AN INTERNSHIP REPORT

ON

PRABHU BANK LIMITED

SUBMITTED TO

APEX COLLEGE

POKHARA UNIVERSITY

INTERNSHIP MANAGEMENT TEAM

In partial fulfillment for the award of the degree

Of

BACHELOR OF BUSINESS ADMINSTRATION-BANKING AND INSURANCE

SUBMITTED BY

BANESHWOR, KATHMANDU

NOVEMBER, 2014

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 DECLARATION

I hereby declare that this internship report entitled “PRABHU BANK LIMITED” has been
carried out under the guidance of …………… and submitted to Pokhara University in partial
fulfillment of BB-BI degree.

I further declare that this project report is a result of my own efforts and that it has not been
submitted in part of or in full of to any other Universities or Institution for the award of any
degree.

.............................

Name: Diksha Bansal

Date: November, 2014

Place: Apex College

Regd No.: 2011-2-45-0455

Exam Roll No. : 12450431

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 ACKNOWLEDGEMENT

In the today rapid changing world, the financial sector plays an important role in the economic
development of the country, more in the context of developing nation. Hence I’m thankful to
Pokhara University for providing us the opportunity to allow us to perform a practical field work.

It’s my great pleasure to perform the practical activities in the Apex body of the financial
institution i.e. Prabhu Bank Limited. The completion of the internship and the report has been
possible only because of the appreciated support of many people. I benefited immeasurably from
their knowledge suggestion and feedback. I express my sincere gratitude to Mr. Pragyan Regmi,
bank manager for supervising me throughout my internship period.

I am very grateful to all the staffs of Prabhu bank, Kalimati who gave me their valuable time in
guiding me throughout the training period and helped me in preparing the final report.

My heartfelt thanks also go Mr. Govind Khannel, my advisor for providing me with continuous
support during the internship program and report writing.

I would like to appreciate and acknowledge my other faculty for providing me an opportunity
and also helping me in conducting a research and a field work at ‘Prabhu Bank Limited’ as
partial fulfillment of my BBABI program at Apex College. It was a great educational as well as
practical learning experience to conduct such research work.

Finally, I appreciate all of them who have become a part of this report. This page is dedicated to
those people who have contributed a lot in successfully completing the final report.

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 LIST OF ACRONYMS

ATM: Auto Teller Machine

NRB: Nepal Rastra Bank

NEPSE: Nepal Stock Exchange

CSD: Customers Service Department

SWIFT: Society for Worldwide Interbank Financial Transaction

POS: Point of Scale

SWOT: Strengths Weaknesses Opportunities Threats

PIN: Personal Identification Number

RRB: Rastriya Banijya Bank

ABBS: Any Branch Banking Service

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 CHAPTER I

INTRODUCTION

1.1 Background of the study

Apex College Pvt. Limited affiliated to Pokhara University have set up Internship Program under
which the students are required to involve in one of the business or any other organization as
interns and prepare internship report through the experience and research working there. This
report is a part of the undergraduate program under Pokhara University School of Business
which offers management internship to the students pursuing BBA-BI in the sixth semester. The
internship is an eight week program designed to provide students an opportunity for a
meaningful career-related experience in a real organizational setting before they graduate. It
gives the students an opportunity to practice and expand their skills and knowledge learned in the
classroom in substantive work situation and face organization problems. In addition, it will help
the students earn credit and increased marketability for the permanent job search while learning
more about a specific field and applying classroom knowledge in a corporate environment. This
internship program provides an opportunity to learn in the real work situation and an experience
which can help the students to achieve their goals.

I have chosen Prabhu Bank Limited for my internship as being a management student, extensive
knowledge of a financial intermediary is a must as it is the major mediator in the financial
market who works to provide financial services and ensure global outreach.

An internship consists of an exchange of services for experience between the student and an
organization. Students can also use an internship to determine if they have an interest in a
particular career, create a network of contacts, or gain school credit. Some interns find
permanent, paid employment with the organizations with which they interned. This can be a
significant benefit to the employer as experienced interns often need little or no training when
they begin regular employment. Unlike a trainee program, however, employment at the
completion of an internship is not guaranteed.

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This report is basically a Research internship (graduation) or dissertation internship, my purpose
being the fulfillment of university participation criteria as well as the need of organizational
exposure and acceptance. There is wider diversification in a commercial bank being a player of
financial market and an intern will not remain confined to a particular subject. Therefore
choosing a bank can be perceived as a wise decision as they can learn wider area under same
roof.

Prabhu Bank Limited is a financial intermediary who is primarily responsible for the transfer of
monetary resources from the net savers to the net users. It has head office at Anamnagar,
Kathmandu and corporate office at Kalimati, Kathmandu. This bank was chosen for the
internship purpose because it was founded by the key economic players of Nepal and also it is
one of the first class “A” commercial bank to have a successful merger with another class “A”
commercial bank. I had a keen interest on knowing how it worked from the very beginning of its
establishment. I wanted to learn how the different department worked and how the employees
communicated with the customers.

1.1.1 Objectives of the study

The major objective of internship program is to acquire learning as well as working experience
and gain practical exposure in the real-life working situation. The objective of the study is to
gather practical knowledge regarding banking system and its operations. Theoretical classes of
BBABI provide us theories regarding different subjects whereas practical orientation gives us the
chance to view those systems and their operations. More precisely we can identify the objectives
of this report as follows:

General objectives

 In partial fulfillment of university participation criteria in internship program.

Specific Objectives

 To be adapted to the real life working environment.

 Develop interpersonal and communicative skills.

 Develop appropriate skills and attitude.

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  To study, understand the functioning of the departments.

 To get practical exposure.

1.1.2 Limitation of the Study

There have been some limitations from which these report suffers. The limitations are briefly
pointed out below:

 Time is the first limitation as the duration of the program was of two months only.
 Another limitation of this report is Bank’s policy of not disclosing some data and
information for obvious reason, which could be very much useful.
 The data that seems insufficient may be suffering from lack of reliability to some
extent.
 Supply of more practical and contemporary data is another shortcoming.

1.2 Meaning of Bank

Bank is a financial institution which deals with the monetary transactions. The major function of
the bank is to accept deposits and providing loans. The bank attract deposits from various
investors by providing certain rate of interest, and investing the accumulated funds as loans to
others who are in need of fund by charging slightly higher rate of interest than they provide to
the depositors. Bank acts as an intermediary who bridges the gap between the savers of fund and
the users of fund. Basically, banks are those financial organization that offer the widest range of
financial services especially credit, saving and payment services and perform the widest range of
financial functions of any business firm in the economy.

Different scholars have defined bank in different ways. Some definitions of bank are as follows:

According to Walter Leaf, “Bank is that institution or individual who is always ready to serve
money on deposit to be returned against the check of their deposits (savers).”

A bank generates a profit from the differential between the level of interest it pays for deposits
and other sources of funds, and the level of interest it charges in its lending activities. This
difference is referred to as the spread between the cost of funds and the loan interest rate.

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Historically, profitability from lending activities has been cyclical and dependent on the needs
and strengths of loan customers. In recent history, investors have demanded a more stable
revenue stream and banks have therefore placed more emphasis on transaction fees, primarily
loan fees but also including service charges on an array of deposit activities and ancillary
services (international banking, foreign exchange, insurance, investments, wire transfers, etc.).
Lending activities, however, still provide the bulk of a commercial bank's income.

1.3 History of Bank

The banking industry that we have today is the outcome of a series of stepwise development that
have occurred in the process of its evolution. The banking sector went through the process of
evolution due to the unceasing demand for the improvements in service delivery and the
increasing need and expectations of customers as well the political reforms that have taken place
over the decades.

The early bankers are the Lombard who was originally from the plains of Lombardy of Northern
Italy. They introduced banking practice in England. These Lombard were eventually bankrupted
because they lent money to kings who did not repay them.

After the Lombard, the goldsmiths practiced banking as a sideline to their normal activities in the
bullion and jewelers fields. The early goldsmiths used to have large vaults, which were soundly
built and heavily guarded. The person who deposited his surplus funds with the goldsmith
became a 'depositor' and naturally paid for the privilege of having his money defended this way.
These payments were called 'Bank Charge'. The depositors who needed funds to pay wages or
debts, could call at the bank and collect such sums as required.

The very first banks were probably the religious temples of the ancient world where gold was
stored. Their owners justly felt that temples were the safest places to store their gold as they were
constantly attended, well built and were sacred, thus dissuading the would-be thieves. There are
existing records of loans from the 18th century BC in Babylon that were made by temple priests
to merchants. Ancient Greece holds further evidence of banking. Greek temples as well as
private and civic entities conducted financial transactions such as loans, deposits, currency
exchange, and validation of coinage. Interestingly, there is evidence too of credit, whereby in
return for a payment from a client, a money lender in one Greek port would write a credit note

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for the client who could “cash” the note in another city, saving the client the danger of carrying
coinage with him on his journey.

Ancient Rome perfected the administrative aspect of banking and saw greater regulation of
financial institution and financial practices. Charging interest on loans and paying interest on
deposits became more highly developed and competitive. The bank of Venice, established in
1157A.D is supposed to be the ancient bank. Originally, it was not a bank in real sense being
simply an office for the transfer of the public debt. Subsequently, Bank of Barcelona (1401) and
Bank of Geneva (1407) were established. The ‘Bank of England’, first English Bank, was
established in 1694 A.D. The ancestors of modern day banks have been attributed to the
merchants, the goldsmiths and the moneylenders.

1.4 Development of banking industry in Nepal

The history of banking in Nepal may be described as a component of gradual and ordinary
evolution in the financial and economic sphere in the Nepalese life. Even now the financial
system is still in the evolutionary phase. The establishment of “Kauai Toshi Khana” as a banking
agency during the time of King Prithvi Narayan Shah and “Tejarath Adda” can be regarded as
the initial steps in the direction of start of banking development in Nepal. In the context of
Nepal, the development of banks can be summarized in three phases:
Phase I: The establishment of ‘Tejrath Adda’ during the Tenure of Prime Minister Ranoddip
Singh in 1933 B.S. (1876A.D) was the first step towards the institutional development of
banking in Nepal. It was fully subscribed by the government in Kathmandu. Tejrath provided
credit loans to the general public at 5% interest rate on securities i.e. gold, silver and other
ornaments. Its objective was to provide credit or loans to the general public but it failed to accept
deposits from them.

Phase II: The modern banking in Nepal was started with the establishment of Nepal Bank Ltd.
In 1994 B.S., having felt the need of development of banking sector and to help the government
formulate monetary policies, Nepal Rastra Bank was set up in 2013 B. S. as the central bank of
Nepal. In B.S. 2022, Government set up Rastriya Banijya Bank as a fully government owned
commercial bank. The Agricultural Development Bank was established B.S. 2024. This bank

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was established with the objective of increasing the life standard of the people who are involved
in agriculture.

Phase III: To operate all commercial banks uniformly under single act, “Commercial Bank Act
2031” was enacted. In 2041 B.S, Nepal Government established five rural development banks
under the control and supervision of Nepal Rastra Bank. These banks include:

 Eastern Rural Development Bank

 Central Rural Development Bank

 Western Rural Development Bank

 Mid-western Rural Development Bank

 Far-western Rural Development Bank

1.5 Introduction of Prabhu Bank

Prabhu Bank Limited operated with a goal of becoming the best bank operational excellence and
superior financial performance. Prabhu Bank, a commercial bank formed through merger of Kist
Bank, Prabhu Bikas Bank, Gaurishankar Development Bank and Zenith Finance, started its
commercial operation from September 14, 2014. The four financial institutions started joint
operation based on final merger approval extended by Nepal Rastra Bank (Central Bank of
Nepal) in August.

It is public limited company incorporated under the Bank and Financial Institution Act, 2006 and
Companies Act, 2006. It is licensed under NRB to undertake the commercial banking services
and merchant banking activities in the country. The bank has a paid-up capital of Rupees 3.21
billion, is the sixth largest commercial bank in terms of capital. The bank’s capital base has gone
up following the merger. Its hold deposits of around Rs 32 billion and maintains credit portfolio
of Rs 23.78 billion. The shares of the bank are listed at Nepal Stock Exchange Limited (NEPSE),
the only exchange in the country, as ‘A’ category share.

It has 112 branch offices, 108 ATM kiosks, 631,000 clients and 1,135 staff members. It stands
for customer’s convenience and support. It is driven by values of efficiency in operation,
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integrity and a strong focus on catering the needs of every customer by offering high quality and
cost effective products and services. The professional management team along with dedicated
employees is always looking forward to serve the customers, understand their needs and design
tailored products. The bank operates in highly automated environment in terms of information
technologies and communication systems.

Thus, enabling prompt quality services it has put substantial efforts and investments in acquiring
the best technologies are available to build necessary banking infrastructures.

1.6 Mission/ Vision and Aims

Mission statement

Our mission is to become a leading bank by providing best quality financial products and
services to our customers, enhancing shareholders value, contributing to the economic prosperity
of the country and creating excellent growth opportunity for our employees.

Vision statement

Our vision is to become the best bank based on operational excellence and superior financial
performance.

Aims

Prabhu Bank was incorporated with the following main aims and objectives:

 Properly mobilizing the available talent, labor and capital for the establishment,
development, expansion and diversification of productive and employment oriented
business in the rural as well as cities and towns. Similarly, providing necessary financial
resources, technical and management consultancy, technology and training for the same
and thereby actively contributing towards the alleviation of poverty in the country are on
its list.
 Providing quality and reliable financial services to the general public by protecting the
rights and interest of the depositors and shareholders is another objective it carries.
Mobilizing the financial resources from company’s internal as well as from external

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 sources from the establishment. Development, expansion and diversification of
agriculture, industry, service, business and other commercially viable projects in the
country and thereby helping the economical development of the country. Acting as
financial resources spread all over the country and mobilizing the same for the economic
development of the country through fair competition. It also aims on providing
technologically innovative services to its customers.

1.7 Organizational strategies

Globalization of business is having significant impact on human resource management. In

information society, human resource is at the cutting edge, which shows that human resource
professionals are becoming much more important in the organization. Organization considers
human resource department as playing major role in staffing, training and helping manage the
people so that people and the organization are performing at maximum capability in highly
fulfilling manner. We believe that competent people can do miracles even with the small
resources and draw wealth out of barren land. We target to attack the most qualified employees
and match them to jobs foe which they are best suited for. Our effort is focused to enhance
morale and productivity, limit the job turnover, help the organization increase performance and
bring high level of professionalism in the organization. We indentify, assess and select
employees who embody high level of performance. One of the best and strongest aspects
considering our human resource management is our ‘work ethics’. Work ethics we believe is one
of the most important and must to workplace productivity. Considering the fact that work ethics
and attitude that employees bring to their job each day can affect a firms’ overall performance. It
provides a significant assistant for an organization to build up their store of hardworking,
effective employees even during the times of downs and difficulties. Thus, human resource
management is an integral part of the organization. We effectively use employees’ skills.
Moreover, to improve their skills, we provide training and development opportunities and
increase employees’ satisfaction with the jobs and work conditions. And, we make sure that our
employees are well guided, trained and polished to ensure the availability, retention and
utilization of a competent and willing workforce in the organization. And, as and, we also ensure
that we offer right mixture of rewards to attract and retain the targeted talents. We follow and
believe in recruiting and retaining those with the history of having good work beliefs principles

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and knowledge. Nurturing the kind of cultures that support behaviors that reflect hard work,
offering incentives that translate into superior work performance are important. Team work is
our motto and we aim to bring out the best of our employees and recognize and reward them for
what they deserve.

1.8 Major services provided by Prabhu

Deposits

Prabhu offers an array of deposit products which provides interest rates quite competitive among
the finance company of its class. Equipped with several distribution channels like cards, largest
Network of branches and ATMs and Extended banking hours, Prabhu offers its depositors the
freedom of 24hours a day, 365 days a year access to their deposit account.

Besides, the regular deposits accounts like current, savings and fixed term deposits, Prabhu also
offers many other special deposit schemes. Prabhu Khutruke Savings Scheme is introduced
mainly for small children and housewives. This saving scheme is intended to make the young
children be aware of saving from their early years. This saving scheme facilitates not only the
children but also housewives and low income earning group since this account can be operated
with minimal balance and regular small deposits.

ATM Card

Prabhu is providing self service banking to its esteem customers through VISA Debit Card with
collaboration with Smart Choice of Technologies. Customers can transact from the terminal on
free of cost. VISA Debit Card can also be used for shopping and countries like India and Bhutan.

Mobile Wallet Service

Prabhu Mobile Wallet service is an easy and handy method of doing banking transaction from
mobile phones without having to visit bank. Prabhu Bank customer needs to have Prabhu Mobile
Wallet application software installed in their mobile phones. Using such application of their
mobile phone, one can do various banking activities such as transaction, enquiry and request.

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E-Banking Service

Prabhu eBanking Services is an internet based Service offered by the Bank to its valued
customers. Prabhu eBanking, being an internet based service, is available anytime at customer’s
fingertip with the flexibility to take care of many financial transactions as well as viewing
account statements, requesting cheque books and many more.

Locker Facility
Prabhu also provides locker facility to its valued customers from its own Head office premises
situated in Anamnagar. Prabhu bank has arranged an advance security system for the security of
its customer’s valuables put on locker. Prabhu bank has also insured every locker.

Additional Services
For the Bank’s deposit relationships, there are other hosts of services available at Prabhu bank,
like implementing Standing instructions on accounts, issuing Balance Certificates, certifying
‘Good for Payment’ on cheques. The online connectivity of all our outlets makes it possible to
remit funds domestically to and from any of the branches located throughout the kingdom.
Lending

Prabhu, through its wide range of flexible products like Demand Loan, Time Loan and Short
Term Loan etc can accommodate all specific needs for the customers. Besides the regular
lending scheme Prabhu Bank also offers many other special deposit schemes.
Housing Loan

This loan makes the dream of owning a home a reality with attractive features available beyond
market offerings at competitive interest rates and extended loan tenure, with flexible repayment
and partial payment features.

Hire Purchase Loan

Prabhu Bank Hire Purchase loan makes commuting easier and owning a two or four wheeler in
reality at attractive interest rates, loan tenures and flexible repayment options with financing
available for large variety of vehicles, with special facilities to draw cash by pledging a vehicle
in the Bank’s name. Prabhu bank has designed a hire purchase loan scheme to finance the private
car or motorcycle to the professionals, self employed, business executives, and business houses

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and the transport like trucks, buses, minibuses, pickup vehicles, microbuses, etc. to the operators,
businessman, business houses, etc.

Education Loan

Prabhu’s education loan scheme provides loan for those students who demonstrate ability, drive
and ambition but do not have financial resources to achieve their goals.

Term Loan for Project Financing

Based on the viability of the project, Prabhu Bank provides term loan for project financing.
Before applying for loan the intended party must submit a proposal along with the feasibility
study report of the project. Financing will be made available.

Working Capital Loan

Based on the viability of the project and actual need of fund, Prabhu Bank provides working
capital loan in the form of overdraft. The intended business house should submit the proposal for
working capital loan. This loan will be granted based on the proposal and will take a form of
overdraft.

Consortium Loan

Due to the changing political situation and the expected peace in the country, we expect more
economic activities in the country. This will attract the large investment opportunities in the
different project. NRB has prescribed the maximum amount of funding to a single borrower to
minimize the concentration of funding. Therefore, single financial institution is not able to
finance the mega project alone. With our expertise, we are capable of arranging consortium
finance for such large projects.

Agriculture Loan

Based on the viability of the agriculture project/ proposal, Prabhu Bank provides Agriculture
Loan to finance the short/ long term financing need of client. This loan is also provided to
purchase tractor, seeds, fertilizers, insecticides, etc.

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Loan against Shares and Securities

The recent political development in the country has revived the hope for the economic
development and prosperity of the country. The NEPSE positively responded the recent
development and more activities and an upward trend is seen in the stock market. Those
investors not having fund in hand but wants to invest in stock market can apply for the loan
against shares and securities.

1.9 Functions of Prabhu Bank

Accepting Deposits

The most important function of Prabhu Bank is to accept deposits from the public. Various
sections of society, according to their needs and economic condition, deposit their savings with
the banks.
Therefore, keeping the needs and interests of various sections of society, banks formulate various
deposit schemes. Generally, there are three types of deposits which are as follows:
 Current Deposits

The depositors of such deposits can withdraw and deposit money whenever they desire.
Since banks have to keep the deposited amount of such accounts in cash always, they
carry either no interest or very low rate of interest. These deposits are called as Demand
Deposits because these can be demanded or withdrawn by the depositors at any time they
want. Such deposit accounts are highly useful for traders and big business firms because
they have to make payments and accept payments many times in a day.

 Fixed Deposit

These are the deposits which are deposited for a fixed period of time. This period is
generally not less than one year and, therefore, these are called as long term deposits.
These deposits cannot be withdrawn before the expiry of the stipulated time and,
therefore, these are also called as time deposits.
The interest rate on fixed deposits are generally high because banks can these deposits for
fixed period without having the fear of being withdrawn. If, withdrawn before the
maturity period bank charges certain amount.

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  Saving Deposit

In such deposits, money up to certain limit can be deposited and withdrawn. On such
deposits, the interest rate is very low. The main objective of saving deposit is to mobilize
small savings in the form of deposits. These deposits are generally done by salaried
people and the people who have fixed and less income.

Giving Loans

The second important function of commercial banks is to advance loans to its customers. Banks
charge interest from the borrowers and this is the main source of their income. Banks advance
loans not only on the basis of the deposits of the public rather they also advance loans on the
basis of depositing the money in the borrowers. In other words, they create loans out of deposits
and deposits out of loans. This is known as credit creation by commercial banks.

Modern banks give mostly secured loans for productive purposes. In other words, at the time of
advancing loans, they demand proper security or collateral. Generally, the value of security or
collateral is equal to the amount of loan. This is done mainly with a view to recover the loan
money by selling the security in the event of non-refundable of the loan. At times, banks give
loan on the basis of personal security also. Therefore, such loans are called as unsecured loan.
Banks generally give following types of loans and advances:

 Cash Credit

In this type of scheme, banks advance loans to its customers on the basis of bonds,
inventories and other approved securities. Under this scheme, banks enter into an
agreement with its customers to which money can be withdrawn many times during a
year. Under this set up banks open accounts of their customers and deposit the loan
money. With this type of loan, credit is created.

 Demand Loans

These are such loans that can be recalled on demand by the banks. The entire loan
amount is paid in lump sum by crediting it to the loan account of the borrower, and thus
entire loan becomes chargeable to interest with immediate effect.

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  Short Term loan

These loans may be given as personal loans, loans to finance working capital or as
priority sector advances. These are made against some security and entire loan amount is
transferred to the loan account of the borrower.

Over Draft

Banks advance loans to its customers up to a certain amount through overdrafts, if there are no
deposits in the current account. For this banks demands security from the customers in terms of
minimum balance and charge very high interest rate.

Discounting of Bills of Exchange

This is the most prevalent and important method of advancing loans to the traders for short term
purposes. Under this system, banks advance loans to the traders and business firms by
discounting their bills. In this way, businessmen get loans on the basis of their bills of exchange
before the maturity period.

Investment of Funds

The banks invest their surplus funds in three types of securities- Government securities, other
approved securities and other securities. Government securities include both, central and state
governments, such as treasury bills, national savings certificate etc. Other securities include
securities of state associated bodies like electricity boards, housing boards, debentures of Land
Development Banks units of UTI, shares of Regional Rural Banks etc.

Agency Functions

Banks function in the form of agents and representatives of their customers. Customers give their
consent for performing such functions. The important functions of these types are as follows:

(i) Banks collect cheques, drafts, bills of exchange and dividends of the shares for their
customers.
(ii) Banks make payment for their clients and times accept the bills of exchange of their
customers for which payment is made at the fixed time.

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 (iii) Banks pay insurance premium of their customers. Besides this, they also deposit loan
installments, income tax, interest etc. as per requested by the customer.
(iv) Banks purchase and sell securities, share and debentures on behalf of their customers.

Miscellaneous Function

Besides the functions mentioned above, banks perform many other functions of general utility
which are as follows:

(i) Banks provide locker facility to their customers for the safe custody of valuable assets
of their customers such as goal, silver, legal documents etc.
(ii) Banks collect necessary and useful statistics relating to trade and industry.
(iii) Banks give reference for their customers.
(iv) For facilitating foreign trade, banks undertake to sell and purchase foreign exchange.
(v) Banks advise their clients relating to investment decisions as specialist.
(vi) Banks issue letters of credit.
(vii) Bank does the under-writing of shares and debentures also.
(viii) During natural calamities, banks are highly useful in mobilizing funds and donations.
(ix) Banks provide loans for consumer durable like Car, Air-conditioner and Fridge etc.

1.10 Goals and Objectives of Internship

My internship program was conducted as a partial fulfillment of the Bachelor of Business
Administration-Banking and Insurance (BBABI) course under Pokhara University. The main
objective of this program is to gain experience in the banking sector of Nepal. Some points to
describe my individual objectives of the internship program are as follows:

 To learn how day to day operations of the bank are conducted.

 To understand the importance of all the departments in the accomplishment the ultimate
goal of the organization.
 To be able to relate the text book knowledge with the practical experience gained in the
workplace.

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  To be able to develop all the personal and professional skills required in the workplace.
 To apply theoretical knowledge in the real work environment.

I perceived this internship program as a great opportunity for a meaningful career related
experience. I considered it as a way for preparing myself to enter into job environment after
graduation. My primary goal of internship program was to able to apply theoretical knowledge in
the real world situation and to develop all the necessary skills to perform my job responsibly.

To achieve the goals and objectives of the internship program, I dedicated a lot of time and effort
in the learning new concepts and ideas from our mentors and supervisors.

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 CHAPTER II

REPORT ABOUT INTERNSHIP PROGRAM

2.1 Background of Internship

Internship is a period during which an individual works for an organization or a company in

order to get experience through direct involvement in daily activities of the organization. It gives
a valuable experience and a chance to get exposed to the business environment. Interns are
usually college or university students, but they can also be high school students or post graduate
adults seeking skills for a new career. Student internships provide opportunities for students to
gain experience in their field, determine if they have an interest in a particular career and create a
network of contacts. It provides real world experience. It is a system by which the students get an
opportunity to experience the real work environment through indulgence into the real task
accomplishment where one learns by doing things.

This internship program is designed by Pokhara University for the period of eight weeks
f o r   t h e   p a r t i a l fulfillment for the degree of BBA-BI. Being the student of BBA-BI program,
and specializing in Banking and Insurance, it was preferable to choose internship in the banking sector
to gain experience and practical knowledge about it.

I choose Prabhu Bank, Kalimati, to have a general idea about the banking activities. I got a
chance to put my theoretical knowledge to a practical know-how and internship program is all
about gaining a practical knowledge about the subject matter.

2.2 Internship Activities

Various roles/ jobs were assigned to me during the internship program. I completed my
internship program at Prabhu Bank working in various departments. A brief description on the
jobs performed by me in all these departments is as follows:

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Customer Service Department

In the customer service department, I was assigned with the following tasks:

 Statement handling and printing

 Account opening and closing
 Handling ATM cards
 Issuing of cheque book
 Handling e-banking facility

Remittance Department

Prabhu Bank Limited, operating under the guidelines set by The Government of Nepal and Nepal
Rastra Bank, offers one of the safest and the most secured means of money transfer to Nepal.
Remitters can send money to Prabhu bank from any part of the globe through our correspondent
banks, exchange houses and banks in the Middle East and using Himal Remit and Western
Union, our in-house remittance software.

SWIFT Transfer

Prabhu Bank offers fast and reliable money transfer services through SWIFT. Your bank account
with us can be credited with remittance from anywhere in the world. The remitter has to mention
the Prabhu bank’s SWIFT Address and the beneficiary details to transfer money to Nepal
through us. We cater the need of customers to remit fund from anywhere in the world,
denominated in major currencies, through SWIFT.

Demand Draft

We have draft drawing arrangement with our correspondent banks in different countries. Prabhu
honors bank drafts on/by various international banks denominated in currencies like US Dollar,
Euro, Great Britain Pound, Japanese Yen, etc.

2.3 SWOT Analysis

SWOT Analysis identifies and analyses the main internal and external factors that will influence
the future direction and success of a business. It comprises of strengths and weaknesses which

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are the internal factors and opportunities and threats which are the external factors that affect the
organization. Such analysis helps managers in strategic planning. SWOT analysis of Prabhu
Bank is as follows:

Strengths

 Good reputation in the budgeting industry.

 Dedicated, experienced and well trained employees.
 Up to date with the latest technology and information systems.
 Diversified product and services provided to customers.
 Proper links with the foreign banks.
 High capital base compared to other banks.
 Adequate number of branches all over Nepal.
 Well qualified and professional management team.
 Lower weighted average cost of deposit and higher interest rate of spread.

Weaknesses

 Inadequate marketing of its products and services.

 Need of effective manpower planning.
 Frequent problems in the ATM machines.
 Lack of quick customer response.
 The customer service department is not able to operate efficiently.

Opportunities

 It can take advantage of its good reputation and further expand its customer base.
 It can provide better training to their employees to be able to adapt themselves with the
new technology.
 Being technically ahead than the competitors can help Prabhu Bank to have an edge over
other banks.
 It can further increase its spread with the provision of new schemes.
 It can establish links with the foreign banks to provide extra facilities.

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  It can take advantage of its high capital base and provide loan in productive sectors.
 It can come up with new innovative products and services.
 Reduction in the necessity of lending to the priority sectors.
 The bank has an opportunity to invest various other areas of rural development and
hydroelectricity.

Threats

 Political problems ongoing in the country.

 Lack of stable government.
 Rapid increase in the number of commercial banks.
 Lack of attractive and profitable investments.
 International economic recession.
 Various rules and regulations imposed by the government/NRB.
 Unfavorable socio-economic condition of the country.
 Highly informed customers pose a challenge for the bank to provide better service.
 More competitive products being brought by other banks.
 Lack of effective manpower planning.

2.4 Problem Faced during Internship

While carrying out the task assigned by the supervisor, the intern faced different types of
problems. They are as follows:

 Though the instruction and required documents are clearly explained in the account opening
form, even then customers ask those for time to time and reasons for extra documents that are
already stated in back side of the form. So, it is tough to give them each guideline on filling
different types of form as well.
 The accountholder’s asked for the balance and cheque book without bringing the letter of
authority and citizenship with accountholder’s valid signature and account number.

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 Some the customer disagreed to accept the charges for account closing and make argument
on this matter for long time. So, it becomes difficult to convince them about the bank’s
charges.
 Customers argue for updating Know Your Customer (KYC) from especially to show original
citizenship.
 After merger customers argued about not giving the information of the merger to them where
the information was given to them about a month ago through notice, newspapers and media.
 After merger it was also difficult to handle the customers and explain about the changes in
the account number, banks policy, etc.

2.5 Problem Solved in Internship

During the internship period intern faced problem because intern was new to the organization.
The following are the problem solved during the internship period:

 Whenever the customers come up with their problem in CSD, intern is unaware about the
right and accurate information on the subject matter. So intern has to consult with their
senior staff to give the information to customers.
 Sometimes intern may give wrong information to the client due to lack of knowledge of
that department in the beginning. At that time, staff immediately correct our mistake and
give the right information.

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 CHAPTER III

SUMMARY AND CONCLUSION

3.1 Summary
Nepal being and under privileged country and more than ninety percent of people being
dependent upon agriculture, which sector is unable to provide full employment to the people.
HMG has to activate people in the nation’s development through overall industrialization of
nation. For which development of sound banking system is necessary.

Modern commercial banks make the economy always alive and smart to run and maintain day to
day commercial, economical and banking transactions. In short, banking transactions helps a
country to develop its economy swiftly.

At present commercial banks include joint venture banks are operating in Nepalese Banking
Industries. It is remarkable fact that any country cannot have a developed economy in the
absence of modern banking system. As any development, work needs a sufficient amount of
capital and the lack of sufficient capital is also one of the main reasons as Nepal has been
backward in developing its economy.

Therefore, it is utterly important to find out whether or not the banks are serving an important
contribution to develop different sectors of the economy. Cash and Bank Balance and Deposits
occupies major portion of banking income. It plays a vital role in updating the national economy.

There are too many banks and financial company in present market, which are trying to give
more interest and facility to the consumer for collection on deposit. For the collection of more
deposit Prabhu Bank should try to provide its scheme to other account holders also. It should try
to give other facility to the depositors for the collection of deposit like giving some gifts for the
old sincere customer.

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The bank should give first priority to agriculture sector and industrial sector because agriculture
and industrial sectors are main sources of livelihood. Its rules and regulation are not that strict.
So, it should amend its rules and regulation according to situation and central bank direction.

3.2 Conclusion

It is concluded from the observed analysis of above data that ratios control the major economic
activities of the nation. Therefore, it is very important for the policymaker to adopt appropriate
policy with calculation interest rate. Therefore, that large capital can be mustard at very low
capital cost. It will encourage the industrial and commercial activities eventually lending to
better economic condition growth, social economic development, and employment opportunities.

Descriptive and analytical research designs have been presented to analyze the financial position
of Nepal Prabhu Bank Limited. This study is based on secondary data obtain from various
sources.

3.3 Recommendations

Some recommendations are being put forward on the basis of conclusion through study:

1. Now that the economic condition of the country deteriorating, there is a damages in
slackening of the business and industrial activities. So, the bank should not be interested
only in collecting huge amount of deposit by increasing interest rate only.
2. The banks mobilized capital should be made available for investment in productive
enterprise whether the business is of small, medium or large sized. Thus, no bank should
expand its credit to promote economic development more rapidly.
3. There is a service completion among joint venture bank, finance companies and
insurance companies may go to losses. So, the bank should give emphasis on modern
technologies, should be growth service oriented, train the staff, get up to date information
about other bank and high services should be put forward to customers.
4. Employees should be associated whenever possible in discussion with customer and
inspective and other business visit with the objective of developing communication and
familiarization between them and customers. All employees should be provided with

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 nameplates, which will give them identification and will help customer in knowing them
by name.
5. The bank should grab more opportunities as soon as possible by adopting efficient and
latest market strategies, traditional method should be left behind.
6. Government, NRB and commercial banks should take necessary steps to form and
regulate banking habit of Nepalese people especially people of rural areas.
7. Other than shareholders annual report, the bank should publish and distributed booklets
containing detail information about its activities and performances as well. This help to
maintain harmonious relationship between bank and customers.

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