Chapter 1
INTRODUCTION
1. Introduction of Bank
A. Origin and Meaning
of Bank:
Origin of Bank:
Various thinker and
economists have forwarded different ideas regarding the origin of banks. The
English word bank is said to have been originated from the Latin word 'Bancus' which means 'bench'. The
Italian gold smiths used to sit on benches to do their business of money
exchange and gold and silver trading during ancient times. The words for bench
were 'Banck' in German, 'Banca' in Italian and 'Banquee' in French, from which it was
used as 'Bank' in English language.
French writer Revilpot says “banks and currency notes were in
use even around 600 B.C. at Babylonia.”
Indigenous bankers and
moneylenders operated in India during the Vedic Period. Those were the earliest
forms of banking in the world.
Banking was
institutionalized as it passed through several developmental stages. The
earlier banks operated non‑individual level. The history of modern banks starts
from the establishment of the Bank of
Venice, established in Venice , in Italy Spain
in 1401 and Bank of Genoa was established in
1407 and Bank of Amsterdam Europe . By the century, almost all
the countries had their own banks.
Nepal Bank Limited was
established under the Nepal Bank Limited Act 1937. Nepal Rastra Bank, the
central bank of Nepal
Crowther describes Merchants, Moneylenders and
Goldsmiths as the three ancestors of modern banking as.
MERCHANTS:
Merchants were the first
ancestors of modern banks. In the beginning the merchants used to trade in gold
and silver coins, exchange foreign currencies, accepting the deposits of gold,
silver and other valuables to provide securities and issuance of receipt
letters etc. due to prestige and trust earned by the merchants, the receipts
issued by them were considered as good as paper currency notes. These letters
gave birth to modern negotiable instruments.
MONEY LENDERS:
Money lenders were the
second ancestors of modern banks. Earlier, men used to borrow money from others
for their personal use. The creditors used to give loans from their own
capital. Gradually people started depositing their own money with the
moneylenders for security as well as earning interest on their idle money with
the moneylenders. This will lead to an expansion in the work‑field of these
moneylenders. The main occupation of became to accept deposits and give away
loans. The relatives and family members of experienced and qualified
moneylenders took up this work,
GOLDSMITH:
The last ancestor of
modern banking constituted of goldsmiths. The profession of the goldsmiths
demanded the use of strong and reliable safes. The people would deposit their
money, gold, silver and other valuables with the goldsmiths. The goldsmiths
would issue receipts and charge some money as commission for providing security
to the valuables of the customers. Such deposits would be retained at demand.
Through experience, the goldsmiths learned that all the money deposited were
not demanded at once, hence, they started investing such money against security
deposits and also started paying some interest to the depositors. This led to a
great expansion of the work‑field of the goldsmiths. The receipts issued by
goldsmiths were transferred from one person to another and was used as a medium
of exchange of money. This custom is said to have led to the discovery and use
of paper currency notes. This way goldsmith started the functions of banks of
accepting deposits, giving loans and creating credits a very long time back.
Meaning of Bank:
Bank is the financial
institution that deals with the monetary transactions. It is the financial
institution with an aim to accumulate the idle money of the general public and
advancing to their profit sectors. In order to collect the money, banks offer
attractive rate of return for their savings. Bank then mobilizes their deposits
in providing loan facility to the general public, business houses, industries,
and agriculture and other needy sectors by charging some interest. In this way
the main objective of the bank is to mobilize idle resources in a productive
area after collecting from different scattered sources. Thus banks through
their operation act as a mediator between the saver and the investors and
generate profits for self-existence.
The functions of modern
banking system are multifarious in nature and owing to the shift in emphasis of
the functions of banks a different stage of development, different economists
have defined banking in different ways.
Economist Name
|
Definition
|
Prof. R. S. Syers
|
Bank is an institution whose debts
(bank deposits) are widely accepted in settlement of other peoples debts to
each other
|
Prof. Kinle
|
Bank is an establishment which makes
to individual such as advances of money as may be required and safely made to
and to which individuals entrust money when not required by them for use.
|
Dr. H.L. Hart
|
provides a slightly different
definition when he says, "A banker is one who in the ordinary course of
his business, receives money which he pays by honoring ordinary course of his
business, receives money which he pays by honoring
|
Geoffrey Crowther
|
Bank is an establishment which makes
to individual such as advances of money as may be required and safely made to
and to which individuals entrust money when not required by them for use
|
All the above economists
have concentrated on one or a few functions of banks. Banks, as such, can be
described early and briefly as institutions which dear in money and credit.
Thus, banks are those
institutions whose functions are related with; creation of money and credit,
acceptance of deposits from the people, forwarding of loans, transfer of money,
and agency functions to customers, etc. The
exclusive functions of banks of creation of credit have earned them the title
of 'Factories of Credit.'
B.Historical
Development of Banking in Nepal:
As in other countries of
the world, goldsmiths and landlords were the ancient bankers of Nepal. Though
"Tejarath Adda" carried out not all the banking activities
established during the tenure of the then Prime Minister Rannodip Singh in 1993
BS was the first step towards the institutional development of banking in
Nepal. "Tejerath Adda" did not collect deposits from the public but
gave loans to employees and public against bullion.
Banking in true sense of term started with the
inception of Nepal Bank Limited on 30th Kartik 1994 B.S. (1937 A.D.)
under Nepal Bank Act. Similarly to developed banking sector and to formulate
monetary policies, Nepal Rastra Bank was set up in 2013 B.S. (26th
help the government April 1956) under 1956 special act. Then the second
commercial bank of bank of Nepal kingdom of Nepal
In 2042 BS
government adopted liberal economic policy and allowed for the establishment of
joint venture banks under collaboration with different foreign banks. Following
are the joint venture banks, which are operating in the kingdom of Nepal
· Nepal
SBI Bank Ltd.
· Nepal
Arab Bank Ltd.
· Himalayan
Bank Ltd.
· Nepal
Bangladesh Bank Ltd.
· Nepal
Industrial & Commercial Bank Ltd.
· Bank
of Kathmandu Ltd.
· Everest
Bank Ltd.
· Kumari
Bank Ltd.
· Laxmi
Bank Ltd.
· Lumbini
Bank Ltd.
The
name of the three banks has been changed in the recent year. They are:
· Nepal Indosuez Bank Ltd. (Renamed
as Nepal Investment Bank Limited on 30th May 2002)
· Nepal Grindlays Bank Ltd (Renamed
as Standard Chartered Bank Limited on 13th July 2001
· Nepal Bank of Ceylon Ltd. (Renamed
as Nepal
C. Meaning of
Commercial Bank:
A commercial bank is a type of bank that provides services such as accepting deposits, making business loans, and offering basic investment products.Commercial bank can also refer to a bank or a division of a bank that mostly deals with deposits and loans from corporations or large businesses, as opposed to individual members of the public (retail banking).
In
the US the term commercial bank was often used to distinguish it from an investment
bank due to differences in bank regulation. After the great
depression, through the Glass–Steagall Act, the U.S.
Congress required that commercial banks only engage in banking activities,
whereas investment banks were limited to capital
markets activities. This separation was mostly repealed in the
1990s.
Functions of commercial banks:
Commercial banks
perform many functions. They satisfy the financial needs of the sectors such as
agriculture, industry, trade, communication, so they play very significant role
in a process of economic social needs. The functions performed by banks, since
recently, are becoming customer-centered and are widening their functions.
Generally, the functions of commercial banks are divided into two categories:
primary functions and the secondary fun
Primary Functions of Commercial Banks
Primary Functions of Commercial Banks
Commercial Banks performs various
primary functions some of them are given below
1.Accepting Deposits :
Commercial
bank accepts various types of deposits from public especially from its clients.
It includes saving account deposits, recurring account deposits, fixed
deposits, etc. These deposits are payable after a certain time period.
2.Making Advances :
The
commercial banks provide loans and advances of various forms. It includes an
over draft facility, cash credit, bill discounting, etc. They also give demand
and demand and term loans to all types of clients against proper security.
3.Credit creation :
It is
most significant function of the commercial banks. While sanctioning a loan to
a customer, a bank does not provide cash to the borrower Instead it opens a
deposit account from where the borrower can withdraw. In other words while
sanctioning a loan a bank automatically creates deposits. This is known as a
credit creation from commercial bank.
Secondary Functions of
Commercial Banks
Along with the primary functions each commercial bank
has to perform several secondary functions too. It includes many agency
functions or general utility functions. The secondary functions of commercial
banks can be divided into agency functions and utility functions.
Agency Functions : Various agency functions of commercial banks are
o
To
collect and clear cheque, dividends and interest warrant.
o
To
make payment of rent, insurance premium, etc.
o
To
deal in foreign exchange transactions.
o
To
purchase and sell securities.
o
To
act as trusty, attorney, correspondent and executor.
o
To
accept tax proceeds and tax returns.
General Utility Functions : The general utility functions of the commercial banks include
o
To
provide safety locker facility to customers.
o
To
provide money transfer facility.
o
To
issue traveller's cheque.
o
To
act as referees.
o
To
accept various bills for payment e.g phone bills, gas bills, water bills, etc.
o
To
provide merchant banking facility.
o
To
provide various cards such as credit cards, debit cards, Smart cards, etc
List
of commercial banks are shown on appendix 1:
C.Introduction of Nepal SBI Bank Ltd.
with its locations:
Nepal SBI Bank Ltd. is
an associate of State Bank of India
At the time of
establishment the authorized share capital of Nepal SBI Bank Ltd. was Rs.24crore
and paid‑up capital was Rs.12crore. Its share capital was divided as State Bank
of India
Nepal SBI Bank Ltd.
aspires to provide total customers satisfaction by constantly striving to meet
the changing banking needs wants and expectations ‑both explicit and implied,
of the customers. Nepal SBI Bank Ltd. strives to contribute to the betterment
of the country's economy by creating job opportunities and promoting the
development of the Nepalese entrepreneurial spirit both the nationally and
globally.
The core philosophy of NSBL:
Vision:
We desire to be “Banker to every Nepali”.
“My Nepal SBI Bank: My customer First,
My Nepal SBI Bank: First in customer
satisfaction”.
Slogan:
“Bisudha banking aru kehi hoina.”
Unique Selling Preposition:
The unique selling
preposition (USP) of Nepal SBI Bank is “indeed our people and we are also
committed to creating a compelling employee value preposition. We firmly
believe that our sustainability is depended on meeting our employees’
expectations in terms of leadership, remuneration, challenging, fair employment
practices, career development and sound industrial relations.”
Six
key areas of NSBL:
·
Caring
for customers’ involving needs and expectations by providing them with products
and services.
·
Creating
a great place to work.
·
Exemplary
governance and accountability.
·
Working
in harmony and in mutual satisfaction with our business partners.
·
Providing
returns in the investment of our owners.
·
Investing
in local communities in which we operate for the benefit of the society.
Nepal SBI Bank Ltd.
believes that in the active pursuance of it's cooperate mission. It has been
able to develop a distinct personality, which is by now well known in the
business as a market driven company that has distinctive features as follows.
•
Higher interest rates on deposits
•
A team of highly motivated, professional and trained staff
•
Customer‑friendly environment
•
A hassle free, computerized system
•
Greater flexibility in loan schemes
•
Convenient industrial loans
•
Personalized, efficient, prompt and courteous services
Nepal SBI Bank Ltd. performs banking functions
through institutionalized mobilization of savings and investment to promote the
economic interests of Nepalese people. It deposits the savings from Nepalese
people giving them interest as per the company. Those deposits are invested in
various profitable alternatives. Providing industry loan, trade loan, overdraft
loan, etc are the main investment. From this, Nepal SBI Bank Ltd. gets interest
higher than they do pay and commissions which is the main source of its income.
Nepal SBI Bank Ltd. having
such distinctive features is providing different types of services to the
public. That is the area of service activities, which are as follows:
1.
Collection of Deposit
2.
Trading and Commercial loan
3.
Industrial loan
4.
Overdraft loan facilities
5.
Opening letter of credit
6.
Loan on collateral
7.
Issue of bank guarantee
8.
Discounting bills of exchange
9.
Foreign exchange transaction
10.
Acting as an agent
11.
Accepting valuable material for safe custody.
12.
Providing safe deposit lockers
13.
Remittance of money
14.
Others
Location:
For
handling the growing business volume and also for providing required support to
the proposed branch expansion program of the bank, the total no of staff
(excluding three seconded staff) was enhanced during the year and reached the
level of 135 according to their annual report. Nepal SBI bank Ltd. is providing
prompt services to its customers by using advanced banking software name
"Bancs‑2000" It has extended its services in different part of the kingdom of Nepal Nepal
Region
|
Outlets
|
ATM
|
Eastern
|
14
|
12
|
Central
( |
30
(23) |
36
(28) |
Western
|
15
|
21
|
Mid-Western
|
04
|
03
|
Far-Western
|
03
|
03
|
Total
|
66
|
75
|
e.
Management, Capital and Ownership Structure:
Management:
To direct the
Name
|
Designation
|
Mrs. Hasana Sharma
|
Chairman
|
Mr. R. Karthikeyan
|
Director
|
Mr. Giridhara Kini
|
Director
|
Mr. Manoj K Agrawal
|
Director
|
Mr. Niranjan K Tibrewala
|
Director
|
Mr. Gokul Ram
Thapa
|
Professional Expert Director
|
Mr. Alok Kumar
Sharma
|
Managing Director
|
Capital and Ownership structure:
Capital Amount
|
|
1. Capital Structure of Year 2069/2070
|
|
Authorized Share Capital:
|
38%
|
30,000,000
Ordinary Shares of Rs. 100 each
|
3,000,000,000
|
Issued Share Capital:
|
31%
|
23,647,149.00 Ordinary Shares of Rs. 100 each
|
2,364,714,900
|
Paid-up Share Capital:
|
31%
|
23,557,385.04 Ordinary Share of Rs. 100 Each
|
2,355,738,504
|
2. Ownership Capital:
|
|
SBI Bank Ltd.
|
50%
|
Employment Provident Fund
|
15%
|
Agriculture Development Bank
|
5%
|
General Public
|
30%
|
f.Product and
Services offered:
Its
product and services are highlighted as under: ‑
Credit Card Facility:
Customers
can purchase the product in the shop and present their Credit Card instead of
money. It is used instead of money. A customer deposits certain amount of money
in the bank and the bank provides Credit card to their customer. For instance,
if a customer has deposited Rs.3, 00,000
and is provided a Credit Card
then he can make purchase by presenting that Card instead of money. When he
purchases the total amount of Rs.3,
00,000 then he cannot use that Card any more.
Indreni Bachat Yojana:
Under this scheme, any individual including
minor (account to be operated by guardian) can open the account. Customer will
get higher interest rate for maintaining higher balance in the account. The
interest is calculated on daily basis.
Features:
¨
Minimum
Balance: Rs. 10,000/- for interest calculation.
¨
Free
Cheque Book.
¨
Free
Internet Banking Service
¨
Any
Branch Banking Service free of charges
Automatic teller machine
(ATM):
Now a days bank allow
customer to deposit and draw money from their accounts through Automatic Teller
Machine. NSBL ATM gives a customer access to the convenience of 24 hour banking
in any of its 35 ATM locations nationwide plus more than 150 ATMs of national
financial institutions that are part of VISA network, plus over 16000 ATMs of
State Bank of India in India
Various
Loans and advances Schemes:
· Corporate and Business Loans:
The bank offers
loans to large corporate and institutional customers including public sector
entities to meet funding requirements from service related to strategic
expansions, project finance etc.
· Convenient Loan:
This is a loan
product designed to meet the needs of Small and Medium Sized Enterprises in a
very convenient manner to the borrowers.
·
Mortgage and
Mortgage Plus:
Both represent personal credits given to
individuals purely on the basis of their income level.
· Other Retail Loans:
Retails loans largely comprise of auto
finance, home loan and credit for consumer durables.
E-banking Facility:
For the comfort
and ease of valued customers NSBL provides E-banking facility “Nepal SBI Online
Bankin” with free of cost. E-banking can be operated by the account holder in
two different ways, which mu8st be mentioned earlier at the time of applying
request for e-banking facility. Transaction plus view and view only are the two
modes of e-banking facility which customers can choose as per their
requirement. Customer who do not have must time to visit the bank can operate
their account from the comfort of their home or offices.
Bharat Yatra Card (BYC):
BYC is a type of
ATM card provided by NSBL to its customers who want to make a visit to India.
Like any other ATM card BYC is a normal ATM card but provided only to those
customers who are travelling to India
Nepal SBI Remit:
Nepal SBI Remit:
Nepal SBI Remit is a customer focused Money Transfer product enabled by state of art web-based technology and is brought to you by Nepal SBI Bank Limited, a leading bank of Nepal. The Bank has a wide network covering all major cities, towns and villages of the country and is capable of paying at more than 56 branch locations across
Utility Bill Payment:
Customers—both accountholders and
non-accountholders—of the bank can pay bills of following services at the
bank’s branches free of charges:
·
NT
PSTN telephone,
·
NT
Postpaid mobile,
·
NT
ADSL Internet
Swarnim Bachat:
Under this scheme, any individual and institution can open the account. The interest is calculated on daily basis payable quarterly.
Features:
Under this scheme, any individual and institution can open the account. The interest is calculated on daily basis payable quarterly.
Features:
o
Minimum
Balance: Rs. 50,000/- for interest calculation.
o
Free
Cheque Book.
o
Free
Internet Banking Service.
o
Free
Any Branch Banking Service.
o
Free
issuance of Debit/ATM card and waiver of renewal charge.
o
Special
Discount on Remittance Charges.
Saluting your years of service to this great
nation and society, we have brought peerless banking account service to
you—Varistha Nagarik Bachat Khata. The respected senior citizen—aged 50 and
above—can open this Saving Account with minimum balance of Rs. 500/- only.
Additionally, the Accountholder gets bundle of additional benefits;
·
No
restrictions on withdrawal from account subject to maintenance of required minimum balance
·
50%
concessions on rental charges for hiring safe deposit locker (Subject to Availability)
·
50
% concession on SWIFT and RTGS only (Except on Exchange & Commission)
·
50
% concession on commission on Bharat Yatra Card
·
Free
Account Statement (On request)
·
Free
Any Branch Banking Service
·
Free
Nepal SBI Bank Debit Card
·
Free
Internet Banking Service
g.Organizational Structure:
An organizational
structure can be defined as the formal and informal framework of policies and
rules, within which an organization arranges its lines od authority and
communications, and allocates rights and duties.
Corporate Governance Structure
Compliance with
all applicable legislations, regulations, standards and codes is an essential
characteristic of organizational culture at Nepal SBI Bank. The Board of
Directors is the apex decision making body and has ultimate responsibility for
governance. The board monitors compliance with these means of management
reports, which include information on any significant interaction with all key
stakeholders.
Structure shown on appendix 2:
2.Introduction of the Subject (Deposit):
Development
of trade, commerce and industry are the requisite for the attainment of the
economic, social and political goals of any country, is based on
macroeconomics. To fulfill the purpose of planning, financial function more
often dominates the other function. But there is always lack of finance because
the national resources are not fully utilized for the productive purposes in
developing countries. In developing countries for rapid development of the
economy there should be proper mobilization of resources. Commercial banks play
very important role in mobilizing the resources in any developing country by
removing the habit of hoarding, developing the banking habit among the people,
collecting the small scattered resources in one bulk and utilizing the in
further productive purpose and, consumable and even to the need of the
government. Commercial banks credit in the desired sectors constituting the
significant part of the activities.
Now
a day, there are different commercial banks emerging to contribute in national
economy. The term commercial bank is used for those types of institutes, which
are mainly concerned for the development of trade, commerce and industry, which
are the prime requisites for the attainment of economic, social and political
purpose of the country. Financial services are fuel to provide energy to move
the vehicle of economic growth.
Thus,
commercial banks are the main institutions, which are meant for the collection
and utilizion of small‑scattered savings of the people. The commercial banks
utilize the collected resources by financing in productive, distributive the
main function of the banks is to accept money spread in the general public as
deposit and utilize the collected resources properly. General public deposits
their savings for safety and they also get interest in advancement. Not only
this, they can withdraw their money when they need. Deposit, is the savings of
people or even of industrialists, which in not required for them in the very
moment, which is accepted, by banks and later on they get interest.
Deposit
accounts are also one of the important sources of banks' funds, in order to
attract customers the banks offer attractive facilities to different types of deposits
account holders. In order to avoid miniature expenses of our daily life among
society banks has been providing sound interests because of the hard global
competition and they need deposits like raw materials in production process.
Banks
are providing different types of deposit account to the general public taking
consideration of their different financial status. Here are some deposits
accounts (concerned with my study), listed
below:
a) Saving Deposit Account
b) Current Deposit Account
c) Fixed Deposit Account
a.Saving Deposit
Account:
Depositors can deposit any amount of money in
their saving deposit account but there are certain restrictions in withdrawal
of money. If the depositor needs to withdraw a high amount, he is required to
inform the bank authorities in advance. If his withdrawal exceeds the specified
limit and does not even intimate the bank in advance, he will have to forgo his
interest earning for the concerned month. The depositor is given cheques
facility. Presently the rate of interest offered by commercial banks in Nepal
Procedure to open Saving
Deposit Account:
To open the Saving Deposit
Account a customer must fill the form provided by the Nepal SBI Bank Ltd.
including following details:
a.
Name
of the account to be opened. (i.e. Saving Deposit
Account)
b.
Full
name of the account opener.
c.
Status
of the account opener. (Individual, company, club, society,
partnership, others)
d. Mailing address of the account opener.
(Post box no., fax no., phone no.)
e.
Citizenship
or driving license number. (This is to be filled for the
individual account opener, in case of foreign nationalities passport number,
center of issue, date of issue, date of expiry and verification signature is
needed.
f.
Mode
of operation. (Single, former or survivor, both or survivor, either survivor,latter of survivor, others)
g.
Specimen
signature or signatures. (If a Partnership Company opens an
account or two or more person opens then all the partners should make specific
signatures.)
h. Name, address, account number and
signature of the introducer. (Rubberstamp if the
introducer is a company or an institution.)
Procedure to close Saving
Deposit Account:
Saving Deposit Account is
closed in the request of an account holder. To close this account, an account
holder must present a written application addressing to the Manager of the
Nepal SBI Bank Ltd. including following details:
a.
Full
Name of the account holder.
b.
Closing
charges. (To close this account closing charges Rs.300.00 is to be paid.)
c. Signature
of the account holder or holders. (Rubber‑stamp if the
account is of a company or an institution.)
b.Current Deposit Account:
Current
deposit account refers to such an account opened by the depositor in which he
can deposit any amount any time and also withdraw any amount any time as
required. The account holder can deposit and withdraw any amount of money at
one instance of in several installments. Such an account is very useful for
traders who require to deposit or withdraw money very frequently. Money in
current deposit account can be deposited for short period or long period
without any restriction. Due to the liquidity on the deposits provided by the
bank, generally very low or no interest is given to the depositor; In fact the
bank could be changing some incidental change from the customers for the
services rendered. The minimum amount of money required to open such an account
is other formalities to be fulfilled depend upon the rules and regulations of
individual requires even several times in one day through cheques. The current deposit account is also known
as 'Demand Deposit' or 'Demand Liabilities'
Procedure to open Current
Deposit Account:
To open the Current
Deposit Account a customer must fill the form provided by the Nepal SBI Bank
Ltd., this includes the following details:
a.
Name
of the account to be opened. (i.e. Current Deposit
Account)
b. Full
name, address, and occupation of the account opener. (Name
of the company or institution if an account is of any company or institution.)
c.
Status
of the account opener. (Individual, company, club, society, partnership,
others)
d.
Mailing
address of the account opener. (Post box no., fax no.,
phone no.,)
e. Citizenship
or driving license number. (This is to be filled for the
individual account opener, in case of foreign nationalities passport number,
center of issue, date of issue, date of expiry and verification signature is
needed.)
f. Mode
of operation. (Single, former or survivor, both or survivor, either of
survivor, latter of survivor, others)
g. Specimen
signature or signatures. (If a Partnership Company opens an
account or two or more person opens then all the partners should make specimen
signatures.)
h. Name, address, account number and
signature of the introducer. (Rubber stamp if the
introducer is a company or an institution.
Procedure to close current
Deposit Account:
Current
Deposit Account is closed in the request of an account holder. To close this
account, an account holder must present a written application addressing to the
Manager of the Nepal SBI Bank Ltd. including following details:
a.
Full
Name of the account holder. (Name of the company or
institution if an account is of any company or institution)
b.
Closing
charges. (To close this account closing charges Rs.300.00 is to be paid.)
c. Signature
of the account holder or holders. (Rubber‑stamp if the account
is of a company or an institution.)
c.Fixed Deposit
Account:
This account scheme allows a customer to earn higher rate of
interest for those amounts, which a customer is confident that he will not
require the amount for certain period. The scheme offers higher rate of
interest than savings account. The interest rates vary with the period for
which amount is kept in fixed deposit. The interest rates vary from time to time
Procedure to open fixed
Deposit Account:
To open the Fixed Deposit Account
a customer must fill the form provided by the Nepal SBI Bank Ltd., this
includes the following details:
i.
Name
of the account to be opened. (i.e. Fixed Deposit
Account)
j.
Full
name, address, and occupation of the account opener. (Name
of the company or institution if an account is of any company or institution.)
k. Status of the account opener. (Individual,
company, club, society, partnership, others)
l.
Mailing
address of the account opener. (Post box no., fax no.,
phone no.,)
m. Citizenship or driving license number.
(This is to be filled for the individual account opener, in
case of foreign nationalities passport number, center of issue, date of issue,
date of expiry and verification signature is needed.)
n. Mode of operation. (Single,
former or survivor, both or survivor, either of survivor, latter of survivor,
others)
o. Specimen signature or signatures. (If
a Partnership Company opens an account or two or more person opens then all the
partners should make specimen signatures.)
p. Name, address, account number and
signature of the introducer. (Rubber stamp if the
introducer is a company or an institution.
Procedure to close Fixed
Deposit Account:
Fixed
Deposit Account is closed after the maturity of the account. To close this
account, an account holder must present a written application addressing to the
Manager of the Nepal SBI Bank Ltd. including following details:
a.
Full
Name of the account holder, (Name of the company or
institution if an account is of any company or institution)
b. Account
number
c. Signature
of the account holder or holders. (Rubber‑stamp if the
account is of a company or an institution.)
3.Objective of the
study:
There
are serious handicaps in economic development, which arises from capital
deficiency. Under these circumstances banks and other financial institution can
play an important role and remove the difficulty of capital by stimulating
savings and investment. In Nepal
However, the main
objectives of the study are:
· To
show the trend of deposit position during the period 2064/65 BS to 2069/70 BS.
· To
show the trend of total deposit position during the period 2064/65 BS to 2069/70 B.S.
· To
understand account opening procedures at NSBL.
· To
get acquainted with performance of NSBL.
· To
know about the customer’s responses towards the services provided by the bank.
· To
study how customer service is handled by the bank.
· To
acquire the general idea on the software packages that the bank follows.
· To
develop interpersonal skills and the skills of networking in the real work
environment.
4.Significance of study:
Deposit collection is one
of the main problems of under‑developed county like Nepal. Due to various
difficulties or even ignorance of the people of under‑developed countries such
resources have not been utilized such as by hoarding. Hoarding, the bad habit
of the society, is one of the main problems. So, bank like Nepal SBI Bank Ltd.
plays vital role for accepting and, in turn, mobilizing the resources and
removing the habit of hoarding in pursue of rapid economic growth, and make
them habit of banking. The scattered resources are collected in one bulk and
mobilizing them in production purpose and even for providing other services to
its member and to the society. The main function of the Nepal SBI Bank Ltd is
to:
Accept the Deposit:
Deposits are the lifeblood
of the Nepal SBI Bank Ltd. as well as finance companies too. For that, Nepal
SBI Bank Ltd. accepts deposits and flows it in different sectors i.e. loans and
advances etc. But without utilizing the resources Nepal SBI Bank Ltd. could not
be able to repay the deposits including interest dividend to shareholders and
could not recover the operating expenses. Therefore, it should utilize the
deposits in proper way for maintaining the Nepal SBI Bank Ltd. entity and its
members' welfare. Before the mobilization of the deposits, there should be
deposit itself. Nepal SBI Bank Ltd. should collect the small‑scattered savings
as deposits first and get them ready for the mobilization. So, the study
focused on deposits only. Mainly, the study consists of deposits position and
briefs about its significant utilization and covers to the position and the
characteristics of such deposits which has been mobilized as loan and advances
and a glimpse of interest rates as the Nepal SBI Bank Ltd. is currently
providing to its depositors as well as the rates of interest take from the loan
and advances.
5.Limitation of the study:
The internship period was
completed gaining lots of knowledge and experiences but there were some
restrictions which somehow restricted or limited the comprehensive study. Those
limitations are listed below:
· Data
presentation is one of the most important factors in discussing the problem,
due to thedependency upon secondary data the problem cannot be expressed in
desired form.
· The data presentation of deposits is limited
to the period of 2064/65 BS to 2069/70 BS. Although, the study is made of Nepal SBI Bank Ltd., Bargachhi branch but
the data is presented from company annual report (study of the whole company).
· The
deep analysis could not be done due to time constraint.
Moreover, Nepal SBI Bank Ltd.
renders many services to its customers. However, the main service of them is to
accept deposits. Although, Nepal SBI Bank Ltd. is advancing many other
facilities to its customers and finally to the economy of the country, those
aspects are ignored due to the unavailability of the data, lack of time as well
as the confidentiality of the concerned institution and they may be broad
enough for this study. So, the case study is limited to deposits only and
excludes other aspects. Due to the cutthroat competition of banking in Nepal,
these days the officials' does not provide us the confidential.
Methodology:
A research methodology defines what the
activity of research is, how to proceed, how to measure progress, and what
constitutes success. It can be defined as “a particular procedure or set of
procedures”. The following methodology is used in this study and the
preperation of this project report.
6.1 Organization selection:
The
internship program has been made an essential part of academic program in BBA,
which aims to expose the students to business management sector as well as
industrial sector. It gives students opportunity to apply theoritical knowledge
they have gained so far into real, practical world. NSBL was selected for the internship
program as it is proved to be the good platform for career develpoment and
growth.
6.2 Placement:
The internee was
appointed and placed in the customer service department of NSBL Bargachhi
Branch, under the supervision of Operation Incharge Mr. Nishant Kumar Karn. The internee got an opportunity to learn a
lot about the acivities carried out in operation department in particularly the
customer service department. It was a great platform to familiarize oneself
with the corporate culture.
6.3
Duration:
The internee
completed eight weeks of Internship from 24.07.2014 to 24.09.2014 as the
partial fulfillment of requirement of Bachelor in Business Administration (BBA)
of Purbanchal University (PU). The whole internship peroid was spent on the CSD,
Remittance and cash departments of NSBL, Bargachhi branch and worked as a full
time internee.
Table#
1:
Details
of internship at NSBL
Address
|
Bargachhi
branch
|
Working
hour
|
10
am to 5 pm
|
Starting
week
|
24.07.2014
|
Ending
week
|
24.09.2014
|
Working
duration
|
8
weeks
|
Internship
supervisor
|
Mr.
Nishant Kumar Karn
|
Working
department
|
CSD
(6 weeks)
Remittance
department (1 week)
Cash
department (1 week)
|
6.4 Data collection:
As
we know that a lot of materials are needed in order to prepare this fieldwork,
the material which is important for my research work are collected from the
Nepal SBI Bank Ltd and been categorized them as primary and secondary data.
They are briefly discussed below:
Primary data:
As for primary data, I collected through:
· Direct
observation of working environment
· Interviews
with the staff of Branch Office Bargachhi and branch office of Biratnagar.
· Direct
interface with the walk-in customers.
Secondary
data
The sources of secondary
data collected are:
Internal sources:
a) Annual Report of the
Nepal SBI Bank Ltd.
b) Brochures of Nepal SBI Bank Ltd.
External sources:
a) Banking & financial
statistics of Nepal SBI Bank Ltd.
b)
Books
7. Organization of the study:
This study has
been organized into fie chapters. The contents of this chapter of this study
are briefly explained below:
Chapter one:
It deals with background, objectives,
methodology, selection, placement, duration, data collection, limitations and
organization of study.
Chapter
two:
It deals with:
a. Classification
& Tabulation of data:
After the
collecting the data they are classified and arranged in the tables with column and rows.
b.
Presentation
of data:
Various diagrams
like pie charts and bar diagrams have been used in this report, in order to present the given data clearly.
c.
Analysis
of data:
In order to analyze the
given data clearly, I have used many statistical tools such as Arithmetic Mean,
Standard Deviation and Coefficient of Variation to analyze the data.
After completion of the
above methods, I have done SWOT analysis in order to find out strength,
weakness opportunity threats analysis. Lastly summary and conclusion of the
study and recommendation are given.
Chapter
three:
It deals with
analysis of activities done.
Chapter
four:
It deals with lesson learnt, summary,
conclusion and recommendation and suggestion.
Chapter 2
PRESENTATION AND ANALYSIS OF DATA
1.Interpretation
& Analysis of Data
Deposits are one of the main sources for loans
and advances. In any country, in the case of bank the capital subscribed by the
owners tends to play a distinctly subordinate role. Bank are highly leveraged
institutions depend heavily on attracting spreader savings of general public as
deposits as a basis for their asset acquisition. Although, there is
considerable interest and invest it on various alternatives.
Likewise, Nepal SBI Bank
Ltd. also has to collect the deposits and invest in different sectors for the
fulfillment of the company's internal and external obligations and for the
economic development of the country. And for this, the most essential factor is
to gather and accept scattered savings of people as deposit first and utilize
it, the interest rate is another influence able factor.
Here is the total deposit
collection of Nepal SBI Bank Ltd. Corporate Office, Kathmandu
from the year 2064/65 BS to 2069/70 BS.
a. Current Deposit Account:
Its customers can open
this account by reserving minimum cash balance of Rs.10, 000.00 and can
withdraw and redeposit money at any time during banking hour. The account
holder doesn't earn interest. This facility is especially for the business
houses, government organization, etc.
Table # 2
Statement showing Deposit Position
In Current Deposit Account
From 2064/65 BS to 2069/70 BS
Fiscal Year
|
Collection
|
Total Balance
|
Deposit Increased/
Decreased
|
2064/2065
|
761682296
|
1199876179
|
323488413
|
2065/2066
|
1426373496
|
2626249675
|
664691200
|
2066/2067
|
951004571
|
3577254246
|
(475368925)
|
2067/2068
|
2359993191
|
5937247437
|
1408988620
|
2068/2069
|
1086697000
|
7023944437
|
(1273296000)
|
2069/2070
|
1300071000
|
8324015437
|
213374000
|
Source:
Company annual report
The above table‑1 & figure‑1 shows the Current Deposit Account of Nepal SBI Bank Ltd. Corporate Office,Kathmandu . During
the period, Nepal SBI Bank Ltd. has collected the total amount of Rs
8324015437.
The above table‑1 & figure‑1 shows the Current Deposit Account of Nepal SBI Bank Ltd. Corporate Office,
During
the year 2064/65 BS, the total collection was Rs.1199876179, which was
increased by Rs.664691200 in the year 2065/66 BS. Similarly, in the year
2065/66 BS, the total collection was decreased by Rs.475368925, which were,
increased by Rs1408988620 in the year 2067/68 BS and in the year the 2068/69 it
again decreased by 1273296000. Finally in the year 2069/70 it increases by
Rs.213374000 and the total balance were Rs.8324015437.
The
above data shows that the collection capacity was gearing up. In the year
2064/65 BS the total collection was Rs.1199876179, which were, increased
slightly in the year 2065/66 BS. After the year 2065/66 BS, the collection
capacity has increased nearly by double in the year 2065/66 BS.
b. Saving Deposit Account:
Nepal SBI Bank Ltd.
facilitates its customers by this account. Its customers can open this account
by reserving minimum cash balance of Rs.501.00
and can withdraw and redeposit money at any time during banking hour. Its customers
can have this facility for the unspecified period of time. The account holder
is paid interest for the balance amount at the rate of 2.25 % per annum (Effective from 14.11.2002). This facility is
especially for the individual person.
Table # 3
Statement showing Deposit Position
In Saving Deposit Account
From 2064/65 BS to 2069/70 BS
Fiscal Year
|
Collection
|
Total
Balance
|
Deposit
Increased/
Decreased
|
2064/2065
|
527237236
|
872860393
|
181614079
|
2065/2066
|
786711245
|
1659571638
|
259474009
|
2066/2067
|
902758609
|
2562330247
|
116047364
|
2067/2068
|
1060145989
|
3622476236
|
157387380
|
2068/2069
|
1274695000
|
4897171236
|
214549000
|
2069/2070
|
1633028000
|
6530199236
|
358332000
|
Source: Company annual report
During the year 2064/65
BS, the total amount deposited was Rs.872860393, which was increased by
Rs.259474009 in the year 2065/66 BS. Similarly, in the year 2066/67 BS, it was
increased by Rs.116047364. It was increased by Rs1157387380 in the year 2067/68
and further increased by Rs.214549000 in the year 2068/69 BS. Similarly it was
increased by Rs.358332000 in the year 2069/70.
The above data shows the
collection capacity of the Nepal SBI Bank Ltd. was in the increasing position.
In the year 2064/65 BS the total collection was Rs.872860393 and in the following
year in 2065/2066 B.S. it increased dramatically. But unfortunately, its
collection didn't rise in the next two years. Now, in 2067/68 BS, it shows
quite fruitful result in the collection.
c. Fixed Deposit Account:
Period
|
Interest rate
|
less than 3 months
|
2.50 %
|
less than 6 months
|
3.50 %
|
less than 1 year
|
4.50 %
|
less than 2 years
|
6.00 % per annum
|
less than 3 years
|
6.25 % per annum
|
3 years above
|
6.50% per annum
|
Nepal SBI Bank Ltd.
facilitates its customers by this account. This facility is especially for the
individual person. Customers can deposit money for a fixed period of time and
cannot withdraw before that certain time. They can deposit their money for
minimum period of less than 3month but regarding maximum period it has no limitation
and are paid interest by the Nepal SBI Bank Ltd. in the following rates
(Effective from 14. 11. 2002)
Table # 4
Statement showing deposit position
In Fixed Deposit Account
From 2064/65 BS to 2069/70 BS
Fiscal Year
|
Collection
|
Total
Balance
|
Deposit
Increased/
Decreased
|
2064/2065
|
2383622602
|
3916272287
|
850972917
|
2065/2066
|
2100218551
|
6016490838
|
-283404051
|
2066/2067
|
2420298451
|
8436789289
|
320079900
|
2067/2068
|
2929350603
|
11366139892
|
509052152
|
2068/2069
|
3132677000
|
14498816892
|
203327000
|
2069/2070
|
3337575000
|
17836391892
|
204898000
|
Source: Company annual report
The above table‑3 & figure‑3 shows the Fixed Deposit position of Nepal SBI Bank Ltd. Corporate Office,Kathmandu from 2064/65 BS to 2069/70
BS in Fixed Deposit Account. The total amount deposited is Rs.17836391892.
The above table‑3 & figure‑3 shows the Fixed Deposit position of Nepal SBI Bank Ltd. Corporate Office,
During the year 2064/65
BS, the deposited amount was Rs.3916272287, which was decreased by Rs.283404051
in the year 2065/66 BS. And again was increased by Rs.320079900 in the year
2066/67 BS. But there was inclination in deposit collection by Rs.509052152. in
the year 2067/68 BS. And in the year 2068/69 deposit amount was increased by
203327000. In comparison to the previous year, in 2067/68 BS deposit collection
has decreased. Similarly, in the year 2069/2070 deposited amount was increased
by 204898000, in comparison of previous year it has been increased.
The above data shows that
the amount of total collection is haphazard. The deposit collection in 2064/65
BS was Rs.2383622602. In the year 2065/66 BS the collection speed has
decreased. In comparison to 2064/2065 the collection speed was in top gear till
2067/2068. Showing fluctuation, the bank was not able to collect as much as
there was in the previous year.
d. Total Deposit Position:
Deposit is the soul of the
body of the body of Nepal SBI Bank Ltd. It accepts scattered savings of the
public as deposits, in turn, pays interest on deposits. It has facilitated its
different types of customers by different types of accounts ‑ Current Deposit Account, Saving Deposit
Account and Fixed Deposit Account.
From the above analysis, we
have observed that the Nepal SBI Bank Ltd. has become successful to collect
sufficient deposits from the public. It
has collected Rs.17836391892, in Fixed Deposit Account, Rs.8324015437in Current
Deposit Account and Rs.6530199236 in Saving Deposit Account. Its Grand Total
Deposit is Rs.2690606565. It is further explained in the table‑4 and figure‑4
& 5, which shows Total Deposit Position.
Table # 5
Statement showing Total Deposit
Position
From 2054/55 BS to 2059/60 BS
Fiscal Year
|
Total Deposit
|
Deposit Increased/Decreased
|
2064/2065
|
3672542134
|
1356075409
|
2065/2066
|
4313303292
|
640761158
|
2066/2067
|
4274061631
|
-39241661
|
2067/2068
|
6349489783
|
2075428152
|
2068/2069
|
5494069000
|
-855420000
|
2069/2070
|
6270674000
|
776604000
|
Source: Company annual report
Total Grand Deposit: 32690606565
Figure # 6
Pie chart showing trend of Total
Deposit Position
From 2064/65 BS to 2069/70 BS
The table‑4 and figure- 5
shows the Total Deposit Position for the period 2064/65 B.S to 2069/70 BS. The Grand Total Deposit was Rs.32690606565
In the year 2064/65 BS,
the total deposit was Rs.3616466725 that was increased by Rs.640761158 in the
year 2065/66 BS. Similarly, in the year 2066/67 BS, the total deposit was
decreased by Rs.39241611 that was further increased by Rs.2075428152 in the
year 2067/68 BS and was further decreased by 855420000 in the year 2068/69 BS.
In the year 2069/70 BS it will increased by Rs.776604000 and the Grand Total
Deposit was Rs.32690606565.
From the above data, it is
obvious the Nepal SBI Bank Ltd. was able to collect sufficient deposits from
the public. In the year 2064/65 BS the total deposit was Rs.24925863565. In the
year 2066/67 BS, and 2057/58 BS there was an increment in deposit. The total
deposit was only nearly double in the year.2067/68 BS in comparison to 2064/65
BS. In 2067/68 BS it slightly decreased.
Therefore, from the above
data, it is obvious that Nepal SBI Bank Ltd. has become successful in collecting
sufficient deposits from its customers as well as it shows the fluctuation
nature.
2. Mathematical
Analysis:
Computation of Mean of Current Deposit Account (CDA), Saving
Deposit Account (SDA) & Fixed Deposit Account (FDA): ‑
(Amount
in million)
Fiscal Year
|
X
(CDA)
|
Y
(SDA)
|
Z
(FDA)
|
dl=X-951
|
d2=Y-902.76
|
d3=Z-2420.29
|
2064/2065
|
761.68
|
527.24
|
2383.62
|
-189.32
|
-375.52
|
-36.67
|
2065/2066
|
1426.37
|
786.71
|
2100.22
|
475.47
|
-116.05
|
-320.07
|
2066/2067
|
951.00
|
902.76
|
2420.29
|
0
|
0
|
0
|
2067/2068
|
2359.99
|
1060.15
|
2929.35
|
1408.99
|
157.39
|
509.06
|
2068/2069
|
1086.69
|
1274.69
|
3132.67
|
135.69
|
371.93
|
712.38
|
2069/2070
|
1300.07
|
1633.03
|
3337.58
|
349.07
|
730.27
|
917.29
|
Total
|
Id1=2179.90
|
Id2=768.02
|
Id3=1781.99
|
|||
We
know,
Mean = A + Id
R (number
of fiscal year)
So, by using
formula we can calculate Mean of CDA, SDA and FDA
X (CDA) = 951+
2179.90= 521.82
6
Hence,
the Mean of CDA is 521.82
Y
(SDA) = 902.76+ 768.02 =
278.46
6
Hence,
the Mean of SDA is 278.46
Z (FDA) =2420.29+
1781.99 = 700.38
6
Hence,
the Mean of FDA is 700.38
Mean
is the sum of all the observations divided by the number of observations. The
mean of CDA is 521.82, SDA is 278.46
& FDA is 700.38. It is the average amount that the typical value around
which most of the data tends to cluster.
Computation of Standard Deviation of Current Deposit Account
(CDA), Saving Deposit Account (SDA) & Fixed Deposit Account (FDA): ‑
(Amount in million)
Fiscal Year
|
X
(CDA)
|
X-x
(X-951)
|
(X-x) 2
|
Y
(SDA)
|
Y-y
(Y-
902.76)
|
(Y-y) 2
|
Z
(FDA)
|
(Z-z)
(Z-2420.29)
|
(Z-z) 2
|
22064/2065
|
761.68
|
-189.32
|
35842.06
|
527.24
|
-375.52
|
141015.27
|
2383.62
|
-36.67
|
1344.69
|
2065/2066
|
1426.47
|
475.47
|
226071.72
|
786.71
|
-116.05
|
13467.60
|
2100.22
|
-320.07
|
102444.80
|
2 2066/2067
|
951.00
|
0
|
0
|
902.76
|
0
|
0
|
2420.29
|
0
|
0
|
2067/2068
|
2359.99
|
1408.99
|
1985252.82
|
1060.15
|
157.39
|
24771.61
|
2929.35
|
509.06
|
259142.08
|
2068/2069
|
1086.69
|
135.69
|
18411.78
|
1274.69
|
371.93
|
138331.92
|
3132.67
|
712.38
|
507485.26
|
2069/2070
|
1300.07
|
349.07
|
121849.86
|
1633.03
|
730.27
|
533294.27
|
3337.58
|
917.29
|
841420.94
|
Total
|
(X-x) 2
=2387428.25
|
(Y-y) 2
=850880.65
|
(Z-z) 2
=1711837.71
|
||||||
We
have,
Mean
(CDA) = 951
Mean
(SDA) = 902.76
Mean
(FDA) = 2420.29
Standard Deviation = (K-k)
2
N
So, by using formula we can calculate
standard deviation of CDA, SDA and FDA
(CDA)
2387428.25 = 630.80
6
Hence, the Standard Deviation of CDA is 630.80
(SDA)
850880.65
= 376.58
6
Hence, the Standard Deviation of SDA is 376.58
(FDA)
1711837.77 = 534.14
6
Hence,
the Standard Deviation of FDA is 534.14
Standard Deviation is
defined as the positive square root of the Mean of the square of the Deviation
taken from Arithmetic Mean. It is said to be the best measure of dispersion as
it satisfy most of the requisites of the good measure of dispersion. The
Standard Deviation of CDA is 630.80,
SDA is 376.58, and FDA is 534.14
Coefficient of Variation of Current
Deposit Account (CDA), Saving Deposit Account (SDA) & Fixed Deposit Account
(FDA): ‑
We
have,
A (CDA)
= 951 SD (CDA) = 630.80
A
(SDA) = 902.76 SD (SDA) = 376.58
A
(FDA) = 2420.29 SD (FDA) = 534.14
We
know,
Coefficient of Variation (CV= SD
* 100 %). so, by using Formula of Coefficient of Variation
X
We can calculate (CV) of CDA, SDA and FDA
CV (CDA) = 630.80 * 100 %
= 66.33%
951
Hence,
The Coefficient of Variation of the CDA is 66.30
%
CV
(SDA) = 376.58 * 100% =
41.71%
902.76
Hence
The Coefficient of Variation of the SDA is 41.71%
CV
(FDA) = 534.14 * 100 % = 22.07%
2420.29
Hence,
The Coefficient of Variation of the FDA is 22.07%
The Coefficient of
Variation of dispersion is based of Standard Deviation multiplied by 100 is
known as the Coefficient of Variation. It is an independent unit. So the
distribution can be better being compared with the help of Coefficient of
Variation of their variability. Less the Coefficient of Variation, more will be
the uniformity, consistency, etc and more the Coefficient of Variation less
will be the uniformity, consistency, etc. Here, the Coefficient of Variation of
CDA is 66.33 %, Coefficient of Variation of SDA is 41.71% and
Coefficient of Variation of FDA is 22.07%. The lowest Coefficient of
Variation is of FDA and highest is of CDA and FDA is in pendulum. Now it is
obvious, the FDA of Nepal SBI Bank Ltd. is more uniform and consistent than CDA
and SDA. CDA of Nepal SBI Bank Ltd. is less consistent and uniform than SDA and
FDA, SDA is pendulum in comparison with FDA and CDA.
3. SWOT Analysis:
Strength:
1) It has strong financial position due to high
deposit collection.
2) It has many branches in the kingdom on Nepal
3) Now has installed ATM machine in New Road
Branch.
5)
Any branch banking facility.
6)
The bank has its transaction with most of the bank of the world.
7)
It is located at the heart of the city where most of the business
transaction takes place.
8) Bank provides its services to most
of the large public institutions, corporate body, etc of the country.
9) Bank has installed SWIFT (Society
for Worldwide Inter bank Financial Telecommunication) facility in the bank with
a view to ensuring smooth and efficient transmission of financial message,
Weakness:
1) Low
deposit collection in Saving Deposit Account in comparison to other deposit
account.
2) Few
counters at the Newroad and Durbarmarg branches.
3) Still
lack of modern technologies. Such as ATM, Credit Card.
4) There
is no private parking in Biratnagar branches, which reflects the image of the
bank.
1) Employment opportunity due to increase in
number of branches.
2) Inward
& outward remittance facilities are also provided by the bank.
3) High
motivation through different rewards and prizes, yearly bonus, home loan etc.
4) Staffs
are trained by parent company SBI Bank Ltd. central office Mumbai India
Threats:
1) Cutthroat
competition in the market due to increasing numbers of commercial banks and
financial institutions in the country.
2) Small
market size is also one of the most serious factors which can reduce the
earning capacity of the banks.
3) Political
interference has been a constant factor in restricting many of the bank's
operation
4. Five Forces Model:
Porter's Five Forces is a framework for
industry analysis and business strategy development formed by Michael E. Porter
of Harvard Business School
Analysis of NSBL in relation to Five
Forces Model:
The banking
industry is very competitive as a number of commercial and development banks
are growing. The rivalry in banking sector is neck and there is cut throat
competition among the banks and bankers.
There are many ‘A’
class commercial banks in Nepal which gives cut throat competition to NSBL. The
main compititors of NSBL are ‘A’ class commercial banks and some well
established Development Banks. With the privatization in the banking sector
many new banks with modern technologies and competent human resource are coming
to the market which is a threat to NSBL.
With the many
banks in the industry delivering similar kinds of services to customers,
customers are being king of the market and fulfilling their expectation should
be the prime objectives of NSBL to retain existing customers and attract new
ones. Identifying potential customers and catering to their need to their level
of expectation should be main objectives of NSBL.
Substitute product
in case banking sector could be other financial institutions that provide
similar kind of services and facilities to customers. For NSBL threat from
substitute products could be those well established finance compies who offere
high interest to customers in deposits and lends high sum of amount by charging
comperatively low rate of interest.
The main
stakeholder of NSBL are government and Nepal Rastra Bank (NRB) who have keen
interest in the functioning of commercial banks. Government policies and rules
of Nepal Rastra Bank greatly affect the functioning of NSBL as it has to
operate accordingly with the directions given by NRB.
Chapter 3
Analysis of the
activities done
The
internship program proved to be a great learning experience. The internee was
provided with a full and realistic view of workplace culture by the employees
at operation and CSD, where the internee could get the opportunity to integrate
academic skills and knowledge in the practical and professional setting that
would help to cope up or deal with the professional challenges. Moreover
cooperation and proper assistance provided by the staffs in the operation and
customer service department is very much appreciable. In the existence of such
a good and helpful environment, knowledge could be gained to the fullest.
3.1 Activities done at NSBL:
Under
the supervision of operation in charge of NSBL following activities are carried
out during the whole internship program:
Table# 6
List of activities
performed
DEPARTMENTS
|
PERFORMED TASKS
|
CSD
|
Dealing with regular and new customers
of the bank.
Advise customers about NSBL Bank’s
products and services and respond their queries.
Providing different kinds of forms to
customer such as Account opening
form, Account closing form, Debit card application form, Internet banking
form, SMS banking form, etc.
Collecting necessary documents and checking forms of the
customers required for account opening procedures.
Filing application forms and writing different application on behalf of
customers on the request of customers.
Keeping record of the account opened, account closed,
transfer of the account, customer taking additional facilities such as
Internet banking, SMS banking, etc.
Providing ATM cards to the cardholders.
Providing the balance statement and balance certificate to
the demanding customers after verifying the account holder signature.
|
Remittance
|
Made payment to the customers receiving
money from various parts of the world through RTGS, SWIFT and Prabhu Money
Transfer.
Recording and filing of RTGS, SWIFT and
DD entries.
Helped customers to fill up various
kinds of forms.
|
Cash
|
Informing the client in case of cheque
return.
Cash sorting
Handling queries of the customer
regarding their cheques sent for clearing.
|
Brief discussion:
1.Account Opening:
Accounts
are opened in the form of personal and corporate account. The various forms of
personal account are saving account, current account and fixed deposit account.
Various schemes are available according to the saving need of the customers.
The
main duty of the internee in account opening was to provide customers with
proper set of account opening forms and give them proper information regarding
the documents that should presented and given by customer while opening an
account in the bank. Likewise, account opening forms submitted by customers
should be thoroughly checked so as all the necessary information are given and
they are correct.
2.Issue Cheque Book and ATM Cards:
NSBL
charge certain minimum fee on cheque book and ATM cards. When the account is
opened then the cheque book is prepared by the responsible staff and the cheque
book is normally issued after one day of opening of account. For the first time
cheque book is given only to the account holder but after that it can be
delivered to the authorized person by the account holder.
As
the ATM cards of NSBL come directly from India, it takes minimum 40 days to
deliver cards to the customer. Visa card is provided to the customer, which can
be used in any ATM machines. The ATM card is delivered to the account holder
only but in some special cases where the customer is not able to come to
receive the card he or she must fill the authorization form for giving
authority to other person to receive the card of account holder.
3.Issuance of Statement of Account:
Account
statements are the statement that shows the transactions done by the respective
account number in certain period of time. Customers come frequently to get the
account statement to know their remaining balances, their all deposits and
withdrawals. It helps them to analyze their withdrawals and deposits properly.
But there is limitation in giving the statement and that is statements can be
issued only up to last three and maximum six months upon the due request from
the customer. To get the account statement the customer must fill the statement
slip placed in the customer desk of the bank which includes the information
like account number, name of the account holder, signature of the account
holder, and time duration i.e. from when to which date to issue the statement.
In case if the customer want a more official statement of the account then
balance certificate is issued to them by charging them certain amount.
4.Maintaining Records and
Book-Keeping:
Various
records like ATM cards, e-banking, swift, UTL bill payment etc is maintained in
the bank by operation department. And, the whole work was assigned to the
internee during the internship period.
5.Signature Scanning:
As
signature of customer is very important and signature is the source of identity
of any customer, scanning of signature specimen cards should be done carefully.
The internee also assisted staffs in scanning the signature specimen cards.
3.2 Problems Identified in Customer Service Department:
During
the course of internship, the internee identified the following problems:
In the CSD no any staff
was available internee is taught at the first day of internship under the supervision of operation incharge and he/she
is responsible for carrying out all the activities from onwards. These
activities are account opening, handling customer queries, printing of account
statement, receiving cheques for clearing, various kinds of data entry and book
keeping, distribution of ATM cards, etc.
3.3 Problems Solved
in CSD:
During
the course of internship, the internee assisted in following ways:
1. The internee assisted in solving the customer queries and
helped customers to fill up account opening
forms.
2. The internee helped in printing out the account statement.
2. The internee helped in printing out the account statement.
3.The internee assisted in distributing ATM cards and cheque
books.
Chapter
4
LESSON LEARNT, SUMMARY AND
CONCLUSION AND RECOMMENDATION AND SUGGESTION
4.1 Lesson learnt:
The first and the most important thing learnt throughout the internship period were to deal with the real world situations and how to work and behave in the corporate
The first and the most important thing learnt throughout the internship period were to deal with the real world situations and how to work and behave in the corporate
Learnt about the corporate culture
The exposure to practical environment has increased the experiences of internee and confidence to tackle with the real world problems
Learnt how to behave with the seniors and colleagues and make good relationship with them. Learnt how to speak, function and work in corporate way.
Learnt a way to answer the queries of customers and provide them with best possible solutions.
Customer queries are needed to be answered in a friendly way
so as to retrain them in the organization.
Learnt the functioning of Customer Service Department.
Learnt account opening procedures.
Learnt basics about E-banking procedures.
Learnt reconciliation of ATM cards.
Summary and Conclusion:
An efficient bank can
contribute a great deal to nation's overall economic development through
efficient allocation of financial resources. It plays vital role in meeting
financial need of the people as well as country, which becomes more diverse and
complete as the economy develops. For the economic development without
inflationary pressure in the economy, mobilizations as well as canalization of
resources in the productive sectors are important but for this important fact
are that the deposit should be collected first. No doubt bank play a crucial
role for the economic development. These types of institution are most
important for accelerating economic growth in the country. It is quite true
that a strong banking institution is of great need for developing country like
ours because all the economic condition are based on the banking institution
and development of the country as well as general public depends upon the
active participation of the banking institution in the different activities in
the country.
This study confine to a
bank, 'Nepal SBI Bank Ltd'. In this study area, deposits of the general public
are the main resources of Nepal SBI Bank Ltd. funds. They are facilitating the
depositors by providing a bit higher rate of interest on deposits. In this
study, it was found that deposits are collected sufficient to fulfill their
internal and external obligations.
During the period Nepal
SBI Bank Ltd. has become able to collect Total amount of Rs.17836391892 in
Fixed Deposit Account, Rs.8324015437 in Current Deposit Account and
Rs.6530199236 in Saving Deposit Account. The above data shows that Fixed
Deposit Account is more than double of Current Deposit Account. It is obvious,
individual people like to deposit money for safety. On the other hand, it also
reflects that individual people are not interested to invest their money in any
productive sectors, they are idling their money. Similarly, in the Current
Deposit Account too, deposit is high which reflects the same not investing
habit of Nepalese people. Nepalese people are extremely interested to invest
money in jewelry, real state, etc. Due to such habit of Nepalese, investment
activities in productive sectors are not practiced as a result economy of Nepal
The basic purpose of the
fieldwork is to study the depository services provided by Nepal SBI Bank Ltd.
its position and interest rates. It has become successful in collecting
sufficient deposits from public by providing different types of deposit
accounts suitable for every type of customers. It is providing sound interest
so as to attract the customers. It has become successful in collecting huge
deposits in Current Deposit Account, Saving Deposit Account and Fixed Deposit
Account.
In the conclusion, we can
say that Nepal SBI Bank Ltd. has become successful in collecting sufficient
deposits.
4.3 Recommendation and
Suggestion:
During the visit to the
Nepal SBI Bank Ltd., it was exciting as well as interesting too. The staffs
were very kind, friendly and helpful. They proved themselves as a kind‑hearted
person by providing all the information and data, which are needed for my
research work without any hesitation.
Although the bank is
operating or functioning efficiently, the bank has to consider about certain
factors in order to function more efficiently and effectively to survive in
this competitive environment. Some of them are:
1. It should expand its branches in the remote areas, which will help
to mobilize internal savings of the country.
2.
It should use advanced technologies like ATM machines to
provide prompt services to the customers.
3. It should launch new products like Credit Card, facility so as
to attract new the customers.
4. It should try to increase deposit capacity in all the accounts
by providing different attractive prizes to the customer.
5.
It should provide prompt services by providing 24 hours
banking facility, more counters, less legal procedure for drawing loan.
6. It should provide 365‑day service from all its braches as
provided by the New Road
Lastly, Nepal SBI Bank
Ltd. should carry on with its quality services to the country with loyalty and
devotion. I wish for its bright future.
deposit analysis of nepal investment bank limited