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FINANCIAL PERFORMANCE ANALYSIS OF

“NIC ASIA BANK LIMITED” (NIC ASIA)

A Project Work Report

Submitted by: Sujan Shahi

T.U. Reg No: 7-2-31-49-2016
Exam Roll No: 700320167
Saraswati Multiple Campus, Lekhnath Marga, Thamel

Submitted to:
The Faculty of Management
Tribhuvan University Kathmandu, Nepal
In Partial fulfillment of the requirements for the degree of
BACHELOR OF BUSINESS STUDIES (BBS)
Kathmandu, Nepal
July 2024
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DECLARATION

I hereby declare that the project work entitled “FINANCIAL

PERFORMANCE ANALYSIS OF NIC ASIA BANK” (NIC ASIA)
submitted to the Faculty of Management, Tribhuvan University,
Kathmandu is an original piece of work under the supervision of Mr.
Narayan Prasad Aryal, Faculty Member of Research Committee,
Saraswati Multiple Campus, Lekhnath Marga, Thamel, Kathmandu, and
is submitted in partial fulfillment of the requirements for the award of the
degree of Bachelor of Business Studies (BBS). This project work report
has not been submitted to any other university or institution for the award
of any degree or diploma.

....................
Sujan Shahi
July 2024
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SUPERVISOR’S RECOMMENDATION

The project work report entitled “FINANCIAL PERFORMANCE

ANALYSIS OF NIC ASIA BANK” (NIC ASIA) submitted by Sujan
Shahi of Saraswati Multiple Campus, Lekhnath Marga, Thamel,
Kathmandu, is prepared under my supervision as per the procedure and
format requirements laid by the Faculty of Management, Tribhuvan
University, as partial fulfillment of the requirements for the award of the
degree of Bachelor of Business Studies (BBS). I, therefore, recommend
the project work report for evaluation.

……………………...........
Mr. Narayan Prasad Aryal
(Supervisor)
July 2024
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ENDORSEMENT

We hereby endorse the project work report entitled “FINANCIAL

PERFORMANCE ANALYSIS OF NIC ASIA BANK” (NIC ASIA)
submitted by Sujan Shahi of Saraswati Multiple Campus, Lekhnath
Marga, Thamel, Kathmandu, in partial fulfillment of the requirements for
the award of the degree of the Bachelor of Business Studies (BBS) for
external evaluation.

................................... ...............................
Narayan Prasad Aryal Dr. Gol Man
Gurung Supervisor Campus
Chief
July 2024 July 2024
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ACKNOWLEDGMENTS

I would like to express my sincere gratitude to several individuals and

organizations for supporting me throughout my research study. First, I
wish to express my sincere gratitude to my supervisor, Mr. Narayan
Prasad Aryal, for his enthusiasm, patience, insightful comments, helpful
information, practical advice and unceasing ideas that have helped me
tremendously for conducting my research and preparation of this report. I
would like to thank all the staff members of the NIC ASIA Bank Limited
for their full support in providing all the necessary data which helped me
in the preparation of this research report. I could not remain without
thanking my teachers and lecturers of Saraswati Multiple Campus who all
helped me during my study of BBS and during preparation of this report.

I would also like to thank my friends for helping me throughout the study
with their guidance and support.

Sujan Shahi
T.U. Reg No: 7-2-31-49-2016
Exam Roll No: 700320167
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TABLE OF CONTENTS

Declaration...................................................................................................................ii

Supervisor’s recommendation.......................................................................................iii

Endorsement.................................................................................................................iv

Acknowledgements.........................................................................................................v

Table of contents......................................................................................................vi,vii

List of tables................................................................................................................viii

List of figures................................................................................................................ix

Abbreviations.................................................................................................................x

CHAPTER-I: INTRODUCTION.......................................................................................1

1.1. Background of the Study.................................................................................1

1.1.1. Meaning of Financial Analysis.................................................................1

1.1.2. Elements of the financial analysis............................................................1

1.1.3. Commercial Banking Scenario in Nepal..................................................3

1.2. Profile of NIC ASIA Bank Limited.................................................................3

1.2.1 Shareholding Composition............................................................................5

1.2.2. NICA Network Overview.............................................................................5

1.2.3. No. of Staff: 3,472 (As of July 16, 2024).....................................................6

1.2.4. Composition of Board of Directors..............................................................6

1.3. Statement of the Problem.................................................................................6

1.4. Objectives of the Study....................................................................................7

1.5. Rationale of the Study......................................................................................7

1.6. Review Of Literature.......................................................................................7

1.7. Method of study.............................................................................................10

1.7.1 Research Design:.........................................................................................11

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1.7.2 Population and Sample................................................................................11

1.7.3 Nature and Sources of Data.........................................................................12

1.7.4 Data Processing Procedures.........................................................................13

1.7.5 Data Analysis Tools....................................................................................13

1.8. Limitations of the study.................................................................................15

CHAPTER – II: RESULTS AND FINDINGS.................................................................16

2.1 Introduction:.......................................................................................................16

2.2 Financial Statement Analysis.............................................................................16

2.2.1 Liquidity Ratio............................................................................................16

2.2.2 Profitability Ratio:.......................................................................................22

2.2.3 Assets Management Ratio:..........................................................................28

2.3 Findings of the Research:................................................................................35

CHAPTER – III: SUMMARY AND CONCLUSION.....................................................37

3.1 Summary.............................................................................................................37

3.2 Conclusion..........................................................................................................37

BIBLIOGRAPHY

REFERENCES

APPENDICES
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LIST OF TABLES:

Table 1.1: Cash and Bank Balance to Total Deposit Ratio.....................................17

Table 1.2: Cash and Bank balance to Total Assets Ratio........................................19
Table 1.3: Current Ratio..........................................................................................21
Table 2.1: Return on Shareholder’s Fund...............................................................23
Table 2.2: Return on Total Assets...........................................................................24
Table 2.3: Earning Per Share...................................................................................26
Table 2.4: Dividend per Share.................................................................................27
Table 3.1: Loan and Advances to Fixed Deposit Ratio...........................................29
Table 3.2: Loan and Advances to Total Deposit Ratio............................................31
Table 3.3: Loan and Advances to Total Assets........................................................33
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LIST OF FIGURES:

Figure 1.1: Cash and Bank Balance to Total Deposit Ratio.....................................18

Figure 1.2: Cash and Bank balance to Total Assets Ratio........................................20
Figure 1.3: Current Ratio...........................................................................................21
Figure 2.1: Return on Shareholder’s Fund.................................................................23
Figure 2.2: Return on Total Assets...........................................................................25
Figure 2.3: Earning Per Share....................................................................................26
Figure 2.4: Dividend per Share..................................................................................28
Figure 3.1: Loan and Advances to Fixed Deposit Ratio...........................................30
Figure 3.2: Loan and Advances to Total Deposit Ratio............................................32
Figure 3.3: Loan and Advances to Total Assets.......................................................34
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ABBREVIATIONS

CB : Commercial Bank

CEO : Chief Executive Officer

CBB : Cash and Bank Balance

CV : Coefficient of Variation

DPS : Dividend per Share

EPS : Earnings per Share

i.e. : That is

Ltd. : Limited

NICA : NIC ASIA Bank Limited

NPAT : Net Profit after Tax

NRB : Nepal Rastra Bank

P&L Account : Profit and Loss Account

ROA : Return on Assets

ROE : Return on Equity

SD : Standard Deviation

TD : Total Deposit
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