CEDBL_Intern_Report

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CONTENTS
INTERNSHIP CERTIFICATE ISSUED BY THE ORGANIZATION
ACKNOWLEDGEMENT
LIST OF TABLE ................................................................................................................. i
LIST OF FIGURE................................................................................................................ i
CHAPTER: I ORGANIZATION PROFILE ...................................................................... 1
1.1 Profile of Clean Energy Development Bank........................................................ 1
1.2 Capital Structure................................................................................................... 3
1.3 Shareholders Structure ......................................................................................... 4
1.4 Organizational Objectives.................................................................................... 4
1.5 Vision ................................................................................................................... 5
1.6 Mission................................................................................................................. 5
1.7 Major markets and customers .............................................................................. 6
1.8 Products and Services........................................................................................... 6
1.8.1 Corporate Financing...................................................................................... 6
1.8.2 Deposit Schemes........................................................................................... 6
1.8.3 Mortgage Loan.............................................................................................. 6
1.8.4 Corporate service .......................................................................................... 7
1.8.5 Hydro Power & Micro Finance Loan ........................................................... 7
1.8.5 SME Finance................................................................................................. 7
1.8.6 Retail Finance ............................................................................................... 7
1.8.7 ATMs & Service Agents............................................................................... 8
1.9 Organization Design and Structure ...................................................................... 8
1.10 Financial Structure ............................................................................................... 9
1.10.1 Share Capital............................................................................................... 10
1.10.2 Reserve and Surplus.................................................................................... 10
1.10.3 Deposit Liability ......................................................................................... 11
1.10.4 Proposed Dividend...................................................................................... 12
1.10.5 Investment................................................................................................... 12
1.10.6 Loans, Advances & Bills Purchased........................................................... 13

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1.10.7 Fixed Assets................................................................................................ 14
1.11 Organization Performance.................................................................................. 14
CHAPTER: II JOB PROFILE AND ACTIVITIES PERFORMED................................. 17
2.1 Introduction to Credit Department..................................................................... 17
2.2 Credit Service Provided by CEDB..................................................................... 17
2.2.1 Personal Loan.............................................................................................. 17
2.2.2 Business Loan ............................................................................................. 20
2.3 Credit Flow Process ........................................................................................... 23
2.4 Activities Performed in the Organization........................................................... 23
2.5 Problems Solved................................................................................................. 25
2.6 Intern's Key Observation.................................................................................... 26
CHAPTER: III LESSONS LEARNT AND FEEDBACK ............................................... 27
3.1 Key Skill and Attitudes Learnt........................................................................... 27
3.2 Feedback to the Organization............................................................................. 28
3.3 Feedback to the College/University................................................................... 30
ANNEX
BOBLOGRAPHY

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LIST OF TABLE
Table 1: Capital Structure ................................................................................................... 3
Table 3: Key Indicators of CEDBL .................................................................................. 15
Table 5: Interest Rate on Personal OD Loan .................................................................... 18
Table 6: Interest Rate on Personal Vehicle Loan.............................................................. 18
Table 7: Interest Rate on Personal Home Loan ................................................................ 18
Table 8: Interest Rate on Foreign Employment Loan....................................................... 18
Table 9: Interest Rate on Personal Demand Loan ............................................................ 19
Table 10: Interest Rate on Margin Loan........................................................................... 19
Table 11: Interest Rate on Education Loan....................................................................... 19
Table 12: Interest Rate on Other Loans ............................................................................ 20
Table 13: Interest Rate on Business Overdraft ................................................................. 20
Table 14: Interest Rate on Short Term Working Capital Loan......................................... 20
Table 15: Interest Rate on Term Loan .............................................................................. 21
Table 16: Interest Rate on Hire Purchase Loan ................................................................ 21
Table 17: Interest Rate on Demand Loan ......................................................................... 21
Table 18: Interest Rate on Real Estate Loan..................................................................... 22
LIST OF FIGURE
Figure 1: Shareholders Structure ........................................................................................ 4
Figure 2: Organization Structure ........................................................................................ 8
Figure 3: Share Capital ..................................................................................................... 10
Figure 4: Reserve and Surplus.......................................................................................... 10
Figure 5: Deposit Liability................................................................................................ 11
Figure 6: Proposed Dividend ............................................................................................ 12
Figure 7: Investment ......................................................................................................... 13
Figure 8: Loans, Advances & Bills Purchased ................................................................. 13
Figure 9: Fixed Assets ...................................................................................................... 14
Figure 10: Net Profit......................................................................................................... 15
Figure 11: Return on Assets.............................................................................................. 16
Figure 12: Interest Rate on Other Business Loans............................................................ 23
Figure 13: Credit Flow...................................................................................................... 23
Figure 14 : Credit Flow Process ....................................................................................... 23

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CHAPTER: I
ORGANIZATION PROFILE
1.1 Profile of Clean Energy Development Bank
Clean Energy Development Bank Ltd. (CEDBL) was established in 2006 under Bank and
Financial Institution Act, 2063, in a joint venture with FMO – Netherlands. The bank
begun its operation on 07 September 2006 from its main office located at Sitapaila
Chowk, Ring Road, Kathmandu. CEDBL, including the banking services, also provides
technical know-how, project financing, pre-investment activities, investment and
corporate advisory services and mobilizes local as well as international resources to
promote clean energy activities within the country. The bank is promoted by Employees
Provident Fund, Energy Experts, Bankers, Professionals and other institutional investors.
The bank has won the ‘The Best Development Bank, 2010’ award from the Boss
magazine, ‘National Best Presented Accounts 2011’ award in Prudential Supervision
under Financial Sector category conferred by The Institute of Chartered Accountants of
Nepal (ICAN) and recently the bank has won Asian Paints Newbiz Award in the ‘Best
Managed Development Bank’ category for 2013.
CEDBL with the help of USAID came up with an innovative product, i.e. the CEDBL
Hydro Fund (CHF). This product raised NPR 230 Million from the general public and as
of today it stands extremely successful with over 100 MW worth of projects under
various stages of development. CEDBL believes that this endeavor will go a long way in
the development of hydro power and will be a major milestone for such progress in
Nepal. CEDBL has been actively utilizing its in-house capability brought in by its energy
experts for due diligence and feasibility studies of medium and small hydro power
projects. CEDBL formed a Strategic Partnership Agreement with Northwest Hydro
Consulting Engineers (NWH) - one of the world’s leading hydropower consulting
companies from China. The agreement envisions fulfilling techno-financial analysis and
a transfer of cost effective technology for medium and large size hydropower projects
bringing together the Bank’s in-house expertise and the vast knowledge of NWH in this
domain.

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CEDBL inked an agreement with the renowned Dragon Capital Limited, a company
based in Vietnam, for Mekong Brahmaputra Clean Development Fund (USD 100
million) for equity investment in hydropower projects. The agreement envisions
identifying, assessing and financing quality hydropower projects in Nepal and Bhutan.
CEDBL has attempted to resolve the underlying constraints in funding options for hydro
projects through local financial intermediaries in Nepal that is limited to investment
capabilities of a single 50 MW project or a total setup of 100 MW- by gaining access to
debt financing support for large hydro projects through the international financial
community. Accordingly, CEDBL is in the process of financing (NPR) 2 Billion on its
part to the 16 hydro power projects portfolio and is the lead bank in 12 of these projects.
CEDBL (CEDBL Hydro Fund Ltd.) signed an agreement with FNCCI, as per the Public
Private Partnership (PPP) model, for the development of micro & small hydro power
projects, ranging from 1 to 10 megawatts in capacity, in 45 districts across Nepal. This
vision of CEDBL for the empowerment of Nepal is to be accomplished by the year 2014.
Energy saved is energy created. In line with this vision CEDBL has taken an initiative to
build awareness, identify technologies and arrange resources in this direction, whereby
CEDBLL plans to create a position to save huge wastage of precious energy. To support
this initiative, CEDBL signed an agreement with International Finance Corporation
(IFC), a member of the World Bank Group, to train staff members to improve their skills
when evaluating proposals on energy efficiency and renewable energy financing, as well
as product development and marketing. It also involves engineering due diligence for
energy efficient projects, benefits from IFC’s initiatives in Nepal on energy auditor
development, market potential studies and targeted awareness with training activities
related to sustainable energy finance.
In addition, CEDBL has been working closely with GTZ-SHPP, AEPC, SNV and various
domestic and international donors and funding agencies for the development of clean

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energy production and uses. It has entered into an agreement with the Asian Development
Bank (ADB) for the development of Carbon Reductions and its trading.
CEDBL is pursuing a defined positioning strategy to build one of the finest financial
brands in Nepal and is striving to gain a reputation as a leader in the energy sector, while
maintaining sustainable banking operations. In the banking side of the business, CEDBL
has been successful in establishing highly reliable and customer friendly service
standards, comparable to the most prominent banks in Nepal, with an innovative range of
deposit and credit products. In addition to its Head Office in Sitapaila, Kathmandu,
CEDBL also possesses 9 branches throughout Nepal with 3 inside the Kathmandu valley
at Thapathali, Durbar Marg and Baneshwor and the remaining at Gorkha, Birtamode,
Phidim, Katari, Taplejung and Salleri. In terms of rural development, CEDBL has
extended its services to the rural areas like Phidim (Panchthar), Phungling (Taplejung)
and Katari (Udaypur) and is the first private financial institutions to be established in the
region. The rural activity of the bank has also been extended through partnering with
local financial institutions to provide services to the grass root levels of the economy by
providing solar home system loans (in Dailekh) and cattle financing ( in Gorkha). These
activities, in reality, have supported in building the brand CEDBL as a dedicated national
level bank.
1.2 Capital Structure
CEDBL has the Authorized Capital of NPR 1.1 Billion out of which NPR 1.088 Billion
are issued and fully paid-up.
Table 1: Capital Structure
Capital Amount (NPR)
Authorized Capital 1.1 Billion
Issued Capital 1.088 Billion
Paid-up Capital 1.088 Billion

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1.3 Shareholders Structure
Figure 1: Shareholders Structure
Regarding the shareholders Structure the issued share of CEDBL 56 percent of the share
is held by General public, local promoters acquire 30 percent of the share and remaining
14 percent is in the hand of Foreign Partners.
1.4 Organizational Objectives
CEDBL’s priority lies in serving the people and the nation, providing world class
banking products and services, providing technical expertise and investing in clean
energy sector to strengthen the economy of the nation.
The 6 folds objectives are as under:
1. to provide standard and reliable financial services to the general public by
protecting and promoting the rights and interest of all stakeholders
2. to bring about such financial resources, from internal and external sources, as may
be required for the establishment, development, expansion and enhancement of
capability and productivity of agriculture, industry, trade and other productive
business which appears feasible from business viewpoint, and render support for
56%
14%
30%
Shareholders Structure
Local Promoters Foreign Partner General Public

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bringing about dynamism in the development of industrial, trade and agricultural
sectors of the country
3. to establish, operate, develop, expand and promote manufacturing and
employment-oriented business in rural and urban areas, by properly utilizing the
available skills, labor and capital, to provide such financial resources, technical
and managerial consultancy service, training and technology as may be required
for the same, and be actively engaged in, and thereby render support for, poverty
alleviation
4. to provide financial services through institutional investment by integrating the
capital scattered in the country and fair competition
5. to provide mid-term and long-term financial means and resources as may be
required for investment to be made in the development of infrastructures of the
country in a businesslike manner, while remaining vigilant towards the protection
of environment
6. to mobilize and provide such mid-term and long-term capital as may be required
for the establishment, operation, protection and promotion of hydro-power,
renewable energy and other infrastructures and business related therewith, by the
private sector
1.5 Vision
To be the most preferred bank in creating superior financial solutions to satisfy
customers' needs and to promote sustainable growth of the society through investment in
clean energy and sustainable sectors in a manner that creates value for all our
stakeholders, the society, the environment and the coming generations.
1.6 Mission
CEDBL holds the mission to connect and empower customers, communities and global
partners to create a sustainable and energy efficient future through comprehensive and
innovative financial services delivered by a team of highly motivated and committed
team of professionals in the most responsive and friendly manner while ensuring our
investments promote sustainable growth of the economy through proactive risk

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management practice, good corporate governance, high degree of ethical integrity and
social responsibility.
1.7 Major markets and customers
CEDB customers range from individuals and small businesses to large corporate and
government. To sustain our business performance we remain responsive to the markets in
which we operate by understanding the customers’ different needs and providing relevant
products and services. To this end, CEDB maintain robust governance and risk
management frameworks to facilitate transparent pricing structures, responsible lending,
customer service and security.
1.8 Products and Services
Wide range of product and services are provided by the CEDB. They are
1.8.1 Corporate Financing
CEDB have been providing the entire range of business financial services such as project
finance, working capital loan, trade finance and foreign exchange management to the
corporate customers. Corporate Finance business philosophy is provided to customized
service/solution to each of the valuable customers. Under Corporate Financing CEDBL
provide Lease Financing, Term Finance, Short Term Finance, Working Capital Finance,
Work Order Finance and Factoring Finance
1.8.2 Deposit Schemes
CEDB have a number of deposit plans to suit the customer’s convenience and specific
requirements. CEDB ensure that customers enjoy good returns on their deposits and
bearing this in mind CEDB have floated many deposit schemes suitable for different
socioeconomic segments and financial status of the depositors. All the savings and fixed
deposit accounts of natural individual depositors of the bank are fully insured by Deposit
& Credit Guarantee Corporation up to NPR 2 Lakhs per depositor. CEDBL Provides
different Deposit Schemes like Periodic return Term Deposit, Recurring Term Deposit,
Tailored Savings and Call Deposit Schemes
1.8.3 Mortgage Loan
This scheme provides loan/overdraft facility against mortgage of property at low rate of
interest. The schemes is for people engage in trade, commerce & business and also

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professionals & self-employed, proprietorship firm, partnership firm, companies and
individuals with high net worth including salaried people, agriculturists and staff
members. Home loan and Real Estate Developers’ Finance are provided under Mortgage
Loan
1.8.4 Corporate service
Corporate banking reflects CEDB's strengths in providing the banks corporate clients, a
wide array of commercial, transaction and electronic banking products. CEDB achieve
this through innovative product developments and a well-integrated approach to
relationship management. Syndication of LeaseLoan, Corporate Advisory services and
Investment Counseling Corporate Service are provided by CEDB
1.8.5 Hydro Power & Micro Finance Loan
Hydro Project Finance & Micro Finance continues to remain a strong focus area for
CEDB as a tool to empower hydro sector & micro entrepreneurs in areas with relatively
low access to finance. Apart from wholesale loans that CEDB also provide small loans
directly to the end consumers of micro finance through various programs and schemes.
Hydro Project finance, Grid Connected Hydro Solutions, Solar Loan, and Micro finance
Loans are provided under Hydro Project Finance & Micro Finance.
1.8.5 SME Finance
CEDB believe in providing total financial solutions including financial advisory to small
business owners add values to their business. This approach helps the bank in serving
special groups of entrepreneurs, starts ups and second generation business owner who
require financial advisory as much as credit products. CEDBL provides SME Finance
and SME Advisory Service for small and medium business to empower the people.
1.8.6 Retail Finance
Retail finance serves a diversified base of customer’s salaried individuals, women, youth,
students, children, migrant workers, non-residents and high net worth individuals.
CEDBL promise is to deliver hi-tech and ecofriendly banking experienced to the
customers by providing Auto Loan for Individual and Institution, Personal Loan for
individuals for any Purpose, and Clean Transport Loan.

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1.8.7 ATMs & Service Agents
CEDB offers SCT branded ATM Card. These cards can be used in more than 1200
ATMs in Nepal for free, and nominal charges for third party card processing. Service
agent’s networks allow the bank account holds to deposit or withdraw cash through these
service outlets that result in financial benefit for the Agents and greater convenience to
the customers.
1.9 Organization Design and Structure
Headed by the Chief Executive Officer for overall management, the Bank has two
specialized divisions to carry out its vision and mission, i.e. Banking Division and Energy
Division. As a result, CEDB is efficiently managed by a team of dynamic professionals
with a proven track record in the banking and the energy sector.
BOD
RM
Committee
Audit
Committee
EMSF
Committee
Merger
committee
Company
secretary
CEO
Employee recruitment
Committee
Asset & liability
committee
Banking Division Energy Division
Figure 2: Organization Structure

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1.10 Financial Structure
The objective of financial statements is to provide information about the financial
position, performance and changes in financial position of an enterprise that is useful to a
wide range of users in making economic decisions. Financial statements should be
understandable, relevant, reliable and comparable. Reported assets, liabilities, equity,
income and expenses are directly related to an organization's financial position.
Financial statements are intended to be understandable by readers who have a reasonable
knowledge of business and economic activities and accounting and who are willing to
study the information diligently. Financial statements may be used by users for different
purposes:
Owners and managers require financial statements to make important business decisions
that affect its continued operations. Financial analysis is then performed on these
statements to provide management with a more detailed understanding of the figures.
These statements are also used as part of management's annual report to the stockholders.
Employees also need these reports in making collective bargaining agreements (CBA)
with the management, in the case of labor unions or for individuals in discussing their
compensation, promotion and rankings.
Prospective investors make use of financial statements to assess the viability of investing
in a business. Financial analyses are often used by investors and are prepared by
professionals (financial analysts), thus providing them with the basis for making
investment decisions.
Financial institutions (banks and other lending companies) use them to decide whether to
grant a company with fresh working capital or extend debt securities (such as a long-term
bank loan or debentures) to finance expansion and other significant expenditures.
Looking at the past five year’s balance sheet of CEDB it is seen that the firm is growing
and doing its business smoothly. Let’s look some of the major component.

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1.10.1 Share Capital
Figure 3: Share Capital
In the year 2008 CEDB had the share capital of NPR 224,000,000, in the next year it has
issued the share capital and rose up to NPR 320,000,000. Again in the year 2010 it has
again increased its share capital to NPR 521,132,080. In the year 2011 CEDB has again
issued the share capital and its total share capital is NPR 1,088,000,000. After this the
company has not issued any share capital.
1.10.2 Reserve and Surplus
Figure 4: Reserve and Surplus
0.00
200,000,000.00
400,000,000.00
600,000,000.00
800,000,000.00
1,000,000,000.00
1,200,000,000.00
15-Jul-08 15-Jul-09 16-Jul-10 16-Jul-11 15-Jul-12
Share Capital
0.00
20,000,000.00
40,000,000.00
60,000,000.00
80,000,000.00
100,000,000.00
120,000,000.00
Reserves and Surplus

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Reserve and Surplus is also in the growth trend. In the year 2008 CEDB has the NPR
241,973 as reserve and surplus, in the year 2009 the amount of reserve and surplus has
increased to NPR 21,118,375, but in the year 2010 the reserve amount has been
decreased to NPR 17,751,089, it is due to the payment of dividend to the shareholders. In
this year the company had first announced the dividend to the shareholders. In the year
2011 the reserve and surplus amount has increased to NPR 77,111,321 furthermore in the
year 2012 this figure has reached to NPR 107,458,500.
1.10.3 Deposit Liability
Figure 5: Deposit Liability
Deposit is the main source of generating the income of the bank. From the above date we
can see that the deposit of CEDB has been increasing. In the year 2011 the deposit
liability of the bank is somewhat equal to previous year. There is only 3.52 % growth in
the deposit based on year 2010. In the FY 2011/12 the deposit liability if the CEDB has
reached to NPR 5,364,362,859.00
0
1,000,000,000
2,000,000,000
3,000,000,000
4,000,000,000
5,000,000,000
6,000,000,000
Deposit Liability

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1.10.4 Proposed Dividend
CEDB has started distributing the profit share to its shareholders from the FY 2009/10. It
has distributed more than 100 percent of the profit i.e. NPR 48,000,000.00 in 2010. In FY
2010/11 the bank has proposed dividend of NPR 76,767,273.00. In the FY 2011/12
CEDB has distributed approximately 88 percent of its profit.
Figure 6: Proposed Dividend
1.10.5 Investment
Investment has different meanings in finance and economics. In economics, investment is
the accumulation of newly produced physical entities, such as factories, machinery,
houses, and goods inventories. In finance, investment is putting money into an asset with
the expectation of capital appreciation, dividends, and/or interest earnings. This may or
may not be backed by research and analysis. Most or all forms of investment involve
some form of risk, such as investment in equities, property, and even fixed interest
securities which are subject, among other things, to inflation risk. It is indispensable for
project investors to identify and manage the risks related to the investment. The main
target of CEDB is to make the investment in the renewable energy. For this the bank is
identifying and making investment is the viable hydro projects and other renewable
energy. In 2008 the investment was NPR 106,600,000 which took the pace in the year
0
20000000
40000000
60000000
80000000
100000000
120000000
Proposed Dividend

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2010 with the total investment sum of NPR 653,188,037 which further increased to NPR
701,661,742 and in 2012 it has decreased to NPR 635,701,689.
Figure 7: Investment
1.10.6 Loans, Advances & Bills Purchased
Loan is one of the most crucial interest sensitive assets of the banks and financial
institution. More than 50 percent of the asset value is covered by the loans sections, so is
the case of CEDB. Amount of loans, advances and bills purchase was NPR
1,480,068,757 in the 2008, which further increased to NPR 2,356,423,996 in 2009. The
growth of the amount of loans advances and bills purchase did not stop here it has grown
to NPR 4,538,376,213 in the year 2012.
Figure 8: Loans, Advances & Bills Purchased
0
200,000,000
400,000,000
600,000,000
800,000,000
Investments
0
1,000,000,000
2,000,000,000
3,000,000,000
4,000,000,000
5,000,000,000
Loans, Advances & Bills Purchased

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1.10.7 Fixed Assets
Fixed assets, also known as "tangible assets” or property, plant, and equipment (PP&E),
is a term used in accounting for assets and property that cannot easily be converted into
cash. This can be compared with current assets such as cash or bank accounts, which are
described as liquid assets. In most cases, only tangible assets are referred to as fixed.
International Accounting Standard (IAS) 16, defines Fixed Assets as assets whose future
economic benefit is probable to flow into the entity, whose cost can be measured reliably.
Figure 9: Fixed Assets
The fixed long term asset of the CEDB in the year 2008 was NPR 26,518,793 which has
increased to NPR 55,483,420 in 2009. For the next two (i.e. 2010 and 2011) there was
very little growth in the fixed asset but in the year 2012 the fixed assets of the bank has
gone up to NPR 166,200,571. Comparing this growth with return the increased in fixed
assets has led to decrease in the return of the bank, this means to say that the fixed assets
have not been utilized in the productive area.
1.11 Organization Performance
Financial performance of any organization shows the financial strength and transaction
occurred during the specified period. Some of the key financial indicators are described
below.
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
160,000,000
180,000,000
Fixed Assets

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Table 2: Key Indicators of CEDBL
Particulars 2007/08 2008/09 2009/10 2010/11 2011/12
Net Profit 8,823,829 20,876,402 44,632,714 119,940,050 126,047,673
Earnings Per Share 3.94 6.52 13.95 10.22 10.74
Market Value Per Share - 846 588 167 145
Price Earnings Ratio - 129.68 42.16 16.33 13.5
Cash Dividend on Share Capital - - 13.5 5.6 10
Interest Income/Loan
&Advances
7.54 9.87 11.34 15.58 15.31
Total Credit/ Deposit 81.48 79.99 81.44 93.2 75.21
ROA 0.43 0.61 0.89 1.81 1.7
Total Staffs 40 93 117 131 135
Net profit of the CEDB is in increasing trend. In 2008 the banks net profit was NPR
8,823,829 which has further increased to NPR of 20,876,402 in 2009. In the year 2010
the banks was again able to capitalized the market and was able to generate the net profit
of NPR 44,632,714, with this amount of profit CEDB first distributed the dividend to
their shareholders.
Figure 10: Net Profit
In 2011 CEDB had the net profit of NPR 119,940,050 which increased to NPR
126,047,673 in 2012.Earnings per Share has been increased till 2009 and slightly
decreased in the next year which made little increase in the year 2012. The Market Value
0
20000000
40000000
60000000
80000000
100000000
120000000
140000000
Net Profit

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per Share has not performed well it is in decreasing trend. In 2008 MPS was Rs.864
which was found to be Rs.145 in the year 2012.
There is increase in interest income from 2008 to 2011 but in the year 2012 there has
been slightly decrease in the interest income from the loans and advances. Looking at the
CD Ratio CEDB has utilized 81.48 percent of its deposit liabilities into earning assets in
2008, in 2009 it was 79.99 percent. Next year it was increased to 81.44 percent. In 2011
CEDB has turned 93.2 percent of its liability into earning assets, which has further
decreased to 75.21 percent.
Figure 11: Return on Assets
From the above figure we can see that the ROA is in increasing trend up to 2011, but in
2012 it has decreased to 1.7 percent from 1.81 percent. From this analysis we can say that
the firm in not able to utilize its fixed assets in productive sectors.
In terms of number of staff every year there has been the recruitment in 2008 there was
only 40 staff and coming till 2012 the banks has 135 staff.
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
2
ROA

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CHAPTER: II
JOB PROFILE AND ACTIVITIES PERFORMED
2.1 Introduction to Credit Department
Credit Department is significant part of every financial institution. It is the section from
where banks earning assets are created and assortment is made to the potential clients and
in the future collection of the credit is made. Credit Department is always focused on
maximizing loan portfolio, accelerating cash inflow, minimizing bad debt losses,
reviewing and approving new accounts, developing and updating credit and collection
policies, establishing appropriate credit limits and terms of sale for new and active
customers, creating new or more appropriate payment terms (terms of sale), Placing
accounts on credit hold, and releasing orders from credit hold, Managing the collection
function, Maintaining current information in the credit file on each active customer,
Documenting credit decisions and actions, Performing financial analysis on customer
financial statements, Researching and resolving disputes and deductions that would
otherwise delay or prevent payment of accounts receivable, Management reporting, and
safeguarding the company's investment in accounts receivable.
2.2 Credit Service Provided by CEDB
CEDB has been providing wide range of credit package to the potential Customers. It has
crowded its credit facility under two segments. First Segment include Personal Loan
which includes; Overdraft, Vehicle Loan, Home Loan, Foreign Employment Loan,
Demand Loan, Margin Loan, Clean Academic Loan, Other Loan.
Second Segment include the business loan that consist of providing financial assistant in
various form like Business Overdraft, Short Term Working Capital Loan, Term Loan,
Hire Purchase Loan, Demand Loan, Real Estate Loan, Women Entrepreneur Loan,
Young Entrepreneur Loan, Clean Contractor Loan, Margin Loan, Consortium Loan and
Other Loans
2.2.1 Personal Loan
Personal loan are those loans which are given to the individual for the personal finance.

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Different Personal Loans Provided by CEDB are discussed below.
2.2.1.1 Overdraft Loan
Overdraft loan is provided by the bank to meet the unexpected payment and insufficient
fund at emergencies up to the approved limit.
Table 3: Interest Rate on Personal OD Loan
Types of Loans & Advances Prime (% p.a.) General (% p.a.)
Overdraft 12 15
2.2.1.2 Vehicle Loan
CEDB provides the vehicle Loan for the individual to purchase or upgrading the vehicle
for the personal use at the nominal interest rate.
Table 4: Interest Rate on Personal Vehicle Loan
Vehicle Loan 12 14
2.2.1.3 Home Loan
Every individual holds the dream to have their own sweet home. CEDB has been the final
destination for those dreams to make it come true. CEDBL provides the loan to the
potential customer to build the home.
Table 5: Interest Rate on Personal Home Loan
Home Loan (HL) 11.5 14.5
2.2.1.4 Foreign Employment Loan
This loan is used for the family member of the client to go abroad for foreign
employment. Bank offers this loan to those clients who have utilized General loan with
good repayment performance.
Table 6: Interest Rate on Foreign Employment Loan
Foreign Employment Loan 12 15.5

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2.2.1.5 Demand Loan
This loan is provided by the bank to its long standing customers. These are short term
loans that offer the customers an advantage of open ended schedules for repayment. This
can be especially important if the purpose of the loan is to fund a new venture that may
take some time to become profitable.
Table 7: Interest Rate on Personal Demand Loan
Demand Loan 12 15
2.2.1.6 Margin Loan
CEDB’s Margin Loan is flexible investment loan that can be used for expanding the
personal ventures. For this loan the customers simply needs to provide existing approved
shares, bonds or cash as security for the loan and then use the borrowed money to
augment the investment portfolio much faster giving the ability to increase the potential
returns.
Table 8: Interest Rate on Margin Loan
Loan against Government Bonds 11 13
Loan against Fixed Deposit of CEDBL (self) ( +2.00% )
Loan against Shares 13 15.5
2.2.1.7 Clean Academic Loan
CEDB provides the financial support for the higher studies to the student to pursue
graduate or a post-graduate degree. CEDB the Education Loan seeks to provide a peace
of mind by offering the opportunity to pursue education on affordable terms and
conditions.
Table 9: Interest Rate on Education Loan
Education Loan 10 15

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2.2.1.8 Other Loan
CEDB also provides other personal loans which are in Terminating or Revolving Nature.
Table 10: Interest Rate on Other Loans
Other Loan 14 16
Personal Loan - Terminating 13.5 15.5
Personal Loan - Revolving 14 15.5
2.2.2 Business Loan
Business loan is a debt-based funding arrangement that a business can set up with a
financial institution. The proceeds of commercial loans may be used to fund large capital
expenditures and/or operations that a business may otherwise be unable to afford.
Different Business Loans Provided by CEDB are:
2.2.2.1 Business Overdraft
The CEDB business overdraft provides the business person with the freedom of multiple
purpose business finance and transactional banking, taking permanent care of the
working capital needs for the business. This facility will ensure that to have funds readily
available to assist the business when the need arises.
Table 11: Interest Rate on Business Overdraft
Overdraft (O/D) 12 15
2.2.2.2 Short Term Working Capital Loan
CEDB offers short term working capital solutions that can help the business firm to
manage the cash flow with greater ease. This revolving line of credit is designed to
provide with extra cash to cover seasonal or unexpected expenses, plus flexible
repayment options to suit.
Table 12: Interest Rate on Short Term Working Capital Loan
Short Term / WC Loan (WCL) 12 15

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2.2.2.3 Term Loan
CEDB provides the financial assistance to the business firm for the procurement of fixed
assets such as land, building and equipment. With CEDBL Term Loan the business firm
can preserve the working capital and assist in the capital expenditure for the growth of
the organization.
Table 13: Interest Rate on Term Loan
Term loan (TL) 12.5 15
2.2.2.4 Hire Purchase Loan
CEDB offers the convenient and affordable hire purchase loan for the business firm to
purchase the vehicles for their business purposes. The ownership is automatically
transferred to the business firm after the final payment.
Table 14: Interest Rate on Hire Purchase Loan
EV Transport Loan 13 15
Hire Purchase - Commercial 13 15.5
2.2.2.5 Demand Loan
Designed for changing needs, the CEDB Demand Loan is a revolving line of credit that
offers flexibility, value and control. This loan is especially suited for business expansion
or investment purposes while allowing the business firm an easy access to funds up to the
approved limit whenever it suits the best. These loans are Short term in nature.
Table 15: Interest Rate on Demand Loan
Demand Loan (DL) 12 15
2.2.2.6 Real Estate Loan
CEDB offers a noteworthy solution for financing real estate development such as
housing/apartment projects, commercial properties and land plotting projects. The

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product offering involves discounting the future receivables every month and providing
an upfront loan, thus extending good liquidity in the business.
Table 16: Interest Rate on Real Estate Loan
Real Estate Loan 14 15.5
2.2.2.7 Women Entrepreneur Loan
This easy processing loan is for independent women entrepreneurs with potential to
become change in the society. The credit facility can be used for trade financing, working
capital management, fixed asset purchase, tender bid/performing contractual
activities/advance payment, etc. CEDB has been providing this loan at prime rate.
2.2.2.8 Young Entrepreneur Loan
CEDB provides the young entrepreneurs loan for young high growth entrepreneurs who
are integral to economic dynamism. As CEDB believes in fair access to affordable capital
for people to improve their own lives, this provided credit facility includes trade
financing, working capital management, fixed asset purchase, tender bid/performing
contractual activities/advance payment, etc. CEDB has been providing this loan at prime
rate.
2.2.2.9 Clean Contractor Loan
This one of an easy loan processing is for contractors or construction engaged in
hydropower sector or infrastructure projects. This credit facility includes structured
financing facilities. CEDB has been providing this loan at prime rate.
2.2.2.10Margin Loan
The CEDB Margin loans are investment approach that may potentially help to maximize
the returns from your portfolio.
Loan against Government Bonds 11 13
Loan against Fixed Deposit of CEDBL (self) ( +2% )
Loan against Shares 13 15.5
It uses one of the oldest financial techniques to enhance your returns – Gearing. Gearing
means that the firm borrows money to invest whilst using the firm’s own cash, bonds or

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shares as collateral. The idea is that business firm can increase the portfolio and thereby
increase the potential for profit over time.
2.2.2.11Consortium Loan
A consortium financing solution usually entails several banks or financial institutions
joining hands to finance high value/ large projects by a single borrower through a
common appraisal, common documentation and joint supervision. Similarly, a CEDB
consortium financing solutions involve offering advisory and larger investment services
together with CEDB long-standing partner banks within the framework of a consortium.
2.2.2.12Other Loans
Loans that might not fit into a specific category fall under this category.
Figure 12: Interest Rate on Other Business Loans
Other Loan 14 16
2.3 Credit Flow Process
There is certain process how the loan is sanctioned to the customer. At first the customer
request for the new credit limit, the customers may be either new or existing. After this
the bank makes the screening to the request of the customer if the request of the customer
is not viable the bank advice to the customers. If the screening is viable then bank process
the credit application, after which the bank obtain the approvals from appropriate CAD
holders, if the CAD holders does not approve the loan it is further advised to the
customers. If the CAD holders approve the application further loan processing is taken
into action. When the customer is eligible for the credit facility the bank prepare the
Security Documentation from the respective unit as designed. Credit Process Flow is
shown Annex.
2.4 Activities Performed in the Organization
During the eight weeks of internship program, the intern has done different activities in
the credit department at Clean Energy Development Bank Limited, Durbar Marg Brach
under the supervision of the supervisor. Some of the activities performed by the internee
at the organization are.

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Checking Credit File
During the first one week, intern was assigned to check the credit file in order to find out
whether there are the required and appropriate documents presented by the loan applicant
or not. Generally, some of the basic things should be considered while performing such
kinds of activity. Firstly, the amount of the loan should be clearly known. It should be
clearly known how much amount of loan the customer is seeking for.
Secondly, while performing the activity of checking credit file, securities or collateral
related documents presented by the loan applicant should be carefully be checked out.
Value of the securities such as registered mortgage of land and building should be
evaluated. The market value is the value or price of the property in which it can be traded
and the distress value means the price of the property at the worst economic situation.
Intern had to check the distress value whether it is greater than the value of the property
or not. For the granting of loan, the distress value should be higher than the value of loan
amount.
The details of the land and building kept as the collateral should also be evaluated. Those
details may include the location if the land, ward no, plot no. and area of the land. These
are the basic details required to be known. It also should be checked whether the
insurance of the collateral like building, vehicle etc. is done or not.
The personal guarantee of the loan applicant and other persons should be checked
whether it is obtained or not. It should also be checked whether there is the signature of
witness or not in the personal guarantee of the loan applicant.
The valuators of the property of the loan applicant and the main valuator of engineer
should also be known clearly.
Calling the Clients for Different Purpose
During the internship program, intern used to call the credit clients for different purpose
to inform them about the change in interest rate and to deposit the interest at time. Some
of the loan files were found to be incomplete and intern made the phone calls for the
client to complete the required documents. Making the calls to the clients generated both
the good experience and bad; it was more complicated to make calls to inform about the

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rise in interest rates since the information make some clients sad and some clients have a
very aggressive feedback .
Completing the Document files
During the internship in credit Department of CEDB intern used to check the credit files,
Interns task was to arrange the credit files systematically so that they can be available
easily whenever it is needed. Interns’ second task was to make a list of the people and
security document whose credit files are closed but they have not collected their
collateral document. Mostly the security documents were the shares of different
companies and documents of land and building.
Check the evaluation document and insurance document
Make a list of that evaluation credit document which has expired and going to be expired
very soon. Every evaluation document is expired after the two years. Checking the
insurance documents and making the list of documents those are expired and going to be
expired very soon and making calls to the clients to renew their insurance documents.
Cabinet filing of the credit files in numerical order
The credit files are needed to the credit managers and the auditors at any time so it was
necessary to keep the credit files in order in the credit cabinet so that they can be easily
available at the time they are required. So interns task managed the files in a numerical
order by numbering the files and making a list of files in the excel sheet so that they can
be easily available.
Updated insurance information
Updated insurance information relevant to the insured and the collateral which requires to
be insured for loan purpose: Policy no.; Effective Date; Expiry Date; Insured; Premium
Amount; Vehicle no. / Household no.
2.5 Problems Solved
During the period of internship intern was placed at credit department. In the process of
providing loan small mistakes can also led to huge problem for the bank. Some of the
general mistakes encountered by the customers are as; bringing only the copy of the
required documents without original, presenting the firms documents without stamp, not
being careful while giving the thumb print and singing the documents, try to operate the
account without fulfilling the complete requirement, use of different ink in same

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document, delay in renewal the loan and other document like insurance, firm registration
etc.
Intern had to deal with various kinds of problems. Almost all problems, which could be
solved by the intern, were solved with the support and proper guidance by the bank’s
staffs. Some of the problems that were solved by intern are; reviewing the documents as
per the nature of the loan, finding of the missing documents and files, filling the
documents which were missed by client, posting the new interest rate and communicating
the new interest rate to client, alerting client the maturity date of loan and asking them to
pay the interest amount.
2.6 Intern's Key Observation
CEDB has a very organized structure of work flow design and adequate number of
employees to effectively and smoothly continue its operation. CEDB employees were
very cordial and supportive .They believed in intern’s abilities and demonstrated their
confidence by letting intern do some of very sensitive and important works. The interest
rate offered by the bank is updated as per the country’s economic scenario and it
frequently keeps on changing to match it with the economy.
The main drawback during internship period was that intern didn’t have the opportunity
to rotate through various departments. Intern spent whole of internship period in credit
department only. This meant intern could not gain any practical and real life knowledge
about the activities of other department of bank. But this wasn’t totally a bad thing
because it allowed intern to gain a more in depth knowledge on the activities of CEDB.
Actually this is much better than gaining superficial knowledge on various departments.

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CHAPTER: III
LESSONS LEARNT AND FEEDBACK
3.1 Key Skill and Attitudes Learnt
Everybody gradually acquires knowledge from various sources through the passage of
time. One of the major sources is the educational institutions internship enrolls.
Everybody tries to use such opportunity to acquire knowledge in every possible context.
During the two months of internship program intern has identified the application of
theoretical concept into the real working environment. In the internship program, intern
was exposed to various transaction and activities conducted at CEDB. Intern learnt
different skills and obtained a variety of knowledge during the internship in the banks
that are:
1. From the Internship the communication skill has been enhanced. It has helped to
cope with different people who come from different background.
2. It helps to enhance the ability to operate within business organizations through social
communication and interactions.
3. Help to cope with the real work situation and handle a number of problems.
4. Helped to develop the ability to work under pressure.
5. Developed the confidence, self-belief and determined in every task.
6. Learnt general banking transaction.
7. How to process loan to the customers.
8. To check and verify loan documents manually and how it is filed in credit and vault
file.
Other important lesson learnt was; in an organization, there should be a friendly
environment that makes working place even better and enjoyable giving all the members
an opportunity to know each other and share ideas and knowledge they might have
despite a hierarchy. The degree of socialized environment of any organization determines
the effectiveness and efficiency of any organization. So, it is the case in CEDB. The
friendly environment, good organizational culture and efficient management are the

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various reasons behind the success of this bank despite the heavy work load that all the
organization have for sure.
3.2 Feedback to the Organization
The banks are of foremost importance to a country because of their role as a strong pillar
for the economic development of a nation. With the wave of the globalization and the
advancement in technologies, without the strong base of the banking platform, the
economic development of the nation would be paralyzed. Thus, it would be very
legitimate to say that the development banks are of much importance to a developing
country like Nepal and CEDB being the highest ranked development banks of Nepal, has
undoubtedly fill the gap to a great extent. Basically, banks are proliferating, cutthroat
competition is prevailing plus there is unhealthy competition. So, in this competitive
scenario, CEDBL is retaining and maintaining its strength and proving itself as a
benchmark in the Nepalese banking industry.
This report is based on the internship that is required in partial fulfillment of MBA and
the internship was done at the CEDB. The report basically focuses on the Credit
department. Basically, the activities performed and problems solved are discussed in the
report. The activities performed has developed the communication and different other
interpersonal skills of the intern. Besides, it has also made the intern to be able to work in
groups. The report is based more on self-observation and in this; the information is
acquired through the formal and informal discussions with the bank staffs. However, due
to brevity, the banking activities cannot be understood in detail.
There is no second thought that the funds to be managed in the organization or any
financial institutions has been the stepping stone to move ahead, yet the journey does not
end at this point. To maintain its strength and significance, the product and its services
has to be extensively advertised along with the spark of innovation in every sphere of
banking activities that will help to attain the position of landmark in the Nepalese
banking sector, maintain its present market share and brand image in the eyes of array of
customers.

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True enough, the internship program has proved to be not just a matter, rather an
opportunity to get the practical working experience in the real business scenario. It has
not just helped to apply the theoretical knowledge gained so far in practical application
but also played a major role to keep patience, fostering the ability to work in pressure.
Being an intern at CEDBL, it has fostered the degree of passion, punctuality and taught to
work in actual organization setting as its part. Dealing with the numerous customers with
the varied expectation, handling their complaints at the spur of moments without losing
temper etc. will undoubtedly help the intern to benefit from the internship program in the
long run of their professional career. From the overall analysis and work at the CEDB for
the internship period some of the recommendations for the organizations are:
1. Customers are the first priority so they should be given more attention. So complains
of the customers should be promptly responded.
2. CEDB should be more market oriented; services oriented and offer a complete range
of financial as well as customer service for customer satisfaction.
3. The Bank should perform frequent market research to increase the customer
satisfaction level.
4. Technical problems regarding communication technologies must be examined and
maintained periodically so to provide efficient services to customers.
5. Frequent change in rate of interest should be informed to the customers on timely
basis.
6. The intern students should be placed in every departments so that they can learn the
working environment of each department rather than placing only on one department.
7. It is found that at times, bank focus much of its attention to one sector leaving other
sectors unfocused so it is recommended to touch all the sector and balance it
effectively so as to have the optimal performance of the bank.
8. The banks have only three ATM so the banks need to increase the number of ATM.
9. At the time of sanction and landing loan from CEDB, there are usually taken more
time and lengthy procedure so it is suggested that bank should improve its efficiency
job.
10. The department of banks should also pay attention to the interns and motivate them to
learn and develop banking skill so that they can contribute better during intern period

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and also in figure their obtained attitude and knowledge will be contributing to bring
awareness about banking, and after completion of study if they choose profession of
banking it will better off for their banking career perspective.
3.3Feedback to the College/University
This report is prepared for the partial fulfillment of MBA (Finance) under Pokhara
University, Uniglobe College New Baneswor, Kathmandu. During the Internship period
Internee experienced some of the loopholes which should be corrected to some of the
feedback provided by internee are:
1. College should invite the organization’s supervisor to make know about the
objective of internship that should be provided to intern.
2. It would have been fruitful for the student if there had been visit of the college
representative or supervisors at least once during the internship period.
3. It would be beneficial to assign the internship at the last trimester of the college
where students can obtain the real work environment more efficiently.
4. College should try to promote the strength of the student and the course they are
providing to the students so that the internee are assigned intern as per their
capability or strength.
5. Extending Internship period will be more efficient for students to learn more new
things.
6. The selection of organization should be mandatory and based on student own
interest rather than concentration on commercial bank only.it would have been
more fruitful if the students were provided freedom to choose the organization of
their interest.
7. Duration of internship program is too short for proper evaluation of the actual
abilities, qualities and attributes of related intern. This invariably results in the
erroneous evaluation of the intern. So, either duration of the internship program
should be increased or, attributes which cannot be judged within 8-12 weeks
period should be eliminated from the evaluation report.

CEDBL_Intern_Report

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