Marketing Management:

A Case Study of

National Bank of Pakistan (NBP)

19 Feb, 2011

Prepared By

Rafique Nancy 5152,

Salman Ahmed 5182

Komal Benjamin 5276,

Khurram Baber 5141

ACKNOWLEDGEMENTFirst and foremost let us sincerely thank ALMIGHTY for the great opportunity and

blessing that he has showered up on us for the successful and timely completion of

our project work.

We very great fully wish to forward due respect and thanks to our MMR teacher Sir

Santosh Kumar for his teaching and continues, creative, valuable, and informative

support, with out which the project would not have been efficiently completed.

We are extremely indebted to the management of National bank of Pakistan head

office Karachi, A.D Tahir Chief Operation’s manager NBP main branch Karachi

who gave us the privilege to carry out our project in their distinguished organization.

Let us take this opportunity to thank all the National Bank’s staff for their help and

co-operation.

Once again we take this opportunity to convey our sincere thanks to each and every

person who helped us directly and indirectly in the successful completion of this

project.

All Team Members.

TABLE OF CONTENT

i. History & Introduction of NBP

ii. NBP Positioning

iii. Objective of NBP

iv. Function of NBP

v. Unmatched Banking Services of NBP

vi. Target Market

vii. Marketing Mix

viii. SWOT Analysis

ix. Conclusion & Remarks

HISTORY OF NBP

The NBP was established vide NBP Ordinance No. XIX of November 9. 1949.

British Govt. devalued its currency in September 1949, India devalued its rupees

but Pakistan did not. It led to a crisis in trading between the two countries and

India refused to lift the Pakistan Jute. To solve this problem i.e. to export jute

NBP was established through an Ordinance of GOP. National Bank of Pakistan

maintains its position as Pakistan's premier bank determined to set higher

standards of achievements. It is the major business partner for the Government

of Pakistan with special emphasis on fostering Pakistan's economic growth

through aggressive and balanced lending policies, technologically oriented

products and services offered through its large network of branches locally,

internationally and representative offices.

The Bank in 1950 had one subsidiary ‘The Bank of Bahawalpur’ on December4,

1947 by the former Bahawalpur State.

NBP was undertaking Treasury Operations and Managing Currency Chests or

Sub Chests at 57 of its offices where the turnover of the business under the head

amounted to Rs.2460 million.

i) Deposits held by NBP constituted about 3.1% of total deposits of all

Pakistani Banks in 1949, which rose to 38% in 1952.

ii) Growth in Deposits was accompanied by increase in Bank portfolio in

advances. NBP lent out to Textile, Yarn, Iron and Steel and played a pioneer role

in support of agriculture and commerce.

iii) NBP advances reached Rs.554.4 million by December 1959, which was

one third of the total schedule bank credit.

National Bank of Pakistan is the largest commercial bank operating in

Pakistan. It has redefined its role and has moved from a public sector

organisation into a modern commercial bank. 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, NBP headquarters in Karachi, Pakistan with

over 1,200 branches country wide. The bank provides both commercial and

public sector banking services. It has assets worth USD 12.293 billion in

2007. Its subsidiaries include NBP Capital, NBP Modaraba Management

Company, NBP Exchange Company, Taurus Securities, NBP Almaty and

others.

MISSION STATEMEN

“To make the Bank complete and competitive with all international Standard in

performing, quality of, operations, staff, financial strength. And products and

services to develop a culture of excellence in every spare of activity of the

bank”.

GOALS AND OBJICTIVES OF NBP

“To be the pre-eminent financial institution in Pakistan and achieve market

recognition both in the quality and delivery of service as well as the range of

product offerings.”

POSITIONING

To be recognized as a leader and a brand synonymous with trust, highest

standards of service quality, international best practices and social responsibility.

NBP truly the Nation’s Bank, because of

• 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.

CORE VALUE

Highest standards of Integrity

• Institutionalizing team work and performance culture

• Excellence in service

• Advancement of skills for tomorrow’s challenges

• Awareness of social and community responsibility

• Value creation for all stakeholders

NBP further consolidated its position as one of the top players in corporate and

investment banking of the country and has built a strong customer relationship

with the premier corporate clients.

Objectives of NBP

National bank of Pakistan is also a commercial organization and its main

objective is profit maximization. This is achieved in two ways:

1. By increasing deposits.

2. By charging interest on loans provided to the private sector and business

community.

These are explained as:

Increase in deposits:

Competition in banking is intense and every bank whether it is Pakistani, foreign,

private or nationalized tries to increase its deposits by providing better facilities to

its customers. By increasing its deposits a bank can extend greater amount of

loan and hence achieves higher profit. NBP is also improving its facilities and

services to attract customers with higher volume of deposits. There are two main

factors involved in increasing the deposits. These factors are improving the

services and courtesy. NBP is continuously working on these two factors to

increase its deposits.

Extension of loans:

The profitability of a bank largely depends on the amount given to people as loan

and the type of people to whom credit is given i.e. the credit worthiness of the

borrowers. This strategy has worked quite well for NBP. Deposits are collected

from the people and invested in different projects. NBP prefers to give loans to

financially sound and reliable parties, after securing the collators. NBP has an

extremely well organized section. The staff is adequately trained, and educated

and competent. They carry out extensive financial analysis before deciding on

the loan. Interest charged on the loans potentially contributes to higher profits.

Some of the other objectives of NBP are:

i. Improve customer services.

ii. Quick disposal of credit cases.

iii. Efficient operation of the branches.

iv. Better Public Relations.

v. Operational and advisory services for foreign exchange accounts activities

FUNCTION 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:

Accepting Deposits

This function is important because banks largely depend on the funds deposited

with them by its customers. Deposits are of many types:

i. 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/-.

ii. 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/-

iii. 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.

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 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.

Agency service

NBP also provides best and unique service to its valued customers. NBP provide

the following agency services to the customers:

i. 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.

ii. 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.

iii. Acting as an agent

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

home or abroad.

iv. 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.

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.

Unmatched Banking Facilities

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.

Hajj arrangements.

Sale and encashment of Defense Savings and Special Savings

Certificates.

Safe Deposit Lockers for customers.

Rational Human Resource Management.

The prestigious periodical “The Banker” UK recognized NBP as the best bank for

2001-2002 and NBP is the bank of the year for 2004-2004 of Pakistan.

i. AAA rating awarded JCR-VIS Credit co. Ltd and affiliated of Japan Credit

Rating Agency for 2001.

ii. AAA+1 rating awarded JCR-VIS Credit Co.Ltd and affiliated of Japan

Credit Rating Agency for 2002

NBP at the forefront of Pak-Afghan trade

i. Booth at dry port Peshawar

ii. Booth at Pak Afghan border (Torkham) NWFP

iii. Booth at Pak Afghan border (Chamman). Baluchistan.

iv. Establishing branch at Kabul.

TARGET MARKET

PUBLIC SECTOR (GOVERNMENT OF PAKISTAN)

CORPORATE SECTOR

AGIRCULTURE SECTOR

MICRO FINANCE

SAVING

INSURANCE

MARKETING MIX

PLACE

1255 BRANCHES IN PAKISTAN

26 OVERSEAS BRANCHES

NBP IS EVERY WHERE

PRICE STRATEGY

Deposit security, Guaranteed by Government of Pakistan.

Highest rates of return to attract the savings.

Lowest rates on exports and other borrowings.

PROMOTION STRATEGY

HOLDING BOARDS OF SAME TYPE ACROSS PAKISTAN

SPONSARING & PARTICIPATION IN DOMESTIC SPORTS EVENTS

GIVING JOBS TO SPORTS HEROES

TRAINED FIELD & ON DESK STAFF

ACTIVELY PERFORMING SOCIAL RESPONSIBILITY

INFORMATIVE WEB LINK

PRODUCTS & SERVICES

Services are outputs of the firm, which are in intangible form. Which are the

backbones of any organization to earn profit. NBP offers the following services to

the people.

DEMAND DRAFTS

If you are looking for a safe, speedy and reliable way to transfer money, you can

now purchase NBP’s Demand Drafts at very reasonable rates. Any person

whether an account holder of the bank or not, can purchase a Demand Draft

from a bank branch.

SWIFT SYSTEM

The SWIFT system (Society for Worldwide Inter bank 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 in the

payment of home remittances.  The SWIFT Center is operational at National

Bank of Pakistan with a universal access number NBP-APKKA.  All NBP

overseas branches and overseas correspondents (over 450) are drawing

remittances through SWIFT.

Using the NBP network of branches, you can safely and speedily transfer money

for our business and personal needs.

LETTERS OF CREDIT

NBP is committed to offering its business customers the widest range of options

in the area of money transfer.  If you are a commercial enterprise then our Letter

of Credit service is just what

you are looking for. With competitive rates, security, and ease of transaction,

NBP Letters of Credit are the best way to do your business transactions.

TRAVELER'S CHEQUES

Traveler’s cheques are negotiable instruments, and there is no restriction on the

period of validity of the cheques. Rupee traveler’s cheque is available at all 700

branches of NBP. This can be encashed in all 400 branches of NBP. There is no

limit on purchase of this cheque. It is one of the safest ways for carrying money.

PAY ORDER

NBP provides another reason to transfer your money using our facilities.  NBP

pay orders are a secure and easy way to move your money from one place to

another.  And, as usual, NBP charges for this service are extremely competitive.

The charges of NBP are very low all over the Pakistan. It charges Rs 50/- for

NBP account holders on issuing one payment order. And charges Rs 100/- for

NBP non-account holders on issuing one payment order. It charges Rs 25/- for

students on payment of fees of educational institutions. If some one want a

duplicate of payment order they charges Rs 100/- for NBP account holders and

Rs 150/- for non account holders.

AIL TRANSFERS

Move your money safely and quickly using NBP Mail Transfer service.  And NBP

also offers the most competitive rates in the market. They charges Rs 50/-

exchange rate and RS 75/- postage charges on issuing mail transfer.

FOREIGN REMITTANCES:

To facilitate its customers in the area of Home Remittances, National Bank of

Pakistan has taken a number of measures to:

Increase home remittances through the banking system

Meet the SBP directives/instructions for timely and prompt delivery of

remittances to the beneficiaries

New Features:

The existing system of home remittances has been revised/significantly improved

and well-trained field functionaries are posted to provide efficient and reliable

home remittance services to nonresident Pakistanis at 15 overseas branches of

the Bank besides Pakistan International Bank (UK) Ltd., and Bank Al-Jazira,

Saudi Arabia. 

Zero Tariffs: NBP is providing home remittance services without any

charges.

Strict monitoring of the system is done to ensure the highest possible

security.

Special courier services are hired for expeditious delivery of home

remittances to the beneficiaries.

SHORT TERM INVESTMENTS

NBP now offers excellent rates of profit on all its short-term investment

accounts.  Whether you are looking to invest for 3 months or 1 year, NBP’s rates

of profit are extremely attractive, along with the security and service only NBP

can provide.

National Income Daily Account (NIDA)

The scheme was launched in December 1995 to attract corporate customers.  It

is a current account scheme and is part of the profit and loss system of accounts

in operation throughout the country.  

Salient Features:

Rs 2-million are required to open an account and there is no maximum

limit.

Profit is paid on half yearly basis on monthly balances.

The rates of profit vary according to the slabs of deposit. On Deposits of

Rs.2 million to 2,000 million, the rate fluctuates from 1.4 to 1.75

It is a checking account and there is no limit of withdrawals.

Rates on NIDA

From Rs 2/- million to Rs 50/- the rate is 1.4%.

From Rs50/- million but less than Rs 500/-million, the rate is 1.5%.

From Rs 500/- million but below Rs 1000/- the rate is 1.6%.

From Rs 1000/- and above the rate is 1.75%.

TRADE FINANCE OTHER BUSINESS LOANS

AGRICULTURAL FINANCE

NBP provides Agricultural Finance to solidify faith, commitment and pride of

farmers who produce some of the best agricultural products in the World.

Agricultural Finance Services:

“I Feed the World” program, a new product, is introduced by NBP with the aim

to help farmers maximize the per acre production with minimum of required

input.  Select farms will be made role models for other farms and farmers to

follow, thus helping farmers across Pakistan to increase production.

Agricultural Credit:

The agricultural financing strategy of NBP is aimed at three main objectives:-

Providing reliable infrastructure for agricultural customers

Help farmers utilize funds efficiently to further develop and achieve better production

Provide farmers an integrated package of credit with supplies of essential inputs, technical knowledge, and supervision of farming.

 Agricultural Credit (Medium Term): 

Production and development

Watercourse improvement Wells Farm power Development loans for tea plantation Fencing Solar energy

Farm Credit:

NBP also provides the following subsidized with ranges of 3 months to 1 year on

a renewal basis. 

Operating loans

Land improvement loans

Equipment loans for purchase of tractors, farm implements or any other

equipment

Livestock loans for the purchase, care, and feeding of livestock.

Production Loans:

Production loans are meant for basic inputs of the farm and are short term in

nature.  Seeds, fertilizers, sprayers, etc are all covered under this scheme.

 

CORPORATE FINANCE

Working Capital and Short Term Loans:

NBP specializes in providing Project Finance – Export Refinance to exporters –

Pre-shipment and Post-shipment financing to exporters – Running finance –

Cash Finance – Small Finance – Discounting & Bills Purchased – Export Bills

Purchased / Pre-shipment / Post Shipment Agricultural Production Loans

Medium term loans and Capital Expenditure Financing:

NBP provides financing for its clients’ capital expenditure and other long-term

investment needs.  By sharing the risk associated with such long-term

investments, NBP expedites clients’ attempt to upgrade and expand their

operation thereby making possible the fulfillment of our clients’ vision.  This type

of long term financing proves the bank’s belief in its client's capabilities, and its

commitment to the country.

Loan Structuring and Syndication:

National Bank’s leadership in loan syndicating stems from ability to forge strong

relationships not only with borrowers but also with bank investors.  Because we

understand our syndicate partners’ asset criteria, we help borrowers meet

substantial financing needs by enabling them to reach the banks most interested

in lending to their particular industry, geographic location and structure through

syndicated debt offerings.  Our syndication capabilities are complemented by our

own capital strength and by industry teams, who bring specialized knowledge to

the structure of a transaction.

FOLLOWING ARE THE REQUIREMENTS

LIMIT Rs.50,000/ - To Rs.10,000,000/-

customer's equity @ 30% Comfortable and secure environment for trading NBP financing at very easy terms requiring minimum documentation No security requirement from the customer except for the customer's

equity Customer's equity freely available for investment.

Equity acceptable in cash or approved share.

Cash Management Services:

With National Bank’s Cash Management Services the customer’s sales collection

will be channeled through vast network of NBP branched spread across the

country.  This will enable the customer to manage their company’s total financial

position right from your desktop computer.  They will also be able to take

advantage of our outstanding range of payment, ejection, liquidity and investment

services.  In fact, with NBP, you’ll be provided everything, which takes to manage

your cash flow more accurately. EOBI and Pakistan railway is currently availing

NBP cash management services.

INTERNATIONAL BANKING

National Bank of Pakistan is at the forefront of international banking in Pakistan,

which is proven by the fact that NBP has its branches in all of the major financial

capitals of the world.  Additionally, NBP have recently set up the Financial

Institution Wing, which is placed under the Risk Management Group.  The role of

the Financial Institution Wing is:

To effectively manage NBP’s exposure to foreign and domestic

correspondence

Manage the monetary aspect of NBP’s relationship with the

correspondents to support trade, treasury and other key business areas,

thereby contributing to the bank’s profitability

Generation of incremental trade-finance business and revenues

NBP offers:

The lowest rates on exports and other international banking products

Access to different local commercial banks in international banking

MICRO FINANCE:

NBP offer following services for low level financing.

Cash and Gold Finance.

Cash and Gold finance means that loan is given against the gold. The gold is

mortgaged with the bank and loan is taken. It is the area of consumer finance.

And borrower can take loan for common use.

acility of Rs. 20, 000/-against each 10 gms of net weight of Gold

Ornaments

No maximum limit of cash

Repayment after one year

Roll over facility

No penalty for each repayment

Advance salary loan:

This loan is given to those people who are govt servants. They can get a loan up

to:.

20 ADVANCE SALARIES AT ONCE

Easy installments of 1 to 60 months at your choice

Quick processing and fastest disbursement

The product is for permanent employees of Government, Semi

Government and Autonomous bodies receiving salaries through NBP

accounts

Mera Apna Karobar

Minimum down payment, 10% of asset price (5% for PCO & Telecaster)

Tenure 1 to 5 years (for PCO 2 years)

Grace period 3 months

Maximum loan amount Rs. 200,000/-

Age 18-45 years

The customer will pay markup @ 6% p.a., rest will be borne by GOP

Life & disability insurance paid by Government of Pakistan.

MEANS OF UTILIZATION

NBP Karobar Utility Store

NBP Karobar Mobile Utility Store

NBP Karobar Mobile General Store

NBP Karobar Transport

NBP Karobar PCO

NBP Karobar Tele-Centre

PROTECTION SHIELD Personal Accident Insurance

No documentation

No medical required

Coverage includes death due to:

Natural Calamities e.g. Earthquake, Flood, Cyclone etc.

Accident

Riots

Civil Commotion

Strikes

Acts of Terrorism

SWOT ANALYSIS

SWOT analysis is an acronym that stands for strengths, weakness, opportunities,

and threats SWOT analysis is careful evaluation of an organization’s internal

strengths and weakness as well as its environment opportunities and threats.

“SWOT analysis is a situational which includes strengths, weaknesses,

opportunities and threats that affect organizational performance.”

“The overall evaluation of a company strengths, weaknesses, opportunities and

threats is called SWOT analysis.”

In SWOT analysis the best strategies accomplish an organization’s mission by:

1. Exploiting an organizations opportunities and strength.

2. Neutralizing it threats.

3. Avoiding or correcting its weakness.

SWOT analysis is one of the most important steps in formulating strategy using

the organization mission as a context; managers assess internal strengths

distinctive competencies and weakness and external opportunities and threats.

The goal is to then develop good strategies and exploit opportunities and

strengths neutralize threats and avoid weaknesses.

STRENGTH

OLDEST INSTITUTION:

NBP is one of the oldest bank of Pakistan and first nationalized bank Hence its

customer base is strength from this plus point as customers have more

confidence in the bank. The additional value services as the privilege for the

bank.

ALTERNATE DUTIES IN SBP ABSENCE

The NBP performs additional services for its customers as well as the other bank

customer in the absence of SBP.

MORE DEPOSITS THAN OTHER BANKS

NBP has the relative competence in having more deposits than the other bank.

This is because of the confidence the customer have in the bank. The bank being

the privileged and oldest bank in banking sector of Pakistan enjoys this edge

over all others, lacking it.

EMPLOYEE BENEFITS

The employers at NBP are offered reasonable monetary benefit. Normally two

bonuses are given Eid-Ul-Fitar & Eid-Ul-Azha. This serves as an additional

benefit and competency for the bank and a source of motivation for the

employees.

BROAD NETWORK

The bank has another competency i.e. it has broad-basses network of branches

throughout the country also more than one branch in high productive cities. The

customers are provided services at their nearest possible place to confirm

customer satisfied.

STRICTLY FOLLOWED RULES & REGULATION:

The employees at NBP are strict followers of rule & regulation imposed by bank.

The disciplined environment at NBP bolsters its image and also enhances the

over all out put of the organization.

PROFESSIONAL COMPETENCE

The employees at NBP here have a good hold on their descriptions, as they are

highly skilled Professionals with background in business administration, banking,

economics etc. These professional competencies enable the employees to

understand and perform the function and operation in better way.

HEALTHY ENVIROMNMENT

The working condition in the NBP branch here is very conductive and favorable

for better output. The informal environment affects the performance of the

employees in a positive way.

RELATION BETWEEN STAFF AND OTHER EMPLOYESS

The bank enjoys a good plus point when it comes to the employee manager

relationship the hearing as removing of discrepancies if any, between the

employees, and between the manager and employees.

WEAKNESSES

LACK OF MARKETING EFFORT:

The bank does not promote its corporate image, services, etc on a competitive

way. Hence lacks far behind in marketing effort .A need for aggressive marketing

in there in the era marketing in now becoming a part of every organization.

NBP UNDER POLITICAL PRESSURE

The strong political hold of some parties and government and their dominance is

affecting the bank in a negative way. They sometime have to provide loan under

the pressure, which leads to uneven and adjusted feeling in the bank

employees.4.3.3

FAVORITISM AND NEPOTIS

The promotions and bonuses etc in the bank are often powered by senior’s

favoritism or dependupon their wills and decision. This adds to the negative

factors, which denominate the employees thus resulting in affecting their

performance negatively.

LACK OF FINACIAL PRODUCT

The bank falls far behind when the innovative and new schemes are considered.

It has not been involved in the tug of war between the competitors to the

accounts and strengthens the existing customer base. This stands out to be the

major incompetence and weakness of the banks.

INEFFICIENT COUNTER SERVICES IN THE RUSH HOURS

During the rush hours, the bank is founded out to be a total flop to handle the

mob of people peaking from windows and doors. The bank has deficiency to

operate in the stages of rush hours where the people find them services

entangled in a situation of nowhere because they are not well served.

OPPORTUNITIES

ELECTRONIC BANKING

The world today has become a global village because of advancement in the

technologies, especially in communication sector. More emphasis is now given to

avail the modern technologies to better the performances. NBP can utilize the

electronic banking opportunity to ensure on line banking 24 hours a day. This

would give a competitive edge over others.

MICRO FINANCING

Because of the need for micro financing in the market, there are lot of

opportunities in this regard. Other banks have already initiated, now the time has

arrived when the NBP must realize it and take on step to cater an ongoing

demand and introduce products like auto finance etc.

THREATS

EMERGENCE OF NEW COMPETITORS

The bank is facing threats with the emergence of new competitors especially in

terms of foreign banks. These foreign banks are equipped with heavy financial

power with excellent and innovative ways of promoting and performing their

services. The bank has to take initiative in this regard or will find itself far back in

competition.

POLITICAL PRESSURE BY ELECTED GOVERNMENT

The ongoing shift in power in political arena in the country effects the

performance of the bank has to forward loans to politically powerful persons

which create a sense of insecurity and demoralization in the customer as well as

employees.

DOWNSIZING

The bank is currently acting upon the policy of downsizing which threaten the

environment of the bank Employees feel insecurity in doing their jobs and work,

hence affecting the over all performance of employees negatively.

CUSTOMERS COMPLAINTS

There exists no regular and specific system of the removal of customer

complaints. Now a day a need for total customer satisfaction is emerging and in

their demanding consequences customer's complaints are ignored.

COMPETITIVE ANALYSIS Porter’s five forces model:

This approach is widely used for competitive analysis. It is because of the high

intensity of competition among companies there five main competitive forces.

Rivalry among competitive firms:

It is a very powerful force among the competitive forces the strategies pursued by

one firm can be successful only to extent that they provide competitive

advantages over the competitor. These competitive strategies may be lowering

prices, best quality series. The NBP offering very low charges an demand draft,

telegraphy transfer, mail transfer and give other additional services to the

customers and to the Nation. Because NBP is a “Nation’s Bank”.

Potential entry of new competitors:

Whenever new firms ca easily enters a particular industry, the competition

increases. The gout restriction, tariffs, patents etc can stop new firm to enter into

the business as per Banking industry is concerned this market is already very

situated in Pakistan and there are banks with quality services and low charges.

So there is no threat to NBP from potential entry and NBP is also a public sector

bank because of that no other new bank not takes over it.

Potential Development of substitute products:

This is the third factor affecting the competitions. There may be some other

product can be substitute the product of that industry. For example banks offering

sawing schemes in Pakistan and these schemes are also offered by GPOs in

Pakistan so they must compete them in this field. If they offer low rates than

GPOs so people will go to deposit in GPOs. People concentration high rates so

that’s why sawing PLS accounts are more then current accounts. The next

examples will ATM which substitute presenting cheques at counter and encash it.

The NBP is lacking in this field. It must improve in this field to compete the

competitors.

Bargaining Power of Suppliers:

The bargaining power of supplier affects the intensity of competition, especially

when there are a large number of suppliers. In case of banks the suppliers are

customers they supply the money to banks. Now they must offer good services,

quality, and safety. Low charges etc to customers. In this field NBP is very good.

B/C at offers good quality services to customers. They charge low charges on

remittances. So that’s it is a competition to other banks.

Bargaining Power of Consumers:

When customers are concentrated or large, or buy in volume, their bargaining

power represents a major force affecting intensity of competition. Now the

number customers in Pakistan for banks are very high. Banks offering variety of

products and services to their customers. NBP have a large number of customs.

Now it must offer good services and products to their customers to attract them

to come to NBP.

CONCLUSION:

A simple questioner was design to evaluate the perceived value of NBP & to

have customer feedback on the services provided by NBP from a sample of 50

customers. The results are highlighted in form of charts.

Do you think that NBP caters all your banking needs? (1) Yes (2) No

1

2

What do you think about quality of services provided by NBP (1) Good (2)

Bad

1

2

Are you aware of core banking facility for the customers provided by NBP

(1) Yes (2) No

1

2

Does NBP charge unnecessarily for not maintain minimum balance in

your account (1) Yes (2) No

1

2

Does NBP charge less then other banks

(1) Yes (2) No

1

2

Do you use other banks services as well

(1) Yes (2) No

1

2

Reason for using other Bank's service is

(1) Bad Counter Service of NBP (2) High Interest rate

1

2

What do you feel about overall service quality of NBP

(1) Satisfied (2) Disdatisfied

1

2

REMARKS:

Customer solutions provided by NBP are superior then other banks but the counter

services are usually a concern for the customer because of which they are using services

of other banks as well.

The customer base of NBP is Un-harvested and NBP has the potential to capture the

entire market by improving the internal atmosphere of the organization and training its

employee for proper counter service

Similarly NBP can offer new variety of products for individual customer who will help

NBP to reposition it self as a true commercial bank rather then a government bank.

There is a requirement of Marketing Research Department in NBP which will help it to

analyze market and help to mold it self according to Marketing concept rather then

Product concept.