Romel Vai
Romel Vai
Romel Vai
Bank Limited
IBAIS UNIVERSITY,DHAKA,BANGLADESH
Internship
Accounting information system of National
Bank Limited
SUBMITTED BY:
SUBMITTED TO:
Coordinator, BBA Program
Supervisor:
1 Introduction....................................................................................................................
1.1 Origin of Report..........................................................................................................
1.1.1 Methodology of Study.....................................................................................
1.1.2 Sources of Data...............................................................................................
1.2 Objective of the Study.................................................................................................
1.3 Rational of the Study..................................................................................................
1.4 Scope of the study.......................................................................................................
1.5 Limitations of Study...................................................................................................
2 An overview of National Bank Ltd.................................................................................
Primary data are that information which is collected for the specific
purpose of hand. Primary data was collected from the following sources:
Observation
Projection Techniques
Depth Interviews
Secondary data was that information that already exists somewhere having
been collected for another propose collect of secondary data. The following are
some of the sources we have usual.
Websites
Different articles
Annual Report
Prospectus
Personal investigation.
There were some confidential files where I did not get access.
2 An overview of National Bank Ltd
Virtually all banking services were concentrated in urban areas. The newly
independent government immediately designated the Dhaka branch of the State
Bank of Pakistan as the central bank and renamed it the Bangladesh Bank. The
bank was responsible for regulating currency, controlling credit and monetary
policy, and administering exchange control and the official foreign exchange
reserves. The Bangladesh government initially nationalized the entire domestic
banking system and proceeded to reorganize and rename the various banks.
Foreign-owned banks were permitted to continue doing business in Bangladesh.
The insurance business was also nationalized and became a source of potential
investment funds. Cooperative credit systems and postal savings offices handled
service to small individual and rural accounts. The new banking system succeeded
in establishing reasonably efficient procedures for managing credit and foreign
exchange. The primary function of the credit system throughout the 1970s was to
finance trade and the public sector, which together absorbed 75 percent of total
advances.
There was a major policy shift in early 1980s when private sectors banks
were allowed in the country. In addition to the existing 19 public sector and
foreign banks, 10 new private banks opened their business during early 1980s.
Thereafter, another 7 and 13 banks started commercial banking in the country
during mid-1990s and early 2000s respectively.
2.1.1 Structure
Currently, the banking sector comprises of 4 nationalized commercial
banks (NCBs), 5 government-owned specialized banks (SBs) dealing with
development finance in specialized sectors, 30 private commercial banks (PCBs)
and 10 foreign commercial banks (FCBs). The structure of the banking sector as of
December 2008 is shown in the following Table.
The structure of the banking system has changed substantially over the last
few years. NCBs’ role has gone down. Their share in total assets went down from
54 percent in 1998 to 40 percent in 2008. On the other hand, PCBs’ share went up
from 27 percent in 1998 to 43 percent in 2008. The change reflects adoption and
implementation of new policies for the banking sector.
2.4 VISION
Ensuring highest standard of clientele services through best application of
latest information technology, making due contribution to the national economy
and establishing ourselves firmly at home and abroad as a front ranking bank of
the country have been our cherished vision.
Integrity
Open Communication
Performance Driven
Quality
Teamwork
NBL as the first and largest private bank in committed to continue its
vendor by rapidly increasing the investment of honorable shareholders
into assets.
NBL has been working from its very beginning to ensure the best use of
its creativity, well-disciplined, well management and perfect growth.
M G Mortaza Chairman
A M Nurul Islam Member
Salim Rahaman Member
The sponsor directors paid 50% of the paid up capital while Bangladesh
Government and members of general public paid 5% and 45% of the paid up
capital respectively.
The board establishes the objective and policies of the bank. The boars has
the authority to declare dividend, to approve organization amend balance sheet etc.
The position of the chairman of the board carries with it a great deal of dignity and
respects in banking circles. The chairman
In Charge/ is responsible for keeping the board in
manager (SVP)
formed on the progress of the bank2 and in turn implements the policy established.
nd
Officer (AVP)
Clearing2.9.2 Management
Cash In Charge Acc Opening Foreign Loan & Deposit in Acct Section
(PO) Remittance
Asst. Officer (JO) Exchange Advance Charge (POPO) (SO)
The managing director (MD)
Foreign of the NBL is the Chief Executive of the
Payment (Asst Exchange Remittance Loan &
Deposit (JO)
O) bank. His duty is numerous. He is responsible
(PO) for administrating
Advance (PO) the business
Asst Officer
Foreign
affaires of the bank. He is also concerned
Receive (Asst Exchange withRemittance
planning and
Loanits
& implementation.
Deposit (SO)
O) (PO) Advance (PO)
The managing director also represents
Officer the bank to the meeting & response to the
various inquiry of the board of directors. The managing director maybe appointed
Receive (JO)
on contractual basis for certain period or maybe promoted from among the deputy
Payment (JO)
managing director for certain period. Under the leadership of the managing
director, there are three (03) managing Deputy Managing Director (DMDs) sixteen
(16) divisions are found in NBL, each division is lead by either an executive Vice
President (EVP) or Senior Vice President (SVP) or Vice President (VP).
CHAIRMAN
MD
AMD
DMD
SEVP
EVP
SVP
VP
Senior Assistant VP
Assistant VP
SPO
Principal Officer
Senior Officer
Officer
Provisional Officer
Board Secretariat
Credit Division-1.
Credit Division.-2.
International Division.
Marketing Division.
Protocol Division.
Reconciliation Division.
Overdraft
Letter of Credit
Packing Credit
Advance under ‘Red Clause Letter of Credit’
Back-to-Back Credit
Export cash credit
Since the very beginning, the Bank exerted much emphasis on overseas
operation and handled a sizeable quantum of homebound foreign remittance. The
Bank established extensive drawing arrangement network with Banks and
Exchange Companies located in important countries of the world. Expatriates
Bangladeshi wage earners residing in those countries can now easily remit their
hard-earned money to the country with confidence, safety and speed.
This is where the bank with other banks provides provide credit on
common terms on document
2.11.8 Rural Development Program:
Under its rural program, NBL, with joint collaboration of the Barendra
Bahumukhi Unnayan Katripakkha, has been providing improved technology,
irrigation facility, agricultural equipments, Potato growers etc. through
disbursement of small credit to the farmers of four districts (Rajshahi
chapainawabganj,Naogoan, Thakurgaon through (BMDA) which change in socio
economic condition of the farmers as well as ecological improvement of those
area. The bank financed an amount of Tk 154.4 million to 41821 borrowers in
has been disbursed among farmers under this program up to 31 December 2007.
NBL disbursed TK.325.3million in 2008 to 61862 borrowers indicating an
increasing 111percent over the period demonstrating banks firm commitment to
support this sector. Among small and medium entrepreneurs respectively under the
Agro based Industries and extension of agricultural technology and Loan Portfolio
Guarantee Scheme (LPGS) for setting up of small and medium scale industries in
rural areas with financial assistance of the USAID.
All necessary goods and services can be purchased from our selected out
lets by using master card or visa card issued from any part of the world. As a result
of this, a new avenue for earning foreign exchange has been created in the country.
Meanwhile, NBL has completed all formalities for issuance of Visa Card.
As the interest rate is very attractive and monthly installments are easy to
pay this scheme is getting popularity to the people. Till December 31, 2008 .
The deposit base of the bank registered a growth of 25.51 percent in the
reporting year over the last year and stood at Tk 60,195.20 million.
Instant inquiry
Facility for payment for installments under the monthly saving scheme,
etc
The bank earned Tk. 42.30 crore from share trading and received Tk. 4.21
crore as cash dividend during the year 2010. The bank also earned Tk. 25.07 lac
from its market intermediary activities i.e. Banker to the issue, Underwriter, etc.
In Bangladesh context the works that come under purview of the merchant
banking are
Issue management
Issue banker
Portfolio management
Underwriting
Mutual fund
The merchant banking division will continue its endeavor for a greater role
in expanding various services like issue of mutual fund in private sector,
expansion of micro credit, introduction of discretionary and non-discretionary
custodian service, launching of division accounts of loss and profit, certificate
deposit scheme, factoring credit syndication, project syndication, pre-investment
study, corporate counseling and other different areas.
3 An Appraisal of National Bank Ltd
3.1.1 Funding
Capital Management of the Bank is to maintain an adequate capital base to support the
projected business and regulatory requirement. NBL always maintains a prudent balance
between Tier-I and Tier-2 capital. Total capital as on December 31, 2010 was Tk. 19,190.79
million and capital adequacy ratio was 12.29 %. Maintenance of adequate capital enhanced
the Bank's single borrower's exposure limit up to a high level to cope with the corporate
customers demand.
The deposit base of the bank registered a growth of 33.37 percent in the reporting year over
the last year and stood at Tk.102,471.83 million. Expansion of branch network, competitive
interest rate and deposit products contributed to the growth. The customers of the bank
were individuals, corporations, financial institutions, government and autonomous bodies
etc.
In harmony with earlier years' trend, National Bank Limited was intensely active in
international trade during the year 2010. The Bank put forth every possible attempt to
expand its external business by establishing LC, undertaking export bill negotiations,
realization of export proceeds, foreign remittance etc.
The Bank opened a total 24,775 LCs amounting to USD 1,390.03 million for facilitating import
trade in 2010. The main commodities were capital machinery, raw cotton, scrap vessels, rice,
wheat, edible oil, petroleum products, yarn, fabrics, garment accessories and other
consumer items.
The Bank has been nurturing the export business enthusiastically since its inception. In 2010
it handled 22,135 export documents valuing USD 691.79 million with a growth of 24 percent
over the last year's volume of USD 559.78 million. Export finances were extended mainly to
readymade garments, knitwear, frozen food and fish, tanned leather, handicraft, tea,jute
goods etc.
Efficient Board and management, strong capital base, wide branch network, support from
other stakeholders helped NBL in revenue earnings and profit maximization. During the
period NBL earned an operating profit of Tk. 8,940.60 million in 2010 which was Tk 3,397.50
million in 2009 registering a growth of 163.15 percent. Net Profit after tax grew by 231.34
percent to Tk. 6,860.34 million in 2010 after making provision for loan loss and taxation.
National Bank Limited formulated befitting credit risk management criteria and strategies for
creation of balanced lending mix in it's portfolio both for short and long term with the
bottom line objective to ensure risk adjusted rate of return in it's credit transactions. Loan
and advances in the year 2010 registered an increase by 41.26% to BDT 92,003.56 million
from BDT 65,129.29 million in 2009. During the year 2010, the credit expansion mainly was
in bilateral project finance, syndicate finance, export, import and trade finance as well as
SME and Agri finance. The bank as a matter of policy prioritizes to make lending in the thrust
sectors of the economy so as to make distinctive value addition in overall economic uplift of
the country.
National Bank Limited exerted highest emphasis on overseas operation and handling a
sizeable quantum of homebound foreign remittance since beginning. By this time, it has
earned a reputation as the leader in providing such remittances not only among the
customers but also among the regulators. In 1985 the Bank established exchange house with
equity ownership and management in Oman. Subsequently many arrangements have been
made with different exchange houses and also by establishing subsidiaries abroad for
expanding the Bank's overseas network in places with high concentration of Bangladeshi
expatriates.
National Bank Limited in 1993 introduced Western Union Money Transfer, a global leader in
money transfer services in Bangladesh remained lone agent till 2002. It was a breakthrough
in getting prompt payment of foreign remittances by the beneficiaries which encouraged
remitters to use legal channel. As a contributor of national economy, NBL is relentlessly
working to ease the flow of inward foreign remittance. The bank introduced different
products and technology including Online Banking, EFT and other automated devices for
uninterrupted speedy payments. Furthermore, NBL entered into a deal with ASA, a leading
NGO having 3,000 outlets throughout the country and also with Social Islamic Bank Limited
(SIBL) to provide inward remittance products on behalf of NBL. In 2010, foreign remittance
brought through NBL was USD 708.67 million with an increase of USD 62.70 million over the
previous year showing a growth of 9.70%.
4 About General Banking of NBL
General Banking is most important part of banking services. Every bank
should have to provide that services. General Banking helps to do other activities
of the Bank smoothly. General Banking Division consists of the following fields
of activities:
Receiving payment
Collecting deposits
Account Opening
Issuance OF
Demand Draft
Telephone Transfer
Payment Order
Pay Slip
Bills
Out ward
Inward
Demand deposits
Time Deposits.
Demand deposits:
These sorts of Deposits are payable without any notification. Our branch is
collecting the above deposits through the following way:
By opening of:
Current account
Saving account
It may be CD A/C
Certificate of Incorporation
Certificate of Incorporation
Account Opening
Under this scheme, customers can deposit money for a term of 5 years. The
deposited money is fully refundable at the expiry of the term. At the same time,
during the term period they can enjoy a monthly profit corresponding to their
deposited amount. As for instance, under this scheme a deposit of Tk, 55,000/-
gives a monthly income of Tk.500/-.
Monthly Installment Return after 3 years Return after 5 years Return after 8 years
TK. 500/- TK 20,627 TK 37,896 TK 70,849
TK. 1,000/- TK.41,255 TK. 95,791 TK 1,41,697
TK 2,000 TK 82,510 TK 1,51,583 TK 2,83,394
TK 3,000 TK 1,23,765 TK 2,27,374 TK 4,25,091
TK 4,000 TK 1,65,020 TK 3,03,166 TK 5,66,788
TK 5,000 TK 2,06,274 TK 3,78,957 TK 7,08,485
TK 10,000 TK 4,12,549 TK 7,57,914 TK 1,41,6970
EXAMPLE-
DD is a written order from one branch to another branch of the same Bank.
It is not payable to bearer of the instrument. In practice, we can not issue DD
between Branches within the same city. We need to complete the following steps
for issuing a DD.
4.3.2 Issuance of TT (Telegraphic Transfer)
TT is one kind of telegraphic/Telephonic message order to pay someone the
fund between two Branches of the same Bank. It is the quickest & easiest way to
transfer fund from one place to another place.
Date
Not over only amount
Branch sill
4.4 Bills
Bank collects the bills through clearing in both inward and out ward.
OBC stands for Out Wards Bills Collection. Like LBC it is a process of
collection of instrument which is held between the two different Branches of the
Same Bank in the Different Clearing House/Different City. For example if any A/c
holder of our branch deposited a cheque which is drawn on our Agrabad Branch
Chittagong. In this case, we collect the proceeds through OBC.
5
6 Product & Services of National Bank
Products and services of National Bank Bangladesh given below:
1. Deposit product
Current Deposit
Short Term Deposit
Fixed Term Deposit
Monthly Deposit
RFC Deposit
NFC Deposit
2. Credit Product
Lease Finance
Home Loan
SME Loan
Consumer Credit
Trade Finance
3. Cards
Credit Card
Power Card
4. Credit Card
For most of the people on fixed income the opportunity to supplement their
monthly earning is a golden one. And NBL Special Deposit Scheme gives a
customer just that.
Under this scheme, customers can deposit money for a term of 5 years. The
deposited money is fully refundable at the expiry of the term. At the same time,
during the term period they can enjoy a monthly profit corresponding to their
deposited amount. As for instance, under this scheme a deposit of Tk,55,000/-
gives a monthly income of Tk.500/-.
This scheme is specially designed for the benefit of the limited income
group members. This helps to accrue small monthly savings into a significant sum
at the end of the term. So, after the expiry of the term period the depositor will
have a sizeable amount to relish on.
Through its Credit Card. National Bank Limited has not only initiated a
new scheme but also brought a new life style concept in Bangladesh. Now the
dangers and the worries of carrying cash money are memories of the past.
Credit Card comes in both local and international forms, giving the client
power to buy all over the World. Now enjoy the conveniences and advantages of
Credit Card as you step into the new millennium.
Minimum Payment 5%
ATM Facilities
Drawing of Cash : (i) from NBL ATMs - Free of charges (ii) From ATMs
under Q-cash network- Tk.10.00 per transaction (iii) From other ATM - Tk. 100.00
per transaction.
Only 1% loading fee against both International and Local Power Card at
the time of Refilling.
Always! Anywhere.
Cash withdrawals at all ATM Booths bearing VISA and Q-Cash logo.
Flexible limit
This simple transfer system, being on line eliminates the complex process
and makes it easy and convenient for both the sender and the receiver. Through
NBL - Western Union Money Transfer Service, your money will reach its
destination within a few minutes.
1 Comments
National Bank limited is a private commercial bank established in 1983. At
present it has 111 branches and I’ve worked in its uttara branch as part of my
internship program. Uttara is a residential area and large portions of this branch’s
customers are people residing in the area. These people are mainly deposit
holders. Business transaction is concentrated in two large real estate firms and a
few private universities of the area. A large number of student make up the
branch’ regular customers.
The work in accounts opening & Cheque book issue section is simply
customer service. Only one officer is assigned with the job. Although this seems
enough during slack period, during rush hour there is clearly a need for another
employee in this department.
The credit department consists of two principal officers. The work consist
of issuing credit cards.
Recommendation
It is very difficult to recommend a strong organization like National Bank
Limited, which is performing over 26 years. I a suggesting to improve in some
areas. So it can perform better in future.
With a strong deposit balance and assets National Bank Ltd run a efficient
way not only in our but also in the abroad. National Bank Limited has been trying
to operate its business successfully since 1983. The bank has already developed
good image and goodwill among its clients by offering excellent services. As a
newly established Branch, NBL Elephant Road is serving at its locality with utmost
satisfaction of the customer. So, NBL Elephant Road Branch has to compete with
those banks as well as other Commercial Banks. Today, the whole Banking sector
is facing a tough competition and challenge. In this situation this Branch is in good
position than any other Bank of its locality and day-by-day is increasing its
activities & goodwill.
Finally I can say that among the entire private bank in Bangladesh,
National Bank limited always providing the efficient service with very affordable
price. It is expanding their business all over the world with their performance
rapidly.