A Graduate Research Report Submitted to
Ace Institute of Management
Pokhara University

Submitted for the degree of
Master of Business Administration

Kathmandu
Monday, March 28, 2011

Table of Content
1. INTRODUCTION 1.1 Background 1.2 Problem Statement 1.3 Objectives of the Study
2. THEORITICAL FRAMEWORK 2.1 Research Question 2.2 Research Hypothesis
3. METHODOLOGY AND SAMPLING DESIGN 3.1 Types of Research 3.2 Sources of Data 3.3 Questionnaire Design 3.4 Sampling Design
4. DATA MANAGEMENT AND ANALYSIS

CHAPTER 1
INTRODUCTION
1.1 Background
Nepal Bank Limited is the oldest commercial bank of Nepal. It was established 1937 which marked the beginning of an era of formal banking in Nepal. From the very conception and its creation, Nepal Bank Ltd, was as joint venture between the government and the private sector. Out of 2500 equity shares of NRs. 100 face value, 40% was subscribed by the government and the balanced i.e. 60% was offered for the sale to private sector. There were only 10 shareholders when the bank first started.
It can be said that Nepal Bank Limited has a history that is unequal to any in Nepal. It was the first one of its kind. It also served as the central bank of Nepal. It is, thus, safe to say that the history of banking sector in Nepal would be incomplete without mentioning Nepal Bank Limited. The service rendered by Nepal Bank to the country and its people is a great one- one that has no parallel.
The banking industry is highly competitive, with banks not only competing among each other; but also with non-banks and other financial institutions. Most bank product developments are easy to duplicate and when banks provide nearly identical services, they can only distinguish themselves on the basis of price and quality service. Therefore, customer retention is potentially an effective tool that banks can use to