Beruflich Dokumente
Kultur Dokumente
on
An Analysis of Financial Performance of BRAC Bank Ltd
Supervised By:
Sk. Habibur Rahaman
Senior Lecturer
Manarat International University
Prepared by:
Al Sukran
ID-1413MBA50346
Manarat International University
Internship Report
on
An Analysis of Financial Performance of BRAC Bank Ltd
Supervised By:
Sk. Habibur Rahaman
Senior Lecturer
Manarat International University
Signature of Supervisor
Prepared by:
Al Sukran
ID-1413MBA50346
Manarat International University
DECLARATION
I do hereby solemnly declare that the work presented in this Internship Report has been
carried out by me and has not been previously submitted to any other University College /
Organization for an academic qualification / certificate / diploma or degree.
The work I have presented does not breach any existing copyright and no portion of this
report is copied from any work done earlier for a degree or otherwise.
I further undertake to indemnify the Department against any loss damage arising from breach
of the foregoing obligations.
. .
Al Sukran
ID-1413MBA50346
Department of Business Administration
Manarat International University
SUPERVISORS CERTIFICATE
This is to certify that the Internship Report on An Analysis of Financial Performance of
BRAC Bank Ltd in the bona-fide record at the report is done by AL SUKRAN
bearing
The report has been prepared under my guidance and is a record of bona fide work carried
out successfully.
ACKNOWLEDGEMENT
First of all, I would like to express my deep gratitude to the Almighty Allah for fruitfully
preparing this Internship report.
I uttered a wholehearted thankfulness to my supervisor Sk. Habibur Rahaman, Senior
Lecturer, Department of Business Administration, Manarat International University (MIU)
who has given me the opportunity and directions to prepare such a meaningful thesis paper. I
am so satisfied to work under her supervision and care. Also it would be rather incomplete
without express thanks my Internal and External Supervisions again & again.
It is my pleasure to them and my grateful appreciation goes to BRAC BANK LTDs authority
for rendering me their expertise, knowledge and giving me the opportunity of having a
practical experience through this internship program.
I would like to show my gratitude towards MD. Enamul Haque, Manager of Pallabi SME
Branch, Md. Murad Hossain, Unit office of Pallabi SME Branch & all the staff of Brac Bank
Ltd, Pallabi SME Branch who co-operate with me friendly. They have explained everything I
asked for in details. Throughout time they were never impatience. They did not allow me to
feel uncomfortable for even a single moment. I am really grateful to all for their supportive
and friendly behavior.
EXECUTIVE SUMMARY
TABLE OF CONTENTS
Contents
Cover Page
Title page
Letter of Transmittal
Declaration
Supervisors Certificate
Acknowledgement
Executive Summary
Table of Contents
Page
i
ii
iii
iv
v
vi
Chapter 1
Introduction
1.1 Background of the Study
1.2 Scope of the Study
1.3 Objectives of the Study
1.4 Methodology of the Study
1.5 Instruments used for analysis
1.6 Limitations of the Study
1
1
2
2
3
4
Chapter 2
5
6
7
8
9
9
10
11
12
Chapter 3
Analysis and Findings
3.1 Definition of Financial Ratio Analysis
3.2 Different Types of Ratio Analysis
3.3 Ratio Analysis of BRAC BANK LTD.
3.3.01 Current ratio
3.3.02 Operating Cash Flow Ratio
3.3.03 Cost Income Ratio
15
15
17
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36-40
CHAPTER 1
Introduction
1.1 Background of the Study
This is a report on my internship at BRAC BANK LTD this report details my experiences at
the company.
The internship and this report are part of my MBA requirements for the ACCOUNTING at
major at Manarat International University. As an accounting student I have to work with
accounting related topic. I discuss about An Analysis of Financial Performance of BRAC
Bank Ltd. So I analysis some data base on different ratio analysis.
Primary Sources.
Secondary Sources.
Primary Sources: Basically this type of Sources included working at bank and interviews
with others the bankers of BRAC BANK LTD.
Secondary Sources: Secondary data were collected in the following ways:
Internet sources.
General reports
Annual reports
Official documents
Liquidity Ratio.
Activity Ratio.
Debt Ratio.
Profitability Ratio.
Time Limitation: To complete the study, time was limited. It was really very short
time to know details about an organization like BRAC Bank Ltd.
Inadequate Data: Lack of available information about export & import business
operations of National Bank Ltd. Because of the unwillingness of the busy key
persons, necessary data collection became hard. The employees are extremely busy to
perform their duty.
Lack of Record: Large-scale research was not possible due to constrains and
restrictions posed by the organization. Unavailability of sufficient written documents
as required making a comprehensive study. In many cases up-to-date information was
not available.
CHAPTER 2
BRAC Bank is owned partially by BRAC, the largest non-government organization in the
world, International Finance Corporation (IFC), the private sector arm of The World Bank
Group, and Shore Cap International. The head office of the bank is situated at Gulshan,
Dhaka. BRAC Bank Ltd is operating its business in whole Bangladesh. BRAC Bank is
expanding its branch network rapidly throughout the country.
Currently, BRAC Bank Ltd has 157 Branches, more than 300 ATMs and 458 SME Unit
offices across the country. It has disbursed over BDT 10,000 crores of SME loan and has
over 500,000 individual customers who access online banking facilities. Its services cuts
across all strata of clientele are it corporate, retail or SME.
BRAC Bank LTD provides all sort of banking service to the mass people of Bangladesh.
Among them, BRAC Bank is well known for its SME Banking in Bangladesh.
Total Shares
316,598,451
38,002,483
7,020
7,020
5,872
5,872
4,825
5,872
5,341
5,872
354,638,693
709,287,321
% of Total Share
44.64
5.36
0.001
0.001
0.001
0.001
0.001
0.001
0.001
0.001
50.00
100.00
As on 04.06.2013
Nihad Kabir
Director (Independent)
Zahida Ispahani
Director
bKash
bKash Limited (a subsidiary of BRAC Bank) operates with an objective to
ensure access to a broader range of financial services (mobile fund transfer
facility) for the people of Bangladesh. It has a special focus to serve the low
income masses of the country to achieve broader financial inclusion by
providing services that are convenient, affordable and reliable.
and services
Manage various lines of business in a full controlled environment with no
Retail Banking:
Retail Banking is known as general banking where the individual customers get services time
to time from the local branches of the larger commercial banks. In BRAC Bank Retail
section has been divided into four parts
They are interdependent and work closely with each other. Retail offers different types of
competitive banking products to the customers. The retail division of the BRAC Bank also
offers some special types of deposits and loan scheme for the customer attention.
Corporate Banking:
Corporate department has also two different wings Corporate Banking division & Cash
Management. Corporate Banking is a specialized area of BRAC Bank, which addresses the
diverse financial needs of Corporate Clients. This division exists to provide banking services
and financial partnership with local and foreign business houses (Public and Private Limited
Companies),
NGOs,
trading
houses,
joint
ventures
and
various
government
bodies/corporations etc. As the financial partner of choice for the corporate sector, BRAC
Bank wants to be distinguished by its:
Quality of service
Value of innovative solutions
Level of trust with clients
Customer knowledge
Probashi Banking:
This offers an array of products and services that are targeted towards the nonresident
Bangladeshis living in different parts of the world, a milestone for BRAC bank as to
becoming the pioneer in such operation. The official launching of Probashi Subidha Account
took place on 16 January 2007 with a prospective to catering the beneficiaries of NRB
customers with their different banking needs.
With a goal to provide fast and expeditious services to deliver remittances even in the most
remote corner of Bangladesh, the network of electronically connected field offices have been
expanded more than 1200 BDP outlets across the country for remittance payment. In 2007
the remittance services has turned out to be one of the core business areas of the Bank. The
year remained as a rewarding and successful one in terms of new tie-ups and partnerships
with a focus on pursuing unexplored and niche markets around the world.
Other Function
Apart from these five business units, BBL has other support units, which provide the
functional assistance to smoothly run the business. These are:
Card
Treasury & Financial Institutions
Central Operations
Enterprise Risk Management
Financial Administration
General Infrastructure Services
Credit
Consumer Service Delivery (CSD)
Impaired Assets Management
Information Technology
Human Resources
Marketing & Corporate Affairs
Company Secretariat
Chapter 3
Analysis and Findings
3.1 Definition of Financial Ratio Analysis
2010
Current Asset
Current Liability
Current Ratio
2011
2012
108,791,3
42,196
120,691,016
,472
95,407,908,332
107,837,411,843
1.
12
1.14
2013
157,898
,600,871
144,202,510,13
6
1.09
157,010,788
,637
139,510,917
,707
1.
13
Current Ratio
1.16
1.14
1.14
1.13
1.12
1.12
1.09
1.1
1.08
1.06
2010
2011
2012
2013
2010
2011
2012
(1,439,2
05,626)
933,830,374
95,407,908,332
-0.02
2013
107,837,411,843
19,855
,243,700
144,202,510,13
6
(5,679,858,
459)
139,510,917
,707
0.01
0.14
-0.04
0.15
0.1
0.05
-0.02
0
2010
0.01
2011
-0.04
2012
2013
-0.05
2010
2011
9,527,52
7,784
4,751,30
9,242
0.50
2012
10,134,733,
422
5,164,822,
269
0
.51
2013
10,894,8
01,767
5,749,6
05,759
12,460,835,
400
6,535,958,
634
0
.52
0.53
0.54
0.52
0.53
0.52
0.51
0.51
0.50
0.50
0.49
0.48
2010
2011
2012
2013
2010
2011
9,527,527,78
4
117,297,555,74
8
0.0
8
2012
10,134,733,422
133,201,048,438
0.08
2013
10,894,801,76
7
173,676,792,02
9
0.0
6
12,460,835,400
171,901,669,638
0.08
0.08
0.08
0.06
0.07
0.06
0.04
0.02
0
2010
2011
2012
2013
Interpretation
The banks total asset turnover ratio fluctuates from .06 to .08. We know the greater the total
asset turnover; it is more efficient. In year 2010 & 2011 Total asset turnover was 0.08 but in
2012 it became 0.06 but in 2013 BBL able to increase their Total asset turnover ratio at 0.07.
We can tell that total asset turnover is very good and the percentage of it does not movie so
much.
0.07
2010
2011
12,855,98
5,261
88,157,90
8,331
Total Investment
Total Deposit
Investment to Deposit Ratio
0.15
2012
14,198,827,5
11
103,725,529,2
25
0.
14
2013
25,372,525,2
82
134,646,448,482.0
00
0.
19
21,298,625,6
61
124,746,344,0
37
0.
17
0.19
0.08
0.14
2010
2011
0.17
0.15
0.1
0.05
0
2012
2013
2010
2011
2012
2013
Total Asset
107,879,663
,647
117,297,555,
748
123,598,443,6
00
133,201,048,4
38
163,522,243,4
77
173,676,792,0
29
160,314,216,1
68
171,901,669,6
38
Debt ratio
0.92
0.93
0.94
0.93
Total Liabilities
Debt Ratio
0.95
0.94
0.94
0.93
0.93
0.92
0.92
0.91
0.94
0.93
0.93
0.92
2010
2011
2012
2013
2010
2011
4,956,21
8,541
1,984,71
1,371
2.50
2012
5,164,822,2
69
2,053,030,0
38
2.
52
2013
5,145,196,0
08
1,987,929,1
20
2.
59
5,924,876,7
66
2,900,072,5
24
2.
04
2.52
2.59
2011
2012
2.04
2.5
2
1.5
1
0.5
0
2010
2013
2010
2011
1,670,36
1,526
9,527,52
7,784
0.18
2012
1,702,381,8
69
10,134,733,4
22
0.
17
2013
540,381,0
91
10,894,801,7
67
0.
05
1,246,324,1
01
12,460,835,4
00
0.
10
0.18
0.17
0.10
0.15
0.1
0.18
0.05
0.17
0.05
0
0.05
2010
2011
2012
0.1
2013
Interpretation
In the year 2010 & 2011 BBLs net profit margin is good. But in 2012 BBLs net profit
margin decrease too much because of but situation of recession period of time. But in 2013
BBLs increase their net profit margin at 0.10. This is very good operating result of the bank.
2010
2011
Return on Asset
(ROA)
1.55%
1.36%
2012
2013
0.35%
0.72%
Return on Asset
2.00%
1.55%
1.36%
1.50%
0.72%
1.00%
0.35%
0.50%
0.00%
2010
2011
2012
2013
2010
2011
Return on Equity
18.95%
17.90%
2012
2013
5.47%
11.46%
18.95%
20.00%
Return on Equity
17.90%
11.46%
15.00%
5.47%
10.00%
5.00%
0.00%
2010
2011
2012
2013
2010
2011
5.68
5.54
2012
2013
1.52
3.20
5.68
3.20
4
3
1.52
2
1
0
2010
2011
2012
2013
Cost of Fund
Year
2010
Cost of Fund
2011
8.54%
2012
8.66%
2013
8.43%
8.13%
Cost of Fund
8.80%
8.54%
8.66%
8.43%
8.60%
8.40%
8.13%
8.20%
8.00%
7.80%
2010
2011
2012
2013
Interpretation
The BBLs Average Cost of Fund is around 8.00% which is really good for a bank industry
maintain their cost of fund.
2010
2011
95.63%
2012
84.82%
2013
76.96%
82.30%
95.63%
100.00%
84.82%
76.96%
82.30%
2011
2012
2013
80.00%
60.00%
40.00%
20.00%
0.00%
2010
2010
Return on Investment
2011
9.00%
2012
12.41%
2013
3.44%
6.05%
Return on Investment
14.00%
12.00%
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
12.41%
9.00%
3.44%
2010
2011
2012
6.05%
2013
2010
2011
33.29
2012
28.80
2013
26.34
26.14
33.29
2010
28.80
26.34
2011
2012
26.14
2013
Fig
3.4 Findings:
In the analysis it has seen that in 2010 BBLs current ratio was highest and 2012 it
was lowest among the years. It has seen that BBL maintains current ratio more than
1:1 ratios. It indicates that BBLs liquidity position is not bad.
In 2010 BBLs Cost Income Ratio was lowest it indicates positive sign. We know that
the lowest the ratio, the higher the operating efficiency. But company maintains an
average around .50 per year.
The greater the total asset turnover; it considered more efficiency. From the analysis it
has seen that in year 2010 to 2012 total asset turnover ratio of BBL decreasing but at
2013 its higher than previous which indicate better efficiency of BBL.
BBLs investment to deposit ratio is decreasing in years 2010 to 2011 which conveys
negative signal for the bank. But in 2012 its again increasing. Company maintains an
average Investment to deposit ratio around 0.16.
From the analysis it has seen that BBLs debt ratios were satisfactory range in
From the analysis it has seen that BBLs Returns on Asset were gradually decreasing
and in 2010 to 2012. But its improved from 2012 to 2013.
From the analysis return on equity of BBLs was around 18% in 2010 and 2011. In
2012 because of recession and bad market position Return on Equity reduced
unbelievably at 5.47%. But in 2013 BBLs able to increase their ROE at 11.46%.
From the analysis we found that earnings per share is 5.50 in 2010 & 2011 But in
2012 EPS was decrease at 1.52 and in 2013 again BBLs EPS remain increase.
From analysis Net Asset Value Per Share of BBLs was 33.29 in 2010. But it is
decreasing year by year. But it maintains an average 26.00 last two years
Chapter 4
Recommendations & Conclusion
4.1 Recommendations:
It is seen in the study that the liquidity ratio of B.B.L during 2012 & 2013. The
liquidity of the bank should be reds by improving current & quick ratio. But company
should maintain this properly and has to improve.
It is further seen that the loan to deposit ratio of the bank was lower during 2012 &
2013. Therefore the loan to deposit ratio must be improve by increasing need loan.
Assets utilization ratio was also lower in 2011 & 2012. In case B.B.L. This ratio
should also be increased by increasing operating income.
Finally, at the end of the year we can see that although there have some difficulties
but we can overcome those difficulties by removing all the weaknesses to develop the
product effectively and grab more opportunity hidden in the banking industry and the
bank should also increase the strength with their solid brand image, experience and
skills of the employees. With their strengths BRAC BANK LTD. can also reduce the
threats existing in the market.
4.2 Conclusion
Banking sector is the chief financial intermediaries in a country. Its also true for Bangladesh.
BRAC BANK LTD is a very challenging institution. In the age of globalization and free
trade, the process and the system of running a bank is changing. BBL is continuously
managing itself with this changing environment. The days are gone for banks to keep their
functions confined within the periphery of accepting deposit and lending money as well as
making a profit. The company strategies are clear and concise. The return is pretty good. If
the company performs this way, we can expect that in near future BBL may become one of
the top performer in banking sector of our country. They are also able to contribute to our
economy in better way. The working environment of the bank is impressive. It was also
found that the bank is doing better in most of the sectors and their performance is better than
average.
Finally it can be said that the bank is doing very good in the competitive market and if it can
continue to perform this way it can become a leading banking institution which can play a
pivotal role in the development of the country.
To cope up with the new millenniums electronic banking, bank should reinvent and redesign
itself for customer satisfaction. Some recommendations may be put forward in this regard.
The bank should launch some new products as automatic teller machine, money link, Tele
bank for better customer service.
References
Books:
Weygandt, Kieso, & Kimmel; Managerial Accounting; 11th Edition; Wiley Global
Education, 2011
Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel; Principle Accounting; 7th
Edition; Wiley, 2005
Annual Report
Websites:
http://www.bracbank.com
http://www.wikipedia.org
www.investopedia.com
www.google.com
www.accountingcoach.com
Appendix