GLOSSARY

[A] Agreement Corporation: Corporation charted by a state bank to engage in international banking; so named because the corporation enters into an agreement with board of governors to limit its activities to those permitted an Edge Act corporation. Automated teller machine-ATM: Computer-controlled terminals located on the premises of financial institutions or elsewhere, through which customers may make deposits, withdrawals, or other transaction as they would through a bank teller. [B] Bill: A short term obligation of US treasury (13, 26,0r 52 weeks maturity). Bonds: a long term obligation of US treasury (more than ten years maturity) [C] Central Bank: The principal monetary authority of nation, a central bank performs several key functions, including issuing currency and regulating the supply of credit in the economy. The SBP is the central bank of Pakistan. Cheque Clearing: The movement of chaeques from the bank or other depository institution where they are deposited back to those on which the y are written, and funds movement in the opposite direction. Collateral: Property that is offered to secure a loan or other credit and that becomes subject to seizure on default. (Also called security). Commercial Bank: A Bank that offers a broad range of deposit accounts, including checking savings and time deposits, and extends loans to individual and businesses. Commercial banks can be contrasted with investment banking firms, such as brokerage firms, which generally involved in arranging for the sale of corporate or municipal securities. Correspondent Bank: A Bank that accepts deposits of and performs banking services for other depository institutions. Credit: The promise to pay in future in order to buy or borrow in the present. The right to defer payment of debit. Credit Card: Any card, plate, or coupon book that may be used repeatedly to borrow money or buy goods and services on credit. Credit Worthiness: A creditors measure of a consumers past and future ability and willingness to repay debits.

Current Account Balance: The difference between the nations total exports of goods, services and transfers and the total imports of them. Current accounts balance calculation exclude transaction in financial assets and d liabilities. [D] Debit Card: A card that resembles credit a credit card but which debits a transaction account (checking amount) with the transfers occurring contemporaneously with the customers purchase. Discount Rate: Interest rate at which an eligible depository institution may borrow funds, typically for a short-term period, directly from a Federal Reserve Bank. [E] Electronic Funds Transfer - EFT: Transfer of funds electronically rather than by cheque or cash. The Federal Reserves fed wire and automated clearinghouse services are EFT system. Electronic Fund Transfer Systems EFTS: A variety of system and technologies for transferring funds (money) electronically rather than Cheque. This includes fed wire, automated clearinghouses (ACHs) and other automated system. Exchange Rate: The price of a countrys currency in terms of an other countrys currency. [F] Financial Institution: An institution that uses its funds chiefly to purchase financial assets (loan, securities) as opposed to tangible property. Financial institutions can be classified according to the nature of he claims they issue. Financial Instrument: Any written instrument having monetary value or evidencing a monetary transaction. Fixed Change Rate System: Exchange rates between currencies that are set at predetermined level and dont move in response in supply and demand. [L] Liquidity: (1) The ability of a bank or business to meet its current obligations; (2) the quality that makes an asset quickly and readily convertible into cash. [M] Money Supply: The amount of money (coins, paper currency, and checking accounts) that is in circulation in the economy. Nominal Interest Rates: Current stated rates of interest paid or earned. Note: A medium-term obligation of the U.S treasury; 2-10 years maturity. See also bill and bond. [O] Open- End Credit: A line of credit that may be used repeatedly up to certain limit. (also called a charge account or revolving credit).

[P] Payments System: Collective term for mechanism (both paper-back and electronic) for moving funds, payments, and money among financial institutions through the nation. The Federal Reserve plays a major role in the nations payment system through distribution of currency and coin, processing of cheques, electronic transfer of funds, and the operation of automated clearinghouses that transfer funds electronically among depository institutions various private organizations also perform payments system functions. Premium: The amount by which the auction price of a bill, note; or a bond is higher than its face value. Principal Payments: The face amount of par value of a debt instrument where interest is paid. The interest payment is not part of the principal. [R] Real interest Rate: Interest rat adjusted fro the expected erosion of purchasing power resulting from inflation. Recession: A significant that in general economic activity extending over a period of time. Reserve: A depository institutions vault cash, (up to the level of its required reserves) plus balances in its reserve account (not including funds applied to its required clearing balance). [S] Saving Bank: Depository institution historically engaged primarily in accepting customers savings deposits and in originating and investing in securities and residential mortgage loans; now may offer checking type deposits and make a wider range of loans. Securities: Paper certificate (definitive securities) or electronic records (bookentry securities) evidencing ownership of equity (stocks) or debit obligation (bonds). Surcharge: An extra charge imposed on those who purchase with a credit instead of cash. (Currently, surcharges for credit card purchases prohibited). [U] Utility: Utility theory explains customer tastes and preferences. [X] X-Mark Signature: A signature made by a person unable to sign his or her name. To
be legal valid, the signature must be witnessed by another person.

BIBLIOGRAPHY
www.nbp.com.pk

Mr. Ghulam Abbas HR Manager Mr. Muhammad Nawaz Cheema Mr. Shehzad Customer Facilitation Officer (CFO) Mr. Asghar Kamboh Clearing Incharge Mr. Ghulam Mustafa Bills Incharge Mr. Ajaz bhatti (Credit Officer) Miss. Sayeda Ruqia Ansar (Credit Officer)