FINAL PROJECT

NATIONAL BANK of PAKISTAN

BBA MONEY AND BANKING DEPARTMENT OF MANAGEMENT SCIENCES

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banks.

CKNOWLEDGEMENTS

Praise is to Allah Almighty, the one testing us all at all times and making decisions about what we dont know and cant know. Writing this report appeared to be a great experience to us. It added a lot to our knowledge while we were working on this report. If we say that this project is one of our memorable experiences in student life, then it would not be wrong as this was our first experience in life of visiting a bank. Moreover, this project also enabled us to see how the theoretical concepts learnt in class through course books are practically being implemented in

We owe profound gratitude to our subject teacher for stimulating our creative abilities by assigning this project to us. Whatever we have learnt from her and this project has put indelible impression on our mind. We are immensely obliged to all our fellow students who guided us in making this report, without whose considerate attention and interest, it would be difficult for us to complete this report on time. We, being the members of our group, also thank one another for contributing the best in this group project without any conflicts and with great cooperation. It is our conviction that this learning experience will always be a source of help in our practical life and professional career.

Table of contents
NATIONAL BANK-AN INTRODUCTION............................................................................................................ 2 NATIONAL BANK OF PAKISTAN-HISTORY .................................................................................................... 5 FUNCTIONS OF NBP ............................................................................................................................................... 7 DEPARTMENTS IN NATIONAL BANK OF PAKISTAN ............................................................................... 10 OPERATIONS DEPARTMENT ..................................................................................................... 11 CREDIT DEPARTMENT ............................................................................................................... 13 FOREIGN EXCHANGE DEPARTMENT ........................................................................................ 15 REMITTANCE DEPARTMENT..................................................................................................... 20 CASH DEALING DEPARTMENT .................................................................................................. 23

NATIONAL BANK OF PAKISTAN

NATIONAL BANK-AN INTRODUCTION

National Bank of Pakistan is the largest commercial bank operating in Pakistan. It has redefined its role and has moved from a public sector organization into a modern commercial bank. The Bank's services are available to individuals, corporate entities and government. While it continues to act as trustee of public funds and as the agent to the State Bank of Pakistan (in places where SBP does not have a presence) it has diversified its business portfolio and is today a major lead player in the debt equity market, corporate investment banking, retail and consumer banking, agricultural financing, treasury services and is showing growing interest in promoting and developing the country's small and medium enterprises and at the same time fulfilling its social responsibilities, as a corporate citizen. National Bank of Pakistan has built an extensive branch network with over 1250 branches in Pakistan and operates in major business centre abroad. Bank of Pakistan has its headquarters in Karachi, Pakistan. It is now listed on the Karachi / Islamabad / Lahore Stock Exchanges. Under a trust Deed, the bank also provides services as trustee to National Investment Trust (NIT) including safe custody of securities on behalf of NIT. The Bank has representative offices in Beijing, Tashkent, Chicago and Toronto. It has agency arrangements with more than 3000 correspondent banks worldwide. Its subsidiaries are Taurus Securities Ltd, NBP Exchange Company Ltd, NBP Capital Ltd, NBP Modaraba Management Company Ltd, and CJSC Bank, Almaty , Kazakhstan . The Bank's joint ventures are, United National Bank (UK), First Investment Bank and NAFA, an Asset Management Company (a joint venture with NIB Bank & Fullerton Fund Management of Singapore). National Bank of Pakistan is today a progressive, efficient, and customer focused institution. It has developed a wide range of consumer products, to enhance business and cater to the different segments of society. Some schemes have been specifically designed for the low to middle income segments of the population. These include NBP Karobar, NBP Advance Salary, NBP Saibaan, NBP Kisan Dost, and NBP Cash n Gold. The bank has implemented special credit schemes like small finance for agriculture, business and industries, administrator to Qarz-eHasna loans to students, self employment scheme for unemployed persons, public transport

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scheme. The Bank has expanded its range of products and services to include Shariah Compliant Islamic Banking products. The Bank is also the largest sponsor of sports in Pakistan. It has provided generously to philanthropic causes whenever the need arose. National Bank has earned recognition and numerous awards internationally. It has been the recipient of The Bank of the Year 2001, 2002, 2004 and 2005 Award by The Banker Magazine, the Best Foreign Exchange Bank Pakistan for 2004, 2005, 2006 and 2007, Global Finance, Best Emerging Market Bank from Pakistan for the year 2005, Global Finance, Kisan Time Awards 2005 for NBP's services in the agriculture field. It is listed amongst the Region's largest banks and also amongst the largest banks in South Asia 2005, The Asian Banker. It has also been presented a Recognition Award 2004 for having a Gender Sensitive Management by WEBCOP AASHA besides other awards.

VISION
To be recognized as a leader and a brand synonymous with trust, highest standards of service quality, international best practices and social responsibility.

MISSION
NBP will aspire to the values that make NBP truly the Nations Bank, by:

Institutionalizing a merit and performance culture Creating a distinctive brand identity by providing the highest standards of services Adopting the best international management practices Maximizing stakeholders value Discharging our responsibility as a good corporate citizen of Pakistan and in countries where we operate

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CORE VALUES
Highest standards of Integrity Institutionalizing team work and performance culture Excellence in service Advancement of skills for tomorrows challenges Awareness of social and community responsibility Value creation for all stakeholders

GOAL
To enhance profitability and maximization of NBP share through increasing leverage of existing customer base and diversified range of products.

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NATIONAL BANK OF PAKISTAN-HISTORY

The history of National Bank of Pakistan is part of Pakistans struggle for economic independence. National Bank of Pakistan was established on November 9, 1949 under the National Bank of Pakistan Ordinance, 1949 in order to cope with the crisis conditions which were developed after trade deadlock with India and devaluation of Indian Rupee in 1949. Initially the Bank was established with the objective to extend credit to the agriculture sector. The normal procedure of establishing a banking company under the Companies Law was set aside and the Bank was established through the promulgation of an Ordinance, due to the crisis situation that had developed with regard to financing of jute trade. The Bank commenced its operations from November 20, 1949 at six important jute centers in the then, East Pakistan and directed its resources in financing of jute crop. The Banks Karachi and Lahore offices were subsequently opened in December 1949. The National Bank of Pakistan came forward to establish its offices in the Cotton growing areas and extended credit facilities liberally in order to restore stability to the market. In 1951, the country was once again faced with a crisis in the cotton trade when prices was crashed and touched the lowest level since independence following the cessation of hostilities in Korea. The bank in collaboration with the cotton board provided the necessary Credit facilities to the trade and the crisis was tided over. The nature of responsibilities of the Bank is different and unique from other banks/financial institutions. The Bank acts as the agent to the State Bank of Pakistan for handling Provincial/Federal Government Receipts and Payments on their behalf. The Bank has also played an important role in financing the countrys growing trade, which has expanded through the years as diversification took place. The National Bank of Pakistan has its headquarters in Karachi, Pakistan The precise summary of National Bank of Pakistan regarding its countrywide and overseas operations is as follows:

1949 National Bank of Pakistan (NBP) was established under the National Bank of Pakistan Ordinance 1949 and was 100% govt.-owned. NBP acted as an agent of the Central Bank wherever the State Bank did not have its own Branch. It also undertook Government Treasury operations. Its first branches were in jute growing areas in East Pakistan. Offices in Karachi and Lahore followed. 1950 NBP established a branch in Jeddah, Saudi Arabia. The Bank in 1950 had one subsidiary The Bank of Bahawalpur on December 4, 1947 by the former Bahawalpur State. 1955, by this time NBP had branches in London and Calcutta. 1957 - NBP established a branch in Baghdad, Iraq. 1964 - The Iraqi government nationalized NBP's Baghdad branch. 1965 - The Indian government seized the Calcutta branch on the outbreak of hostilities between India and Pakistan.
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1967 -The Tanzanian government nationalized the Dar-Es-Salaam branch. 1971 - NBP acquired Bank of China's two branches, one in Karachi and one at Chittagong. 1974 - The government of Pakistan nationalized NBP. As part of the concomitant consolidation of the banking sector, NBP acquired Bank of Bahawalpur (est. 1947). 1977 - NBP opened an offshore brain Cairo. 1994 - NBP amalgamated Mehran Bank (est. 1991). 1997 - NBP's branch in Ashgabat, Turkmenistan commenced operations. 2000 - NBP opened a representative office in Almaty, Kazakhstan. 2001 - State Bank of Pakistan and Bank of England agree to allow only 2 Pakistani banks to operate in the UK. NBP and United Bank agreed to merge their operations to form Pakistan International Bank, of which NBP would own 45% and United Bank 55%. 2003 - NBP received permission to open a branch in Afghanistan. 2005 NBP closed its offshore branch in Cairo.

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FUNCTIONS OF NBP
Since NBP is a commercial bank, it performs a variety of functions. Like other commercial banks, NBP is engaged in financing international trade. Its other major functions include receiving deposits, advancing loans and discounting of exchange. The functions performed by NBP are: 1. ACCEPTING DEPOSITS This function is important because banks largely depend on the funds deposited with them by its customers. Deposits are of many types:

Current deposits

Current deposits are also called demand liability on current deposits. NBP pays practically no interest on current deposits. Businessmen usually open current accounts. In NBP current account can be opened with a minimum amount of Rs.500/-.

PLS saving deposit

Profit and loss sharing deposits (PLS) are also called checking accounts. One can deposit and draw money easily. Profit on PLS is calculated every month but paid after six months. PLS account can be opened with a minimum amount of Rs.500/

PLS term deposits

Fixed term deposits are deposits with the bank for certain fixed period before the expiry of which they cannot be withdrawn unless giving due notice. In this case the rates of profit will be different depending upon the time period. 2. DISCOUNTING BILLS OF EXCHANGE Discounting of bill is practically speaking lending for exchange at their market rate i.e. it pays to holder of the bill an amount equal to the face value after deducting interest at the current market
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rate for the period. This bill has to be mature. This is the common way used for keeping a part of assets of the bank in a liquid form. 3. AGENCY SERVICE NBP also provides best and unique service to its valued customers. NBP provide the following agency services to the customers:

Collection of dividends

As NBP deals with the purchase and sale of various types of securities, therefore NBP also provide dividend or interest earned on share or bonds or invested money.

Collection of Cheques

In the collection and payment of Cheques, bills and promissory notes etc. National bank of Pakistan acts as an agent for its customers.

Acting as an agent

NBP also acts as an agent correspondent or representative for its customer at home or abroad.

General utility services

Utilities provided by NBP are as follows: a. Clearance of utility bills NBP provides the service of clearing the utility bills i.e. electricity, gas and telephone bills of its customers. For this purpose it also provides evening banking services b. Lockers facility National bank of Pakistan also provides locker facilities to its customers to keep their valuable assets in it. The charges of different size of lockers are different.

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c. Acts as a referee NBP provides useful services to its customers by acting as a referee to their credit worthiness. d. Supply of information NBP provides operational and advisory service for foreign exchange accounts/activities. 4. OTHER BANKING FUNCTIONS

Deposit security, Guaranteed by Government of Pakistan. Highest rates of return to attract the savings. Lowest rates on exports and other borrowings. Largest contribution towards Government and Semi-Government requirements. Agents of the SBP handling Treasury Functions, receipts of Taxes & other Revenues. Handling of salaries & pensions of federal/provincial/defense personnel. Utility Bills collections. Hajj arrangements. Sale and encashment of prize Bonds. Sale and encashment of Defense Savings and Special Savings Certificates. Safe Deposit Lockers for customers.

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DEPARTMENTS IN NATIONAL BANK OF PAKISTAN

OPERATIONS DEPARTMENT CREDIT DEPARTMENT FOREIGN EXCHANGE DEPARTMENT REMITTENCES DEPARTMENT CASH DEALING DEPARTMENT

The functions and management of each of these departments has been explained further in the report.

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OPERATIONS DEPARTMENT
FUCTIONS OF OPERATIONS DEPARTMENT
The main functions of operation department of NBP are: 1. 2. 3. 4. 5. 6. 7. Account opening Cheque payment and collection Cheque book reissuance Lease finance Car financing Consumer loaning Safety lock-ups system

1. ACCOUNT OPENING:
After getting the proposal form (a form issued by the bank before the opening of an account) cleared by the national bank, the necessary amount is deposited in the bank by the customers. After depositing initial money, the bank provides a cheque book, a pass book and a pay in slip in case of the savings account. In case of the fixed deposit a fixed deposit slip is issued. In case of current account a cheque book and a pay in slip is issued. For recurring account a pass book and a pay in slip is issued.

2. CHEQUE PAYMENT AND COLLECTION:

It is the function of the operations department of NBP to collect the cheques and made the payments on the cheques. As we know the cheque is delivered by the drawer to the payee. The payee then deposits the cheque by delivering it to her or his own bank, called the collecting bank. The collecting bank then delivers the cheque to the drawer's bank, the bank to which the original order was addressed. The drawer's bank is known as the paying bank, and the entire process is known as 'collecting the cheque'. A cheque may be payable on demand, so that the payee is entitled to be paid immediately (provided none of the restrictions discussed below apply) when a cheque is produced at the paying bank. The bank may take the time to refer to the account or to verify the signature on the cheque, but payment must be made readily and promptly.

3. CHEQUE BOOK REISSUANCE

It is also a function of operations department of NBP to reissue the cheques to its customers on their request. Customers fill a reissuance form and deposit it to the bank and as a result bank reissues the cheque book to its customer.

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4. LOCKERS SERVICE:
Operations department also provides the facility to the customers of NBP to keep their valuable assets in it. National bank of Pakistan also provides lockers facility in the country. The lockers issued only to the depositors. No lockers are issued to any unknown person. The dual control system is used for lockers. The officer has master key to apply on the locker but he cannot open the locker of any person. The locker holder provides the bank has specimen signature. Whenever the locker holders come to open the locker, his signatures are verified by the officer and then will be able to open his locker. If the key of the locker is lost company providing these lockers breaks the locker and new lock is fitted in its locker and lock is destroyed in the presence of the locker holder and bank charges RS 1200 for that. In case the locker holder dies, the court opens his locker in the presence of his heir as mentioned in his will or and his belongings are given to them and the locker is closed. For this facility the customers have to pay extra charges. SOME OTHER FUNCTIONS OF OPERATIONS DEPARTMENT ARE: Confirm the details of transactions with other banks. Wire funds to other firms and confirm the receipt of funds. Ensure transactions are booked properly in bank systems. Reconcile transactions between different computer systems. In some cases generate reports of exposures/risks/profit and loss. Post collateral, call for collateral and revalue collateral.

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CREDIT DEPARTMENT
The most important activity of the bank is the granting of credit to the customers. NBP credit department provides short term, long terms financing for domestic and i nt ern a t i onal t rade. Th e p ol i ci es m ade b y ce nt ral offi c e of t h e cas h c an b e a m e n d e d o n t h e b a s i s o f t h e r u l e s a n d r e g u l a t i o n , e c o n o m i c risk of each country board of directors and committee of the NBP m a d e t h i s t y p e o f decisions and informed about these decisions to the branch managers. Manager can grant the credit limit to each customer within the declared limits approved b y t he co nt rol l i ng of fi ces i . e ., co, G HQ, ci rcl e and z onal . Banks grant credit to the customer for a certain period of time. The banks provided credit to the customers so that they can purchase ahead of their liability. By giving these facility to the customers large scale production of commodity c an be achi ev ed and econom i c growt h r a t e can be i nc reas ed . The power t o sanctioned loans had been delegated for controlling different offices, acco rdi n g t o am o u nt of l oan. Thi s depart m ent i s al so c al l ed as ri sk management group.

FUNCTIONS OF CREDIT DEPARTMENT

1. CONSUMER LOANING:
It provides different types of loans to the customers like: Mortgage loans Production loans Working Capital and Short Term Loans Personal loans Working capital loans Other micro loans

2. LEASE FINANCE:
Operations department of NBP also provides lease finance to its customers. Lease finance provides a significant source of funds for companies to acquire or use assets. Leasing provides additional earning opportunities to acquire assets and to get the inflows simultaneously out of the operations of the same assets. The ownership of the asset is vested with the Bank (lessor) and in return for rental payments; the client (lessee) has full use of the asset. Being a medium to long term mode of financing, it allows the lessee to use the funds for other profitable purposes which otherwise would have been tied up in case of immediate payment for purchase of the asset.

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3. CAR FINANCING: Operation department also deals in car financing programs of NBP. NBP gives different benefits to its customers in car financing like: Customize your car loan by choosing fixed or variable interest rate. Get access to flexible payment term: weekly or monthly payment terms with the option to prepay in part or in full or in any time and with no penalty. Take up to eight years to pay back your loan. Take advantage of this extended repayment period to choose a vehicle model or optional features that meet your needs like extra cargo space or a more energy-efficient car.

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FOREIGN EXCHANGE DEPARTMENT

National bank plays an important role in the foreign exchange markets. It tries to control the money supply, inflation, and/or interest rates and often have official or unofficial target rates for their currencies. They can use their often substantial foreign exchange reserves to stabilize the market. Foreign exchange plays an important role in the payments of international trade. Foreign exchange is an important department in bank system. In the foreign exchange department all the operations of the bank are done in the same way as in all other departments of the bank this department also involve in deposits, remittances and advances but the difference with other department that the foreign exchange department deals in foreign currency rather than in local currency. In National Bank of Pakistan, four currency accounts are available:

US Dollar Pound Sterling Japanese Yen Euro

FUNCTIONS OF FOREIGN EXCHANGE DEPARTMENT

F o r e i g n e x c h a n g e d e p a r t m e n t i s c o n t r o l l e d b y O G - I I I . T h i s d e p a r t m e n t performs different functions such as:

FOREIGN CURRENCY DEPOSITS.

ACCOUNT OPENING ACCOUNT CLOSING

INWARD/OUTWARD FOREIGN REMITTANCE. ISSUANCE OF TRAVELER CHEQUES

ACCOUNT OPENING
Foreign Currency accounts can be opened in following three types as offered by NBP: Foreign Currency Current Account Foreign currency current account can be opened with a minimum balance of $500. This account is not entitled to any profit.

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Foreign Currency PLS Account Foreign currency PLS account require $100 for opening and this account is eligible to share the profits and losses at the rate that is prescribed by the Head office from time to time. Foreign Currency Fixed Deposit Account In this type of account the deposits are accepted for a period of minimum 3months and maximum up to 3 years. The profits are credited to the accounts after every six months on a rate that is ascertained by the Treasury Division of the National Bank of Pakistan Head Office Karachi. The profit is provided on daily product basis, which means that profit is credited based on the balance in the account and the number of days it has remained in the account. Profit On Foreign Currency Accounts The profit on foreign currency accounts is paid only on the US Dollar account a n d P o u n d S t e r l i n g a c c o u n t . T h e o t h e r t w o c u r r e n c i e s a r e n o t e n t i t l e d t o receive profit on the balances.

TERMS AND CONDITIONS

Account opening requires two things 1) National ID card of the customer and introducer 2) Introducer

CUSTOMER: Customer is the person who comes with the purpose of opening the account.

INTRODUCER: Introducer is a person having the account in same branch and gives guarantee about the customer.

Procedure of Account Opening and Depositing Foreign Exchange:

First of all, the customer is required to fill an application form. Then he attaches the photocopy of his identity card and fills the signatory cards. Then he is allotted an account number by entering in the account opening register. Now he fills the pay-in slip and deposits money on the counter. Following things are needed for opening of account: 1. Account opening form 2. Signature card
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3. Letter of kinship 4. Letter of thanks 5. Issuances of cheque book

Account opening form: Account opening form consist of a. b. c. d. e. f. Category of account Currency Title of account Account number Customer information Initial deposit

g. Authorized person in case of customer death Signature card: The signature card included the name and specimen signature of the customer Letter of kinship: In the letter of kinship the customer authorized the bank to pay the proceedings of his/her PLS/Current foreign currency account to the related person by describing the relationship of the person with the customer after the death of the customer. Letter of thanks: Letter of thanks is the latter issued by the bank to the customer for two purposes 1) 1st purpose is to say thanks to the customer for opening the account in their bank 2) 2nd purpose is to confirm the address provided by the customer while opening the account. Issuance of cheque book: Cheque book is issued to the customer after sending the letter of thanks when the customer comes with the letter of thanks and requests for the issuance of the cheque book. A cheque book (usually having 25 leaves) is issued to the customer.

CLOSING OF ACCOUNT:
The customer can close the account. The customer is required to submit an application for closing the account. The account is closed out and his balance is paid to him after deducting the closing charges, i.e. $ 20 and the application is filed in account closing file. There are many reasons for closing of account 1. Account holder Owen request 2. Death of account holder
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3.

Closing of account due to the bad manners of account holder

INWARD/OUTWARD REMITTANCES:
NBP deals in the following remittances types: a. b. c. d. e. f. g. Foreign Telegraphic Transfer (FTT) Foreign Demand Draft (FDD) Foreign mail transfer(FMT) SWIFT Western union money transfer(WUMT) Foreign Exchange Bearer Certificates (FEBC) Special US Dollar Bond

Foreign Telegraphic Transfer: This is telegraphic transfer just like ordinary local currency TT, but this is foreign currency. Its charges are fixed, i.e., if payment is in cash, charges are Rs. 1500. If payment is through account, Rs. 1200; if deposit is above Rs. 50,000 charges are Rs. 600. Foreign Demand Draft: Foreign Demand draft is also known as FDD. A person who wishes to remit money to someone in another place may if he does not send his own cheque, obtain from his bank a draft on demand payable to the person who is to be paid the money. The bank charges commission Rs. 500 flat, excise duty Rs. 4 for charges. Foreign Mail Transfer: These are also known as FMT. Transfer by mail of an account of currency to another country. The Remitter sign auroras requesting the banker to transfer the amount by mail, giving the name and address of the payee. Foreign Exchange Bearer Certificates (FEBC): Foreign Exchange Bearer Certificates can only be issued from Foreign Currency Account and not from deposit of local currency. The maturity period of these certificates are 5 years, 7 years and 9 years. It can be issued and enchased only in rupees. The customer account is debited and state bank of Pakistan (SBP) is credited. Special US Dollar Bond: The bonds have the maturity period of 3 years, 5 years and 7 years. The bank gives the interest at the rate of 5% + LIBOR, i.e. 2%, 3% and 4% respectively. SWIFT: The SWIFT system (Society for Worldwide Interbank Financial Telecommunication) has been introduced for speedy services in the area of home remittances. The system has built-in features of computerized test keys, which eliminates the manual application of tests that often cause delay
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in the payment of home remittances. The SWIFT Center is operational at National Bank of Pakistan with a universal access number NBP-APKKA. Swift is a software. It is used for following purposes Financial transactions Non-financial transactions Linking Import export Western Union Money Transfer: Western union money transfer is a fastest way to receive money worldwide. It is working in almost 200 countries. Different government and private organization are dealing with WUMT.

ISSUANCE OF TRAVELERS CHEQUE

Negotiability: Pak Rupees Traveler's cheques are a negotiable instrument Validity: There is no restriction on the period of validity Availability: At 700 branches of NBP all over the country Encashment: At all 400 branches of NBP Limitation: No limit on purchase Safety: NBP Traveler's cheques are the safest way to carry our money

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REMITTANCE DEPARTMENT
NBP has taken various measures to facilitate overseas Pakistanis to send their remittances in a convenient and efficient manner. In 2002 the Bank signed an agreement with Western Union for expanding the base for documented remittances. More recently it has started Electronic Home Remittances Project. This project introduces technology based system to handle inward remittances efficiently, by ensuring that the Bank's branches keep a track of the remittance received from abroad till its final receipt. Remittance is the monitory transfer from one place to another place or from one country to another country to fulfill the requirements of the customers by the order of the customer. This department is responsible for inward and outward remittances through demand draft (DD), telegraphic transfer (TT) or cheque collection. Customers Service Staff of the National Bank Limited assists its client who wants to have Demand Draft, Telegraphic Transfer, or Pay Order prepared for them. Customer Service Officers fill the application on their behalf and writes on the application the bank charges for the insurance of DDs, TTs, or Pay Orders. These applications are then handed over to the Customer Service Operations Department who prepared the required documents of funds transfer. After the preparation of DD / TT / Po's, they are handed over to the Customer Service Officer who delivers them to the customers. It also provides account statements to the customers and answering their queries regarding their accounts. Remittance Department at NBP can be divided into two sections due to its activities. 1) Local Remittance 2) Foreign Remittance

1) LOCAL REMITTANCE
Local remittance section deals with remittance (incoming and outgoing but only in local i.e, Pakistani rupee and within Pakistan. Local remittance includes the following seven functions in NBP:

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a) Transfer through pay order

Pay Order is made for the local transfer of money. National Bank of Pakistan takes fix collection of Rs. 15 on pay order. Pay order also comes for clearing from SBP. NBP official checks entries are made in register.

b) Transfer through demand draft

A bank draft is an order drawn by one branch of the bank to another of the same bank to pay a certain sum of money on demand or to the person named there on. DD is another mode of transfer. It is just like a cheque. The application form is filled in the beneficiary name, account number and senders name is written. The customer deposits the amount of DD in the branch concerned. Then DD is made and given to the customers. National Bank of Pakistan official note the transaction in issuance registers on the page of that branch of National Bank of Pakistan in which the DD will draw. They also send advice to the branch to which the DD is sent. An OPEN DD is one in which direct payment is made. A CROSS DD is one on which payment is made through account.

c) Telegraphic transfer
It is the fastest mode of transfer of money. Sometimes when the remitter urgently desires the remittance, he may request to issue to telegraphic transfer. TT may be issued to general public on their written request and against the value received. The customers fill the forms and deposits cash. The official of the National Bank of Pakistan send instruction regarding payment to the drawee branch via telephone in the coded language and under confidential number known as TEST NUMBERS. Or telephone call is made to the said branch to make payment to customers. Vouchers are sent by ordinary mail to keep the record. Telephone charges are also taken from the customers. No excise duty is taken on TT.

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d) Mail transfer
It is a mode of transferring money from one branch to another branch either within the same city or in cities throughout country. MTs may be issued for transferring funds in one account to another account branch or to any person not requiring urgent remittance or draft. Customers fill same application and deposit the cash in the same way. National Bank of Pakistan official record the transaction voucher and advices are made and sent to responding branch. National Bank of Pakistan takes Rs. 10 as mail charges from application. No excise duty is charged on MT.

e) Local / internal transfer f) Preparation of balance certificates g) Issuing SBP cheques

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CASH DEALING DEPARTMENT

The head of this department is an accountant. All the cash is given with fixed amount in the morning from which they can make payments. Cash department of NBP is given the complete responsibility of handling all receipts & disbursement of cash to carry on transactions in both local & foreign currencies & near cash items such as traveler cheque etc ( when they are issued against cash). At the cash counter, local currency receipts and payments are handled. Cheques are received and presented for transfer or collection. As a consequence it is also responsible for the book keeping of these transactions & the safe custody of cash & near cash securities of NBP. All the money is kept in the strong room. Cash handling is very risky job, therefore, only authorized person is allowed to enter cash department.

a) Cash receipts for receiving deposits. b) Encashment of cheque

A) CASH RECEIPT
The depositor uses cheque deposit slip (or cash deposit slip) for depositing the amount. There are two types of cash deposit slip: a) One for current account holders b) Other for saving account holders Both are in different colors for clear identification. There are two parts of cash deposits slips: a) Counter foil b) Adjacent credit voucher.
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CASH RECEIPT SECTION In this section the cashier receives cash. He records the cash received with a pay in slip and other documents (if necessary) and records it in the cash receipt register. There are two separate types of pay-in-slips, which are used for depositing cash, checks, and drafts. There are prescribed forms in which the information is feed. After filling the pay-in-slip with the amount, the cash and slip both are received by the cashier who enter those in the cash register and fix a stamp on the pay-in-slip. A part of this slip is given to the customer for his record and other is maintained with the bank.

2) ACCEPTANCE OF CHEQUE
As the checks holders go to the token section, they present the checks to the person at the section. Then he allots a number to the check and a token is given to the customer / check holder. The cash is paid against the cheque of the client. The following points are kept in mind while receiving the cheque from the client.

Cheque should be drawn on NBP It should not be post dated. It should be bearer cheque so the word bearer should not be crossed. Payment is not stopped by the drawer. Amount in words & figure should be same. Alternation in date / figure / word require drawers full signature with signature on the cheque.

AFFIRMATION OF SIGNATURES After receiving the cheque the officer verifies the signature of the account holder with the signature on the cheque. It signatures are not the same then it is returned back otherwise forwarded to computer terminal.

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COMPUTER TERMINAL PROCESS The cheque is received in computer terminal, where the computer operator checks the balance of the account holder. The operator also sees whether the stop payment instructions are received from account holder or not. After considering these two points computer operator posts the cheque in account holder ledger & returns the cheque back to the officer.

PAYMENT OF CASH The cheque is canceled after posting & is returned to cashier. The cashier enters the cheque in cash paid register & pays against the second signature of the receiver on the back of the cheque.

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