It Nib

An Internship Report on Banking Sector, Focus on NIB Bank Limited
PURPOSE OF STUDY
It is necessary for the students of Master that they should be acquainted with the practical applications of their studies and should gain experiences. In this connection every student is required to undergo a practical work known as Research Monograph study in any specific topic of a field in any organization.
he !ain purpose of this study is to fulfill the practical require!ent of the Masters of "usiness #d!inistration degree.
his study offers practical knowledge and experiences of courses studied. o write whole experience in a syste!ic and in an organized way under the supervision of learned teachers and professors.
o i!prove the writing and analytical skills a!ong the students.
Research Monograph
Muhammad Faraz Ali Khan
Research Monograph
INTRODUCTION
This Research Monograph examines the general impact of Information Technology (IT on the !an"ing industry# The !an"ing industry has introduced $arious ne% customer ser$ices and products using IT# The !an"ing industry has gone through many changes as a result of the introduction of IT# In fact& the structure of the industry is continuously changing !ecause of rapid de$elopment of IT# The continued success of IT applications means that the limitations of current IT computer systems in !an"s ha$e to !e re!oust#1 In the research& the !an"ing industry has demonstrated a fair amount of competence in the application of IT# 'ome !an"s %ere at the cutting edge of IT and ha$e a clear $ision of ho% IT could !e furthered applied successfully# (an"s ha$e spent millions of rupees on IT e$ery year in a !id to fully automate its operations and ser$ices to customers# The industry recognizes that IT %as a ma)or "ey to its de$elopment# The research !rought to light the fact that IT has increased competition %ithin the industry# The realizations that the mar"et size is not really increasing has made !an"s more competiti$e# Also& the expectation of their customers is $ery high and in response !an"s using IT to satisfy the demand for *uality ser$ices and products# +o%e$er& there is an increasing outside threat to the !an"ing industry from the non,!an"ing sector# -eregulation of the !an"ing industry has introduced more competition !ut the lo% cost of computer technology has made it easier to enter the industry# .on,!an"s can no% pic" up off the shelf IT solutions for the ser$ices they %ant to pro$ide# The research re$eals that traditional !an"s find it difficult to integrate ne% computer technology %ith their old systems# As a result& their IT costs are higher than expected and IT integration ta"es to much time#
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1.1 INTRODUCTION TO BANKING

"anking as a syste! arose si!ultaneously with the use of notes. $otes have co!e into use in the seventeenth century in %ngland when !any people held heir wealth in gold. &uring the civil war' people were frightened of being robbed so they had to look for so!eone who had a safe vault for his own business and then to ask hi! to keep their gold in his safe. he obvious choice was the local golds!ith who had a safe vault available in which he kept his gold coins and bullion ("ullion is the na!e of given to uncoined refined gold and silver' generally in the shape of bars of bricks). *o it ca!e about that golds!ith took these deposit for safe keeping on charge of a fee and issued a receipt which acknowledge the deposit of !oney and incorporated a pro!ise to return it on de!and. More and !ore people ca!e to hold these receipts. hus' the original purpose of the receipt beca!e obscure as its function as pro!issory note + a note which pro!ises to pay + beca!e all i!portant. In ti!e people stopped calling the! receipts and began to describe the! as notes. golds!iths e!erged the first banks. hus' the
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1.2 ETYMOLOGY
It has not so far been decided as to how the word ,"ank- originated. *o!e authors opine that this word is derived fro! the words ,"ancus- or ,"anque- which !ean a bench. .ther authorities hold the opinion that the word ,"ank- which !eans ,/oint stock fund-. 0ater on' when the 1er!ans occupied !a/or part of Italy' the word ,"ackwas Italianized into ,"ank-. It is' therefore' not possible to decide as to which of the opinions is correct' for no record is available to ascertain the validity of any of the opinions. (2ractice and 0aw of "anking in 2akistan) "anking is indicated as pri!itive as hu!an society for ever since !en ca!e to realize the i!portance of !oney as !ediu! of exchange. oday the word ,"ank- is used as co!prehensive ter! for a nu!ber of institutions carrying on certain kinds of financial business. In practice the word ,"ank- !eans' this borrows !oney fro! one class of people and lends to another class of people for interest 3 2rofit.
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1.3 TYPES OF BANKS

2ri!arily all banks gather te!porarily idle !oney for the purpose of lending to others and invest!ents which bring gain in the for! of return' profit and dividends etc. 4owever' due to the variety of resources of !oney and the diversity in lending and invest!ent operations' banks have been placed in various categories' such as co!!ercial banks. *aving "anks' Merchants "anks' Mortgage "anks' 5onsu!er "anks' Invest!ent "ank' &evelop!ent "anks' 5ooperative "anks and 5entral "anks.
1.4 COMMERCIAL BANKS

he co!!ercial banks receive deposits fro! the general public which are repayable on de!and upon written orders of the depositors. #s their !ost distinctive feature the co!!ercial banks !aintain checking accounts for the constituents. he co!!ercial banks are also distinguished for providing short ter! finance to trade' co!!erce and industry to enable these sectors to expand their productive activities.
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1.5 MERCHANT BANKS

Merchant banks are those which have been !ainly financing the do!estic and international trade in 6nited 7ingdo!. &uring the late eighteenth and early nineteenth centuries the trade between countries was financed by bills of exchange by well reputed !erchant houses for which they would charge a co!!ission for their service. hus the business of accepting bills of exchange to finance the trade developed and gradually these business houses entered into other banking activities and beco!e known as !erchant banks. *ince all the co!!ercial banks' in addition to other banking functions' also deal in trade financing' the ter!- !erchant banks- has gradually faded away.
1.6 SAVING BANKS

he basic purpose of these banks is to inculcate the habit of saving in the people. he saving bank deposits are not repayable upon only the written orders of the depositor but the depositor or his agent has to appear personally at the saving bank to !ake withdrawal' and for this purpose he !ust present a pass book' a certificate of deposit or so!e si!ilar docu!ents to prove his right to receive pay!ent. 2ost .ffice *aving "anks and *aving #ccount at $ational *aving .rganization are well known operational *aving "anks in 2akistan.
1.7 MORTGAGE BANKS
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hese banks !ainly deal in loans for the acquisition or construction or real estate against the security of !ortgages. 8uite a few such banks are operating in developed part of the world. *aving and loans associations and far!9loan associations are so!e of the well known for!s of the !ortgage banks.
1.8 CONSUMER BANKS

hese banks provide finance for purchasing consu!ption goods for the use of the borrowers. 5onsu!er finance co!panies' sales finance co!panies and credit unions are so!e of the popular for!s of consu!er banks.
1. INVESTMENT BANKS
he invest!ent banks assist business houses and the govern!ental bodies to raise !oney through the sale of stock and bonds for usually long ter! purposes. hese banks perfor! the usual functions of raising deposits of idle !oney fro! the public and finance the business houses and other bodies.
1.1! DEVELOPMENT BANKS

hese banks have been established to provide long ter! develop!ent finance to the trade' co!!erce and industry. In 2akistan they are generally govern!ent owned banks' established under a specially pro!ulgated law. :arai develop!ents bank. araqiati "ank 0td. and Industrial &evelop!ent "ank of 2akistan is every well9known
1.11 COOPERATIVE BANKS

hese are the banks established and registered as a cooperative venture to provide banking facilities to the !e!bers of the cooperative. In 2akistan' the ;ederal "ank of 5ooperatives is well known such bank.
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1.12 CENTRAL BANKS

5entral banks occupy unique position in the banking structure of a country because they have been entrusted with the responsibility of controlling the !oney supply' interest rates and financial !arket of the country for the purpose of econo!ic develop!ent. *tate "ank of 2akistan' "ank of %ngland and ;ederal Reserve "ank of 6.*.#. are well known central banks. (2ractice and 0aw of "anking in 2akistan).
1.13 ORIGIN OF BANKING SYSTEM IN PAKISTAN

#t the ti!e of Independence' the areas which now constitute 2akistan were producing only food grains and agricultural raw !aterial for Indo92akistan subcontinent. here were practically no industries' and whatever raw !aterial was produced was being exported fro! these areas. 4owever' co!!ercial banking facilities were provided fairly well here. he history of banking syste! in 2akistan dates back to independence of 2akistan in #ugust <=>?' when various banks transferred their 4ead quarters and funds to areas likely to fall in India. his trend e!erged due to do!inate rule of 4indus in pre partitioned Indian "anking syste!. here were @>=A branches of Indian scheduled banks in the undivided sub9continent as on < st March <=>?' out of which only >B? branches were located in areas presently constituting 2akistan. 4owever' the nu!ber of branches of schedule banks drastically declined to <=C fro! >B? i!!ediately after partition. #t the ti!e of partition' there were only two banks having the honor to the first co!!ercial banks of 2akistan' na!ely 4abib Research Monograph 5 Muhammad Faraz Ali Khan
"ank 0td' which was setup in <=>< with its 4ead in India and #ustralia "ank 0td.' which was established in <=>> with its 4ead office in 2akistan. ;ollowing the partition' an expert co!!ittee was setup and this co!!ittee reco!!ended that the reserved bank of India being the 5entral bank of undivided India should continue to function as 5entral "ank of 2akistan and the Indian 5urrency notes would continue to be legal tender in 2akistan till @D th *epte!ber <=>B. *ubsequently it was decided to have separate central banks and the *tate "ank of 2akistan (*"2) was setup and started functioning fro! < st Euly <=>B. hus the 4istory of banking syste! in 2akistan started with the established of the (*"2) was inaugurated by 8uidDe9#za! Muha!!ad #li Einnah on < st Euly <=>B. 5onsequently' three banks were established which include Musli! 5o!!ercial "ank for!ed in *epte!ber <=>B' "ank of "hawalpur in .ctober <=>B and $ational "ank of 2akistan in <=>=. 4abib "ank also transferred its 4ead office fro! "o!bay to 7arachi' due to portioned in #ugust <=>?' and it was assisted by *"2 to finance do!estic trade of country. re!ained unchanged up to five till <=CC. he nu!ber of 2akistan scheduled he *tate "ank allowed the bigger
banks to open any nu!ber of branches. "y the end of &ece!ber <=?@' the total nu!ber of 2akistani scheduled banks increased to <@. #fter the nationalization of co!!ercial banks in <=?>' five !a/or banks e!erged to be !ain co!!ercial banks' branches exceeded A?DD in <=BC. In early <==D-s the 1overn!ent of 2akistan has also established ;irst Fo!en "ank to encourage wo!en for !aking saving and invest!ents' to provide the! !ore /ob opportunities and to seek their active partition in the develop!ent of national econo!y. In the hope that banking would enter a new era of further develop!ent and progress' "anks $ationalization #ct' <=?>' was pro!ulgated and 2akistani 5o!!ercial banks were nationalized in 2akistan since Eanuary D<' <=?>. It has now been realized that this step has proved counter productive' hence reversal has been initiated since Eanuary <==<' after a!ending the relevant laws. "esides disinvest!ent and privatization of nationalized co!!ercial banks' establish!ent of co!!ercial 16 Research Monograph Muhammad Faraz Ali Khan
and other banks in private sector has also been encouraged. 5onsequently' a large nu!ber of co!!ercial and other banks have co!e into operation since <==G' in private sector' offering co!petitive pro!pt' as also courteous and efficient service to the constituents.
# new concept of interest free banking was introduced in <=B< and by now it has been established on sound footing' and new trends and techniques are being i!ple!ented to !ake this syste! result oriented. %lectronic banking and several other new services like # M' *FI; ransfers'
5redit and 5harge 5ards etc' have been !ade available and their syste!atic consu!ption is !aking 2akistani banking co!parable to their several !odern counterparts anywhere in the developed world. &ece!ber G?' <==@ as a public li!ited co!panies ordinance' <=B> and received license fro! the *tate "ank of 2akistan to undertake and carry on the business of "anking in 2akistan on #pril @' <==>.
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INTRODUCTION OF NIB BANK LTD
2.1 HISTORY OF NIB BANK LIMITED

$I" "ank is fastest growing financial power house in 2akistan. $I" "ank 0i!ited was incorporated in March + GDD@ as a 2ublic 0i!ited 5o!pany. In .ctober + GDD@' all assets and liabilities and all rights and obligations of the for!er $ational &evelop!ent 0easing 5orporation ($&05) + .ne of the leading leasing co!pany in 2akistan and 2akistan operation of I;I5 "ank of "angladesh were a!alga!ated with and into $I" "ank 0td. In #pril + GDD>' $I" "ank also acquired the 2akistan operations of 5redit #gricole Indosuez. he growth story of $I" "ank is a unique one. In a short span of four years' $I" "ank is proudly serving nearly half a !illion custo!ers through wide distribution footprint across !ore than AD s!all and large cities of 2akistan. "eco!ing the ?th largest bank in 2akistan is /ust one di!ension of our growth story. he co!!it!ent of $I" "ank-s share holder can also be gauged through its enor!ous paid9up capital of our Rs.>D.DDD "illion' ;irst larges paid up capital in 2akistan banking industry. 5learly these are the reasons for your confidence in banks robustness. *ingapore. he $I" "ank 0td. acquire !a/ority share holding of 2I5I5 and full control of 25"0 in Eune GDD?. $I" "anks acquisition of 2I5I5 is one of the largest foreign invest!ent in 2akistan banking industry and great !ilestone in local financial sector. 2rincipal share holding of $I" "ank will continue to be with 4olding Invest!ent ar! of 1overn!ent of *ingapore. e!asek he !a/ority shareholder is with e!asek 4oldings of
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*ince <st of Eanuary GDDB $I" "ank 0i!ited providing its services in financial sector as .ne "ank .ne ea! with all operations of 25"0 and 2I5I5 Merged under $I" "ank 0i!ited as a ?th largest bank in 2akistan along with G>D "ranches' >CD'DDD 5usto!ers' Rs.<=? "illion otal #ssets' Rs.>D.DDD "illion 2aid9up 5apital.
2.2 "HAT IS TEMASEK HOLDING

# e!asek holding is the invest!ent ar! of the 1overn!ent of *ingapore which owns and !anages *ingapore 1overn!ent-s diversified direct invest!ents in *ingapore and overseas worth over 6*H <@> "illion. It is rated ,###- by *tandard I 2oor and ,#aa- by Moody-s. e!asek 4oldings is a !a/or shareholder in co!panies ranging fro! banking and financial services to ports' shipping and logistics' airlines' teleco!!unications and !edia' power' utilities and rail services' as well as phar!aceuticals and biosciences. *o!e of the pro!inent ownerships of #uthority of *ingapore. e!asek 4oldings include *ingapore el and 2ort #irline' &"* "ank of *ingapore' *tandard 5hartered bank' *ing
hrough its directly and indirectly owned subsidiaries
e!asek 4oldings has begun to increase its invest!ents in the #sian "anking and ;inancial *ector' Invest!ents also include stakes in bank &ana!on Indonesia' "ank International Indonesia' I5I5I "ank in India' 4ana "ank of 7orea. e!asek 4olding exposure to 2akistan has recently increased tre!endously' with *ing el acquiring a substantial stake in Farid eleco!!unication 0i!ited and port authority of *ingapore securing a long ter! !anage!ent contract of 1wadar 2ort.
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#s one of the fastest growing banks in 2akistan' we would like to assure you that there will be no interruption to the service you are currently en/oying and it will be the sa!e friendly faces serving you. #s $I" "ank' we look forward to serving you even better with new and enhanced products and services. Jou will have the benefits of reaching us with ease through any of our G>D branches' in !ore than AD cities across 2akistan. $I" "ank will provide you the benefit of transaction ease through the ?th largest distribution network of the country and a network of !ore than <DD # M-s across 2akistan.
2.3 MISSION OF NIB BANK LIMITED

o beco!e the bank9of9choice for the !ost discerning seg!ents of the corporate and consu!er !arkets in 2akistan. Fe will e!ploy state of the art technology and co!!unications syste!s to deliver financial services that are innovative and affordable' and which will allow our custo!ers to transact conveniently and efficiently.
2.4 VISION OF NIB BANK LIMITED

o be a pre!ier financial institution of international standard and repute' offering innovative value9added products and services' tailored receptively to the custo!erKs needs and satisfaction' while opti!izing the shareholdersK value through !eeting their expectations' !aking $I" an Linvestor preferred institutionL a!ply /ustifying its clai!s of a Lfinancial super!arketL by catering all financial needs of the custo!ers under one roof.
2.5 CREDIT RATING

5redit rating agency' 2#5R#' is currently in the process of evaluating the i!pact of the !erger of the 2I5I5 and 25"0 with and into $I" "ank 0i!ited. Research Monograph 11 ill the
co!pletion of the review' the rating assigned to $I" of long ter! #M and short ter! #< re!ain on Rating Fatch' with positive i!plications.
2.6
ORGANI#ATIONAL GOVERNANCE OF NIB BANK
STRUCTURE$CORPORATE
$I" "ank 0td is !anaged by a "oard of &irectors with representation e!asek 4oldings shareholders. he "oard of &irectors' which is the highest policy !aking body of $I"' consists of eight directors. . he "oard deals with all policy !atters and applications involving financial assistance up to the !axi!u! lending li!it' accordingly to $I" total net worth both in foreign and local currencies. assistance. &irectorsN Mr. ;rancis #ndrew Rozario Mr. Mah!udul huq "huiyan Mr. syed #a!ir :aidi Mr. ho!as 2atrick *odano Mr. an *oo $an Mr. Fillie Fai 7ong 5han Mr. 2hua 7ok 7i! Mr. 7hawa/a Iqbal 4assan Research Monograph 12 Muhammad Faraz Ali Khan he "oardKs %xecutive 5o!!ittee' co!prising of eight &irectors' he following gentle!en presently co!prise $I" "ank ltd "oard of deals with !atters other than those involving policy and applications for financial
2.7
MANAGERIAL CHART
$I" is equipped with very strong and experienced hu!an resource structure consisting of financial3 invest!ent analysts' !arketing experts3econo!ists' engineers' chartered accountants' cost accountants' financial accountants and legal experts. $I" has traditionally been hiring individuals fro! renowned educational institutions and professionals with rich work experience so as to have a superior blend of experts and strategists to !anage the affairs of the 5orporation. $ib-s staff turnover is co!paratively low which shows the co!patibility of its co!pensation policies for holding co!petent work force according to their professional caliber. $I" continues to pay special e!phasis on the training of its professional staff and avails to the !axi!u! possible extent the training opportunities offered by the Forld "ank' #&"' #&;I#2' #&;IMI' etc. along with training progra!s available within 2akistan.
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2.8 ORGANIZATIONAL CHART

7rganizational chart is a diagram that represents the positions 8 relationship %ithin an organization that re$eals the company9s organizational structure###
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:resident ; <=7
>roup ?eader
<luster Manager
Manager
Relationship Manager
-ate <enter Incharge
7peration Manager
:ersonal (an"ing <onsultant
<ounter 'er$ice 'uper$isor <ounter 'er$ice 7fficer (ranch 'er$ice 7fficer
2. GOAL OF NIB BANK

$I"' after turning the corner' is now destined to revive its glory through dyna!ic business activity which includesN Research Monograph 15 Muhammad Faraz Ali Khan
%nhancing Recovery of 0oans. Resource Mobilization for .n90ending. Revival of *ick 6nits. .ut .f 5ourts *ettle!ent %ven In he 5ases 6nder 0itigation ;und Manage!ent #nd %xpanded Merchant "anking .perations. 1rowth in 0ease ;inancing. Fith all such activities' $I" has started to earn sizable profit' and has started to pay dividend to its shareholders $I" has ree!erged as a viable financial super!arket. he scope of $I" financing which was previously confined !ostly to providing long ter! foreign and local currency assistance for setting up industrial ventures has been further expanded to enco!pass provisions of other credit facilities and services. 5o!!ensurate with the growing co!petitive business environ!ent' through the acquisition of a co!!ercial bank.
$I" has realized that in order to !eet the challenges of future especially the hird Millenniu!' $I" needs to diversify fro! its 26 traditional role of provider of subsidized credits to sub9borrowers.
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Realizing this $I" is diversifying itself with the changing financial and operational scenarioO it has to read/ust itself into a financial institution which covers a wide variety of business operations. Fith the privatization process in vogue and develop!ent of a free !arket econo!y' the rules of business are substantially changing. he era of subsidized credits has been substituted with real !arket forces requiring effective and efficient ability to conduct into the new business order. $I" is presently exploring the possibilities of new business areas as part of its diversification plan.
2.1! PARTNER IN GLOBAL AGENDA

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#s a !e!ber of Forld co!!unity of develop!ent partners' $I" is also deeply concerned with international agenda like %nviron!ental 2rotection. $I" is keen in pursuing to aug!ent efforts in this direction. ;or the purpose of environ!ent protection specially in the area of industrialization process where environ!ental threats are !ore co!!on in the shape of air and soil pollution and threat to hu!an health. $I" is also concerned with the increasing global realization of quality standards. $ib-s lending policy is being further i!proved to support industrial production process in confor!ity with the I*. standards. $I" it self is keenly interested in following a path which leads to its I*. certification as a financial institution in near future.
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NIB BANK CORE BANKIG APPLICATION MODULES
3.1 MARKETS % PAYMENT SYSTEM
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Markets & Payment Systems
R=TAI? @+7?='A?=(<orporate F7R=I>. =A<+A.>= MARK=T <7MM7-ITI=' MARK=T <A:ITA? MARK=T M7.=B MARK=T
TRA-I.>
-=A? MAKI.>
(CB=R
-=?ID=RB
'=??=R
-=A? -=<I'I7.
:ABM=.T
I$* I 6 % ;.R &%P%0.2M%$ #$& R%*%#R54 I $ "#$7I$1 %54$.0.1J
INFRASTRUTURE
-=?ID=RB 'B'T=M(' , 7@.=R'+I: TRA.'F=R
:ABM=.T 'B'T=M ('
*epte!ber <G' GDDG
P. 2. 160# I
.2 Chang!ng Face o" #an$!ng #%s!ness

Research Monograph 20 Muhammad Faraz Ali Khan
<le arin g
(A .K '
8' ettle
MARK=T,R=?AT=- TRA-=,R=:7RTI.> 'B'T=M('
men t
:roducts and ser$ices =mergence of ne% deli$ery channels <on$ergence of core !an"ing !usiness and information technology Mergers 8 ac*uisitions .e% ser$ices (Tele,!an"ing& = !an"ing& door step !an"ing and ne% approaches to !an"ing (automated self !an"ing centers
<ore !an"ing <ustomer relationship management <C> net%or"s Kios"s ; ne% deli$ery channels Ris" management @ireless Technologies
'mart cards -ata <entre ; -M ; -@ <all <entre;+elp -es"s Resource management Internet ; electronic !an"ing
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3.3 NIB BANK S&'()& L*+,- B&./&&+ E0*-.*+1 A+2 N&/ T&'3+45416 P57.84)9-
$I" "ankQ2akistan ?th9largest co!!ercial bank99values the ability to !aintain security while !aking !ainfra!e data accessible across an open client3server network. $I" "ank today has G>D branches in 2akistan. It takes a progressive approach to infor!ation technology' and has created a truly distributed client3server environ!ent with the .pen *oftware ;oundationKs &istributed 5o!puting %nviron!ent (&5%) providing the secure connections. $I" "ank was already using teleco!!unications in the <==C to boost its back office operations. In the GDDD' the focus shifted to the front office' and the need to give !ore autono!y to the branches. L#s a result' $I" !oved to a for! of distributed co!puting in which local branches could service BDR of their own needs. hey only contacted the !ainfra!e to store and forward transactions' or to execute exceptionally large transactions.L "ecause of the synergy between the various $I" "ank co!pany syste!s' the bank wanted to incorporate existing equip!ent as far as possibleN LFith the infrastructure in place' $I" are now changing applications that are <D or <C years old to the new &5% environ!ent' and testing the various types of transactions99 !any of the! running under PIBAS .L
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3.4 B7+,*+1 +&./4),
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NIB :7+, banking application can be access around its G>D branches through out 2akistan though dedicated network link (through 2 50 &*0 service ' Fi!ax technology by Fateen eleco! ' 5yber network I*2 .as whole network is centralized.
S&'()*.6 S&);*'&-
provide $I" "ank with security tighter than is possible with conventional passwords. &5% entrusts security not to the client or the server' but to a Lthird partyL99a dedicated and physically secure &5% security server. his server controls three security processesN
Authentication' to identify both the client and the server. his involves a co!plex process of encrypted tickets' and thus avoids the exposure of sending passwords over the network. 24 Muhammad Faraz Ali Khan
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Authorization' which deter!ines whether that client has the right to access the resources it is requesting (the server holds access control lists). Encryption' based on the &%* encryption algorith! that enables an organization to choose various levels of security up to full encryption with all data encoded. hese processes are hidden fro! users. #ll they see is a si!ple !eans of using one password and one userna!e to gain access to any data to which they are entitled' anywhere on the network' without having to ask for access to individual networks and servers.
3.5 H4/ NIB B7+, P57+- T4 B&+&8*.
5entrally9held infor!ation and data will be !ore easily available to authorized users anywhere in the network "ranch staff can be !ore effective through being able to access co!!ercial infor!ation and better9quality services and facilities ight security through a dedicated security server and unique user I&s Infor!ation is consistent at every site because &5%Ks global file syste! holds only one logical copy of a file for the whole network &5%Ks true open syste!s environ!ent offers the flexibility to incorporate the bankKs existing !ulti9vendor syste!s' and add to the network as required in the future #d!inistration and !anage!ent can be reduced because changes need only be !ade once at a single point for distribution across the whole network.
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&ro'ec'!on Aga!ns' Sec%r!'( Threa's
4.1 Protecting Online Banking from Security Threats.

5 Essential Components of Online Banking Security
oday' all !a/or banks offer online baking services to their custo!ers. hey also have taken !any steps by adding security features to the service infrastructure' such as !easures to prevent identity theft and fraud so that online banking is a safe and secure experience. 4owever' as !ore custo!ers depend on a reliable online access' there are steps to take against new types of online threats. 1reat &isasters happen' not because people run risks' but because they don-t understand the risks.
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Ho come the Cy!er attack in "#B #T infrastructure stoppe$ !y fire alls an$ the #nternet Ser%ice Pro%i$ers
Denial of service (DoS) attacks and Distributed Denial of Service (DDoS) attacks are very difficult to stop using firewalls because the content is legitimate and the intent is malicious. Most ISPs for online banks do not have ade uate tools and techni ues re uired to stop the onslaught. !hey can simply take down the network " which furthers the purpose of the attackers.
Comprehensi%e Online Banking "et ork Protection

&eature DDoS M!'!ga'!on F!re)a** Content Base$ Security '#PS( F*oo+s ,S-N. TC&. UD&. ICM&. Frag/en'. &or'. e'c.0 #o'ne' A''ac$s So%rce Trac$!ng. So%rce L!/!'!ng Bes Bes Bes .o .o .o .o .o .o Bes Bes Bes .o .o .o .o .o .o .o .o .o .o .o .o Bes Bes Bes .o .o )e! *pplication Security '*pplication &ire all( .o .o .o .o .o .o .o .o .o .o .o Bes Bes
Con'!n%o%s #eha1!or Learn!ng an+ A+ap'!1e Con'ro* Bes Hea+er an+ S'a'e Ano/a*!es &or' Scans. Ne')or$ Scans. Dar$ A++ress Scans ACLs NAT S'a'e"%* Inspec'!on S'a'e"%* S!gna'%res Tra""!c S!gna'%res Cross S!'e Scr!p'!ng. &ara/e'er Man!p%*a'!on. Co//an+ In2ec'!on In"or/a'!on Lea$age Bes Bes Bes .o .o .o .o .o .o
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# comprehensive security plan for security includes both network security and application security plan.
4.+
*rchitecture of "#B B*", Secure Online Banking "et ork
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RESEARCH METHODOLOGY
he goal of the research process is to produce new knowledge' which takes three !ain for!s

%xploratory research' which structures and identifies new proble!s 5onstructive research' which develops solutions to a proble! %!pirical research' which tests the feasibility of a solution using e!pirical evidence
Research can also fall into two distinct typesN

2ri!ary research *econdary research
In social sciences and later in other disciplines' the following two research !ethods can be applied' depending on the properties of the sub/ect !atter and on the ob/ective of the researchN

8ualitative research 8uantitative research
Research is often conducted using the hourglass !odel *tructure of Research. he hourglass !odel starts with a broad spectru! for research' focusing in on the required infor!ation through the !ethodology of the pro/ect (like the neck of the hourglass)' then expands the research in the for! of discussion and results.
E0<54)7.4)6 R&-&7)'3 M&.342

%xploratory research provides insights into and co!prehension of an issue or situation. It should draw definitive conclusions only with extre!e caution. Research Monograph /0 Muhammad Faraz Ali Khan
%xploratory research is a type of research conducted because a proble! has not been clearly defined. %xploratory research helps deter!ine the best research design' data collection !ethod and selection of sub/ects. &uring this research pro/ect report on $I"' I have used E0<54)7.4)6 R&-&7)'3 M&.342.
S4()'&- 48 27.7
<. 2ri!ary data G. *econdary data 1. P)*97)6 27.7 2ri!ary data' which I have personally collected during !y internship period at $I"' fro! sources like interviews and discussions with bank staff and !anage!ent personnel' personal observation and doing work !yself. 2. S&'4+27)6 27.7 his data is collected by annual reports of bank /ournals and brochures published by $I" "ank' also collected necessary infor!ation fro! banking related books' !agazines' newspapers and "ank website.
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LIMITATIONS
&uring this research the following difficulties have been experienced by the internee. T*9& L*9*.7.*4+he !ain proble! faced by the internee during this
study was ti!e li!itation. &ue to shortage of ti!e on the part of the study and officials of the bank' very few !eetings and visits have been !anaged. S&')&'6 48 .3& D7.7 #nother !a/or proble! faced was the secrecy of data. "ecause of that' he I security breach and $I" I security policy. 4ence the availability of data is very !uch li!ited.
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CONCLUSIONS 3 SUSSESTIONS
C4+'5(-*4+Today !an"s ha$e to loo" much !eyond )ust pro$iding a multi,channel ser$ice platform for its customers# There are other pressing issues that !an"s need to address in order to chal",out a roadmap for the future# +ere are some of the concerns in the mind of e$ery !an"Es <=7# <ustomer retentionF <ustomer retention is one of the main priorities for !an"s today# @ith the entry of ne% players and multiple channels& customers ha$e !ecome more discerning and less EloyalE to !an"s# >i$en the $arious options& it is no% possi!le to open a ne% account %ithin minutes# 7r for that matter shift accounts %ithin a couple of hours# This ma"es it imperati$e that !an"s pro$ide !est le$els of ser$ice to ensure customer satisfaction# <ost pressuresF <ost pressures come into play %hen !an"s are not a!le to afford the cost of a certain ser$ice or initiati$e although they %ant to or need to ha$e it in place# This is primarily !ecause the cost structure at the !ac"end is not efficient enough to offer that "ind of ser$ice to the mar"etplace# The need for more in$estments in IT has increasingly forced some !an"s to sell, out of certain !an"ing operations# The cost of IT in$estment re*uired to remain competiti$e and the uncertainty future profits has forced %ithdra%al# 'ecurity of information systems %as found to !e $ery $ulnera!le in general# The amount of resources that is re*uired for security is lo%er than re*uired# The fact that G+ac"ers9 can still get into !an"ing IT systems easily %ithout inside help demonstrate the magnitude of the pro!lem#
IT Fraud is also a ma)or pro!lem of the !an"ing industry especially %here plastic cards are concerned# The increased IT "no%ledge of the general pu!lic and proliferation of cheap computer technology mean that %ea"nesses in card /3 Research Monograph Muhammad Faraz Ali Khan
payment systems are exploited fraudulently# Millions of Rupees is lost to plastic card fraud e$ery year# This is simply !ecause the cards are not secure enough# $ank I! and Security staff need to fully understand the organi%ation&s risks and vulnerabilities. 'nowing the drivers for change( both the e)ternal * internal influences. !hey must develop a corporate risk profile. Implement a strong +overnance and ,ontrols infrastructure. Monitor and maintain the security and risk profile to meet new challenges. -eputation risk associated with Denial of Service attacks can impact public opinion that results in a critical loss of funding or customers.
SUGGESTIONS
In recommendation the !an"ing industry need to !etter apply IT to impro$e its operations& customer ser$ices and products# (an"s should de$ote more resources to de$elopment of secure IT systems& ser$ices and products# Also& the future impact outsourcing IT re*uirements should !e thoroughly e$aluated& the long term effect may !e $ery expensi$e#
A. #doption of %ffective technology

It is suggested that responsible steps should be taken to insure I security frauds.
B. Eob raining 2rogra!s

$ib needs to provide its e!ployees with classroo! training. It needs to have its own training institution in 2akistan' as it is a leading bank. *uch institution can provide training opportunity to other local banks e!ployees too.
C. 2erquisites and #llowances
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he nu!ber of allowances and perquisites for the e!ployees should be increased to ensure that they put their body and soul in the /obs assigned to the!.
D. 2er!anent 4iring
he fresh hiring should be !ade per!anent so that they are secured of their future. ;urther the allowances and perquisites attached with the per!anent /obs will also increase the !otivation level of the e!ployees.
REFERENCES
1. 2. 3. 4. 5. 6. 7. 8. . 16#
///.H4/-.(88/4),-.'49 ///.-:<.4)1.<, ///.+*:<,.'49 NIB *+84)97.*4+ :44,5&.. 3!$!6$2!! S'3&2(5& 48 :7+, '37)1&- 7+2 -&);*'&-. ///.,-&.'49.<, NIB B7+,=- 7++(75 )&<4).. >2!!8? @(7).&)56 R&<4). 48 NIB B7+, > M7)'3 31A 2!! ? ///."*,*<&2*7.'49
Research /e'ho+s !n e+%ca'!on 4( ? <ohen& ? Manion& K Morrison H 2663

/5 Muhammad Faraz Ali Khan
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")*.*+1 7. U+*;&)-*.6B 7 1(*2& 84) -.(2&+.- 4( & Cre/e. MR Lea 6 277
Research Monograph
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An Internship Report on Banking Sector, Focus on NIB Bank Limited

o i!prove the writing and analytical skills a!ong the students.

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

1.1 INTRODUCTION TO BANKING

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

1.3 TYPES OF BANKS

1.4 COMMERCIAL BANKS

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

1.5 MERCHANT BANKS

1.6 SAVING BANKS

1.7 MORTGAGE BANKS

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

1.8 CONSUMER BANKS

1.1! DEVELOPMENT BANKS

1.11 COOPERATIVE BANKS

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

1.12 CENTRAL BANKS

1.13 ORIGIN OF BANKING SYSTEM IN PAKISTAN

An Internship Report on Banking Sector, Focus on NIB Bank Limited

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

INTRODUCTION OF NIB BANK LTD

2.1 HISTORY OF NIB BANK LIMITED

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

2.2 "HAT IS TEMASEK HOLDING

hrough its directly and indirectly owned subsidiaries

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

2.3 MISSION OF NIB BANK LIMITED

2.4 VISION OF NIB BANK LIMITED

2.5 CREDIT RATING

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

ORGANI#ATIONAL GOVERNANCE OF NIB BANK

An Internship Report on Banking Sector, Focus on NIB Bank Limited

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

2.8 ORGANIZATIONAL CHART

Muhammad Faraz Ali Khan

An Internship Report on Banking Sector, Focus on NIB Bank Limited

-ate <enter Incharge

:ersonal (an"ing <onsultant

<ounter 'er$ice 'uper$isor <ounter 'er$ice 7fficer (ranch 'er$ice 7fficer

rchitecture of "#B B", Secure Online Banking "et ork

").+1 7. U+;&)-.6B 7 1(*2& 84) -.(2&+.- 4( & Cre/e. MR Lea 6 277