Report on Letter of Credit

Topics: Bank, Financial services, Trade finance Pages: 37 (11557 words) Published: October 29, 2011



It has been a really awesome experience to be an intern at Everest bank limited. During the internship, I got an opportunity to meet the top personality of the banking sector and I got to know the real working environment and procedures of the banking industry. This report is based on Issuance of Letter of credit at one of the leading bank of Nepal, Everest Bank Limited. It is prepared as a part of the internship program in partial fulfillment of the course-Bachelor of Business Administration (BBA) 8th semester. During the preparation of this report, many people have helped me either directly or indirectly. So this report is an outcome of the valuable suggestions and guidance of different peoples and also help of senior’s report along with our report supervisor. In regard to this it is an inevitable duty of mine to acknowledge these persons gratefully.


Everest Bank Limited is one of the commercial banks in Nepal, which was established in joint venture with Punjab National bank of India. It has been serving its customer since . Everest bank has contributed a lot in the development of the country. Being a member of SWIFT, this facilitates towards its valued customers. So, Everest bank plays a developing role not only in urban areas but also in rural areas. This shows that the bank has keen interest in the overall development of the country. It has provided loan for the agriculture, cottage, and small scale industry, large industries and many more. In other words, we can say that it has played a great role in the development of our country. Everest Bank has played a great role in the development of the international trade. From the letter of credit transaction of Everest Bank Limited, we can say that it has really helped the international trade, which also helps to uplift the national economy. The terms and procedures used in the Letter of credit may vary from country to country and also from one bank to another bank. It is necessary to follow specific guidelines so that consistency can be achieved. So, It is advised that banks in Nepal should follow the NRB directives and ICC guidelines before opening L/C. The report attempts to examine and evaluate the financial overview of Everest Bank Ltd. with main references to Letter of Credit. Further, it attempts deep evaluation for the role of L/C in total contingent liabilities. The financial statement of Five years of the bank has been Processed and analyzed comparatively for the purpose of the study. Individual interview with the management has been taken wherever necessary. The study is exploratory as well as analytical to some extent.


NRBNepal Rastra Bank
L/CLetter of Credit
ICCInternational Chamber of Commerce
SWIFTSociety for Worldwide Interbank Financial Telecommunication UCPDCUniform Customs and Practice for Documentary Credits IFICInternational Finance Investment and Commerce
ATMAutomated Teller Machine
SMSShort Messaging Service
ABBSAny Branch Banking Systems


1.1 Background of the study:
Financial services are the backbone of the modern economy. All branches of economic activity today are fundamentally dependent on access to financial services. So it is the key sector that underpins global economic growth and plays a major role in the development of infrastructure for trading goods and services. Thus growth of this sector is also booming than other sector of the economy.

Same is the case of Nepalese financial service sector. After the adoption of economic liberalization policy by Nepal Government, which was started some two decades age, Nepalese financial sector has been benefiting more than that of other sectors of the economy. The growth of the bank and financial institution is growing investment of diverse economy.

Even though...
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