Human Resource Management
Training wing was upgraded to Training & Organization Development Group in November  2011 with the objectives of long term development of human resources and revitalizing of executive development center. As a first step to achieve our goal of long term development of human resources, a training calendar for the next three years ( 01 ,  013, &  014) has been developed on the basis of Training Need Analysis (TNA). During the year under review over 13,000 employees were trained. Overseas and outside trainers are being engaged and the bank in coordination with leading business schools of the country will conduct specialized workshops for further improvement of modern day banking concepts. Engineering and design consultants have been engaged along with project management consultants to start work on the construction of a World Class Training Center at Karachi with a view to meet the organizational objectives of giving top priority to the human resource development of the bank.
The bank has successfully implemented centralized payroll system for better management of issues related to staff remuneration and benefits.

Compliance
Compliance is an independent function that identifies, assesses, advises, monitors and reports on the bank's compliance risk, i.e. legal or regulatory sanctions, financial loss or reputation loss a bank may suffer as a result of its failure to comply with applicable laws and regulations.
The bank accelerated its efforts to strengthen compliance culture in the bank. Special emphasis has been placed on Anti Money Laundering (AML) and Know Your Customer (KYC) procedures have been further strengthened.

Credit & Risk Management
Credit and Risk Management has developed comprehensive credit policy & procedures documents which are regularly updated to improve credit related decisions and solutions. To adjust to the changes in the external environment the bank has "Economic Research Wing" for tracking, highlighting and interpreting the national and global events and economic indicators. Besides this "Industry Research Wing" performs SWOT analysis of various industrial sectors for better credit decisions. A separate project monitoring wing has been established to monitor the projects which are financed by the bank.
NBP, being the largest bank of the country is fully aware of its leading role in the sustainable economic growth of Pakistan. Keeping this in mind, we are fully committed to strengthen the risk management structure and practices in NBP. In this regard an Executive Risk Management Committee (ERMC) has been established, the risk management function has been made independent from credit approval and representation of risk management has been made mandatory in Asset Liability Committee (ALCO) & Credit Committee while discussing policies, product plans & portfolio reviews.
NBP has organized various orientation and discussion sessions during the year on risk management. Additionally, an Enterprise Risk Management training session, by a reputed external consultant, was arranged for creating awareness amongst the senior management across all disciplines.

Awards & Recognitions
In June  2011 M/s JCR-VIS Credit Rating Company re-affirmed the bank's stand-alone rating of "AAA", highest by the company for any bank in Pakistan. The bank was also awarded "World's Best emerging market bank from Asia in Pakistan for the year  2011" by the Global Finance Magazine in May  2011. NBP is also ranked as 'Top Bank from Pakistan in Top 1000 World Banks  2011' by The Banker Magazine in its July 2011 edition.

Corporate & Social Responsibility
NBP, being the largest bank, is fully aware of its social obligations and has integrated its social welfare and community development initiatives to achieve sustainable growth in social and economic sectors of Pakistan.
The bank is running a robust CSR program to benefit the community at large by investing in projects related to critical socio-economic developments such as social welfare, healthcare, education and sports. During the year 2011, NBP cricket team won the T- 0 corporate cup besides the hockey team winning National Hockey Championship. The bank belives that education is the back bone for development of any nation and took various initiatives for uplifting the educational activities and opening of a library in Layari was a step in this direction.
Rehabilitation work of flood affected degree college at Khairpur Nathan Shah and  5 schools located in D. G. Khan, Nowshera and Usta Mohammad was undertaken. Numerous free medical & eye camps in various parts of the country were also organized.
The bank in association with Social Welfare Department, Government of Sindh conducted one month vocational training of stitching & embroidery for the women of flood affected areas and after completion of training, sewing machines were distributed.
We are focusing on increasing our presence through outdoor advertisements and are promoting our corporate image, products and services through number of print and electronic campaigns. Aggressive advertising campaigns and product branding are on the cards for 01 .

Future Outlook
Going forward the bank will focus on reduction in NPLs and increasing CASA deposits. NBP has undertaken a number of initiatives in the area of I.T. upgradation which include core banking implementation, completion of conversion of remaining branches on online network, ATM expansion, and mobile & internet bank facilities. The bank has formulated quantitative customer service standards for further improvement in our customer services. The bank will continue to invest in HR capacity building through training, workshops and seminars. The bank will further expand its international franchise by opening branches in Dushanbe, Tajikistan and Colombo, Sri lanka. The bank will leverage its rural branch coverage to increase share of rural deposits.
NBP has four dedicated corporate branches in Karachi, Faisalabad, Islamabad and Multan serving high valued clients and in 01 we intend to open a corporate branch in Lahore as well. Trade finance and remittances will remain our focus. Efforts will be made to improve expense management and achieve greater operational efficiency.

.

Qamar Hussain
President
Date: March 06, 2012