bank

An institution established by law which deals with money and credit is called bank. In common sense an institution in monetary transaction is called bank. Certainly, banks can be identified by the functions they perform in the economy. They involve in transferring funds from savers to borrowers and in paying for goods and services.
A bank is any business offering deposit subject to withdraw on demand and making loan of a commercial and business nature. Bank is a financial institution which deals with money. Bank collects the money from the savers and lends that money to the profitable sector. Banks raise the fund by accepting deposits, borrowing funds and issuing equity.
Bank means the Nepal Rastra Bank established under section 3 of this act. According to section 2(b) of the commercial bank act 2031(1974), “bank means a commercial bank established under this act”
According to commercial bank act 2031(Nepal), “bank is an organization established for the purpose of exchange money deposit lending money and participation in transaction.”
According to Shorter oxford Dictionary, “a bank is establishment for a custody of money received from or on behalf of it’s customer, it is essential duty is to pay their draft on it, it’s profit arise from it’s use of money left unemployed by them.”
According to G. Crothers, “the bankers business is to take the debt of other people to offer; his own in exchange and there by create money.”
In conclusion, bank is an institution which accepts the small saving of people providing specified interest rate and granting loan to people in different form against certain securities an charging them certain rate of interest.

Background of the field word
People are engage in different work and sector. People earn money from different sources and spend money in their daily use. People do not expand all money for consumption and keep for further. The remain money from consumption are saved and deposited in bank. Nabil bank is accepting the saving of people in our country since 12 July 1997AD. It has established it is branches in many district of our country which accept deposit from people and invest that amount to productive sector. The prosperity of bank is naturally positive impact on the economic development of the country. In present it has provided employment to more people in various offices. The Nabil bank Birtamode was establishes in the years 20.

Introduction to Nabil bank

Nepal Arab Bank Limited is the first bank established in joint investment in Nepal. The Nepal Arab Bank’s other name is Nabil Bank. Nabil bank limited commenced its operation in 12th July, 1984 as the first foreign joint venture bank in the country with the objective of extending international standard modern banking service to various sectors of the society.
Nabil bank is established with the permission of central bank ‘Nepal Rastra Bank’ where there is foreign investment in it. Persuading the core objective of Nabil bank brought about some major changes in the Nepalese banking sectors over last 23 years of its operation.
Modern banking system emerged in Nepal the share capital of Nabil at starting was 30,000,000 and profit up to 2066 fiscal years is 3,610,000,000 and market share is 46,310,000,000.
Among different commercial bank, Nabil bank is the commercial bank which collects money from general public and invests that amount to different productive sector. It not accepts deposit and provides loan but also transfer money from one place to another place or person has an agent. Nabil bank is the main agent of Western Union Money Transfer. Nabil bank is the expanding it’s branch according to need, want and market of people or public.

Head Office Branch
o Nabil House, Kamala, Kathmandu.

Other Branches
Birtamode Branch Office Anarmani, Jhapa
Damak Branch Office Damak, Jhapa.
Chandragadi Branch Office, Chandragadi, Jhapa
Biratnagar Branch Office , Biratnagar, Morang.
Itahari Branch Office, Itahari, Sunsari
Birgunj Branch Office, Birgunj, Parsa.
Dharan Branch Office, Dharan, Sunsari
Powher house Chowk Branch Office, Shreepur, Parsa.
Hetauda Branch Office, Hetauda, Makwanpur.
Kantipath Branch Office, Kantipath, Kathmandu.
New Road Branch Office, New Road, Kathmandu.
Jorpati Branch Office, Jorpati, Kathmandu.
Tripureshwar Branch Office, Trirpureshwasr, Kathmandu.
Maharajganj Branch Office, Maharajganj, Kathmandu.
Satahi Counter, Tribhuwan international airlines, kathnmandu.
Lalitpur Branch Office, Kupnadol, Lalitpur
New Baneshwasr Branch Office, New Baneshwar, Kathmandu.
Malchock Branch Office, Swayambhu, Kathmandu.
Thamel Branch Office, Thamel, Kathmandu.
Kaisaltar Branch Office, Kaisaltar, Bhaktapur.
Narayangad Branch Office, Narayangad, Chitwan.
Pokhara Branch Office, Pokhara, Kaski.
Lekside Branch Office, Pokhara, Kaski.
Baglung Branch Office, Mahendrapath, Baglung.
Butwal Branch Office, Butwal, Rupendehi.
Bhalbadi Branch Office, Dang.
Tulsipur Branch Office, Tulsipur, Dang.
Ghorahi Branch Office,
Bahirahaw Branch Office.
Nepalganj Branch Office.
Dhangadi Branch Office.
Mahendranagar Branch Office.

Name of Branches no. of branches

Head office 1
Branch ofiice 31

Location no. of branches

Kathmandu Valley 12
Out of Valley 20
Total 32

Purpose of study:

The purpose of this study is:
i. To find out the liquidity position of the bank.
ii. Market share position o f the bank.
iii. Facilities of bank.
iv. Total deposit of the bank.
v. To find out the service of the bank.
vi. Method of deposit collection.
vii. Remittance of the bank.
viii. Interest rate of the bank etc.

Statement of the problem:

The problem towards which this study is directed by today’s banking sector which is competitive. There are different bank established to provide service to customer and achieve, existence in the market and achieve the goals. High competition is the main problems of every bank. So due to high competition and better service some bank cannot compete with them and cannot exist in the market with good market share position and goodwill.
After the introduction of commercial bank act 2031, many commercial banks are opened in the joint investment. These banks are not free from problems. So problem arises due to :
i. Political influence upon bank.
ii. Banks not free from corruption.
iii. Lack of effective control and correct directors.
iv. Lack of investment in productive sector.
v. Centralization and urbanization of bank .
vi. Irregularity in distribution of loans.
vii. Traditional approach in services of bank.
viii. Lack of training and incentive for employee.
ix. Overstaffing .
x. To escape from social liabilities.


Significance / importance of the study

The bank is the strong means of the economic development of the country. The development of bank is interwoven with the development of the person, a society and a nation. It is impossible to fulfill the needs without the bank whether it is inside the nation or in foreign country whether it is industrial development of business and whether it is for the people or for the government.
In ancient time its necessity was realized but today it is consider to be much more necessary due to following reasons:
i. To relieve people from financial exploitation .
ii. To transfer fund.
iii. For economic development.
iv. To develop industry and commerce.
v. To provide security to valuable goods and property.
vi. To develop habit of saving.
vii. To create employment and skilled entrepreneurship
viii. To develop agricultural and backward areas.
ix. To balance economic development as a whole.
x. To provide loan at lower interest rate.
xi. To develop countries economy.
xii. To provide long term loan.
xiii. To provide employment.
xiv. For uplifting the poor people.
xv. To built capital.
xvi. Receiving deposit.
xvii. Granting loan.
xviii. Dealing of foreign exchange.
xix. Agency service.


Limitation of study:

The study is prepared to different activities of Nabil at birtamode branch i.e. direct relationship management (DRM) and deposit collection of the bank. This study mainly cover the Data of only the DRM and deposit collection is chosen, ignoring the other types of activities of bank. So, the study donot provide the overall activities of bank in detail but brief description is given.




Research methodology:-

While preparing report on any subject research is necessary for collecting data and information. So, method used for data collection while preparing this report is given below:
a)Field work:
It is the best source of gaining knowledge and practical study which help to collect quantum of accurate data. This is an analytical case study of current deposit collection of Nabil bank Limited, Birtamode branch. It shows the present situation of the current account of Btm. Branch whose objective is to know perfect current deposit of the branch.
b) Source of data:
This study is based on secondary data. The data are collected from the branch lie. The Nabil Bank’s necessary information are gather from
i. From marketing research.
ii. Personal talk with manager.
iii. From annual report of bank

Management of Nabil bank:-
Bank is being managed by highly qualified in their respective field in various departments, having the required technical and professional skills. The overall management of the branch is headed by the manager, having experience of successfully managing the organization. The promoter as well as the departmental managers of the company comprises various professional with suitable technical, educational and professional background in the management.

Types of deposit:-
The money which is saved by i.e. people, businessman, corporation etc. in saving a/c, fixed a/c, current a/c is called deposit. Accepting deposit is the main source of the bank and bank invest that amount to different productive sector. Among different function of bank accepting deposit is the main function.
There are mainly two types of deposit which are:
a) Fixed deposit:
The other name of fixed deposit is time deposit. The money deposited for certain period of time with a fixed rate of interest on deposit amount till the maturity date. Interest rate of fixed deposit is higher than other deposit a/c. which encourage customer to strengthen their deposit and get negotiated interest rate. Fixed deposit is the contract between and bankers. In this a/c money is refunded to customer after the maturity period and interest rate is higher with long time deposit. Fixed deposit a/c is opened like other current a/c and saving a/c but there are some limitation that a customer and banker should contract.
b) Saving a/c:
This a/c is opened by general savers. This a/c promotes saving which is generally opened by middle class people so they can collect money for future needs. This a/c has interest but not as much as fixed a/c. There are some rules and regulation of Nabil Bank while opening a/c. customer should fill up form and deposit minimum required balance, submit two recent photos, photocopy of citizenship, signature for literate and thumbprint for illiterate is required to verify cheque written by a/c holder in future. Bank provide voucher to a/c holder for deposit. After accepting the necessary document bank open the a/c and then cheque is provided to the a/c holder. After seven days ATM card is also provided to the a/c holder.
There are different types of saving a/c of the Nabil Bank which are :
a) Nari Bachat :
Nabil bank launched Nari Bachat for female which encourage saving money for future use.
Feature:
Minimum balance: - Rs.500
Interest rate: - 5% p.a. payable on monthly minimum balance
ATM charge: - Rs. 200
Cheque: - Free
Inward remittance :- Free
Facility:- 25% discount on travel cheque, gift voucher of Rs. 500.
b) Nabil Lok bachat:-
Lok bachat a/c is opened by general people who want to do transaction by ATM card.
Feature:
Minimum balance:- Rs. 0
Interest rate:- 2%
ATM charge :- Rs. 200
Inward remittance :- Free
c) Nabil Edusave :-
This a/c is only for student.
Minimum balance: - Rs.500
Interest rate: - 3.5% p.a.
ATM charge: - Rs. 200
Cheque: - Free
Inward remittance :- Free
d) Nabil bachat(normal saving):-
Minimum balance: - Rs.5000
Interest rate: - 3.% p.a.
ATM charge: - Rs. 200
Cheque: - Free
Inward remittance :- Free
e) Nabil Jestha bachat:-
This a/c is only for people who are above 50.
Minimum balance: - Rs.500
Interest rate: - 5% monthly.
ATM charge: - Rs. 200
Cheque: - Free
Inward remittance :- Free
f) Nabil bachat:-
This is special a/c of Nabil bank.
Minimum balance: - Rs.50000
Interest rate: - 6.5% p.a.
ATM charge: - Free
Cheque: - Free
Inward remittance :- Free
Facility:- ABBS free
g) Nabil bal bachat.
This a/c is for below 16 years.
Minimum balance: - Rs.500
Interest rate: - 3.5% p.a.
ATM charge: - Rs. 200
Cheque: - Free
Inward remittance :- Free


Chapter 2 SWOT Analysis

The overall evaluation of every company’s strength, weakness, opportunity and threats are called SWOT analysis. It is a way of internal and external environment of business.

External environment (opportunity and threats):-
A business unit must monitor key macro environmental forces and micro environmental factors that affects its ability to earn profit and goodwill. The business unit should set of marketing intelligence system to track trends and important development and any related opportunity and threats.

a) Opportunity:-
Today’s banking sector is highly competitive in the banking world. The wants and needs of customer are increased with the top competition. Banks are increasingly rapidly with new technology and strategy. To meet the technology and policy Nabil bank is also adopting new strategy. In market there are many opportunity to the people to get job. Right person at right time in right place should be selected.

b) Threats:-
An environmental threat is challenged posed by an unfavorable trend or development that would lead in absence of defensive marketing action to lower the profit. There are different trends of Nabil bank to face with that sort of trends which decrease the profit and goodwill of the bank. To compete with other bank and achieve the goal is one of he threat of Nabil. To face this threats cost of bank is increased.

Internal environment (strength and weakness):-
Each business needs to evaluate its internal environment.
a) Strength:-
Nabil is the first international joint venture bank of Nepal. The management is strong and it is dedicated to employee motivation. It provides many facilities to its staff and friendly environment which help to run the organization smoothly.
b) weakness:-
Every company has its weakness in some cases is the same way Nabil may have also some weakness. It has very low interest and expensive bank then that in comparison with other bank.

Chapter 3
Presentation and analysis of data:

Presentation:
The fieldwork was carried in the birtamode branch office of Nabil bank . Rules and regulation are varies with other commercial bank and even various branches of the same bank. The minimum amount of normal a/c is higher than birtamode in other bank i.e. biratnagar, Kathmandu etc. Customer should fill a forms, recent two passport size photos, photocopy of Nepalese citizenship of the a/c holder, signature for literate and thumbprint for illiterate in order to verify cheque written by a/c holder in future which secure the amount of a/c. while depositing money a/c holder should fill up the voucher and counter one folios for a/c holder as a proof that amount is received by bank.


Capital structure

supplementary capital and in total it stands at 11.10%.












There has been bullishness in the market price of the
bank’ shares. It is a matter of great pride that Nabil bank’s
share prices have persistently been rising. The current
market price of Nabil’s share is trading around at Rs 6000.
However, we feel the market’s expectations are on the
higher side.

Profit and loss a/c of increase/decrease in exchange
(01 shrawan 2065 to 31 ashad 2066)

Particular Current year Previous year
Difference in exchange rate 44,611,826/- 33,444,784/-
Foreigh currency exchange 207,307,886/- 163,042,631/-
Total profit(loss) 251,919,712/- 196,487,415/-

The difference in foreign exchange rate in this year 2066 is Rs. 44611826/- and 2065 is 33444784/- and the foreign currency exchange transaction for 2066 is Rs. 207307886/- and for 2065 is Rs. 163042631/-. The total profit on current year is Rs. 251919712/- and previous year is 196487415/-.

The bar diagram of the above transaction is below:


Chapter 3: Summary

Banks are essential elements for good acceleration of the economy of the country. It helps to pool small saving of public to big organization and re invest that amount to profitable and productive sector of the economy. Among different commercial banks Nabil bank is modern pioneering bank of Nepal. There are different branches of Nabil bank in all over the country which helps in different sector of national economy. Birtamode branch is smoothly functioning. Nabil bank is the third company to pay tax to government which improve government economy.


Conclusion:
Nabil bank is the very essential element for the economic development of developing country, Nepal. It has greatly collected the scattered money as saving of customer. It provide good and qualitative service to the people. Nabil bank has pooled a major portion of total saving of the locality. The deposit trend shows that Nabil bank limited should make effective plans for proper utilization of current amount. The branch can earn huge amount of money investing in productive sector with lower the risk and greater the profit. The liquidity position of Nabil bank limited is good and its management should keep it for long period.
Deposit is very profitable source of fund collection for Nabil bank limited branch. It should make important plans and investment to its fund. Remittance and interest of investment is the main income source of Nabil bank limited.

Recommendation and suggestion:

Although Nabil bank is smoothe and efficient bank which has its own rules and regulation with its own pattern of operating bank. Some recommendation are :
a. customers of current a/c can withdraw or deposit money as man times as they require birtamode should provide evening counter.
b. Today’s world is competitive, other banks are providing many service and customers are attracted to deposit in other banks. Nabil bank should provide more service and facilities with regards to other banks.
c. The a/c holder wants easy payments of credit cards, ATM cards, so Nabil bank also should meet the easy facility of today’s world.
d. Right person at right place according to capacity and qualification staff should be placed.
e. Staff should be trained and make them efficient as per their post in bank and provide effective as capacity.
f. Interest rate with compare to other bank is low so Nabil bank should raise the interest rate
g.
Bibliography

• Banking and Insurance “Dillli Raj Bhandari”
• Annual Report of NBL.
www.nabilbank.com


Abbreviation

A/c = Account.
ATM= Automated Teller Machine
ABBS= Any Branch Banking Service.
NBL= Nabil Bank Limited