Metropolitan University

School of Business

Department of Business Administration

Internship Report

Title: General Banking in Bangladesh: A Case Study

BY

TANZIDA KHAN

BBA 12th Batch

ID number: 072-116-005

UNDER SUPERVISION OF

Mr. Md. Abul Kalam ChowdhuryProfessor and DeanSchool of Business

Date of submission: 19th of July, 2011

Student declaration

I confirm that the contents of this report are entirely my own work and that nothing has been included

from other sources without acknowledgement/reference. I also confirm that I did not become

demoralised during the preparation of this report. Even I want to assure you the fact that the report

wouldn't be found anywhere else. This report has not presented anywhere fully or partially for the

purpose of publishing.

Tanzida KhanID number: 072-116-005BBA 12th BatchDepartment of Business AdministrationSchool of BusinessMetropolitan UniversitySylhet, Bangladesh

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Letter of Transmittal

July 19, 2011

To,Mr. Md. Abul Kalam ChowdhuryProfessor and DeanSchool of BusinessMetropolitan University, Sylhet

Subject: Submission of internship report

Dear Sir,

May peace be on you. It is of immense pleasure to submit my internship report on “General Banking in Bangladesh: A Case Study” taking EXIM Bank as a sample. The project was assigned to me as a partial fulfilment of my BBA graduation requisite. It was an invaluable experience of teamwork and management while working as an “Intern” banker in EXIM Bank, Sylhet Branch.

The main objective of the internship and the consequent report is to gain a deep insight of the general banking system of EXIM Bank, Sylhet Branch. I tried my level best to explore the deepest minute of the general banking process. My quest will be reflected in the report as I tried to put everything that I have learnt in this report.

I am grateful to you for providing me with this unique experience of real world banking system. It was a big chance for me to apply all that I have learnt in the course of four years during my BBA program at Metropolitan University. While preparing the report, I tried to adhere to your “Guidelines for Internship Report” with minor necessary alterations. I have tried my best to make the report self explanatory, but if you require further information please don’t hesitate to contact me.

Yours sincerely

Tanzida KhanID number: 072-116-005BBA 12th BatchDepartment of Business AdministrationSchool of BusinessMetropolitan UniversitySylhet, Bangladesh

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Preface

Modern Banking is a result of evolutions driven by changing economic activities and lifestyles.

Entering a new millennium, banking needs have become more diverse and exotic than ever before.

After our independence from Pakistan, apart from the foreign Banks all the commercial Banks were

nationalized. In 1983, the government of Bangladesh gave permission to establish private Banks in this

country. After this regulation most of these nationalized commercial Banks were shifted into the

private sector. Many private Banks were established in this country.

The report at hand is the outcome of an in-depth study of the general banking system of Bangladesh,

taking EXIM Bank as an example. The project is a requirement for the partial fulfilment of BBA

graduation program ay Metropolitan University, Sylhet, Bangladesh. The internship period ran from

the 25th of January 2011 to 25th of April 2011. During this period, I joined EXIM Bank, Sylhet Branch

as a full time intern. I completed the internship under the supervision of the skilful and experienced

staff of the bank and my efficient teachers at the University. During this time, I observed the different

complex and detailed processes that a bank has to undergo to run its day to day duty as a banking

service provider. This report is a descriptive one, which was administered by collecting primary and

secondary data. Descriptive Research has an important objective: gives description of something

marketing characteristics of function (Malhotra, 2001) and also the description of phenomenon or

characteristic associated with an object population (who, what, when, where and how of a topic,

Copper, 2001). The report tried to evaluate the performance of Export Import Bank of Bangladesh

Limited. Before going in to the deep study, conceptual structure is visualized under which the whole

study was conducted.

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Acknowledgement

Reports of this kind require effort from a lot of parties to be a success. My report is also not an exception. There are many individuals and groups who have contributed directly or indirectly in my internship and the final report.

Firstly, I would express my ultimate gratitude to Allaah, the Lord of all the creations. It is only because of His mercy that I could complete my studies, my internship and finally, my report. May Allaah make my path smoother in the future.

I am also grateful to my honourable supervisor Mr. Md. Abul Kalam Chowdhury , Professor and Dean, School of Business, Metropolitan University, Sylhet for his sincere guidance and advice throughout the preparation of this report.

I would also like to thank Md. Jashim Uddin, Senior Assistant Vice President and Manager, EXIM Bank, Sylhet Branch. It is him who made it easy for me to understand and encouraged me a lot during my internship program.

Last but not the least; I would like to thank the respected and efficient teaching staff of Metropolitan University and the staff of EXIM Bank, Sylhet Branch for their cordial help and assistance throughout my studies and internship. I received enormous amount of knowledge and experience from them.

“All praise is for Allaah” – Al Qur’aan, Surah Fatihah, Chapter 1, Verse 1

“Narrated Abu Hurayrah: The Prophet (peace be upon him) said: He who does not thank Allah does not thank people.” General Behaviour (Kitab Al-Adab), Dawud :: Book 41 : Hadith 4793

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Executive Summary

Banking- A pillar of economy- is guide by laws, rules, regulations and practices. The prime objective

of the banking industry as a whole is to collect deposits from public and to invest the same in the form

of loans and advances to businesses. In our country, like others, banking company acts 1991 remain

operative to control and monitor the function of banks in coordination with other laws. Since the

banking functions are commercial in nature, many laws from the negotiable instrument act to civil

procedure code are essential in the day-to-day operations of the banks.

It gives me immense pleasure that during internship period, as part of the BBA program, I had an op-

portunity to spend a period of three months with a reputable organization where I observed and learned

the practice and management of banking sector. I have expressed a keen interest in spending my in-

ternship with banking sector, because I have learned from various sources that for developing country

this sector plays a vital role, but our country has not given so much attention to this sector. Therefore, I

choose EXIM Bank, a new generation private commercial bank, which has various tools for observa-

tion. I am very lucky that this bank gave me opportunity to work as an intern. EXIM Bank has stepped

into the new millennium with vigor and new aspiration. EXIM Bank has a country wide branch net-

work thorough which they provide a comprehensive banking service to their customers, which in-

cludes wealthy individuals, corporate clients, and financial institutions. The EXIM Bank has started its

operation in August 3, 1999. Since then EXIM Bank has diversified its business concentration mainly

on corporate clients and business banking. A detail of study of the past and present status of EXIM

Bank with future outlook has been incorporated in this overview of EXIM Bank. EXIM Bank has put

in place pragmatic policies and business strategies to ensure continued growth and success as the Bank

moves towards new millennium. The Bank’s principle is to attain efficiency and excellence in

everything the bank does and above all the bank focus on the needs of its customers. Diversity in its

product and efficiency in delivering the services to customers will remain an important component of

their long-term business plans.

The bank has introduced various customer friendly products and services like different Deposit

Schemes, Lease Finance, Consumer Credit Scheme, and Small Loan Scheme to encourage savings and

to bring about qualitative changes in the lives of the people of our country.

The practical activities of different desks what I have done is outlined in this report. Various rules and

regulations, policies and procedures relating to different banking activities have also been enumerated

here.

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Contents Table

No Content Page

01 Chapter 1: Introduction 1002 1.1 Origin of the Report 1003 1.2 Background 1004 1.3 Objective of the study 1105 1.4 Methodology 1106 1.5 Scope of the Study 1207 1.6 Limitation of the Study 1208 1.7 Time Line of the Study 1209 Chapter 2: The Bank 1310 2.1 Background 1311 2.2 Features 1312 2.3 Objectives 1413 2.4 Mission 1414 2.5 Vision 1415 2.6 Social Commitment 1516 2.7 Key Statistics 1617 2.8 Strategies 1618 Chapter 3: Product Information of EXIM Bank 2119 3.1 Products 2120 3.2 Investment Department 2421 Chapter 4: General Banking 2622 4.1 Account Opening Section 2623 4.2 Deposit Section 3024 4.3 Cash Section 3125 4.4 Remittance Section 3126 4.5 Clearing Section 3227 4.6 Accounts Section 3628 Chapter 5: Findings 3729 Chapter 6: Recommendation and Conclusion 3930 6.1 Recommendations 3931 6.2 Conclusion 3932 Bibliography 40

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Chapter 1: IntroductionBanks are financial institutions and have to utilize their generated fund effectively by investing in different

sectors. Its team of dedicated professionals is committed to provide an unparalleled service by using the

latest technology to make Bankable proposals harvest maximum benefits for the customers, the

shareholders and the society at large. In order to ensure a satisfactory level of recovery rate from its

investing activities, Banks should have a sound customer service. Identifying the reliable and real clients in

providing cash, credit and advances is essential for banking business and application of an appropriate

customer services can help this respect. As customers are one of the most important considerations in the

personal Banking, they should be given a chance to exchange their views and ideas about the Bank’s

products and services. This study attempted to reveal the facts about the strengths and weakness, if any, of

the customer services of EXIM Bank Limited with a view to have an in-depth idea about the customer

services of the Banking business. As an integral part of the Internship of the BBA program, this study has

been completed and submitted for evolution. Credit division is the heart of the Banking system as is in

EXIM Bank Under credit division credit management is the lifeblood of managing risk in a customer

portfolio. Credit management is mainly concerned with the credit disbursement and recovery of loan. In

order to strengthen credit management and recovery position of the loans or advances by the Bank it has

been decided by the EXIM Bank to follow some techniques for credit appraisal. With the use of such

techniques the credit management of EXIM Bank has shown their efficiency

1.1 Origin of the Report

This report is originated as the course requirement of the topic “Performance Appraisal of Private

Bank in Bangladesh: A Case Study (Taking EXIM Bank as a sample)” of BBA Program conducted by

the school of Management and Business Administration, Metropolitan University, Sylhet, Bangladesh.

As the practical orientation is an integral part of the BBA degree requirement, I was sent to EXIM

Bank Ltd. (Sylhet Branch) to take the real life exposure of the activities of banking financial

institutions from January 15, 2007 to May 15, 2007. Assigned by the Internship Supervisor, this report

is prepared by the author and submitted to the Business Administration Department.

1.2 Background

The report at hand is the outcome of an in-depth study of the general banking system of Bangladesh,

taking EXIM Bank as an example. The project is a requirement for the partial fulfilment of BBA

graduation program ay Metropolitan University, Sylhet, Bangladesh. The internship period ran from

the 25th of January 2011 to 25th of April 2011. During this period, I joined EXIM Bank, Sylhet Branch

as a full time intern. I completed the internship under the supervision of the skilful and experienced

staff of the bank and my efficient teachers at the University. During this time, I observed the different

complex and detailed processes that a bank has to undergo to run its day to day duty as a banking

service provider.

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1.3 Objective of the study

The General objective of the study is to provide an overview of learning of the intern during the

internship program and fulfil the internship requirement. Beside the general objective, the report can

be categorized into main objective and specific objectives. The objectives behind this report are

mentioned below:

Main Objective:

The main objective of this study is to prepare an internship paper (which is a partial requirement of the

under graduation program) on the specified topic working within an organization implementing the

knowledge that have been gathered over the past few years at Metropolitan University, Sylhet,

Bangladesh.

Specific Objectives:

•••• The specific objectives of this report are as follows:

•••• To analyze the performance of Export Import Bank of Bangladesh Limited (EXIM Bank).

1.4 Methodology

This report is a descriptive one, which was administered by collecting primary and secondary data.

Descriptive Research has an important objective: gives description of something marketing

characteristics of function (Malhotra, 2001) and also the description of phenomenon or characteristic

associated with an object population (who, what, when, where and how of a topic, Copper, 2001).

The report tried to evaluate the performance of Export Import Bank of Bangladesh Limited. Before

going in to the deep study, conceptual structure visualized under which the whole study was

conducted. The methodology of this report is very different from conventional reports. I have

emphasized on the practical observation though this report has to need some primary and secondary

data. Nevertheless, eventually almost the entire report consists of my practical observation. While

preparing the report, I have taken information from the following sources.

Sources of Data

This study covered two types of data, which are:

• Primary data

• Secondary data

Primary Sources:

• Observation of banking activities.

• Overflowing Conversation with the in-charge of general banking department of EXIM Bank

Limited, Sylhet Branch.

• Working with my own experience while internship program.

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Secondary Sources:

• Daily diary (containing my activities of practical orientation in EXIM Bank Ltd) maintained by

me,

• Various publications on Bank,

• Website of Bangladesh Bank,

• Website of EXIM Bank Limited,

• Annual Report of the bank,

• Personal investigation with bankers,

• Different circulars issued by Head Office and Bangladesh Bank

Data Analysis Technique

Data analysis technique are required form various desk, fields, reports and journals

etc. Collected data are analyzed to draw the conclusion. All the data at shown in tabular and chart

form.

1.5 Scope of the Study

EXIM Bank Limited is one of the leading Banks in Bangladesh. Banking sector is a large and difficult

area. A bank has different products, different services and different customers. Different departments

of a bank perform different activities. However, the scope of present study was limited in a specific

area of EXIM Bank, Sylhet Branch. So this study says only about the activities of EXIM Bank, Sylhet

Branch. The report covers the organizational structure, background, functions and the performance of

the bank.

1.6 Limitation of the Study

The following limitations are apparent in the report

� It was very difficult to collect the information from various personnel for their job constraint.

� There were some difficulties in understanding some activities due to not being relevant to the

theoretical knowledge.

� Due to confidentiality the Bank’s policy restricts disclosing some data.

� The study of such a short course of time is not free from limitation. So time limitation is the

main point of limitation.

� The data relevant for the analysis report writing sometimes could not be collected due to ex-

cessive year-ending workload at the branch. During the month of April, there was excessive

year-ending workload, which sometimes acts as a barrier on the way of my effort.

� It is too difficult to comment and suggest based on only the annual report and information col-

lected from written documents.

1.7 Time Line of the Study

January 25, 2010-April 25, 2010 (in EXIM Bank, Sylhet Branch)

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Chapter 2: The Bank2.1 Background

EXIM Bank Limited was established in 1999 under the leadership of Late Mr. Shahjahan Kabir,

founder chairman who had a long dream of floating a commercial bank which would contribute to the

socio-economic development of our country. He had a long experience as a good banker. A group of

highly qualified and successful entrepreneurs joined their hands with the founder chairman to

materialize his dream. In deed, all of them proved themselves in their respective business as most

successful star with their endeavour, intelligence, hard working and talent entrepreneurship. Among

them, Mr. Nazrul Islam Mazumder became the honourable chairman after the demise of the

honourable founder chairman. This bank starts functioning from 3rd August, 1999 with Mr. Alamgir

Kabir, FCA as the advisor and Mr. Mohammad Lakiotullah as the Managing Director. Both of them

have long experience in the financial sector of our country. By their pragmatic decision and

management directives in the operational activities, this bank has earned a secured and distinctive

position in the banking industry in terms of performance, growth, and excellent management. The

authorized capital and paid up capital of the bank are Tk. 3500.00 million and Tk 2677.80 million

respectively.

EXIM Bank emerged as Islamic Bank on 1st July 2004. The Bank’s rules and procedures are based on

“Islamic Shareeah” of course; the Panthapath Branch was Islamic Branch from its opening. Recently

the EXIM Bank offered shares. Here per Lott was worth of 6,500Tk wherever a Lott consists of 50

shares. The bank has migrated all of its conventional banking operation into Shareeah based Islamic

banking since July/2004. It is a first private sector bank to open exchange house in UK, &

implemented of the world renowned Core Banking Software namely TEMENOS-T24.

2.2 Features

• Though EXIM Bank is engaged in conventional in Banking, is also considers inherent desire of re-

ligious Muslims; and has launched Islamic banking system and inaugurates two Islamic Banking

Branches in the year 2002 and one in 2003. The Islamic Banking Branch performs their activities

under the guidance and supervision of a body called “Shareeah Council’

• It is the pioneer in introducing and launching different customer friendly deposit schemes to tap the

saving of the people for channelling the same to the productive sector of the economy.

• For uplifting, the standing of living of the limited income grope of the population the Bank has in-

troduced Monthly saving scheme to encourage the common and fixed income grope of people.

• It committed to continuous research and development so as to keep pace with modern Banking.

• The operations of the Banking are computerized oriented to ensure prompt and efficient to the cus-

tomers.

• The Bank has introduced customer relations management system to assess.

• The bank has also decided to go for online facility for the customers in near future.

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2.3 Objectives

� To response interest free banking.

� To establish participatory banking in leau of banking on debtor creditor relationship.

� To contribute in achieving the ultimate goal of economic system at present time.

� To play a vital role in human development and employment and employment generation

� To established welfare oriented banking system

� To invest different modes permitted under Islamic Shareeah at present timely.

� To extend co-operation to the poor, the helpless and the low income group for there economic

uplift.

2.4 Mission

The bank has chalked out the following corporate objectives in order to ensure smooth achievement of

its goals.

• To be the most caring and customer friendly and service-oriented bank.

• To create a technology based most efficient banking environment for its customers.

• To ensure ethics and transparency at all levels.

• To ensure sustainable growth and establish full value to the honourable stakeholders.

• Above all, to add effective contribution to the national economy.

2.5 Vision

The grist of our vision is “Together Towards Tomorrow”. Export Import Bank of Bangladesh

Limited believes in togetherness with its customers, in its march on the road to growth and progress

with service. To achieve the desired goal, there will be pursuit of excellence at all stages with a climate

of continuous improvement because, in EXIM Bank, they believe, the line of excellence is never

ending. Bank’s strategic plans and networking will strengthen its completive edge over others in

rapidly changing competitive environment. Its personalized quality services to the customers with the

trend of constant improvement will be the cornerstone to achieve our operational success.

Eventually the bank also emphasizes on:

• Provide high quality financial services in export and import trade.

• Providing efficient customer service.

• Maintaining corporate and business ethics.

• Being the trusted repository of customers’ money and their financial adviser.

• Making its products superior and rewarding to the customers.

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• Display team spirit and professionalism.

• Sound capital base.

• Enhancement of shareholders wealth.

• Fulfilling its social commitments by expanding its charitable and humanitarian activities.

Corporate Culture

This Bank is one of the most disciplined Banks with a distinctive corporate culture. Here we believe in

shared understanding and shared sense making. Our people can see and understand events, activities,

objects and situation in distinctive way. They would alter their manners, etiquette and character

individually to suit the purpose of the Bank and the needs of the customer who are of paramount

importance to us. The people in the Bank see themselves as a tight knit family that believes in working

together for growth. The corporate culture we belong has not been imposed; it has rather been

achieved through our corporate conduct.

Achievements

It is a great pleasure that by the grace of Almighty Allah, we have migrated at a time all the branches

from its conventional banking operation into Shareeah based Islamic banking operation without any

trouble . Lot of uncertainties and adversities were there into this migration process. The officers and

executives of our bank motivated the valued customers by counselling and persuasion in light with the

spirit of Islam especially for the non- Muslim customers. Our IT division has done the excellent job of

converting and fitting the conventional business processes into the processes based on Shareeah. It has

been made possible by following a systematic procedure of migration under the leadership of

honourable Managing Director.

2.6 Social Commitment

The purpose of our banking business is obviously to earn profit. But the promoters and the equity

holders are aware of their commitment to the society to which they belong. A chunk of the profit is

kept aside and spent for socio economic development through trustee and in patronization of art,

culture and sports of the country. We want to make a substantive contribution to the society where we

operate, to the extent of our separable resources.

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2.7 Key Statistics

Headquarters

Industry

Type

Company Size

Common Job Titles

Median Age

Median Tenure

Address

Phone/ Fax

Website

: Dhaka, Bangladesh.

: Banking.

: Privately Held.

: 1,500 employees.

: Officer 71%.

: 28 years.

: 3.5 years.

: Printers Bldg., 5 Rajuk Avenue, Motijheel Commercial

Area,

Dhaka-1000, Bangladesh.

: 02 956 1604/02 955 6988.

: http://www.eximbankbd.com2.8 Strategies

Financial overview of the Bank

Export Import Bank of Bangladesh Limited as one of the leading private commercial banks has

achieved significant progress in the banking operations for more than 10 years. It has successfully

mobilized Tk. 73,835.46 as deposits and disbursed investment of Tk. 68,609.91 million up to 31

December 2009 through its 52 branches. The total income and Expenditure of the Bank were Tk.

10,383.62 million And Tk. 7,201.84 million respectively that led to an operating profit of Tk. 3,181.78

million with an annual growth rate of 26.34% higher than that of the previous year. The return on

assets (ROA) after tax was 2.19% for the year 2009.

Capital and Reverse Fund

The bank started its mission with an authorized Capital of Tk. 1,000 million paid-up capital of Tk.

222.00 million subscribed by the sponsors in the year 1999. Its authorized capital was raised to Tk.

3500.00 million in the year 2006. In the year 2009, its authorized capital was further raised to Tk.

10,000 million. As on 31 December 2009, its total capital and reserve stood at Tk. 6717.21 million that

comprised of paid-up capital of Tk. 3,373.96 million and other reserves of Tk. 3,343.25 million. The

bank has also made general provision on unclassified investment and off Balance sheet exposure of

Tk. 997.46 million up to 31 December 2009.

Deposits

Deposit is the prime source of fund invested to earn revenue in the banking business. The total deposit

of the bank stood at Tk. 73,835.46 million as on 31 December 2009 against Tk. 58,833.o6 million of

the previous year with an increase of Tk. 15,002.40 million at a growth rate of 25.50%. The main

strategy of increasing deposit base is maintaining competitive rates of profit and satisfactory customer

service.

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Organizational Hierarchy

Chairman Advisor Board of Directors

Managing Director (MD)

Additional Managing Director (AMD)

Deputy Managing Director (DMD)

Senior Executive Vice President (SEVP)

Executive Vice President (EVP)

Senior Vice President (SVP)

Vice President (VP)

Senior Assistant Vice President (SAVP)

Assistant Vice President (AVP)

Senior Principal Officer (SPO)

Principal Officer (PO)

Executive Officer (EO)

Senior Officer (SO)

Management Trainee Officer (MTO)

Officer

Junior Officer (JO)

Assistant Officer (AO)

Trainee Assistant Officer (TAO)

Figure: Organogram of EXIM Bank Limited

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Board Audit Committee

Chairman Mr. A.K.M Nurul Fazal Bulbul

Members Mr. Md. Abdul Mannan

Mr. Zubayer Kabir

Mr. Muhammad Sekandar Khan

Secretary

Mr. Md. Golam Mahbub

Highlights on the Overall Activities (As at 31st December, 2010)

(Values in Million BDT)

Sl.

No.

Particulars 2008 2009 2010

01 Authorized Capital 3500.00 10000.00 10000.0002 Paid up Capital 2677.75 3373.96 6832.2703 Total Capital 5763.89 7718.89 10928.4004 Reserve Fund 1532.55 2092.97 3154.7605 Total Assets 68446.46 86213.37 113070.9806 Total Liabilities 63457.26 79496.16 100596.1307 Total Share holders’ Equity 4989.20 6717.21 12474.8508 Deposits 57586.99 73835.46 94949.4009 Investment (General) 53637.68 68609.91 83296.6510 Investment (Shares & Securities) 2894.02 2169.44 6012.8611 Operating Income 8356.82 10383.62 15646.7712 Operating Expenditure 5838.43 7201.84 9752.9813 Profit before Provision & Tax 2518.39 3181.78 5893.7914 Profit Before Tax 1989.55 2802.12 5308.9515 Net Profit after Provision & Tax 1096.63 1694.10 3476.0116 Investment as a % of total Deposit 93.14% 92.92% 98.26%17 Dividend:

Cash

Bonus

Right Share

26

--

26

--

35

--

35

1R:2

35

--

35

--18 Cost of Fund 9.52% 9.09% 7.10%19 Net Asset Value (NAV) Per Share 18.63 19.91 18.2620 Earning Per Share (EPS) 3.40 2.64 5.3521 Price Earning (P/E) Ratio 8.43 14.28 11.34

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22 Return on Asset (ROA) after Tax 1.83% 2.19% 3.54%23 Return on Investment (ROI) 2.03% 9.38% 35.01%

24 No. of Employees 1312 1440 168625 No. of Branches 42 52 59

Source: Annual Report 2009, & Auditor’s Report 2010, EXIM Bank Ltd.

Table: Three Years Performance at a Glance

General terms and Condition of EXIM (Export Import) Bank Bangladesh Limited

• The account will be operated as per Mudaraba Principles except Al- Wadiah CD account. At

least 65% of investment income will be distributed among the Mudaraba Deposits as per

weight age allocated for each account.

• Bank reserves right to chance the weight age and the profit distribution principles as per Bank’s

standard and policy.

• The laws, rules and regulations of Bangladesh, custom and procedures applicable to the

scheduled bank in Bangladesh will shall apply to and govern the conduct of the account opened

with bank.

• Service charge or maintained charge of account shall be levied by the bank from time to time

as per bank’s standard and policy. Bank reserves right to recover all costs and expenses

(including collection fees and legal expenses) arising in any way in connection with the

account, apart from the government usual excise duty and other charges.

• Though the Bank maintains strict confidentially in all affairs of the account and business, bank

shall always be entitled to disclose any information regarding customers business and accounts

held with the bank to any of the followings-

• Any regulatory, supervisory, governmental or quasi governmental authority with the

jurisdiction over the bank.

• Any person to whom the bank is required or authorized by law or court order to make

disclosure.

• Any change of the information furnished by the customer herewith must be notified to the

bank immediately, otherwise the bank will not liable for the consequences.

• The customer agrees that the bank will not be liable for any loss or damage if the bank is

unable to provide services in connection with any customers accounts due to postal, currier,

electrical, mechanical, telecommunications or by reason of god, catastrophe, war, civil or

industrial disturbance, computer failure or any other cause beyond banks control and that

cannot be overcome by reasonable diligence and without unusual expenses.

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• The bank reserves right to close any account without giving prior notice if the operation of the

account is unsatisfactory in the opinion of the account in unsatisfactory in the opinion of the

bank or any other reasons whatsoever. The opinion passed by the bank in this regard shall be

final and conclusive and binding upon the customer.

• The bank reserves right to amend the present rules at any time in any manner as it deems

necessary with or without giving prior notice to the account holders separately or to the public.

• In case of death of account holders, the account shall cease to be operative and the entire

deposited amount with profit (if applicable) shall be paid to the nominees as mentioned in the

account opening form. If the nominee is minor, the same shall be paid to the legal guardian of

the minor. In other cases, the amount shall be released as per rules in force.

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Chapter 3: Product Information of EXIM Bank3.1 Products

Mudaraba Monthly Saving Scheme (Money Grower):

The prime objective of this scheme is to encourage people to build up a habit of saving. In this scheme

one can save a fixed amount of money every month and receive substantial lump sum of money after

five, eight, ten or twelve years.

Highlight of the scheme –

1 Savings period and monthly instalment rate

1 The savings period is for 5,8,10 or 12 years

2 Monthly instalment rate is Tk. 500/-,1000/-,2000/- or 5000/-

2 Monthly instalment deposit

1 The savings amount is to be deposited within the 10th of every month. In case of holi-

days the deposit amount is to be made on the following day.

2 The deposit may also be made in advance.

3 In case the depositor fails to make the monthly instalment in time, then 5 % on over-

due instalment will be charged .The charge will be added with the following months

instalment.

3 Withdrawal

1 Generally withdrawal is not advised before a 5 year term, but if it is withdrawn be-

fore the above term, then profit will be paid at savings rate. However, no profit will

be paid if the deposit is withdrawn in 1year of opening the account.

2 In case the depositor wises to withdraw between the 5,8,10 or 12 year period then full

profit will be paid for a completed term and savings rate will applicable for the frac-

tional period.

4 Loan Advantage

After 3 years of savings in this scheme the depositor (if and adult) is eligible for a loan up

to 80 % of his / her deposited amount. In that case, profit rate will be applicable as per pre-

vailing rate at that time.

5 Reasons for disqualification from this scheme

If the depositors fail to pay 3 instalments in a row, then he / she will be disqualified

from this scheme and profit will be applicable as mentioned in withdrawal cause.

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Mudaraba Monthly Income Scheme:

Under this scheme, customer has to deposit a fixed amount of money for five years and in return he

will receive benefit on monthly basis. Benefits start right from the first month of opening an account

under the scheme and will continue up to five years when the depositor will get refund of his deposit.

This scheme is a sure investment for a steady return. Highlight of the scheme are:

1. Minimum deposit Tk. 50,000/-

2. Higher monthly income or higher deposit

3. Any person deposited his or her money for 1 Month to long term, whatever he or she wants.

4. No profit shall be allowed for premature encashment within one year.

5. Profit shall be allowed at provisional rate of Mudaraba Savings Accounts.

6. Monthly income will be credited to the depositor’s account after 1 month.

DEPOSIT AMOUNT TERM PROFIT RATE (%) MONTHLY PROFIT

Tk50,000 5 years 10.50 Tk. 437.5/-

Tk. 100,000 5 years 10.50 Tk. 875/-

Tk300,000 5 years 10.50 Tk2625/-

Tk.500,000 5 years 10.50 Tk. 4375/-

Mudaraba Education Saving Scheme:

The most gratifying experience for parents is proper education of their children. Education expense is

rapidly increasing and therefore appropriate planning needs to be done by all parents. EXIM bank offer

“Education Saving Scheme” to assist in financial planning well ahead in time for the children’s higher

education. Deposit of Tk 25000 and multiples there of at a time will be accepted under the scheme.

The instrument shall be issued for seven years, 10 years, and 20 years terms.

Mudaraba Multiplus Savings Scheme:

Savings helps to build up capital and capital is the prime source of business investment in a country.

Investment takes the country towards industrialization, which eventually creates wealth. That is why

savings is traded as the very foundation of development. To create more awareness and motivate

people to save EXIM bank offers Multiple invest their savings under this scheme. The fund will be

triple in 10 years period. The deposit can be made in multiples.

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Terms and condition of the scheme –

1 Any individual, company, educational institution, government organization, NGO , trust

, society etc may invest their savings under this scheme

2 The deposit can be made in multiples of Tk. 10000 /-

3 The period of deposit is 10 years. But the deposit can be withdrawn at any year with in-

terest. E.g. if deposit is withdrawn after completion of 1 year but before 2 years then de-

posit with interest will be paid for one year only. The same rule will apply for other

years .No interest will be paid before 1 year.

4 Any customer can open more than one account in a branch in his / her name or joint

names. A deposit receipts will be issued at the time of opening the account.

5 The depositor can avail loan up to 80 % of the deposit under this scheme.

6 In case of issuing duplicate receipt the rules of issuing a duplicate receipt of term de-

posit will be applicable.

7 In case of death of the depositor before the term, the deposit ( with interest at savings

rate) will be given to the nominee . In the absence of the nominee, the heirs / successors

will be paid on production of succession certificate. The nominee may , at his / her op-

tion, continue the scheme for the full term .

For example, If any one can deposit TK. 1,00,000/- than he /she will get TK, 3,00,000 at the maturity

period.

Mudaraba Super Saving Scheme:

Super Saving Scheme offer a small depositor to invest his fund (minimum Tk.10000/-) and the fund

will be double in 6(six) years period. This scheme will secure the future of the investment with ease.

Terms and conditions of the scheme-

1) Any customer can open more than one account in a branch in his / her name or joint names.

2) If the deposit is withdrawn before 6 years term, then savings interest rate +1 % will be applied

before payment is made

3) A depositor can avail Loan up to 80% of the deposited amount under this scheme.

4) In case of death of depositor before the term, the deposit (with interest at savings rate + 1%)

will be given to the nominee. The nominee at his / her option, continue the scheme for the full

term.

5) The Government taxes will be deducted, if necessary, from the accumulated profit, in future.

6) The profit rate will be calculated in provisional basis.

Example: If any one can deposit TK. 1,00,000 than he / she will get TK. 200000 at the maturity period.

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3.2 Investment Department

EXIM Bank Limited offers its valuable customer both consumers credit Schemes and financing for

small , medium and large scale business and industries that fulfil requirements of the bank and have

good return to the investment as well as satisfy the client. The bank’s loans and advances grew steadily

during 2009 and 2010.

Dispatch

The literal meaning of the term dispatch is to send away hastily to receive the official messages. The

EXIM Bank maintains two types of dispatch.

1) Inward Dispatch

Inward mail is first received and then given entry to the inward register. Than the manager read this

mail and send various departments for necessary action.

2) Out ward Dispatch

Out ward mail is classified into ordinary letter and registered parcel. EXIM Bank also maintains the

dispatch file which includes the sending of Pay order to the different bank as a foreign remittance.

.Mudaraba Term Deposit Receipt Account:

It is shortly known as MTDR. It can be also call FDR. By MTDR a person can deposited money at

secure time and for that this person will get benefit of profit on this amount. The amount of depositing

money will be at least TK. 10,000. One or more can be opened in the same name at the same branch of

the bank. There have some rules of MTDR. These are:

1. No profit shall be allowed for premature encashment within one month.

2. The provisional rate of profit of Mudaraba Savings Account will treat the provisional rate of

profit, which was prevailed at the time of opening MTDR account.

3. In case of death of account holders, the nominees may continue the account till maturity

4. Account holder is liable to pay government tax of 10% amount of his profit of MTDR.

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Mudaraba Super Savings Scheme:

This is one type of MTDR but have some dissimilar. Its shortly know as MSSS. There have also some

rules and regulation to get profit. These are:

1) The amount of depositing money will be at least TK. 5000.

2) No profit shall be allowed for premature encashment within one year.

3) If any person deposited his or her money for 6 years this person will get double profit of

amount of actual money.

4) Account holder is liable to pay government tax of 10% amount of his profit of MSSS.

Mudaraba Multiplus Savings Scheme:

This is one type of MTDR, but has some differences. It is shortly know as MMSS. It is as like as long

term investment, like 10 years. There have also some rules and regulation to get profit. These are:

1) The amount of depositing money will be at least TK. 5000.

2) No profit shall be allowed for premature encashment within one year.

3) Any person deposited his or her money for 10 years, who will get triple profit of amount of

actual money.

4) Account holder is liable to pay government tax of 10% amount of his profit of MMSS.

Mudaraba Monthly Income Scheme:

It is shortly know as MIS. It may be for short term or long term investment for getting profit. There

have also some rules and regulation to get profit. These are:

1) The amount of depositing money will be at least TK. 50000.

2) Any person deposited his or her money for 1 Month to long term, whatever he or she wants.

3) No profit shall be allowed for premature encashment within one year.

4) Profit shall be allowed at provisional rate of Mudaraba Savings Accounts.

Mudaraba Monthly Saving Scheme:

It is also as like as long term investment for getting profit. There have also some rules and regulation

to get profit. These are:

1) The amount of depositing money in every month will be at least TK. 500 to TK. 50,000.

2) Any person deposited his or her money for minimum 5 years to 12 years.

3) No profit shall be allowed for premature encashment within one year.

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Chapter 4: General Banking

General banking is the starting point of all the banking operations. It is the department, which provides

day-to – day services to the customers. Every day it receives deposits from the customers and meets

their demand for cash by honouring cheques. It opens new accounts, remit funds, issues bank draft and

pay orders etc. Since bank is confined to provide the services everyday, general banking is also known

as “Retail Banking”. In EXIM Bank, the following departments are under general banking section:

4.1 Account Opening Section

4.2 Deposit Section

4.3 Cash Section

4.4 Remittance Section

4.5 Clearing Section

4.6 Accounts Section

4.1. Account Opening section:

Account opening is the getaway for clients to enter into the business with bank. It is the foundation of

the banker customer relationship. This is one of the most important sections of a branch, because by

opening accounts bank mobilizes fund for investment. Various rules and regulation are maintained and

various documents are taken while opening an account. A customer can open different types of

accounts through this department. Such as:

1. Al-Wadeeah Current Account

2. Mudaraba Savings Account

3. Mudaraba Term Deposit Account (3-month/6month/12 month/24month/36month terms)

4. Fixed Account

There are some rules and procedures provide by the bank to open and operate the account. Maintaining

those procedures the following parties can open any accounts:

5 Individuals/ joint account

6 Proprietors account

7 Limited company account

8 Club/ societies account

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4.1.1 Types of Accounts with terms and conditions:

Al-Wadeeah Current Account

Current account is purely a demand deposit account .There is no restriction on withdrawing money

from the account. It is basically justified when funds are to be collected and money is to be paid at

frequent interval.

Some important points are as follows-

1 Minimum opening deposit of Tk. 5000/- is required.

2 There is no with draw limit.

3 No interest is given upon the deposited money.

4 Minimum Tk. 1000/- balance must be maintained all the time.

Mudaraba Savings Account

This deposit is primarily for small – scale savers hence, there is a restriction on withdrawals in a month

.heavy withdrawals are permitted only against prior notice. Some important points are as follows-

1 Minimum opening deposit of Tk. 1000/- is required.

2 Minimum Tk.1000/- balance must be maintained all the time.

3 Withdrawal amount should not be more than ¼ of the total balance at a time and limit twice in

a month.

4 If withdrawal amount exceed ¼ th of the total balance at a time, no interest is given upon the

deposited money for that month.

Mudaraba Term Deposit Account

Normally various large companies, organizations deposit money in Mudaraba Term Deposit Account.

Frequent withdrawal is discouraged and requires prior notice. The deposit should keep for at least 7

days to get interest. The profit offered for Mudaraba Short Term Deposit Account is less than that of

savings deposit. Profit is calculated based on daily minimum product and paid two times in a year.

Profit rate is 4%.

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4.1.2 Account Opening Procedure:

Step – 01

The account should be properly introduced by any one of the following:

1 An existing Current Account holder of the bank.

2 Officials of the bank, not below the rank of an Assistant Officer.

3 A respectable person of the locality who is well known to the manager / Sub Manager of the

branch concerned.

Step - 02

Receiving filled up application in bank’s prescribed form mentioning what type of account is

desired to open.

Step – 03

1 The form is filled up by the applicant himself.

2 To copies of passport size photographs from individual are taken, in case of firm’s Photographs

of all partners are taken.

3 Applicants must submit required documents.

4 Applicants must sign specimen signature sheet and give mandate.

5 Introducer’s signature and accounts number- verified by the legal officer.

Step – 04

Authorized officer accepts the application

Step – 05

Minimum balance is deposited – only cash is accepted

Step – 06

Account is opened and a cheque book and pay-in-slip book is given

4.1.3 Documents required for opening account:

•••• Individual / Joint Account:

01. Introduction of the account.

02. Two photograph of the signatories dully attested by the introducer

03. Partnership letter dully signed by all partners (Sign should be similar as stated in the

Partnership Deed)

04. Partnership Deed duly certified by notary public.

05. Registration.

06. Updated Trade License.

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•••• Proprietors Account

0 Introduction of the account

02. Two photograph of the signatories dully attested by the introducer

03. Valid copy of Trade License

04. Rubber Stamp

05. TIN number certificate

06. Identity (copy of Passport

07. Permission Letter from DC / Magistrate ( in case of newspaper)

•••• Limited Company’s Account:

01. Introduction of the account

02. Two photograph of the signatories dully attested by the introducer

03. Valid copy of Trade License

04. Board resolution of opening A/C duly certified by the Chairman /Managing

Director.

05. Certificate of Incorporation.

06. Certificate of Commencement ( in case of Public Limited Company)

07. Certified (Joint Stock) true company dully attested by the Chairman /Managing

Director.

08. List of Directors along with designation & signature.

09. Latest certified copy from – xii (to be certified by the registrar of the Join Stock

Companies in case of Directorship change).

10. Rubber Stump (Seal with designation of each person)

11. Certificate of registration (in case of Insurance Company – obtained from

department of Insurance from the People’s Republic of Bangladesh).

•••• Club / Societies Account:

01. Introduction of the account.

02. Two photograph of the signatories dully attested by the introducer

03. Board resolution of opening A/C duly certified by the President/ Secretary.

04. List of Existing Managing Committee.

05. Registration.

06. Rubber Stamp.

07. Permission letter from Bureau N.G.O. (in case of N.G.O A/C)

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4.1.4 Closing of an account:

The closing of an account may happen:

• If the customer is desirous to close the account.

• If the EXIM Bank finds that the account is inoperative for a long duration.

• If Garnishee Order is issued by the court on EXIM Bank.

To close the account, the cheque book is to be returned to the bank .EXIM Bank takes all the charges

by debiting the account and remaining balance is then paid to the customer. Necessary entries are

given to the account closing register and computer.

4.2 Deposit section4.2 Deposit section ::

Deposit is the life blood of a bank .Form the history and origin of the banking system we know that the

deposit collection is the main function of a bank.

Accepting Deposit:

The deposits that are accepted by EXIM Bank like other banks may be classified into –

(a) Demand Deposit

(b) Time Deposit

Demand Deposit:

EXIM Bank accepts demand deposits through the opening of –

(a) Current Account

(b)Savings Account

(c) Call Deposits from the fellow bankers.

Time Deposits:

A deposit which is payable at a fixed date or after a period of notice is a time deposit. EXIM Bank

accepts time deposits trough Fixed Deposit Receipt, Short Term Deposit (STD) and bearer Deposits

(BCD) etc.

While accepting these deposits, a contract is done between the bank and its customers. When the

bankers open an account in the name of the customer, there arises a contract between the two .This

contract will be valid one only when the both the parties are competent to enter into contracts. As

account opening initiates the fundamental relationship and since the banker has to deal with different

kinds of persons with different legal status, EXIM Bank Officials remain very much careful about the

competency of its customers.

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4.3 Cash section:4.3 Cash section:

Bank, as a financial institution, accepts surplus money from the people as deposit and given them opportunity to withdrawal the same by cheque etc. But among the banking activities cash department play an important role. It does the main function of a commercial bank i.e. receiving the deposit and paying the cash on demand .As this department deals with the customers directly, the reputation of the bank depends much on it.

The function of cash department are described below –

Cash Payment

•1 Cash payment is made only against cheque.

•2 This is the unique function of the banking system , which is known as” payment on demand”

•3 It makes payment only against its printed valid cheque.

Cash Receipt

•1 It receives deposits from the depositors in form of cash.

•2 So it is the “mobilization unit” of the banking system.

•3 It collects money only its receipts forms.

4.4 Remittance Section:4.4 Remittance Section:

Local Remittances

Carrying cash money is troublesome and risky. That’s why money can be transferred from one place to another through banking channel. This is called remittance. Remittances of funds are one of the most important aspects of the commercial banks in rendering services to its customers. Types of remittances:

• Between banks and non-bank customers • Between banks in the same country • Between banks in different centres • Between banks and Central Bank in the same country• Between Central Bank of different customers

The main instruments used by the EXIM Bank of remittance of funds are

1 Payment order (PO)2 Demand Draft (DD)3 Telegraphic Transfer (TT)

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So the basic three types of local remittances are discussed below:

Points Pay Order Demand Draft Tele Graphic Transfer

Explanation

Pay order gives the payee the right to claim payment from the issuing

bank.

Demand draft is an order of issuing bank on another branch to the same bank to pay

specified sum of money to payee on

demand.

Issuing branch requests another branch to pay

specified money to the specific payee on

demand by Telegraph/Telephone

Payment fromPayment from issuing branch

only

Payment from ordered branch

Payment from ordered branch

Generally used to Remit fund

Within the clearing house area of issuing

branch

Out side the clearing house area of issuing

branch. Payee can also be the purchaser.

Anywhere in the country.

Payment process of the paying bank

Payment is made through clearing.

01. Confirm that the D.D is not forgetting one.02. Confirm with sent

advice.03. Check the “test code”.04. Make payment.

01. Confirm issuing branch.02. Confirm payee A/C.03. Confirm amount.04. Make payment.05. Receive advice.

Charge Only commission Commission +Telex charge

Commission +telephone

Commission for Payment Order:

EXIM Bank charges different amount of commission on the basis of the payment order amount. The bank charges for pay order are given in the following chart:

Total amount of PO Commission VATUp to Tk. 10,000.00/- Tk. 15.00/- Tk. 3.00/-

Tk. 10,001.00/-Tk. 100,000.00/-

Tk. 25.00/- Tk. 4.00/-

Tk. 100,001.00/-Tk. 500,000.00/-

Tk. 50.00/- Tk. 8.00/-

Tk. 500,001.00/-and above

Tk.100.00/- Tk. 15.00/-

4.5 Clearing Section:4.5 Clearing Section:

The amount of cheques, pay order, demand draft, and collection of amount of other banks on behalf of its customer is a basic function of a Clearing Department.

Clearing

Clearing is a system by which a bank can collect customers fund from one bank to another through clearing house.

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Clearing house

Clearing house is a place where the representatives of different banks get-together to receive and deliver cheque with another banks.Normally, Bangladesh Bank performs the clearing house activities in Dhaka, Chittagong, Rajshahi, Khulna and Bogra. Where there is no branch of Bangladesh Bank, Sonali Bank arrange this function.

Member of Clearing house

EXIM Bank is a scheduled bank. According to the Article 37 (2) of Bangladesh Bank Order, 1972, the banks, which are the member of the Clearing house, are called as scheduled banks. The scheduled banks clear the cheques drawn upon another through clearing house.

Types of Clearing:

01. Outward Clearing: When the branches of a bank receive cheque from its customers drawn on the other banks within the local clearing zone for collection through clearing houses, it is outward clearing.

02. Inward Clearing: When the bank receives cheque drawn on them from other banks in the clearing house, it is inward clearing.

Types of Clearing house:

There are two types of clearing houses –

01. Normal Clearing house02. Same day Clearing house

Normal Clearing house:

01. 1st house: 1st house normally stands at 10a.m. to 11 a.m. 02. 2nd house: 2nd house normally stands after 3 p.m. and it is known as return house.

Same day Clearing house:

01.1st house: 1st house normally stands at 10a.m. to 11 a.m. 02. 2nd house: 2nd house normally stands after 2 p.m. and it is known as return house.

11 Who will deposit cheque for clearing? Who will deposit cheque for clearing?

Only the regular customer i.e. who have Savings, Current, STD, and Loan A/C in the bank can deposit cheque for collection for fund through clearing house.

Precaution at the time of cheque receiving for Clearing, Collection of LBC, OBC and Transferred:

01. Name of the account holder same in the cheque and deposit slip.02. Amount in the cheque and deposit slip must be same in words and in figure.03. Date in the cheque may be on or before (but not more than 6 months back) Clearing

house date.04. Bank and branch name of the cheque, its number date in the deposit slip.

33

05. Cheque must be signed06. Signature for the conformation of date, amount in words / in figures cutting and

mutilation.07. Cheque should be crossed (not for bearer cheque).08. Account number in the deposit slip must be clear.09. Depositor’s signature in the deposit slip.

Return House:

Return House means second house where the representatives of the bank meet after 3 p.m. to receive and deliver dishonoured cheque, which placed in the first clearing house. Cheque may be dishonoured for any one of the following reasons:

1. Insufficient fund.2. Amount in figure and word differs.3. Cheque out of date / post – dated. 4. Payment stopped by the drawer5. Drawer’s signature differ / required 6. Crossed cheque to be presented through a bank.7. Other specific reasons not mentioned above.

The dishonoured cheque entry in the Return Registrar and the party is informed about it. Party’s signature required in the Return Registrar to deliver the dishonoured cheque .After duration, the return cheque is sent to the part’s mailing address with return memo.

If the cheque is dishonoured due to insufficiency of funds, then EXIM Bank charges Tk. 25/- as penalty.

Responsibility of the concerned officer for the clearing cheque:

1. Crossing of the cheque 2. (Computer) posting of the cheque 3. Clearing seal and proper endorsement of the cheque.4. Separation of cheque from deposit slip 5. Sorting of the cheque 1st bank wise and then on branch wise 6. Computer print 1st branch wise and then bank wise.7. Preparation of 1st clearing house computer validation sheet ‘8. Examine computer validation sheet to justified the computer posting9. Copy of computer posting in the floppy disk.

Bills Collection:

In modern banking the mechanism has become complex as far as smooth transaction and safety is concerned. Customer does pay and receive bill from their counterpart as a result of transaction. Commercial bank’s duty is to collect bills on behalf of their customer.

Types of Bills for collection –

1. Outward Bills for Collection (OBC)2. Inward Bills for Collection (IBC)

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11 What is OBC?What is OBC?

OBC means Outward bills for Collection. OBC exists with different branches of different banks out side the local clearing house. Normally two types of OBC –

• OBC with different branches of other banks• OBC with different branches of the same bank

Procedure of OBC:

1. Entry in the OBC register 2. Put OBC no. in the cheque 3. “Crossing seal” on the left corner of the cheque and “payees account will be Credited on realization” seal on the back of the cheque with the signature of the Concerned Officer 4. Dispatch the OBC cheque with forwarding 5. Reserve the photo copy of the cheque, carbon copy of the forwarding andDeposit slip of the cheque in the OBC file.

Commission for collection:

Up to 1 Lac ------------------------------------------- 0.15 %

Above 1 Lac-------------------------------------------- 0.10 %

Above 5 Lac--------------------------------------------0.05%

Inward Bills for Collection (IBC):

When the banks collects bills as an agent of the collecting branch, the system is known as IBC. In this case bank will works as an agent of the collection bank. The branch receives a forwarding letter and the bill.

Procedure of IBC:

1. IBC against OBC: To receive the OBC cheque first we have to give entry in the IBC register. The IBC number should put on the forwarding of the OBC with date.

2. Deposit of OBC amount: OBC cheque amount is put into the “sundry depository credit account”, prepare debit and credit voucher of it. If the OBC cheque is honoured, send credit advice (IBCA) with signature and the advice number of the concerned branch for the OBC amount.

3. If the OBC cheque is dishonoured, the concerned branch is informed about it.

4. Against place in the clearing house or send the OBC cheque with return Memo to the issuing branch according to their information.

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4.6 Accounts Section:

Accounts department is called as the nerve centre of the bank. In banking business, transactions are

done everyday and these transactions are to be recorded properly and systematically as the banks

deal with the depositors’ money. Improper recording of transaction will lead to the mismatch in the

debit side and in the credit side. To avoid these misshapes, the bank provides a separate department;

whose function is to check the mistakes in passing vouchers or wrong entries or fraud or forgery.

This department is called as Accounts Department. If any discrepancy arises regarding any

transaction this department report to the concerned department.

Besides these, the branch has to prepare some internal statements as well as some statutory

statements, which are to be submitted to the Central Bank and the Head Office. This department

prepares all these statements.

Workings of Accounting Department:

• Recording the transactions in the cash book

• Recording the transactions in general and subsidiary ledger

• Preparing the daily position of the branch comprising of deposit and cash

• Preparing the daily Statements of Affairs showing all the assets and liabilities of the

branch as per General Ledger and Subsidiary Ledger Separately.

• Making payment of all the expenses of the branch.

• Recording inter-branch fund transfer and providing accounting treatment in this

regard.

• Preparing the monthly salary statements for the employees.

• Preparing the weekly position for the branch which is sent to the Head Office to

maintain Cash Reserve Requirement( C.R.R)

• Preparing the monthly position for the branch which is send to the Head Office to

maintain Statutory Liquidity Requirement (S.L.R).

• Make charges for different types of duties

• Preparing the budget for the branch by fixing the target regarding profit and deposit

so as to take necessary steps to generate and mobilize deposit.

• Checking of Transaction List.

• Recording of the vouchers in the Voucher Register

• Packing of the correct vouchers according to the debit voucher and the credit

voucher.

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Chapter 5: Findings

Export Import Bank of Bangladesh Limited is a third generation private commercial bank in the

country with commendable operating performance. Directed by the mission to provide prompt and

efficient services to clients, EXIM Bank has successfully celebrated its twelfth year of operation. It

provides a wide range of commercial services. The Bank has achieved success among its peer group

within a short span of time with its professional and dedicated team of management having long

experience, commendable knowledge and expertise in convention with modern banking.

� The management of the bank is maintaining an efficient portfolio in order to have a healthy

growth and retain customer satisfaction. In order to avoid asset liability mismatch the manage-

ment of the bank is constantly monitoring the bank’s business portfolio. The bank has a Well-

diversified and balanced advance portfolio consisting of agriculture, industrial, garments, im-

port construction, trade & commerce, export, transport, consumer, and other sectors. The li-

quidity risk is minimized to maximum extent.

� The management of the Bank is prudently monitoring the market situation to keep the deposit

interest rate at minimum and also trying to invest at a reasonable rate to increase the profitabil-

ity of the Bank. Also efficient management of portfolio would reduce the amount of classified

loans to a minimum level, which at the end will sustain the earnings of the Bank.

� EXIM Bank is engaged in modern banking. It is expected that EXIM Bank by its efficient asset

and liability management will be able to maintain its trend of growth and thus overcome the

threat.

� EXIM Bank has been able to maintain a very low classified portfolio over the last twelve years

of operations. Its present classified portfolio stands very low of the total loan portfolio in the

year 2009. This demonstrates the Bank’s professional management ability.

37

� Recognizing the risks of unfair and hostile competition in the banking industry EXIM Bank

has, since its inception, focused on diversified client base with an innovative and differentiated

product base. This strategy has been rewarding for EXIM, and it plans to remain innovative in

future also by way of creating new markets for its products.

� Foreign exchange risks originating from transactions have always been professionally managed

in EXIM Bank.

� EXIM Bank having small and targeting niche markets is likely to be less affected by restrictive

monetary and/or fiscal policy.

� Although EXIM Bank is yet to be fully automated the Bank has adequate technology to meet

its present requirement and it proceeding aggressively to enhance its technology level. Many

products are introduced in the market in recent days and more innovative and diversified

products are in the offering. The products are well received by the market, which is evident

from the growth pattern of those products. The bank is recruiting fresh university graduates on

regular basis and arranging training for them both from its own and other training institutions.

Side by side the Bank is hiring experienced and skilled human resource in an effort to balan-

cing out the need of the Bank in various fields of its operation. The bank has also introduced

various welfare schemes for its employees with a view to retain its trained and experienced hu-

man resources on longer term basis and to create a sense of belongingness. The bank Manage-

ment believes that lower employee turnout ratio will improve productivity of the banking fu-

ture.

� The Management has been following a Loan and Advance Policy, which will be continued in

future. Therefore, it is expected that the loan loss provisioning in future will be within tolerable

limit having little material impact on future profitability as well as net worth.

� As EXIM Bank is performing well in traditional general banking and there is a good demand

for Islamic Banking, the management of the Bank is also expecting god result in Islamic bank-

ing operation.

38

Chapter 6: Recommendation and Conclusion6.1 Recommendations

EXIM Bank is a third generation private commercial bank in the country with commendable operating

performance. Some recommendations regarding bank’s betterment are described below. The

recommendations given below are not decisions; rather they are only suggestions to improve the

performance in order to fulfil the customer satisfaction so that clients give more preference to EXIM

Bank. The recommendations are made on the basis of survey findings and analysis and these are:

1. Increasing branch number to increasing wide geographical coverage throughout the country.

2. Introducing online banking for providing advanced technological facilities to customers.

3. More ATM booths are necessary for giving prompt service to clients..

4. Implementing adequate IT infrastructure to provide international service standard to customers.

5. Adding some promotional offers to large balance bearing clients.

6. Emphasis on corporate social responsibility is also necessary. Sponsorship in different social

programs can flourish bank image.

7. EXIM should go to aggressive advertising and promotional activities to get a broad geographic

coverage.

8. To gain success in the programs like "Poverty Alleviation” and "Self Reliant" especially in rur-

al areas, this bank should provides investment facilities on the basis of individual.

9. To fulfil the vision of "mass banking" this Bank should grants investment portfolio to new en-

trepreneurs /new businessmen new companies etc.

6.2 Conclusion

EXIM Bank is a private sector bank having a small market share of the industry. Although it is a third

generation bank facing government deposit restrictions, it has all the potentials to penetrate in the

market. If the weakness are addressed appropriately and opportunities are explored keeping in view the

threats behind with a stable and adroit management having regard to appropriate corporate governance

and modern automation technology, it is expected that EXIM advance up in the ladder of success in

the coming years.

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Bibliography

• Annual Report 2010, Exim Bank

• Financial Statements of EXIM Bank of the year ended 31st December 2010.

• Banking Manuals of EXIM Bank.

• Statement of Affairs, EXIM Bank (Sylhet Branch).

• A/c Opening Form.

• KYC Form

• General Banking Operation Manual (EXIM Bank)

• Rights Share Offer Document (EXIM Bank).

• Mojibur Rahman, Banking

• Money, Banking and International Trade, 8th Edition, M.C. Vaish.

• L.R. Chowdhury, A Text Book on Bankers Adverces, 2nd Edition.

• Md. Hider Ali, A Hand Book of Islamic Banking & Foreign Exchange Operation.

• Islamic Bank Bangladesh Limited, Investment and Bank Guarantee Manuals.

• www.eximbd.com

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