A REPORT ON

DEPOSIT MOBILIZATION OF NABIL BANK

Submitted by:

GANESH PARAJULI

P.U. Exam roll-no. : 16450398

P.U.Registration no.: 2015-2-45-0417

A Project Work Report submitted to Pokhara University Axis

College in partial fulfillment of the requirement for the degree of
Bachelor of Business Administration in Banking and Insurance

Lekhnath, Kaski, Nepal

20 July 2018
 DECLARATION

This Summer Project Report entitled "PROPOSAL ON DEPOSIT

MOBILIZATION OF NABIL BANK." which is submitted by Mr. Ganesh Parajuli in
partial fulfillment of the requirement for the award of BBA-BI degree of Pokhara
University Comprises only my original work and due acknowledgement have been
made to materials used in the report.

………………

Ganesh Parajuli

Date: 2018-06-20
 Supervisor’s Recommendation

Certified that this project report on “PROPOSAL ON DEPOSIT

MOBILIZATION OF NABIL BANK” is the bonafide work by Mr.Ganesh Parajuli
who carried out the summer project work under my supervision. This report is
forwarded for examination.

…………………

Mr. Arjun Kafle

(Supervisor)

………………..

External Examiner:

Date:
 ACKNOWLEDGEMENTS

This report is a piece of work that speaks about the Proposal on Deposit
Mobilization of Nabil Bank. It gives me great pleasure in acknowledging the support
and help of the co-ordinator of Axis College. I also wish to especially thank to my
course instructor and lecturer stimulating suggestions and encouragement helped me
in every step of this project. I also express my sincere gratitude to all the other
respected faculties of the management department, librarian, lab technician and all
other office staff for their assistance and co-operation given to me in regard to this
work. I render my whole hearted thanks to Mr Arjun Kafle who gave me the privilege
to acquire necessary information for my project. I would also like to thank Nabil Bank
members and its management team for their support and co-operation. I also want to
thank all my colleagues and friends for their help, support, interest and valuable hints.
I have tried to include all the relevant information regarding the topic of my study.

Thanking you

Ganesh Parajuli

BBA-BI (Fifth Semester)

 TABLE OF CONTENTS

Title Page… … … … … … … … … … …… … … … … … … … … … … … ... i

Declaration … … … … … … … … … … …… … … … … … … … … … … … ii
Supervisor’s Recommendation … … … … … … … … … … … … … … … … ... iii
Acknowledgement… … … … … … … … … … … … … … … … … … … … … iv
Table of Content… … … … … … … … … … …. … … … … … … … … …… v
List of Tables … … … … … … … … … ... … … … … … … … … … … …. …vi
List of Figures … … … … … … … … … … … … … … … … … … … … … vii
Abbreviations … … … … … … … … … … … … … … … … … … … … ….. viii

CHAPTER-I
1. INTRODUCTION… … . … … … … … … … … … … … … … … Page No.
1.1. Back ground of the study … … … … … … … … … … … … … … … …… xx
1.1.1 Meaning and definition of Topic … … … … … … … … ... ... ... ..… xx
1.1.2 Relevancy of topic in Nepal… … … … … … … … … … … … … xx
1.1.2.1 List of services/production … … … … … … … … … … .xx
1.1.3 An overview of Topic … … … … … … … … … … … … … ... ... xx
1.1.4 Promoters associated with the research company … … … … … … ....xx
1.1.5 Head office and Branches of the company… … … … … … … … ..xx
1.1.6 Products and Services of researching company… … … … …. ... ...xx
1.1.7 Meaning of Financial Analysis … … … … … … … … … ….. ... ... xx
1.2. Statement of problem … … … … … … …. … … … … … … …. ... ... ... .xx
1.3. Objective of study … … … … … … … …. … … … … … … … … ... ... xx
1.4. Rational of study … … … … … … … … … … … … … …. …. ... ... ... ..xx
1.5. Report Structure … … … … … … … … … … … … … … … … … ... ... .xx

CHAPTER –II
2. LITERATURE REVIEW … … … … … … … … … … … … … … … … xx
2.1 Conceptual Review… … … … … … … … … … … … … … … …xx
2.2 Review of Previous Works… … … … … … … … … … … … … … … …xx
2.3 Research Gap … … … … … ….. … … … … … … . … … … … … … xx
CHAPTER –III
3. RESEARCH METHODOLOGY … … … … … … … … … … … … … ……xx
3.1. Type of Research … … … … ….. … … … … … … … … … … xx
3.2 Population sampling… … … … ….. … … … … … … . … … … … …. xx
3.3 Types of Data … … … … ….. … … … … … … . … … … … … … … xx
3.4 Data collection procedure… … … … ….. … … … … … … … … … … xx
3.5 Instruments… … … … ….. … … … … … … . … … … … … … … … xx
3.6 Statistical Tools and Techniques … … … … ….. … … … … … … . … … xx
3.7 Limitations of the Study … … … … ….. … … … … … … … … … … …xx
CHAPTER – IV
4. RESULTS AND FINDINGS … … … … … … … … … … … … … … …. xx
4.1 Presentation of data … … … … ….. … … … … … … . … … … … … ….xx
4.2 Data analysis… … … … ….. … … … … … … . … … … … … … … xx
4.3 Major Finding … … … … ….. … … … … … … . … … … … … … … … xx
CHAPTER –V
5. DISCUSSIONS, CONCLUSION …. … … … … … … … … … … … … …...xx
5.1 Discussion … … … … ….. … … … … … … . … … … … … … ...… … xx
5.2 Conclusion … …. … … … … ….. … … … … … … . … … … …xx

REFERENCE … … … … ….. … … … … … … . … … … … … … … … …xx

APPENDICES………………………………………………………..xx
 LIST OF TABLES

TABLE PAGE NO.

4.1 Current Ratio … … … … … … … … … … … … … … … …. xx
4.2 Cash and bank balance to deposits ratio… … … … … … … … xx
4.3 Long-term Debt to Net worth Ratio… … … … … … … … …. xx
4.4 Net worth to Total Liabilities Ratio… … … … … … … … …. xx
4.5 Capital Adequacy Ratio … … … … … … … … … … … ….. xx
4.6 Loan and Advances to Total Deposit ratio… … …. … … … …xx
4.7 Credit and Investment to Total Deposits Ratio… … … … … …xx
4.8 Interest Expenses to Total Expenses Ratio… … … … … … … xx
4.9 Total Interest Income to Credit & Investment Ratio… ….. … .. xx
4.10 Return on Assets … … … … … ,.. … … … … … … … … … xx
4.11 Return on Shareholder’s equity… … …. … …. … … … … … xx
3.12 Net Interest Earned to Total Assets Ratio… … … … …. … … xx

LIST OF FIGURES
FIGURE PAGE NO.

4.1 Current Ratio... … … … … … … … … … … … … … … … … … … … … xx

4.2 Cash and bank balance to deposits ratio … … … … … … … … … … … … xx
4.3 Long-term Debt to Net worth Ratio… … … … … … …. …. …. …. … …. …xx
4.4 Net worth to Total Liabilities Ratio… … … … … … … … … … … … … … xx
4.5 Capital Adequacy Ratio… … … … … … … … … … … … … … …. … … xx
4.6 Loan and Advances to Total Deposit ratio … … … … … … … … …. … …. xx
4.7 Credit and Investment to Total Deposits Ratio… … …. … … …. …. ….….. xx
4.8 Interest Expenses to Total Expenses Ratio… … … … … … …. … … … … ...xx
4.9 Total Interest Income to Credit & Investment Ratio… … … … … … … … ….xx
4.10 Return on Assets … … … … … … … … … … … … … …. …… … xx
4.11 Return on Shareholder’s equity… … … … … … … … … …. …. … … … …xx
4.12 Net Interest Earned to Total Assets Ratio… … … …. … … … … … … … … xx
 LIST OF ABBREVIATION

ATM Automated Teller Machine

BBA-BI Bachelors of Business Administration in Banking and Insurance
A.D. Anno Domi
HBL Himalayan Bank Limited
LC Letter of Credit
NRB Nepal Rastra Bank
No. Number
RBB Rastriya Banijya Bank
U.S. United States
etc. Etcetera
i.e. For example
% Percentage
 CHAPTER-ONE
INTRODUCTION

1.1 Background of the study

It is very hard to collect the correct information of the origin of bank. The
word “Bank” has derived from the Italian word “Banco” which means accumulation
of money of stock. It is believed that its origin is from the French word “Banque”
which means “beach” for keeping, lending and exchanging of money or coin in the
market place by money lenders or money changers. It is believed that the ancestors of
modern banking system were merchants, goldsmiths and moneylenders. Modern
banking sowed its seed in the medieval Italy despite strong Christian prohibitions
against charging interest.
The bank had started in Italy in 12th century as a public bank. The Bank of
Venice that was established in 1158 A.D. was the first bank in the history of
banking. Following its establishment various banks such as Bank of Barcelona,
which was established in 1401 A.D was the second bank of the world. Similarly,
Bank of Geneva (1407), Bank of Amsterdam (1609), Bank of Hindustan (1770) were
established. The first central bank was the “Bank of England” which was established
in 1844 AD.
Bank is a financial institution, which is engaged in monitory transaction. Bank
has always been the most importance and largest financial intermediates. Banks
collect the scattered money from public providing those interests and services. This
collection becomes the capital for the bank to invest. “Banking means the accepting of
money for the view of lending or investment of deposit from the public repayable on
demand or otherwise and withdraw able by cheque, draft or otherwise”, is according
to Banking Regulation Act 1949 of India. World Bank says “Banks or a financial
institution that accepts funds in the forms of deposit repayable on demand or at short
notice.”

1.1.1 History of Bank in Your Country

 In the context of Nepal, like as in the other countries the goldsmith and
landlords where the ancient banker. The Nepalese people were highly exploited by
‘Sahu Mahajan’ by charging higher interest rate, compound interest rate and even by
manipulating the principal amount. The introducing of ‘Tejarath Adda’ during the
tenure of the Prime Minister Ranoddip Sing (1993 B.S.) was the first step towards the
institutional development of banking in Nepal. The first commercial bank ‘Nepal
Bank Limited’ was established on 30th Kartik 1994 B.S.and started to perform proper
banking activities. With the realization of central bank to develop monetary policy as
well as to have proper control over commercial banks and banking sectors Nepal
Rastra Bank was established on 14th Baishak 2017B.S. under Nepal Rastra Bank Act
2015 B.S. Likewise, Rastra Banijya Bank under the full ownership of government
was established on Magh 2022 as per ‘Rastra Banijya Bank Act 2015 B.S.’. The
growths of the banks accelerated only after the adoption of liberal economic policy by
Nepalese Government .This has attracted many new investors and encourage opening
many new modern banks with joint venture of foreign banks. Nepal Arab Bank was
established on 29th Ashad 2041 B.S. as the first modern bank with the joint venture of
Dubai Bank Ltd. U.A.E. subsequently following its established Nepal Indo Suez Bank
France, Nepal Grinlands Bank England on 16th Marg 2043B.S. with its joint venture
of Grinlands Bank England, Himalayan Bank Ltd on 5th Marg 2049B.S. with the joint
venture of Habib Bank of Pakistan, Nepal SBI Bank Ltd. in28th Ashad 2050 B.S.with
joint venture of State Bank of India Nepal Bangladesh Bank Ltd. on 28th Jestha,
2050B.s. with the joint venture of International Finance Investment and Commercial
Bank, Everest Bank Ltd. on 1st Kartik 2051B.S. with joint venture of Punjab National
Bank Ltd of Kathmandu on 28th Falgun 2051B.S. with joint venture of the Siam
Commercial Bank, Thailand. Since, the financial sector in Nepal is small, it is
growing fast. At present banking system comprises of NRB,
28 Commercials banks and many financial companies, saving institution and non-
government organization conduction limited banking activities transaction. The
umbrella act set out regulation for licensing, supervision and cancellation of
commercial bank. Currently, the growths of commercial banks are shown below:-

1.1.2 List of Commercial Nepal Bank

1. Siddhartha Bank Limited
2. Nepal Bank Limited
3. Rastriya Banijya Bank Limited
4. Agriculture Development Bank Limited
5. Nabil Bank Limited
6. Nepal Investment Bank Limited
7. Standard Chartered Bank Nepal Limited
8. Himalayan Bank Limited
9. Nepal SBI Bank
10. Nepal Bangladesh Bank Limited
11. Everest Bank Limited
12. Bank of Kathmandu Lumbini Limited
13. Nepal Credit and Commerce Bank Limited
14. Kumari Bank Limited
15. Laxmi Bank Limited
16. Global IME Bank Limited
17. Citizens Bank International Limited
18. Prime Commercial Bank Limited
19. Sunrise Bank Limited
20. NMB Bank Nepal Limited
21. Nabil Bank Ltd Limited
22. Machhapuchchhre Bank Limited
23. Mega Bank Nepal Limited
24. Civil Bank Limited
25. Century Bank Limited
26. Sanima Bank Limited
27. Janata Bank Nepal Limited
28. Prabhu Bank Limited
(Source: nrbbank.com)

1.1.3 Introduction of Nabil Bank

A commercial bank is a financial institution which collects saving from many
persons and institutions and provides credit or loan facility to different industrial and
commercial business. Commercial banking business consists of changing cash into
hank deposit and bank deposit into cash, transferring bank deposit form one person or
institution to other, giving bank deposit in exchange for cheques, bills of exchange,
government securities etc.
Nepal Bank Limited established in 1994 BS is the first commercial bank in Nepal.
Commercial banks perform various functions. Among them, accepting various types
of deposit is the main function of commercial banks. Commercial banks are directly
related with the people and institution. The commercial bank is an important bank.
Its function is very attractive for people.In Nepal the commercial bank perform the
following functions. Of the many function of the commercial bank acceptance of
deposits is one of them. The bank allows for opening the three types of accounts to
accept deposit for their customers. They are current, saving and fixed deposit
account. People can collect their money in one of the three as their need. But the
interest is given to the saving and fixed account. The commercial bank performs the
important function of accepting all sorts of deposits. It earns profit by investing that
money in another place.

Another function of the commercial bank is to provide loan. A commercial

bank provide loan to a person, company and institution etc. A bank can earn a lot of
profit from it. A bank is capable of gain benefit in its banking development by
receiving the interest as pre law and its internal policies. It provides the loan by
accepting the security of debtor. A bank flow the loan
against a third person guarantee or with the pledge of the third person. A bank
provides the loan on basis of agreement or deed of loan. It provides loan on basis of
the following deed securities:

▪ With the pledge of goods, .and pledge of gold and silver.

▪ With the security of immovable property

▪ With the security of other similar goods.

Nabil Bank Limited (Nabil) commenced its operation on 12 July, 1984 as the
first joint venture bank in Nepal, Dubai Bank Limited. Dubai (Later acquired by
Emirates Bank International Limited, Dubai) was the first joint venture partner of
Nabil. Currently NB (international) limited. Ireland is the foreign partner. Nabil Bank
limited had the official name Nepal Arab Bank Limited till 3lst December 2001. Nabil
is the pioneer in introducing maims innovative products and marketing concept in
banking sector of Nepal with 15 branches and 2 counters in all major cities. It is the
only bank having its presence at Tribhuvan International Airport of the country. Also,
the number of outlets in the country is the highest among the joint venture and private
banks operating in Nepal. Success of Nabil is a milestone in the banking history
of Nepal as it paved the way for the establishment of many commercial banks and
financial institutions.
Nabil, as a pioneer in introducing many innovative products and marketing
concepts in the domestic banking sector, represents a milestone in the banking history
of Nepal as it started an era of modern banking with customer satisfaction measured
as a focal objective while doing business. Operations of the bank including day-to-day
operations and risk management are managed by highly qualified and experienced
management team. Bank is fully equipped with modern technology which includes
ATMs, credit cards, state-of-art, world-renowned software from Infosys Technologies
System, Banglore, India, Internet banking system and Telebanking system. Nabil
provides a full range of commercial banking services through its outlets spread across
the nation and reputed correspondent banks across the globe. Moreover, Nabil has a
good name in the market for its highly personalized services to the customers. At the
time of commencement it had Rs 100 million as Authorized Capital.

1.2 Statement of Problems

As we know that the main objective of any business organization e.g. Bank is profit
maximization. Deposit mobilization is the key factor to attain this objective: therefore,
if the bank fails to employ its funds suitably it is not possible to maximize profit. A
bank has to make decisions with a framework of statutory requirements of credit
regulation by center bank, as well as the national objectives that are determined in the
matter of the provision of credit from time to time. What is the trend of risk and return
pattern along the studied time horizon?
 What is the real and adjusted nature of EPS, BVPS etc.?
 Is Nabil Bank common stock really suitable for investment?
 What is nature of ROE, EPS, P/E ratios growth is equity etc?

1.3 Objective of the study

The main objective of the study is to fulfill the partial requirement of P.U to complete
BBA-BI project. The objective of this fieldwork is to analyses deposits collected in
 NABIL. The study intends to present a brief and clear picture of deposit and its
utilization. The objective of the study includes.
· To find out deposit trend of NABIL bank.
· To analyses the cost of deposit
· To analyses whether the deposits are being properly utilized or not

1.4 Rational of the study

Deposit collection is the major function of all commercial banks, which help to
carry out almost all transaction of the bank. Mostly among the various deposit
features provided by commercial banks, fixed and saving deposit are considered to be
more important In the case of term deposit although the banker pay interest (longer
the period higher the interest).
 To find out the position of Nabil Ban
 To find out the strength and weakness of Nabil Bank
 To find out the marketing style and public relation of the bank.

1.5 Report Structure

This study has been comprised into three sections, each devoted to some
aspects of deposit analysis of commercial banks (Nabil bank ltd). The titles of each of
these sections are summarized and the contents of each of these chapters of this study
are briefly mentioned here.
Chapter 1 : Introduction / Background
Chapter 2 : Related Literature Review
Chapter 3 : Methods
Chapter 4 : Results and findings
Chapter 5 : Discussion and Conclusion

The first section deals with the subject matter consisting General Background,
Nature of the Study, Objectives of the Study, Methodological Aspects, Limitations of
Study. The second section is concerned with nature of study Related literature review.
The third section concerned with the researches methods of the study. The fourth
section results and findings and presentation of data through tables, diagrams for five
years. The fifth section discussions and conclusion the reference is incorporated at the
end of the study.

CHAPTER TWO
LITERATURE REVIEW

2.1 Conceptual Review

Deposit collection is one of the main features of commercial bank. A
commercial bank receives deposit in different accounts namely current, fixed and
saving. These are the direct deposits. When a bank receives cash it grants a right to
the depositors to withdraw it whenever they like Nepal Banijya Bank Act has
regulated all the deposit 2031. The act specifies “Deposit” means amount deposited in
current, fixed and saving deposit account of bank or financial institutions. Among
many functions of a commercial bank the main function is deposit function, which all
the commercial banks perform, in simple terms; deposit is a function of collecting
surplus from savers.

2.2 Review of Previous Works

Bank accepts deposit from those that can save but can’t utilize profitably.
People know that by depositing in the bank they could avail with many more
facilities. By saving in the bank people have the opportunity of earning interest, useful
contingencies; avoid risk such as theft lost accidents, the deposit of commercial banks
is increasing because people know its importance. So banks accept money on current
saving and fixed deposit accounts. Deposits are the main source of capital for the
lending activities of the banks. Banks utilize efficiencies to attract more deposits to
increase credit activities. Deposits are withdraw able according to the terms of
contract with the depositors to attract the people. The bank maintains different types
of deposit accounts.
According to Commercial Bank Act, the saving account means an account of
amounts deposited in a bank for savings purposes.
Saving Account are generally opened for the savings of customers
(individuals, nonprofit organization, charitable trusts, clubs, associations and
cooperative) who want to save for meeting future needs, Savings accounts is suitable
for the customers who do not want to withdraw frequently or who do not want to keep
certain amount for fixed long period.

2.3 Research Gap

Various studies have been conducted in the past on financial analysis of
commercial banks in the US and other regions were found done. The research paper
done in the context of Nepal mainly emphasized on liquidity, profitability and
leverage of the commercial banks. These studies lack micro-level analysis and found
applying traditional analysis of financial performance. In the context of Nepalese
banking environment, there are few academic researchers found conducted in the
frame work. However these researches lack analysis of the component i.e Sensitivity
of Market Risk. This study attempts to evaluate financial performance of Himalayan
Bank Ltd and NABIL Bank Ltd..
 CHAPTER THREE
RESEARCH METHODOLOGY

3.1. Research Design

The research methodology is the process of arriving to the solution of the
problems through planned and systematic dealing with the collection, analysis and
interpretation of facts and figures. As the research entirely considers about the about
“Deposit Analysis of NABIL Bank” The main purpose of this study is to show
deposits and its utilization in NABIL with its financial positions, collection and uses
of funds, its prospects and its position in context of Nepal as well as to recommended
suggestions for its improvement. Those research methodologies have been used which
proves helpful to deposit analysis. For the purpose of achieving the objective, the
following methodology is used. The data has been collected by acquiring various
kinds or reposts, bulletins and journals from the organization. Similarly data has been
acquired from NRB also.
The study report is based mostly on secondary information of NABIL. In
addition to this, reference has been made in library consult, class lectures, Related
books of banking, financial management and accounting during the preparation of this
study.

3.2 Population and sample

The 28 commercial banks of the country Nabil Bank Ltd has been chosen and
their performances have been analyzed. Due to Lack of Penal access study mainly
depends on the balance sheet prepared by Nabil Bank Ltd, which is the secondary
source. Nabil Bank Ltd has been selected for the present study. Financial statement of
this bank for the last five years has been taken as the sample for this purpose.

3.3 Type of Data

For the preparation of this report different kinds of books are followed. In this report,
all the data collected is secondary in nature. Almost all the data has been collected
 form published annual reports, brochures etc. Mostly all the data are collected from
the concerned bank.

Secondary Data Source:

In this study, the main source of data is secondary which are collected from pre-
published data sources. The financial data from the published documents and audited
financial statements were manually extracted into the computer files of Microsoft
Excel program which acted as master database file. The data was refined further into
spreadsheetstocarry out financial ratio calculation and graphical illustrations through
mathematical functions and Chart program of the Excel program.

3.4 Data Processing Techniques

The data collected from the above stated sources has been classified tabulated
and interpreted for easier study. The data collected are classified, tabulated and
arranged in manner to make it easily understandable with the use of tables in
chronological order. After classification the data is tabulated.

3.5 Techniques of Analysis

Financial ratios are the major tools used for the descriptive analysis of
the study. In addition to the financial tools, simple statistical tools are also used.
Financial Ratio Analysis tools are used to determine the performance of the banks in
the framework components. These ratios are categorized in accordance of the
components. Following category of key ratios are used to analysis the relevant
components in terms.:

3.6 Limitation of the study

The study does not present detailed analysis of deposit in NABIL due to lack
of time relevant data and resources. This study is limited to the information that was
available from the bank and other sources.
· Annual reports of NABIL
· Annual reports of NRB
· This study only covers the data of five years only.
 CHAPTER –FOUR
RESULTS AND FINDINGS

4.1 Data Presentation and Analysis

Table 4.1
Total Deposit position of NABIL (Rs. in million)

Year Fixed Current Saving Others Call & Total Growth %

Short
Deposit
2013 2446 2704 4972 439 4945 15506 -2
2014 2252 3034 5230 390 2541 13448 -13
2015 2310 2688 5994 326 2801 14119 5
2016 2079 2799 7026 342 2341 14587 3
2017 3449 2910 8771 365 3851 19347 33
Source: NABIL Bank Ltd., Annual Financial Statement

Figure 4.1
Total Deposit position of NABIL (Rs. in million)
25000

20000

15000

10000

5000

0
2013 2014 2015 2016 2017

Total deposit
 This table shows the total and finger 4.1 deposit mix of NABIL during the
period of five years. During the last years the current, margin or other deposits have a
fluctuating collection in the deposit mix of NABIL. Here, total deposit on NABIL in
was Rs.15839 million which were 0.006% less than that of year 2003, in 2013 by 2%.
In the year 2014 the deposit decreased by 13%. But in the year 2015 the total deposit
increased by 5% to Rs.14,119 million. In the year 2016 the deposit increased by 3%
which reached to Rs.14,587 million .In the year 2017, the deposit increased by 33%
which reached to Rs.19,347 million.
Table 4.2
Current Deposit Position of NABIL ( Rs. In Million)

Year Current Deposit Growth (Rs.) Growth %

2013 2704 -148 -5
2014 3034 331 11
2015 2688 -346 -13
2016 2799 111 4
2017 2911 112 4
Source: NABIL Bank Ltd., Annual Financial Statement
Figure 4.2
Current Deposit Position of NABIL ( Rs. In Million)

Current Deposit
3100

3000

2900

2800
Current Deposit

2700

2600

2500
2013 2014 2015 2016 2017
 Above table and figure 4.2 shows that the current deposit of NABIL. In the
year was Rs.2,851 million, which was decreased by 1% than the previous year. There
had been great decreased in current deposit during the year by 1% corresponding to
Rs. 30 million. But there was a decrease in the year 2013 by 5% and the current
deposit reached Rs. 2,704 million during year . In the year 2013 current deposit was
Rs. 3,034 million which is Rs. 331 million more than that of year 2014. But in the
year 2015 current deposit collection decreased by 13% corresponding to Rs.346
million increases. In the year 2016 current deposit collection increased by 4%
corresponding to Rs.111 million increased. Now, in the recent year 2017, the current
deposit is increased by 4% i.e.Rs.112 million and has reached to Rs.2,911 million.

Table 4.3
Saving Deposit Position of NABIL (Rs. in million)

Year Saving Deposit Growth Rs. Growth %

2013 4972 55 1
2014 5230 257 5
2015 5994 765 13
2016 7026 1032 15
2017 8771 1745 25
Source: NABIL Bank Ltd., Annual financial Statement

Figure 4.3
Saving Deposit Position of NABIL (Rs. in million)

Saving Deposit
10000

8000

6000

4000 Saving Deposit

2000

0
2013 2014 2015 2016 2017
 Here is the figure of saving deposit of NABIL. In year it was increased by
18% and in the year 2013 it was increased by 5%. In the year 2014 saving deposit
waszRs.5,230 million which is Rs.257 million less than of year . In the year 2015 it
again increased by 13% and reached Rs. 5,994 million. In the year 2016 it again
increases by 15% and reached Rs. 7,026 million. In the year 2017, it continues to
increase and reaches to Rs.8,771 million which is the increase by 25% i.e. Rs.1745
million.
From the above table, saving deposit trend is seemed to be increasing. Most of the
people deposit their fund in saving deposit account. So, NABIL should attract people
towards saving deposit and manage its incremental trend.

Table 4.4
Fixed Deposit Position of NABIL (Rs. in million)

Year Fixed Deposit Growth (Rs.) Growth (%)

2013 2446 -1273 -2
2014 2252 -195 -9
2015 2079 -231 -11
2016 2079 -231 -11
2017 3449 1370 67
Source: NABIL Bank Ltd., Annual Financial Statement

Figure 4.4
Fixed Deposit Position of NABIL (Rs. in million)
 Fixed Deposit
4000
3500
3000
2500
2000
Fixed Deposit
1500
1000
500
0
2013 2014 2015 2016 2017

This above table and figure 4.4 shows the fixed deposit of NABIL. In the year
it again decreased by 106% to Rs.3719. But there was decrease in fixed deposit during
the year 2013. It decreased by 2% to Rs.2446. In the year 2014 it was increased by
9% and reached Rs.2252 million. In the year 2015 it was increased by 11% and
reached to Rs.2310. In the year 2016, it has again increased by 11% and reached to
Rs. 2079 million. In the year 2017, it has again increased by 69% and reached to Rs.
3449 million. Above table shows that the growth in fixed deposits it is rather
fluctuating. Since the fund of fixed deposit can be utilized for long-term investment, it
should be made consistent. So, such increase and drastic decrease affects the
profitability of the company.
Table 4.5
Interest Bearing Deposit Trend of NABIL (Rs. in million)

Year Interest Bearing Deposit Growth (Rs.) Growth (%)

2013 12363 -222 -2
2014 10022 -2341 -3p
2015 11106 1084 10
2016 11446 340 3
2017 16071 4625 29
Source: NABIL Bank Ltd., Annual Financial Statements

Figure 4.5 Interest Bearing Deposit Trend of NABIL (Rs. in million)

 Interest Bearing Deposit

2013
2014
2015
2016
2017

From table and figure 4.5 Interest bearing deposit of NABIL. In the year it
was increased year 2013 it again decreased by 2% to Rs. 12,363. But there was
decrease in interest bearing deposit during the year 2014 it decreased by 23% to
Rs.10,022. In the year 2015 it was increased by 10% and reached to Rs.11,106
million. But there was increase in interest bearing deposit by 3% in year 2016 and
reached to Rs. 11,446. In the year 2017, it has increased to 29% and has reached to
Rs.16,071 million.

Table 4.6
Non-Interest Bearing Deposit Trend of NABIL (Rs. in million)

Year Non-Interest bearing deposit Growth (Rs.) Growth (%)

2013 3142 -112 -3
2014 3424 282 8
2015 3012 -412 -14
2016 3140 128 4
2017 3276 136 4
Source: NABIL Bank Ltd, Annual Financial Statement

Finger 4.6
Non-Interest Bearing Deposit Trend of NABIL (Rs. in million)
 Non- Interest Bearing Deposit
3500

3400

3300

3200

Non- Interest Bearing Deposit

3100

3000

2900

2800
2013 2014 2015 2016 2017

In above table and figure 4.6 the non-interest bearing deposit of NABIL In the
Similarly during the year 2013 it was decreased by 3% and reached to Rs.3,142. In the
year 2014 it increased by 8% Rs. reached Rs.3,424 million. In the year 2015 the non-
interest bearing deposit decreased by 14% million which is corresponding to
Rs.3,012. And in the year 2016 the interest bearing deposit increased by 4% and
reached Rs.3,140. Now, in the recent year 2017, the non-interest bearing deposit has
increased by 4% and reached to Rs.3,276 million.

Table 4.7
Interest Expenses on Deposit (Rs. in million)

Year Interest on Total Deposit Rs. Ratio%

Deposit
2013 457 15506 2.94
2014 307 13448 2.28
2015 265 14119 1.88
2016 244 14587 1.67
2017 359 19347 1.86
Average 14.2
Source: NABIL Bank Ltd, Annual Financial Statement
 Figure 4.7
Interest Expenses on Deposit (Rs. in million)

Ratio%
15

10

0 Ratio%
15506

13448

14119

14587

19347

Average

457 307 265 244 359

2013 2014 2015 2016 2017

The table and figure 4.7 interest expenses on deposit are presented. In the year
2013 the total collection of deposit was Rs.15,506 while interest on deposit was Rs.
457 of the total deposit, which is 2.29% ratio. In the year 2014 total deposit and
interest of rate on deposit are Rs. 12,448 and Rs. 307, which is 2.28% of total deposit.
In the year 2015 the total collection of deposit was 14,119 while interest on deposit
was 265, which is only 1.88% of total deposit. In current year 2016 the collection of
deposit was 14,587 while interest on deposit was 244 which is 1.67%. In the year
2017 the collection of deposit was Rs. 19,347 million and interest on deposit
Table 4.8
Cost of Deposit of NABIL (Rs. in million)

Year Total Total Deposit Interest bearing Cost of

Deposit Expenses Deposit Deposit %
2013 15506 457 12363 3.7
2014 13448 307 10022 3.06
2015 14119 265 11106 2.4
2016 14587 244 11446 2.13
2017 19347 359 16071 2.23
Source: NABIL Bank Ltd, Annual Financial Statement
Figure :4.8
Cost of deposit of Nabil (Rs. in million)

20000
18000
16000
14000
12000 Series1

10000 Series2
8000 Series3
6000 Series4
4000 Series5
2000
0
Year Total Total Interest Cost of
Deposit Deposit bearing Deposit %
Expenses Deposit

Form the table and figure 4.8 year 2013 the cost of deposit was Rs.457,
which is 3.7% of total interest bearing deposit of Rs. 12,363. In the year 2013the cost
of deposit decrease slightly with decrease in deposit was 3.06% i.e. Rs.307 million
when the total interest bearing deposit is Rs.10,022 million. In the year 2014 the cost
of deposit decreased in deposit and it was 2.4% i.e. Rs.265 million when the total
interest bearing deposit is Rs.14,119 million. In current year 2016 total deposit is Rs.
14,587 million while a total deposit expense is Rs. 244 million and interesting bearing
deposit is Rs. 11,446 million. In the year 2017 total deposit is Rs. 19,347 million
while a total.deposit expense is Rs. 359 million and interest bearing deposit is Rs.
16,071 million and the ratio is 2.23%. Therefore, cost of deposit reached at 3%.

Table 4.9
Deposit Lending Ratio (Rs. million)

Year Total Deposit Total Loans And Advance Deposit Lending%

(Rs.) (Rs.)
2013 15506 7438 47.96
2014 13448 7756 57.67
2015 14119 8189 57.99
2016 14587 10586 72.57
2017 19347 12922 66.79
Average 59.26
Source: NABIL Bank Ltd, Annual Financial Statement

Finger 4.9
 Deposit Lending Ratio (Rs. million)

Deposit Lending%
80

60

40

Deposit Lending%
20

0
7438

7756

8189

10586

12922

Average
15506 13448 14119 14587 19347
2013 2014 2015 2016 2017

The above the table and figure 4.9 analyses shows the ratio of total loans and
advances to total deposits .During the year 2013 the deposit-lending ratio was 47.96%
of total deposit. The ratio decreased by 47.96% of total deposit in the year 2013 the
total deposit decreased but the loans and advances could be increased. Total loans and
advances in the year 2015 were 57.99% of total deposit corresponding to Rs.8,189. In
the year 2016, both total deposit and loan and advances has been increased. Therefore,
the deposit-lending ratio has reached to 72.57% of total deposit. In the year 2017 the
deposit-lending ration was again increased by 66.79% and reached Rs. 12,922.

Table 4.10
Ratio of Interest Bearing Deposit to Total Deposits (Rs. in million)

Year Interest bearing deposit Total deposit Ratio%

2013 12363 15506 79.73
2014 10022 13448 74.52
2015 11106 14119 78.65
2016 11446 14587 78.47
2017 16071 19347 83.07
Average 79.98
Source: NABIL Bank Ltd, Annual Financial Statements
 Figure 4.10
Ratio of Interest Bearing Deposit to Total Deposits (Rs. in million)

84
82
80
78
76
74
Series1
72
70
15506

13448

14119

14587

19347

Average
12363 10022 11106 11446 16071
2013 2014 2015 2016 2017

In the above table and figure 4.10, ratio of interest bearing deposit to total
deposits of NABIL, in the year was 79.45% of total deposits. But in the year 2013 it
was 79.73% corresponding to Rs.15,506. In the year 2014 both the interest bearing
deposit and total deposit decreased and the interest bearing deposit shared 74.52% of
total deposit of Rs. 10,022 million. It again decreased in year 2015 and the ratio was
78.65% of total deposit. In the year 2016 interest-bearing deposit is Rs.11,446
corresponding to Rs. 14,587 million by 78.47%. Now, in the year 2017, both the
interest bearing deposit and total deposit has increased. But the ratio reached to
83.07% of total deposit.

Table 4.11

Year Non-Interest bearing deposit Total Deposit Ratio%

2013 3142 15506 20.26
2014 3424 13448 25.46
2015 3012 14119 21.33
2016 3140 14587 21.53
2017 3276 19347 16.93
Average 21
Ratio of non-interest bearing deposit to total deposit (Rs. in million)

Source: NABIL Bank Ltd, Annual Financial Statement

Finger 4.11
Ratio of non-interest bearing deposit to total deposit (Rs. in million)

Ratio%
100%
90%
80%
70%
60%
50%
40%
30% Ratio%
20%
10%
0%
15506 13448 14119 14587 19347 Average
3142 3424 3012 3140 3276
2013 2014 2015 2016 2017

In the above table finger 4.11, ratio of non-interest bearing deposit to total
deposits of NABIL, in the year the ratio is 20.54 % of total deposits corresponding to
non-interest bearing deposit Rs.3,254.But in the year 2013 it was 20.26%
corresponding to Rs.3,142. Similarly in the year 2014 non-interest bearing deposit
shared 25.46% of total deposit Rs. 13,448 million. In year 2015 non-interest bearing
deposit shared only 21.33% of total deposit as only Rs.3,012 million was collected. In
the year 2016 non-interest-bearing deposit is shared only 21.53% of total deposit
corresponding to Rs.3,140. Now, in the current year 2017, it shared to 16.93% of total
deposit where non-interest bearing deposit and total deposit are Rs.3,276 and
Rs.19,347 million respectively.
Table 4.12
Ratio of current deposit to total deposit (Rs. in million)
Year Current deposit Total Deposit Ratio%
2013 2704 15506 17.44
2014 3034 13448 22.56
2015 2688 14119 19.04
2016 2799 14587 19.19
2017 2911 19347 15.04
Average 18.54
Source: NABIL Bank Ltd, Annual Financial Statement

Finger 4.12
Ratio of current deposit to total deposit (Rs. in million)

25

20

15

10
Series1
5

0
15506 13448 14119 14587 19347Average
2704 3034 2688 2799 2911
2013 2014 2015 2016 2017
 From the above table and 4.12, in the year current deposit contributed .In the
year 2013 current deposit was Rs.2,851, which is 17.43%. The current deposit
collection was Rs.2,704 million in 2014. In the year 2014 current deposit increased
and shared total deposit by 22.56%. The current deposit collection was Rs.3,034
million this year. In the year 2015 current deposit decreased to 19.19% the amount of
Rs.2,688. In the year 2016 current deposit increased to 15.04% where current deposit
and total deposit are Rs. 2,799 and Now in the year 2017 current deposit ratio was
increased by15.04% and reached to Rs. 2,911 million where total deposit was Rs.
19,347 million.
Table 4.13
Ratio of saving deposit to total deposit (Rs. in million)

Year Saving deposit Total Deposit Ratio%

2013 4972 15506 32.07
2014 5230 13448 38.89
2015 5994 14119 42.45
2016 7026 14587 48.17
2017 8771 19347 61.13
Average 42.3
Source: NABIL Bank Ltd, Annual Financial Statement

Figure 4.13
Ratio of saving deposit to total deposit (Rs. in million)
 70

60

50

40

30

20 Series1

10

0
15506 13448 14119 14587 19347 Average
4972 5230 5994 7026 8771
2013 2014 2015 2016 2017

From the above table and figure 4.13, in the year saving deposit contributed
total deposit by 31.04%. The saving deposit collection was Rs.4,917 saving deposit
Rs.4,972 million which was 32.07% of total deposit of Rs.15,506 million. In the year
2014 saving deposit Rs.5,230 million which was 38.89% of total deposit of Rs.13,448
million. In the year 2015 the saving deposit Rs.5,994 million which was 42.45%
of total deposit of Rs.14,119 million .Similarly, in the year 2016 saving deposit
Rs.7,026 million which was 48.17% of total deposit of Rs.14,587 million. And in the
year 2017, saving deposit has increased to 61.13% of total deposit. Here, saving
deposit and total deposit amounted to Rs.8,771 and Rs.14,347 million respectively.

Table 4.14
Ratio of Fixed deposit to total deposit (Rs. in million)

Year Fixed deposit Total Deposit Ratio%

2013 15506 15.77
2014 2252 13448 16.75
2015 23101 4119 16.36
2016 2079 14587 14.25
2017 3449 19347 17.82
Average 21.56
Source: NABIL Bank Ltd, Annual Financial Statement
 Figure 4.14
Ratio of Fixed deposit to total deposit (Rs. in million)

25

20

15

10
Series1
5

0
15506 13448 4119 14587 19347Average
2252 23101 2079 3449
2013 2014 2015 2016 2017

From the above table and finger 4.14, in the year fixed deposit contributed total
deposit by 48.41% where fixed deposit was Rs.3,719. It had reached to15.77 % in the
year 2006/2007. In the year 2014, the fixed deposit collection was Rs. 2252 when
total deposit collection was Rs.13448 and its ratio was 16.75%.Similarly, in 2015
fixed deposit contributed total deposit of Rs.14119 million by Rs.2310 million which
is 16.36% of total deposit. In the year 2016 fixed deposit contributed total deposit of
Rs.14587 million by Rs.2079 which is 14.25% of total deposit .Now, in the current
year 2017; fixed deposit contributed total deposit by 17.82%. Here, the fixed deposit
and total deposit amounted to Rs.3449 and Rs.19347 million respectively.

4.2 Data Analysis

None of the organizations is perfect in each and every way. I here are some
weaknesses and threats, which affect the organization’s performance. It may have lots
of strength to be proud of but besides with some weakness and threats as well. And
the organization does not remain same forever there will be lots of opportunities in
order to expand the transactions. So NABIL has also its strength to be proud, some
weakness to be recovered and threats to be faced patiently.

4.3 Major Findings

· Interest expenses on deposit of NABIL are also quite high but there has been a
decreasing trend of interest expenses till the year 2017.
· Similarly, the cost of deposit during the year 2017 is also quite high but there has
been decreasing trend in the later year. So, it helps to increase the efficiency to bank.
· By the analysis of deposit landing we can conclude that the bank is able to utilize
its deposits a greater extent.
· Thus, the bank’s performance is effective in profitability and towards the
customers and may attract more customers.

CHAPTER - THREE
 DISCUSSION, CONCLUSION

5.1. Discussion
A bank is an institution, which deals in money. A bank is like a reservoir. It draws
surplus money from the people who save and lend them to the people who want to use
it for productive purpose. In this process the bank earns commission. The rate of
interest paid to the depositors is generally lower than the rate charged to the
borrowers. The difference between these two rates of interest is the profit of the bank.
Deposit collection is the main function of commercial bank. The present study has
been undertaken to examine and evaluate the financial performance of NABIL. The
financial statements of five years that is from 2000/01 to 2004/05 have been examined
for the purpose the study. The study has resorted mainly to secondary data that has
been first processed and analyzed comparatively. Individual interview with the
management personnel has been taken whenever necessary. This study is exploratory
as well as analytical sometimes. NABIL was established in 12th July 1984, which was
the first joint venture bank in Nepal. Among many joint venture banks, it is a leading
one, which is always running in profit due to its proper management and good
policies. Data that I have presented is all from the secondary sources, which are in the
annual reports or other printed matters. A customer can be account holder when he
opens account. There are the numbers of rules and procedures regarding opening
different types of accounts. The interest rates on different accounts are different

5.2. Conclusion
· The deposit of NABIL is in increasing trend. The share of fixed deposit is more
than that of savings, current, margin and other deposits in the deposit mix of NABIL.
· The trend of interest bearing deposit has been gradually increasing but there has
been more fluctuation in non-interest bearing deposits, similarly, there is also more
fluctuation in interest expenses on total deposits.
· The trend analysis shows that the deposit of NABIL is in increasing trend. In
addition to this, the bank is being able to satisfy its customers and in providing higher
quality and newer services to them.
· Although NABIL has a strong financial base and capital structure as well as good
market status and reputation in order to attract new customers and increase deposit
collection NABIL should introduce new schemes.
· Customer services should be diversified and should further be accommodated.
· Interest rate on deposit should be competitive with other commercial banks.
· The bank should aim towards increasing its customers but it must also provide the
quality services to the present customers. For this the bank must make plans and
policies keeping customers in mind.
· Bank should also pay attention towards the priority sector and industrial sector for
lending loans to develop the economic condition of the country.
Bank should provide more facilities to the staff, it has to provide job satisfaction,
training and should encourage its staff .
 REFERENCE

Annual Report of NABIL from 2013 to 2017

Brigham, Eugene F., “Fundamental of Financial Management”, Holt Rinchtand
Winston: The Dryden Press, 1998.
Ghimire, Shiva Raj (2011) “Fundamentals of Investment”: Kathmandu:
Khadka, Sherjung. (2011), “Banking and Insurance”. Kathmandu: Asia Publication.
Khan, M.Y. and Jain P.K., “Management Accounting”, New Delhi: McGraw Hill
Publishing Co. Ltd.
Khan, M. Y. and P.K., “Financial Management Policy”: New Delhi: McGraw Hill
Publishing Co. Ltd., 1978.
Pradhan, Radhe S (2009). “Financial Management”:Kathmandu: Buddha Academic
Enterprises Pvt.Ltd: Nepal
Shrestha, M.K. and Bhandari, D.B (2010), “Financial Markets and Institution”.
Asmita Publication, Bhotahity, Kathmandu.
Singh, H.B. (2008), “Banking and Insurance”. Kathmandu: Asia Publication.
S.P. Gupta,”Statistical Method”.
Tiwari, Drona Prasad (2008). “Business Statistics”: Chabahil: Srijana Books
Publishers and Distributors
Van Horn James C.,”Financial Management Band Policy”: New Delhi Prentice Hall
of India Pvt. Ltd., 1986.
Van Horn James C.,”Fundamental Financial Management”: U.S.A. Prentice Hall
Inc. Engle Wood Cliff, 1983.
 Appendix A

Part A: Interview Questions

This report is group to be used only for:

Participants of respondent:

Name: Age:

Qualification: Occupation:

Gender Address:

Telephone No.:

Questionaire:

1. When was the organization established?

Ans: ………………………………………………………………………

2. Do employees get facilities?

( ) Yes ( ) No

3. How many employees are working at present?

Ans: …………………………………………………………………….

4. What is the profit at current year?

Ans: ……………………………………………………………………

5. Is advertising done?

( ) Yes ( ) No

6. Which software they prefer in this organization?

Ans. ……………………………………………………………………

7. What was the current deposit of this bank?

Ans: ……………………………………………………………………