Internshp on Performance Evaluation of Exim Bank Ltd

Internship REPORT ON EXPORT IMPORT wedgeing comp each LIMITED TOPIC movement valuation of EXIM stick Ltd. modified Focus on unusual Exchange Division surgical incision of blood arrangeion Submitted by www. AssignmentPoint. com Date of Submission 17th May2012 LETTER OF TRANSMITTAL 17th May2012 To Lecturer Department of Business brass Subject Submission of the BBA Internship Report. Dear Madam, It is a great Pleasure for me that I ease up got the hazard to submit the Internship Report on mathematical operation evaluation of Export importee brim of Bangladesh extra supernumerary focus on foreign r on the wholeying division.The internship program gave me an opportunity to view an exposure to the working milieu and on the job experience. I welcome acquired a good belowstanding on distribution course of instruction of acknowledgement of this multinational. I have tried my aim best to put meticulous effort for the preparation of this field. every short each( prenominal) overtures or fault may arise as my unintentional mistakes I pass on wholeheartedly satisfying each clarification and suggestion ab emerge any view and conception disseminated by dint of this calculate. Sincerely yours www. AssignmentPoint. com . supervisorS CERTIFICATIONThis is to certify that student of subdivision of BBA and major in Finance, has completed the Internship Report titled Performance Evaluation of EXIM camber Ltd. Special Focus on outside Exchange Division success beaty beneath my supervising. I wish her every success in life. Supervisor Lecturer Department of Business Administration Ac admitledgement Allah is Al competencyy to mock internship composition of my port of study of BBA Program. The accomplishment and completion of this report would no. have been viable without the portion of more or less people who took the term and effort to guide me in my report work.I deeply appreciate and value their suggestions and recomm terminalations through the entire course of my report work. I would like to conflagrate my heartiest thanks and my sincerest gratitude to only(a) those who directly/ indirectly contribute to the compilation of report. I am especially glad to my teacher, my internship supervisor. I could non prep be my Internship Report without her proper guidance and inspiration. Last but non least, I would like to give my thanks to all the members of EXIM buzzword Ltd. , Panthapath Branch because working with them was much(prenominal) a marvelous experience in my life that I will never for absorb.TABLE OF CONTENTS Particular Page No Executive Summary VIII CHAPTER-1 macrocosm 1 1. 1 Origin of the Report 2 1. 2 aim of the Report 2 1. General prey of the Report 2 1. 4 Specific objective of the Report 3 1. 5 Scope of the Report 3 1. 6 Limitations of the Report 4 1. 7 Methodology of the Study 4 1. Sources of Information 5 CHAPTER-2 Economic Conditions In Bangladesh 6 CHAPTER- 3 attention Analysis CHAPTER-4 Company Analysis 12 4. 1 Historical Background Of The Exim margin 13 4. 2 Vision 13 4. 3 Mission 13 4. 4 Objective 14 4. Strategy 15 CHAPTER-5 The General bordering Division 16 CHAPTER-6 imparts And Advances Department 24 25 29 CHAPTER-7 Foreign Exchange Department 39 CHAPTER-8 Competitive smudge of Export Import argot of Bangladesh hold in with Premier swan set 45 CHAPTER-9 SWOT & Financial Analysis 51 Swot Analysis Ratio Analysis CHAPTER-10 tribute & Conclusion 70 10. 1 Findings 71 10. 2 Recomm stamp outation 72 10. 3 Conclusion 73 Appendix 74 Bibliography 78 Executive Summary deposit is a nourisher oriented mercenary enterprise organization. The prime goal of this organization is earning profit as an other wise(p)wise business organization. customer answer is marrow squash product of the intrust. According to Bank Company Act 1991 clause 5(3) Banker subject matter t hat person or imbed of accepting for the purpose of lending or investment of down salary of m championy from public, repayable on occupy.To know your customer is the main slogan in new modern Banking System providing customer services. EXIM Bank Limited has earned a good reputation around Bangladesh. patronage competition among banks operating in Bangladesh twain local and beingness(prenominal), EXIM Bank has stupefy remarkable progress, practically in every sphere of its activities. Export Import Bank of Bangladesh Limited is a third generation private commercial bank in the domain with laudable operating public breakation. This study is in general establish on performance evaluation of EXIM Bank Ltd. Special focus on foreign exchange division. In do to claim foreign the report to a greater consequence meaningful and presentable, use both the original and utility(prenominal) sources of collection information. EXIM Bank Ltd. as al constitute constituted a party fav orable reputation in the banking industry of the acres. At is one of the leading private heavens commercial banks in Bangladesh. The bank has already shown a tremendous return in the profits and wedges beas. To get competitive advantage and to deliver quality service worry lot establish training base and confidence car should be introduced. The over all performance of the bank is very good jibe to its competitive typeset. Within a near future EXIM bank will be a food market attracter among the banks. 1. Introduction 1. 1 Origin of the Report In todays world only academic pro public does make a student perfect to become competitive with the embodied & Global business world.By doing an internship program, a student lowlife get the opportunity to learn facing nearly real business world. Internship is proudly needed to gain psyche knowledge and experience. I am a BBA graduate from Private University in Bangladesh. It has designed its curriculum of the BBA Program such a way that the international standard graduates will be produced. after completing my 139 faith hours I Need to go for further professional experience through Internship program in a Business organization EXIM Bank Ltd. is a place where I have learned the business relationss. This organization has created a positive image to the customers mind by providing better service specifically I am telling about the Panthapath Branch.This subdivision has introduced an exclusive modern banking scheme that has got tall market sharing and rating in the prominent business & banking avenue in Panthapath Bank way. As an BBA Internee Office I have tried to maintain the pace with the competitive business environment on official Activities Culture Philosophy Norms & Styles. It should be reflect the best at any field of my sea captain life The Vice President & Manger is my overall Guide Philosopher & Superior. By receiving his all sorts of cordial support I have been availed the opportunity to w ork with this branch for three months from 10th January 2010 to 9th March 2010. I acquired idea about real business and corporate world. 1. 2 Objective of the Report Prime objects to a big study on Banking System. 1. 3 General objective of the ReportThe report specification base on the overall banking performance evaluation and special focus on foreign exchange division of EXIM Bank Ltd. 1. 4 Specific objective of the Report ? To apply theoretical knowledge in the practical field. ? To make a bridge between the theories and practical procedures of banking day-to-day operations. ? To know the unalike modes of scheme, in EXIM Bank. ? Trend analyses of the different scheme. ? To know the pecuniary activity of bank. ? An overview on the major financial activity and practices of EXIM Bank ? To identify the strategies for EXIM Bank Limited, implementing in constant prosperity of the company ? Analyzing the performance trends of EXIM Bank. To give slightly idea about its management an d organization structure ? To present and overview of EXIM Bank Ltd. ? Comp ar the different mode of scheme of Exim Bank with other similar bank. 1. 5 Scope of the Report First the report presents about the current stinting stipulation of Bangladesh and the present condition of the banking sector of our country and next it gives some ideas about EXIM Bank Ltd. Then it analyzes the performance of the bank based on financial analysis and SWOT analysis. After that, it marks or foreign exchange division. By reading this report one jackpot easily have some ideas about the performance and foreign exchange division of EXIM Bank Ltd. 1. 6 Limitations of the ReportAlthough there were sincere co-operation from employees of EX1M Bank Limited, Panthapath Branch, they could non manage enough time to provide the necessary information for the completion of the report. During the preparation of the report the chase problems occurred that may be termed as the recoilation or shortcomings of th e study. Some of the limitations faced in preparing this report be ? Confidentiality the Banks policy restricts disclosing some information ? Data about the performance of the bank of the yr 2008 have non yet been disclosed by the bank. ? The study of such a short course of time is not free from limitation. ? The data relevant for the analysis report writing sometimes could not be hive away over collectable to excessive year-ending workload at the branch. It is too ofttimes difficult to comment and suggest based on only the annual report and information collected from written documents. ? As some assumptions were made with the help of limited information, there may be some personal mistake in the report ? It was very difficult to collect the information from various incumbents for the job restriction. 1. 7 Methodology of the Study Although there were so legion(predicate) limitations, it was tried to use both the primary and secondary sources of collecting information to ma ke the report presentable with as less abstraction as possible. 1. 8 Sources of Information Two sources (i) prime & (ii) substitute(prenominal) A.Primary data Primary data is always know as survey data. This type of data is collected from the respondent. For this personal Interview with the offices and customers have been conducted. B. Secondary Data Data that were published before for some other reason can be collected using internal and external sources. i) Internal secondary data To furnish the report properly some papers has been collected from the officials of EXIM Bank Ltd. Information from annual reports journals, newspapers and other published documents have been used besides other published information about the organization, attainment interview of the branch manager and second branch manager have also taken. i) External Secondary data For better interpretation some data has been collected from Bangladesh Bank. Inter mesh topology Browsing is also one source of external Secondary data. 2. ECONOMIC CONDITIONS IN BANGLADESH Bangladesh has an agrarian providence with 32% of gross domestic product coming from the Agriculture sector. Major agricultural products be rice, jute, wheat, potato, pulses, tobacco, tea and sugarcane. . The country is the largest exporter of jute and jute goods in the world. Readymade garments ar among the most marketable items. Tea, frozen shrimp, fish, leather goods and handicrafts be also major exportable commodities. The country has under gone a major shift in its economic philosophy and management in recent years.At Bangladeshs birth, the country embraced communism as the economic ideology with a dominant role for the public sector. and, since the mid-seventies, it undertook a major restructuring towards establishing a market economy with emphasis on private sector-led economic growth. During the nineties, the country has completed a major stabilization program which has reduced inflation as well as fiscal and curr ent flyer deficits and established a healthy foreign exchange reserve position with low and sustainable debt-service liabilities. With subaltern economic growth, the basic indicators related to health, education and poverty have all shown sustained improvement.According to a ball Bank opine, Bangladesh has the 36th largest economy in the world in terms of GNP based on the purchasing power parity method of valuation, and the 55th largest in terms of nominal GNP in U. S. Dollars. Bangladesh economy grew on an average at above 6. 0 percent in the last cardinal years up to FY07 . According to the provisional estimates of the Bangladesh Bureau of Statistics (BBS),real GDP recorded a strong growth of 6. 5 percent in FY07,which is marginally lower than 6. 6percent recorded in FY06 . This growth was commendable as it was procured in challenging environment marked by high and volatile oil price ,phasing out of the MFA quota, labour unrest in the garment industry and confrontational pol itical situation of the country in the premiere half of FY07. With reasonable support from agriculture sector, the 6. percent real GDP growth was underpinned mainly by industry sector and services sector. The expansion was broad based, registering positive growth by all sectors and sub-sectors of the economy. Spurred by a robust 9. 5 percent growth in industry sector and 6. 7 percent growth in services sector, GDP growth during the year was also aided by 3. 2 percent growth in the agriculture sector. The domestic nest egg-investment gap was met with net factor income from afield which increased by 37. 0 percent in FY07 from 4. 4 percent in FY06 reflecting higher economys growth. The domestic savings investment gap was met with net factor income from abroad which increased by 37. 0 percent in FY07.The rising trend of inflation of FY06 as measured by CPI intimidate in FY07 mainly due to higher prices of oil and some other trade goods in the international market, distortion in th e supply side factors and demand pressure generated from excess gold supply . laggard import of consumer necessities pulling their domestic prices heightened the price pressures. Annual average CPI (base FY96) inflation as of end June 2007was 7. 20 percent, compargond to 7. 16 percent as of end June 2006. There was notable increase of food prices cistron of CPI inflation from 7. 8 percent as of end June 2006 to 8. 1 percent as of end June 2007. Maintaining a favorable investment environment and a sound macroeconomic management ar all-important(prenominal) to strengthen private sector investment in the economy.In view of medium term outlook of sustainable economic growth and low inflation for world and south Asian economies and assuming continuation of careful policies and progress in advancing structural reforms, the near and medium term economic prospects of Bangladesh appear favorable. 3. assiduity ANALYSIS Bank plays an important role in this modern world. The organic evo lution of industries and business sectors of a country mainly depends on good banking system. The industries and businessman are taking short and long term lend from banks. In the modern world international businesses are fully depended on banks. Without sound banking system no country can develop in international vocation. Bank constitutes an important segment of the financial base of operations of any country. The economic history of many an(prenominal) countries reveals that economic development and growth of financial infrastructure go hand in hand.Financial system of a country is the heart of a countrys economic system as it connects suppliers of the investment firms and demanders of fund, which is needed to produce economic goods. It also provides a large range of employment opportunity. As Bangladesh is containing a bank base economy, its economic development is largely depended on the development of banking sectors. Bangladesh appeared as a new nation on the world map in the year 1971. After independence financial institutions, especially banks played a vital role in re-constructing the war-torn economy of Bangladesh. Bangladesh Bank is the central bank of the country and is in charge of monetary policies of the Government and controls all commercial banks. Development and growth of our banking system may be divided into three parts. The performance of our banking system during 1972 to 1982 was commendable in respect of expending network and providing easy credit to the socially desirable sectors but every bit frustrating with regard to maintaining validity and customer services. The second phase from 1983 to 1989 was characterized by denationalization and privatization of banking system without broad-basing the prudential and information regulatory framework however, these measures of denationalization and privatization could not bring the viability and operational efficiency of banking system.Under the above muckle and with the recommendation of World Bank, a Financial Sector Reform pop (FSRP) was undertaken in 1989 by the government, which can be identified with third phase of the development of our banking system. The government of Bangladesh has also enacted some important acts namely financial institutions act 1993, Securities and Exchange Commission act 1993, the companies act 1994 and recently Bankruptcy act 1997. The present day banking structure has evolved over several decodes. The far-reaching program of economic reform is being carried out at present towards efficient utilization of scare resources and the development of private entrepreneurship. Banks are financial service firms, producing and merchandising professional management of the publics fund as well as performing many other roles in the economy.Banks are those financial institutions that offer the widest rang of financial functions of any business firm in the economy. Competition is strengthened by the entry of new and innovative provides of financ ial services, through the development of Money market and hood market. Money market is designed for the qualification of short-term loans where individuals and institutions with temporary surplus of funds meet borrowers who have temporary specie shortages. great(p) market is deigned to finance long-term loans where individuals and institutions with temporary surplus of finds meet borrowers who have temporary cash in shortages. Capital market is designed to finance long-term investments.Private sector commercial banks are private companies operate under the legislative framework, which covers both Company Act, and Banking Company Act, under the on waiver financial liberalization, EXIM Bank emerges as a new Bank in private sector to operate at the Banking arena of Bangladesh It is committed to provide high quality financial services/ products to contribute to the growth of GDP of the country through stimulating passel and commerce, accelerating the pace of industrialization, boo sting up export, creating employment opportunity for the educated offspring , poverty alleviation, raising standard of living of limited income group and overall sustainable socio-economic development of the country. 4. society ANALYSIS 4. 1 HISTORICAL BACKGROUND OF THE EXIM BANK EXIM Bank- Export Import Bank of Bangladesh Ltd. was named at first as BEXIM Bank BEXIM stands for Bengal Export Import of Bangladesh. This new commercial Bank was opened in dreadful 03, 1999 with some new innovative visions in customer services.The Bank received the certificate of incorporate no. C-37864 (2164)/99 under the commencement of the business on the same day by the slit 150(2) under companies Act. A part from the steer office in Dilkusha C/A, it stared its first local branch in Motijheel C/A simultaneously in night club to provide all kinds of Banking support to the clients. On declination 02, 1999 the second branches both in Dhaka City and other cities. Now it has twenty-five branches in the country. 4. 2 VISION The gist of EXIM bank vision is Together Towards Tomorrow. Export Import Bank of Bangladesh Limbed believes in togetherness with its customers, in its march or the road to growth and progress with services.To achieve the desired goal, there will be pursuit of excellence at all stages with a climate of consecutive improvement, because, in EXIM Bank, they believe, the striving of excellence is never ending. Banks strategic plans and networking will strengthen its competitive edge over others in chop-chop changing competitive environments. Their personalized qualities services to the customers with the trend of constant improvement will be base achieve their operational success. 4. 3 MISSION The bank has checked out the spare-time activity corporate objectives in order to suss out smooth achievement of its goals- ? To be the most caring and customer friendly and service oriented bank. ? To create a technology base most efficient banking environment for it s customers ? To ensure ethical motive and transparency in ail levels To ensure sustainable growth and establish full value of the sound shareholders and ? Above all, to add effective contribution to the national economy Eventually the bank also emphasize on ? Provide high quality financial services in export and import trade ? Providing efficient customer service ? Maintaining corporate and business ethics ? Being trusted repository of customers money and their financial adviser ? Making its products superior and rewarding to the customers ? Display team spirit and professionalism ? Sound Capital Base ? Enhancement of shareholders wealth ? Fulfilling its social commitments by expanding its charitable and humanitarian activities 4. Objective Bangladesh is now intact part of global market. As such there is an urgent requirement for Bangladesh to place the traditional banking pretties in harness with the global trades of a free market economy by following international banking custom s, practices and standards. at once clients of a bank in Bangladesh are exposed as well as international markets. They have to stay update with their practice and standards to meet the demands of achieving harmony in the high standards of a free economy. EXIM Bank fully appreciates the importance and implication of the rapidly emerging competition in the banking and finance sector of Bangladesh.It intends support its customer suited to his or her place in the market. In this regards EXIM Bank emphasizes in its employment the software package aspects of human resource capability. It also emphasizes competence among its banking professional to cater to vary customer requirements to the modern time. The objectives of EXIM BANK is not only to earn profit but also to keep the social commitment and to ensure its co-operation to the person of alt level, to the businessman, industrialist specially who are engaged in establishing large-scale industry by pond and the agro-based export orie nted medium and small scale industries by self inspiration.EXIM BANK is always ready to maintain highest quality of services by upgrading banking technology prudence in management and by applying high standard of business ethic through its established commitment and heritage. EXIM BANK is committed to ensure its contribution to national economy by increasing its profitability through professional and disciplined growth dodging for its customer and by creating corporate culture in international banking area. 4. 5 Strategy In order to reach the goal it is important to build system and follow the policies. If it can select the appropriate strategy and choose the right policy, it will be very easy to touch its desired position.The distinguishing attribute of policy is to set the over all boundaries for activities. According to this system when the bank was started it has to decide what kind of business it is going to be in. The Bank also has to decide on its growth and communicate thr ough am system of major objective of the business is to reach the goal, to reach the desired position from the current status. There might be a turn of events of ways to reach there and its has to be decided which path would be easier to reach the objective. So the authority has no decided which path they select to proceed. The following figure can be explained clearly. Slogan of the EXIM Bank Local Bank Global NetworkThe world EXIM implies the meaning of its operation. through with(predicate) it is a new type of Bank in Bangladesh it is familiar with so many countries in the world such as Export Import Bank of the United States, Export Import Bank of Japan. Despite it is a local Bank, It has spread of its operation in the whole world through foreign Banking. To achieve the desired goal, it has intention to pursuit f excellence at stages with a climate of continuous improvement. Because it believes, the line of excellence is never ending. It also believes that its strategic plans and business networking will strength its competitive edge over in rapidly changing competitive environment.It motto I to provide quality service to the customers all over the world so, the slogan of the Bank Local Bank Global Network is completely adaptable with its operation. THE GENERAL BANKING DIVISION Internship has provided the opportunity to coordinate the theoretical knowledge that one has gathered in MBA distinguish with the practical field. Although three months is not a very long stoppage to learn the whole social occasion that usually occurs in an organization. The supervisor divided this report into three parts. 1) The general banking segment 2) The enthronement plane section 3) The foreign Exchange department. Learning experience from General Banking DivisionThe main business of this Division is dealings with Deposit. There are two types of Deposit in this Branch and General Banking division as the following section 1. Deposit section 2. government note Sectio n 3. Remittance section 4. Clearing section 5. Customer Service section 6. coin section and 7. Information Technology section Task I Handled in this Division is 1. source nebs 2. Opening Monthly saving scheme, 3. Modaraba Term Deposit Account Current 4. Deposit foreign current Deposit Account 5. Modarada short notice Deposit (STD). 6. resolute Deposit, Steady Money. 7. rationalise Draft (D. D) 8. Telegraphic counterchange (T. T) 9. giftment Order (P/O) 10. Travelers Check (T. C) 1. Issuing Check. Pay Order (PO) Pay order is one kind of unconditional promissory note or instrument that is issued by the Bank to the customer. The difference between check and pay order is the mode of en representativement. Demand Draft Demand Drafts are made for the change over of money from one place to another(prenominal) in the form of cheques through a particular Bank, which can be ensued right way. The Bank issues DD for their outer district branches. Telegraph/ Telephone Transfer When a ce rtain sum total of money is asked by the client to transfer from one branch to another than it is called telegraph/ telephone transfer. For TT, there is a particular from.When the form is filled up properly and deposits the make out by the applicant, the sure officer issued a be memo to the screening for their confirmation. lssuing cheques Books Checkbook issue is a very sensitive because most of the fraud occurs through this checkbook. Customer requiring check books to fill out requisition ship. For saving accounts 10 pages check book issued and CD/SOD/ CC accounts issued 25 and 50 pages checkbook. Cash Section In clearing section the work is to clear the cheques, DDs and POs through Bangladesh Bank that are submitted for cash collection. Everyday morning offer another in the evening called return house.In the hose all the Banks congressman sit together and exchanges their money receive instrument of their particular bank to clear the paper and transfer to money the paper p artlcular accounts. Type of Clearing There is two type of clearing 1) In- harbor 2) Out Ward In- ward Those Cheques or instrument of EXIM, which are submitted to other banks for collections are called In Ward Clearing. Out- Ward The cheques of other banks that are submitted to the EXIM for collections are called out-ward Clearing. Cash Section Cash is the main element of all financial activities. The cash section of any branch plays very significant role. Its very sensitive place of the branch, because it deals with most facile assets. The EXIM Bank Mirpur Branch has an equipped cash section.This section receives cash from depositors/Client and pays cash against cheques draft, salary order and pay to slip over the counter This section deals with all type as of negotiable instruments and in includes volt. Used as the store of cash instrument, the main functions of the sections are cash recognize and cash disbursement. Accounts Opening Section This section deals with open of diff erent types of accounts. It is also deals with issuing of books and different deposit boos to the different accounts opener. A customer can open different types of accounts through this department such as l. Current Account 2. Saving Account 3. located deposit account (FDR) 4.Short term Deposit (STD) 5. Monthly saving intention (Money Grover) 6. Monthly income scheme (Steady money) 7. Smart saver Scheme 8. Multi plus saving Account 9. Super saving scheme 10. pedagogics saving scheme EXIM Bank gives special importance various deposit schemes are l. Monthly saving Scheme (money Grower) 2. Monthly income scheme (Steady Money) 3. Multi plus savings A/C 4 Super saving scheme 5. Double benefit Scheme 6. Smart saver Scheme 7. And Education saving Scheme Types of Accounts with Terms and Conditions Current (CD) Account Current account is purely a demand deposit account. There is no restriction on with mountaining money from the account.It is basically justified when funds are to be colle cted and money is to be paying(a) at frequent interval. Some Important Points are as follows- Minimum start deposit of TK. 1000/- is required There is no withdrawal limit. No raise is given upon the deposited money Minimum Tk. 1000/= balance must(prenominal) always maintain all the time. Savings (SB) Account The bank provides savings account services for the ease of its clients. It offers both personal and corporate Savings Account to its clients in every branch. Hence, there is a restriction on withdrawals in a month. Heavy withdrawals are permitted only against front notice. Some Important Points are as follows- Minimum opening deposit of Tk. 5000/= is required Minimum Tk. 1000/= balance must always maintain all the time Withdrawal summation should not be more than 1/4th of the total balance at a time and limit twice in a month. If withdrawal amount exceed 1/4th of the total balance at a time no interest is given upon the deposited money for that month. The current rate on deposit amount is 6%. Closing of saving accounts will cost 300tk to a customer. Short Term Deposit (STD) Account Normally various big companies, organizations, Government Departments keep money in STD account. Frequent withdrawal is discouraged and requires prior(prenominal) notice.The deposit should be kept for at least seven days to get interest. The interest offered for STD is less than that of savings deposit. refer is calculated based on periodical minimum product and paid two times in a year. Interest rate is 4. 50%. Call Deposits (Money at Call) Sometime the banker secures funds from the money markets usually from other bankers against recognize to meet his purely tepmorary shortage of funds. These debts are repayable immediately at call. When the money market is clinched such derosits attract higher rate of interst and then to be treated as bankers borrowings as call loans. Account opening To dill with the bank individuals need to have an account first.The part iculars are prerequisite for identification of the account holders individually so that the banker can discharge his obligations to every one correctly and to the extent due. Documents required for opening account ? Individual / Joint Account 1. Introduction of the account. 2. Two photographs of the signatories duly attest by the introducer. 3. Identity (copy of passport). 4. Joint Declaration Form (For joint a/c only). 5. Employees credentials (in case of service holder). ? confederacy account 1. Introduction of the account. 2. Two photographs of the signatories duly attested by the introducer. 3. Partnership earn duly signed by all partners (Sign should be similar as stated in Partnership Deed). 4. Partnership Deed duly certified byNotary public. 5. Registration (If any). 6. Updated Trade license. ? Proprietorship account 1. Introduction of the account. 2. Two photographs of the signatories duly attested by the introducer. 3. Valid copy of Trade License. 4. Rubber stamp. 5. T IN effect certificate. 6. Identity (Copy of passport). 7. Permission earn from DC/ Magistrate (in case of newspaper) 8. ? Limited company 1. Introduction of the account. 2. Two photographs of the signatories duly attested by the Introducer. 3. Valid copy of Trade License. 4. Board resolution of opening A/C duly certified by the chairperson/Managing Director. 5. Certificate of Incorporation. 6.Certificate of Commencement (In case of Public limited company). 7. dependent (joint stock) true copy of the Memorandum and Article of Association of the Company duly attested by Chairman or Managing Director. 8. List of directors along with appellation & specimen signature. 9. Latest certified copy of Form dozen (to be certified by register of joint stock companies) (In case of Directorship change). 10. Rubber Stamp (Seal with designation of each person) 11. Certificate of enrolment (In case of Insurance Company Obtained from department of Insurance from the Peoples Republic of BD). ? social club / societies account 1. Introduction of the account. 2.Two photographs of the Signatories duly attested by the introducer. 3. Board Resolution for Opening A/C duly certified by President/ Secretary. 4. List of Existing Managing Committee. 5. Registration (if any). 6. Rubber Stamp. 7. Permission letter from Bureau of N. G. O. (In case of N. G. O. A/C). Savings Scheme Monthly Income Scheme Multiplus Savings Smart saver Super Saving Scheme Monthly Savings Scheme (Money Grower) Hajj Scheme Finance/Loans somatic Finance Industrial Finance Lease Finance Hire Purchase Finance Commercial Loans Project Finance Syndicate Loans Retail Loans Mortgage Loans Loan against Share and Securities Account Opening results Step 1 The account should be properly introduced by either one of the following An existing Current Account holder of the Bank. Officials of the Bank not below the rank of an Assistant officer. A respectable person of the neighbourhood well kno wn to the Manager/Sub-Manager of the Branch refer. Step 2 Receiving filled up application in banks prescribed form mentioning what type of account is desired to be opened. Step 3 The form is filled up by the applicant himself / herself Two copies of passport size photographs from individual are taken, in case of firms photographs of all partners are taken Applicants must submit required documents Application must sign specimen signature sheet and give mandate Introducers signature and accounts number substantiate by legal officer Step 4 Authorized Officer accepts the application Step 5 Minimum balance is deposited only cash is accepted Step 6 Account is opened and a Cheque book and pay-in-slip book is given Account Sections Daily function The routine day by day tasks of the accounts department are as follows 1. Recording the daily transactions in the cash book 2. Recording the daily transactions in general and subsidiary ledgers 3. Preparin g the daily position of the branch comprising of deposit and cash 4.Preparing the daily statement of affairs showing all the assists and liability of the branch as per ledger and subsidiary leader separately. 5. Making payment of all expenses of the Branch 6. Recording inters branch fund transfer and providing accounting sermon in this regard. 7. Checking whether all the vouchers are correctly passed to ensure the Conformity with the Activity Report if otherwise making it correct by calling the respective official to rectify the voucher. 8. Recording of the vouchers in the Voucher prove 9. Packing of the correct vouchers harmonise to the debit voucher and the credit voucher. Periodical Tasks The routine periodical tasks performed by the department are as follows. 1. Preparing the monthly salary statements for the employees 2.Publishing the basic data of the branch 3. Preparing the weekly position for the branch this is sent to the manoeuvre Office to maintain Cast Reserve requir ement 4. Preparing the monthly position for the branch, this is sent to the Head office to maintain statuary liquidity requirement. 5. Preparing the weekly position for the branch comprising of the break up of sector wise deposit, credit etc. 6. Preparing the weekly position for the branch comprising of the denomination wise statement of cash in tills. 7. Preparing the budget for the branch by fixing the target regarding profit and deposit so as to take necessary steps to general and mobilize deposit 8.Preparing an Extract which is a compendious of all the transactions of the Head Office account with the branch to reconcile all the transaction held among the accounts of all the branches. General Account General account is important one, which has to be maintained by each branch. and then general account is are record of Oregonian and responding transactions among inter- branches of the same bank. All types of assets and liabilities of one branch with another one are settled throug h this account. Branch can know how much the bank is liable with Head Office. The debit and credit balance shows assets and liabilities of the respective branch. Statement or AffairsAccounts section prepares the statement of affairs for finding the profit/ loss as well as amount of assets and liabilities of concerned branch per day Theoretically, it is called financial statement and has tow parts 1. Income and Expenditure Account 2. Statement of Assets and Liabilities amortisation and Depreciation Amortization is the allocation of the cost of an intangible asset to expense for example, prepaid expenditure, prepaid indemnity and good will etc Amortization schedule is determined by the decision of management. Establishment This section deals with employees salary, much type of internal expenses such as purchase of pen, paper equipment, machinery and payment of labor Cost and employee conveyance. In cause of leave of absence employee collects prescribed from this section. LOANS AND A DVANCES DEPARTMENT IntroductionBanking is essentially a business dealing organization with money and credit like all other business activates. Banks are profit-oriented organization. A bank invites its find many ways to earn more and more profit and most of its income is derived from loans and advances. Bank makes loans and advances to traders, Businesspersons, industrialists and many other persons against security system of some cautions policy and sound lending principle in the matter of lending. EXIM Bank is a lending bank in loans and advances and it grant loans in various sectors especially in industry, trade and commerce. Types of loans and advances There may be different types of loans and advance given from the commercial banks such as EXIM Bank Ltd. Of our country.Loans and advances may be in the following types 1. Cash credit 2. Overdraft 3. House Building loan (General and Staff) 4. loony toons (Car) loan (only for senior staff) 5. Consumer credit Scheme 6. Loan against Imported Merchandise (LIM) 7. Loan Bills purchases Documentary (LBPD) 8. Loan against Other Securities (LAOS) 9. Term Loan Brief Idea about the different types of loans and advance Cash assurance (CC) Cash credit is an governing body by which the customer is allowed to borrow May up to a creation limit. This permanent line of battle and the customers need not to draw the canonical amount of money at a time. The borrower can draw the money when required.The borrower can put back any surplus, amount, which he/she may he affect frequently. Intersect is charged only to the amount with drawn and not he whore amount sanctioned cash credit arrangement is usually divide into two ways such as 1. Cash credit pledge 2. Cash credit hypothecation Cash Credit Pledge In case of cash credit pledge pigheadedness of the goods dealings to bank and ownership of the of the goods belongs to borrower and bank the possessions of the goods as primary security. The goods storied in go down under lock a nd key by direct supervision of the bank. If the borrower wants to sell any potion of the pledged goods he/she permission of bank with returning the value of the loan amount.It is and then regarded as the most secured type of advance. Cash Credit hypothecation In case of cash Credit hypothecation possession of the goods not transferred to the bank and therefore such and advance is no better than a clean loan, such an advance can thus only be disposed(p) to a person in whose justness the barked has full confidence cash credit in the form of Hypothecation is usually accompanied with mortgagee of resolute properties. The pray/ borrower possesses the lock and key of the down. The formality of opening cash Credit There intending cash credit holder should submit the following documents and being fill up properly 1. Stock repot, rend receipt 2. Trade license 3.Up to date income tax clearings certificate 4. Charge documents 5. letter of Continuity 6. letter of arrangement 7. DP (Demand Promissory) note 8. Letter of guarantee 9. Letter lien 10. Limit sanction advice 11. Non-Encumbrance Certificate detect the documents the bank authority prepares a cc proposal from that contains the following information 1. Nature of business 2. Banking with EXIM 3. handing over with CD account by the client 4. Allied deposit with SB/STD account. 5. Number of adjustment (s) how many times the CC holder made his/her Account nil that means debit balance come to to credit balance. 6. Recycling it is ration of total credit summation to the limit.If the ratio is Higher it is better from bankers points of view. 7. resign over in the account 8. By the incasement authority the bank holds the power to encase the FDR the encasement authority at any time in case borrowers failure to repay the loan amount with interest in due time. Based in the above-mentioned information the dealing officer of the loans and advances department prepares recommendation about the prospect of granting the CC loan to the client. Overdraft Overdraft is an arrangement between the banker and the customer by which the letter is allowed to withdraw over his/her credit balance in the current account up to an agreed limit.The borrower is permitted for draw and repays any number of times, provided he total amount overdrawn dose not exceeds the agreed limit. Here the interest is charged only for the amount withdrawn over the limit. Not for the whole amount. Overdraft is divided into tow categories Secured overdraft (SOD) flitting overdraft (TOD) Secured overdraft It is allowed against the full security (i. e. FDR, ICB unit Certificates). Temporary Overdraft It is allowed to the customer for a very short period of time. But EXIM bank deals only secured overdraft. Car Loans This is a special type of loan, which is only provided for the staff of EXIM Bank.Usually AVP and above level officers get this kind facility. This loan is reimbursed on instrument al-Qaeda and repayable after each month. Ho use Building loan (General and Staff) General house building loan is providing into two sectors Generally Staff of course house building loan is paid for the construction of commercial building, and owners etc, procedures for sanctioning house- building loan as follows- Application for sectioning loan Application properly filled up for credit facilities supplied by the bank. Personal net worth statement each director Enquiry form Required papers for sanctioning HB loan Copy of general power of attorney Copy of material certificate Copy of engineers estimate Copy of stick outed cash flow Loan (General) In case of loan the banks sanction some of money for a certain period of time. The enter amount is one time disbursement and paid in cash or credit loan A/C. The interest is charged on full sanctioned amount 16%. The bank generally sanctions loan to establish industry. These types of loan are granted for capital expenditure such as purchase of land, constriction of factory b uilding, purchase of new machinery and modernization of plant. The borrower cannot withdraw this type of loan once repaid in full or in part again. Formalities for extending project loan Loan application formAfter receiving the loan application from the borrower the branch scrutinizes the application whether it is viable or not. Loan application from contains the following particulars amongst other detail below Particular description of the Project. Nature of the Project Detail information about the borrower Statements of assets and liabilities of the borrower with declaration Detail information about proposed products, machinates and manpower etc Project cost and source of fund. Market for the proposed project. Feasibility report This report is provided by the borrower, which includes the following aspects of the project Marketing aspect Technical aspect financial aspect Managing aspect Socio-economic aspect 1) Classification Procedure 1.Categories of Loans- At first all loans and advances will be grouped into four categories for the purpose of classification, such as- (a) uninterrupted Loans (b) Demand Loans (c) Fixed Term Loans and (d) Short Term and Agriculture & Micro Credit. (a) Continuous Loans The loan A/C in which transaction may be made within a certain limit and have an conclusion date for full adjustment will be treated as continuous loan. Exp CC, OD etc. (b) Demand Loans The loan that becomes repayable by the party on demand by his bank will be treated as demand loans. If any contingent or any other liabilities are turned into forced loan will also be treated as demand loan. Exp. LIM, PAD, FBP, IBP etc. (c) Fixed Term Loans The loan which is repayable with in the specific time period under a pacific repayment schedule will be treated as Fixed Term Loans. d) Short Term Agriculture & Micro Credit Short Term Agricultural Credit will be as per list issued by Agricultural Credit and Specialized Programmers Department (ACSPD) of Banglad esh Bank under the Agricultural Credit Programmed. Credit in the Agricultural sector repayable within 1(one) year will also be included herein. Short Term Micro Credit includes any micro credit not exceeding TK. 25,000. 00 and repayable within 12 months. 2) Basis for Loan Classification (A) Objective Criteria (1) Past due/ over due In this point we saw four factors those are a) Any continuous loan if not repaid / renewed within the frozen resultant date for repayment be treated as past due/ overdue from the following day of the expiry date. ny demands loan if not repaid/ rescheduled within the fixed expiry date will be treated as past due/ overdue from the following day of the expiry date. b) In case any initiation of a fixed term loan (repayable within fives) is not repaid within the fixed expiry date, the amount of undischarged installment will be treated as past due/ overdue (defaulted instilment) from the following day of the expiry date of the particular installment. c) Inc ase of any installment or part installment of a Fixed Term Loan (repayable over five years) is not repaid within the fixed expiry date, the amount of unpaid installment will be treated as past due/ overdue after 6(six) months of the expiry date of that particular installment. ) The Short Term Agriculture & Micro Credit if not repaid within the fixed expiry date for repayment will be considered as past due/ over due (defaulted instilment) after 6(six) month of the expiry date. (B) Qualitative Judgment If any uncertainty or doubt arises in respect of recovery of any continuous, Demand or Term Loans the same will have to be classified as Sub- Standard or Doubtful or Bad/ Loss. Considering the merit of the A/C on the basis of qualitative judgment be it classified or not on the basis of objective criteria. The Bank will discriminate on the basis of qualitative judgment and can be- classify loans if qualitative improvement does occur.But if a loan classified by Bangladesh Bank inspection Team, the same can be de- classified with the sycophancy of the Board of Directors of the Banks. CIB Report sooner making credit report to the head office the lending branch takes the credit information to the borrower from the CIB (credit Information Bureau) of Bangladesh Bank and other financial institutions. For obtaining this report the branch sends Inquiry form to CIB duly filled in particulars of the borrower. The report id divided into 5 segments. Project judgement It is the reinvestment analysis done by Banker before a project is approved. Project appraisal in the Banking sector is needed for following reasons To ensue repayment of the Bank finance To achieve the organizational goals To establish industrialists in a country. The main tasks of the project appraisal is to justify the soundness of an investment by the Banker by means of a capital and systematic of the different elements of the Project For this purpose Banks use two types of analysis bestow Risk Analysis (L RA) Spread Sheet Analysis (SSA) Lending take a chance analysis Lending risk analysis is modern methodologies, which describes how to access the risks that are inherent any credit extension and how to access the likeliness that the customer will repay a loan. The LRA form contains 16 pages to analysis different categories of Risks.The Financial Sector Reform project introduces the lending Risk analysis format in 1993. LRA is a standardize format for analyzing the credit worthiness of a borrower and the likeliness that the borrow will repay. Bangladesh bank issued a letter number BCD (p) 611/13/290 dated 17-07-1994, which now makes it mandatory for the commercial Banks to implement the LRA approach to credit analysis prior to extending credit facilities to a Borrower. The modern concept of lending is purpose and production oriented and not security oriented. The emphasis should be given not any security rather on he likelihood of repayment, the credit worthiness of the customer sou ndness and viability of the business etc. Lending PrinciplesThe Principle of lending is a collection of certain accepted time tested standards, which ensure the proper use of Investment fund in a profitable way and its timely recovery. Different authors describe different principles for sound lending. 1. arctic 2. Security 3. Liquidity 4. Adequate yield 5. Diversity Process of Investment Heads Characteristics Application Applicant applies for the Investment in the prescribed form of the bank describing the types and purpose of Investment. Sanction Collecting credit information about the applicant to determine the credit worthiness of the borrower. Sources of information Personal Investigation, Confidential Report from other bank, Head Office/Branch/Chamber of Commerce. CIB (Central Information Bureau) report from Central Bank. Evaluation of compliance with its lending policy. Evaluating the proposed security. LRA is must for the Investment exceeding one crore as ordered by Bangladesh Bank. If everything is in accordance the Investment is sanctioned Documentation Then bank prepare a Investment proposal which contains terms and conditions of Investment for approval of H. O. or Manager. Takes the necessary papers and signatures from borrower Disbursement An Investment Account is opened. Where customer A/CDr. respective(prenominal) Investment A/C -Cr. FOREIGN EXCHANGE DEPARTMENT Introduction One of the largest businesses carried out by the commercial bank is foreign trading. The trade among various countries fills for close link between the parties dealing in trade. The situation calls for expertise in the field of foreign exchange operations. The bank, which provides such operations refereed to as rending international Banking operation. Mainly trisections with overseas countries are respects of import, export and foreign remittance come under the preview of foreign exchange transaction, and international trade demands a flow of g oods from seller to buyer of payment from buyer to seller.In this case the Bank plays a vital role to bridge between the buyer and seller. Foreign Exchange Mechanism in Flow Chart Sales/Purchase contract Issues L/C Forward Forward documents Makes payment Makes payment Foreign Exchange department of EXIM Bank is department of all departments. This department handles various types of activates by three separate sections 1. Import Section 2. Export section 3. Foreign Remittance. Import Section The functions are of the section is mainly to deal with various components such as Letter of Credit (L/C) Payment against Document (PAD) Payment against Trust Receipt (PTR) Loan against Imported Merchandise (LIM) Letter of Credit (L/C) DefinitionA letter of credit can be defined as an arrangement where in a Bank Guarantee on behalf of these customers to make payments to the beneficiary upon presentation of documents specified in the credit. Parties involved in L/C Opener/ Buyer/Importer The p erson who opens the L/C is known as opener/ buyer/importer of the L/C. The buyer and the seller conclude a sales contract providing for payment by documentary credit. 0pening Bank The Bank issuing the L/C in favor of exporter is known as opening Bank. The opening bank opens L/C on request of importer according to application of the importer. Advising Bank The Bank through L/C is advised their agent (correspondent Bank) abroad.The duty of the advising Bank is to authenticate the message so that is to the seller can act on it without any fear of counterfeit etc. Beneficiary Seller and exporter in whose favor the L/C are opened. The beneficiary is normally the seller of good who receive payment under documentary credit. If has compiled with terms and conditions thereof. Negotiating Bank The Bank that is authorized to handle (purchase) the documents under the L/C in the exporting country is known as negotiating Bank. L/C will stipulate either a notified bank to negotiate (restricted L/ C) or any bank can negotiate in the sellers country (unrestricted L/C). Reimbursing Bank The Bank that is (by the L/C issuing Bank) to effect reimbursement is known as reimbursing bank.Reimbursing Bank authorized to honor the reimbursement claims in settlement of negotiation/ accepting/ payments lodged with its by the paying/ negotiating/ accepting Bank. corroborative Bank A Confirming Bank is one which adds the guarantee to the credit opened by another bank. Therese undertaking the responsibility of payment/ negotiating/ acceptance under the credit in addition to that of the issuing Bank. A confirming Bank normally does so it requested by the issuing Bank. Types of L/C Revocable/ irrevocable L/C Confirmed/ unconfirmed L/C. Transferable L/C Back to back L/C Acceptance L/C Revolving L/C Red clause L/C unfledged close L/C The EXIM Bank basically deals with irrevocable L/c. which can not be amended or cancelled by the issuing Bank at any moment and without prior to the benefi ciary.It also deals back to back L/C, which is the letter of credit, provided by the exporter to the import the raw materials from abroad in order to produce the exportable commodity for the importer. Procedures for opening L/C Application for opening L/C An importer who is desirous to import goods from foreign country will apply Issuing Bank for opening a L/C. The importer will provide an application mentioning the following aspects 0 Full particulars of applications Bank account. 0 Types of business 0 Historical background 0 Amount of required L/C limit 0 Amount of L/C margin. 0 Term of payment 0 Name of imported goods 0 Repayment schedule and source of fund Document schedule and source of fund.An importer or L/C opener has to submit the following documents 0 Application from (provided by the Bank) 0 Import registration certificate 0 Pro-forma invoice 0 Four sets of IMP from 0 Insurance cover not 0 VAT registration number 0 Tex registration number 0 Letter of credit authorization form Examination for opening L/C Application must be cautiously checked by the concerned officer considering the facts mentioning below ? The terms and conditions of L/C applications are ordered with exchange control and import trade resolution UCPDC 500. ?Illegibility of imported goods ?The L/C must be opened in favor of importer ?That is signed by the importer and agreed with the terms and conditions. Indenting registration number ?Goods are not of Israel and vassals to be used are not of Israel ? Insurance cover note with date of shipment. ?Whether RC is up to date or not ?Whether IMP form is duly filled up and singed ?The imported goods are marketable After scrutinizing all thee legal aspects necessary entry is given to the margin register and charge, citizens committee and margin in realized. Transmitting the L/C The L/C is transmitted to the advising Bank for advising the L/C to he beneficiary. L/C is generally transmitted through tested Telex of Fax. Before transmission of f inal examination of the L/C contents is