PART 1 INTRODUCTION TO BANKING
It has been seen that the origin of banking was from the ancient time.Although at that time the banking activities were not in systematic way butbanking activities used to hold from that time. It has been said that the lendingand borrowing are as old as money itself. The word bank has been derived from the Italian word "banco". The wordbanco means bench. As the different monetary transaction used to be held bysitting-up in the bench, it has been named as banco. Macleod has defined theword banco as the accumulation of money or stock. Bank in an organized formwas first introduced in Italy in 1157 A.D. The Bank of Barcelona, Spain was thebank established in 1401 A.D. The first central bank was established in England,in 1844 A.D. But at present stage the bank has passed through different stage. Ithas been developing and modernizing its activities.Bank can be briefly defined as the financial intermediary between thedepositor and credit seeker. The transaction can happen between the bank anddepositor only when the depositors deposit certain amount in the bank and thebank has good relation with its customer. The Bank can make good relation withits customer only when it will be able to payback the amount deposited by thedepositor at time. The intermediation takes place when bank accept deposit fromgeneral public, corporate bodies and private organization and invest thosedeposit for profitable purpose in form of loan and advances. The bank hasstarted providing much more facility to its customer such as remittance of money, letter of credit, Bank guarantee, issue of money and many more.According to
Kinley
, "Bank is an establishment which makes to individualsuch advances of money or other means of payment as may be required &safety made and to which individual entrust money or means of payment whennot required by them for use."

According to Cambridge International Dictionary of English
"Anorganization where people and business can invest or borrower money changesit to foreign money etc. or a building where these services are offered." Thus, bank can be described as the custodian of savings of general peopleand established as well. It could have been quite impossible for theentrepreneurs to acquire the saving of general public for investment without theestablishment of the bank. So, bank can be best described as the financialinstitution that accept deposit and provide the certain rate of interest and loan itto the needy person, charging certain rate of interest and earn some profit in theprocess of intermediation.

1.2 ORIGIN AND GROWTH OF BANK IN NEPAL
 The lending or borrowing process of money used to be held even atancient time. The historical evidence shows the presence of some crude bankingpractice in the earlier period of time. But in case of Nepal it has a very shorthistory. The development of bank in Nepal can be divided into two parts:a)Traditional Bankingb)Modern Banking

a)Traditional Banking
 Traditional Banking is related with the process of taking money withprivate money lender and not with a registered institution. Previously the peopleused to take money from the private money lender. Generally, people used totake such loan for meeting daily expenses. The lender used to charge highinterest rate. In remote area till now there are different money lenders. There arethe sayings that in 780 B.S. King Guna kam Dev took loan from the money lenderand in B.S. 937 Shankadhar paid out the loan and started Nepal Sambat. In 14th century King Jaysthity Malla divided the people in 64 different casts. And Tankdhari was also one of them. The main occupation of such cast people was todeal with monetary transition. After this the Tejrath Adda was established ingovernment sector. They provide its services only to the civil servant to lowerrate of interest.Private money lender following certain malpractice used to chargeunreasonable rate of interest that caused inconvenience and difficulty to thepeople of country. The great need of a commercial bank was felt to eliminateprevailing hindrances caused by private money lender to the general public. As aresult, the "Tejarath Adda" was replaced by modern commercial bank.
b)Modern Banking
As the banking transaction started to be in broad condition there felt theneed of modern banking system. So in 30th
Kartik 1994 B.S the Nepal Bank Ltd.was established which was the first commercial bank in Nepal. Since then, thebanking operation began to foster. After the establishment of NBL Ltd., RastriyaBanijya Bank was established in 2013 B.S. Different joint venture banks alsostarted its operation in year 2041 B.S. Nepal Indosuez Bank Ltd. & NepalGrindlays Bank Ltd. was established in 2042 B.S. and 2043 B.S. respectively.Himalayan Bank Ltd. was established with the joint venture with Habib Bank of Pakistan. Nepal SBI bank followed Himalayan Bank in 2051 B.S. The three newbanks were opened in 2051 B.S., Nepal Bangladesh Bank Ltd., Everest Bank Ltd.,and Bank of Kathmandu Ltd. Meanwhile there are 16 commercial banks in Nepal.

1.3 MEANING OF NEPAL BANK LTD
Nepal Bank Ltd. was the first commercial bank. The banking history inNepal began from 30
th Kartik 1994 B.S. with the established of Nepal Bank Ltd.Under the privilege support from His Majesty King Tribhuvan. NBL commencedits operation of modern banking system by accepting and monitoring the savingof people and granting appropriate loan and monitoring the saving of people andgranting appropriate credit facilities to people, hence removing the hindrance inthe economic development of the people of the country. NBL was establishedwith the establishment with 51% of share of government of Nepal and 49% wasissued to general public. The authorized capital of this bank was 10 million. Thebank initially started its banking operation with paid up capital of Rs 842thousand of the issued price of Rs 2.5 million. NBL Ltd. has authorized capital of Rs. 1000 million, issued capital of 500 million and paid up capital of 38.04 crore. The present share percentage of Nepal Bank Ltd. is 40.49% of government and59.51% of the general public.

1.4 EXPANSION OF NBL
 As the main objective of commercial bank is to earn profit thus at thebeginning NBL was centralized in those areas where their business affairs tookplace. NBL has opened its main branch in Kathmandu.As different financial activities were held at this place, the first importancewas given to Kathmandu. NBL has its head office at New Road. Previously, as themain export & import activities used to be held from Birjung it was quiteimportant to open branch office at Birjung so the first branch office was openedthere at B.S. 1998. And as different business activities of eastern side was usedto be done from Nepalgunj the most priority was given to it and at same yearanother branch office of NBL was opened in Bhadrapur, Janakpur, Gaur andBiratnagar. From the date of establishment of NBL within 5 years, 8 branchoffices were opened and had started its services. In fiscal year 1999 to 2011 themore emphasis was given to the development of those banks. Till fiscal year2046 the bank has got 234 branches at 67 district and the number of bank staff reached to 8721. Later on a study report of CBPASS (Commercial Bank Problem Analysis and Strategy Study)
suggested that the non-performingbranches as well as excess staff should be removed. As a result NBL acceptedresignation of 800 staff and 15 branches were set collaborated. As a result NBLhas 212 branch office having 5500 staff employed. At present NBL has 7 branchoffices with fully computerized system and NBL is planning expand this number.NBL is further planning to expand its sector and its services in differentsectors.

As the main objective of commercial bank is to earn profit thus at thebeginning NBL was centralized in those areas where their business affairs tookplace. NBL has opened its main branch in Kathmandu.As different financial activities were held at this place, the first importancewas given to Kathmandu. NBL has its head office at New Road. Previously, as themain export & import activities used to be held from Birjung it was quiteimportant to open branch office at Birjung so the first branch office was openedthere at B.S. 1998. And as different business activities of eastern side was usedto be done from Nepalgunj the most priority was given to it and at same yearanother branch office of NBL was opened in Bhadrapur, Janakpur, Gaur andBiratnagar. From the date of establishment of NBL within 5 years, 8 branchoffices were opened and had started its services. In fiscal year 1999 to 2011 themore emphasis was given to the development of those banks. Till fiscal year2046 the bank has got 234 branches at 67 district and the number of bank staff reached to 8721. Later on a study report of
CBPASS (Commercial Bank Problem Analysis and Strategy Study)
suggested that the non-performingbranches as well as excess staff should be removed. As a result NBL acceptedresignation of 800 staff and 15 branches were set collaborated. As a result NBLhas 212 branch office having 5500 staff employed. At present NBL has 7 branchoffices with fully computerized system and NBL is planning expand this number.NBL is further planning to expand its sector and its services in differentsectors.
1.5 FUNCTIONS OF NBLNBL
is a commercial bank with an objective of earning maximum profit.But it has also given priority to the economic development of the country.
NBL
supply the financial need of the business by various means. Although the mainfunction of the bank is to earn maximum profit by providing different facilities toneedy people or organization to obtain the procedure benefit here are someother main functions of NBL:
a)To deposit money in saving, current and fixed deposit.
b)To provide loan with or without considering legal procedure.
c)To invest money in education, business, and agriculture sector forthe economic development of country as it has certain responsibilitytowards them.
d.)To invest in government bonds and securities.
e)To act as an agent.
f)To act as bank of government.
g)To provide safe custody of valuable goods.h)To issue letter of credit & credit instrument.i)To finance in foreign trade. j)To deal with foreign currency.k)To act as a referee and provide accurate information to the people.Apart from the banking function, the act empowers
NBL
to do insuranceand transport business. Further the main function of NBL that differ from othercommercial banks is that it is especially empowered by act to grant loan tocompanies undertaking profitable business associated with agriculture, mining,road, railways, ropeway and so on.

1.6OBJECTIVES OF STUDY 
 The main objective of the study is to get entire knowledge of fixed depositand its chief feature in regards of NBL. The objective can be specified as follow: -1.To analyze the share of fixed deposit out of total deposit of NBL.2.To analyze the trend of fixed deposit in NBL.3.To evaluate importance & utilization of fixed deposit account.4.To know opening & closing procedure of fixed deposit.5. To draw out different problems in fixed deposit management.

1.7 LIMITATIONS OF STUDY
 The study is made in certain limitation they are as follows: -
a)This study concern only period of 6 years.
b)There are number of factors that affect the banking policy of NBL.However only those factor, which are related with fixed deposit, isconsidered in study.
c) Main focus is give only in the trend of fixed deposit of NBL.

PART 2 MEANING OF FIXED DEPOSIT2.1MEANING
Fixed deposit constitutes a very important role for the bank. The amountdeposited for the fixed period of time is fixed deposit. It is generally opened bysuch person who doesn't need money frequently. And as the money is kept inbank for certain period of time it is also called time deposit. As the money iswithdrawn by the customers only after the maturity of date, pass book andcheque book are not given by the bank. Since bank can be certain about thewithdrawl period of deposit, the bank gets the opportunity to utilize that moneyin productive sector so his amount of interest is provided. In Nepal the fixeddeposit can be opened for 15 days, 1 month, 3 month, 6 months & 1 year andabove. The bank provides interest from 4.00% to 9.5%. After the maturity timethe customer can renew or withdraw the money. But before opening fixeddeposit it is necessary to have saving or current deposit.

2.2 PROCEDURE OF OPENING FIXED ACCOUNT
For opening fixed deposit account it is not necessary to have the identityof the person opening it. The person should only have to specify the amount tothe deposited. The maturity date and other important documents as enquired bythe bank must be provided. Here are some procedures of opening fixed depositthey are: -a) The applicant have to fill up the application form in which an applicantshould mention his name, address, the amount to be deposited and the time of maturity and the citizenship should be clearly mentioned.b) The applicant signature is very important for the bank. So, thesignature should also be done clearly.c) After filling up the form the depositor have to deposit the desiredmoney in the counter enough the voucher prepared by the bank’s employee forthe fixed deposit account.d) After completion of all the process, the fixed deposit section open fixeddeposit account in the name of applicant the bank provide receipt which is calledfixed deposit receipt. The fixed deposit receipt is not negotiable, so only theperson whose name is in receipt can take money after maturity.
e) To open the account in minor's name, the guardian name, cast andaccount number along with his/her own signature should be mentioned in theform.

2.3 PROCEDURE OF CLOSING FIXED DEPOSIT ACCOUNT
 The depositor may close the fixed deposit account after the maturity date.Because of different reasons the depositor may also close the account before itsexpiry date. So, for closing the fixed deposit earlier it is necessary for the bank togive pre-information. Thus the contract will be rescinded as well as the relationship betweenbank and customer will come to and with completion of due date. After thematurity date, the depositor may also renew his account if he doesn't want totake the money. For this he has to fill up the application form and submit to thebank.

2.4.CHARACTERISTICS OF FIXED DEPOSIT ACCOUNT
 The fixed deposit has its certain characteristics, which are mentioned asfollow:1. Fixed deposit account is opened for the fixed period of time. Theduration of the deposit period may be 7 days, 15 days, 1 month, 6months, 9 months, 1 to 5 years or above.2. Interest rate is provided according to the deposit period. Though thefixed deposit can be opened for more than 5 years, the maximuminterest rate remains the same as that of 1 year.3. The interest is awarded every 3 months.4. The Fixed Deposit Account holder could not withdraw his depositwithout completing the deposit period. However, the Fixed DepositReceipt can be pledged for loan from the bank.5. The Fixed Deposit Account can be renewed after expiry of the fixedtime.

PART 3 PRESENTATION AND ANALYSIS OF DATA
 The most valuable and crucial tool to evaluate the true and actual positionof any organization is its past data. The strength and weakness of theorganization can be appraised from the proper analysis of data. The part of the report focuses on presentation and analysis of data relatedto the current deposit of NBL to obtain the objective of study.
3.1TOTAL DEPOSIT
 The deposit are said to be "
life blood of the bank
". The first and utmostimportant thing to know is the total deposit trend in
NBL
. Total deposit refers tothe total deposit of the general public in various accounts during certain periodof time. The following table shows the status of deposit of NBL during the financialyear from 2055-056 to 2059-060.
From the above table we can say that the increasing trend of total depositof NBL has been fluctuating in every fiscal year. In the fiscal year 2056-057 thetrend of total deposits increased by Rs. 2486.1. Likewise in 2057-58 the changein total deposit is Rs. (50.2). Same as in 2058-059 the change in deposit is (1468.4). And in 2059-060 the change in deposit is increase as 677.3.Likewise in2060-061 changes in deposit increase by 1782.3, but in 2061-062 deposit isdecreased by 585.50. So the data above shows both the increasing as well asdecreasing rate. The variation in the total deposit may be because of theinflation caused by the increased of money supply in the country, which result inthe decrease in the value of the money.

The graphic presentation of total deport of NBL is shown in the figurebelow:

3.2 TREND OF FIXED DEPOSIT OF NBL:
Fixed deposit is the major source of working capital of any commercialbank. Thus NBL has been able to collect adequate fixed deposit by providingcompetitive rate of interest for investing alternatively in loans and advances andinvestment. The following table shows the trend of Fixed Deposit in NBL duringfiscal 2055-56 to 2059-60.

Source: NBL head officeFrom the above table it is apparent that the fixed deposit has beendecreasing continuously form 2055-056 to 2060-061. In fiscal year 2056-057 ithas decreased by 1878.9, in 2057-058 it again decreased by 2354.1, in 2058-059by 189.9, in 2059-060 it decreased by 1334.9 and in 2060-061 & 2061-062 it isdecreased by 916.0 and 264.0 respectively. The trend of six year is presented graphically if figure.

3.3FIXED DEPOSIT TO TOTAL DEPOSIT RATIO

This ratio measures the percentage of fixed deposit to total deposit ratio. This deposit is calculated by dividing fixed deposit with total deposit.

The Table No. 2 shows the high volume of Fixed Deposit in comparison toother deposit. The mean ratio of Fixed Deposit to Total Deposit is 28.54% for theprevious seven years during the fiscal year 2055-056 to 2061-062. The highestpercentage is 43.21% for the fiscal year 2055-056. The high volume of FixedDeposit shows the high liquidity of capital in NBL.

3.4 RATE OF INTEREST

Fixed deposit are considered to be the major source of capital and NBLhas been able to collect the fixed deposit by providing competitive rate of interest to the account holder in order to fulfill the demand of capital forinvesting alternatively in Loans and advances and Investment. The followingtable shows the before and current rate of interest on Fixed deposit:

3.5 COMPARISION OF INTEREST RATE OF FIXED DEPOSIT OF NBL WITHOTHER BANKS.

so for the above table we can say that the interest rate of NBL and otherbank are quite similar. The percentage of providing the interest rate has beenincreasing time to time. As the percentage of the deposit is also constantly  increasing it is quite important to make the changes in the percentage of providing the interest.

So from the above table it can be noticed that the fixed deposit trend of NBL is more than that of other banks. For example Himalayan Bank has got thefixed deposit of Rs. 2104.5 thousand in the fiscal year 1996-97 whereas NBL hasgot the deposit of Rs. 7001.0 thousand. In the same way from the above table itcan also be noticed that the amount of fixed deposit has been increasing inevery year, which is a quite good sign of the economic development of country.

3.7KARL PEARSON'S CORRELATION COEFFICIENT

Karl Pearson's method, popularly known as Pearsonian coefficient of correlation, is most widely used in practice to determine the relation betweentwo variables. It is denoted by "r" and defined by:

Since Karl Pearson's correlation coefficient (r)=-0.55

the two variables fixed deposit and total deposit has high degree of negativecorrelation. That means the increament/decreament in total deposit willnot cause change in fixed deposit.

Estimation of Fixed Deposit of NBL For the year

2062 By least square methodTime Series

Table 8: Trend line of fixed deposit

PART 4  SUMMARY AND CONCLUSION

4.1 SUMMARY

Bank is the most important institution for accelerating economic growth inthe country. It is quite true that a strong financial institution is of a great need inthe development of the developing country like Nepal. The Nepal Bank Limited isone of the oldest banks of the country which has got the history of 66 years. Thisbank is now in its advance stage. As being the first commercial Bank it has topass through the different ups and down. NBL has been providing differentservices to its customers. NBL played a vital role in the over all development of the country. The bank only had authorized capital of Rs 842 thousand at itsstarting stage, which has now increased to 1000 million. NBL previously wasstarted with the 51% of the government and 49% of the public but at presenttime the bank has got the 40.49% share of the government and 59.51% of thegeneral public. So looking at this factor, NBL has developed a lot in this time. TheBank has high contribution in fulfilling the economic improvement by collectingthe scattered resources through the network of 127 branches through out thecountry. The bank has the thought of computerizing the very branch. NBL atpresent has 7 branch offices which are fully computerized. Though commercial banks are profit oriented and invest these resourcesin those sectors from where they could gain maximum profit, NBL is initiated notonly with profit oriented motive. It has always given preference to the economicand the financial development of the country. It provides credit facilities to thetrader, agriculturist, industrialist, businessman etc. It can also be said that NBLacts as the pillar of the economic development. NBL facilitates internationalbanking by being directly connected with major international banks.NBL has different functions but the main function is to provide the securityto the wealth of the customers. NBL generally provide three different types of accounts i.e. saving, current and fixed deposit account. Although the interest isnot provided in current account, people deposit in this account for its safety.Fixed deposit account is most common among the people because it has higherinterest rate, can be pledged as collateral for loan and easier to open. The study provides the entire knowledge of getting Fixed Deposit Accountopened, operated and closed. Fixed Deposit Account is opened for the fixedperiod of time but the account holder cannot operate it during its time period. The rate of interest on Fixed Deposit Account is provided according to the

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duration of deposit period. The fixed Deposit Receipt is provided to the depositor,in lieu of passbook or cheque book. Once the deposit period mature, the interestand principal of the Account is credited to the depositor saving or currentAccount and thereafter, Fixed Deposit Account is automatically closed.

4.2.CONCLUSION

So from the study and analysis of the data of the fixed deposit of NBL itcan be said that the percentage of depositing money in the fixed deposit hasbeen decreasing day by day. It can be said that the bank has not been able toutilize the collected saving according to the borrower and nation requirement.Since in these few years economy is going through recession it has resulted inthe drastic decrease in the interest rate provided by commercial banks includingNBL. It will be profitable for NBL if it provides more amount of long term andmedium term loan. Though full effort is given to make this study meaningful andweighty, some mistakes might have occurred due to time shortage.

4.3RECOMMENDATION

After the study of the different data provided by NBL and the datacollected from different sources about NBL there are some recommendationreferred to NBL which may help it in further development:a) As this is the modern competitive, customers want more improvedservices so bank should attract more depositors by providingimproved and new services and facilities.b) The banks should use modern instrument to perform the bankingactivities.c) The bank must employ only required number of employeesotherwise it may create a big problem in bank.d) The Bank should also provide more attention towards the prioritysectors and also provide the industrial scheme for the developmentof the economic condition of the country.e) The bank must not invest only in one sector; different sector shouldbe selected of the investment.g) Since it has certain responsibility towards the country, it must workfor the economic development of the country.

BIBLIOGRAPHY 

1. Vaidya Shakespeare: - Money & Banking (Published by Pratibha JoshiDecember 1997)2. Nepal Rastra Bank: - Banking and Financial Statistic (Published UnderBanking Operation Department)3. Dr. Joshi Shyam Dr. Hari Prasad Shrestha: - Principle of Banking andInsurance (Published by Teleju Prakshan 2058)4. Nepal Bank Limited: - Bank Patrika and Annual Report (Published by NepalBank Limited)5.Pant R. Prem: - Field Work Assignment and Writing (Published by VeenaAcademic Enterprise Pvt. Ltd. Kathmandu)