LIQUIDITY POSITITON OF RAJ SHREE SAVING AND INVESTMENT CO-OPERATIVE SOCIETY LTD, MILLS AREA,

JANAKPURDHAM, DHANUSH

BYPRASHANN RAJ KARN

EXAM ROLL NO-T.U. REGD NO-

A FIELD WORK REPORTSUBMITTED TO

RAMSWARUP RAMSAGAR MULTIPAL CAMPUS, JANKPUR

TRIVHUVAN UNIVERSITY

In partial fulfillment of Requirement for the degree of Bachelor of Business Studies.

Jankpur, 2067

FACULTY OF MANAGEMENT

TRIBHUVAN UNIVERSITY

RECOMMENDATION

This is to certify that the project work assignment report

SUBMITTED BY

PRASHANN RAJ KARNEXAM ROLL NO -T.U. REGD NO-

ENTITILED

LIQUIDITY POSOTION OF RAJ SHREE SAVING AND INVESTMENT CO-OPERATIVE SOCIETY LTD.

Has been prepared as approved by this department.This project work assignment report is forwarded for

examination

Date:………../…../….. ……………..Supervisor

…………….

Head of Department

R.R.M. Campus, Jankpur dham

ACKNOWLEDGEMENTThe subject matter of my project work report is on " Liquidity

position of Rajshree Saving and Investment Cooperative Society Ltd" This report has been prepared and submitted to meet the partial requirement of B.B.S 3rd year program and project management under the elective area designed by faculty of management, Tribhuvan University. This is my first experience from. Firstly I become worried how to prepare report, as it was unfamiliar to me Although I started it to prepare, related information are acquired from different sources , as a result enable to prepare this report.

It instills in us both practical and theoretical knowledge. This project work assigned is related to the activities relating to a case study on Liquidity position of Rajshree Saving and Investment co-operative Society Ltd. mills area, Jankpur. In this report it is strive to give the suggestion identifying good and bad things after studying and analyzing activities to liquid position. In the process of data simplification and analyses tables and diagrams are used to make clear concept.

Preparation of this report is really a challenge one and it was possible only with the proper guidance of our project management teacher shri. Jagrnath choudhary . I express my special thanks to him. After than, I would like thank to Mr. chandan karn of finalizing this report writing.

PRASHANN RAJ KARNB.B.S 3rd YEARROLL NO-R.R.M. CAMPUSJANAKPURDHAM

ABBREVIATION

R.R.M.C. : Ram Swarup RamSagar Multiple CampusT.U. : Tribhuvan UniversityB.B.S. : Bachelor of Business StudyN.B.B.L : Nepal Bangladesh Bank LimitedFY : Fiscal Year% : PercentageFig : FigureN.R.B. : Nepal Rastriya BankB.S. : Bikram SambatB.C. : Before the birth of ChristRSICSL : Raj Shree Saving and Investment CO-Operative Society LimitedDept : DepartmentINT : InterestNRs. : Nepalese RupeesMgmt : ManagementRedg. : RegistrationHMG : His Majesty Government

NBB : Nepal Bangladesh Bank

Table of ContentsCHAPTER-1 PAGE NO.1. INTRODUCTION1.1 Background 11.2 Focus of the study 31.3 Purpose /Objective of the study 31.4 Need of RSICSL Bank 51.5 Study of the Organization Structure 61.6 Limitation of the study 71.7 Project Works Procedures 71.8 Literature Review 81.9 Methodology of the study 8

CHAPTER -22. Data Presentation and Analysis2.1 Meaning of Liquidity 102.2 Important of Liquidity 102.3 Criteria for measuring bank Liquidity 112.4 Ratio Analysis 11

a) Deposit Investment Ratio 11b) Current Ratio 13c) Fixed Deposit to Total Deposit 15d) Saving Deposit to Total Deposit 16e) Current Deposit to Total Deposit 18f) Cash and bank to Current Assets 19g) Profitable 20h) Remittance 20i) Cash Reserve Ratio (CRR) 21

CHAPTER-33.1 Summary and Conclusion 223.2 Suggestion & Recommendation 23

Bibliography & Appendix

Chapter-11. Introduction1.1 Background

Banking has comet to the present advances from stages. Some sort of banking activities has been carried out since the time immemorial. Traditional from of banking faced during the civilization of Greece Rome and Mesopotamia. There is no unanimity among the economist about the origin of the word" Banking ". The term banking has been derived from the Latin word "Banco" which to the bench or which the banker would keep it money and his record. Some persons touch its origin to the French word "Banque" and the Italian word "banco" which means a bench for keeping, lending and exchanging the money and coins in the market place by money lenders of money chargers.

Though goldsmith, merchants and money lender arte said to be ancestors of modern banking, banking history stared from 12th century. the ancient Rome of the 5th century BC has practice of various of banking function which are similar those of modern banking system in 7th country the use of commercial instrument was recorded.

The "Bank of Venice" was the first public banking instruction established in 1157 A.D. in Venice, Italy, "Bank of Barcelona" and "Bank of Geneva" established in 1401and 1407 A.D. After the long passage "Bank of Amsterdam was established in 1609 A.D. This Bank was the great bank of 17th century. "Bank of England" established in 1694 A.D. was the first bank to work as the position of central bank and to develop the fundamental of central banking, which are under operation. The 20th century observed deserved development of various Banking institutions highly specialized sophisticated, particularly in advance countries like USA, UK and others.

In Nepal, the origin of commercial banking activities can be traced ancient Nepal. The institutional from of commercial banking activities has been performed at the first instance by the establishment of "TEJARATH ADDA" during the period of Ranodip Rana prime minister of Nepal. The growing necessities of the commercial bank" RAJSHREE SAVING AND INVESTMENT CO-OPERATIVE SOCIETY LTD" was established in 2052 B.S. since, Nepal being abd agro based country first "AGRICULTURE DEVELOPMENT BANK" was established in 2024 B.S. for the well development of agriculture sector.

Meaning and Introduction:It is difficult to give the meaning of Bank because it is related with

various works. So in ordinary since, the institution which is related with the dealing with money is called Bank.

The bank which is established with the purpose of providing help in the country industries and commercial trade area is sewed as commercial bank. Actually the origin if bank is commercial bank. Banks are important for acting different subsidiary roles like foreign exchanges, issue of credit, remittance, clearance etc.

In fact, present banking system is the result of the development of many countries. When we talk of the wonder scientific invention, banking also comes to as wonder of the modern world, It would be necessary to see as true how the banking has come to it present stage and what were the period to hope and despair through which the banking system had to past to come its present stage.

This bank is an institution which deals money receiving it an deposit from customer, honoring customers drawing agents such deposit on demand, collecting cheque for customer and lending until they are required for repayment.

In such a situation when the number of commercial bank are increasing at higher rate it would be quite appropriate to analyze and assess the press and cons of operating performance of RAJSHREE SAVING AND INVESTMENT CO-OPERATIVE SOCIETY LTD.

Background of Rajshree Saving and Investment Cooperative Society Ltd, Branch office-mills area Janakpur.

Realizing that NBL, established in 1994 B.S. along was notable to extend adequate services to the country in term of commercial Banking. Rajshree saving and investment co-operative society Ltd (RSICSL) was set up in 2052 B.S. As time passed the banking services and financial activities this bank was established under" Commercial Bank Act 2051 B.S." Its journal of 2060 shows the following details.Authorized capital 1 croreIssued capital 50 LakhsPaid up capital 25 LakhsTotal assets/ liabilities 67 LakhsTotal deposit (Ashadh) 39 LakhsLoan provided (Ashadh) 26 Lakhs

No. Of staff 160No of branches 7No. of occupied district 5Source: - RSICSL Branch office, mills area janakpur

1.2 Focus of the StudyAs we know that the RSICSL is controlled by the direct supervision

and direction of board of director which comprises of five personalities RAJSHREE bank holds good positioning the banking field of Nepal. It has occupied a board range i.e. trade, industry, agriculture etc. So financial analysis of RSICSL is essential for everyone to know.Mainly, the analysis in this study can show the: Liquidity position" of RSICSL city office Jankpur. It gives the clear description about the Liquidity. What is Liquidity? What is its importance? What is its objectives? Why it is managed? Also, how much Liquidity assets are available with firm? etc are the main subject matter of the study.

1.3 Purpose/ Objective of the study :The main of this case or study is to have deep knowledge and idea

about the subject chosen i.e. Liquidity position. It has also been prepared of fulfill the necessity or requirement for prescribed "project work study under B.B.S. level examination.

To analysis and assets valuation liquidity position of RSICSL.To evaluate the loan investment of RSICSL.To find out the deposit investment ratio of RSICSL.To find out actual liquidity ratio of RSICSL .

i) To identify the trend : Table No-1 Liquidity in RSICSL , Jankpur

Year Liquidity in RSICSL, janakpur

Aggregate Liquidity money in RSICSL

% of liquidity money covered by RSICLS

2058/591675 61034 2.712059/602408 77948 3.092060/612407 85747 3.042061/622775 86147 3.232062/632975 88002 3.38

Source: - RSICSL Branch office, mills area, janakpur

DIGRAM NO -1Liquidity postion of RSCSL janakpur

Fiscal Year

b) To identify the problems of (RSICSL,Jankupr):-During the study period in RSCISL Jankpur, it has been fell that bank

has been facing some internal and external problems.

Internal Problemsi. Management problemii. Banking technology problemiii. Service quality problemiv. Staff behavior problemv. Delay in work problem

External ProblemI. Sluggish economic growthII. Banking technology problemIII. Political instabilityIV. Scattered marketV. Potential influencesVI. Difficult control

Rupe

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c) To access resources:Table no-2

Ownership classification of deposit of RSICSL Janakpur for Ashad 2067Depositors Deposit Amount % of covered by

DepositorsMunicipality & VDC 3396 0.48ADB/N 3275 0.46Rastriya beema 982 0.14Sanshan 2657 0.38Government crop 765 0.11Industrial 1239 0.18Commercial 692,699 98.11Individual 968 0.13OthersTotal 705989 100Source : RSICSL Branch office, mills area, jankpur

Among the depositors individuals have covered highest percentage i.e. 98.11% and other covered as 0.13%.

1.4 Need of RSICSL BankRealizing that NBl, established in 1994 B.S. along was not able to

extend adequate services to the country in term of commercial banking RSAICSL bank was set up in 2052 B.S. As time passed the banking services and financial activities spread both urban and ruler areas. At that time in 2053 B.S. a branch RSICSL bank set up at janakpur with a view o performing following activities :

I. Formation of adequate capitalII. Availability of creditIII. Regional balanceIV. Safe custody of wealthV. Exchange of foreign currencyVI. Promotion of trade and industryVII. Control and regulate money managementVIII. Economic development etc.

1.5 Study of organization structure a) Capital structureThe figure mentioned in topic i.e. the journal of RSICSL 2067 has to

charged to great extent up to 2052 Ashadh, whit in a period of 10 years. Rapid growth in economy and lining standard of people caused broadening of its working fields up to 2060 Ashadh, the above mentioned figure has come to the following conditions.

Table no -3Capital Structure

Authorized Capital 147.23 crorePaid up capital 14724 LakhsTotal assets/ Liabilities 43 ArabTotal deposit 38 ArabLoan in advance 27 ArabNo. of Staff 5520No.of Branch 113No .of Occupied Zone 14

This data shows a vast improvement has taken place inside RSICSL with in 10 years. Since it's established, it has increasing the number of branches (Ashadh 2053) in total; which are specified in above table. Today we are going to study the branch office of janakpur among 10 branch of Jankpur zone.b) Organization and Management

The organization of RSICSL sis controlled by the direct supervision and direction of board of directors which comprise of personalities. Mr. Ramprit Mahato as branch manager, holds the highest position in management in, there are 5 supervision offices ; sub- ordination offices, sub- ordination central offices, which control the 10 branches all over the country.The organization structure of RSICSl mills area as a whole is all given below.

The organization structure and staff placement of RSICSL city office branch, mills area which rank was placement is presented in appendix.

The following mentioned list shows rank was placements of staff involved in RSICSL mills area.

Branch ManagerAssist. B managerSenior AssistantAssistantCash CounterGold silver listingSecurity guardPeonSweeper

Rank765543321

No112173421

Source :- RSICSL Branch Office, mills area jankpurWith the aim providing best and advance folwoing to its customers,

it has started its activities. Its activities are being performed by banking office with total of 46 staff working is RSICSL, Jankpur1.6 Limitation of Study

The limitation of the project work study is given below:-a) The study focus on daily liquidity position of RSICSLb) The study is concerned with only the branch of the institutionsc) The data available from secondary source are not far the institutiond) Unavailability of sufficient data resources (i.e. no. publication of

banking report) also limits the study.e) Making project work report is too expensive.

1.7 Project works ProceduresProject work report is the first report writing in BBS program. When I

know must write a project work report, it is difficult to me. I am thinking a long time how does it write but when our teachers took an orientation class and they learnt to us. He suggested to me. So, there are following procedures write project work report.Procedures;

I. To take orientation classII. To know how does its write in orientation class ?III. To receive authority letter from campus to collect information

and data to related articles of Organization.IV. To write project work report in copy.V. To check from related teacherVI. After checked it is printed by computerVII. Then to submit it's in management department considered with

memo of 200 rupees.

VIII. To submit one copy print for examination and two copies print for campus.

1.8 Literature Review This project work report is only possible with the help of different

newspaper text book and other reference books. The study of banks annual report and bank's manual proves very helpful in its Competition. Hope this project work report will be very Satisfactory.

1.9 Methodology of the Studya) Primary Datab) Secondary Data

a) Primary Data Questionnaires + Interview

During the research period, I held interview with some of officers and staff, the interview is as a follows:-Question to Branch Manager , mills area, Jankpur

1. How do you select Staff?Ans - At first only those application are chosen which have high education, experience and good knowledge and good knowledge about their job & open minded. Then we inquire their qualification and experience by the means of written exam and oral interview. Generally staffs are appointed by the central offering vacancies and they are posted to different branches according to the requirement.

2. How do you motivate your Staff?Ans- We motivate our staff by increasing their salary, increasing their promotion, by understanding their problem, by providing different facilities like Loan, Insurance etc.

Question to Administrative Officer1. How do you present the liquidity position of Branch?

Ans- We have to good availability of sufficient liquidity money which is being collected from daily customers. And I think Liquidity position of our branch is good conditions.

2. But more Liquidity is the symptom of sluggish economic growth, what do you about it?

Ans- It is not wrong to say that excess availability of liquid assets is the symptom of sluggish economic growth, but in a competitive market at current situation those banks loss their reputation and trust of customers who are not able to make current payment to account holders and loan takers, which is only possible due to good liquidity.

3. What strategies are you going to apply to eradicate their weakness?

Ans - Now we are going to follow the policy of re investment in unproductive sector deposit are accepted from a branch and they are invested in other regions where they can be mobilized efficiency, under theis policy.

Question to the customers1. Are you satisfied with opening bank account in RSICSL ?

Ans- Yes, I am satisfied.

2. Why do you prefer this bank than others?Ans- Because, it is a government bank which is trust able and there is very low chances of being insolvent of this bank.

b) Secondary data :-I. Balance sheet of RSICSL (2063 to 2067)II. Data from Internet website :

Chapter-2

2. Data Presented and Analysis

2.1 Meaning of liquidityLiquidity is the part of the assets, which can be used to meet the

obligation. The degree of liquidity of depends upon the relationship between cash assets plus those assets which can be quick money stock of economy.

In Nepal, "Liquidity" denotes the money in use in, in the current A/c , Saving A/c, and the money in margin A/c of the economy system. In general term, the aggregate money stock exiting in economic is called Liquidity. According to commercial bank Act-2031 total deposit in bank, balance in NRB and assets declared by NRB as bank's capital to pay cash in exchange deposit. The cash balance and securities that can be converted into cash within a very short period are called asserts. This all shows the Liquidity of bank.

2.2 Important of LiquidityThed important of liquidity is concerned very sensitive because

if it can't maintain the liquidity, it has to pay fine So, there is no disputes that Liquidity is the most important things for a bank. Liquidity management is the most important key term in respect of management of assets and Liabilities. Hence, the important of the liquidity is briefly described in points wise:

I. To meet the expenses for the banks daily administrative work.

II. To control the economic fluctuation and to keep safe from risk.

III. To fulfill the demand of the debtors.IV. Provide security to bank.

2.3 Criteria for measuring bank LiquidityLiquidity is and important aspect of bank. The state of Liquidity of a

bank depends upon several external factor i.e. going rate of interest, demand and supply of loan saving and investment fluctuation in size of financial market.The bank should be able to keep the liquidity in balance. The bank liquidity can be measured by following criteria:

I. Deposits investmentsII. Investment in assets

III. Investment in loanIV. Cash reserve ratioV. Structure of bank

2.4 Study of organization structure

2.5 Ratio Analysis (Calculation and Analysis for Liquidity)Ratio analysis is used to interpret the financial statement i.e.

Strengths reawaken of firm in context of historical and current financial condition. We have different types of ratio. Among them following are used to present the liquidity.

2.6 A Deposit Investment Ratio (DIR)Deposit investment ratio shows the amount in bank after providing

Loan of deposit collected. According to "Deposit mix strategy", Current account, saving account, fixed account need 100 %, 30-40% and 5-10% of Liquidity assets respectively. But in cash balance i.e. deposit investment ratio, it requires only 20 % of Liquidity.

DIR= Total deposit - Total loan providing 4 ×100Total deposit

Table no-4 F.Y/Particulars Deposit collectionLoan Providing Rate %2061/0622062/0622063/0642064/0652065/066

5,11,9781,32,0661,27,4564,38,4653,97,054

2,11,22074,61197,2512,72,7362,24,145

58.7443.5023.7037.7843.54

Source: RSICSL Branch office mills area jankpur.

Deposit collection = Fixed Deposit + Current Deposit + Saving Deposit

Loan providing: - Primary loan providing in different sector. The above table shows the liquidity position of bank in different financial years. In every year, there is not lack of liquidity, but n excess quantity. The bank only requires 20% of liquidity. It shows that the excess liquid money in bank is unproductive for it. Lower the value of profit so, it can be said that the liquidity position is not better. To decline this weakness, central office has adopted the policy of disinvestment in unproductive sector. Now the above mentioned data are presented in diagram below.

Diagram no-2Deposit Investment Ratio

2,11

,220

.

74,6

11

97,2

51

2727

36

2,24

,14

5

5,11,9781,32,0661,27,4564,38,4653,97,054

2.4 B Current Ratio:This ratio shows the short term solvency of bank. It is the

relationship between current assets and current liabilities. Current assets include cash and bank balance, sundry debtors, bills receivable, interest accrued and demand draft. Current liabilities include bills payable, sundry creditors, outstanding expenses, risk bearing expenses etc. A bank should require maintaining 2:1 ratio.

Current Ratio = Current Assets . Current Liabilities

Table no-5 Current RatioF.Y/Particulars Current Assets Current LiabilitiesRatio2061/0622062/0622063/0642064/0652065/066

227147164042264753108039146449

7079550797352271342117497

3.213.237.518.058.37

Source: - RSICSL Branch office mills area, janakpur.The above table shows the short term solvency of bank in

2061/2066 current ratio is 2.99 it shows the sufficient liquid assets. Though it is not less than the required standard ratio i.e. 2.1 the access ability of current assets is not good for bank. The maintains the excess amount as ideal amount. However the condition is improving there after. The above data shows in diagram plotted as follows:

Diagram no-3Current Ratio

Fiscal year

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2.4 c Fixed Deposits to Total DepositHigher fixed deposit shows the higher liquidity. The ratio is

calculated to find out the percentage of fixed deposit with respect to total deposit. According to "deposit mix strategy" balance can used to support the demand of liquidity money for the bank.

Fixed deposit to total = Fixed depositTotal deposit

Table no -6F.Y./Particulars Current assets Current LiabilitiesRatio2061/0622062/0622063/0642064/0652065/066

1525071212811385107848930

511978132066127456134808148848

0.300.100.090.080.06

Source: RSICSL Branch office mills area, Janakpur.

The table shows the decreasing ratio of fixed deposit with respect to total deposit, which clarified the declining Liquidity condition of the bank.The fixed deposit is long term liability. Higher current liability causes lower liquidity. The above mentioned data are plotted in diagram as mentioned above.

Diagram no-4Fixed deposit to tatal deposit

Fiscal year

2.4 D Saving Deposit to total depositThis ratio is calculated to find out the percentage of saving deposit

with respect to total deposit. Higher saving deposit shows the higher liquidity . According to " Deposit mix strategy" , saving deposit needs 30 or 40 percentage of hot money and balance is maintained as liquidity assets .

Saving deposit to total deposit = Saving deposit Total deposit

Table no -7 Saving deposit to total depositF.Y./Particulars Saving Deposit Total Deposit Ratio2061/0622062/0622063/0642064/0652065/066

318095113170111474124023139917

511978132066127456134808148848

0.610.860.880.920.94

Source :- RSICSL Branch office mills area , Jankpur

The table shows the increasing ratio of saving deposits with respect to total deposit which clarifies the developing liquidity condition of bank saving deposit is also long term liability and higher long term liability in diagram on presented above.

Diagram no-5Saving Deposit to Total Deposit

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2.4 E Current Deposit to Total DepositThis ratio is calculated to find out the proportion of current deposit

with respect to total deposit. Higher current deposit shows the higher liquidity . According to "Deposit miz strategy" current deposit needs 100% of hot money.

Current deposit to total deposit = Current deposit Total deposit

Table no -8Current Deposit to total deposit

F.Y./Particulars Current Deposit Total Deposit Ratio2061/0622062/0622063/0642064/0652065/066

413766768459640442976

511978132066127456134808148848

0.080.050.040.030.02

Source :- RSICSL Branch office mills area, Janakpur dham

The above table shows the decreasing ratio of fixed deposit with respect to total deposit. It means the liquidity condition from this point to view is in the developing condition. Current deposit is short terms liabilities . The above data in diagram plotted as follows :-

Diagram -6Current Deposit to Total Deposit

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Fiscal year

2.4 F Cash and bank to current assetsThis ratio is calculated to find out the percentage of the liquid

money which is necessary to make immediate payment to the account holders . cash and bank balances as being the hot money are the most liquid holders. It is needed necessarily in the bank at any time.

Cash and bank to current assets = Cash and bank balanceCurrent Assets

Table no-9 Cash and bank to Current assetsF.Y./Particulars Cash & bank

BalanceCurrent assets Ratio

2061/0622062/0622063/0642064/0652065/066

17072512572717544074547108372

224147164042264753108039146449

0.750.770.670.690.74

Sources :- RSICSL Branch office mills area , Janakpur

The above table shows that the bank holds adequate cash. Cash and bank balance are very significant to make immediate payment. But the cash and balalnce with RSICSL is too much, which is not profitable for bank. Now the above are presented in diagram below :-

Diagram no-7

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Cash and Bank to Current Assets

Fiscal year

2.4 G Profitable RSICSL is a commercial institution having profit motive . It provides

different services to its customer and services to its customer and services charge in rturn. Bnak changes interest on its leading and pays interest on deposit collected. But it accepts deposit at a low rate and provides loan out higher rate . This different between amounts of interest is gross profit and residential amount of after deducing operation expenses is net profit . Higher profit causes higher liquidity. Interest Rate of Acceptance and leading.

Particulars Interest on deposit Interest on loanCurrent A/c – -Saving A/c 2.5 % 8.5-12%Fixed A/c 4% -Source :- RSICSL circular, Magh 2061

2.4 H Remittance Different modes of remittance are available with bank to trnasfer

money from one place to another place. The amount, which is deposited in bank to send it to another branch, is called remittance outward . This money remains in bank as liquid assets for a specified period as the other hand the amount of cheque or draft which is deposited into bank for collection, are remittance inward. As remittance inwards increase , the liquidity of bank decreases .

Table No:- 11Remittance

F.Y./ Particulars Remittance inwardRemittance Net

outward2061/0622062/0622063/0642064/0652065/066

13556701347667142017025460064724926

11764801076470118052022263964443896

179190271197239650319610281034

Source :- RSICSL Branch office mills area janakpur

According to above table, that represents the inward remittance is higher than outward remittance. It means bank should be kept more liquidity to payment of inward remittance. For liquidity purpose, remittance should not be more difference, but this bank should be remittance to profit and liquidity. The table shows inward remittance is grow coming year. The above data in diagram is plotted as follows :-

Diagram No-8Remittance

Fiscal year

2.4 I Cash Reserve ratio (CRR)RSICSL Jankpur annually maintains a sum to 8% its total

deposit as cash reserve ratio. This amount must be deposit in RSICSL, which is the most significant for its durable future. Otherwise central bank

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charges penalty fees to the bank. This bank has also maintained 4% at its on reserve as cash in vaults .This makes us cear that this bank has sufficient liquid money to maintain statutory liquidity ratio. Sufficient liquid money to maintain statutory liquidity ratio. Sufficient liquid ratio is also a source of liquid in cntigency.

CHAPTER -33 Summary Conclusinon and Recommendation3.1 Summary and Conclusion

This chapter deals in summary and conclusion of this study of "Liquidity position of RSICSL janakpur" . It deals the liquidity position about the RSICSL janakpur. The financial statement of five years i.e. from 2061 to 2065 have examined for the purpose of study. The liquidity position of RSICSL is admirable as its profit earining is increasing each year. This shows the bank is in increasing trend beston the finding of anlystical tools same conclusion have been derived from the financial years, which are as follows :-

I. Deposit investment ratio is favorable but is too much higher then required standard. This excess liquidity is also responsible for low profit.

II. Current ratio of RSICSL shows the strong liquidity position but it indicates the lower mobility of current assets , which is not good for a financial institution.

III. The ratio of different deposit to total deposit shows an excellent result because currnet deposit is eligible comparing with fixed a saving deposit.

IV. Cash and bank balance has been rising by per F.Y. which creates a hopeful situation.

V. Rate of profitability is low which is painful .But it is out come of marinationg more liquid assets ans ideal than required standard.

VI. There is not any question mark with rtespect to remittance with the help of above analysis. we can conclude that the liquidity position of RSICSL, janakpur is not satisfactory. Besides there mathematical tools, I ave used "SWOT" analysis which also indicates unsufficent but ineffective liquidity.

Here" SWOT" meansS = StengthW = WeaknessO = OppirtunityT = Threat

Strength :During my study period, I have found RSICSL janakpur , strength are

as follow:I. It has moderately strong financial position.II. Large no of account holder.III. Large market size.

Weakness :I. It has not computerized system.II. Ratio modern is not introduced in branch.III. It has a rented building.

Oppotiunity :-Having competation , scattered market size, sluggish economic

growth, plitical instability, wrong polices of RSICSL, bad wanes mushrooming of financial institution are the threat of this bank.

3.2 Suggestion and Recommendation :-There are some suggestin and commendation , which are being

derived from study .As per availability facts :

I. Since the liquidity form the viewpoint of profitability is not satisfactory, the bank is suggestion to utilize its total assets

effectively to earn adequate profit because immobilized assets are also responsible for low profit.

II. To increase the efficiency of staff, the management should provide on the job and off the job tranning methods.

As per domparision :Newly established bank are over taking RSICSL so precaution must

be made in time. Not only this, adequate pulicity and advertising should be made to inform and attract customers and people. Modrn technology should be initiated for the customers to rapid in work.

Suggestion to T.U. All the bank and financial instituation must be requested by T.U. to

cooperate the students and to publish different ariticles.

BIBLIOGRAPHYI. Karyaliya xoochi, RSICSL (2064)II. Banking khabar patra ,2064 (Shrawan /Bhadra)III. Documentsfrom department ofplanning and research (RSICSL)IV. Annual publication of NRBV. Economic indicator of NRB , mid July 2007VI. Credit manual of RSICSLVII. Karn chandan & Dhausha computer , VIII. Adhikari, K.P 91998) project management evaluation system in

nepal.IX. Agrauwal/ G.R. - Project management in nepal m.k. pubication

and dijtributod KTM.

APPENDIXSCHEDULE (A) :- Current LiabilitiesSCHEDULE (B) :- Current Assets and total assetsSCHEDULE (C) :- Loan Advance and overdraftSCHEDULE (D) :- Total DepositSCHEDULE (E) :- Total cash Bank BalanceSCHEDULE (F) :- Organization structure and staff placement of RSICSL, city

office, mills area with rank wise placement.

SCHEDULE (A):- Current Liabilities F.Y.

Description

2063/064 2064/065 2065/066

1. Account payable8,09,67,000 8,15,85,000 1,08,78,0002. Other Liabilities 5,07,000 5,19,000 1,08,78,000Total 8,14,74,000 8,21,04,000 1,13,96,000

SCHEDULE (B) :-Current Assets & Total Assets F.Y.Description

2063/064 2064/065 2065/066

1. Current Assetsa) Cash in handb) Cash at NR bankc) account Receivabled) Other Assets Total Current Assets

83,47,0004,73,97,0006,92,47,00014,12,22,00026,62,11,000

86,24,0005,56,55,0006,82,44,00015,14,21,00028,39,44,000

13,84,0003,77,93,0008,92,65,00013,11,20,00025,95,62,000

2. Fixed Assetsa) Furniture & Fixtureb) Vehiclesc) Stationaryd) Other Fixed Asstes

23,37,0006,97,00062,0003,14,000

24,45,0006,44,00074,5003,12,000

22,53,0007,29,00046,0004,13,000

Total Fixed Assets 34,10,000 34,75,500 34,41,0003.Total Asset (1+2) 26,96,21,000 28,74,19,500 26,30,03,000SCHEDULE (C) :- Loan Advance and Over Draft F.Y.

Description

2063/064 2064/065 2065/066

1. Bank Over Draft5,79,37,000 6,47,40,000 1,06,49,0002. Cash Credit 3,37,87,000 4,11,26,000 3,47,82,0003. Term Loan 3,40,97,000 3,24,44,000 82,34,0004. Demand 2,02,06,000 2,07,11,000 2,03,08,0005. Others 99,37,000 56,34,000 9,40,95,000Total 15,59,64,000 17,46,55,000 16,80,68,000SCHEDELE (D) :- Total Deposit F.Y.

Description

2063/064 2064/065 2065/066

1. Current Account6,76,80,000 6,80,44,000 1,34,22,0002.Saving Account 11,31,70,000 19,32,50,000 27,34,96,0003. Fixed Account 1,21,28,000 1,24,27,000 1,34,80,0004. Special Term Deposit

10,35,27,000 8,35,24,000 11,35,22,000

Total 29,65,05,000 25,72,45,000 41,39,20,000SCHEDULE (E) :- Total Cash & bank Balance F.Y.

Description

2063/064 2064/065 2065/066

1. Cash in hand 83,47,000 86,24,000 85,34,0002. Cash at NRB 4,73,97,000 5,56,55,000 3,77,99,000Total 1,23,17,000 4,42,79,000 4,63,27,000SCHEDULE (F) :-

The Organization structure and staff placement of RSICSL branch office, mills area , jankpur with rank wise placement is presented as below :-

Branch ManagerAssist. Branch ManagerSenior AssistantAssistantCash CounterGold/Silver ListingSecurity guardPeonSweeper

Rank765543321

NO112173421

With the aim providing best and advance following to its customers, it has started its activities . It's activities are being performed by banking office with total of 46 staff working is RSICSL, Jankpur