Sweta NP

A Project Proposal
On
Capital Structure of Nabil Bank
Presented by:
SWETA RAJBANSHI
T. U. Registration No: 7-2-151-83-2019
A Project work report
Submitted to:
Research Management committee
PUSHPALAL MEMORIAL COLLAGE
TRIBHUVAN UNIVERSITY
In partial fulfillment of the requirements for the degree of
Bachelor of Business Studies (BBS)
CHABAHIL, KATHMANDU
APRIL, 2024
Table of content:
1. Background of the study……………………………………………………………………………. 1

2. Objectives of bank…………………………………………………………………………………….. 4
3. Rationale of the study……………………………………………………………………………….. 4
4. Limitation of study…………………………………………………………………………………….. 5
5. Literature review……………………………………………………………………………………….. 5
6. Research Methodology……………………………………………………………………………….. 5
6.1 Research Design……………………………………………………………………………………. 5
6.2 Population and sample………………………………………………………………………….. 5
6.3 Source of data………………………………………………………………………………………… 6
6.4 Data collection and processing procedure……………………………………………… 6
6.5 Data analysis tools and technique……………………………………………………………. 6
1.1 BACKGROUND OF THE STUDY
Banks are among the most important financial institutions. We define bank as an
institution which deals with money and credit. A bank is an institution which accepts
deposits from the public and in turn advances loans by crediting credit. Generally bank
accepts deposit from business institutions and individuals, which will be mobilized to
productive sectors mainly for business investment and consumer lending. In the present
context, most banks are engaged in different types of functions such as remittance,
exchange currency, joint venture, underwriting, bank guarantee, discounting bill etc. In
other words, the banks refer to an institution having the following features. It deals with
money; it accepts deposits and advances loans. It also deals with credit; it has the ability to
create credit by expanding its liability. It is commercial institution; it aims at earning profit.
1.2 DEFINITION OF BANK
According of Kent, A bank is an organization where principal operations are concerned with
the accumulation of temporarily idle money of the general public for the purpose of
advancing to other for expenditure.
According to US law any institution offering deposits subject to withdrawal on demand and
making loans of a commercial or business nature is a bank.
A bank is a financial institution licensed to receive deposits and make loans. Banks may also
provide financial services, such as wealth management, currency exchange, and safe
deposit boxes. There are two types of banks; commercial/ retail banks and investment
banks. In most countries, banks are regulated by the national government or central bank.
Thus in conclusion we can say that bank is an organization which deals with the monetary
transactions for the mobilization of idle money or deposits in productive sector, is
essentially essential for the development of the whole nation.
1.3 Statement of the problem:
The banking acts lays down the detail of statistical information that the bank must provide
about their business. Balance sheet and profit and loss account have to be provided in a
prescribed form for the publication. It is the instrument, which helps to evaluate banks by
various parties. Share holders judge it whether to keep the share of the bank with it or sell,
depositor analyzed it to deposit their money in the bank or not, investors access to invest it
or not. Thus, analysis of component of balance sheet has a paramount importance.
Capital structure reflects the financial risk or leverage, shareholder and depositors evaluate
bank riskiness in terms of risk adjusted assets and capital sufficiency to meet expected risk.
Therefore this study aims to seek the answer of the following questions:
 What is the trend of net worth of the Nabil Bank?
 What is the trend of total liabilities including deposit of the company?
 What is the trend of earning per share of the company?
1.4 OBJECTIVE OF THE STUDY:
The main objectives of the study are to analyze the capital structure of the Nabil Bank. To
achieve the main objectives, following sub objectives has been set out.
 To evaluate the composition of capital structure of Nepal Bank Limited.
 To evaluate the borrowing Trend of Nabil Bank.
1.5 RATIONAL OF THE STUDY:

The field work report “ A case study on the capital structure of Nabil bank” is partial
fulfillment of BBS degree related to the finance specialization. The following are the
significance of the study:
 It will be a literature to the other researchers, who want to further study in the
field.
 This study will be significant for decision maker or managers of the company and
entrepreneurs.
 It helps to complete the partial fulfillment of the requirement for the degree of BBS.
1.6 LIMITATION OF THE STUDY:
The main focus of the study is to evaluate the capital structure of Nabil Bank Limited. The
area of the study of this bank is a little vast, so there are certain limitations of this study.
Basically this study is subjected to following limitation.
 The study has covered the data for only five years (from 2075 to 2080)
 Since this study deals, mostly with Nabil Bank Limited, the conclusion derived from
the study may or may not be applicable to other similar bank or financial
institutions.
 The study is based on the facts collected from the annual report of Nabil Bank.
 Another limitation of the study is the accuracy of this study which is based on true
response and the data made available by the company.
1.7 REVIEW OF LITERATURE

Review of literature means reviewing research studies or other relevant propositions in the
related area of the study so that all the past studies, their conclusions and deficiencies may
be known and further research can be conducted.
1.6 FIELDWORK PROCEDURES/ METHODOLOGY

Research Design
The study aims of portraying accurately upon the capital structure of Nabil Bank. In order to
conduct the study, the descriptive and analytical research design has followed. In order to
achieve the objectives, the following methods are used in the study. The data are collected
from the ‘ Annual Reports’ that is a secondary source. The study attempts to have the answers
for the following questions.
Nature and Sources of Data
Basically there are two types of data in research. Primary and secondary data .
Primary data: To achieve the objective of this study primary data has been used. Primary data
have been taken through interview with financial manager Nabil Bank, Kantipath, Kathmandu.
Secondary data:
Secondary data had taken mainly from the published annual report, unpublished financial
statement and official website of Nabil bank (e.g. www.nabilbank.com) and other necessary
data were collected from other journal articles, magazine, business related billets.
Data Collection Method
Generally data has been collected through primary and secondary sources here the sources of
data collection is mostly secondary. The primary data has used through the oral interaction
with the assistant officer of Nabil Bank. The secondary data has used in this study mainly from
the Annual Report of the Nabil Bank, balance sheets and Website of Nabil Bank:
www.nabilbank.com.
Data processing
This study aims to have a descriptive analysis with percentage ratio along with trends of the
variables. The capital is classified in capital, reserve, borrowing, deposits and current liabilities.
The analysis is based on the functions trend of the total liabilities and its components is
compared with average growth rate.
Tools Used
Data collected from various sources have been managed, analyzed and presented in proper and
systematic way. To analyze the collected date financial and statistical tools have been used.
Financial tools such as Net profit tax, gross profit, earning per share etc. have been used.
Statistical tools used in the research are; average, standard deviation, coefficient of variance,
correlation of coefficient and index trend has been used. Tools used in the research are:
i. Average Mean
It is the sum of observation dividend by the NO. of observation or the no. of years. It
is denoted by x, where is x is given data and n is number of observation.
ii. Standard Deviation (SD)
The positive square root of the mean of the square of the deviation taken from the
arithmetic mean. It measures the relative measures of dispersion i.e the values
disperses from their respective means. It is denoted by ‘o’.
iii. Correlation (r)

The correlation coefficient between two or more than ywo variable is known as
correlation coefficient. Value always lies between -1 and +1 denotes the perfect
positive correlation between the variable and -1 denotes the negative correlation
between the two variables.
iv. Index Trend
Index trend is calculated by taking the first year index trend as 100.
IT= Trend year amount/ present year amount *100
v. Yearly Change in Percentage

Yearly change in percentage is calculated as:
YCP= Previous year index – present year index/ Previous year index *100
vi. Earning Per Share (EPS)

Earning per share is calculated as net profit dividend by no. of share
EPS= Net profit dividend/ No . of share
1.8 Organization of the study

The whole study is divide into four chapter plans which are follows:
Chapter I : Introduction
This part includes introduction, a brief profile of Nabil Bank Ltd. statement of the problem,
significance of the study, objective of the study, limitation of the study, chapter scheme.
Chapter II: Research Methodology

This chapter includes with introduction, research design, sources and nature of data, data
gathering instruments and analytical tools and techniques used.
Chapter III: Data presentation and analysis

This part deals with the presentation and analysis of data with the help of various tools and
techniques of capital structure as well as major findings of the study.
Chapter IV: Summary, Conclusions and Recommendations

This chapter includes summary, conclusions for finding and recommendations for further
improvement.
BILIOGRAPHY
Banking, Principles legislation and practice – Khadka Sherjungand Singh

Hyrdabir2.
Basu, Ak (1975), “Fundamental of Banking Theory and Practice”.3.
Commercial Bank Act. – Ministry of Law4.
Essential of Managerial Finance – (Western and Brigham) ninthedition5.
Text Book of "Business Mathematics & Statistics" - A.K.Chaudhari & G. D.

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A Project Proposal

Capital Structure of Nabil Bank

T. U. Registration No: 7-2-151-83-2019

A Project work report

Research Management committee

PUSHPALAL MEMORIAL COLLAGE

In partial fulfillment of the requirements for the degree of

Bachelor of Business Studies (BBS)

1. Background of the study……………………………………………………………………………. 1

1.5 RATIONAL OF THE STUDY:

1.7 REVIEW OF LITERATURE

1.6 FIELDWORK PROCEDURES/ METHODOLOGY

Nature and Sources of Data

iii. Correlation (r)

IT= Trend year amount/ present year amount *100

v. Yearly Change in Percentage

vi. Earning Per Share (EPS)

1.8 Organization of the study

Chapter II: Research Methodology

Chapter III: Data presentation and analysis

Chapter IV: Summary, Conclusions and Recommendations

Banking, Principles legislation and practice – Khadka Sherjungand Singh

Basu, Ak (1975), “Fundamental of Banking Theory and Practice”.3.

Commercial Bank Act. – Ministry of Law4.

Essential of Managerial Finance – (Western and Brigham) ninthedition5.

Text Book of "Business Mathematics & Statistics" - A.K.Chaudhari & G. D.

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