Beruflich Dokumente
Kultur Dokumente
OF
AGRANI BANK LIMITED
SUPERVISED BY:
Nigar Sultana
Senior Lecturer
Stamford University Bangladesh
Department of Business Administration
SUBMITTED BY:
Abrar Amin
ID: BBA-05015664
Batch: 50(D)
Major: Accounting
Dear Madam,
It is my pleasure to submit my internship report titled as Foreign exchange
Activities of Agrani Bank Limited which I was assigned by you as a part of
Internship program for the completeness of Bachelor degree of BBA Department
in Stamford University Bangladesh. It is a pleasure to work at Agrani Bank for the
period of three months I was placed in the Sales and service department from
August1st 2016 at Hatkhola Branch, Dhaka.
It is a worthwhile experience and learning area for me to build up my career in the
banking sector. This experience will help me to develop professionalism and has
given me the chance to know about the overall banking activities as well as
created a positive attitude towards the business world. I have tried my level best to
gather information that according to my belief is relevant and resourceful. It was a
great opportunity for me to apply some theoretical knowledge in the practical
purpose. I have also tried my best to give some suggestions for the betterment of
the sales and service centre in the customer service department and I hope that I
was being able to satisfy their needs through my work.
It will be a pleasure to clarify if anything is necessary regarding this report and I
thank you for allowing me the opportunity to undertake this task with your sincere
guidance and cooperation. I express my acknowledgement and gratitude for
assigning me to such a special study.
Your most obedient student,
.............
Abrar Amin
ID: BBA-05015664
Department of Business Administration
Stamford University Bangladesh.
Certificate
This is certified that the Internship report on the Foreign exchange Activities
of Agrani Bank Limited is submitted for the award of the degree of Bachelor
of Business Administration in Accounting to the Stamford University
Bangladesh is an authentic research carried out by Abrar Amin under my
supervision.
He is permitted to submit the Internship report & I wish him every success in
life.
.
Nigar Sultana
(Internship Supervisor)
Senior Lecturer
Department of Business Administration
Stamford University Bangladesh.
Declaration
No part of this report has been submitted by me for any degree, diploma, title
or recognition before.
.
Name: Abrar Amin
ID No: BBA-05015664
Batch No: 50(D)
Major: Accounting
Department of Business Administration
Stamford University Bangladesh
PREFACE
Internship is the integral and basic requirement of all business study programs.
Because it is the practical implication of theoretical knowledge which we have
been taught in our business subjects to gain further knowledge and experience
about professional business activities.
It equips us with the necessary knowledge, skills and values of business culture
which are basic requirement of the business professional and which also helps
new graduates students to perform professionally as they get first step in their
professional life.
For this reason I was placed at Agrani Bank Limited, Hatkhola Branch Dhaka
where I have done my three months Internship. During my three months
Internship period I have gained a lot of knowledge about banking operations under
the supervision and guidance of my Internship supervisors.
During my whole duration I was rotated in all the different areas of the branch and
was thoroughly briefed about the procedure of all the banking operations by the
concerned staff. This report that I have prepared on the Foreign exchange
Activities of Agrani Bank Limited was initiated as part of the Internship Program.
My Internship report contains all the knowledge which I have learnt there.
ACKNOWLEDGEMENT
A report book of thesis paper requires a lot of information from various sources
and to make such kind of report needs a lot of assistance. So to prepare a report by
collecting data of various kinds has to be done by depending upon many people.
So, I did also depend upon others to collect all the relevant information and data
on the performance of relative fields.
First of all I would like to put across my gratitude to MR. Khalekur Jaman
Managing Director of Agrani Bank Limited, for authorizing me to complete the
task and let me know all those information for which I was being able to prepare
this report according to the requirement. I have also talked to the concerned
officers of Agrani Bank Limited, Hatkhola Branch who kindly provide me
information relating to the task. Mr. X SVP,Mr. X AVP,MR.x AVP,MD Md.
SEO.Azizur Rahman,E.O,Mr X E.O MR Ahsan Ahmed Officer, MR X Hatkhola
Branch Manager they all helped in a productive manner from all aspects. I am
also thankful to the Manager, General Manager, and Assistant General Manager
for their limitless cooperation and supervision. I also express a deep debt of
appreciation to the employees of Agrani Bank Limited, Hatkhola Branch.
I uttered a wholehearted thankfulness to my supervisor Nigar Sultana (Senior
Lecture), Department of Business Administration, Stamford University
Bangladesh who has given me the opportunity and directions to prepare such a
meaningful thesis paper. I am also satisfied to work under her supervision and
care.
Also it would be rather incomplete without expressing thanks to the internal and
external supervisors again and again.
Then I also would like to thank x an senior student of our Stamford University in
the Department of BBA of the 43rd batch who also helped me a lot by providing
me with accurate and resourceful Information according to my topic which was
greatly needed in preparing this report.
Lastly, and most importantly I express my immense gratefulness to Almighty
Allah, the creator and merciful who has given me the strength, wisdom patience,
courage and endurance to complete this report successfully in time.
EXECUTIVE SUMMARY
Acronyms
1)
2)
3)
4)
A/C : Account
AD : Authorized Dealer
BB : Bangladesh Bank
B/L : Bill of Lading
LIST OF TABLES
SERIAL NO.
TITLE OF TABLES
PAGE NO
II
TITLE OF GRAPHS
PAGE NO
III
TITLE OF THE TOPIC: FOREIGN EXCHANGE ACTIVITIES
OF
AGRANI BANK LIMITED
TABLE OF CONTENTS
CHAPTERS
PAGES
CHAPTER-1
INTRODUCTION (GENERAL OVERVIEW):
1.1 Background of the study
1.2 Objectives of the study .
1.3 Mythology of the study
1.3.1:Primary Sources..
1.3.2: Secondary sources .
1.4 Scope of the Study .
1.5 Limitations of the Study
1.6 Management and Organizational structure of Agrani Bank Ltd
1.7 Agrani Bank at a glance
CHAPTER-2
(AN OVERVIEW OF BANKING SECTOR IN BANGLADESH):
2.1 Definition of Bank.
2.2 Objective of Bank.
2.3 Historical Background of Banking Institution of Bangladesh..
(According to World Banking Perspective of Bangladesh-1972)
A list of Banking Institutions of Bangladesh.
2.4 Banking Operation in Bangladesh
2.5 Foreign Exchange operations of Banking in Bangladesh.
CHAPTERS
PAGES
CHAPTER-3
(LITERATURE REVIEW):
CHAPTERS
PAGES
CHAPTER-4
(AN OVERVIEW OF AGRANI BANK LIMITED):
4.1 Historical Background of Agrani Bank Ltd
4.2 Board of Directors of Agrani Bank Ltd
PAGES
CHAPTER-5
AN FOCUS ON FOREIGN EXCHANGE ACTIVITIES OF AGRANI BANK:
(ASSESSMENT OF THE REPORT & LEARNINGS THROUGH TASK)
5.1 Definition of Foreign of Foreign Exchange
5.2 Contents of Foreign Exchange
5.3 Objectives of Foreign Exchange
5.4 processes of Foreign Exchange Operations
CHAPTER-6
PERFORMANCE EVALUATION OF AGRANI BANK LIMITED:
(THROUGH ANALYSIS & FINDINGS)
6.1 Analysis of Foreign Exchange activities of Agrani Bank
6.2 Different Analysis to evaluate Agrani Banks Performance: .
o SOWT Analysis
o Ratio Analysis
o BCG Growth Matrix
(With Graphical Presentation)
6.3 Findings and Discussion from Learning
CHAPTER-7
RECOMMENDATION AND CONCLUSION:
7.1 Recommendations to Improve Overall Banks Performance
and Foreign Exchange Operations of ABL
7.2 Conclusion
Bibliographies and References:
CHAPTER-1
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
This report is prepared in order to complete the bachelor degree of BBA in the
Department of Business Administration of Stamford University Bangladesh.
In this report, I have tried to furnish all sorts of practical dealings that are conducted in
case of handling various types of activities in Foreign Exchange Operation, the theoretical
aspects, that is what should be the procedures and requirements maintained from first to
last, and actual practices as well as the ultimate gain for the bank in conducting financial
activities are mainly discussed here to assess overall dealings of the Agrani Bank Limited.
So the purpose and objective of this report can be summarized as follows:
1)
2)
3)
4)
5)
Data sources:
Collections of facts are generally treated as data. There are two types of data from which I
have collected information to prepare this report.
Data collected by two ways that is,
1.3.1. Primary Sources:
The primary Data are those which are collected for the first time and this happen to be
original in character.
Sources of Primary Data:
o
o
o
o
o
CHAPTER-2
Because the resolution regime grants the Bank powers to affect the property rights of
shareholders, creditors and counterparties, the Act sets out the objectives which the Bank must
have regard to when resolving a firm. These are to:
ensure the continuity of banking services in the United Kingdom and of critical functions;
protect and enhance the stability of the financial system of the United Kingdom;
protect and enhance public confidence in the stability of the financial system of the
United Kingdom;
The Bank must consider each of these objectives when choosing which tools to use and in
resolving a firm, but they are not ranked in any particular order.
S.L. NO.
1.
Private Commercial
Banks
Brack Bank Limited
Foreign Commercial
Banks
Citi Bank
Specialised
Development Banks
Karmashanstan Bank
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
HSBC Bank
Standard Chartered Bank
Commercial Bank of
(Ceylon)
State Bank of India
Habib Bank
National Bank of Pakistan
Woori Bank
Bank Alfalah
Rupali Bank
Agrani Bank
Commercial banks have to make decisions about the amount of capital they need to hold
for three reasons. First, bank capital helps bank failure, a situation in which the bank
cannot satisfy its obligations to pay its depositors and other creditors and so goes out of
business. Second the amount of capital affects returns for the owners of the bank.. And
third, a minimum amount of bank capital(bank capital requirements)is required by
regulatory authorities.
2. Asset and liability Management:
Asset management involves a commercial bank in acquisition of assets that have a low
rate of default and diversification of asset holdings to increase profit. On the other hand,
liability management means acquisition of funds at low cost to increase profits. Prudent
management of funds has been the underlying principle of Bank Asias operations. This
bank is almost balanced in managing asset and liability portfolios. The bank has increased
its deposits to tk.18, 500 million in 2005 from tk.13,471 million in the previous year. The
Loans and advances during the period increased to tk.17,870 million in 2005 from
tk.11,861 in the previous year.
3. Liquidity Management:
A commercial bank makes decision to maintain sufficient liquid assets to meet the banks/
obligation to depositors. The Bank has an Asset Liability Committee (ALCO) which is
responsible for managing short-term and long-term liquidity and ensuring that the Bank
has adequate liquidity at all times at optimal funding cost. ALCO reviews liquidity
requirement of the Bank, the maturity of assets and liabilities, deposit and lending pricing
strategy and the liquidity contingency plan. The Asset Liability Committee also monitors
Balance Sheet risk. The Balance Sheet risk is defined as potential changes in earnings due
to change in rate of interest, exchange rates, which are not of trading nature.
4. Treasury Operations:
Bank of Bangladesh has been participating in the local money market as well as foreign
currency market in a prudent way. The Banks investment treasury bills and other
securities is tk.2257 million. An amount of tk.1104 million was placed at call and short
notice as of end 2005 against previous years 990 million.
5. Internal Control:
The internal control system of the bank is designed to ensure that all the units operate
within rules set by the regulatory authorities and Banks own policies and regulations.
Measures are taken to ensure that ethical standards are maintained, accounting rules and
procedures are observed, and efficiency in business process and safeguarding of assets are
ensured. the Stelar Banking Software sets the periphery within which department heads
and branch managers can operate. In line with our objective towards prevention of money
laundering all the relevant departments are instructed to be vigilant, to prevent such
activities, and regular workshops are held in this regard.
6. Risk management:
Bangladesh Bank believes that risk is an integral part of its business and the main role of
their risk management principle is to find the optimal balance between risk and return.
Bangladesh Bank has undertaken a project to install a Core Risk Management System in
every bank. They are in the process of installing the same in respect to Asset liability
Management, Credit Risk management, Foreign exchange risk management, internal
control and compliance and Anti money laundering. The Bank also controls asset
allocation through limiting exposure to industry sector and setting client limit. Maturity
grouping of asset and liability is also monitored to ensure that the banks portfolio remain
within acceptable risk. The business intelligence reports generated by Stelar Software
allow better and more effective monitoring of loan portfolio than before.
Types of risks associated with banking operations are shown below:
A) Credit Risk:
Credit risk is one of the major risks faced by the Bank. This can be described as potential
loss arising from the failure of a counter party to perform with agreed terms with the
Bank. To assess and to mitigate the credit risk, the management has implemented CRM
manual, which is considered an important tool for retaining the assets quality performing.
Therefore, Banks credit risk management functions have been designed to address all
these issues including risk arises from global changes. The Bank has segregated duties of
the officers/ executives engaged in the credit related activities. A separate department has
been formed at Corporate Office which is entrusted with the tasks of maintaining
effective relationship with the customers, marketing of credit products, exploring new
business opportunities, etc. Moreover, credit approval, administration, monitoring and
recovery functions have been segregated. For this purpose, three separate units have been
formed within the Credit Department. These are (i) Credit Risk Management Unit, (ii)
Credit Administration Unit and (iii) Credit Monitoring and Recovery Unit.
B) Foreign Exchange Risk:
Foreign exchange risk is defined as the potential change in earnings arising due to
unfavorable change in exchange rates. The foreign exchange risk of the Bank is minimal
as all the transactions are carried out on behalf of the customers against L/C commitments
and other remittance requirements. No speculative dealing on Banks account was
conducted during the year. Treasury front office conducts deal for commercial purpose
and back office of treasury keeps record and pass entries in books of account. The main
risks in treasury and foreign exchange are exchange rates risk, fund management and
liquidity risk. As per Bangladesh Banks guidelines, the Treasury Department was
operationally and physically divided into front office and back office to mitigate the risk.
Separate telephone and fax lines were installed at the dealing room to meet Bangladesh
Banks guidelines.
C) Money Laundering Risk:
Money laundering risk is defined as the loss of reputation and expenses incurred as
penalty for being negligent in prevention of money laundering. For mitigating the risks,
the Bank has nominated a Chief Compliance Officer at Corporate Office and Branch
Compliance Officers at branches, who independently review the transactions in the
accounts to verify suspicious transactions. Know Your Customer (KYC) policy and
Transaction Profile (TP) format has been introduced. The regulatory requirements are
being complied with and the guidelines in respect of KYC are followed for opening of
new accounts. Training has been providing continuously to all the category of officers and
executives for developing awareness and skill for identifying suspicious activities.
In addition, the President & Managing Director has provided a Message on Anti Money
Laundering (AML) policy. The management has circulated a Customer Acceptance Policy
to the members of the staff for guidance.
Internal Control and Compliance Risk:
Operational loss may arise from errors and omissions, fraud and forgeries due to lack of
proper internal control and compliance culture. Management through the Internal Control
and Compliance Department ensures controls in all operational areas of the Bank. Internal
Control and Compliance Department undertakes periodical and special audit and
inspection of the branches and departments at Corporate Office for identifying and
reviewing the operational lapses and compliance of statutory requirements as well as
Banks own guidelines. The Audit Committee of the Board also reviews the Audit and
Inspection reports of the Internal Control and Compliance Department. The Bank has
introduced Risk Based Internal Audit (RBIA) and audit rating over its branches from
2006 and prepared comprehensive audit manual which have been approved by the Board
of Directors.
CHAPTER 3
LITERATURE REVIEW
Agrani Bank Limited (ABL) is established in 1972. It is a state owned bank. It is formed
by the composition of ex-Habib Bank ltd and ex-Commerce Bank ltd. There are six
section of ABL (Senpara branch) in GB- Cash, computer, account opening, clearing,
Accounts and local remittance.
The report indicates depth ratio analysis and financial performance of the year 2009,
2008, 2007 of Agrani Bank Limited. Here also calculate financial ratios like Liquidity,
Asset Management, debt Management, Profitability, Market Value. Calculate these ratios
for strong analysis and try to give a current and essential recommendation.
specialized in the production of that commodity in which the producers has the greater
comparative advantage and to allow the other country to produce that commodity in
which it has the lesser comparative advantage. It includes the spectrum of goods, services,
investment, technology transfer etc.
This trade among various countries causes for close linkage between the parties dealing in
trade. The bank which provides such transactions is referred to as rendering international
banking operations. International trade demands a flow of goods from seller to buyer and
of payment from buyer to seller. And this flow of goods and payment are done through
letter of credit (L/C).
3.3. Foreign Exchange Services of Arani Bank Ltd.
ABL is rendering various kinds of services in international transaction of their clients.
Some are described below: 1. L/C Opening: Bangladesh is mainly an import oriented country. So, L/C is a very
important import document which is issued by Bank. In international market two parties
are not known to each other. The importers of Bangladesh give an L/C to exporters of
foreign country to give the assurance of payment. ABL is opening L/C in favor of their
clients.
2. Export processing: When exporters foreign document comes to ABL, ABL collect
payment from foreign bank for its party. ABL purchase bill if their party need early cash.
3. Back to Back and Local L/C: In against of export L/C ABL give the facility to open
Back to Back and Local L/C.
4. Dollar sale and purchase: ABL sales dollar against passport. The rate of exchange is
given by Bangladesh Bank which is changing every day.
(A) Loan facilities:
Loan facility is given to clients to help in foreign exchange. Different types of loan
facility are given below:
Sanction of L/C:
(B) Customers:
ABL is a well known bank is foreign exchange business. It is helping the business and
people working abroad from the very beginning. The kinds of parties of ABL in foreign
exchange are as follows:
1)
2)
3)
4)
5)
6)
b) Export:
Pre-shipment advances.
Purchase of foreign bills.
Negotiating of foreign bills.
Export guarantees.
Advising/ confirming letters-letter of credit.
Advance for deferred payments exports.
Advance against bills for collection.
c) Remittances:
Foreign Remittances
Issue of DD, MT, TT etc.
2009
2010
2011
2012
2013
7753
16792
26877
16963
15947
Table: 10 Imports
Import
2009
2010
15947 7753
201116792
2012
2013
16963
26877
Here the amount of import was increasing from 2009 to 2011 the next two years were
lower due to some unavoidable reasons. Foreign exchange can perform better, if import
would make in greater.
Any such documents as may be required as per instruction issued/to are issued by the
Chief Controller of Imports & Exports (CCI&E) from time to time.
Importer
Public Sector
(Govt. Organs. &
Corporation)
Private
Sector
Commercial
(finished
Products)
Industrial (raw
materials &
machinery)
Actual
Users
Banks normally issued letter of credit Authorization on forms which clearly indicate the
banks name and extent of the banks obligation under the credit. The contents of the LCA
are included following information:
i.
ii.
iii.
iv.
v.
Name of the buyer: Who is also known as the accounted since it is for his account
that the credit has been opened?
Name of the seller: Who is also known as the beneficiary of the credit?
Moment of the credit: Which should be the value of the merchandise plus any
shipping charges intent to be paid under the credit?
Expiration date: Which is specified the latest date document may be presented. In
this manner or by including additionally a latest date, the buyer may exercise
control over the time of shipping.
Documents required: Which will normally include commercial invoice consular
or customer invoice, insurance policies as certificate.
vi.
shipment to check the contents of the goods, number and marks of the
package, quality, per package net weight, gross weight, measurement etc.
b) Weighting and Measurement: Issued by recognized authority (like chambers
of commerce and industry) in exporting country certifying correct weighting
and measurement of the goods. Bill of Entry: A bill of entry is a document
which contains the particulars of the imported goods as well as the amount of
customs duty payable.
3.6(B) EXPORT:
4.1.3 Export Business
The total export business handled by the bank amounted to tk. 7845 crore as of December
31, 2013 which is 3.46% of national figure. From 2012 to 2013, export is decreasing than
others previous years. Major export items were readymade garments, shrimps, tea & nontraditional items.
Year
2009
2010
2011
2012
2013
10000
9000
8000
7000
6000
5000
4000
3000
2000
1000
0
4461
2009
6443
2010
9310
2011
8838
2012
7845
2013
Here the condition of export is same to import business. So both export and import are
flowing in the same trend. The above graph shows the similar performance in that
business. Export business is more important to sustain better foreign exchange
performance.
Export L/C is issued by a foreign bank favoring Bangladeshi exports through our banks
having correspondent relationship with them.
ABL provides different services to the exporter of Bangladesh. To get export facility the
party must have following requirements-
Export advance & loan facility is sanctioned by head office. According to the prospect of
party they take the loan decision (TK. In millions)
Authenticity of L/C (Test agreed in case of Telex L/C and signature verified in
case air
Merchandise specified in the L.C is permissible and clauses incorporated in the
L/C are not against countrys regulations.
B. Add Confirmation of Export L/C: Bank may add additional confirmation to export L/C
where there is specific instruction from the L/C issuing bank to do so. Additional
confirmation of L/C gives the seller a double assurance of payment. Banks requirement
of adding confirmation:
i.
ii.
iii.
iv.
v.
Bill of exchange
Bill of Lading
Packing List
Certificate of Origin
Inspection Certificate.
Insurance Document
Weight List
Any other documents as per L/C
Beneficiary
Applicant
Back to Back
and Local L/C
Opening/
Issuing Bank
(ABL
Negotia
AFPEL
o/und C e r sv c wu i hc r a e ae r
teict n hh o g ee m t h t L e he / s Ce
LPAf r /u c o C rc m c e w h p t i a th
renb e ce l e ne
afi
nc
ev
Da
m
e
rc y u
t
s d
hse e
it
n
For example against $ 2, 00,000 masters L/C, $ 1, 80,000 loan facilities is given. $1,
50,000 is given when L/C is opened $ 30,000 is given after receiving documents.
3.6.6: LDBC: (Local Documentary Bill Collection):
Local documentary bill collection is a service of ABL to collect the bill of their party for
payment. When ABL is advising bank they can collect payment against the document.
When in back to back L/C ABL is advising bank. After the maturation period ABL collect
they Payment by LDBC.
Charges
Advice charge
Commission
Tk. 500
Tk. 730- Tk. 1000
Postage charge
Tk. 20
For example against $ 2, 00,000 masters L/C, $ 1, 80,000 loan facilities is given. $1,
50,000 is given when L/C is opened $ 30,000 is given after receiving documents. Local
documentary bill collection is a service of ABL to collect the bill of their party for
payment.
3.6.8: LDBP: (Local Documentary Bill Payment):
When ABL is advising bank they can collect payment against the document. When in
back to back L/C ABL is advising bank. After the maturation period ABL collect their
payment. The procedure is as following:
1. Exporter presents the documents to ABL for collection from importer within 3 days of
shipment. The document contains the following procedures:
a)
b)
c)
d)
e)
f)
Track receipt.
Commercial invoice.
Packing list.
Delivery receipt.
Country of origin.
Bill of exchange
and M/S Sushi chemicals bank is ABL. So in this case the parties involved are as if Sushi
chemicals want to get payment before the bill maturation, ABL can purchase the bill. It is
called LDBP.
3.6.9: Steps in LDBP:
1) At first a party brings a document of back to back L/C to ABL. The officer checks
the documents. He/she emphasize on which contains the following:
Name of two parties.
USD $ or other currency
Opening data.
2) Issuing bank sends an advice of acceptance to ABL.
3) Party makes following documents:
a) Bill of exchange.
b) Track receipt.
c) Commercial invoice.
d) Packing list.
e) Delivery challan.
f) Delivery receipt.
g) Country of origin.
4) Next party comes for selling the bill to ABL, with all documents.
5) The party collects the voucher and receives payment; rest of. the amount which
was not purchased by ABL. ABL cut the cost of party from it.
3.7(C) REMMITANCE:
The word Remittance comes from the word remit which means to transmit money or
fund. In banking terminology, the work remittance means transfer of fund one place to
another. When money transferred from one country to another country is called Foreign
Remittance (T.K) in millions.
Content
Remittance
2011
343.8
2012
710.32
2013
1428.48
2014
2452.33
2015
3036.42
Foreign (T/T).
Mail Transfer (MT).
Foreign demand draft (FDD).
Import payment.
Travelers cheque.
Export cheque.
Cash dollars.
Credit card (International).
Family maintenance
Indenting commission
Realization of export process
Donation
Medical treatment
Educational purpose
Non-resident accounts.
ABL has achieved positive growth in remittance business though remittance inflow in our
country slowed down last year because of continuous recession in our world. We received
foreign remittance for USD 1,622.58 million in the year 2013 with a growth rate of 13.68
percent out of USD 1,427.33 million of year 2012. Like year 2012, also in 2013 Agrani
Bank Limited has been secured as the first among the State Owned Commercial Banks
and stood second among the banks of Bangladesh. Our contribution to the national figure
of remittance business is 11.73 percent for the year ended on 31 December 2013 and it is
the highest in the last five years of ABL. ABLs easy but instant online remittance
distribution system has enabled to achieve this development in this portfolio. Agranis
contribution in perspective of global achievement in foreign remittance sector is given
below:
Year
Global
ABL
Change in Percentage
2009
10743.03
813.34
7.57
2010
10739.95
989.33
9.21
2011
2012
2013
12168.09
14176.91
13831.65
1167.33
1427.33
1622.58
9.60
10.07
11.73
12168.09
10739.95
10000
Global
8000
ABL
6000
% Change
4000
2000
813.34
989.33
1167.76
2009
2010
2011
1427.33
14176.91
2012
1622.58
13831.65
2013
Foreign remittance was increasing year to year due to better performance of foreign
corresponds. In the global perspective, it positioned better based on last five years
performances.
Foreign Exchange
Department
Import
Department
Export
Department
Remittance
Department
Western Union.
Money gram.
Xpress money payment.
Cash express.
Express money.
Porobhu Express.
ABL quick pay etc.
Western Union money transfer is very popular in Bangladesh. ABL is first to contract
with Western Union. As a result inward remittance can come to Bangladesh in a minuet
from anywhere of the world. People can collect from any branch of ABL from
Bangladesh. For it the receiver dont need any bank account with ABL and they dont
need to pay money. With any branch of ASA the people can collect money which is very
helpful for village people.
Steps for money collection: People can send money from any Western Union agent of the
world. They deposit the money and take a receipt and Money Transfer Controlling
Number (MTCN).
The sender informs the receiver the follows:
a.
b.
c.
d.
Amount of money
Senders name
Receivers name
Countrys name
Other bank and exchange house of Agrani Bank Limited are as following:Serial No & Country names are listed in the following:
1. Australia National Australia Bank Ltd.
2. Switzerland United Bank of Switzerland AG (UBS).
3. Germany Commerce bank A.G.
4. Germany Standard Chartered Bank, GMBH.
5. Italy Unaccredited Italian SPA.
6. U.K Lloyds TSB Bank Plc.
7. U.K. HSBC Bank UK Plc.
8. Japan the Bank of Tokyo-Mitsubishi Ltd.
9. Japan Union De Banquets Arabs ET Franoises (UBAF).
10. U.S.A Bank of America NA.
11. U.S.A JPMorgan Chase Bank.
12. USA HSBC Bank USA.
13. U.S.A Standard Chartered Bank.
14. 15 U.S.A Citibank NA.
15. U.S.A Citibank NA.
16. U.S.A Wachovia Bank NA.
17. Canada Bank of Nova Scotia.
18. Singapore Standard Chartered Bank.
19. Bhutan Bank of Bhutan.
20. India Standard Chartered Bank.
21. India State Bank of India.
22. India Sonali Bank Ltd.
23. India AB Bank Ltd.
24. Nepal Nepal Arab Bank Ltd.
1. Foreign currency transaction system: At the month end how much import, export,
foreign remittance comes and goes out is reported by this software program. At first the
officer will give the posting, then make schedule, checked by foreign exchange head that
statement is created and sent to Bangladesh Bank with different colored pages. The month
end statements should be submitted within date 5 of a month, wrong posting is punishable
worth Tk. 5, 00,000 for the Branch and Tk. 10, 00,000 for the officer.
2. L/C Monitoring System: It is an everyday program governed by Bangladesh Bank.
When L /C is opened foreign exchange officer give the posting in a 3 step L/C monitoring
system by internet. All the monitoring, reporting is governed by Bangladesh Bank
because foreign has the precise impact on the economy.
CHAPTER 4
Particulars
Deposits
Total Assets
Total Equity
Total Operating Income
Total
Operating
Expenditure
Import
Export
Remittance
Paid- up Capital
2011
16628
21406
1144
1636
992
2012
20633
26485
1572
2402
1316
2013
25221
34882
2594
3301
1827
2014
29243
37872
717
3700
2693
2015
34868
44416
3564
4113
3049
7753
16792
26877
16963
4461
6443
9310
8838
5587
7097
8682
11681
497
547
901
991
(Source: Annual Report of ABL-2014-2015)
Table: 7 Financial Performance at a Glance
15947
7845
12657
2072
ABL mission is to provide Banking services to their valued clientele with utmost
proficiency and sincerity reinforced by an efficient workforce and the latest state of
technology
Board of Directors
General Managers
Principal Officers
Senior Officers
Officers
Staff Members
To facilitate and handle all kinds of commercial banking services to its customer
authorized by Bangladesh Bank.
To handle the export and import trade of Bangladesh.
To take part in international banking etc.
The Bank renders commercial banking services to all types of customers. The range of
services offered by the Bank includes- accepting deposit, making loans and advances,
discounting bills, conducting domestic and international money transfers, carrying out
foreign Exchange transactions in addition to international money transfers, and offering
other Customer services such as safe keeping, collections and issuing guarantees,
acceptances and letters of credit. Core business of the Bank includes- deposit,
mobilization and lending activities comprising short- term, long- term, import and export
financing. Financing activities are extended to different sectors of the economy that could
be grouped in to several sectors including Rural & agriculture, Garments & Textiles, Jute,
Cement & Bricks, Tannery, Steel & Engineering, Food & Beverage, Chemical &
Pharmaceuticals, Printing & Packing, Glass & Ceramics and Miscellaneous.
Current deposit
Foreign currency
Account:
ii.Non-Resident Foreign
CurrencyDeposit (NFCD)
A/C
iii. Resident Foreign
CurrencyDeposit (NFCD)
A/C
Foreign
Exchange
Market:
Cash Credit
i.Preparation of
Exchange Rate
ii.Secured Overdraft
ii.Swap
iii.InlandBillPurchase
iii.Term
Placement
vi.Letter of credit
v.Industrial Credit(IC)
v.Letter of
Credit-Sight
vi.Back to Back
L/C
The followings are the detail list of Products and Services of Agrani Bank Ltd:
4.6.1 Accounts & Deposits:
Savings Deposits and Fixed Deposits:
Fixed Deposit Receipt (FDR)
Savings Bank Account: (SBA) - Savings Bank Account can be opened in any branch of
Agrani Bank Limited Bank by any Bangladeshi citizen in the name of an individual or a
group of individuals which can be operated singly or jointly:
Fixed Deposit Receipt: (FDR) - Opening a Fixed Deposit Account for different terms
with any Branch of Agrani Bank is very simple. Any individual or a group of individuals
can step in to any Branch of Agrani Bank, fills Out a prescribed form, hand out over the
counter cash or easily cashable instrument of any amount and leave the Branch with a
Fixed Deposit Receipt.
Agrani Bank Pension Sanchay scheme.
Agrani Bank Bishesh Sanchay scheme.
6. Loan against Imported Merchandise (LIM) - Everything is O.K. but importer fails
to clear goods from the port and request bank to clear.
In this case, Banks clear the goods and takes delivery like same, by paying customs duty
and sales tax etc. So, this expenditure is debited to the importers account and in banking
it is called LIM.
7. Loan against Trust Receipts (LTR) Advance (Loan) against a Trust Receipt
obtained from the Customers, which are allowed only to the first class tested parties,
when the documents are covering an import shipment or other goods pledged to the Bank
as security are given without payment. However, for such advances prior
permission/sanction from Head Office must be obtained. The customer holds the goods or
their sale-proceeds in trust for the Bank, till such time, the loan allowed against the Trust
Receipts is fully paid off.
8. Consumer Finance Scheme There are branches and finance centers under this
division which have qualitative workforce of employees.
Some of the services provided by this division are unsecured personal loans, credit cards,
and vehicle related lease etc.
9. Hire-Purchase Scheme As Bank make their own investment in Government
securities (like- Government treasury bills, prize bonds, Bangladesh Bank bills, special
treasury bonds& reverses repo) and in other investment which sometime borrower wants
to hire as a loan from the Bank. That is why this loan is known as hire of Banks purchase
scheme.
10. ATM Banking - Agrani Bank Ltd. has implemented successfully Automated Teller
Machine. (ATM) /DEBIT card transaction from June 25, 2008. Through Automated Teller
Machine (ATM) /Debit card, customer can avail the facilities like withdrawal money,
balance inquiry and purchase goods.
11. SMS Banking - Agrani Bank Ltd. has officially launched SMS banking service from
December 2011.
12. Lockers - For safekeeping of customers valuables like important documents and
goods like jewelries and gold ornaments, ABL Locker Service is available in most of the
Branches in urban areas. Their nature of service is like custody of locker/ safe and nature
of charge is like rent.
13. Education Remittance Students who are desirous (wishing or wanting) to study
abroad for them this Bank is giving education remittance service. In this service, this
Bank assures their remittance of funds in abroad for study.
Open communication
Teamwork
Core
Values
Performance driven
Quality
Continuous self
Improvement
ABLs core values consist of 6 elements. These values bind our people together with an
emphasis that our people are essential to everything being done in the Bank.
Open Communication:
Performance Driven:
Continuous learning, self- challenge and make ways for self improvement of
workforce at Agrani Bank Limited.
ABL offers hassle free better service timely.
ABL builds-up assets in the portfolio.
Interaction, open communication, and maintaining a positive attitude reflect
ABLs commitment to a supportive environment based on teamwork.
another list of branches in that particular district and so on any branch names will show
you total branch information directly. We have arranged the list firstly by district names
and secondly by branch names alphabetically.
List of On-Line Branches of Agrani Bank Limited under Wide-Area Network(WAN):
SL No
1
2
3
4
5
6
7
8
9
previous year, registering a growth of 62.22 percent. The portfolio of investment of the
bank as on 31 December 2013 is shown below:
Table: 13 Types of Investment
Types
2014
Govt. securities
Non-Govt. securities
Total
12825.24
2167.62
14992.86
2015
7118.17
2123.81
9241.98
Here both govt. and non-govt. securities were increasing from one year to another year.
The more investment can show better contribution in SLR.
Year
2011
4095
2012
4264
2013
8376
2014
9242
2015
14993
Table: 14 Investments
16000
14000
12000
10000
8000
6000
4095
4000
2000
0
2011
14993
8376
9242
4264
2012
2013
2014
2015
The previous five years of investment show the upward sloping and this investment do
better business performance. So the overall portfolio of investment can do the most
performance.
4.2. Financial Performance Analysis
Taka in crore
Year
2011
2012
2013
2014
2015
Operating Income
1636
2402
3301
3700
4113
992
3094
1316
2011
1827
2693
2012
2013
2014
2015
1. Capital Surplus increased to Tk. 73 chore in 2010 from deficit of Tk. 67 chore in 2011.
2. Classified Loan reduced to Tk. 2,374 chore in 2010 from Tk. 2,549 chore in 2012.
3. Paid-up capital increased to Tk. 497 chore in 2010 from Tk. 248 chore in 2013.
4. Net Interest Margin (NIM) improved by 0.31% in 2010 to 0.37% in 2014.
5. Capital Adequacy Ratio increased from 9.16% in 2010 to 10.80% in 2015.
6. Liquidity ratios increased significantly. Current ratio increased from 0.51% in 2011 to
1.36% in 2015.
3000
2500
2000
1500
1000
Series 1
500
Column1
2011
2012
2014
2015
(Figure 1.1 Profitability Position of Agrani Bank limited at a glance since 2015)
(According To the Annual Report of ABL 2014, 2015)
Here operating income is growing every year. A graph on operating income is presented in
below-
4500
4113
4000
3500
3000
2500
2000
1500
1000
500
0
1636
2009
2402
2010
3301
2011
3700
2012
2013
From the above graph, I can see total operating income is increasing in every year. This
increasing situation continues in line with operating profit. So this result would assist to
increase the net operating profit of ABL.
2011
2012
2013
2014
2015
Operating Expenditure
992
1316
1827
2693
3094
The banks total operating profit before amortization, provision and tax stood at Tk.
1,063.93 crore in 2015.The operating profit was increasing from 2011 to 2013, but it
decreased more in 2014 and somewhat it rose in 2014 comparing with 2015.
Year
2011
2012
2013
2014
2015
Operating Profit
2000
1500
1000
500
0
644
2011
1086
2012
1474.4
2013
1007
2014
Profitability:
During the year 2007, the Bank has incurred an operating loss of Tk.75.21 crore and the
net loss stands at Tk.2172.11 crore owing to charging of cumulative provision shortfall
against loans & advances and super annotation fund since 1972 in order to comply with
IAS-30 which has been adopted in Bangladesh as BAS-30 and implemented by
Bangladesh Bank vide BRPD Circular, No.14 dated 25 June 2003 and as such the
auditors certified the accounts without any qualification. In spite of huge volume of
accumulated loss in 2004, the Bank is on the path of recovery and takes steps in
consolidating its position resulting in an operating profit of aboutTk.1 09.00 crore attend
of June 2005.
4.13 Total Assets Position of Agrani Bank for the last 5 years [with Graphical
presentation] (2011, 2012, 2013, 2014 & 2015)
120000
100000
80000
60000
40000
20000
0
2011
2012
2013
2014
2015
Petroleum Goods
Export
Earnings
increased
24.10 %
Foot wear
19.40 %
Frozen foods
16.20 %
jute Goods
15.70 %
Chemical goods
14.60 %
leather
15.00 %
13.40 %
Handicraft Goods
14.60 %
Agriculture
goods
11.10 %
Readymade Garments
13.80 %
Engineering Products
8.90 %
knitwear
8.40 %
Ceramic Products
6.80 %
Sectors
Sectors
Export Earnings
Decreased
Tea
42.70 %
Petroleum Goods
Export
Earnings
increased
24.10 %
Foot wear
19.40 %
Frozen foods
16.20 %
jute Goods
15.70 %
Chemical goods
14.60 %
leather
15.00 %
13.40 %
Handicraft Goods
14.60 %
Agriculture
goods
11.10 %
Readymade Garments
13.80 %
Engineering Products
8.90 %
knitwear
8.40 %
Ceramic Products
6.80 %
Sectors
Sectors
Export Earnings
Decreased
Tea
42.70 %
handicraft goods
Foot wear
7%
7%
5%
11%
Readymade garments
12%
12%
Ceramic products
jute goods
leather
19%
15%products
Engineering
12%
knitwear
The total import payment stood at US$ 26,944.50 million by increasing 11.22 percent
during FY2011-12. Import growth slowed down recently as import of unimportant goods
was discouraged.
Country wise Import Goods
Countries
China
India
Malaysia
Percentage
Percent out of Total Imported Goods
18.98 %
13.85 %
6.15 %
Table: 19 Total Imported Goods
Country wise import goods analysis shows that, China stands at first position in terms of
import goods. 18.98 percent out of total import has been imported from China. Second
and third positions are India 13.85 percent and Malaysia 6.15 percent respectively.
Analyzing the category of imported goods, it is observed that, import payment of capital
machinery, industrial raw materials decreased by 38.75 percent, 35.52 percent
respectively and the major import payment of consumer goods decreased by 36.27
percent. The remittances played a vital role in expediting economic development of the
country including reducing unemployment problem, poverty alleviation, boosting up the
foreign currency reserve. The lion share of the foreign remittance comes from the
countries of Middle East. In this regard, Saudi Arabia has been in top position for the last
couple of years. Yet, recently, the inflow of remittance has increased from Malaysia,
Singapore, UK, and some other countries. To explore new manpower export markets, the
government has undertaken several steps through diplomatic initiatives alongside
establishing new labor wings in several countries. There is also an attempt to impart
training on various trades to create skilled labor force to meet the demand of labor
markets abroad.
Type
As on 31-12-2014
Amount
% of Total
Current deposits
STD
Savings deposits
Fixed deposits
DPS
APS
Others
Total
As on 31-12-2015
Amount
% of Total
Deposits
724.60
6.17%
1359.93
974.00
8.29%
1054.81
4373.82
37.25%
4769.84
2690.79
22.91%
2627.80
381.07
3.25%
127.72
1923.95
16.38%
2318.6
674.48
5.75%
280.80
11742.71
100.00%
13538.96
Exibit 14 : Business Performance
Deposits
10.85%
8.41%
38.04%
20.96%
1.02%
18.48%
2.24%
100%
Asset Quality
The new management has placed utmost importance to improve the quality of assets and
as such an amount of Tk.240.41 crore was recovered in cash from the classified loans and
advances in 2007 as against Tk. 162.80 crore of 2006. Moreover, the classified loans
reduced to 28.07% in 2007 as against 29.57% of 2006. The performing loans in 2007
increased by Tk. 609.90 crore to Tk. 6900.02 crore from Tk. 6290.12 crore in 2006.
4.14 Total Liability & Shareholder equity Position of Agrani Bank Ltd.for last 5
years [With Graphical Presentation] (2011, 2012, 2013, 2014 & 2015)
Charges
Advice charge
Commission
Postage charge
Content
Remittance
2011
343.8
Tk. 500
Tk. 730- Tk. 1000
Tk. 20
2012
710.32
2013
1428.48
2014
2452.33
2015
3036.42
3500
3000
2500
2000
Column2
1500
1000
500
0
2011
2012
2013
2014
2015
Year
2009
2010
2011
2012
2013
Deposits
16628
20633
25221
29243
34868
Table: 9 Deposits
40000
30000
20000
20633
10000
0
16628
25221
29243
34868
Here total deposits are increasing from year to year. So I can say that overall function of
deposit collection is better. In the prevailing situation, mobilization of deposits became
highly competitive and hence cost of fund would increase compared to the previous year.
3.7 Loans and Advances
General Credit
The amount of loans and advances of the Bank as at the close of 2007 was Tk. 118.49
billion as compared to Tk.105.87 billion in the previous year: advances increased by
12.62 billions with a growth rate of 11.92 per cent.
The outstanding loans and advances as on 31 December, 2007 are shown in the chart
below:
The outstanding loans and advances as on 31.12 2007
(Taka in billion)
Tk. 25.87
Tk. 22.54
Tk. 21.63
Tk 0.61
Tk 5.65
Tk 7.61
Tk 6.95
Tk. 12.27
Tk. 5.55
Tk. 9.82
7%
7%
Chemicals
7%
Agro-based
10
Service
3%
Pharmaceuticals
%
1%
50%
Textile
&
Ready-mad
Goods
4%
Garments
Cement
0.38
Others
%
7%
Cold Storage
Credit Lines
Agrani Bank Limited has utilised IDA Credit, Exim Credit, ADB Credit and OPEC credit
lines for onward lending in addition to Banks own sources. The balance outstanding
against the loans and the number of project funded are appended Below:
(Taka in billion)
Number of Project
Amount Outstanding
a. Foreign Fund
262
0.62
2476
21.54
SME Credit
Beyond conventional banking, the Bank has also been participating in several SME
programmers through its own efforts and in collaboration with different national and
international agencies like Bureau of Manpower Employment and Training (BMET),
Bangladesh Small and Cottage industries Corporation (BSCIC), NGOs (Bangladesh Rural
Advancement Committee-BRAC, Association for Social Advancement- ASA, Grameen
Uddag), international Fund for Agricultural Development (IFAD), United States Agencies
for International Development (USAID), Asian Development Bank (ADB), Norwegian
Agency for Development Co-operation (NORAD), Swedish International Development
Agencies (SIDA) etc. These are aimed at reinforcing efforts of the Government to meet
strategic objectives of alleviating poverty of the rural poor, supporting small and micro
Annual
Target of
Recovery
(2007)
Classified
Loan
27.82
Overdue
Loan
Type of
Loans
Tota
l
Percentage of
target
Accomplishme
nt
Others
*
1.23
Writeoff
2.70
Total
10.00
Cash
Recover
y
2.19
6.12
61%
4.40
4.40
2.32
1.80
0.00
4.12
94%
32.22
14.40
4.51
3.03
2.70
10.2
4
71%
Classified
Loans
Overdue
Loans
Total
The Banks total income after corporatisation was Tk. 7.08 billion while total income
earned in 2007 stood at Tk. 13.68 billion as against total income of Tk. 12.33 billion in
2006, registering an increase of Tk. 1.35 billion which was 10.95 per cent higher over the
last year.
Total Expenditure
After corporatisation, total expenditure stood at Tk.4.30 billion whereas during 2007 total
expenditure was Tk. 8.42 billion. In 2006, total expenditure was Tk.8.75 billion.
Net Profit
After corporatisation, the Banks after-tax net income stood at Tk.0.86 billon. However,
during 2007, the Banks total net profit stood at Tk.3.16 billion as against Tk. 1.94 billion
of 2006, showing an increase of 62.88 cent the net profit of 2006.
Shareholders Equity
As per venders agreement dated 15 November, 2007 the Agrani Bank Limited has paid
Tk.2.48 billion by issuing shares to the Government. The equity of the Bank stood at Tk.
3.34 billion on 31 December, 2007 along with reserve and undistributed profit of Tk.0.86
billion.
Appropriation of Profit
Out of the net profit of Tk.0.86 billion (after tax) earned after corporatisation, the Board
of Directors proposed to transfer an amount of Tk.0.16 billion to Statutory Reserve
Account and the rest balance amount of Tk. 0.70 billion to Retained Surplus Account. No
dividend for the year 2007 has been recommended by the Board.
Letters of guarantee
1,050,604,255
Letters of credit
42,568,362,821
11,069,872,267
2,132,659,069
11,139,987,000
December 31,
2007
Taka
8,584,441, 263
1,728,481,748
Balance with Bangladesh Bank and its agent bank (including foreign
currencies)
6,855,959,515
3,360,727,185
In Bangladesh
1,111,786.077
Outside Bangladesh
2,248,941,108
1,110,000,000
Investments:
21,902,263,978
Government
19,714,838,500
Other
2,187,425,478
118,493,857,283
115,597,766,338
2,896,090,945
2,481,337,763
Other assets:
30,347,758,101
Non-banking assets:
Total assets
186,280,385,573
9,422,761,235
135,921,381,916
21,164, 487,330
Bills payable
3,066,541,752
60,011,825,052
Fixed deposits
51,678,527,782
Other liabilities:
37,593,533,139
Total liabilities :
182,937,676,290
2,484,200,000
Reserve:
159,728,906
Statutory reserve
159,728,906
698,780,377
3,342,709,283
186,280,385,573
December 31,
2007
Taka
Contingent Liabilities:
67,961,485,412
Taka
Interest income
4,380,233,235
2,619,649,994
1,760,583,241
Investment income
Commission, exchange earnings and brokerage
Other operating income
Total operating income (A)
949,921,751
1,424,781,198
328,922,154
4,464,208,344
Operating expenses
Salary and allowances
Rent, taxes, telecommunication etc.
Legal expenses
Postage, stamp, telecommunication etc.
Stationery, printing, advertisement etc.
Managing Directors Salary and allowances
Directors fees
Auditors fees
Depreciation and repair of banks assets
1,348,606,092
122,771,951
6,569,702
38,368,267
45,346,073
549,040
2,013,680
53,980,314
65,505,068
1,683,710,187
2,780,498,157
1,618,001,212
Other provision
Total provision (D)
363,852,417
1,981,853,629
Deferred tax
(59,864,755)
(59,864,755)
858,509,283
858,509,283
Appropriation :
Statutory reserve
159,728,906
General reserve
Retained surplus
698,780,377
34.56
5,023,538,840
(2,862,463
080)
3,730,156
497,497,986
71,645,564
1,457,458,672
6,394,910,242
2,100,00,000
(13,872,630,8
25)
(2,692,518,91
2)
(8,070,239,49
5)
(142,623,775)
Other liabilities
1,382,964,482
)
1,240,340,707
B.
(5,372,440,116)
Other bond
(2,852,356,000
)
Debenture
15,000,001
Purchase of securities
Purchase/ sale of properties, plants & equipment
Proceeds from sale of properties, plant & equipment
(24,000)
(21,735,908)
-
(2,859,115,907)
(408,743 828)
6,845,845,817
6,437,101,989
(1,794,454,034
13,978,579,920
13,063,987,948
879,862,062
Other
Reserv
e
profit and
Loss
Account
Total
Capital
Assets
Revaluatio
n Reserve
Taka
Taka
Taka
Taka
Taka
Taka
2, 484, 200,
000
2,484, 200,
000
Paid-up
Particulars
Restated balance
2,484, 200,
000
Surplus/ deficit on account of
revaluation of investments
Currency transaction
differences
2,
485,200,000
2,484, 200,
000
159, 728,
906
698,780,377
3,342,709,283
(Taka in billion)
Agrani Bank
Total
Agrani Bank
Limited
2007 ( 01
July to
31 Dec.)
(01 Jan.
2007 to 31
Dce.
2007)`
2007
2003
2004
2005
2006
(01 Jan.
to 30
June)
Paid-up Capital
2.48
2.48
2.48
2.48
2.48
2.48
2.48
Reserve Fund
0.34
0.34
.34
0.29
0.16
0.16
0.70
0.70
Total Equity
2.82
2.48
3.34
3.34
Total Deposits
136.06
135.92
135.92
89.31
95.92
99.40 105.87
104.56
118.49
118.49
79.67
71.32
75.41
83.58
83.63
95.09
95.09
Investments
31.50
26.85
24.33
22.31
27.46
21.90
21.90
i. Imports:
28.97
35.91
51.19
115.92
63.05
50.38
113.43
ii. Exports:
35.75
41.97
41.71
51.71
24.93
23.99
48.92
iii. Remittances:
27.43
36.84
34.57
39.30
20.22
22.59
42.81
Total:
108.20
96.96
205.16
Guarantee Business
1.38
1.21
1.18
1.08
1.03
1.05
1.05
Total income
9.40
9.02
10.60
12.33
6.60
7.08
13.68
Total Expenditure
9.13
9.77
8.46
8.75
4.12
4.30
8.42
Provision
0.26
20.97
3.74
0.29
0.24
1.98
2.22
Interests Suspense
8.50
11.24
9.59
8.92
7.98
9.50
9.50
Fixed Assets
0.48
0.48
0.44
0.41
.39
2.48
2.48
Forex Business
Total Assets
Operating Profit
0.26
(0.75)
2.14
0.001 (21.72
4
)
1.63
Cost of Fund
Number of Branches
872
Number of Employees
870
864
160.49
186.28
186.28
3.58
2.48
2.78
5.26
1.94
2.30
0.86
0.86*
6.52%
6.68%
6.68%
866
866
866
866
11793
11568
11345
11345
37
41
41
38
38
39
39
391
399
410
416
416
416
416
Return on Equity
7.78
%
29.55%
29.55%
Return on Assets
1.43%
0.92%
0.92%
3.56%
3.69%
3.69%
9.53%
10.68%
10.35%
10.35%
76.85%
87.18%
87.18%
26.94%
26.83%
26.83%
8.23%
8.82%
8.82%
* Total net profit after tax of the former Agrani Bank and the Agrani Bank Limited for
the year 2007 stood at Tk. 2.30+0.86) =3.16 billion. However, net profit of Agrani Bank
up to 30 June 2007 amounting to Tk. 2.30 billion has been squared off against valuation
adjustment.
Taka inBillion
Statement of Affairs
2004
2005
2006
2007
Authorized Capital
8.00
8.00
8.00
8.00
Paid-up Capital
2.48
2.48
2.48
2.48
Reserve fund
0.34
0.34
0.29
0.57
Total Deposit
125.39
130.84
128.92
135.92
95.92
99.40
105.87
118.49
71.32
75.41
83.58
85.75
Investment
26.85
24.33
22.31
22.19
i) Imports
35.91
51.19
115.92
125.38
ii)Exports
41.97
41.71
51.71
53.99
iii)Remittances
36.84
34.57
39.30
41.29
Total:
114.72
127.47
206.93
220.66
Guarantee Business
1.21
1.18
1.08
1.22
Total Income
9.02
10.60
12.33
15.73
Total Expenditure
9.77
8.46
8.75
10.47
Provision
20.97
3.74
0.29
0.37
Fixed Assets
0.48
0.44
0.41
0.43
Total Assets
151.38
155.53
154.08
156.22
Operating Profit
(-)0.75
2.14
3.58
5.26
Net Profit/Loss
*(-)21.72
1.63
1.94
2.89
Cost of fund
8.51%
6.95%
6.84%
6.55%
Number of Branches
870
864
866
866
Number of Employee
12208
11938
11793
11345
Forex Business:
Number of Foreign
399
410
416
416
Return on Assets
(-) 0.50%
1.38%
2.32%
2.37%
(-)0.45%
1.73%
2.96%
3.04%
7.59%
7.94%
9.53%
10.06%
Loans to Deposit
76.50%
75.98%
82.12%
87.17%
28.07%
28.31%
26.27%
26.02%
3.25%
5.51%
6.61%
6.36%
Correspondence
CHAPTER-5
I.FDBC: If the export document is not purchase by ABL, it is called foreign documentary
bill collection. At the maturation data of export bill, ABL collects the payment for party.
The collection process is same as LDBC. Only the postage charge is high. The postage
charge is Tk. 800 within SAARC countries within Asia Tk.1500 and outside Asia is Tk.
2000.
II. FDBP: If the exporter need money before that the maturation of export document. He/
She can sale it to ABL. It is called foreign documentary bill purchase.
A detail section of Foreign Exchange operations of agrani bank is provided in the later
part of the report.
reasonable care to ascertain whether they confirm with the terms of the credit, the bank
may negotiate and pay the value of export bill to the exporter.
1.3.5
Administrative Activities:
The administrative activities of the bank are comprised with Personnel & Human
Resources Division (PHRD). The functions of this division is to maintain the number
of present manpower in the bank; placing the officials according to their promotion or
demotion; recruiting new personnel; providing training programs for them and release
personnel according to their age of retirement.
125.38 Billion in 2006. Similarly, the export earnings also increased to Tk.4, 2.28 in 2006
from Tk.51.71 Billion, which was higher by Tk.53.99 Billion compared to 2006.
The Foreign Exchange Remittances from Bangladeshi nationals working abroad
increased remarkably by Tk.1.99 Billion to Tk. 41.29 Billion in 2007 from Tk 39.30
Billion in 2006. This increase was 34% higher than the previous year.
The summarized position of imports, exports and inward remittances are furnished in the
following:
Imports
Exports
Remittances
(Taka in Billion)
Sl No Item
1.
Imports
2.
Exports
3.
Remittances
Grand Total
2006
2007
Increase
115.92
125.38
9.36
51.71
53.99
2.28
39.30
41.29
1.99
206.93
220.66
13.63
Table 15 : Foreign Exchange Business
Growth rate
24%
17%
34%
24%
Agrani Bank Limited has as many as 399 foreign correspondents throughout the world
for smooth conduct of International Trade and settlement thereof. In addition to this. The
Bank is maintaining 40 NOSTRO Accounts in US Dollar. Euro and some other currencies
with those first class banks. Which are located in important financial center of the world.
In order to increase the inflow of foreign remittances from the Bangladesh expatriates
working abroad, the Bank has Taka Draft/Electronic Fund Transfer arrangement with 19
Exchange Houses and 4 banks of the Middle East and the Gulf States. The Bank's
constant endeavor and commitment to send the remittances within the shortest possible
time to the beneficiaries have also encouraged the remitters to send more money through
the Agrani banking channel.
4th Board meeting of Agrani Exchange House Pte. Ltd. Singapore Treasury Operation
Foreign exchange dealing, money market operation. Investment in Treasury Bills, Shares
& other Capital market operations, maintenance of Cash Reserve Requirement (CRR) and
Statutory Liquidity Requirement (SLR) are the major functions of the Treasury. The
foreign exchange operations were conducted taking into consideration of the L/C.
commitment. Foreign remittance inflow and export performances.
iron & steel, hatchery, sugar, cement, medicine & chemical, frozen food, tea, ready-made
garments, leather etc. Agrani Bank Limited helps to keep the price of food grains stable
to meet the shortfall of the same providing advances for internal procurement of food
grains. As a nationalized commercial bank, Agrani Bank Limited has been sharing the
vital role in all economic activities of the country and these efforts will also be continuing
in future.
Liquidity Position
Agrani Bank Limited
Bangladesh and enjoys confidence of the depositors and other clients. Joint venture
partners and foreign creditors. The Bank, at present, is a net moneylender in money
market and is investing a daily average of Tk 849.00 crore in local currency and also
selling excess foreign .currency to other banks equivalent to Tk 8.02 crore on an average
per day. The ratio of loans & advances to deposits was increased by 0.44% over the last
year & stood at 76.50% at the close of 2007 which was 76.04% at the end of 2006.
Industrial Credit
Agrani Bank Limited has been playing a pivotal role in supporting the Government
policy of rapid industrializations. The Bank continues to provide its specialized services
for financing medium and long-term capital finance as well as short-term working capital
finance to industrial projects. The total outstanding against industrial project loan as on
31stecember 2007 stands at Tk. 1812.55 crore which is 19% of the Bank's total loan
portfolio. Agrani Bank Limited has extended credit facilities to all-important sub-sectors
of the economy.
Credit Lines
The Agrani Bank Limited has utilized the following credit lines for onward lending.
1.3.10 Investment Portfolio
The amount of investment decreased by Tk. 465.47crose and stood at Tk. 2684.77crore in
2007 as against Tk. 3150.24crore in 2006. The principal reason for decrease of
investment was due to diversion o fund by encashment of short-term Treasury Bills to call
money, balance with other banks and advances to in creases to increase income.
5.7 Other Activities of the Bank :
Agrani Bank Limited Shilpa Unnayan Bond sale programme:
Agrani Bank Limited in order to create a fund of Tk.500 crore to finance the industrial
sector, has introduced Agrani Bank Limited Shilpa Unnayan Bond. The time period of
the Bond consists of 5 and 7 years with the face value of Tk. 50,000, Tk. I, 00,000 and
Tk. 5, 00,000. The rate of interest for 5-year term bond is 10% while for 7 year it is 11 %.
The purchaser's fund so invested is tax-free. But, if the interest earned exceeds Tk.
25,000, a taskbar at the rate of 10% will be levied. The Bank invests sales proceeds of the
Bond in developing industries of the country. The Industrial Credit Division is responsible
for monitoring sale of the Bond. Up to December 2007, the Bank sold Bonds worth
Tk.282.85 crore and invested Tk. 27.11 crore.
Female Secondary School Assistance Project II (FSSAP-II):
The Bank has been entrusted with the task of disbursing stipend to 8.50 lac female
students at 119 Upazilas under supervision of the world Bank. In 2007, Tk. 28.00 crore
has been disbursed.
Female Secondary Stipend Project (FSSP):
In order to speed up literacy in women, Bangladesh Government has initiated this
programme to provide stipend to female students. The Bank has been entrusted with the
disbursement for Dhaka Division. The Bank, through its 90 branches, disbursed Tk.9.00
crore among 2.87 lac female students of 62 Upazillas under this scheme in 2007.
Female Education Stipend Project(FESP):
Funded by NORAD, this programme has been started to increase literacy in women in 19
upazilas. The Bank disbursed as stipend and tuition fees of Tk. 4.18 Crore to 0.62 lac
female students in 2007.
Primary Education Stipend Project (PESP):
The government has undertaken this programme from its own finance to increase the rate
of literacy as well as to prevent the dropout rate at primary level across the country.
Agrani Bank Limited , through its 49 branches, disbursed Tk 39.00 crore among 5.14 lac
students under 49 upazillas of Sylhet and Barisal divisions.
Scale items
Factor organizational
Commitment
0.786
0.782
similar
This organization really inspires that very best in
0.756
0.753
0.690
0.577
During my three months period of internee I have learnt about different foreign exchange
operations which are carried out by ABL.A short focus area of my learning is highlighted
below:
CHAPTER-6
ANALYSIS AND FINDINGS
6.1. Analysis related with Foreign Exchange Operations of Agrani Bank:
2. Weaknesses:
3. Opportunities:
Experienced Managers.
Growth of sales volume.
4. Threats:
Upcoming Banks/Branches.
Different services of FCBS (Phone Banking/Home Banking).
Similar products are offered by other banks.
Default Loans.
Financial Crisis.
Existing card services of Standard Chartered Bank or other private Bank.
Daily basis interest on deposit offered by HSBC.
Entrance of new PCBs.
Government has been controlling industrial credit.
Recession of global economy.
Intensification of competition in the industry.
on the right. The diagram visually shows that stars have high market share and a high
growth rate, while question marks have low market share and a high growth rate. On the
bottom, cash cows have a low growth rate but a high market share, and dogs have a low
market share and a low growth rate.
tied up in them, even though they are bringing back basically nothing in return. These
business units are prime candidates for divestiture.
Question marks: These parts of a business have high growth prospects but a low market
share. They are consuming a lot of cash but are bringing little in return. In the end,
question marks, also known as problem children, lose money. However, since these
business units are growing rapidly, they do have the potential to turn into stars.
Companies are advised to invest in question marks if the product has potential for growth,
or to sell if it does not.
As BCG founder Bruce Henderson wrote in 1968, "all products eventually become either
cash cows or pets [dogs]. The value of a product is completely dependent upon obtaining
a leading share of its market before the growth slows."
Once a company plots out its matrix, it can begin to further analyze its products potential.
Understanding cash flow:
To understand the elements of the Agrani Bank Ltd., companies should be mindful of the
sources of cash flow. Henderson wrote that four rules are responsible for product cash
flow:
Margins and cash generated are a function of market share. High margins and high
market share go together.
Growth requires cash input to finance added assets. The added cash required to
hold share is a function of growth rates.
High market share must be earned or bought. Buying market share requires an
additional increment or investment.
No product market can grow indefinitely. The payoff from growth must come
when the growth slows, or it never will. The payoff is cash that cannot be
reinvested in that product.
Figure-1
Current Ratio:
The current ratio is a liquidity ratio that measures a company's ability to pay short-term
and long-term obligations. To gauge this ability, the current ratio considers the current
total assets of a company (both liquid and illiquid) relative to that companys current total
liabilities.
The formula for calculating a companys current ratio, then, is:
Current Ratio = Current Assets / Current Liabilities
The current ratio is called current because, unlike some other liquidity ratios, it
incorporates all current assets and liabilities.
Interpretation:
Here current ratio is 0.11163 in 2009, 0.17023 in 2008, and 0.08942 in 2007.But the
Industry average is 4.1 x s. So it is the poor performance of Agrani Bank.
Figure-2
Fixed Asset Turnover:
The fixed-asset turnover ratio is, in general, used by analysts to measure operating
performance. It is a ratio of net sales to fixed assets. This ratio specifically measures how
able a company is to generate net sales from fixed-asset investments, namely property,
plant and equipment (PP&E), net of depreciation. In a general sense, a higher fixed-asset
turnover ratio indicates that a company has more effectively utilized investment in fixed
assets to generate revenue.
The fixed-asset turnover ratio is calculated as:
Interpretation:
Here fixed asset turnover ratio is 57.73 in 2009, 58.02 in 2008 and 54.68 in 2007. The
industry average is 4.0 xs so it is the high performance of agrani bank
Figure-3
Total Asset Turnover:
Total Asset turnover ratio is the ratio of the value of a companys sales or revenues
generated relative to the value of its assets. The Asset Turnover ratio can often be used as
an indicator of the efficiency with which a company is deploying its assets in generating
revenue. This Ratio is calculated byAsset Turnover = Sales or Revenues / Total Assets
Interpretation:
Here total asset turnover is 0.78 in 2009, 0.78 in 2008, and 0.72 in 2007.And the industry
average is 2.1 xs so the performance of this sector is low.
Figure-4
A financial ratio that measures the extent of a company or consumers leverage. The debt
ratio is defined as the ratio of total long-term and short-term debt to total assets,
expressed as a decimal or percentage. It can be interpreted as the proportion of a
companys assets that are financed by debt.
Interpretation:
Here Debt Ratio is 1.87 in 2009, 1.97 in 2008, and 1.80 in 2007. Here debt ratio is
decrease in 2009.And it under controlled. Because the industry average is 4.50 percent.
Figure-5
Times interest Earned
Times interest earned (TIE) is a metric used to measure a company's ability to meet its
debt obligations. The formula is calculated by taking a company's earnings before interest
and taxes (EBIT) and dividing it by the total interest payable on bonds and other
contractual debt. TIE indicates how many times a company can cover its interest charges
on a pretax earnings basis.
BREAKING DOWN 'Times Interest Earned - TIE'
Failing to meet these obligations could force a company into bankruptcy. TIE is also
referred to as the interest coverage ratio.
Figure-6
Profit Margin Ratio:
Profit margin is part of a category of profitability ratios calculated as net income divided
by revenue, or net profits divided by sales. Net income or net profit may be determined by
subtracting all of a companys expenses, including operating costs, material costs
(including raw materials) and tax costs, from its total revenue. Profit margins are
expressed as a percentage and, in effect, measure how much out of every dollar of sales a
company actually keeps in earnings. A 20% profit margin, then, means the company has a
net income of $0.20 for each dollar of total revenue earned. While there are a few
different kinds of profit margins, including gross profit margin, operating margin, (or
"operating profit margin") pretax profit margin and net margin (or "net profit
margin") the term profit margin is also often used simply to refer to net margin. The
method of calculating profit margin when the term is used in this way can be represented
with the following formula:
Interpretation:
In 2009 there profit margin was 3.57 percent, 4.31percent in 2008, and 3.86 percent in
2007.In three years their profit margin on deposits was higher in 2008 but the industry
average is 4.7 percent so here their performance is low.
Figure-7
Return on Assets:
Return on assets (ROA) is an indicator of how profitable a company is relative to its total
assets. ROA gives an idea as to how efficient management is at using its assets to
generate earnings. Calculated by dividing a company's annual earnings by its total assets,
ROA is displayed as a percentage. Sometimes this is referred to as "return on investment".
The formula for return on assets (ROA) is:
Interpretation:
Here Return on total asset for Agrani Bank was 3.04 percent in 2009, 3.37 percent
in2008, 2.82 percent in2007. So in 2008 there performance is high. The industry average
is 12.6%. The performance is ok. If their return on total asset is higher than 12.6% so
there performance is low.
Figure-8
MARKET/BOOK:
The book-to-market ratio is a ratio used to find the value of a company by comparing the
book value of a firm to its market value. Book value is calculated by looking at the firm's
historical cost, or accounting value. Market value is determined in the stock market
through its market capitalization.
Formula:
Interpretation:
Here a small different in 2009 and 2008. 2008 and 2007 was some ratio. Here the
industry average is 2.0xs. So in this section the performance of ABL was low. This ratio
is smaller than the industry average.
Financial Ratios:
1.
Liquidity ratios- A liquid asset is one that can be easily converted to cash
without significant loss of its original value.
Current RatioThe ratio is calculated by dividing current assets by current liabilities.
Current ratio=current assets/ current liabilities
Total assets turnover ratioThe ratio calculated by dividing total deposits by total assets
Total deposits / total assets
3. Debt management Debt ratio =the ratio of total debt divided by total assets.
Debt ratio = total debt / total assets
Return on the total asset= net income divided by the total assets
5. Market Value-A set of ratio that relates the firms stock price to its
earning and book value per share.
(Am
ount
in
crore
taka)
inancial ratio
20
09
Industry Average
Liqui
dity
1.Current
ratio=current
assets/current
2008
Comment
0.11
4.1x
Low
0.17
Industry
average
comme
nt
4.1x
Low
200
7
0.08
Industry
Average
com
men
t
4.1x
Low
liabilities
Asset
Management
1.fixed assets
turnover=Total
deposits/Net
fixed assets
2.Total assets
turnover=total
deposits/total
assets
57.73
4.0x
High
58.02
4.0x
High
54.80
4.0x
High
0.78
2.1x
Low
0.78
2.1x
Low
0.72
2.1x
Low
Debt
Management
1.De
bt
ratio
Totald
ebt/tot
al
assets
1.87
4.50%
High/
ok
1.97
4.50
%
High
/Ok
1.80
4.50
%
high/
ok
0.038
4.70%
Low
0.043
4.70
%
Low
0.038
4.70
%
Low
0.030
12.60%
Low
0.03
12.6
0%
Low
0.028
12.6
0%
Low
Profit margin
on deposits
1.Profitability
margin on
deposits=Net
income/deposit
s
2.Return on
total asset=Net
income/total
asset
Mar
ket
Valu
e
1.Price/Earnin
gs=Market
price per
share/earnings
2.Market/Book
=Market price
per share/Book
value
70.84(ta
ka)
13.0x
High/
ok
14.26(
taka)
13.0
x
High
/ok
41.84(t
aka)
13.0
x
High/
ok
1.012
2.0x
Low
1.013
2.0x
Low
1.013
2.0x
Low
have online system. It is the poor management system of ABL. In IT section they have no
IT manager so IT performance is very poor, many employee have no skill about IT
section. So this is the reason that people cannot open account in ABL.
CHAPTER-7:
Recommendations and Conclusion:
7.1 Recommendation:
By identifying few of the previously mentioned problems during my internship, from the
SWOT analysis and Ratio analysis I would like to recommend some way to overcome
those problems. These are as follows:
7.1.1 On clearing & cleaning up the local remittance sections:
ABL should make a database to maintain their registry records in to the
Computer. So by only giving a search command they may find out their required
clearing information.
ABL should open their branches in the business area like near EPZ, port etc to
provide prompt services to importer and exporter.
Local L/C is not introduced in our society very much. ABL can give attention to
attract
local businessman for convincing them about local L/C.
Where computer leads every sphere of lives including banking activities most of
the
ABLs employees are still not expert on computer literacy. So for it, the
management
should give computer training to their employees.
They may make a database or search for other solution to prepare their debit and
credit voucher. As by adopting a better solution will make their work easier.
Prompt attention should be given to the FDR customers if the bank does not want
to lose new customers.
7.1.2
Agrani Bank should always monitor the performance of its competitors in the field of
foreign trade.
For customer's convenience in Foreign Exchange Department of Agrani Bank Ltd.
should provide more personnel to deliver faster services to their honorable customer.
To deliver quality service, top management should try to mitigate the gap between
customer's expectation and employee's perception.
The number of exporter and importer who operate through this bank is not enough to
achieve the goal. So ABL should offer more facilities to attract them to be their client.
Foreign exchange department should be fully computerized that the exchange process
would be convenient for both the bankers and the clients.
The Bank should give more concentration of foreign remittance to increase profit from
the remittance. Though the remittance performance of ABL for the last year (2012)
was very bad so the performance and profit should increase year by year.
Though the import and export business increased year by year, but the banks income
growth rate very much fluctuated during the last five years except year of 2012. So the
bank should try to sustain a constant growth rate.
The export business of the bank is on an increasing trend. So the bank should try to
keep the pace of growth.
Bank should try to increase earning from export. It should concentrate more effort to
improve export earnings and remittance earnings for our economy.
The import performance is little bit lower in the year of 2012 compared to others years,
so the bank should try to put more concentration for the amount of import.
The export earnings growth rate and import earning growth rate were very much
fluctuated during the last five years. So bank should try to keep a constant growth rate.
The number of human resources in the remittance department is really insufficient to
give services to huge volume of work. So, number of staff should be increased in this
department.
7.2 Conclusion:
Agrani Bank Limited is a leading Public bank in Bangladesh with superior customer
bases that are loyal, faithful, worthy towards the bank. The service provided by the young
energetic officials of the Agrani Bank Limited is very satisfactory. Form the learning and
experience point of view I can say that I really enjoyed my internship period in Agrani
Bank Ltd. at Jatiya Jadughar Branch from the very first day. I am confident that this 3
(three) months internship program will definitely help me to realize my further carrier in
the job market. During the course of my practical orientation, I have tried to learn the
practical banking to relate it with my theoretical knowledge, what I have gathered and
going to acquire from various courses.
Many new commercial banks have been established in the last few years and these banks
have made the banking sector very competitive. So, now the banks have to organize their
operation and do their operations according to the need of the market.
The major task for banks, to survive in this competitive environment is by managing its
assets and liabilities in an efficient way. As an internee student of Agrani Bank Ltd at
Hatkhola Branch, I have truly enjoyed my internship from the side of learning to the side
of experiences viewpoint. I am confident that three month internship program in Agrani
Bank Limited will definitely help me to realize career in the job market. But during my
intern period it was not much possible for me to go to the depth of branches sections
thoroughly because of the time limitations. Agrani Bank Limited (ABL) is one of the
widely expanded Banks in Bangladesh. Due to the threat of deposit shortage, this Bank
may minimize its different types of unnecessary expenditure and should maximize profit
through launching new schemes and obtain different peoples belief. I do also believe
that all of these will assist me further in my career build-up in the future.
ABL is committed to provide high quality financial service to contribute to the growth of
G.D.P. of the country through simulation trade and commerce, accelerating the pace of
industrialization, boosting up export, creating employment opportunity for the educated
youth, poverty alleviation, raising standard of living of limited income group and overall
sustainable socio-economic development of the country.
I also think that there is bright future waiting for the Agrani Bank Ltd. Near future ABL
will be a position to go as a catalyst for this development in the banking sector of
Bangladesh. Another thing I have to mention here that ABL is going through the path in
which they need to go as like today and it will bring more new and welfare oriented
activities in the banking sector in years to come.
Performance analysis of foreign exchange of a bank is not so sufficient to measure and
express perfectly within this short time of my internship period. But it is a great
opportunity for me to get used to with the operational environment of foreign exchange
business of ABL. I have tried by soul to incorporate the necessary relevant information in
my report.
At last I would like to conclude that as a student of BBA I had to undertake this training
program to fulfill the partial requirement of the BBA program. I have tried to the best of
my capacity to prepare and submit this report within a very short period of time. I am
highly pleased being able to make a report on this kind of program. If there is any kind of
error kind consideration is requested.
END NOTE: