main final

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CHAPTER ONE

INTRODUCTION

1.1 Background

Development of any nation is possible if there is optimal utilization of its resources. So,

the sound financial system of a country plays a major role in its development. Nepal is a

one of the Least Developed Country having more people under poverty line. Despite of

the poor performance in many sectors and political instability, Nepalese financial sector

is growing day by day in the form of commercial ban, co!operatives, finance companies,

etc. and is becoming one of the leading factors in the growth of the country"s

development by showing consistency in its growth and boosting economic factors such as

employment, capital ade#uacy, effective investment, efficiency in trade etc. $ecause of

this reason many of the Nepalese students are attracted to the study of $aning and

%inance.

$aning and %inance is a vast subject where each and every factor and activities

undertaen by the financial maret are carefully studied. %inancial maret comprises of

different inds of financial institution, and one of the major financial institutions infinancial sector is commercial ban. Commercial ban performs different ind of

financial activities, but basically it does the job of accepting saving and lending it or

investing savings in productive sectors.

&he volume of credit e'tension or credit lending of the ban largely depends upon its

capacity of collecting saving or deposit base. So, the deposit collection function

performed by the ban is very crucial tas, because it leads to capital formation, which in

return generates opportunities for effective investment and help in economic development

of the country.

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1.2 Study Background

&his project report is submitted in partial fulfillment of the organization for the degree of

)$achelors in $usiness *dministration+. t is an essential part of $$* program that helps

students to ac#uire professional #ualities through activities done under the supervision of

different professionals in the organizations. t gives tremendous opportunities to apply the

nowledge learnt in the classroom on real life industrial problem. Similarly this will

support students to ac#uire social, technical and communication sills to wors

effectively in the organization.

&he four year bachelors of business administration at Shaner Dev Campus, &ribhuvan

-niversity &-/ re#uire students to undergo an e'tensive internship program, in the last

semester, final year, for 0 wees in a business organization. &he internship program,

which the $$* students undertae, targets to provide the practical e'posure, to train and

prepare students for managerial functions to develop wor culture within them, to uplift

their interpersonal and communication sill encouraging them to interact with the people

in the organization.

&his report is mainly focused with the internship activities and the overall overview of

the subject matter that are being carried out by the internee at 1verest ban limited duringthe period of the 0 wees from 23 th4ay 53(( to 56th 7uly 53(( on the subject matter and

activities related with general baning.

1verest $an Limited"s major objective is to upgrade the country"s economy by

supporting the business areas. &he study is mainly focused on )Depo!t Sc"e#e o$

E%eret Bank &!#!ted'. CSD is one of the major functions of ban. * success of ban

largely depends on the satisfaction of the customers. t was a great opportunity to wor as

an intern in 1verest $an Limited, branch office, New 8oad. &his e'perience gave an

opportunity to gain practical e'perience about woring in an organization and utilize

conceptual nowledge in specific area of study.

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1.( O)*ect!%e

&he objective of the study is to e'plain the e'perience gained during the internship

period, to develop the conceptual and analytical nowledge about the baning sector in

Nepal. &he internship provides opportunity to gain practical e'perience on woring in an

organization and utilize conceptual nowledge in specific area of the study. &he main

objective of report, therefore, is to e'plain the major facts learnt during the internship

period. *t the same time it intends to highlight the problems and provide

recommendations for solving the problems faced by interns as well as the concerned

departments" staffs of the ban. $esides that, the following are other general objectives of

this study9

&o develop sill to maintain good customer relation

&o now procedures of Customer service department.

&o collect the e'perience of the woring environment of 1$L

&o gain practical nowledge of the baning activities in the Nepalese maret.

&o get ac#uainted with general baning activities

&o enable us to understand how theory nowledge differs from the practical life.

&hus, enabling us to understand the comple'ity and unforeseen nature of problem

and opportunity that e'ist in the country.

&o now about the deposit schemes of 1verest $an Limited

1.+ Scope o$ t"e tudy

nternship is a path that maes the student gain practical nowledge. *ll the theoretical

nowledge that has been previously studied is implemented practically. &he study serves

the greater importance to the students lie me because we get the actual practical

e'posure of organization functioning and is able to now how much the academicnowledge and principles are utilized in reality. &his helps to develop managerial sills as

well as gaining job e'perience which is one of the basic re#uirements in the recruitment

of new employees.

$esides this, internship is also helpful to the organization. :rganization can recruit the

employees by observing the wor of the intern on the basis of their wor sill and

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decision maing ability. &his doesn"t re#uire the evaluation of their academic

#ualification alone and later incurring significant costs to train them at their wors.

1., -et"odoogy1.,.1 Organ!/at!on eect!on

:rganization selection is a crucial factor in an internship program, because it is the place

where the internee gains nowledge of the practicality of what they study. selected

1verest $an Limited to do the internship because the organizational layout and setting is

very pleasing and tempting to wor. t has re#uired departments thus have huge

opportunities e'plore and learn about how different departments in a ban function and

wor.

%or selecting the organization, visited 1$L personally. &hen dropped a

recommendation letter from college along with a cover letter and a C; in human resource

department of 1$L. &here were other numerous applicants for internship. Since the

decision was not so easy, the ban re#uired few wees to decide. During this period

regularly followed up to the human resource department as was very much een in

doing my internship in 1$L. *fter two wees, was informed about the selection and

could start internship. %inally, joined the ban as an intern. During internship period

was placed at the New 8oad $ranch 5ndbig branch of 1$L/.

1ntering in real wor environment was really a scary one. *t first found it very

uncomfortable to step in that new environment as was not ac#uainted with it but with

the passage of time adapted in it as it was really interesting and the wor environment

was friendly enough.

1.,.2 Pace#ent

8egarding placement, internee was not placed in single department. nterns in 1$L are

rotated according to the re#uirements. &he main reason of the rotation was to let the

interns gain nowledge about the woring procedures and to let now the connections


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within the departments. &he support and cooperation that internee got in the ban was

instrumental. nternee was placed in9

Customer service department

Clearing department

8emittance department

Credit department

1.,.( Durat!on

&he duration of internship period defined by &ribhuvan -niversity is eight wees.

=owever, during the period of internship the placement on departments is fi'ed by the

ban itself but it is being divided in a nice manner such that it will be easy enough to

understand the wor environment.

Project Activity Week Number

1 2 3 4 5 6 7 8

Customer Service Department

Clearing Department

8emittance Department

Credit department

Ta)e 10 Repreent!ng no o$ eek and act!%!t!e per$or#ed

1.,.+ Act!%!t!e per$or#ed !n organ!/at!on

&he activities that performed in the ban are very useful to understand the woring

process in the ban and they are as follows9

Na#e o$ t"e depart#ent Type o$ act!%!t!e

Per$or#ed

(. Customer Service

Department

Dealing with customer.

>reparing che#ue boo.

>rinting statement.

&aing the forms for verification.

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:utward bills collection :$C/.

Checing customer"s transaction and balance on re#uest.

nforming the customers if their pin code of *&4 card

has arrived. *ccepting different documents that arrive and entering

them in the register.

&aing the documents arrived to the concerned

department.

%iling the forms as per the name of the product.

Distribution of various forms such as of e!baning, S4S

baning, pay bill, etc.

=elping them to fill the form.

nforming Customer about different types of account and

other #ueries they have about the operation of ban.

5. Clearing Department :bserved inward clearing of che#ues.

:bserved outward clearing of che#ues.

:bserved &ransferring of swift transfer. >rinting reports of :$C.

Sending the che#ues to N8$.

nforming the customers if their che#ue has been returned

from N8$.

8ecording the details about the che#ue being returned and

the che#ue that is being returned to the customers.

>hotocopying.

%a'ing swift transfer messages to head office.

2. 8emittance Department :bserved the woring of remittance department.

%illing the debit voucher.

%a'ing swift transfer messages to head office.

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=elping the customers to fill in the forms of different

remit lie the form of western union, 1verest remit, etc.

;erifying the remitter, place from where money has been

received and issuing the voucher to draw money.

reparing $i.$i.Ni form no


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INTRODUCTION O4 INDUSTR5

2.1 Introduct!on o$ Bank!ng

$an is a financial institution that deals with monetary transactions. &he main function of

ban is accepting deposits and advancing loan. $an collects scattered money from

public in the form of deposit by providing them certain percent of interest and distributes

the accumulated fund to others, who are in need of money by charging certain percent of

interest, which is usually higher than the interest that it gives to the depositors. $an can

also be termed as an intermediary, which bridges the gap between the savers of fund and

users of fund. Nowadays, ban provides financial as well as non!financial services to its

customers. $an is associated directly and indirectly with all the people in day!to!day

transactions, so it is very important to now the precise meaning of $an. &he following

are the few definitions given by different authors9

Bank is an establishment for the custody of money received from or on behalf of its

customers its essential duty is to pay their draft on it, its profit arises from its use of the

money left unemployed by them.

T"e S"orter O6$ord Eng!" D!ct!onary

Bank is a financial institution, which provides financial services that may be in the

form of accepting deposits, advancing loan, providing necessary technical advices,

dealing over foreign currencies, remitting funds, etc.

Nepa Ratra Bank act 2772

2.1.1 E%out!on o$ Bank!ng Indutry

&he evolution of baning industry had started a long time bac, during ancient times.

&here was reference to the activities of the money messengers in the temple of 7erusalem

in the New &estament. n ancient Breece the famous temples of Delphi and :lympia

serve as the great depositors for people"s surplus funds and these were the centers of the

money lending transaction. &he history of baning is nearly as old as civilization. n the

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ancient 8ome and Breece, the practice of storing precious metals and coins at safe places

and loaning out money for public and private purpose on interest was prevalent. n

1ngland, baning had its origin with the London goldsmith who in the (Ath century

began to accept deposits from merchants and others for safe eeping of money and other

valuables.

2.1.2 Bank!ng Indutry !n Nepa

n the country, the development of baning is relatively recent. &he record of baning

system in Nepal gives detail account of mi'ture of slow and steady evolution in the

financial and global economy of Nepalese life. &he history of baning in Nepal can be

traced bac to 1899 A.D. when &ejarath *dda was established by the government to

provide credit facilities to general public. &hese unorganized institutions although #uite

underdeveloped could still mobilize funds from wide range of different sources. *lthough

the &ejarath *dda was established, it was not able to facilitate the growing trades with

&ibet and ndia. &hus a need for the establishment of a modern ban had become

essential to promote the trade of the nation. n the year 1:2( )&reaty of peace and

%riendship+ were concluded between the Bovernment of $ritain and Bovernment of

Nepal. *s per the treaty, Nepal could carry on import trade free of duty via ndia. n other

words, it meant that Nepal was going to diversify its foreign trade and for that the country

needed a modern ban. $ut it wasn"t till 1:( A.D. that the -dyog >arishad ndustrial

Development $oard/ was set up.

&hus, the )-dyog >arishad+ helped in opening new avenues for the advent of baning,

industry and commerce in Nepal and thus helped to enhance the economic status of the

country. * year after its formation, the -dyog >arishad formulated the company act and

the )Nepal $an *ct+ in 1:(9 A.D.which established the Nepal $an Ltd. with the

technical cooperation of the mperial $an of ndia, as the first commercial ban of

Nepal.

$efore (6? )Sadar 4uluihana *dda+ local treasury of the government/ issued

currency notes and the foreign e'change reserves of Nepal were maintained by 8eserve

$an of ndia. During that period the ndian currency along with Nepalese currency was


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circulating in the economy. &hus to manage the circulation of national currency and to

maintain e'change rate stability, there was an urgent need for the establishment of a

Central $an. n (6?, &he Nepal 8astriya $an *ct was formulated and Nepal 8astra

$an was established as a central ban on *pril 5?, (6?. t too over the functions of

4uluihana *dda )Bovernment &reasury+ and started issuing currency in (6 and

also thus relieved the various 4al *ddas 8evenue :ffices/ of their wor. &hus it helped

the government to perform treasury functions and stabilize the e'change rate. n Nepal,

the baning industry is divided into four groups, commercial ban, development ban,

financial institutions and micro credit. =ere, have focused on commercial ban.

2.2 Co##erc!a Bank

Commercial bans can be described as a type of financial intermediary. n the -S, the

term is used to refer to any baning organization or division that deals with the deposits

and loans of business organizations. &he term commercial ban is used to differentiate

these bans from investment bans, which are primarily engaged in the financial marets.

Commercial bans are also differentiated from retail bans that cater to individual clients

only.

n non 1nglish!speaing countries the term commercial ban is used interchangeably

with the term trading ban. Commercial bans play a number of roles in the financial

stability and cash flow of a countries private sector. &hey process payments through a

variety of means including telegraphic transfer, internet baning and electronic funds

transfers. Commercial bans issue ban checs and drafts, as well as accept money on

term deposits.

Commercial bans also act as moneylenders, by way of installment loans and overdrafts.

Loan options include secured loans, unsecured loans, and mortgage loans. * secured loan

is one where the borrower provides a certain property or asset as collateral against the

loan. &he main condition of these loans is that if the loan remains unpaid, the ban has

the right to use the property in any way they lie to realize the outstanding amount.

-nsecured loans have no collateral and therefore command higher interest rates. &here

are a variety of unsecured loans available today and these include credit cars, credit

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facilities such as a lines of credit, corporate bonds, and ban overdrafts. 4ortgage loans

that are provided by commercial bans are similar to secured loans but are used

specifically to buy real estate property for commercial purposes.

2.2 I#portance o$ co##erc!a )ank

&he bans play very important role for the economic development of the country. &he

importance can be e'amined as under9

(. Increae !n a%!ng0&he people deposit their savings into the bans and the ban pays

reasonable profit on these savings.

2. Increae !n !n%et#ent0 &he money which is collected by the ban is lent to

businessman and industrialist. &he increase in the investment increases the level of

employment.

(. Increae !n e#poy#ent0&he bans advance loan to the investors. *s a result the

industrial units are setup in different parts of the country. =ence the level of employment

is increased.

+. Tran$er o$ -oney9 @hen the people want to transfer their money from one place to

another place, they get travelers che#ue and the ban draft from the ban.

,. &oan to ;o%ern#ent. @hen the government needs funds to complete the public

wors programs, the bans provide loans to it.

9. Baanced de%eop#ent0@hen the bans provide loans to the less developed areas, thechances of progress and development are increased in the areas. $ans are bac bone for

the economic development of any country. * planned baning system is indispensable for

economic growth and development of the country

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2.( 4unct!on o$ Co##erc!a Bank

Commercial banEs function can be categorized into two types, they are9

1. Pr!#ary or Pr!nc!pa 4unct!on0

>rimary or principal function of commercial bans is of three types.

A< Acceptance o$ Depo!t

*n important function of commercial bans is to attract deposit from the public. &hose

people who have cash account and want their safety they deposit that amount of bans.

Commercial bans accept deposits every class and source and tae responsibility to repay

the deposit in the same currency whenever they are demanded by depositors.

B< &end!ng

*nother function of commercial bans is to mae loans and advance out of the deposit

receive in various forms. $an *pply the accumulated public deposits to productive uses

by way of loans and advances, overdraft and cash credits against approved securities.

C< In%et#ent

Now! a! days commercial bans are also involved in nvestment. Benerally investment

means long term and medium term investments.

2. Secondary or Anc!ary $unct!on0

Secondary or *ncillary functions are two types9

A. Agency Ser%!ce

(/ Collection and >ayment of Che#ues

5/ Standing nstruction

2/ *cting as correspondenceurchase and Sales of stocsF share!act as a baner to issue

B. -!ceaneou or ;enera Ser%!ce0

(/ Safe Custody! bailee

5/ Locers!trustee

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2/ 8emittance facilities GDD, && etc

roviding Credit reports

?/ :pening LFC

A/ Demand in %oreign 1'changeF &ravelers Chec only *uthorized Dealer branches

0/ Complete service in %oreign &rade

/ :ther Services9 Debit Card, Credit Card, :n!line baning S4S baning

(3/ Creation of Credit9 a multiplier effect, Deposit creates credit and credit creates

deposits G derivative deposit.

$eside these activities, commercial ban may perform further tass all its activities are

guided by its authority for the betterment of the company or for society.

CHAPTER THREE

INTRODUCTION O4 THE OR;ANI=ATION

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(.1 E%eret Bank &!#!ted

. E%eret Bank &!#!ted1$L/ was established in(< (st Harti 536( $.S with a view

and objective of e'tending professionalized and efficient baning services to various

segments of the society.. &he ban is providing customer!friendly services through its

$ranch Networ. *ll the branches of the ban are connected through *nywhere $ranch

$aning System *$$S/, which enables customers for operational transactions.

&he ban is providing its services through a wide networ of


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(.( Corporate %!!on

1volve I position the ban as a progressive, cost effective I customer friendly

institution providing comprehensive financial and related services.

ntegrating frontiers of technology I servicing various segments of society.

Committed to e'cellence in serving the public I also e'celling in corporate

values.

(.+ Corporate #!!on

>rovide e'cellent professional services I improve its position as a leader in

the field of financial related services.

$uild I maintain a team motivated I committed worforce with high wor

ethos.

-se latest technology aided at customer satisfaction I act as an effective

catalyst for socio!economic developments.

(., Aard

&he ban has been conferred with )$an of the Jear 533?, Nepal+ by the baner,

a publication of financial times, London.

&he ban was bestowed with the )NCC 1'cellence award+ by Nepal ndia

chamber of commerce for its spectacular performance under finance sector.

(.Un!>ue Se!ng Propo!t!on Largest Networ artner providing &echnical Support.

8epresentative office in ndia to facilitate remittance from ndia.

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Board of Director

(Chairman)

Executive Director

DGM

(Marketing)

AGM

(Planning & Development)

Compan !ecretar AGM

("peration)

DGM

(Credit)

M#$ %D !ecurit Guard '$$reaur

"E* Dometic

+egal etail Corporate

econciliationinance, $ax, 'npection-

A,C- .B, Budget

Direct Drawing arrangement with >N$ and =D%C ban ndia whereby instant

payment is done on presentation of the instrument.

Direct account credit in >N$ branches connected with Central $aning System

4ore than(A3 remittance payout location in Nepal

Launching own 8emittance >roduct )1verest 8emit+ to enables remit income

from gulf country.

(. Board o$ D!rector0

&able 59 $oard of Directors

Board o$ D!rector De!gnat!on

1

.

-r. B.?. S"ret"a Chairman

2

.

-r. @ed ?. S"ret"a Director

(

.

-r. Arun -an S"ret"a Director

+

.

Dr. B.;. @a!dya Director

,

.

-r. ? Ra# -o"an Director

.

-r. P.?. -a"opatra Director

9

.

-r. -ukan S"ret"a Director

8

.

-r. S"!%a "aran ?.C Director

(.9 Organ!/at!ona c"art

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4!g10 Organ!/at!ona c"art o$ E%eret )ank &!#!ted

(.9 -anage#ent tea#

&able 29 4anagement team

Board o$ D!rector De!gnat!on1 -r. P.?. -a"opatra Chief e'ecutive officer

2 -r. H.P. ?ukarn! Deputy Beneral 4anager

( -r. .?.Arora Deputy Beneral 4anager

+ -r. Hu# Nat" ;urung Deputy Beneral 4anager

, -r. Pra#od Ra* S"ar#a Company Secretary

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(.11 Progre

$ased on the audited results for the financial year ending *sadh 53?0 1verest

$an"s net profit and operating profit are as under9

Ta)e +0 Net pro$!t and Operat!ng pro$!t

8s in crore/

*sadh 53?A *sadh 53?0

:perating profit (2S/ of the $an for the year is 8s.02.(0.

&he $oard meeting of the $an held on


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branches of the $an reached


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(.1+ Organ!/at!on tructure o$ EB&NR

4!g (0 Organ!/at!on tructure o$ EB&NR

Despite of the renovation of the baning the ban is smoothly running all of its

departments i.e. account opening, counter, clearing, account, credit and system.

CHAPTER 4OUR

ANA&5SIS O4 ACTI@ITIES DONE AND PROB&E- SO&@ED

+.1. Depo!t

Deposits are foundation upon which bans thrive and grow. &hey are uni#ue item on a

ban"s balance sheet that distinguishes it from other types of business firms. &he ability

of a ban"s management and staff to attract checing and savings account from business

53

Branc" -anager

Senior 4ana er

Operat!on Head

De ut 4ana er Cred!t "ead

*ssistant

Cred!t&C

AcBack O$$!ce CounterSyte#

Cear!n Teer Ca"Outard

Re#!ttance


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and consumers is an important measure of the ban"s acceptance by the public. Deposits

provide most of the raw materials for ban loan and, thus, represent the ultimate source

of ban profits and growth. Deposits generate cash reserves, and it is out of the e'cess

cash reserves a ban holds that new loans are created. mportant indicators of

management effectiveness in any ban are whether or not deposited funds have been

raised at the lowest possible cost and whether enough deposits are available to fund those

loans the ban wishes to mae.

&he ey issues that bans have to deal with to manage deposits are9

@here can the ban raise funds at the lowest possible costsM

=ow can management ensure that the ban always has an enough deposits to

support the desired volume of loans and other servicesM

nnovations in the form of new deposit plans, service delivery methods, and pricing

schemes, are rampant in baning today. $aners who fail to say abreast of changes in

their competitors" deposit pricing and mareting programs stand to lose both customers

and profit. *s a result of this today we can see lots of deposit schemes launched by every

ban today. ntroducing new deposit schemes to attract new customers have become a

trend today.

+.2. Type o$ Depo!t O$$ered )y )ank

&he number and range of deposits services offered by bans is impressive indeed and

often confusing for ban customers. =owever the basic types of deposits provided by the

commercial bans are9

De#and or Current Depo!t

&he organizations needing cash fre#uently deposit their money in current account, also

nown as demand deposit. &hey are among the most volatile and least predictable of

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ban"s sources of fund. &he amount deposited in this account can be withdrawn by

drawing che#ue without prior information. No interest is offered in this type of account.

&he ban can however tae incidental or ban charge for the management of the money.

&he minimum amount to be deposited and maintained in this account is stimulated. &he

amount varies from ban to ban. * passboo containing account and che#ue boo to

withdraw money are issued to depositors.

Sa%!ng Depo!t

&he low!income people and those not needing to draw money fre#uently deposit their

money in the saving account. &he money deposited in this account can be withdrawn a

limited time within a certain pre!specified period. &he amount is also stipulated. &he

minimum amount to be deposited and maintained is also pre!specified. &he amount varies

from ban to ban. &he passboo and che#ue boos are issued to depositors. 4ost ban

today issue financial statement on #uarterly basis instead of issuing passboo in both,

current and saving account.

&he ban provides interest in this type of account. &he bans are free to fi' the

interest rate themselves. Different forms of saving account are provided by the bans

today.

4!6ed or T!#e Depo!t

&he amount deposited for a fi'ed period is called fi'ed or time deposit. *s the main

implies, the amount deposited cannot be withdrawn before the e'piry of the fi'ed period.

=owever, the depositors can tae loan from the ban against the security of fi'ed deposit

receipt. &he interest rates charged on such loans are higher than offered by ban on the

deposits. Since the ban can utilize the money for a fi'ed period, high interest is offered

in this account.

:ne type of time deposit in use in present day is the Certificate of Deposit CD/. CDs are

evidences that a person or corporation has deposited a specified sum of money in a ban.

&he main difference between CD and time deposit is that the amount to be deposited in

time deposit is not stipulated by the ban. &he customer can deposit the amount as he

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wishes, but cannot withdraw until it matures. :n the other hand, it is compulsory to

deposit the amount stipulated by the ban in case of CD.

No che#ue boo and passboo is issued in this account. :nly fi'ed deposit receipt is

given as an evidence of deposit

Recurr!ng or Cu#uat!%e Depo!t

&he cumulative deposit is lie a saving deposit. n this account each month or after a

fi'ed interval of time, a fi'ed amount is deposited up to a fi'ed period. *fter e'piry of the

period the ban pays the lump sum amount. =ere the interest is given as in time deposit,

but interest is added in compound interest basis. &he ban gives permission if the

customer wants to close the account before maturity, but the interest rate offered may be

lower.

Ca Depo!t

Call deposit is a hybrid ind of deposit. t incorporates the feature of current and saving

deposit. >eople can withdraw at any time lie in current account and gains interest lie in

saving account. nterest is not defined beforehand but instead the interest rate is

negotiable. Depositors can withdraw the amount deposited with minimum balance but

should maintain the previous balance of deposit within certain days.

-arg!n Depo!t

4argin deposit is an interest free deposit. &he deposit for letter of credit, ban guarantee,

margin lending, safe deposit locer, etc. is margin deposit.

+.(. 4actor a$$ect!ng t"e !nteret rate

>eople deposit their money in different type of accounts offered by the ban. &he interest

rate is different for different inds of deposit. &he rate of interest on deposits depends on

following factors9

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-atur!ty o$ Depo!t0

n general, longer the maturity of the deposit the higher the interest rate that the ban

offers. t is because of the time value of money and fre#uent upward slope of the yield

curve. %or e'ample, the fund deposited in current account is subject to immediate

withdrawal by the customer, hence, no interest is offered. $ans offer lower interest rate

in saving deposit which is subject to withdrawal, but not fre#uently. $ans offer higher

interest rate on time deposits. 1ven interest on time deposits varies according to the

length of maturity of the deposit. %or e'ample, the deposit of more than two years carries

interest rate higher than that of one year deposit.

S!/e and Perce!%ed R!k E6poure

&he size and perceived ris e'posure of the ban may play a role in determining interest

rate. %or e'ample, bans in New Jor and London are able to offer lowest interest rate

due to their greater size and strength. :n the other hand, interest rate offered by other

bans is generally higher

-arket!ng P"!oop"y and ;oa

4areting philosophy and goals of the bans also influence interest rate. %or e'ample,

bans that compete for deposits offer higher interest rates to snatch depositors from their

competitors. n contrast, bans that want to discourage deposits offer lower interest rate

than their competing bans or financial institutions. &his is what is actually happening in

Nepal at present. $ans, in general, and joint venture bans, in particular, have been

offering all time low interest rate to discourage customers.

&!>u!d!ty Po!t!on

&he li#uidity position of bans also influences interest rate. @hen bans have higher

li#uidity and low demand for loans, and low investment opportunities, they offer low

interest rates to discourage deposits vice versa. *t present, bans in Nepal have e'cess

li#uidity due to high amount of remittance, reduction of compulsory reserve re#uirement

by N8$, flow of rural savings to urban areas and low demand for loans due to

unfavorable business environment. &hese factors have compelled bans to reduce the

deposit rates.

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+.+ Ca!$!cat!on o$ %ar!ou type o$ depo!t

1. Baed on Interet

a/ nterest bearing

8ecurring Deposit

Saving Deposit

%i'ed Deposit

Call Deposit

b/ Noninterest bearing

4argin Deposit

Current Deposit

2. Baed on Tranact!on

a/&ransacting

Demand Deposit

Call Deposit

Saving Deposit

8ecurring Deposit

b/ Non &ransaction

%i'ed Deposit

4argin Deposit

+.,. Depo!t Sc"e#e Pro%!ded )y E%eret Bank &!#!ted

n order to attract customer the ban adjust the types of deposits according to their

need and demand of the customer including various facilities and attractiveness in the

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deposit scheme which vary from ban to ban. So the deposit schemes provided by the

1verest $an Limited are as follows9

+.,.1 Current Account

1$L offers a wide range of products and services designed to mae baning easier and to

match each and every customerEs re#uirements. &his account is non!interest bearing

account.&here is no limit for withdrawal and deposit in this account. &here is provision of

internet user login for this account in case of single signatory.

1$LEs Current *ccount offers various benefits and fle'ibility.

%ree Che#ue boos

%ree monthly statement

-nlimited @ithdrawal

1'tended $aning =our

2?6 days baning

*ll the branches of 1$L are connected through *$$S *nywhere $an $ranch

Service/ which enables you to withdraw and deposit cash from any of the

branches.

*&4 cum Debit card in association with SC&.

Re>u!red docu#ent $or depo!t0

4inimum $alances for accounts may vary across branches. n terms of 1$LN8 the

minimum balance is 8s 633.

4or perona account0

Citizenship Certificate or >assport and 5 >> size photos.

4or Soe Propr!etor"!p0

8egistration Certificate

&a' Certificate

5?
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Citizenship Certificated >roprietor

5 >> size photos

4or Partner"!p Account0

>artnership *greement deed

%irm 8egistration Certificate

&a' Certificate

Citizenship Certificate of >artners

5 >> size photos of partners

&!#!ted Co#pany Account0


4emorandum I *rticles of *ssociation

Name, *ddress of directors I :ffice $earers of the Limited Company with copy

Citizenship Certificate

Name I Signatures of the >ersons *uthorized to :perate an account

:peration Commencement Certificate for >ublic Ltd. Co./

8esolution of $oard of Directors regarding opening I conduct of an account

&a' Certificate

+.,.2 Sa%!ng Account

1$L saving account is a deposit account held at a ban maintained by a customer for the

purpose of accumulating funds over a period of time while earning an interest. &he

purpose for this account is to be ept on deposit for a minimum length of time, while

others permit unlimited access to funds.

Saving account can be opened in N>8 and for the Nepalese citizen and -SD for

foreign citizens with valid password and job appointment letter.

5A


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Interet rate

nterest rateis calculated on Daily Closing balance and payable on #uarterly basis.

EB& Sa%!ng Account o$$er %ar!ou )ene$!t9 %ree che#ue boo

4inimum balance of N>8 633F! to open saving account in any branches

%ree statement on demand

-nlimited withdrawl

1vening counter facility

2?6 days baning


4inimum $alances for accounts N>8 633F!.

4or perona account0

Citizenship Certificate or >assport

5 >> size photos

+.,.( Sa%!ng Pre#!u# Account

-!n!#u# Baance

&he minimum balance re#uired for Saving >remium %und *ccounts shall be 8s. ( lac.

Interet

nterest is calculated on daily closing balance basis and paid half yearly.

Add!t!ona Bene$!t

ssuance of 1verest $an Saving >remium Card

1'clusive Service for the Saving %und >remium accounts holder.

No commission on Demand Draft up to Nrs. ( lac in a month.

No Security deposit for locer facility.

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29/44

*llotment of Safe Deposit Locers on priority basis subject to availability/. %or

small locers 63 discount and if it is not available (6 discount on other

locers.

>ersonal *ccidental Death nsurance for 8s. 2 lac

EB& Sa%!ng Pre#!u# Account o$$er you %ar!ou )ene$!t

%ree *&4 card

1'tended baning hours

-nlimited with drawl

*$$* facilities *nywhere $an $ranch Service/

2?6 days ban

%ree statement on demand


4or perona account0


5 >> size photos

+.,.+4!6ed Depo!t

1$L has introduced several innovative schemes under %i'ed Deposit designed to cater to

the needs of various segments of customers to meet specific re#uirement. :ne can open

fi'ed deposit from (6 days to 6 years. &he given interest rate remains unchanged during

the period of the deposit. * certificate of Deposit %D8/ is issued only for fi'ed deposits.

-!n!#u# Baance

N>89 (3,333.33 are re#uired for fi'ed deposit.

Interet Rate0

nterest is paid on #uarterly basis to the nominated account maintained at 1$L.


4or perona account0


5


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5 >> size photos



&a' Certificate


5 >> size photos




&a' Certificate



+.,., Sunauo B"a%!"ya 5o*ana

&o cater to people who have the habit to save in a regular basis and avail the bul sum at

the end with a high yielding interest rate the ban launched the recurring deposit. &he

deposit is targeted among the middle class families who save for specific purpose lie

purchase of items, marriage etc.

&his deposit goes on the policy that )1very drop counts+. :ne deposits certain amount of

their income in regular interval for certain period. :n maturity one gets the principal

amount i.e. the installment/ along with half yearly compounded interest.

Depo!t A#ount

4inimum amount for opening an account is 8s. (33.33 and amount can be deposited in

multiples of 8s (33. &he amount of installment need be fi'ed at the time of opening the

account.

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Per!od o$ Depo!t

(5 months to 2? months in multiples of (5 months.

-atur!ty @aue

>aid in lump sum at the time of maturity.

Pre#ature 3!t"draa

*llowed at ( lower interest rate than the published deposit rate for the deposited period

or prescribed rate @hichever is lower/.

&oan

Loan available upto 3 of the deposited amount at 5 higher rate than the published

deposit rate.


4or perona account0


5 >> size photo.

+.,. Naar! Bac"at ?"ata

@ith the objective to encourage the small saving of women household and professions

we have introduce Naari $achat Hhata. @here the customer can mae small saving and

get the higher interest rate.

T"e $ac!!ty o$$er !n t"! account ! a under

*ttractive interest 8ate on Daily $alance $asis

2(


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:pening of *ccount at N>8 6,333F! valley/ I N>8 5,633F! outside valley/

ssuance and renewal of Debit Card at N>863F!

ssuance of %ree Che#ue $oo

>ay $ill 8egistration %acility

56 discount on *nnual locer rent Small Locer :nly/ i $aning nternet $aning/ service facility

+.,.9 Saugat Bac"at ?"ata

Saugat Bac"at ?a"ta'is a uni#ue product, which has integration of both saving and

fi'ed deposit feature. &he ban introduced )Saughat $achat Hhata+ where the customer

will get interest rate on saving account varies from 2 p.a. to (3.33 p.a. depending on

time period. n this method we have two features in one saving account i.e. saving nature

and fi'ed account nature.

>roduct Nature 9 Composition of Saving I %i'ed Deposit

4inimum $alance 9 *ccount is opened at minimum balance of N>8 6333F!.

4eature o$ Product

&he ban would provide the facility of automatic transfer of balance from saving account

to %D8. n case the customer withdraws the amount from this account then it will be

treated as under

! %irst, the balance available upto 8s. 63,333F! in the account would be utilized! %or further needs, withdrawal will be allowed from %i'ed Deposit in the multiples of

8s. 56,333F! as per the re#uirement of the customer.

Interet rate o$$er

2 p.a. interest rate on Saving *ccount at the time of :pening

%rom 23 days to 3 days A.33 p.a. interest rate

%rom ( days to (A days 0.56 p.a. interest rate

%rom (03 days to 2?3 days (3.33 interest rate

Ot"er 4ac!!t!e

ssuance of Debit Card at concession rate of N>8 (33F!

%ree ssuance of Che#ue boo

%ree nternet baning

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4obile recharge and bill payment through S4S

7oint account facility

+.,.8 Ca" Cert!$!cate Sc"e#e

&his product is intended to cater to the demand of those depositors who want higher

return on small investments. &his is in fact a discounted value system, the maturity of

which has been fi'ed as the height of 4ount 1verest i.e. 00


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@ith the objective to mae the children"s future secure 1$L have introduce $aal $achat

Hhata where the parentsF guardian mae the saving in their children name and the ban

pays higher interest on this account.

*ttractive interest 8ate on Daily $alance $asis

:pening *ccount at N>8 6,333F! valley/ I N>8 5,633F! outside valley/

ssuance and renewal of Debit Card at N>8 63F!

ssuance of %ree Che#ue $oo

>arents will be the guardian of the account till the children will be major.

+.,.17 Supre#e Depo!t

1$L Supreme *ccount Scheme has offered its customer for higher interest rate in %i'edDeposit *ccount as well as =igher nterest rate on Saving *ccount. &he Customer who

open a fi'ed Depoit *ccount under Supreme *ccount are eligible to open a saving

account up to 6.63 p.a and the interest on saving account is calculate on daily closing

balance.

&he interest offered on Supreme %i'ed Deposit *ccount and Supreme Saving *ccount is

as under9

Ta)e 0 Interet Rate O$$ered !n Supre#e 4!6ed Depo!t Account

A#ount !n R.

Interet Rate !n F

1 year to )eo 2

year

2 year G

a)o%e

8s. (3.33 Lacs 0.33 0.56*bove (3.33 Lacs to 56.33

Lacs0.56 0.63

*bove 56.33 Lacs to 63.33

Lacs0.63 0.A6

*bove 56.33 Lacs to 63.33 .56 .63

2


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Lacs

*bove (33.33 Lacs .63 (3.33

Ta)e 90Interet Rate O$$ered !n Supre#e Sa%!ng Account

S.NA#ount In Supre#e

4D

Interet O$$er !n Supre#e Sa%!ng

Account

(.%D -p to 8s. 63.33

Lacs6.33 p.a.

5.%D *bove 8s. 63.33

Lacs6.63 p.a.

Che#ue boo and Debit Card is provided against Supreme Saving *ccount.

+.,.11 EB& NRN Depo!t

1$L welcomes you to open %oreign Currency Deposits. *s per the N8N"s ordinance

53?5 such deposits along with interest are fully repatriable.

Sa!ent 4eature o$ EB& NRN Depo!t Sc"e#e

*vail attractive interest rate on %oreign Currency along with additional 3.6 on N>8deposits.

3"o can open Non 8esident Nepalese N8N/ as defined in N8N ordinance

53?5, *rticle No. 5

3"ere *ll branches

Ho $y credit received in convertible foreign currency in our nostro

accounts as given overleaf

CurrencyO$$ered

-SD, B$> and 1uro

-!n!#u#

A#ount

(3,333 units in %oreign Currency

Type o$ Saving and &erm Deposit

26


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Depo!t

+.,.12 USD Account

&hose individuals and companies who earnF get funded in dollars can open -SD *ccount

at 1$L branches.


4or perona account0


5 >> size photos



&a' Certificate


5 >> size photos




&a' Certificate



2?


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+.,.1( Un$!6ed 4!6ed Depo!t Sc"e#e

-nfi'ed %i'ed Deposit Scheme allows benefits of higher term deposit rate with #uarterly

compounding interest while allowing facility of simultaneous overdraft against deposit.

Now you can use your money while earning interest on it.

Depo!t A#ount

4inimum 8s. 63,333F!

Per!od o$ Depo!t

? months upto 6 years

-atur!ty @aue

>rincipal *mount of deposit with upto date interest shall be paid on maturity date.


4or perona account


5 >> size photos

4or Soe Propr!etor"!p


&a' Certificate


5 >> size photos

4or Partner"!p Account


2A


38/44


&a' Certificate



+.,.1+ Cu#uat!%e Depo!t Sc"e#e

n case you re#uire bul amount in future to meet your financial needs lie childrenEs

higher education, their marriage etc. open an account under Cumulative Deposit Scheme

and earn higher term deposit interest on #uarterly compounding basis. 4ain features of

the scheme are as under9!

Depo!t A#ount

4inimum 8s. 6333F!

Per!od o$ Depo!t

? months upto 6 years

-atur!ty @aue

>rincipal amount of deposit with upto date interest shall be paid on maturity date.

O%erdue Depo!t

&he ban may at its discretion, allow interest on overdue deposit from the date of

maturity provided the deposit is renewed from the date of its maturity for at least (6 days

from the date of presentation.

&oano%erdra$t

*llowed at 5 over deposit rate.

%or further details contact the branch

&he account opening form can be collected from the branch or downloaded by clicing

here. &he duly filled account opening form along with the relevant document can be

submitted at the branch near you.

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4or perona account0


5 >> size photos

+. Strategy $or Depo!t Sc"e#e0

1verest $an limited is currently running in (A th year of its operation and with the

effective and efficient baning service such as different deposit schemes and retail

lending schemes it has attracted and maintained a lot of customers. *s per the ban, the

ban has sufficient number of customers having current, saving and fi'ed deposit

schemes. $ut the ban is planning to increase the number of saving deposit customer as ithas to pay less interest than that of the fi'ed deposit and can utilize the funds more

efficient in profitable sector than that of current deposit. %or this purpose the ban

influence its customer to open a saving account and any new customer who enter the

ban for in#uire the ban staff influences the customer by showing different attractive

feature of saving deposit.

*s the competition is growing between the bans, it is difficult to for the ban to

maintain and attract new customer. So the ban introduces different and new deposit

schemes. &herefore the ban doesn"t advertise the product in mass but advertises the

product inside the ban premises in an attractive manner so that it retains its customer

and also welcomes new customer.

+.9 Procedure o$ Open!ng t"e Depo!t Sc"e#e

&he first step is to as the customer to fill up the *ccount :pening %orm and the

Signature Specimen Card.

&he second step is to as the customer for the re#uired document and verify the

document.

&he third step is to provide the customer with hisF her account number which is in

the multiple of (3 and is obtained serially from the account opening register.

2


40/44

&he forth step is to enter all the information about the customer in the finacle

Software which is done in following manner.

%irst step is to define the account type, branch name and the account code of the

customer.

&hen a window appears where customer personal details such as name, address,

phone etc are entered.

n the same window by clicing the main code option the customer type details

such as Nepalese residence or citizen or individual, types of business etc are

entered and the account is created for 1!baning purpose.

+.84actorA$$ect!ngCuto#erC"o!ce$orBankDepo!t

+.8.1. Current Account

Location

*vailability of many other services

Safety

Low fee and low minimum balance

*&4F Credit Card facility

Che#ue boo availability *ny $ranch $aning Service *$$S/

Computerized

8emittance %acility

+.8.2. Sa%!ng Account

Credibility F %amiliarity

=igher interest rate

&ransactional Convenience

Location and any branch baning service *$$S/

*vailability of payroll deduction

%ee charges

*&4 F Debit F Credit Cards


41/44

4inimum balance

Computerized

Che#ue boo availability

No withdrawal limit

+.: Act!%!t!e done

&he activities that did in terms of different deposit schemes are as follows9

:pened different accounts on different schemes

*s the customers were unnown about different schemes gave them the

necessary information

Some of the customers were not able to understand, so helped them to fill up the

forms

Some of the customers were not able to now which one is favorable for them so

informed them which made them easier to recognize

CHAPTER 4I@E


42/44

CONC&USION AND &ESSON &EARNT

,.1. Concu!on

%rom the above analysis it is seemed that 1$L is one of most hard woring commercialban that is dedicated in serving their valued customers with e'cellence. 1$L is one

name that can really be trusted upon. n spite of the political insurgency going on in the

country the $an is able to result profit of 8s. (5A,600,2


43/44

can open account in Nepal from designated branches of >unjab National $an and remit

their saving economically through baning channels to Nepal.

&he whole internship period in 1$L was a great e'perience where the time was spent

serving the customer in CSD, clearing, 8emittance Department and Credit Department

where intern came up with new ideas and developed with sills to deal with the

customers, so far to cope with the real baning world situation. @oring at 1$L as an

intern was a great opportunity to develop conceptual and analytical nowledge about

baning sector in Nepal.

&herefore, conclude that the financial performance of 1$L seems pretty sound and

successful in the present conte't.

,.2 &eon &earnt

Hnowledge is nothing if can"t be applied in practice. &he 0 wees internship periods have

become a great e'perience and a fruitful one where intern obtained insights into career

opportunities through interaction, observation and wor e'perience in the organization. t

becomes a platform to be competent, confident and a silled professional in the near

future.

&he most important lesson that have learnt during my intern period is the corporate

woring environment, which is the basic lesson for my career development. $eside this,

have also learnt the woring of the general baning transaction process by being engaged

as intern in 1$LN8. During my intern period what felt is the importance of the time

management and the need of the communication sills. Since the customers are the main

drivers of any financial institutions, they should be pleased by offering the #uality

services which are basically depends on the #uic service and the pleasing personality of

the staffs because most of the services provided by different commercial bans are same

in nature and customers have different choices to mae in the maret.


44/44

During my intern period, observed that customers draw the image of the organization

from the behavior of the personnel, who have been attached to the organization in any

firm. So the misbehavior of any personnel adversely affects the organizational image.

n an organization, personnel"s despite being under wor pressure, lots of responsibility

and under rules and regulation, there develops certain socialize environment which attach

one another beyond the hierarchy level creating the environment more friendly and

affectionate. &he degree of socialize environment of any organization determines the

effectiveness and efficiency of any organization. So is the case of 1$L. &he friendly

environment, marvelous organizational culture and the efficient management are the

reason behind the success of this branch despite of the heavy worload.

@oring as an intern in different department at 1$L at New 8oad branch helped to learn

many things as9

&o implement the things that has been studied throughout the whole life into

practical use.

&o socialize with the people, staffs and the intern colleagues.

&o handle customer grievances and solve it out effectively.

&he specific abilities lie interpersonal sills, team wor, to be patience etc

were enhanced during the internship period.

Learned the process of account opening in the ban under different account

schemes.

New about the deposit schemes of 1verest $an Limited.

&o maintain and handle the files, documents which might be helpful in the

near future.

-sing different office e#uipments lie fa', photocopy, che#ue writer, printers

and scanning, etc

Learnt to prepare $i. $i. ni. form no < in credit department in LC section.

main final

Documents