Beruflich Dokumente
Kultur Dokumente
By
Towhidul Islam
An Internship Report
Submitted to the
Department of Business Administration
09 April, 2017
Financial Performance Analysis of NRB Global Bank Limited
Submitted by:
Towhidul Islam, Roll: 19
Batch: 41(B) Registration. no: 243099
Bachelor of Business Administration
Supervisors Name:
Fakhrul Islam
Assistant Professor
Department of Business Administration
09 April, 2017
26 April, 2017
Fakhrul Islam
Assistant Professor
Dear Sir,
With great pleasure, here I submit my internship report on Financial Performance of NRB
Global Bank Limited that you have approved & assigned as a compulsory of Internship course.
This report is based on the knowledge and experiences I have gained my internship period at
NRB Global Bank Limited. Hence, I would be extremely delighted and honored if you accept
my Internship Report and recognize my hard work and determination I have put together in the
preparation and completion of this report. I have tried my best to bring out the original scenario
of the Financial Performance with full of effectiveness & efficiency.
I would like to thank you for your support, guidelines & observation of my works which made it
easy for me as well as provided knowledge of learning in practical.
Sincerely Yours,
-------------------------------
Towhidul Islam
First of all I would like to express my gratitude to the Almighty Allah, whose invisible guidance
helped me to complete this report.
This report has not only gave me some invaluable experience, at the same time it has made me
indebted some extremely helpful and knowledgeable people. By working there as an intern I
have learnt so many things which are very valuable for me in future.
At first I want express my deep gratitude to my Academic Supervisor Mr. Fakhrul Islam.
Without whom this report would not be possible to accomplish. I am so honored to have him as
my supervisor who taught me about professionalism and empathy which are key factor in
corporate success.
Finally, I want to thank Mr. Shahriar Bahasty, Manager of NGBL, Ashulia Branch & Mr.
Mazedul Hoque, Operation Manager Ashulia Branch, for their constant support, guidance and
supervision for preparing the report.
And last but not the least; I would like to thank all the personnel working at NRB Global Bank
Ltd., Ashulia Branch. They made the environment congenial and favorable for me to understand
the task. Without their assistance and co-operation, this report might not have seen the light of
day.
I really enjoyed a lot every moments like internship period to prepare final report. I hope that it
will help me in my future professional work. Moreover I like to thank everyone who was helped
me for preparing this report.
Letter of Transmittal ii
Acknowledgement iii
Executive Summary ix
Chapter 1: Introduction 01
1.1 Introduction 02
1.2 Origin of the report 02
1.3 SIGNIFICANCE OF THE STUDY 03
1.4 Objective of the report 03
1.5 Scope of the report 04
1.6 Methodology 04
1.7 Limitation of the report 04
Chapter 2: Company Profile 05
2.1 About NRB Global Bank Limited 06
2.2 Chairmans message 06
2.3 Corporate Profile 08
2.4 Company Milestone 09
2.5 VISION 09
2.6 MISSION 10
2.7 GOAL 10
2.8 CORPORATE SOCIAL RESPONSIBILITY 10
2.9 Management of NGBL 11
2.10 PRODUCTS AND SERVICES 13
2.11 Interest Rate 14
2.12 PROFITABILITY IN RETAIL CREDIT OF NRBL 16
2.13 Interest rate of Retail Credit Facility of NGBL 16
2.14 SWOT ANALYSIS OF NGBL 17
Chapter 3: MY EXPERIENCE AND RESPONSIBILITY IN NGBL 20
This internship report is based on my internship program and financial statements of 2013, 2014 and
2015 of NRB Global Bank Limited. In my internship period, I worked in General Banking. It was a
great opportunity to experience and gather knowledge in different types of banking operations. My
faculty supervisor helped me to choose the topic- Financial Performance Analysis of NRB Global
Bank Limited.
In the new competitive business era, private banking sector is getting more competitive in
Bangladesh. In this sector the most used financial statements are the balance sheet and profit and loss
account where the balance sheet shows the financial position and profit and loss account shows the
net profit or net loss of a bank. Ratio Analysis deals with these statements.
Ratio analysis is the most popular trend to evaluate a banks performance over years or with other
companies in an industry. In my report I had to study Financial Performance Analysis of NRB Global
Bank Limiteds financial statements for the last three years then had to analyze and give significant
comments regarding the changes in the financial position. Analysis and interpretation of these
financial statements through ratio analysis has now become an important technique for performance
appraisal because the investors, financial experts, management executives and the bankers are always
rely on these ratios to make important decisions. The management team of any bank, investor and the
government agencies always concern about liquidity ratios and adequacy ratios of a bank which
interprets the efficiency of a bank.
As a part of my B.B.A. program, I have spent 12 weeks in Financial Performance Analysis of NRB
Global Bank Limited, Ashulia Branch learning the activities of general banking. I have analyzed the
financial statements of Financial Performance Analysis of NRB Global Bank Limited to find out its
ratios by using its past and current records. After preparing this report I came to know that analysis of
financial statements through ratios helps to overcome the past flaws and make the future decisions
and strategies. Therefore, it is very necessary for every organization whether the companys size is to
make financial statement and to analyze it by ratios.
Generally by the word bank we can easily understand that the financial institution dealing with
money. The whole scenario of the economy of a country can be ascertained by examining the
condition of the banking sector. Banking sector has a vital role to play in the economic activities and
development of any country. There are different types of banks like Central Banks, Commercial
Banks, Savings Banks, Investment Banks, Industrial Banks, and Co-operative banks etc. But when
we use the term bank without any prefix or restriction, it refers to the Commercial Banks.
Commercial Banks are the primary contributors to the economy of a country like Bangladesh. In
Bangladesh, the commercial banks are dominating the financial sector and macroeconomic
management largely depends on the performance of the commercial banks as well as banking sector.
Banking grew primarily in the public sector with main emphasis on restructuring of the financial
system and development needs of the war-torn economy with gradual liberalization in subsequent
years. It was increasingly felt that banks should be allowed in the private sector for giving a fillip to
development process on the basis of private initiative. In the 80s for the first time a number of banks
in the private sector were allowed.NRB Global Bank is one of them. Today the banking concept is
not continuing inside the branches or the cabin of the branches. The bankers are now practicing the
non-cabin banking. The assurance of the availability of the service provider is main factor in bank
service. As a result, it has become essential for every person to have some idea on the bank and
banking procedure. At present, there are 57 scheduled banks operating all over the country. Out of
these, 9 are state-owned (including five specialized banks), 39 are private commercial banks and the
rest 9 are foreign commercial banks.
Even though banking sector in Bangladesh is going through a radical change, it still suffers from
chronic inefficiency. The biggest problem of Bangladesh banking system is the bank loan default
problem. Various initiatives have been undertaken to tackle the loan default problem in Bangladesh.
One of them is to have a credit policy and procedures guideline mandated by the Bangladesh Bank.
Internship Program of Dhaka International University is a Graduation requirement for the BBA students,
which is also a partial requirement of the Internship program of BBA curriculum. The main purpose of
internship is to get the student exposed to the job world. Being an intern the main challenge was to
translate the theoretical concepts into real life experience. The internship program and the study have
following purposes:
To compare the real scenario with the lessons learned in the University
This report is prepared to give a concrete idea about the performance and the condition of NGBL
over last three years. I believe that my report will help a lot those who want to get an overall idea of
NGBL as well as its financial statement. Bank management also can be using the information of my
observation for their managerial decision if needed.
General Objective
Specific Objective
To provide a brief overview of NRB Global Bank and their historical background.
To analyze the financial performance of NRB Global Bank Limited in the last three years. (2013-2015)
To identify the strength and weakness of bank based on the financial performance in the last three years.
(2013-2015).
.
1.6 Methodology
In order to generate this report primary and secondary data have been used. The source that have been
used to gather and collect data is given below-
Newspaper
Web site
It was a great opportunity for me to work in NRB Global Bank Limited as an Intern and a make a report
on the financial performance of it but there were surely some limitations while making this report. They
are-
Getting the information and interpreting it, on the basis of my understanding and then implementing it.
Bankers are very busy people. I tried to contact with some high officials for more detailed information
and consultation but they could not manage time for me.
In the era of Globalization, no one can survive alone. Modern Technology and foreign policies have
brought the people of the world very close to each other. At present, this world is a global village. Now,
the communication among people is very faster than any previous time. Connectivity is very crucial in
this village. So, Bangladesh cannot live alone in this fastest growing village.
Keeping all these in mind, Bangladesh Bank approved nine banks as fourth generation banks in which,
three banks have the funding of non-resident Bangladeshi (NRB) people. NRB Global Bank Limited is
one of those three banks to materialize the dream of people having the goal to keep Bangladesh well
connected with other advanced nations. It is the brainchild of 25 (twenty five) well reputed visionary
Non-Resident Bangladeshi (NRB) people residing in different countries of the world. It has been
approved by the regulatory bodies in 2012 to operate business in banking of Bangladesh.
After hard labor of almost three years complying with all regulatory rules and regulations, it has got the
final approval on July 25, 2013 from the regulatory body to run the banking business in Bangladesh.
Gradually, the mentioned brainchild of those NRBs has become the reality. Head office of this bank has
already been formally inaugurated on September 09, 2013. Its head office is situated at Khandker Tower,
94 Gulshan Avenue, Gulshan 1, Dhaka 1212, which is a great example of post modern structure and one
of the finest buildings in Bangladesh. Even, this bank has opened its first branch at the same premise on
October 23, 2013.
Mr. Nizam Chowdhury is the founding Chairman of this bank having a long professional experience of 26
(twenty six) years in the U.S.A and other Directors are also well reputed in their own sectors of business.
These nice personalities have well defined mission and vision. Their mission is not to restrict NRB Global
Bank Limited to a particular group of people but to bring the huge unbanked people under banking. Their
vision is to make NRB Global Bank Limited truly global providing world class services throughout the
world.
It was our dream to establish a bank for the economic development of my motherland with the help of
Bangladeshi expatriates residing in different countries of the world. Finally, the dream has an existence
now, which is NRB Global Bank Limited. We have started our journey with the desire to serve the
people at home and abroad with the latest technology and improved banking services. We want to make
the banking a great experience, which is our motto. We want to contribute in the economic
development of Bangladesh significantly. Approximately 55% of total population in Bangladesh has
come under banking even after four decades. So, the maximum portion is still far away from banking. Our
mission is to reach them with improved services bringing them under banking.
It seems that many Non-Resident Bangladeshi (NRB) people are little confused to invest in Bangladesh
although they have huge fund to do so. NRB Global Bank Limited is assuring them about their
investment in Bangladesh, which will create huge employment opportunities. This bank has started its
NRB Global Bank Limited has been established to meet up the local demand using the foreign remittance
sent by the NRBs, who are working very hard in abroad. This bank is to safeguard the depositors money
as the custodian and also to return it to them with a better value. Keeping all these in mind, I, along with
some renowned NRBs, with the due approval of the regulatory bodies, established NRB Global Bank
Limited to become the pioneer leading from the front in the economic development of Bangladesh. This
bank is providing timely, efficient & innovative banking services with its well-equipped employees and
also trying heart and soul to fulfill its shareholders desire.
NRB Global Bank Limited has a credit policy to give its customers world class services at the earliest. It
will lend money after having zero confusion. We are not to compromise with our services, which will
give our customers a great experience.
In order to keep up the trend of banking, NRB Global Bank Limited is going to introduce wide range of
ATMs, Mobile Banking, Internet Banking, Credit & Debit cards etc within the shortest possible time. We
are very aware to reach our customers throughout home and abroad with wide range of branches. We also
wanted to open branches in such a way that we can follow the Bangladesh Banks 1:1 branch policy as
well as assure banking for those approximately 45% unbanked population. Moreover, we have an unique
culture and different modes of banking to satisfy our customers.
We are not looking at making profit only; we are to serve the society. Our CSR activities will be done in
such a way so that it will cover maximum portion of people in the undeveloped society.
I thank all the Board members for keeping their trust on me and also for their accompany in this journey
and their support throughout as well. I am also grateful to Bangladesh Bank for their proper guidance. I
am thanking the employees of this bank for their continuous and relentless hard work giving our
customers a great experience. Finally, I want to assure our valued clients that they will get the best
possible banking services at home and abroad with our honesty, integrity, efficiency and dedication.
Nizam Chowdhury
Registered Office
Managing Director
Khandker Tower
Mr. Proshanta K. Halder
94 Gulshan Avenue
Legal Form
Total Assets
Public Limited Company
Tk. 7,490.39 Million
Date of Incorporation
Authorized Capital
21 July, 2013
Tk. 12,000.00 Million
Network
Paid-up Capital
Total Number of Branches: 37
Tk. 4,250.00 Million
Total Number of ATMs: 30
Bank Website
Auditors
www.nrbglobalbank.com
Hoda Vasi Chowdhury & Co.
Particular Date
Consent from BSEC for raising Paid up Capital July 07, 2013
License from Bangladesh Bank for Head Office July 25, 2013
License from Bangladesh Bank for Gulshan Corporate Branch October 10, 2013
2.5 VISION
To become exceptional brand in the financial sector by offering service excellence and creating value for
everybody encompassing customers, shareholders, partners, society and economy through transparency,
2.7 GOAL
NRB Global Bank has been conscious about corporate social talented young people and also to give them
a responsibility from the very beginning of its operation in 2013. The fair chance because education is the
most Bank looks beyond short-term quantitative gains and concentrates on important resource for
ensuring the future of issues which make the financial institution socially responsible and societies. Thus
expects a sustainable balanced growth.
Corporate Social Responsibility (CSR) is a big buzzword in todays corporate world. We often confuse
charity with CSR and indulge in numerous activities in the name of CSR. Lately, there has been a
tendency towards mixing up CSR with Corporate Governance as well. The word CSR is more than just
corporate philanthropy or charity. Today, Corporate Social Responsibility goes far beyond charity. It is
not just making a contribution to good causes or a charitable organization but a year-round responsibility
that companies should discharge to serve the community and each other. It must integrate corporate
values, culture and strategy and at the same time, contribute to sustainable social progress. NRB Global
Bank considers Corporate Social Responsibility (CSR) as the main pillar of corporate value and growth.
As a part of our business strategy, we have clearly identified key initiatives with a medium-to long-term
perspectives and are working to take specific measures in each area. On the basis of this policy, NRB
Global Bank seeks to put into practice and commitments it has made to clients, shareholders, employees
and communities through its daily business activities and variety of activities that give back to society. In
these and other ways, we seek to do business in ways that reflect of management philosophy. The Bank
5.50% 5.00%
b) 1.0 (one) crore & above to less than 25.0 crore 5.50% p.a 4.00% p.a
TK. 666.67 per 1 lac (B.T)* TK. 666.67 per 1 lac (B.T)*for 6, 9 & 12 months.
Profitability of a bank is mainly depends on the loans of that bank. More specifically, how efficiently the
banks are utilizing their assets in another term the loans. Banks are not only always looking for their
profits but also need to careful about the risk of those loans. Their Ashulia branch is very much successful
from that perspective. The financial statement of NGBL Ashulia branch indicate that their provisions for
bad debts in this year is (as of 31 December 2016) Tk. NIL. Therefore, this is satisfactory as of the
consideration of the branch location and Loans volume. Now before going to the details about the
profitability of the Retail credit facility of the NGBL Ashulia branch; I would like to discuss about the
credit portfolio of the NGBL.
Highest amount of interest will give highest amount of profit. But as the banking system of Bangladesh is
not the monopoly business system so banks must have to maintain competitive interest rate with other
banks. If we follow the practice of retail credit system in Bangladesh then we will see highly competitive
interest rate among the banks. Every times the banks are offering various types of loans according to the
needs of the customer with an aggressive interest rate. NGBL has also designed their products feature
such a way so they can compete with other banks. The effective interest rates of different Retail credit
facility of NGBL are given billow
Interest Rate
16%
15% 15% 15% 15% 15% 15% 15% 15% 15%
15%
14% 14%
14%
SWOT analysis is a strategic planning method used to evaluate the strengths, weaknesses, opportunities,
and Threats involved in a business venture. In banking sectors it is important to identify the internal and
external factors that are favorable and unfavorable to achieve its objectives. From the SWOT analysis we
can figure out ongoing scenario of the bank. So to have a better view of the present banking practice of
NGBL, the SOWT analysis of NGBL is given below
WEAKNESS
SWOT OPPORTUNITI
STREGTH
ANALYSIS ES
THREATS
It is an internal factor. It deals with the organizations own strength. NGBLs strengths are
Efficient administration
2.14.2 WEAKNESS
Opportunities are external factors which indicate the industrys advantages available for the
companies.
2.14.4 THREATS
Threats are external factors of SWOT analysis. The threats for NGBL are
I was appointed as an internee in NRB Global Bank Ashulia Branch from the date of 15th January to
15thApril and I have worked there for three months. I worked there in almost all desks under the
supervision of my on field supervisor Mr. Shahriar Bahasty. In branch the desks I had to cover is given
below in diagram.
My Internship
Training
General General
Advance Banking
Figure-5: MY EXPERIENCE
To work in a branch of NGBL I have enriched my knowledge through relating my theoretical knowledge
with practical observations. The responsibilities and experience that I have gathered by working in
different departments are given below.
I started my internship program from the general banking department where I have the opportunity to
observe the cash management procedures, account opening procedures and the procedures of on-line
banking operations and bill and remittance. General banking is a vast department which includes a large
number of operations
CASH
MANAGEM
ENT
GENERA
ACCOUNT L BILLS AND
REMITTAN
OPENING BANKIN CE
G
CHEQUE
CLEARING
Cash management is one of the most important parts of general banking because banks main business is
to manage the cash by receiving cash form customers and paying cash to customers. As it is the most
sensitive part of bank, here I have got minimum responsibilities to do. In this department I got a great
opportunity to enrich my knowledge
Bills and remittance department is the most busy department where bills and remittances are issued which
the most liquid form after cash. In this department I have learnt how to issue the payment order, demand
draft and the collection of DD, outward bill collection (OBC) and internal bill collection (IBC) etc.
Cheque clearing (or check clearing in American English) or bank clearance is the process of moving a
cheque from the bank in which it was deposited to the bank on which it was drawn, and the movement of
the money in the opposite direction.
Financial statement Analysis involves a comparison of a firms performance with that of other firms in
the same line of business, which usually is identified by the firms industry Classification. Generally
speaking the analysis is used to determine the firms financial position so as to identify its current
strengths and weakness and to suggest action the firm might pursue to take advantage of the strength and
correct any weakness.
The main objective of the project is to analyze the financial performance of NRB Global Bank Limited in
the last three years (2003-2015) by using ratio analysis. So that, I can identify the strength and weakness
of bank based on the financial performance in the last three years (2003-2015) and present my
observation and suggestion to the bank.
Mainly here I want to show a vivid picture of financial performance of NRB Global Bank Limited and for
this reason it is necessary to know how NRB Global Bank is performing through any specific financial
performance analyzing tool. Since I have already mentioned about the background of NRB Global Bank
Limited so now to evaluate performance I have gone through ratio analysis which will help to make
proper evaluation. Basically for analysis I have chosen some ratios and gather the information to calculate
the ratios from income statement and balance sheet for last three years. Lastly I have interpreted the result
and recommended where the improvement might take place.
Core deposit ratio is the ratio of core deposits to total assets. Core deposits are primarily small
denomination accounts from local customers that are considered unlikely to be withdrawn on short notice
and so carry lower liquidity requirements. NRB Global Banks core deposit ratio is given below.
Core deposit ratio increased over the period of three years. It increased from 3.92% in 2013, to
11.35%
12.00%
10.00% 8.15%
8.00%
6.00% 3.92%
4.00%
2.00%
0.00%
2015 2014 2013
The higher the core deposit ratio, the better for the bank. So the core deposit ratio has improved for NRB
Global Bank over the years, improving its liquidity position. The continuous growth of the ratio can be
attributed to a steady growth in core deposits (DPS) over the period of three years.
Deposit composition ratio is the ratio of demand deposits to time deposits, where demand deposits are
subject to immediate withdrawal by check writing, while time deposits have fixed maturities. It measures
how stable a funding base, the bank possesses. NRB Global Banks deposit composition ratio is given
below.
Deposit Composition Ratio = {(Current Accounts & Other Accounts+ Savings Bank Deposits)/
Term Deposits} x 100
Demand deposits include savings accounts and current accounts, while time deposits include all fixed
term accounts. The deposit composition ratio increased from 4.57% in 2013 to 6.49% in 2014 to 7.35% in
2015.
7.34%
8.00%
6.49%
7.00%
6.00% 4.57%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
2015 2014 2013
The lower the deposit composition ratio, the better it is. In 2013, the ratio worsened for a considerable
increase in demand deposits, which affected the banks liquidity position but the ratio improved for NRB
Global Bank from 2013 to 2015.
Cash position indicator is the ratio of cash and deposits due from depository institutions, to total assets,
where a greater proportion of cash implies the bank is in a stronger position to handle immediate cash
needs. NRB Global Banks cash position indicator is given below.
100.00%
90.00%
80.00%
70.00%
60.00%
50.00% 90.84%
80.93%
40.00%
58.32%
30.00%
20.00%
10.00%
0.00%
2015 2014 2013
The higher the cash position indicator, the better it is. Consequently, NRB Global Banks cash position
was not that good in 2013. It improved significantly in 2014 then 2015.The improvement in 2014 was
caused by a massive increase in deposits, while the deteriorations in 2014 & 2015 were caused by big
changes in total assets.
Capacity ratio is the ratio of net loans and leases to total assets. It is a negative liquidity indicator, because
loans and leases are often among the most illiquid assets that a bank can hold. NRB Global Banks
capacity ratio is given below.
Capacity Ratio
66.33%
70.00%
60.00% 55.94%
50.00%
40.00%
30.00% 34.41%
20.00%
10.00%
0.00%
2015
2014
2013
The lower the capacity ratio of a bank, the better it is. It was worse in 2013. From then, it improved in
2014 and 2015. Improvements in the capacity ratio can be attributed to a comparatively faster growth in
total assets than total loans and advances, and vice versa.
Tier 1 capital is also known a core capital. It includes par, surplus, undivided profit, minority interest, all
provisions and preferred stock.
Tier 2 Capital
Tier 2 capital is also known as supplemental capital. It includes all provisions, subordinated debentures,
convertible bonds, intermediate terms preferred stock, and perpetual preferred stock, equity capital.
Comparison Year
1,500,000,000
1,000,000,000
500,000,000
0
2015 2014 2013
As Tier 2 capital is a function of all provisions. So, wherever total provisions increases Tier 2 capital
increases if it decreases Tier 2 capital also decreases. However, in comparison to its core capital, NRB
Global Bank has a considerably weaker supplemental capital base. So it needs to review its Tier 2 capital
policy.
The RAP bank capital, as defined by the Regulatory Accounting Principle includes common stock,
undivided profit, equity reserve, preferred stock, all provisions, subordinated debenture and minority
interest. NRB Global Banks RAP capital is given below.
4,239,242,335 4,149,338,409
2015
2014
2013
4,164,592,483
The banks RAP capital decreased over the period of Three years. It fall from 4,239,242,335 in 2013, to
4,164,592,483 in 2014, to 4,149,338,409 in 2015.
The book value of bank capital, as defined by the Generally Accepted Accounting Principles includes par,
surplus, undivided profit and all provisions. NRB Global Banks GAAP capital is given below.
The banks GAAP capital decreased over the period of Three years. It fall from 4,239,242,335 in 2013, to
4,164,592,483 in 2014, to 4,149,338,409 in 2015
Leverage ratio is the proportion of capital base to total assets that is required to be held by the bank,
according to the Basle Act. NRB Global Banks leverage ratio is described below.
Leverage Ratio
60.00%
56.54%
50.00%
40.00%
30.00%
13.20% 22.76%
20.00%
10.00%
0.00%
2015
2014
2013
From 2010-2013, the NRB Global Bank was well capitalized, as the ratio was above 10%. In general, the
banks leverage ratio shows a sound capital base, in proportion to total assets.
Liquidity ratios are calculated to find out the liquidity position of an organization. Liquidity means ability
to pay as and when some obligations are due. Liquidity is the life blood of any business organization
because lack of liquidity can bring bankruptcy situation for the organization. For calculating liquidity
ratios, current assets and current liabilities are used. Generally, the higher the liquidity ratios are, the
higher the margin of safety that the company possesses to meet its current liabilities. Liquidity ratios
greater than 1 indicate that the company is in good financial health and it is less likely to fall into financial
difficulties. Liquidity ratios consist of cash ratio, loans to total deposit and loans to total asset.
It is the ratio of a company's total cash and cash equivalents to its current liabilities. The cash ratio is most
commonly used as a measure of company liquidity. It can therefore determine if, and how quickly, the
company can repay its short-term debt. A strong cash ratio is useful to creditors when deciding how much
debt, if any, they would be willing to extend to the asking party.
The cash ratio was 0.58% in 2013 then it increased to 0.98% in 2014 but it decreased again to 0.78% in
2015.
Cash Ratio
1.20%
1.00% 0.98%
0.80% 0.78%
0.60% 0.58%
0.40%
0.20%
0.00%
14-08-1322-11-1302-03-1410-06-1418-09-1427-12-1406-04-1515-07-1523-10-1531-01-1610-05-16
The fall of 2015 and 2013 can be attributed to the growing loans and deposits given and accepted by the
bank. Growing loans make the cash in hand and at banks smaller, while growing total deposits made the
denominator of the cash ratio larger, thereby making the numerical figure of the ratio smaller. The growth
rate of both deposits and credits fell in 2015 but in 2014 cautious investments increased cash in hand and
at banks, while a small increase in deposits made the cash ratio grow when compared to the previous
years.
This is a commonly used statistic for assessing a bank's liquidity by dividing the banks total loans by its
total deposits. This number, also known as the LTD ratio, is expressed as a percentage. If the ratio is too
high, it means that banks might not have enough liquidity to cover any unforeseen fund requirements; if
the ratio is too low, banks may not be earning as much as they could be. These ratios are used to
determine whether a bank will be allowed to open or acquire a branch outside of its home state, and this
ratio is often used by policy makers to determine the lending practices of financial institutions.
The loans to total deposit ratio was 81.22% in 2013, decreased to 73.62% in 2014, then increased to
78.11% again in 2015.
Loans to Deposit
81.22%
82.00%
80.00% 78.11%
78.00%
76.00% 73.62%
74.00%
72.00%
70.00%
68.00%
2015 2014 2013
The loans to assets ratio measure the total loans outstanding as a percentage of total assets. The higher
this ratio indicates a bank is loaned up and its liquidity is low. The higher the ratio, the more risky a bank
may be to higher defaults. It is a commonly used statistic for assessing a bank's liquidity by dividing the
banks total loans by its total assets.
The loans to total asset ratio was 34.41% in 2013 & 55.94% in 2014, and slightly increased to 66.33% in
2015.
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
2015 2014 2013
Credit risk ratios are used to calculate the financial leverage of a company to get an idea of the company's
methods of financing or to measure its ability to meet financial obligations. There are several different
ratios, but the main factors looked at include debt, equity, assets and interest expenses. It measures the
credit risk of the company in terms of its dependence on debt financing versus equity financing. Credit
risk ratios include equity to asset, equity to net loans and debt to equity.
The equity ratio is a financial ratio indicating the relative proportion of equity used to finance a
company's assets. It is used to help determine how much shareholders would receive in the event of a
company-wide liquidation. The ratio, expressed as a percentage, is calculated by dividing total
shareholders' equity by total assets of the firm, and it represents the amount of assets on which
shareholders have a residual claim. The figures used to calculate the ratio are taken from the company's
balance sheet.
The ratio follows a more or less cyclical trend from 2015 to 2013 with peaks in 2013 and dips in 2014 and
2015.
56.54%
60.00%
50.00%
40.00%
30.00% 22.83%
20.00% 13.40%
10.00%
0.00%
2015 2014 2013
The ratio was 56.54% in 2013, 22.83% in 2014, and 13.40% in 2015. In 2013 however, equity to
asset shot up to an unprecedented level that is 56.54%. The increase was caused solely by the
increase in owners equity.
This ratio forms part of the Capital and Funding ratios of a bank, and measures a company's financial
leverage by calculating the proportion of equity and debt the company is using to finance its assets. Total
equity covers total equity reserves, total share capital and treasury stock. Net loans include loans to banks
or credit Institutions, customer net loans and loans to group companies.
20.20%
2015
75.97% 40.81%
2014
2013
It was 20.20% in 2015, 4.81% in 2014 and rose to 75.97% in 2013. The fluctuations in the ratio from
2013 to 2015 can be explained by changes in the manner of financing. Both the total equity and net loans
increase in 2011 which results in greater equity to net loans ratio. But in 2015 the net loans increased
significantly which took the ratio down.
They are also known as asset management ratios or efficiency ratios and is used to judge the efficiency in
management of assets. Assets are employed to generate sales for a firm and these ratios determine how
well the asset is utilized to efficiently generate or convert asset into sales. High asset turnover ratios are
desirable because they mean that the company is utilizing its assets efficiently to produce sales. The
higher the asset turnover ratios, the more sales the company is generating from its assets. It consists of
fixed asset turnover and net asset turnover.
Fixed Asset Turnover Ratio calculates the value of revenue achieved per dollar of investment. The fixed-
asset turnover ratio measures a company's ability to generate net sales from fixed-asset investments -
specifically property, plant and equipment (PP&E) - net of depreciation. A higher ratio indicates better
asset management and utilization and vice versa.
The fixed asset turnover was 414.55% in 2013. Then it decreased drastically to 294.35% in 2014, rose
again to 587.50% in 2015.
600.00% 587.50%
500.00%
400.00%
414.55%
300.00% 294.35%
200.00%
100.00%
0.00%
2015
2014
2013
An unprecedented increase in fixed assets was responsible for this trend. While revenue only increased by
15.35% from 2010 to 2011 and, fixed assets increased by 76.13% for the same period and the same thing
continues for 2012 & 2013. A possible reason for the increasing value of fixed assets was raising
inflation. Inflation rates rose from 5.43% in 2009 to 10.7% in 2011. This meant that the new assets
bought and recorded from 2010-11 were recorded at a higher value, increasing the amount of fixed assets
exponentially.
The net asset turnover ratio measures the ability of management to use the net assets of the business to
generate sales revenue. A well-managed business will be making the assets work hard for the business by
minimizing idle time for machines and equipment. Too high a ratio may suggest over-trading, that is too
much sales revenue with too little investment. Too high a ratio may suggest under-trading and the
inefficient management of resources.
10.00%
9.00%
8.00%
7.00%
6.00%
9.95%
5.00%
7.84%
4.00%
3.00%
2.00% 2.49%
1.00%
0.00%
2015 2014 2013
The upward trend of net asset turnover, which started from 2013 and continued till 2015, can be explained
by the increasing of net assets, the rate of which is substantially greater than the rate of growth in revenue.
Rapidly growing fixed assets increased net assets, thus bringing down net asset turnover.
ROA is an indicator of a companys profitability. ROA is calculated by dividing a companys net income
in a fiscal year by its total assets. It is known as a profitability or productivity ratio, because it provides
information about the management's performance in using the assets of the small business to generate
income. ROA can be used as a valuable tool to measure progress against predetermined internal goals, a
certain competitor, or the overall industry. ROA is also used by bankers, investors, and business analysts
to assess a company's use of resources and financial strength.
Return on Year
Asset
2015 2014 2013
Return On Asset
0.07%
0.06% 0.06%
0.05%
0.04%
0.03%
0.02%
0.01%
0.00% 0.00%
0.00%
22-11-13 02-03-14 10-06-14 18-09-14 27-12-14 06-04-15 15-07-15 23-10-15 31-01-16 10-05-16
-0.01%
-0.02%
This ratio shows the amount of net income returned as a percentage of shareholders equity. Return on
equity measures a corporation's profitability by revealing how much profit a company generates with the
money shareholders have invested. It indicates a firm's efficiency in applying common-stockholders'
(ordinary-shareholders') money.
Return on Year
Asset
2015 2014 2013
This ratio shows the amount of net income returned as a percentage of total deposits. Return on deposit
measures a corporation's profitability by revealing how much profit a company generates with the money
savers have kept in the bank. It indicates a firm's efficiency in applying deposits (liabilities) to earn profit.
Return on Year
Deposit
2015 2014 2013
0.00%
2015 2014 2013
-0.10%
-0.20%
-0.30%
-0.40%
-0.50%
-0.60%
Interest spread is the difference between the average yield a financial institution receives from loans and
other interest-accruing activities and the average rate it pays on deposits and borrowings. The net interest
rate spread is a key determinant of a financial institutions profitability (or lack thereof).
Interest Spread
7.50%
8.00%
6.53%
7.00%
6.00% 5.15%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
2015 2014 2013
While working at NRB Global Bank. Ashulia Branch, I have attained to the newer kind of experience.
After the collecting and analyzing of data I have got some findings. These findings are completely from
my personal point of view. Those are given below.
ased on my experience, it can be said that NRB Global Bank should reconsider its services that better
satisfy customer needs and requirements Bank should be more tactful in dealing with the customers and
launch new products that fully meet customer expectations.
uccessfully stepped in to the 4th year of operations having enjoyed the complete confidence
of the depositors and achieving significant growth in the entire areas of banking operations.
osophy to workout best solutions for customers and clients as a business and
customer friendly Bank.
The interest spread was5.5 % in 2013 & 7.5% in 2014 due to an increase in the Loans & decrease in
Deposit.
ll in net profit in first two year was caused by newer experience in banking sector than other
commercial bank.
urnover, which started from 2014 and continued till 2013, can be
explained by the increasing of net assets, the rate of which is substantially greater than the rate of growth
in revenue. Rapidly growing fixed assets increased net assets, thus bringing down net asset turnover. In
2014 it increased by 4.59% but it was poorer than 2013.
From 2013-2015, the NRB Global Bank was well capitalized, as the ratio was above 10%.
Undoubtedly banks play crucial role in the economic development of a country. In addition, the
popularity of banks is increasing day by day which leads to increase competition as well. The
working experience is quite exciting at NRB Global Bank, Gulshan Corporate branch. I gathered
the experience of actual professional environment. Retail banking, investment and also the
foreign exchange operations is very convenient banking tool for the business world as the value
of these service is vast. All these services have gathered such a position in the banking sector that
people in developed and also developing counties are very much dependent on banking service.
In Bangladesh credit facilities or loans started to become very attractive in recent periods. But
still lot of improvements in services and facilities has to be made in this department. NRBGB is
engaged with general banking activities with a view to expand banking services to the clients.
All the employees of this bank are very qualified and dedicated, who are always trying to
provide the best service to the customers. In this bank the employees are highly motivated due to
their remunerations and other benefits. Here, all the employees are very much cooperative with
their customers, colleagues and visitors. To sum up, I want to say that I am very lucky to join
here as an internee because I always get support and motivation to assemble knowledge from
NRB Global Bank.
Some recommendations based on the financial performance of NRB Global Bank Limiteds financial
performance are given below-
-term loan a bank should consider that whether a bank has long term deposit or not.
Otherwise the bank will surely face the liquidity problem.
increase the non-funded income in order to increase the operating income ratio.
To prepare this report I have collected data mainly from annual reports of NRB Global Bank Limited,
different books regarding ratio analysis, the websites of Bangladesh Bank and NRB Global Bank Limited
and others websites about ratio analysis. The references are given below:
Annual Reports
Annual Report of NRB Global Bank Limited 2014
Annual Report of NRB Global Bank Limited 2015
Financial Statements
Financial Statement 2013
Financial Statement 2014
Financial Statement 2015
Web sites