IX

INTRODUCTION
1
Introduction
1.1 Background of the Study
I am the student of Masters of Business Administration (M.B.A) study the subject's related
to business including Accounting, Management, Finance, Mareting, Mathematics, and
!ocial and cultural status and little about science and technology. "he schools of business at
home and abroad try to familiari#e each student as they mo$e comfortably in the business
en$ironment. But only the theoretical study in the class rooms is not enough rather a
%ractical e&%erience and the only means of %ractical e&%erience is internshi% %rogram.
1.2 Rational of the Study
In the business en$ironment at home ' abroad there are lots of financial institution, business
firms, and industries (hich %ro$ide this facility to(ards us. If (e could not get this facility
of internshi% then a (ide ga%s (ill tae %lace bet(een our study and e&%erience. I thin this
is an e&tremely $aluable asset for us.
)e the students of business do this usually for three months. In our country there are many
bans %articularly the esteemed %ri$ate sector bans, and elite business firms %ro$ide this. In
this res%ect I ha$e done my internshi% at IFI* ban ltd. the one of the most reno(ned
%ri$ate ban in Bangladesh. I am thanful to IFI* Ban for this.
1. O!"ecti#e of the Re$ort
"he objecti$es of the re%orts is to %ro$ide
A general descri%tion of the baning
An e&%osure of %ractices of different baning acti$ities in IFI* Ban +td...
,ele$ant rules, regulations, theories and %ractices for baning.
Significance
IFI* BA-. +"/. is one of leading %ri$ate commercial bans of the country. "hrough it has
01 branches all o$er the country2 it is %erforming baning acti$ities $ery successfully. "o
mobili#e funds from sur%lus units and de%loy funds to deficit units, the ban is %laying a
great role in the economic de$elo%ment of the country. IFI* BA-. +"/. is one of the ey
%layers of country3s economic de$elo%ment.
1
1.% Sco$e of the Re$ort
"he re%ort co$ers different de%artments of IFI* BA-. +"/, lie 4eneral Baning, +oans
and Ad$ance ' Foreign 5&change etc. It also %resents a brief scenario of IFI* BA-. +"/
in total.
1.& "he limitations of the !tudy
"his is my first re%ort. I am not a(are of the format and (riting style of the re%ort. I thin6
this is the main reason (hy some limitations ha$e been recogni#ed here. But the re%orts
submitted to IFI* Ban academic section's library by the internees student of $arious
uni$ersities3s (ored as guideline to %re%are this re%ort. I ha$e also used reliable sources of
information by using some te&t boo, the manual etc. I ha$e tried to do the %erformance
measurement by using the data %ublished in annual re%orts.
!o I thin the main limitations of this re%ort are
7 +ac of e&%erience to %re%are a re%ort.
7+ac of clear no(ledge of different ratios.
7+ac of information
1.' (ethodology)
I inter$ie(ed the branch incumbent, de%artment in charges, officers and clients. I ha$e
obser$ed the acti$ities of the %eo%le of different dess, I did also obser$e the %ractice of the
branch3s Management. I ha$e re$ie(ed the Annual ,e%orts 8of IFI* BA-. +"/., Ban
*om%anies Act71991, -egotiable Instrument Act71::1. I ha$e also re$ie(ed /ifferent
;ublications regarding baning functions, foreign e&change o%eration, credit %olicies, and
<;ractical =rientation /airy3 Maintained by me.
7"his re%ort is formatted into fi$e segments
(a) "he Introduction
(b) "he =rgani#ational ;rofile
(c) =$erall Baning =%eration
(d) >uman ,esource Function In IFI* Ban.
(e) ;erformance Measurement
(f) Analytical !tudy and ,ecommendation
7In this re%ort the baning o%eration has been looed into as far as %ossible and a
%erformance measurement has been done by using different ratios and diagrams.
?
.
@
I F I * BA-. A" A ! .5 " *>
2.1 O*+R*I+, O- I-IC B.N/ 0TD.
International Finance In$estment and *ommerce Ban +imited 6IFI* Ban6
came in to e&istence In 19A0 as a joint $enture bet(een the 4o$ernment of
Bangladesh and s%onsors In the %ri$ate sector (ith the objecti$e of (oring
as a finance com%any (ithin the country and setting u% joint $enture
bansBfinancial Institutions abroad. IFI* (as Incor%orated as a %ublic
limited com%any (ith an authori#ed ca%ital of ". 1C core and %aid u%
ca%ital of ".1C core. IFI* commenced Its o%eration on February 1:,19AA
(ith a !ubscribed ca%ital of ".D core, contributed by leading %ri$ate sector
entre%reneurs In the country. the 4o$ernment held @9 %ercent shares and the
rest D1 %ercent (ere held by the s%onsors and general %ublic.
But, In 19:? (hen the 4o$ernment allo(ed bans In the %ri$ate sector IFI*
(as con$erted Into a full7fledged commercial ban. the In$estment com%any
has transformed Into baning com%any In Eune 1?,19:? and started acti$ities
from Eune 1@,19:? through Its Motijheel Branch.
At the $ery beginning the 0C %ercent share are o(ned by %ri$ate
entre%reneur and @C %ercent are o(ned by 4o$t. at the end of 19:@ the
authori#ed ca%ital (as 1C core and the %aid u% ca%ital (as Acrore 1D lacs
"aa only.
Annual re%ort as on 19:?. the o(nershi% of non 4o$t. sector is included7
1. Mr. Eahurul Islam, *hairman.
1. !alman F. ,ahman, Fice7*hairman.
?. A.M. Aga Gsuf.
@. !yed. Mohsen Ali.
D. Mr. Ahmadul .abir. =(ner of 6/ainic !hangbad6.
D
2. (i11ion2 *i1ion2 Strategy State3ent
"o establish and conduct all ty%es of baning financial in$estment
and trust business in Bangladesh and abroad.
"o carry on any business relating to (age earners scheme as may be
allo(ed by Bangladesh Ban from time to time including maintaining
of foreign currency accounts and any other matter related there to.
"o contract or negotiate all inds of loan.
"o form, %romote, organi#e, assist, %artici%ate or aid in forming,
%romoting or organi#ing any com%any or others.
"o encourage, s%onsor and facilitate %artici%ation of %ri$ate ca%ital in
financial, industrial or commercial in$estment.
"o %urchase or other(ise acHuire, undertae the (hole or any %art in
the business.
"o tae %art in the formation, management, su%er$ision or control of
the business or o%erations of any com%any.
2. O,N+RS4I5 STRUCTUR+
"he go$ernment of the %eo%les' ,e%ublic of Bangladesh no( holds ?D %ercent of
share ca%ital of the ban. +eading Industrialists of the country ha$ing $ast
e&%erience In the field of trade and commerce o(n ?@ %ercent of the share
ca%ital and the rest Is held by the general %ublic.
2.% CO(5OSITION O- T4+ BO.RD
Gnlie others ban in the %ri$ate sector, Board of directors of this ban is an
uniHue combination of both %ri$ate and 4o$t. sector e&%erience. *urrently it
consist nine (9) directors, of them four re%resent the s%onsors and general
%ublic and four senior officials in the ran and status of Eoin secretaryB
Additional secretary re%resent the go$ernment. "he Managing /irector is the
e&7officio director of the board. Board of /irectors, the a%e& body of the
Ban, formulates %olicy guidelines, %ro$ides strategic %lanning and
su%er$ises business and %erformance of management (hile the Board
0
remains accountable to the com%any and its shareholders. "he Board is
assisted by the 5&ecuti$e *ommittee and Audit *ommittee.
2.& C.5IT.0 .ND R+S+R*+
IFI* Ban has been consistently maintaining the <*a%ital AdeHuacy ,atio3,
as %rescribed by Bangladesh Ban. "his has been %ossible by a %olicy of
building u% both ca%ital and reser$es. It started (ith an Authori#ed and ;aid7
u% *a%ital of ". 1CC million and ". 0?.1C million res%ecti$ely in 19:?
(hich stand at ". DCC million and ". @C0.?9 million res%ecti$ely in 1CC?

2.' (ile1tone1 in De#elo$3ent of The Organi6ation
A
2.7 (anage3ent Structure)
(.N.8IN8 DIR+CTOR 9(D:
D+5UT; (.N.8IN8 DIR+CTOR 9D(D:
+X+CUTI*+ *IC+ 5R+SID+NT 9+*5:
S+NIOR *IC+ 5R+SID+NT 9S*5:
*IC+ 5R+SID+NT 9*5:
S+NIOR .SSIST.NT *IC+ 5R+SID+NT 9S.*5:
.SSIST.NT *IC+ 5R+SID+NT 9.*5:
S+NIOR 5RINCI50+ O--IC+R 9S5O:
5RINCI0+ O--IC+R 95O:
S+NIOR O--IC+R 9SO:
O--IC+R
2.< Ri1k (anage3ent
Credit Risk:
*redit ris is the %otential that the borro(er may not re%ay or fails to re%ay hisBher
debt obligation. "hey are e&%osed to credit ris through traditional lending
acti$ities and transactions in$ol$ing settlements bet(een their counter%arts.
O!"ecti#e1
:
II
Maintain a (ell7di$ersified asset %ortfolio (ithin a%%ro$ed ris tolerance le$els and
earn a return a%%ro%riate to the ris %rofile of the %ortfolio.
.$$roach
!ill a%%raisal officers first e$aluate credit transactions for commercial and
cor%orate loans. *redit Management *ommittee %ro$ides and inde%endent
assessment of all significant transactions, and a concurrence form this function is
usually reHuired to mae a lending commitment to a customer. "heir Audit and
Ins%ection /i$ision also re$ie(s management %rocesses in order to ensure that
establish credit %olicies are follo(ed. In addition, *redit Management *ommittee
%erforms %eriodic re$ie(s of significant and higher ris transactions.
Market Risk:
J
Maret ris is the %otential for loss from changes in the $alue of financial
instruments. "he $alue of a financial instrument can be affected by changes in
interest rates, foreign e&change rates and eHuity and commodity %rices. "hey are
e&%osed to maret ris (hen they enter into the follo(ing transactionsJ
+oans and Ad$ances (+/=s)
/e%osit (ith other Bans
7 In$estment
7 "reasury Bills
7 Bond
7 !hares
Foreign 5&change ;ositioning
O!"ecti#e
Identify, measure, monitor and re%ort all maret ris7taing acti$ities, ensuring that
e&%osures remain (ithin a%%ro$ed ris tolerance le$els and that the return from
maret ris acti$ities is acce%table.
.$$roach
"hey ha$e established Asset +iability *ommittee (A+*=) to monitor their maret
9
ris acti$ities. "he %rimary ris measurement methodology is ,e%ricing 4a% and its
sensiti$ity to interest rate changes. ,e%rising 4a% o$er 117month %eriod stood at
%ositi$e B/" @1D1.A0 million as at /ec ?1, 1CC:. ,e%rising 4a% as %ercentage of
total assets stood at 1@.A1K, (hich is (ithin the international standard of 1CK. In
the %osition, the -et Interest Income (-II) of the Ban may increase by B/" @1.D1
million in case of 1CC basis %oint increase in interest rate. >o(e$er, in case of 1CC
basis %oint decease in interest rate, the -II of the Ban (ill go do(n by B/" @1.D1
million.
9BDT in 3illion:
5articular1 *olu3e
,ate !ensiti$e Assets (,!A) 1A0D0.D0
,ate !ensiti$e +iabilities (,!+) 1?@C@.:C
,e%ricing 4a% (,!A7,!+) @1D1.A0
,e%ricing 4a% as K of "otal Assets 1@.A1K
For 1CC basis %oint increase in interest rate @1.D1
For 1CC basis %oint decrease in interest rate (@1.D1)
Liquidity Risk:
+iHuidity ris is the ris that the Ban may fail to meet is obligation due to short of
cash andBor cash eHui$alent assets. "his situation may arise in the case of
(ithdra(al of de%osits, debt maturities and commitment to %ro$ide credit.
O!"ecti#e
Main sufficient liHuid assetsL and finding ca%acity to meet their financial
commitments, under all circumstances, (ithout ha$ing to raise funds at
unreasonable %rices or sell assets on forced basis.
.$$roach
"heir a%%roach to liHuidity management is to %roject liHuidity reHuirements based
on e&%ected and stressed economic, maret, %olitical and enter%rise7s%ecific e$ent.
"his enables them to ensure that they ha$e sufficient funds a$ailable to meet their
financial commitments e$en in times of crisis. Funds encom%ass both liHuid assets
on hand and ca%ability to raise additional funds. "heir large based of scheme
de%osits form indi$iduals and strong ca%ital %ositions %ro$ide a long7term stable
source of funding. "he %rimary ris measurement methodology is to monitor liHuid
1C
asset ratios, de%osits mi&, core de%osits as %ercentage of total de%osits and net
liHuidity ga%.
0 20 40 60 80 100
Others
Sanings
Deposits Under
Scheme
%
+iHuid Assets M*ash N Balance (ith Bangladesh Ban N /e%osit
(ith other BansN Money at *all and !hort -otice N
In$estments.
Operational Risk:
=%erational ris is the ris of loss resulting form inadeHuate or failed internal
%rocesses, %eo%le and systems or from e&ternal e$ents.
O!"ecti#e
=%erational ris is inherent in all business acti$ities, and the management of these
riss is im%ortant to the achie$ement of organi#ational goals. )hile o%erational
riss can ne$er be eliminated, these can be managed, mitigated and in some cases
insured against to %reser$e and create $alue.
.$$roach
=%erational ris is managed through the establishment of effecti$e infrastructure
and controls. "o this end, (e ha$e established a (ell7formulated frame(or that
uses the strengths and s%eciali#ed no(ledge of our lines of business. =ur strategy
is to ma&imi#e our ability to manage and measure o%erational ris through
im%lementation of a frame(or that taes ad$antages of the best %ractices in the
industry
2.= >OINT *+NTUR+ .BRO.D
11
Bank of (aldi#e1 li3ited 9B(0:
IFI* Ban limited has established a joint $enture in the name of Ban of
Maldi$es limited at Male in the re%ublic of Maldi$es right in 19:? i.e. 1C
years ago. "his is the first -ational Ban of Maldi$es. "he o(nershi%
com%osition is 0CJ@C %ercent. "he 4o$ernment of Maldi$es o(n 0CK sharer
and the @CK sharer are o(ned by IFI* Ban limited.
O3an?Banglade1h e@change co3$any 900C:
"o hel% remittance of more the ?C,CCC Bangladesh (age 5arners li$ing in
=men. "he ban has established an e&change house7=MA-
BA-4+A/5!> 5O*>A-45 *=M;A-P (++*) in the !ultanate of =man
in collaboration (ith =mani nationals =B5* has se$en branches.
Ne$al Banglade1h !ank 0td.
Q,
"his is the first joint $enture ban bet(een t(o countries. In /ecember 199?
the ban establish a joint $enture (ith DCK eHuity in -e%al. "he ban comes
into o%eration in Eune 199@.
O*+RS+.S BR.NC4
"he ban has a branch in .arachi in ;aistan (hich has started o%erations in
early 19:A. )ithin the short s%an of its o%erations the branch %rocured
si#eable business subseHuently. "he ban o%ened its second branch at +ahore
in 199?. Bath the branches enjoy re%utation and good (ill in ;aistan and
ha$e been o%erating %rofitably.
BR.NC4 N+T,OR/ 9DO(+STIC:
"he branches of the Ban co$er all the im%ortant trading and commercial
centers in Bangladesh. As of date, it has 01 branches (ithin Bangladesh. All
the branches are eHui%%ed (ith com%uters in addition to modern facilities,
logistics and %rofessionally com%etent man%o(er.
2.1A /ey -igure1
IFI* Ban follo(s the credit %olicy (ithin the frame(or of three main
objecti$es namely, maintenance and im%ro$ement of Huality assets, reco$ery
on time and building u% an efficient customer oriented credit deli$ery
system..
"he %ortfolio includes (oring ca%ital financing, %roject financing, and
im%ort7e&%ort financing and domestic trade financing etc. the continued to
e&tend (oring ca%ital facilities to customers to ensure smooth and
11
uninterru%ted o%eration of their business. At the same time, it e&%anded
%roject financing %ortfolio to meet the gro(th demands of the economy for
long term finance in a de%ressed ca%ital maret.
!o far the Ban has financed 19D %rojects. Among them @: %rojects (ere
financed during 1C1? amounting to ". 11CD.0C million. "he Ban also
%artici%ates in !yndicate Financing and so far has disbursed ". 1CCC million
in 1C %rojects. "he ban successfully handled t(o credit lines $i#7I/A credit
-o.1?@C and A/B loan -o.1CAC BA- (!F) (ith reco$ery rate of 1CCK and
:AK res%ecti$ely. Gnder these %rograms the Ban sanctioned loans of
".@1:.CC million to as D? units.
2.11 Ter3inology
IFI* Ban has been successfully %ro$iding in the recent years a good number of
ne( %roducts besides so called traditional ser$ices to meet the increasing demands
of the clients and the members of the %ublic. !ome of them areJ Fisa *redit cards,
A"Ms, ;hone Baning, ;ension !a$ing !cheme, /eath ,is Benefit !cheme,
*onsumer *redit !cheme, and 5ducation ;lan.
1.11 4u3an Re1ource De$art3ent) 94RD:
>uman resource de%artment in$ol$es all management decisions and %ractices that directly
affect or influence the %eo%le, or human resources, (ho (or for the organi#ation. In recent
years, increased attention has been de$oted to ho( organi#ations manage >uman ,esources.
"his increased attention comes from the reali#ation that an organi#ation3s em%loyees enable
an organi#ation to achie$e its goals and the management of these human resources is critical
to an organi#ation3s success.
-unction1 of 4RD)
1?
1. ;lanning for =rgani#ation, Eobs and ;eo%le
!trategic >uman ,esources
>uman ,esources ;lanning
Eob Analysis
1. AcHuiring >uman ,esources
55= (5Hual 5m%loyment =%%ortunity)
,ecruiting
!election
?. Building %erformance
>uman ,esources /e$elo%ment
>uman ,esources A%%roaches to im%ro$ing *om%etiti$eness
@. ,e(arding em%loyees
;erformance A%%raisal
*om%ensation and Benefits
D. Maintaining >uman ,esources
!afety and >ealth
+abor ,elation
5m%loyment "ransitions
0. Managing Multinational >,/
I3$ortance of 4RD)
"oday, %rofessionals in the human resources area are im%ortant elements in the success of
any organi#ation. "here jobs reHuire a ne( le$el of so%histication that is un%recedented in
human resources management. -ot sur%risingly, their status in the organi#ation has also
been ele$ated. 5$en the name has changed. Although the terms personal and human
resources management are freHuently used interchangeably, it is im%ortant to note that the
t(o connote Huite different as%ects. =nce a single indi$idual heading the %ersonal function,
today the human resource de%artment head may be a $ice %resident sitting on e&ecuti$e
boards, and %artici%ating in the de$elo%ment of the o$erall organi#ational strategy.
5hilo1o$hy)
1@
>uman ,esource (ors (ith the em%loyees in the organi#ation. Its main $ie(s are to %ut
the right %eo%le in the right %laces and also mae them an asset for an organi#ation.
O!"ecti#e)
>uman ,esource Management refers to the %ractices and %olicies one need to carry out the
%eo%le or %ersonnel as%ects of one3s management job. "hese includeJ
*onducting job analysis (determining the nature of each em%loyee3s job)
;lanning labor needs and recruiting job candidate.
!electing job candidates
=rienting and training ne( em%loyees
Managing (ages and salaries (determining ho( to com%ensate em%loyees)
;ro$iding incenti$es and benefits
A%%raising %erformance
*ommunicating (inter$ie(ing, counseling, disci%lining)
"raining and de$elo%ment
Building em%loyee commitment.
2.1 Di1trict ,i1e Branch Di1tri!ution)
1D
10
1A
1:
19
2.1% Balance Sheet)
1C
11
2.1& 5rofit and 0o11 .ccount)
11
2.1' Ca1h -loB State3ent)
1?
.
1@
.1 8eneral Banking)
/uring my %ractical orientation I (as %laced in IFI* Ban +imited. First I (as %laced in
Branch. I ha$e com%leted 4eneral Baning and some e&%osure in Ad$ance in this branch.
4eneral Baning is the starting %oint and main function of all the baning o%erations it is the
de%artment (hich %ro$ides day7to7day ser$ice to the customers. 5$eryday it collects de%osit
from the customers by allo(ing broing interest rate, meets their demand for cash by
honoring *heHues and lend it to the customers against ending interest rate. +ending interest
rate in higher than borro(ing interest rate, this is the %rofit for the ban.
-unction1 of thi1 de$art3ent
RAccounts o%ening section.
R*ash section ,emittance section.
R*learing section.
RAccounts section.
R5stablishment.
.1.1 .ccount1 O$ening Section
"his section o%ens different ty%es of account for their $alued customers. !election of
customer is $ery im%ortant for the ban because ban3s success and failure largely de%ends
on their customers. If customers are bad they creates fraud and forgery by their account (ith
ban and, this destroys the good (ill of the bans. !o, this section taes e&treme caution in
selecting its $alued customer.
Ty$e1 of .ccount1 Accounts can be classified into t(o ty%esJ
O$erati#e .ccount Non?O$erati#e .ccount1
;!! AlC
*urrent /e%osit Account
MI! AB*
!a$ings /e%osit Account

F/, AlC
!=/ Al*

!"/ Al*
1D
.1.2 Docu3ent1 for O$ening S$ecial .ccount)
5.RTICU0.RS
N+C+SS.R; DOCU(+NTS
.1. 0I(IT+D CO(5.N;
*ertificate of incor%oration
*ertificate of *ommencement of Business (in
case of ;ublic +imited *om%any only)
Form OII, (+ist of all /irectors, /esignation,
Address, !%ecimen signature)
Memorandum of Association
Articles of Association
;o(er of attorney
,esolution of the Board of /irectors authori#ing
o%ening of an account.
.1.% SOCI+TI+SCC0UBSC.SSOCI.TIONS
=ther than abo$e7mentioned common
documents, resolution of (ho (ill o%erate the
account must be noted.
.1.& 5RO5RI+TORS4I5 -IR(C
5.RTN+RS4I5 -IR(
-ame of authori#ed %ersons, designation,
s%ecimen signature,
"rade license,
;ass%ort (if there is no introducer)
Account must be o%ened in the name of the firm,
"hree form should describe the names and
addresses of all %artners,
;artnershi% deed is reHuired,
"rade license from *ity *or%oration is needed,
+etter of authority is achie$ed
10
.ccount O$ening 5rocedure in a floB chart)
I11uing CheDue !ook1 to the cu1to3er1
"he ban issues 1C lea$es cheHue boo for sa$ings account and 1C, DC and 1CC lea$es
cheHue boos for current account. "o com%lete the issuing of cheHue boos a customer has
to fill u% the reHuisition form for cheHue boos. "hen a ne( cheHue boo (ill be filled u% by
the account number of the customer. "he reHuisition sli%s are maintained and recorded in a
register as $oucher.
1A
A%%licant fills u% the
rele$ant a%%lication form
in the %rescribed
manner.
>eBshe is reHuired to fill
u% the s%ecimen
signature card
For indi$idual
introduction is needed
by an account holder
"he authori#ed officer
scrutini#es the
introduction and e&amine
the documents submit
Issuance of de%osit sli%
and the de%osit must be
made in cash. -o cheHue
or draft is acce%table to
the Ban
Account is o%ened
After de%ositing the cash
one cheHue boo is issued
Dor3ant account
If any account is ino%erati$e for more then one year is called dormant account. "o o%erate
this accounts manager's %ermission is necessary.
Tran1fer of .ccount
Account holder may transfer his account from one branch to another branch. For this he
must a%%ly to the manager of the branch (here he is maintaining his account. "hen the
manager sends a reHuest to the manager of the branch (here the account holder (ants to
transfer his account for o%ening the account.
/ind1 of .ccount 4older1
Branch may o%en accounts of the follo(ing categories of de%ositorsJ
1) Indi$iduals 7 Indi$iduals are adult %ersons of 1: years age or more (ho are com%etent
to
enter into contracts.
1) Eoint accounts 7 More than one adults jointly or adult (ith minor(s) may constitute joint
accounts.
?) !ole ;ro%rietorshi% concern 7 A business trading concern o(ned by a single adult %erson
is sole %ro%rietorshi% concern.
@) ;artnershi% firms 7 A business concern o(ned and managed by more than one %ersons
(hich may be registered or not registered is a %artnershi% firm.
D) ;ri$ate limited 7 A body cor%orate formed and registered under com%anies Act 199@,
(ith limited members.
0) ;ublic limited 7 A body cor%orate formed ' registered under com%anies Act 199@ (ith
limited liability of the shareholders and (ith no u%%er ceiling of shareholding both
certificate of incor%oration and certificate of commencement has gi$en by registrar.
A) "rusts 7 "rusts are created by trust deed in accordance (ith the la(.
:) +ISGI/A"=,! 7 +iHuidators are a%%ointed by court of la( for com%anies going into
liHuidation.
9) 5O5*G"=,! 7 5&ecutors are a%%ointed by a deceased himself before his death by
6(ith6 to settle the accounts of the %erson after his death.
1C) *lubBAssociationsB!ocieties 7 "here are organi#ations created ' registered or not
registered under societies registration act.
11) *o7o%erati$es 7 "here are cor%orate bodies registered under societies registration Act or
1:
com%anies Act or the co7o%erati$e societies Act.
11) -on74o$t. =rgani#ation 7 -4=s are $oluntary organi#ations created ' registered and
society's registration Act or co7o%erati$e societies Act.
1?) -on7"rading concern 7 "hese are organi#ation registered under societies registration Act
or com%anies Act or co7o%erati$e societies Act.
.1.' Other 5roduct1 and Ser#ice
R *urrent /e%osit Accounts (*/ account)
7 A current account may be o%ened by any indi$idual, firm, com%any, club, associates, etc.
BanJ may, ho(e$er, refuse (ithout assigning any reasons to o%en current account to any
body.
7 Minimum balance of ". DCCC (hile o%en.
7 -o current account (ill be o%ened (ith *heHues.
7 Fund in the current de%osit account shall be %ayable on demand.
7 Minimum balance to be maintained of ". 1CCC.
7 If minimum balance falls then incidental charges of ". DC (ill be reali#ed half is early.
7 -o interest is %ayable on the balance of */.
7 In case of closing of current account ". 1CC is to be reali#ed against incidental charges.
R !a$ing /e%osit Accounts (!B account)
7 0.DK interest is %ro$ided to de%ositors.
7 "he minimum amount of balance to be maintained (ith this ty%e of account is ". 1CCC
7 A de%ositor can (ithdra( t(o times in a (ee for more (ithdra(al de%ositors are not
entitled for any interest.
7 "o (ithdra( abo$e ". 1C,CCC the de%ositors has to notice.
7 -o sa$ings account (ill be allo(ed to be o$erdra(n.
R !hort term de%osit (!I/ AB*)
. . ? 4enerally o%ened by big business firm.
7 Interest de%ends on the amount de%osited.
7 Minimum amount of balance has to be maintained (ith !"/ account is " 1 lacs, (hile
19
o%en
7 Interest is gi$en at a rate of @K
7 Minimum amount is " DCCC must be maintained.
R ;ension !a$ings !cheme (;!!)
7 "his is a scheme to mae the customer introduced to the baning system under this
schemes the customers are to %ay a certain of money at monthly inter$al u% to a %eriod of D
to 1C years and after the %eriod they (ill get the returns along (ith the full interest earned
during the %eriod and the %rinci%al amount. Most of the clients under this scheme are middle
crass and lo(er middle class %eo%le
7 4enerally o%ened by small se$er.
7 Minimum Amount " DCC and minimum " 1CCC
7 Interest rate 9.CCK
7 Maturity D to 1C years.
PSS 5 years
Monthly installment ;rinci%al amount Bonus )ith Bonus
DCC ?0,10D 1DCC ?A,A0D
1CCC A1,D?C ?CCC AD,D?C
1CCC 1,@D,C0C 0CCC ' 1,D1,C0C
Liquidation of PSS
7 In case of premature encashment if the period is below 1 year then no interest will be
provide.
7 ff above 1 year interest will be given T Savings.
R (onthly Inco3e Sche3e 9(IS:
7 "his is another attracti$e scheme offered by this ban under this scheme the de%ositors anJ
to de%osit a fi&ed amount to the ban' and for their fi&ed amount they are entitled to earn J2
monthly %ayment from the ban. "his is an attracti$e scheme for the retired %erson. "his iQ
also a ind of F/,, but here the interest is gi$en monthly to the customers the de%osit (ill
bQ DC,CCC, 1C,CC,CCC, 1,DC,CCC res%ecti$ely.
7 "he rate of interest is 1C.:CK
?C
7 Maturity is CD years.
Liquidation of MIS
7 200 bank charge for premature encashment as out access duty.
7 Closing before 0 months no benefit will be providing.
7 reen casement between 0 months to 1 year interest are provide according to savings rate. 7 re
encashment between 1 to ? years savings interest are provide 0.!0 N saving rate
7 re encashment between ? to D years. Interests are providing 1.00"saving rate.
R -i@ed De$o1it Re1er#e 9-DR:
7 F/, is neither transferable nor negotiable.
7 It can be o%ened by all.
7 ;ro$ided A.DCK 7 :.1DK interest.
7 Interest rate $ery on %rinci%al amount.
7 "he de%osited %rinci%al amounts ha$e not fi&ed by the Ban.
7 =ne can de%osit any sum of amount under fi&ed de%osit reser$e.
7 In case of (ith dra(l before maturity the %re$ious maturity %eriod is considered to %aJ
interest according to sa$ings interest rate 0.DK it is no(n as %re matured en7casement.
Interest rate ha$e been rated by the Management of IFI* Ban on F/, ha$e gi$en belo(
(aturity $eriod Rate of intere1t
? months A.DK
0 months :.CCK
1 year :.1DK
1 year :.1DK
? year :.1DK
Liquidation of FDR
7 #nly the account holder himself and the authori$ed person can li%uid the &'( after maturity.
7 In case of )oint name authentication from both is necessary.
7 If demand before maturity the last e*pired duration is considered to pay interest.
.ccount o$ening $roce11
!te% l7 ,ecei$ing filled u% a%%lication in ban's %rescribed form mentioning (hat ty%e of
account is desired to be o%ened.
!to% 1? "he form is failed u% by the a%%licant.
!te% ??"(o co%ies of %ass%ort si#ed %hotogra%hs for indi$idual and in case of firm's
?1
%hotogra%hs of all %artners are necessary.
!te% @7A%%licant must submit reHuired document.
!te% D7A%%licant must sign s%ecimen signature sheet and gi$e mandate.
!te% 07Introducer's signature and accounts number $erified.
!te% A7 Authori#ed officer acce%ts the a%%lication
!te% :7 Minimum balance is de%osited only cash is acce%table.
!te% 97 Account is o%ened and de%osit sli% and a cheHue boo has gi$en.
?1
.2 Re3ittance in Banglade1h
*ash handling from one %lace to another is risy. !o, ban remits funds on behalf of the
customers to sa$e them from any misha%s through the net(or of their branches. IFI* has a
(ide net(or of branches all o$er the country and offers $arious ty%es of remittance
facilities to the %ublic. "hey ser$e as best media for remittance of funds from one %lace to
another. "his ser$ice is a$ailable to both customers as (ell as non7customers of the ban.
"he follo(ings are some of the im%ortant modes of transferring funds from one %lace to
another through bans. "hese are 8
i) ;ayment =rder (;=)
ii) /emand /raft (//)
iii) "elegra%hic transfer ("")
. 0ocal Re3ittance
!ending money from one %lace to another %lace for the customer is another im%ortant
ser$ice of the ban. "his ser$ice is an im%ortant %art of transaction system. In this ser$ice
system, %eo%le, es%ecially businessman can transfer funds from one %lace to another %lace
easily. "here are three inds of techniHue for remitting money from one %lace to another
these are
7/emand draft (//)
7;ay order (;=)
7"elegra%hic "ransfer ("")
??
,emitt
ance
..1 5ay Order 95.O: I11ue
;ay order gi$es the right to claim from the issuing ban1e A %ayment is an instrument from
one branch another branch of the ban to %ay a s%ecific sum of money. Gnlie cheHue there
is no %ossibility of dishonoring because before issuing %ay order the ban taes money in
ad$ance. "here are three reasons behind use of ;.=J
,emitting ;ur%ose
Ad$ice to ;ay
;ayment against bill submitted to the ban.
Pay Order consists of three parties:
+ Beneficiary
7 A%%licant
7 *ounter ;art.
Commission and chares of P!O:
Amount of ;.= *ommission on ,emittance 1DK FA" on *ommission
G% to ".. 1CC,CCC
1D @
1CC,CC1 to DCC,CCC DC :
Abo$e DCC,CCC
1CC 1D
Payment Process of Payin "ank:
;ayment is made through clearing.
Payment of Pay Order :
An the ;= issued by the ban is crossed one it is not %aid o$er the counter. =n the contrary
the amount is transferred to the %ayees3 account. "o transfer the amount the %ayee must duly
stam% the ;=.

?@
"he %ayee de%osits it to
his *ollecting Baner
;ayment is gi$en and is
registered in incoming
%ayment of ;.= Boo.
*ollecting Ban sends the
;.=. to the issuing Ban
through clearing house
arrangement
"he ;ay =rder is %assed
and cancelled in the
de%osit section.
Cancellation of P! #:
Step+I, Application writes to the manager of the account maintaining branch.
Step+2, -erification of specimen signature.
.ncasement of .#, /o encashment of that .#. the payee of the instrument deposits the
.#. to his bank. /he bank sends the pay order to the issuing bank through clearing. /hen
the . =. is passed through the deposit section and the . =. is send back to the clearing
house again and later the amount of .#. credited to payee0s account.
-loB Chart of 5.O.?4oB It ,ork1 )
If any AB* (ith
IFI* BA-.(the collecting
Baner)
?D
>e %urchased the ;.=. in
fa$or of a %erson or
com%any
5urcha1er ha1 an account
(ith IFI* and fill u% the
rele$ant from (ith a credit
$oucher
"he beneficiary de%osits the
;= in his account (ith IFI*
or another Ban
*ollecting Baner sends
an IB/A
"he collecting Baner
%resents the ;= to %aying
Baner through clearing
house
;ayee3s account is
credited (ith collecting
Baner
;ayee3s account credited
(ith collecting Baner
..2 De3and Draft 9DD: I11ue
// is an order of issuing branch on another branch of the same ban to %ay s%ecified sum of
money to %ayee on demand. It is generally issued (hen customer (ants to remit money in
any %lace i.e. outside or the clearing house area of issuing branch. ;ayee can be the
%urchaser himself or another mentioned in the //. It is safe techniHue of transferring money
from one %lace to another.
Payment process of the payin $ank:
+/est confirmation if the '' value is more then /k. 2!1000.00
+Confirm that the '' is not forged one.
+Confirm with sent advice.
+2ake paymen
Commission and chares of DD:
ostal charge /k. 1!.00 " commission 0.103 " 1!3 -at on commission.
4oB DD ,ork1)
?0
If // comes to the Ban
on (hich it is dra(n, the
Ban honors it.
An IB*A along (ith
%hotoco%y of // is sent
to the %aying Ban (An
ad$ice to %aying Baner)
// is handed to the
customer (here %aying
Ban is mentioned and
%ayment (ill be made
from another Ban
A%%licant fills u% the
rele$ant form (ith a
credit $oucher (income
AB*) for the Ban
"he a%%licant should
ha$e AB* (ith IFI*
Cancellation of '',
Step 7 I , Application is writing to the manager of the account maintaining branch.
Step 7 2 , -erification of specimen signature.
Step + 4 , 5ournal posting for incoming,
+6ills payable '' payable 'r.
+ I&IC 7eneral AIC Cr
5ournal posting for outgoing,
+I&IC general A8C 'r.
+arty A8C Cr.
Step + 9 , Send a letter to paying bank
.. Telegra$hic Tran1fer 9TT:
Issuing branch reHuests to another branch to %ay s%ecified sum of money to a s%ecific %erson
on demand by telegra%h or tele& or tele%hone. "ransfer of fund by "" is the ra%id and
*on$enient but e&%ensi$e method.
TT 9I11ue:)
*ustomer fills u% the "" form and %ays the amount along (ith commission in cash
or by cheHue.
"he res%ected officer issues a cost memo after recei$ing the "" form (ith %ayment
seal, then sign it and at last gi$e it to the customer.
-e&t a "" confirmation sli% is issued and its entry is gi$en in the "" issue register.
A test number is also %ut on the face of the sli%. "(o authori#ed officer signs this
sli%.
"he res%ecti$e officer transfers the message to the dra(ee branch mentioning the
amount, name of the %ayee, name of the issuing branch, date, test number and his her %o(er
of attorney (;.A.) number.
"he confirmation sli% is send by %ost.
?A
4oB TT ,ork1 9OutBard: )
?:
A%%licant fills u% the rele$ant form (ith a
credit $oucher (Income AB*) for the Ban
A%%licant has an account
(ith IFI* Ban
"e&t of tele& is (ritten or the rele$ant information along (ith
"est code is sent to the %ayee Ban through fa& or tele%hone
Another 1 co%ies of the te&t are sent through courier to the ;ayee3s
Ban.
"he reconciliation de%artments
reconcile t(o co%ies and
detect the fraud or forgery if
any
"hen one co%y from dra(er3s Ban and
another from ;ayee3s Ban are sent to the
reconciliation de%artment of local office.
Before that the ;ayee3s
Ban decode the test and if test
is agreed
;ayee3s account credited
Payment Process of %%:
!te%7IJ "est confirmation
!te%71J *onfirm issuing branch
!te%7?J *onfirm %ayee's account.
!te%7@J *onfirm amount
!te%7DJ Mae %ayment
!te%70J Ad$ice sends to the >ead =ffice for reconciliation.
Commission and Chares of %%:
7"ele%hone or "ele& charge "..?C.
7*ommission of ;rinci%al amount.
71DK FA" on commission.
+ntry for TT
a: On I11uing of TT )
1. *ash B ,es%ecti$e AB* (issuer) 77777777777777 /r.
IFI* BA-.4eneral AB* 7777777777777777777777777777 *r.
(;rinci%al amount)
Income AB*7%ostage 77777777777777777777777777 7777777*r.
Income AB*7*ommission on "" 7777777777777777 77*r.
1. IFI* BA-.4eneral AB* 77777777777777777777777777 /r.
Bills ;ayable AB*7"" ;ayable 7777777777777777777 *r.
!: On 5ay3ent of TT
Bills ;ayable AB* 8 "" ;ayable 7777777777777777777777 /r.
;arty AB* 777777777777777777777777777777777777777 *r.
Te1t .rrange3ent of TT E DD
"est is the security code by decoding (hich any branch can be sure that the "" or // is not
forged one. =nly the authori#ed officers no( the test code. 5ach ban maintains secret
code for this. "hat is the test arrangement is the combination of different secret codes.
?9
.% Clearing Section
"his section recei$es all inds of cheHue in fa$or of the $alued client for clearing on the %art
of their baning ser$ices. After recei$ing cheHue it is necessary to endorse it and cross it
s%ecially. *learing of cheHue is done through the clearing house in Bangladesh Ban.
7 1 st clearing
7 1nd clearing
Ty$e1 of cheDue for clearing
"here are four ty%es of cheHue for clearingJ
1) In(ard clearing cheHue.
1) =ut(ard clearing cheHue.
?) In(ard bills for collection.
@) =ut(ard bills for collection.
R Inward clearing che%ue
It refers the instruments dra(n on IFI* ban recei$ed by other bans in the clearing house
from the re%resentati$e of other ban.
R #utward bills for collection
)hen our branch sends *heHues to other branch ofIFI* ban is called =B*. Accounting
treatment of this %rocessJ
IFI* general (!ender's Branch) /r.
/e%ositor's AB* *r.
R Inward bills for collection :l.C;
"here are t(o ty%es of clearing, firstly cheHue collects from the other branch of IFI* banle
"hese *heHues are settled by sending m*A i.e. debiting de%ositors account and crediting
sender's branch account. .
!econdly cheHue collects from another ban outside the clearing house. "hese cheHue are
settled debiting de%ositors account and sending // or "" in fa$or of senders ban.
R #utward Clearing Che%ue
*heHue dra(n of another branch of IFI* ban are called =ut(ard *learing *heHue. "hese
ty%es of cheHue are directly sent to the res%ecti$e branch and reHuest them to send IB*A.
@C
.& Ca1h Section
*ash de%artment is the most $ital and sensiti$e organ of a branch as it deals (ith all inds of
cash transactions. "his de%artment starts the day (ith cash in $ault. 5ach day some cash i.e.
o%ening cash balance are transferred to the cash officers from the cash $ault. -et figure of
this cash recei%ts and %ayments are added to the o%ening cash balance. "he figure is called
closing balance. "his closing balance is then added to the $ault. And this is the final cash
balance figure for the ban at the end of any %articular day.
-unction1 of ca1h de$art3ent
7*ash %ayment
7*heHue cancellation %rocess
7*ash recei%t
R *ash %ayment
*ash %ayment is made only against cheHue.
"his is the uniHue functions of the bacing system (hich is no(n as 6%ayment on
demand6 .It maes %ayment only against its %rinted $alid cheHue.
R *heHue cancellation %rocess
,ecei$ing cheHue by the em%loyee in the cash counter and $erification of the follo(ing by
the cash officer in the com%uter sectionJ
i) /ate ofthe cheHue. (it is %resented (ithin 0 month from issue date)
ii) Issued from this branch.
iii) An amount in figure and in (ord does not differ.
i$) *heHue is not torn or mutilated. "hen gi$es %ay cash seal and sends to the %ayment
counter and %ayment office maes %ayment.
R *ash recei%t .
Another im%ortant function of this de%artment is recei%t of cash. /e%ositors de%osit money
in the account through this section by de%osit sli%.
i) It recei$es de%osit from de%ositors in from of cash.
ii) !o it is the 6mobili#ation unit6 of the baning system.
iii) It collects money only its recei%ts from.
i$) It recei$es cash for issuing %ay order "", //.
@1
Book1 3aintained !y thi1 1ection)
i) Fault registerJ It ee%s accounts of cash balance in $ault at the ban.
ii) *ash recei%t registerJ *ash recei%t in (hole of the day is recorded here.
iii) *ash %ayment registerJ *ash %ayments are made in a day are entries here.
i$) ,ough $ault registerJ *ash collection for final entry in $ault registers done here, as
any error and correction is not acce%table.
$) *ash balance booJ Balance here is com%ared (ith $ault register. If no deference is
found, indicate no error and omission.
.< Clo1ing of .ccount
"o close an account %arties may be reHuest to send an a%%lication along (ith the unused
lea$es of the cheHue boo. =n recei%t of the a%%lication the follo(ing ste%s are taen.
i) "he signature of the account holder is $erified.
ii) "he number of the unused cheHue lea$es shall be noted therefore.
iii) /ebiting the incidental charges to the account.
i$) "he account holder is ad$ised to dra( the remaining balance.
.= .ccount1 1ection
"his is ob$iously an inde%endent and uniHue de%artment, (hich (ors as the com%osition of
all the de%artments of the branch. "his section is fully com%uteri#ed. !o the con$entional
large ledger and journal boos are not e%t lie the some nationali#ed ban. It recei$es the
$ouchers from all de%artments and %re%ares the subsidiaries and maintains accounts.
+1ta!li1h3ent 1ection
"his section deals (ith em%loyees salary, many ty%es of internal e&%enses such as %urchases
of stationary, eHui%ment, machinery, %ayment of labor cost and con$ence. In case of lea$e
of absence em%loyee collects %rescribed form from this section.
0ocker facilitie1
+ocer facility is a$ailable in this branch. 4enerally %eo%le ee% their $aluable ornaments in
the locer. +ocers are three si#es one are small and other are middle and big. If any body
(ant to o%en a locer sBhe has to %ay rent ". 1:CC for big si#e, ". 1DCC for large and ".
11CC for small si#e annually. Any indi$idual can o%en a locer.
@1
.1A Credit and Ri1k (anage3ent
"he (ord credit comes from the +atin UcredoV means UI belie$eV. It is a lender3s
trust in a %erson3sBfirm3sBcom%any3s ability or %otential ability to command goods
or ser$ices of another in return for %romise to %ay such goods or ser$ices of
another in return for %romise to %ay such goods or ser$ices at some s%ecified time
in the future. "he maing of loans and ad$ances has al(ays been %rominent
%rofitable function of the bans. !anctioning credit to customers out of the funds at
its dis%osal is one of the %rinci%al ser$ices of a modern Ban.
As a financial intermediary the %rimary objecti$e of a ban is to collect de%osits
from the sur%lus units ((ho ha$e sur%lus fund) and utili#e the same by lending the
deficit units ((hose reHuires funds). Ban is the %ro%er medium of those %arties to
utili#e the ca%ital %ro%erly. Ban guild the sur%lus %arties (here to in$est. Ban
collect de%osits from sur%lus %arties in return ban gi$e them some %ercent of
benefits that are gained out of the different loan or credit e&tended to the
borro(ers. Ban taes residual %ortion of benefit from the credits.
As Ban deals (ith the money collected from the de%ositors re%ayable on demand.
!o, it can not afford to loc u% it fund for long or uncertain %eriods. *onseHuently,
Ban must safeguards its de%osits through effecti$e management of all %ossible
riss associated (ith its credits.
=ne of the most significant riss of a ban is e&%osed to is, (hat is generally
termed as &Credit Risk', (hich is the %rimary ris in the baning system. !ince the
largest slice of income generated by a ban and a major %ercentage of assets is
subject to this ris, it is ob$ious that %rudent management of this ris is
fundamental to the sustainability of a ban. Management of *redit ,iss needs to
be a robust %rocess that enables the Bans to %roacti$ely manage the credit
%ortfolio in order to minimi#e losses and earns an acce%table le$el of return for the
!hareholders.
,is is inherent in all as%ects of commercial o%eration. >o(e$er for Bans *redit
ris is the fundamental to the sustainability of a ban. "hus *redit ,is is an
essential factor that needs to be managed.
Credit Risk
*redit ris is the %ossibility that a borro(er (ill fail to meet its obligation in
accordance (ith agreed terms. *redit ris, therefore, arises from the Ban3s
dealings (ith or lending to cor%orate, indi$idual and other Bans or financial
institutions.
"o %re$ent e&cessi$e flo( of credit and %ro%er use of it, bans reHuire taing on
the a%%ro%riate credit a%%raisal %rocedure to im%ose financial disci%line on
borro(ers. "he %rocedure that organi#e, control and moti$ate the borro(ers (ill
called credit management.
@?
So3e Definition1 related Bith Credit Ri1k are Duoted !eloB )
U"he conce%t of high Huality loan cannot e&ist in the absence of objecti$e
credit standards.V
+ (. /aggart 2urphy.
UAsset Huality is the most im%ortant fundamental dimension of ban analysis.
Asset Huality ultimately dri$es e$erything, including margins, ca%ital adeHuacy,
underlying %rofitability, in$estment sentiment and $aluations.V 8 (oy (amos1
<ead of 6anking Analysis1 7oldman Sachs1 <ong =ong.
(ecessity of Credit Risk Manaement)
Baning in the ne( century is e$en more %ros%erous than the %ast o(ing to
re$olutionary ad$ancement in technology, as (ell as, de$elo%ment of ne( ideas
and systems. *onseHuently, e$ery Ban has to be (ell8eHui%%ed to cou% (ith the
modern baning system and to ado%t effecti$e means and (ays to negotiate its all
%ossible riss es%ecially the *redit ,is.
*redit constitutes the major %art of the Ban3s asset %ortfolio and managing credit
ris is by far the most im%ortant concern of the Ban. "he failure of a commercial
Ban is usually associated (ith the %roblems in *redit %ortfolio and is less often
the result of shrinage in the $alue of other assets. As such, *redit %ortfolio not
only features dominates in the assets structure of the Ban, it is critically im%ortant
to the success of the Ban as (ell.
)hile Bans ha$e faced difficulties o$er the years for a multitude of reasons, the
major cause of serious baning %roblems continues to be directly related to la&
credit standards for borro(ers and counter%arties, %oor %ortfolio ris management,
or a lac of attention to changes in economic or other circumstances that can lead
to a deterioration in the credit standing of a ban3s counter%arties. "his e&%erience
is common in both 481C and non 481C countries.
For most bans, loans and ad$ances are the largest and most ob$ious source of
credit ris2 ho(e$er, other sources of credit ris e&ist throughout the acti$ities of a
ban, including in the baning boo and in the trading boo, and both on and off
the balance sheet. Bans are increasingly facing credit ris (or counter%arty ris) in
$arious financial instruments other than loans and ad$ances, including acce%tances,
inter ban transactions, trade financing, foreign e&change transactions, financial
futures, s(a%s, bonds, eHuities, o%tions, and in the e&tension of commitments and
guarantees, and the settlement of transactions.
Management of *redit ,iss needs to be a robust %rocess that enables Bans to
%roacti$ely manage credit %ortfolio in order to minimi#e losses and earns an
acce%table le$el of return. 4i$en the fast changing dynamic global economy and
the increasing %ressure of globali#ation, liberali#ation, consolidation and
disintermediation, it is essential that Bans ha$e robust *redit ris management
%olices and %rocedures that are sensiti$e and res%onsi$e to these changes.
@@
!ince e&%osure to credit ris continues to be the leading source of %roblems in
bans (orld8(ide, bans should be able to dra( useful lessons from %ast
e&%eriences. Bans should no( ha$e a een a(areness of the need to identify
measure, monitor and control credit ris.
"o %ro$ide a board guideline for the Management of *redit ,is to(ards achie$ing
the objecti$es of the Ban, for efficient and %rofitable de%loyment of its mobili#ed
resources and to administer the *redit %ortfolio in the most efficient (ay, a clearly
defined, (ell %lanned, com%rehensi$e and a%%ro%riate *redit %olicy and *ontrol
4uidelines of the Ban is a %re8reHuisite
=n the other hand, IFI* is a ne( generation Ban. It is committed to %ro$ide high
Huality financial ser$icesB%roducts to contribute to the gro(th of 4./.;. of the
country through stimulating trade ' commerce, accelerating the %ace of
industriali#ation, boosting u% e&%ort, creating em%loyment o%%ortunity for the
educated youth, %o$erty alle$iation, raising standard of li$ing of limited income
grou% and o$er all sustainable socio7economic de$elo%ment of the country.
In achie$ing the aforesaid objecti$es of the Ban, *redit =%eration of the Ban is
of %aramount im%ortance. >ence,IFI* has changed a lot as credit culture has been
shifting to(ards a more %rofessional and standardi#ed *redit ,is Management
a%%roach.
In $ie( of the abo$e, the re%ort is %re%ared on Management of *redit ,iss
through the case study of IFI* Ban +td., (hich an effort to carry out a
com%rehensi$e study on ho( to manage the *redit riss and ho( to ee% it in
acce%table and a%%etite le$el.
Core Risks of "ankin)
"he riss of baning are com%le& and multi8dimensional. Bans are e&%osed to a
number of riss of different ty%es. ,esultantly, managing ris is an art of
identifying, measuring and mitigating the riss.
In $ie( of the abo$e, Bangladesh Ban has identified CD(fi$e) core ris area
relating to baning business (hich are as follo(sJ
*ore ,iss of Baning
@D
The (anage3ent of a!o#e Core Ri1k1 of Banking are de1cri!ed !eloB )
Credit Risk Manaement 8 It has already been stated in this re%ort that
Management of *redit ,is is the most significant and ey tas of the ban.
*redit ,is refers the %robability of loss arising from the failure of a
counter%artyB customer to %erform as %er agreement (ith the Ban. "he failure
may result from un(illingness of the borro(er or decline in either hisB her
financial condition or in the maret scenario. 5$entually, credit ris comes as
the most sensiti$e %art of ris management of the Ban.
*redit ,is has been discussed further in detail hereinafter.
)sset Lia$ility* "alance Sheet Risk Manaement 8 A Ban assets are mainly
de$elo%ed (ith and baced by its liabilities. "hus successful baning reHuires
efficient and effecti$e management of its assets and liabilities. Bans should
ha$e (ell8organi#ed Asset +iability Management des to monitor Balance
!heet ,is and +iHuidity ,is.
"he term Balance !heet ris refers to %otential change in earnings due to
change in the rate of ;rofit, Suality of assets, etc.
=n the other hand, +iHuidity ris can be defined as the ris or chance of failure
to meet u% any (ithdra(alB disbursement reHuest by a counter%artyB customer.
Forein +,chane Risk Manaement 8 !ince Foreign 5&change in$ol$es
%urchase and sale of foreign currencies against local currency, thus Foreign
5&change ris is the ris or chance of loss due to une&%ected mo$ement of
maret %rice of the currencies of different countries or the %rice of the assets
denominated by foreign currencies.
In our country all the foreign e&change transactions are carried out on behalf of
the customers against underlying e&change transaction rules and regulations
laid do(n by Bangladesh Ban, G*;/* :>niform Customs ? ractices for
'ocumentary Credit;and other 4o$ernment bodies.
For effecti$e and efficient management of Foreign 5&change ,is, Bans
should ha$e (ell8de$elo%ed and (ell8structured Foreign 5&change ,is
Manual and International !tandard /ealing ,oom Manual.
Internal Control - Compliance 8 Internal *ontrol ' *om%liance is the ey
of good management and a strong core of an organi#ation. It ensures safe and
smooth o%erations (ithin the organi#ation. All the rules and regulation
%racticed in the baning industry are meant to safety and efficiency in baning
o%erations of all ind.
Internal *ontrol ' *om%liance ensures that all the (oring units of a Ban
abide by those rules and regulations (ithout any fail. !ometimes o%erational
@0
loss arises out of errors and fraud due to lac of Internal *ontrol '
*om%liance.
Pre.ention of Money Launderin Risk 8 Money laundering refers to the act
of con$erting blacB illegal money into (hiteB legal money or %ro%erty. "he
%rocess of money laundering reHuires in$ol$ement of a ban, (hich is $ery
alarming for the baning industry.
Money laundering ris can be defined as the loss of re%utation and e&%enses
incurred as %enalty for being negligent in %re$ention of money laundering. For
successful %re$ention and efficient management of the ris Bans should
designate *om%liance officers at >ead =ffice and at the Branches, (ho
inde%endently re$ie( the transactions of the accounts to $erify sus%icious
transactions.
,is assessment is the %rocess of analy#ing %otential losses from a gi$en
ha#ard using a combination of no(n information about the situation,
no(ledge about the underlying %rocess, and judgment about the information
that is not no(n or (ell understood.
,is is defined as the %roduct of a ha#ard (such as damage costs) and the
%robability that this ha#ard occurs. In other (ords, (%robability) & (ha#ard) M
ris. "he first t(o $alues must be no(n or at least estimated in order to define
ris.
"he %rocess of combining a ris assessment (ith decisions on ho( to address
that ris is called ris management. ,is management is %art of a larger
decision %rocess that considers the technical and social as%ects of the ris
situation. ,is assessments are %erformed %rimarily for the %ur%ose of
%ro$iding information and insight to those (ho mae decisions about ho( that
ris should be managed. Eudgment and $alues enter into ris assessment in the
conte&t of (hat techniHues one should use to objecti$ely describe and e$aluate
ris. Eudgment and $alues enter into ris management in the conte&t of (hat is
the most effecti$e and socially acce%table solution.
"he combined ris assessment and ris management %rocess can be described
as a si& ste% %rocess. "he first three ste%s are associated (ith ris assessment
and the last three (ith ris management.
Flo( *hart of combined ris assessment and ris management %rocessJ
Formulate %roblem in a broad conte&t
;erform the ris analysis
/efine the o%tions
,is
Assessment
@A
The $rocedure of (anaging the Core Ri1k1 in I-IC are de1cri!ed !eloB )
Being a com%liant ban IFI* %ursues the guidelines of Bangladesh Ban
meticulously, in conseHuence of (hich the ban is being able to ee% the riss at
lo( le$el.
EB+ has formulated a com%rehensi$e *redit ,is Management ;olicy /ocument in
line (ith the guidelines issued by Bangladesh Ban, (hich is discussed hereinafter.
"he ban contem%lates to ha$e its assets assessed by an inde%endent agency for the
%ur%ose of (oring out strategy to manage credit riss.
In order to manage the asset liability ris IFI* has a (ell8organi#ed Asset +iability
Management /es under direct su%er$ision of a (ell8formed and (ell groomed
Asset +iability *ommittee (A+*=) (ith a $ie( to monitor and a$ert significant
$olatility in -et ;rofit Income (-;I), in$estment $alue of e&change earnings. "he
A+*= of the Ban monitors Balance !heet ris and re$ie(s liHuidity contingency
%lan. In order to manage the contingent %oints of time and o%eration, the A+*= of
the Ban calls for s%ecial meetings, analy#es the situation and decides (hat should
be done to ser$e the Ban3s interest most.
"he >ead =ffice International /i$ision of IFI* %lays the $ital role to manage
Foreign 5&change ,iss in the %rocess by checing the Foreign 5&change
%rocedure %erformed by the Ban and by re%orting it directly to the Managing
/irector of the Ban.
)ith a $ie( to mitigate o%erational ris the ban has an effecti$e Internal *ontrol
' *om%liance /i$ision that endea$ors to mae the internal control system
effecti$ely by intensifying the internal audit, both com%rehensi$e and s%ecial, of
the Branches and >ead =ffice. "he Audit *ommittee of the Board of /irectors
re$ie(s the audit re%orts and %uts forth suggestions (hich are being follo(ed (ith
due care. "he ban has the %lan to ha$e U!tandard =%eration ;rocedureV (!=;)
formulated by a re%uted consultant, (hich (ould strengthen the internal control
system and mitigate the o%eration riss.
Mae sound decisions
Im%lement decisions
5$aluate actions taen
,is
Management
@:
"here is an anti money laundering %olicy in %lace a%%ro$ed by the Board of
/irector, (hich is in line (ith 4uidance -otes on the subject issued by Bangladesh
Ban. "his contains all the control %oints to detect money laundering and to resist
terrorist financing. "he Board and the Management are fully committed to
%re$ention of money laundering.
@9
"erm +oan +oan 4eneral
*ontinuous +oan
A/FA-*5
.1A.1 0oan1 and .d#ance
Introduction
"his is the sur$i$al unit of a ban because until and unless the success of this section is a
Huestion to e$ery ban. If this section is not %ro%erly (oring, the ban it self may become
banru%t. "his is im%ortant because this is the earning unit of the ban. Bans are acce%ting
de%osits from the de%ositors in condition of %ro$iding interest to them as (ell as safe
ee%ing their de%osits. -o( the Huestion may gradually arise ho( the ban (ill %ro$ide
interest to the clients and the sim%le ans(er is ad$ance.
)e often use loans and ad$ances as an alternati$e to one another. But academically this
conce%t is incorrect. Ad$ance is the combination of such items (here loan is a %art only for
this credit section of the ban.
Ty$e1 of .d#ance
All loan and ad$ance that are %ro$ided by this ban can be categori#ed into there heads
according to the nature and characteristics of each %roductJ
Fiure sho/s the different types of ad.ances
DC
Nature of Different Ty$e1 of .d#ance
Ca1h Credit 4;5OT4+C.TION 9CC 4;5O:
*ash credit is gi$en through the cash credit account. *ash credit is an acti$e and running
account (here de%osit and (ithdra(als may be made freHuently. "he debit balance of the
account on any day can not e&ceed the agreed limit.
Instrument >P;=">5*A"I=- /55/.
DCK margin reHuires to o%en a ** account. ($aries)
=%eration of cash credit is same as that of o$erdraft the %ur%ose of cash credit is to meet
(oring ca%ital needs of traders, farmers, and industrialist.
It is granted only the first class %arties.
It is charged against a %ro%erty (here neither the o(nershi% nor the %ossession is %assed
to the ban.
Ca1h Credit 50+D8+
"he nature, o%erational (or, and characteristics of **7 ;+5/45 in as same as **7
>P;=.
**.;+5/45 in different from **7>P;= only from the securities or business goods
against the loan amount.
It is charged against %ro%erties (here the o(nershi% may remain to the borro(er but the
%ossession is %assed to the ban.
Instrument 7 ;ledge /eed.
Secured O#erdraft 9SOD:
=$erdrafts are those dra(ings, (hich are allo(ed by the bans in e&cess of the balance
in the current account u% to a s%ecified amount for definite %eriod as arranged for.
4enerally it is gi$en to the businessmen to increase their business acti$ities.
Gsually %ro$ide against F/,, ;!!, i.e. financial obligation or any %rimary securities.
"he interest charges from the date of first (ithdra(.
Interest is calculated and charged only on the actual debit balance on daily %roduct basis.
Balance of =/ account are fluctuates
"he interest rate of !=/ is ?K abo$e of F/, interest rate if the F/, is in our Ban.
If the F/, is in other ban then the interest r1te is 14.50%
D1
Industries +oan
It is a term loan.
It is gi$en for three (?) years at eHual installment.
4rass %eriod is allo(ed of this ty%es of loan.
4rass %eriod is the %eriod that reHuire to earn $isible returns.
=thers loan
+oan %ro$ided for other %ur%ose (hich is %roducti$e and less ris rather industrial sector are
treated as others loan.
"he terms and conditions of these ty%es of loan are same as industry loan.
>ouse Building +oan
"his loan is gi$e for the construction of building house. It is gi$es for three (?) years at eHual
monthly installment. "his loan is not %ro$ides freHuently.
!taff >ouse Building +oan (!>B+)
11C times of BA!I* salary is %ro$ided as !>B+. Ban rate N 1 K interest is charged to the
loan amount. ,e%aymeilt adjusted from their monthly salary. ,e%ayment is made at eHual
monthly installment.
*onsumes *redit !cheme
Gnder this scheme credit is gi$en to the customer to %urchase necessary and lu&ury
commodities lie com%uter, motor $ehicle, tele$ision, refrigerator, music system se(ing
machine, furniture etc.
=ther then the em%loyee it is gi$en to the $aluable client.
It is a 1@,?0,@: installment system T 1D.DCK interest.
!tuff loan against ;ro$ident Fund (!+;F)
1CK of basic in contributed by em%loyee ,e%ayment is adjusted from their on they salary.
Ma&imum sanction from ;F.
D1
+oan against ;!!
"his loan is %ro$ides against ;!! fund. :CK are gi$en of the ;!! fund.
"his is 1CCK secured for the ban.
;ayment against /ocument (;A/)
"he im%orters are to o%en letter of credit through any ban for im%orting goods. Most of the
time they are to e&tend credit to the im%orters if not %rohibited by Bangladesh ban. "his
loan creates, on recei%t of shi%%ing documents from the negotiating ban, is transferred and
lodged to ;A/.
;A/ is associated (ith im%ort and im%ort financing. "he ban o%ening letter of credit is
bound to honor its commitment to %ass for im%ort bills (hen these are %resented for
%ayment %ro$ided that it is dra(n strictly in terms of the letter of credit, in fact the amount
their sends ad$anced on behalf of the im%orter.
+oan against im%orted Merchandise (+IM)
In many cases, a ban has to clear the goods im%orted under letter of credit at the reHuest of
the borro(er. )hen the im%orter does not come for(ard to retire the documents ins%ire of
re%eated reminders ban has on forced circumstances to clear the im%orted consignment on
arri$al of the same to a$oid demurrage at the %ort (hich adds to the burden of commitment.
)hen the im%orter fails to retire the documents or reHuest for clearance of goods, the
outstanding under ;A/ is transferred to +IM account.
After clearance, consignments are taen deli$ery by the im%orter on full %ayment of ban's
liability. -ormally %art deli$ery is not allo(ed (hile on +IM A8C. (hen the deli$ery in %art
is desired by the im%orter, the +IM is con$erted into cash credit account retaining
%ro%er margin and e&ecuting charge documents, the deli$ery is effected themsel$es on
obtaining %ro rate %ayment.
"rust ,ecei%ts (",)
"his is an arrangement under (hich credit is allo(ed against trust recei%ts and im%orted or
e&%ortable goods remain in the custody of the im%orter or e&%orter but he is to e&ecute a
stam%ed trust recei%t in fa$or of the ban (here a declaration is made that goods im%orted
D?
or bought (ith the ban's financial assistance are held by him in trust for the ban. .
5&%ort *ash *redit (5**)
5** are e&tended to an e&%ort to facilitate the e&%ort of goods ' commodities for (hich
there is e&%ort letter of credit or contract on hand. It is a %re7shi%ment ' short term credit to
be liHuidated out of the %roceeds of e&%ort documents (hich include negotiation or %urchase
of e&%ort documents.
Securitie1 again1t .d#ance1
"he follo(ing securities are to be obtained by the branches de%ending on the nature of
ad$ances (hile allo(ing secured ad$ances to the %arties.
7 ;ratirashya !anchay ;atra, Bangladesh !anchay ;atra, I*B unit certificates,
)age 5arner /e$elo%ment Bond
7 Fi&ed /e%osit ,ecei%t issued by any branch of IFI* Ban +imited.
7 !hares Huoted in the /haa !toc 5&change +imited
7 ;ledge of goods and %roduce
7 >y%othecation of goods, %roduce and machinery
7 Immo$able %ro%erty
7 Fi&ed assets of a manufacturing unit
*heHues, /rafts, ;ay =rder, ,ail(ay ,ecei%ts, !teamer ,ecei%ts, Burge ,ecei%ts of the
4o$t. or *or%orations
!hi%%ing document
,hich .d#ance1 .gain1t ,hich Securitie1
All securities are not suitable for all ty%es of ad$ances. 5ach security has its o(n suitability.
!%ecific securities to be obtained by the branches (hile allo(ing ad$ance are sho(n belo(
against the ty%es of ad$ancesJ
D@
Ty$e1 of ad#ance1 Securitie1
+oans +ien of $arious inds of !anchay ;atras, 4o$t. !ecurities,
and !hares Huoted in the !toc 5&change, /ebentures, Fi&ed /e%osit ,ecei%ts, ;ledge of
goldB4old ornaments, hy%othecation of $ehicles. *ollateral of immo$able %ro%erties.
=$erdraft !anchay ;atra, -on7resident for de%osit (-F*/), shares,
debt. ;romissory notes, fi&ed de%osit, insurance %olicies, gold etc.
*ash *redits ;ledge or hy%othecation of stoc, %roduced merchandise.
Inland bills %urchase (IB;) "he bill itself.
;A/ !hi%%ing document for im%orts.
IM ;ledge of im%orted merchandise.
", "rust recei%t obtained in lieu of trustees.
5** ;ledge or hy%othecation of goods recei%ts.
Foreign Bills ;urchase !hi%%ing document for e&%orts.
5roce11 of 0oan Section
Ste$?1 ) Sanctioning !y the co3$etent authority
A secured ad$ance may be grant to a %arty only after getting a limit sectioned
from the com%etent authority.
Ste$?2 ) 0oanC.d#ance 5ro$o1al
For obtaining a loanBad$ance the %arty must mae an a%%lication in standard form in (riting
to the branch (here he maintains his o%erati$e account. After recei$ing the a%%lication from
the %arty, the branch manager (ill tae immediate ste%s to com%ile re%ort regarding the
%arty based on the follo(ing sources of informationJ
;ersonal in$estigation
*onfidential su%%orts from
=ther bans,
DD
*hamber of commerce
*IB from Bangladesh ban as the earnable.
"reading account ;B*, BB!. MBA if' any and other documents submitted by the
%arty.
"he a$erage balance and the %resent maintained in the account.
"he nature of o%erations during the last si& months and the date of o%ening
account.
Ste$? ) 5re$aration of li3it $ro$o1al1
"he branch, may %re%are a limit %ro%osal after being fully satisfied (ith the follo(ing
%ointsJ
"he financial %osition of the %arty.
;ur%ose for (hich ad$ance is reHuired.
-ature of securities offered.
"he %ayment arrangement.
Ste$?% ) ReneBal 5ro$o1al.
Ste$?& ) .$$ro#al !y 4ead Office and Branch re1$on1i!le.
+imit %ro%osal sent to >=.
!anctionBreject
,ecei$e the limit section ad$ice.
Ste$?' ) Di1!ur1e3ent of loan.
Ste$?7 ) 0oan 3onitoring and ad3ini1tration.
D0
Cla11ification of 0oan 9C0:
Ad$ance may classified or unclassified are determine on the basis of regularity of loan
reco$ery.


Figure ShoB1 the Cla11ification or 1oan
Uncla11ified 0oan) the re%ayment of ad$ance (hich ha$e regularity are called unc1assifiec
ad$ance. "his is a clean loan that is these is no o$erdue installment or not the e&%ire due
date.
Cla11ified) "he re%ayments of ad$ance (hich ha$e no regularity are classified. "hat means
(hich are irregular in nature, o$erdue installment of %ayment, and e&%ire the due date. "here
are three standards of classificationJ

7 !ub !tandard
7 /oubtful
- Bad +oan
A!!5!!M5-" =F +=A- ' A/FA-*5
*+A!IFI5/ (I,,54G+A,)
*+A!!IFI5/
(IRREGULAR)
/=GB"FG+

!GB!"A-/A,/
BA/ +=A-
G-*+A!!IFI5/
(,54G+A,)
DA
5ligible security
7 For land and building DCK.
7 Financial obligation 1CCK.
Interest sus%ense
7 "otal balance of interest against classified loan.
Base for %ro$ision
7 FormulaJ =utstanding 7 Interest sur%asses 7 5ligible security
7 In case of unclassified ad$ance the base for %ro$ision should e%t 1 K of the total
outstanding amount.
7 In case of bad loan the base for %ro$ision should e%t 1CCK of the total outstanding
amount
7 In case of doubtful loan the base for %ro$ision should e%t DCK of the total
=utstanding amount.
7 In case of sub standards loan the base for %ro$ision should e%t 1CK the total
=utstanding amount.
Basically this standards of classification are de%ends on the e&%ansion of time. "here are se%arate
systems of classification for each ty%e of loan. 5ach baning institution ha$e de$elo% there o(n
system of loan classification.
D:
0ending Ri1k .naly1i1 90R.:
+,A is the combination of analysis of $arious ty%es of riss that may occur (hile a loan
ha$e sanctioned. "his is an analysis of the measurement of %erformance of a com%any or
indi$iduals. )hen a loan has been %ro$ided by the ban then all ty%es of riss ha$e to
calculate. "his is not easy to e&%ress all the %ros and corns of +,A are not %ossible in this
re%ort. Before sanctioning a loan it is necessary to analy#e the +,A. IFI* Ban has
formatted this analysis (hich contains se$eral sheets of analysis to identify the strength and
(eaness and the re%ayment %robability of the lending.
>ere sho(s the sim%le flo( chart of +,A (here considering the business ris, com%any
ris, industry and management ris in the follo(ingJ


-igure) ShoB1 the Co3$onent1 that analy6ed in the 0R.
+5-/I-4 ,I!.
A-A+P!I!
Business ,is
Industry ,is
Industry ,is
*om%any ,is
*om%any
Management ,is
!ecurity ,is
!u%%ly ,is
!ales ,is
;erformance ,is
,eliance ,is
Mgt. *om%etence ,is
Mgt. Integrity Mgt.
*om%etence ,is
!ecurity *ontrol ,is
!ecurity *o$er ,is
D9

.1A.2 -oreign +@change
Introduction
A %erson li$ing in /haa city can mae %ayment to another in *hittagong (ith money or by
*heHues on any ban of the country. !uch %ayments do not %resent any %roblems. But
things are different (hen the debtor and the creditor li$e in different country. )hen a trader
from /haa city im%orts goods from -e( Por, the %ayment in$ol$es certain com%lication.
"he /haa man can %ay in taa but taa is of no use to -e( Por e&%orter. "here must be
some means of changing taa into dollar. =b$iously the inter$ention of a third %arty is
reHuired. !o there is a need for a foreign e&change mechanism.
&oreign e*change refers to the process or mechanism by which the currency of one country
is converted into the currency of another country. &oreign e*change is the means and
methods by which rights to wealth in a country@s currency are converted into rights to
wealth in another country@s currency.

+A.(. C<#B'<>(C
In terms of foreign e*change regulation Act 1D9E, as ada%ted in Bangladesh,
foreign e*change means foreign currency and includes all deposits. credits and balances
payable in foreign currency as well as all foreign currency instruments such as1 drafts1
travelers Che%ues1 and bills of e*change in any foreign country.
.1A. -oreign +@change 3arket and Banglade1h
"he statute for administration of foreign currency in Bangladesh is the foreign e&change
regulation Act, 19@A as ada%ted in Bangladesh. Gnder this Act, the res%onsibility and
authority of administration of foreign e&change is $ested by the go$ernment (ith the
Bangladesh ban.
)hile the Bangladesh ban has full authority to administer foreign e&change in Bangladesh,
it cannot do so by itself. "his is not %ossible for Bangladesh ban to deal (ith a large
number of e&%orters and im%orters indi$idually. "herefore, %ro$ision has been made in the
act, enabling the Bangladesh ban to delegate its %o(ers of functions to authori#ed dealers.
0C
.uthori6ed Dealer1 9.D:
In administering e&change control and foreign trade, *entral Ban of the country
(Bangladesh Ban) authori#es fe( branches of commercial bans to deal in foreign
e&change. "hese branches are no(n as UAuthori#ed /ealersV. "hey act as an agent of the
*entral Ban and (or under the UForeign 5&change ,egulations Act719@AV and
U4uidelines for Foreign 5&change "ransactions7Folume 1 ' 1V %rescribed by Bangladesh
Ban.
.1A.1A -oreign +@change De$art3ent)
"he IFI* Ban deals (ith foreign e&change (ith good(ill for a long time. It is handling of
foreign e&change closer to t(enty (1C) years. -o(adays 10 branches of this ban are
authori#ed to deal foreign e&change by Bangladesh Ban.
IFI* BA-. offers t(o ty%es of credit facilities to its customers. !uch as7
a) Funded *redit and
b) -on Funded *redit
a: -unded Credit )
"he credit facilities in (hich the fund of the ban is directly in$ested is no(n as funded
credit. !uch as7*ash *redit, !ecured =$erdraft act.
!: Non -unded Credit)
"he credit facilities in (hich ban3s funds are not directly in$ested are no(n as non7funded
credit. !uch as7+etter of *redit (+B*), 4uarantee etc.
+etter of *redit B /ocumentary *redit (U+B*sV) is the ey %layer in the foreign e&change
business. )ith the globali#ation of economy. International trade has become Huite
com%etiti$e. "imely %ayment for e&%orts and Huicer deli$ery of goods is, therefore, a %re7
reHuisite for successful international trade o%eration. 4ro(ing com%le&ity of international
trade, se%aration of commercial %arties across the globe etc. underlined the need for
e$ol$ing a system that balances bet(een the e&%ectations of the seller and the buyer.
/ocumentary *redit has emerged as a $ital system of trade %ayment, and fulfilled the
reHuisite commercial need. "his system substantially reduces %ayment7related riss for both
e&%orter and im%orter. "hus the letter of credit is the classic form of international e&%ort
%ayment, es%ecially in trade bet(een distant %artners. ;ayment, acce%tance or negotiation of
the credit is made by the ban u%on %resentation by the seller of sti%ulated documents (e.g.,
bill of lading, in$oice, ins%ection certificate).
01
"P;5! of +B*
,e$ocable
!ight +B*
"ransferable
Irre$ocable
-on7transferable
/eferred +B*


DOCU(+NT.R; CR+DIT C 0+TT+R O- CR+DIT 90CC1:)
/ocumentary *redit or letter of credit is nothing but an arrangement (hereby a ban
(issuing ban) acting at the reHuest and on the instruction of a customer (the a%%licant) or on
its o(n behalf undertaes to mae %ayment to or to the order of a third %arty (the
beneficiary) or to acce%t and %ay bills of e&change (draft) dra(n by the beneficiary, or
authori#e another ban to negotiate against sti%ulated documents %ro$ided the terms and
conditions to the credit are com%lied. "hus, /ocumentary *redits are ain to ban
guarantees. In %o%ular language, they are no(n as +etters of credit (+B*s). Ban guarantees
are, ho(e$er, issued to co$er situation of non7%erformance (hereas documentary credits are
issued on behalf of the buyer to co$er situation of %erformance, i.e., the issuing ban agrees
to mae %ayment to the beneficiary one he surrenders the reHuisite com%lying documents.
Ty$e1 of 0etter of Credit

The figure 1hoB1 the different ty$e1 of 0CC
%he Importer
9Buyer of 8ood1:
The "ank
0%hird
5arty:
%he +,porter
9Seller of 8ood1:
01
Nature of Different ty$e1 of 0CC
,e$ocable *redits J A re$ocable credit is one (hich can be amended or cancelled
by the issuing baner at any time (ithout %rior notice.
Irre$ocable *redits J An irre$ocable letter of credit contains an absolute
undertaing on the %art of the issuing ban to acce%t.
"ransferable *redit J "he main theme of this ty%e of credit is transferable i.e. if the
e&%orters can not able to su%%ly the goods then. they can
transfer it to others.
-on7transferable *redit J "hese ty%es of credit can not be transferable.
!ight +B* J In international business this ty%es of credit is most %referable.
"he main theme of this credit is the %ayment is %ro%erly secured.
/eferred +B* J A maturity %eriod s%ecified there. "he %ayment is made on
bet(een the maturity %eriods.
!ales *ontract
,eimbursing Agreement
/ocumentary *redit Agreement
+a( of +B*
B.N/ .S . 5.RT; O- DOCU(+NT.R; CR+DIT )
;arties to the documentary credit are7an issuing ban, an ad$ising ban, a confirming ban,
a reimbursing ban or negotiating bans.
I11uing Bank) "he Issuing Ban or the =%ening Ban is one (hich issues the credit,
i.e., undertaes, inde%endent of the undertaing of the a%%licant, to mae %ayment %ro$ided
the terms and conditions of the credit ha$e been com%lied (ith. "he %ayment may be at
sight if the credit %ro$ides for sight %ayment, or at maturity dates if the credit %ro$ides for
deferred %ayment. 5s%ecially the issuing ban should satisfy himself on the credit
The Buyer The Seller
The Buyer The Issuing Bank
The Issuing The Beneficiary
0?
(orthiness of the a%%licant. "he credit a%%lication must be in accordance (ith the Gniform
*ustoms and %ractices for /ocumentary *redit (G*;/*)7 I** %ublication no. DCC edition
of 199?.
.d#i1ing Bank) "he Ad$ising Ban ad$ises the credit to the beneficiary
authenticating the genuineness of the credit. "he ad$ising ban is generally situated in the
countryB%lace of the beneficiary.
I11uing Bank
9Banglade1h:
.d#i1ing Bank
9Singa$ore:
Confir3ing Bank ) A *onfirming Ban is one (hich adds its guarantee to the credit
o%ened by another ban, thereby undertaing the res%onsibility of %ayment B negotiation B
acce%tance under the credit in addition to that of the issuing ban. A confirming ban
normally does so if reHuested by the issuing ban. )hen the credit(orthiness of the issuing
ban is in doubt, beneficiary3s ban may reHuest the issuing ban to gi$e additional
confirmation by another ban. It is said, <Add *onfirmation3 in %ractice.
Negotiating Bank) A -egotiating Ban is the ban nominated or authori#ed by the
issuing ban to %ay, to incur a deferred %ayment liability, to acce%t drafts or to negotiate the
credit.
Rei3!ur1ing Bank) A ,eimbursing Ban is the ban authori#ed to honor the
reimbursement claims in settlement of negotiation B acce%tance B %ayment lodged (ith it by
Negotiating Bank
9Singa$ore:
Reimbursin
g
Bank
0@
the negotiating ban or acce%ting ban. It is normally the ban (ith (hich the issuing ban
has account from (hich %ayment is to be made. ,eimbursement claims in foreign e&change
business is settled by the Gniform ,ules for ,eimbursement (G,,)7I** %ublication no.
D1D.
"he Foreign 5&change /e%artment is mainly di$ided into three sections. !uch as7
1. I3$ort Section
2. +@$ort Section E
. Re3ittance Section
"he im%ort !ection deals (ith +B* in the %ers%ecti$e of the im%orters and the 5&%ort !ection
deals (ith +B* in the %ers%ecti$e of the e&%orters.
I-IC B.N/
0I(IT+D
Foreign Exchange
Department
Import
Section
+@$ort
Section
Re3ittance
Section
0D
.1A.11 I3$ort
Im%ort is the flo( of goods and ser$ices %urchased form one country to another. >ence,
im%ort of merchandise essentially in$ol$es t(o thingsJ bringing of goods %hysically into the
country and remittance of foreign e&change to(ards the cost of the merchandise and
ser$ices connected (ith this to the im%orter. In case of im%ort, the im%orters are ased by
their e&%orters to o%en letters of credit so that their %ayment against goods is ensured.
-ig ) Ty$e1 of I3$orter1
I(5ORT 5ROC+DUR+S )
An im%orter is reHuired to submit the follo(ing documents in order to get a license to im%ort
through IFI* BA-. Mir%ur Br.
A ban account (ith the branch
Im%ort ,egistration *ertificate (I,*)
"a& ;ayer3s Identification -umber ("I-)
;erforma In$oice B Indent
Membershi% certificate from a recogni#ed *hamber of *ommerce ' Industry or
"o(n Association or registered "rade Association.
Importer
Public Sector
(4o$t. =rgans. '
*or%ns.
;ri$ate
!ector
*ommercial (finished
%roducts
Industrial (ra(
materials, machinery3s Actual Gsers
00
+etter of *redit Authori#ation (+A*) Form %ro%erly filled in Huintu%licate signed by
the im%orter.
+B* A%%lication duly signed by the im%orter.
=ne set of IM; Form.
Insurance *o$er -ote (ith money recei%t.
FA" ,egistration *ertificate (for *ommercial Im%orters)
In case of %ublic !ector, attested %hotoco%y of allocation letter issued by the
allocation authority, Administrati$e Ministry or /i$ision s%ecifying the source, amount,
%ur%ose, $alidity and other terms and conditions against the im%orts.
Any such documents as may be reHuired as %er instruction issuedBto are issued by the
*hief *ontroller of Im%orts ' 5&%orts (**I'5) from time to time.
=n recei%t of the +*A Form and the other documents, the branch officials carefully
scrutini#e the documents and lodge the same in their res%ecti$e registration boos and duly
$erify the signature of the im%orter %ut on the +*A Form.
"o im%ort, a %erson should be com%etent to be an <im%orter3. "he office of the *hief
*ontroller of Im%orts ' 5&%orts (**I'5) %ro$ides the registration (I,*) to the im%orter.
After obtaining the I,*, the %erson has to secure a U+etter of *redit Authori#ationV (+*A)
registration from the ,egistration Gnit of Bangladesh Ban. After getting the +*A
registration, a %erson becomes a Hualified im%orter. >e is the %erson (ho reHuests or
instructs the o%ening ban to o%en an +B*. >e is also called the U=%enerV or UA%%licantV of
the credit.
5ro$o1al for O$ening Of 0CC
In case of an +B* of a small amount only the %rescribed a%%lication form, i.e., the +*A
Form is enough to o%en an +B*. But (hen the +B* amount is reasonably high or (here the
%arty intends to a$ail a credit facility, then the im%orter needs to submit an a%%lication to the
Foreign 5&change /e%artment for getting a limit of the +B* amount.
"he salient features of the a%%lication are
Full %articulars of the ban account
-ature of business
,eHuired amount of limit
;ayment terms and conditions
0A
4oods to be im%orted
=ffered security
,e%ayment schedule
The 0CC .$$lication -or3)
+B* A%%lication form is a sort of an agreement bet(een customer and ban on the basis of
(hich the letter of credit is o%ened. IFI* BA-. Mir%ur Branch %ro$ides a %rinted form for
o%ening of +B* to the im%orter. A s%ecial adhesi$e stam% of $alue ". 1DC is affi&ed on the
form in accordance (ith !tam% Act in force. )hile o%ening, the stam% is cancelled. Gsually
the im%orter e&%resses his decision to o%en the +B* Huoting the amount of margin in
%ercentage (!ome +B*3s are o%ened for 1CCK margin).
ReDuire3ent1 of 0CC O$ening
. A%%licant must hold a current de%osit (*/) account in the Ban.
>e must ha$e a trade license of im%ort
"a& Identification number ("I-)
Fat certificate.
Membershi% certificate.
Im%ort registration certificate (I,*) for industrial or commercial.
An im%orter must ensure the abo$e reHuirements (hile he is going to issue a +B* (ith any
ban to im%ort some thing form another country.
The 0etter Of Credit .uthori6ation -or3 90caf:
"he +etter of *redit Authori#ation Form (+*AF) is the form %rescribed for the authori#ation
of o%ening letter of creditB%ayment against im%orter and used in lieu of im%ort license. "he
authori#ed dealers are em%o(ered to issue +*A Forms to the im%orters as %er basis of
licensing of the im%ort ;olicy =rder in force to allo( im%ort into Bangladesh. If foreign
e&change is intended to be bought from the Bangladesh Ban against an +*AF, it has to be
registered (ith Bangladesh Ban3s ,egistration Gnit located in the concerned area office of
**I'5. "he +*A Forms a$ailable (ith authori#ed dealers are issued in set of fi$e (CD)
co%ies each. First *o%y is e&change control co%y, (hich is used for o%ening of +* and
effecting remittance. !econd *o%y is the custom %ur%ose co%y, (hich is used for clearance
of im%orted goods from custom authority. "ri%licate and Suadru%licate *o%y of +*AF are
to be sent to concerned area of **I'F office by authori#ed dealerB,egistration Gnit of
0:
Bangladesh Ban. Suintu%licate *o%y is e%t as office co%y by authori#ed
dealerB,egistration Gnit.
"he +etter of *redit Authori#ation Form (+*AF) contains the follo(ing details7
(1) -ame and address of the im%orter.
(1) I,* no. and year of rene(al.
(?) Amount of +B* a%%lied for (both in figure and in (ord).
(@) /escri%tion of item(s) to be im%orted.
(D) Im%ort "rade *ertificate (I"*) -umber B >armoni#ed !ystem of *ode (>!
*ode -umber.
The i3$ for3 )
"he IM; Form contains the follo(ings
-ame and address of the Authori#ed /ealer.
Amount of remittance to be %ermitted (i.e., +B* amount).
+*A Form number, date, $alue in ".
/escri%tion of goods, Huantity.
In$oice $alue in foreign currency (i.e., +B* amount)
*ountry of origin.
;ort of shi%ment.
-ame of steamerBairline (i.e., by roadBby shi%Bby air etc.)
;ort of im%ortation.
Indentor3s name and address.
Indentor3s registration number (ith **I'5 and Bangladesh Ban.
Full name and address of the a%%licant.
,egistration number of the a%%licant (ith **I'5
"y%e of +*F i.e. *ommercial or Industrial.
Scrutini6ation of lCc a$$lication )
=n recei%t of +B* a%%lication, the branch officials scrutini#e the same $ery carefully gi$ing
em%hasis to the follo(ing %oints7
09
1. +B* a%%lication is stam%ed (as %er 4o$t. !tam% ,ule) as it is a guarantee of
%ayment.
1. All information mentioned in different columns ha$e been furnished2
?. "he items to be im%orted are eligible according to im%ort entitleemnt2
@. If +B* is o%ened against indent, Bangladesh Ban3s %ermission, $alid
registration, authority to issue indent by indentor are to be checed2
D. "he terms and conditions sti%ulated in the +B* a%%lication are consistent (ith the
Bangladesh Ban Foreign 5&change 4uidelines, Im%ort "rade ,egulations, G*;/* etc2
0. "he amount and descri%tion of merchandise are rele$ant to +*AF and %roforma
in$oiceB indent B %urchase order2
A. !ur$ey ,e%ort or *ertificate in case of old machinery2
:. *arrying $essel is not of Israel or !erbia, Montenegro, IraH, Israel '
Afghanistan2
9. *ertificate declaring that the item is in o%eration not more than D years in case of
car.
.ccounting Treat3ent in Ca1e of 0CC O$ening
As soon as +B* is o%ened, the ban acce%ts a liability on behalf of the im%orter to mae
%ayment against the credit. ;ro$ided that the shi%ment is made (ithin the %eriod and other
term, and conditions as %er +B*are com%lied (ith, naturally, ban has to %ass an entry in
+B* liability ledger and also in the general ledger to sho( its actual liability acce%ted on
+B*. A liability $oucher in %assed as underJ
Contingent liability voucher
Customer@s liability on A8C 'r.
6ank@s liability on AIC Cr.
R 2argin and bank charge
Margin, *ommission, ;ostage and *able *harge are reco$ered from the %arty by %assing
entries as underJ
arties AIC 'r.
2argin AlC on AIC. Cr.
All charges on AIC Cr.
AC
"ransmission of +B*
In international trade, recei%t of +B* by cable, tele&, fa& is %referred by all. In that case the
(hole te&t of +B* is to be transmitted to the ad$ising ban.
"ransmission ;rocess of IFI* Ban
"he transmission %rocess of +B* of IFI* Ban are much more ad$ance. "hey are sending all
foreign +B* to the ad$ising ban through !)IF".
SBI&/+ Society for Borld Bide Inter 6ank /ale Communication. /his is a system of inter
bank transaction. .very bank or other financial institutions must get the membership of
SBI&/ to share the information. /his is a system of communication where further
confirmation will not re%uire.
.3end3ent of lCc )
"he letter of credit o%ened by a ban may need to amendment. If the su%%lier finds. that the
terms of the credit cannot be com%lied (ith in full, he (ould arrange for necessary
amendments by the o%ener before the goods ha$e shi%%ed. "hese amendments must be
ad$ised by the o%ening ban to the su%%lier through ad$ising ban. !ome time the o%ener
also may lie to amend the credit after it has been ad$ised.
.dding confir3ation)
!ometimes beneficiary or su%%lier of the goods insists the im%orter for adding confirmation
to +B*s or to issue +B*s (ith add confirmation. In that case, at the reHuest of the im%orter,
the Issuing Ban reHuests the Ad$ising Ban or any third ban to add their confirmation to
the +B*. -ormally, add confirmation charge is borne by the beneficiary and the confirmation
charge differs from ban to ban.
0odg3ent E retire3ent of 1hi$$ing docu3ent1)
=n scrutiny, if it is found that the document dra(n in conformity (ith the terms of the
credit, i.e., the documents are in order, this Branch lodges the documents in ;A/ (;ayment
Against /ocuments) and the follo(ing accounting treatments are gi$en7
;A/ AB* 777777777777777777777777777777777777777777777777777 /r.
IFI* BA-. 4eneral ABc (at >= %rescribed rate) 777*r.
5&change AB* 777777777777777777777777777777777777777*r.
A1
The re#er1al entrie1 are a1 folloB F
Baner3s +iability 777777777777777777777777777777777 /r.
*ustomer3s +iability 777777777777777777777777777777 *r.
()hen lodgment is %assed)
After %assing the lodgment $ouchers, the shi%%ing documents are then stam%ed (ith ;A/
-umber and entered in the ;A/ ,egister. Intimation is gi$en to the customer calling on the
ban3s counter reHuesting retirement of the shi%%ing documents. "he retirement $ouchers
are as follo(s
+B* Margin AB* 777777777777777777777777777777777777777777777777 /r.
;arty3s AB* 77777777777777777777777777777777777777777777777777777 /r.
;A/ AB* 77777777777777777777777777777777777777777777777777777777 *r.
Interest B *ommission AB* 77777777777777777777777777777777777 *r.
; ' " *harges AB* 77777777777777777777777777777777777777777777 *r.
After %assing the retirement $ouchers, endorsement is made on the bac of the Bill of
5&change as U,ecei$ed ;aymentV and the Bill of +ading endorsed to the effect U;lease
deli$er to the order of MB! 77777V, under t(o authori#ed signatures of the ban3s officers
(;.A. >older). "hen the documents are deli$ered to the im%orter.
+@$ort Section E +@$ort -inancing)
In the 5&%ort !ection, t(o (C1) ty%es of +B*s are handled in this branch7
1) Bac7to7Bac +B*2 and
1) 5&%ort +B*
5&%ort financing can be done in t(o (ays. "hese areJ
1) ;re7shi%ment Financing2
1) ;ost7shi%ment Financing.
;re7shi%ment financing can be done by o%ening of bac7to7bac +B* and ;acing *ash
*redit (;**). In case of %re7shi%ment financing, about 9CK is financed by the ban. =f that
%ortion, about ADK is for bac7to7bac +B* and 1CK is for %acing cash credit. Financing in
Bac to Bac +B* changes according to the %roducts i.e. -ormal fabric, Flannel fabric,
)o$en fabric etc. 5&am%le of %ost7shi%ment financing by ban is Foreign /ocumentary
Bills for ;urchase (F/B;).
A1
Back to Back 0CC)
In case of a UBac7to7BacV letter of credit, a ne( +B* (an im%ort +B*) is o%ened on the
basis of an original +B* (an e&%ort +B*). Gnder the UBac7to7BacV conce%t, the seller as the
beneficiary it as a <security3 to the Ad$ising Ban. "he beneficiary of the bac7to7bac +B*
may be located inside or outside the original beneficiary3s country. In case of a bac7to7bac
+B*, no cash security (no margin) is taen by the ban2 ban liens the first +B* (the master
+B*). In case of a bac7to7bac +B*, the dra(n bill is usageBtime bill.
;a%ersBdocuments reHuired for o%ening of bac7to7bac +B* are as follo(s
Master +B*
Falid Im%ort ,egistration *ertificate (I,*) and 5&%ort ,egistration *ertificate
(5,*)
+B* A%%lication and +*AF duly filled in and signed
;roforma In$oice or Indent
Insurance *o$er -ote (ith money recei%t
IM; Form duly signed
In addition to the abo$e documents, the follo(ing %a%ersBdocuments are also
reHuired to e&%ort oriented garment industries (hile reHuesting for o%ening of bac7to7bac
letter of credit 7
"e&tile ;ermission
Falid Bonded )arehouse +icense
Suota Allocation +etter issued by the 5&%ort ;romotion Bureau (5;B) in fa$or of
the a%%licant for Huota items.
A %ermission from Bangladesh 4arments Manufacturer3s ' 5&%orter3s Association
(B4M5A).
In case the factory %remises is a rented one, +etter of /isclaimer duly e&ecuted by the
o(ners of the house B %remises to be submitted. A checlist to o%en bac7to7bac +B* is as
follo(s7
A%%licant is registered (ith **I'5 and has bonded (arehouse license.
"he master +B* has adeHuate $alidity %eriod and has no defecti$e clause
A?
+B* $alue shall not e&ceed the admissible %ercentage of net F=B $alue of relati$e
Master +B*
Gsage ;eriod (ill be u% to 1:C days.

-loB Chart for !ack?to?!ack 0CC
5ay3ent for !ack to !ack 0CC)
In case of bac7to7bac +B* for ?C,0C,9C,11C ' 1:C days of maturity %eriod, deferred
%ayment is made. ;ayment is gi$en after reali#ing e&%ort %roceeds from the +B* Issuing
Ban. For 4arments !ector, the duration can be ma&imum 1:C days. For im%orting
machinery items or ca%ital goods for ?0C days Bac to Bac +B* can be o%ened.
.1A.12 +@$ort
IFI* is running e&citing as (ell li$ely e&%ort to deli$er the sur%lus %roducts to other
countries and thereby earns huge amount of foreign currency. ;ayment for goods e&%orted
from Bangladesh should be recei$ed through an Authori#ed /ealer in freely con$ertible
foreign currency or in Bangladeshi "aa from a -on 8 ,esident Account.
"he other ty%e of +B* facility offered by this Branch is 5&%ort +B*. Bangladesh e&%orts a
large Huantity of goods and ser$ices to other countries. ,eadymade garments (both nitted
and (o$en), jute, jute7made %roducts, fro#en shrim%s, tea are the main goods that
Check the credit li3it
5re$are offering 1heet if regular credit line i1 not a#aila!le
(ark lien on the (a1ter 0CC
I11ue the 0CC
A@
Bangladeshi e&%orters e&%ort to foreign countries. 4arments !ector is the largest sector that
e&%orts the lion share of the country3s e&%ort. Bangladesh e&%orts most of its readymade
garments %roducts of G!A and 5uro%ean *ommunity (5*) countries. Bangladesh e&%orts
about @CK of its readymade garments %roducts to G!A. Most of the e&%orters (ho e&%ort
through this Branch are readymade garment e&%orters.
-or3alitie1 for e@$ort 0CC
"he e&%ort trade of the country is regulated by the Im%orts ' 5&%orts (*ontrol) Act, 19DC.
"here are a number of formalities that an e&%orter has to fulfill before and after shi%ment of
goods. "hese formalities or %rocedures are enumerated as follo(s 8
+@$ort Regi1tration Certificate 9+RC: ) "he e&%orts from Bangladesh are subject
to e&%ort trade control e&ercised by the Ministry of *ommerce through *hief *ontroller of
Im%orts ' 5&%orts (**I'5). -o e&%orter is allo(ed to e&%ort any commodity %ermissible
for e&%ort from Bangladesh unless he is registered (ith **I'5 and holds $alid 5,*. "he
5,* is reHuired to be rene(ed e$ery year. "he 5,* number is to be incor%orated on 5O;
Forms and others documents connected (ith e&%orts.
The +X5 -or3) After ha$ing the registration, the e&%orter a%%lies to this Branch
(ith the "rade +icense, 5,* and the *ertificate from the concerned 4o$ernment
=rgani#ation to get the 5O; Form. If the branch is satisfied, an 5O; Form is issued to the
e&%orter.
Securing the Order ) G%on registration, the e&%orter may %roceed to secure the
e&%ort order. "his can be done by contracting the buyers directly through corres%ondence.
Signing of the Contract ) )hile maing a contract, the follo(ing %oints are to be
mentionedJ (a) descri%tion of the goods, (b) Huantity of the commodity, (e) %rice of the
commodity, (d) shi%ment, (e) insurance and mars, (f) ins%ection, and (g) arbitration.
5rocuring the (aterial1 ) After maing the deal and on ha$ing the +B* o%ened in
this fa$or, the ne&t ste% for the e&%orter is set about the tas of %rocuring or manufacturing
the contracted merchandise.
Regi1tration of Sale ) "his is needed (hen the %ro%osed items to be e&%orted are
ra( jute and jute7made goods.
Shi$3ent of 8ood1 ) "he follo(ing documents are normally in$ol$ed at the stage of
shi%mentJ (a) 5O; From, (b) %hotoco%y of registration certificate, (c) %hotoco%y of contract,
(d) %hotoco%y of the +B*, (e) customs co%y of 5,F Form for shi%ment of jute7made goods
AD
and 5;* Form for ra( jute, (f) freight certificate from the ban in case of %ayment of the
freight if the %ort of lading is in$ol$ed, (g) rail(ay recei%t, berg recei%t or truc recei%t, (h)
shi%%ing instructions, and (i) insurance %olicy.
The folloBing $oint1 1hould !e looked for F
"he terms of the +B* are in conformity (ith those of the contract.
"he +B* is an irre$ocable one, %referably confirmed by the Ad$ising Ban.
"he +B* allo(s sufficient time for shi%ment and a reasonable time for registration.
If the e&%orter (ants the +B* to be transferable, ad$isable, he should ensure those
sti%ulations are s%ecially mentioned in the +B*.
At last, the e&%orter submits all these documents along (ith a +etter of Indemnity to this
branch for negotiation. An officer scrutini#es all the documents. If the documents are clean
one, the branch %urchases the documents on the basis of baner7customer relationshi%. "his
is no(n as UForeign /ocumentary Bills for ;urchaseV.
5rocedure for -DB5)
After %urchasing the documents the follo(ing entries are made 8
F/B; AB* 7777777777777777777777777777777777777777777777777 /r.
+iabilities AB* 7777777777777777777777777777777777777777777777777 *r.
*harges AB* 777777777777777777777777777777777777777777777777777 *r.
5&%orter3s AB* 777777777777777777777777777777777777777777777777 *r.
(Before reali#ation of %roceeds)
IFI* BA-. 4eneral AB* (I/, >ead =ffice) 7777777777777777777777777777777 /r.
F/B; AB* 77777777777777777777777777777777777777777777777777777 *r.
*harges AB* 777777777777777777777777777777777777777777777777777 *r.
5&%orter3s AB* 77777777777777777777777777777777777777777777777 *r.
(Adjustment after reali#ation of %roceeds)
"he F/B; ,egister is maintained for recording all the %articulars.
Settle3ent of local !ill)
"he settlement of local bills is done in the follo(ing (ays 8
"he customer submits the +B* to the branch along (ith the documents to negotiate.
"he branch officials scrutini#e the documents to ensure the conformity (ith the
terms and conditions.
A0
"he documents are then for(arded to the +B* =%ening Ban.
"he +B* Issuing Ban gi$es the acce%tance and for(ards an acce%tance letter.
;ayment is gi$en to the customer on either by collection basis or by %urchasing the
document.
"he follo(ing accounting treatments are made for the %urchasing of local bill 8
+ocal Bill ;urchase 7777777777777777777777777777777777777777777777777777 /r.
;arty3s AB* 77777777777777777777777777777777777777777777777777777777777777 *r.
*ommission 7777777777777777777777777777777777777777777777777777777777777 *r.
Interest AB* 7777777777777777777777777777777777777777777777777777777777777 *r.
A local bill %urchase register is maintained to record the acce%tance of the Issuing Ban.
Gntil the acce%tance is obtained, the record is de%t in a *ollection ,egister.
(ode1 of 5ay3ent for +@$ort Bill1 Under 0CC)
"he most common methods of %ayment under a +B* are as follo(s7
.t Sight 5ay3ent) In At !ight ;ayment, the ban %ays the sti%ulated sum
immediately against the e&%orter3s %resentation of the documents.
.t Sight 5ay3ent
Credit
Deferred 5ay3ent
Credit
Negotiation 5ay3ent
Credit
.cce$tance 5ay3ent
Credit
5ay3ent 3ethod1
under 0CC
AA
A:
Deferred 5ay3ent) In deferred %ayment, the ban agrees to %ay on a s%ecified
future date or e$ent, after %resentation of the e&%ort documents. -o bill of 5&change is
in$ol$ed. In this branch, the %ayment is gi$en to the %arty at the rate of ?C,0C,9C,1:C,?0C
days rate as the case may be. But the >ead =ffice is %aid under ".". *lean ,ate. "he
difference bet(een the t(o rates is the e&change margin for the branch.
Negotiation Credit) In -egotiation *redit, the e&%ort has to %resent a bill of
e&change %ayable to him in addition to other documents that the ban negotiates.
.cce$tance Credit) In Acce%tance *redit, the e&%orter %resents a bill of e&change
%ayable to him and dra(n at the agreed tenor (that is, on a s%ecified future date or e$ent) on
the ban that is to acce%t it. "he ban signs its acce%tance on the bill and returns it to the
e&%orter. "he e&%orter can then re%resent it for %ayment on maturity. Alternati$ely he can
discount it in order to obtain immediate %ayment.
Te1t key arrange3ent)
"est .ey Arrangement is a secret code maintained by the bans for the authentication for
their tele& messages. It is a systematic %rocedure by (hich a test number is gi$en and the
%erson to (hom this number is gi$en can easily authenticate the same test number by
maintaining that same %rocedure. IFI* BA-. Mir%ur Branch has test ey arrangements
(ith so many bans for the authentication of +B* messages and for the transfer of funds.
-OR+I8N R+(ITT.NC+)
UForeign remittanceV means %urchase and sale of freely con$ertible foreign currencies as
admissible UForeign 5&change ,egulations Act719@AV and U4uidelines For Foreign
5&change "ransaction7F=+. 1 ' 1V of the country. ;urchase of foreign currencies
constitutes in(ard foreign remittance and sale of foreign currencies constitutes out(ard
foreign remittance.
!o (e see that there are t(o ty%es of Foreign ,emittanceJ
-oreign OutBard Re3ittance.
-oreign InBard Re3ittance.
(ode of OutBard1 Re3ittance )
Foreign "elegra%hic "ransfer (F"").
Foreign Mail "ransfer (FM").
Foreign /emand /rafts (F//).
A9
"ra$elers *heHue ("*).
Foreign *urrency -otes.
(ode of InBard Re3ittance
"elegra%hic "ransfer ("").
Mail "ransfer (M").
Mail "ransfer (M").
Foreign /emand /rafts (F//).
;ayment =rder (;=).
"ra$elers *heHue ("*).
Foreign *urrency -otes.
Telegra$hic Tran1fer 9TT:
"elegra%hic "ransfer refers to the %ayment instruction by tested tele&Bcable or authenticated
fa& by ban in abroad on an inland ban (localBforeign ban). -ormally foreign bans, (ith
(hich corres%onding baning relationshi% B dra(ing %re$ails, send ".".
-oreign De3and Draft 9-DD:
"he foreign banBe&change com%any on local ban usually issues Foreign /emand /raft. It
is an order to %ay a certain sum to a certain %erson or as his instruction, issued by the ban
on its o$erseas branch or on its corres%ondent ban. "he demand draft is handed o$er to the
%urchaser (ho sends it to the beneficiary. "he beneficiary obtains %ayment on %resentation
to the ban on (hich the draft is dra(n.
5ncashment of F// may tae %lace in t(o (ays7
;urchase,
!ending for collection.
:C
+ndor1e3ent1 of u1G in $a11$ort)
IFI* BA-. endorses G! /ollars (G!/), 4reat Britain ;ound (4B;) in %ass%orts. "o
endorse G! /ollar, the client has to a%%ly in the %rescribed form ("M Form). "he follo(ing
entries are gi$en in this regard, 7
*ash or *ustomer3 AB* /r.
Foreign *urrency on >and *r.
(/ollar !%ecial)
Student file o$en)
As (e no( that Bangladesh 8 "aa is not fully con$ertible. =nly current account not
ca%ital account of our currency is con$ertible. But in case of students (ho studied abroad
can tae any amount for their study cost. "hus IFI* BA-. o%ens student file to remit the
costs to the res%ecti$e institutes on behalf of the student subject to scrutini#ing the
a%%ro%riate documents issued from the registrar.
:1
:1
5+R-OR(.NC+ .N.0;SIS
Ratio .naly1i1
*urrent ,atio
Measures J It sho(s a firms ability co$er it's current liability (ith it's current assets.
Formula J *urrent Assets H *urrent +iability
/ebt to eHuity ,atio
Measures J ,atio that sho(s the e&tent to (hich the finn is financed by debt.
Formula J "otal debt 727 !hare >older's 5Huity
/ebt to "otal Asset ,atio
Measures J It highlights the relati$e im%ortance of debt financing to the firm by
sho(ing th, %ercentage of the firms assets that are su%%orted by debt financing.

Formula J "otal debt 727 "otal Assets
-et ;rofit Margin
Measures J Measures the %rofitability (ith res%ect to sales lincome generated in one
unit C1 money.
Formula J -et ;rofit After "a& 727 "otal Income
,eturn on In$estment (,=I)
Measures J Measures o$erall effecti$eness in generating %rofits (ith a$ailable assets,
earning %o(er in$ested ca%ital.
Formula J -et ;rofit After "a& 727 "otal Assets
,eturn on 5Huity (,=5)
Measures J Measures earning %o(er on share holder's boo $alue in$estment.
Formula J -et ;rofit After "a& 727 !hare >older's 5Huity
International -inance In#e1t3ent .nd Co33erce Bank 0td.
!I. -o ,A"I=! P5A,!
1CC: 1CC9 1C1C 1C11 1C11 1C1?
C1 *urrent 1.11 1.1? 1.@A 1.DA 1.D? 1.@D
,atio
C1 /ebt to ?1.1C 1:.19 11.9: 1D.@9 10.A0
5Huity ,atio
C? /ebt to "otal 1.?01 1.C01 C.90? C.901 C.9D?
Assets ,atio
C@ -et ;rofit C.C:A C.C9C C.C:@ C.C:? C.CA@ C.C9A
Margin
CD ,eturn on C .CCA C.CCA C.CC0 C.CC0 C.CC0 C.C1C
In$estment
(,=I)
C0 ,eturn on C.1:@ C.1 A1 C.1DD C.1@1 C.1D0 C.10?
5Huity
(,=5)
:?
Oct) Trend .naly1i1
Gntil no(, I ha$e introduced $arious financial ratios, e&%laining their uses in analysis. In
addition to financial ratio analysis, it is often useful to e&%ress balance sheet and income
statement items as %ercentages. "he %ercentages can be related to totals or some base year.
*alled common si#e analysis and inde& analysis, res%ecti$ely, the e$aluation of le$els and
trends in financial statement %ercentages o$er time affords the analyst insight into the
underlying im%ro$ement or deterioration in financial condition and %erformance.
"hese t(o ne( ty%es of analysis are e&tremely hel%ful in com%aring firm1 (hose data differ
significantly in si#e because e$ery item on the financial statements gets %laced or a relati$e
or standardi#ed, basis.
In common si#e analysis, (e e&%ress the $arious com%onents of a balance sheet as
%ercentageJ of the total assets of the com%any. In addition, this can be done for the income
statement, but here these analyses are e&%ressed only on the basis of balance sheet items.
*ommon si#e analysis is an analysis of %ercentage financial statement (here all balance
sheet items are di$ided by the total assets and total liabilities.
Inde& analysisJ An analysis of %ercentage financial statements (here all balance sheet or
income statement figure for a base year eHual to 1CC.CC %ercent and subseHuent financial
statement itemQ are e&%ressed as %ercentage of their $alues in the base year.
OS) Trend .naly1i1 of I-IC Bank 0td.
International -inance In#e1t3ent .nd Co33erce Bank 0td.
Taka In (illion
5articular1 ;ear1
Regular 1i6e Co33on Si6e I Inde@ Si6e I
Assets 1C11 1C11 1C1? 1C11 1C11 1C1? 1C11 1C11 1C1?
*ash 10C?.11 D11:.D9 1@CA.:1 0.CA 19.W: :.:C 1CC.CC ?10.1D 1DC.1C
Balance (ith 1ADC.11 11DA.1A 1?C.D1 0.0? @.1D 0.F9 1CC.CC 00.11 1?.1A
other ban I
Money at *all 1@CA.10 144!.00 0AC.CC D.?? @.9C 1.CC 1CC.CC 9@.:0 @A.01
In$estment ?1@ I.I 1 A11.@1 @1?9.:: 11.1A 1.0D 1D.D1 1CC.CC 11.10 1?C.:1
+oan ' Ad$ance 1A?11.A9 1:1:9.AC 19DC1.AC' 0D.D? 00.A? AC.1D 1CC.CC 1CD.C0 111.0D
;remises ' 1@C.A1 110.@1 1@1.DC 0.!4 0.9G 0.!1 1CC.CC :9.:@ 1CC.DD
Fi&ed Assets
=thers Assets 901.91 DCC.1@ D99.01 ' ?.0@ 1.:? 1.19 1CC.C D1.CC 01.??
"otal Assets 10@1A.11 1A1D:.0D 1A??1.9C 1CC.CC 1CC.CC 1CC.CC 1CC.CC 1C?.1: 1C?.@ A
+iability7 *a%ital
Borro(ing from 1D9C.1@ 119C.0D 1?11.?A 0.1D @.D@ @.AD 1CC.CC A@.:A :?.C9
other Ban
/e%osits 10DAA.D1 1A010.0: 1:A19.1C 0D.1? 0A.10 0:.:1 1CC.CC 1C0.1A 111.91
=ther liability A1:?.?0 A@11.?9 E4!4.!0 1:.01 1:.?C 10.@@ 1CC.CC 1C1.91 1CC.90
"otal liability 1D@D1.1? 10119.A? 1A:C0.0: 1CC.CC 1CC.CC 1CC,CC 1CC.CC 1C?.C0 1C9.1D
:@
S,OT .N.0;SIS
O-
I-IC B.N/ 0TD.
During my internshi% %eriod in IFI* Ban at Mir%ur I found some as%ects relating to the
Ban3s strength, o%%ortunity, (eaness and threats (hich are more or less %resent in almost
e$ery branches, I thin affecting the Ban3s %erformance in total. )hich are e&%lained
through !)=" analysis belo(J
Strength ,eakne11
X
Found that a good image about the Ban
has been created among the customers
through careful and Huality ser$ices
J
"he %rime (eaness I found lac of
moti$ation of (orers originating from
management3s mal7%ractices, %artiality,
inter %ersonnel clash, unsatisfied
grie$ances etc.
X
!illed and e&cellent management staff is
its focal strength.
J Absence of team(or because of subtle
inter%ersonal clash.
X
Suality ser$ices through modern
so%histicated automated system.
X
Sualified and no(ledgeable >uman
,esource.
J
Bad em%loyee7management relation in
some cases.
O$$ortunity Threat1
!
Fast o%%ortunity for e&%ansion and
customer finance
K
Fe( non7baing organi#ation snatching
a(ay fe( baning ser$ices lie7 some
trans%ort authorities are engaged in
money trans%ortation.
!
;otentials for in$estment in different
sectors increasing ra%idly in Bangladesh.
K
!te%%ing of ne( baning organi#ation
(ith highly u%dated so%histicated
automated ser$icing system and
%roducts.
!
=%%ortunity to ser$e Huality ser$ice
through the usage of u%dated technology.
K
Introduction of certain harder baning
rules and regulation.
K
*ustomer a(areness of %ricing and
ser$ices
:D
.nalytical Study
%he current ratio sim%ly calculated by di$iding the current asset by the current liabilities. If
the current asset is increase then the current ratio is increase too. If the current asset
decreases then the ratio is also decrease. And it sho(s the ability to co$er current liability
(ith it's current assets. >ere the current asset has calculated by deducting the fi&ed asset
from the total asset. "he de%osit has treated the current liability of a ban.
<ere analy$e the current ratio of H&IC 6ank using si* years data from 1CC@ to 200D. It can
be said that the recovery of current liability is much better and satisfactory and stable. /he
increase and deterioration trend of current ratio i..1@ %uite consistence. /his is good for a
bank or any undertakings.
De$t to equity ratio sho(s the e&tent to (hich the firm is financed by debt. /ebt to eHuity
ratio sim%ly calculated by di$iding the total debt by the shareholders eHuity. "his ratio tells
us that (hat %ortion of finance is %ro$ided by the shareholders and (hat %ortion is %ro$ided
by the creditors. *reditors (ould generally lie this ratio to be lo(, because (hile the ratio
is lo(er the %ortion of shareholders eHuity (ill be higher. "hen the creditor's liability (ill be
reduced.
/he debt to total assets ratio is deri$ed by di$iding a firm's total debt by its total assets. "his
ratio ser$es a similar %ur%ose to the debt to eHuity ratio. "his ratio detects that %ercent of the
firms assets are finance (ith debt (hile the remaining of the financing
. comes from others sources of eHuity.
In short, the higher the debt to total assets ratio, the greater the financial ris the lo(er this
ratio the lo(er the financial ris.
In case of I&1C 6ank Atd. the trends of si* years (1CC@ to 200D; of debt to total asset ratio is
satisfactory. 6ut this trend are changing and improving. /he management of this bank
should handle it carefully and always try to lower this ratio as well as the financial risk.
%he net profit marin ratio measures the %rofitability of any organi#ation. )e can $erify the
%rofitability of a business by using this ratio. "he ratio sho(s the net income of one unit of
total income.
In analysis the si* years net profit margin ratio of I&1C bank1 1 found that it pay G03 to
0DK ta*es to the government of eople@s (epublic of 6angladesh. /he net profit before ta*
:I6/; of si* years from W99A to 200D is consistent but in the year of 200D it has increased
significantly.
%he ratio of return on in.estment 0ROI1 measures o$erall effecti$eness in generating %rofit
(ith a$ailable assets.
If (e analy$e the si* years from2009 to 200D (e will see that the (#1 is growing
consistently of I&IC bank. 6ecause its total assets as well as net income after ta* :IIA/; are
increasing. /his is good for bonk and the economy of the country.
:0
%he ratio of return on equity measures the earning %o(er on shareholders boo $alue
in$estment.
/he trends of return on e%uity :(#.; is growing1 the reason is that the IIA/ and the
shareholders e%uity has increased over the si* years from 2009 to 200D. So the ratio of (#.
is moving upward.
>ere %resented the trend analysis by using t(o ne( ty%es of analysis.
R "he common si#e method.
R Inde& method
"hese are much hel%ful to reali#e the %erformance or trends of a business undertaing.
In this study these two analyses have been used only on balance sheet items.
In common si#e the total assets and the total liabilities are %resent T 1CCK and all the BB!
items are di$ided by total assets and total liabilities and multi%ly (ith 1CC to sho(
%ercentage.
9+ach !alance 1heet co3$onent1 L total a11et1 C total lia!ilitie1: @ 1AA
"his is not easy to reali#e the contribution of each 68S items on total of the business. "his is
the method ho( (e can reali#e it %rom%tly.
In case of 1&IC bank limited here I saw that the loan and advance or credit which is the
account receivable of a bank is closer to three fourth +489. which will be the main reason of
money crisis while the bank may need to finance at its crucial moments.
And in the liabilities a big portion is captured by the deposits which are the current
liabilities of a bank is also much closer to three fourth 7K. .
"he inde& method of trend analysis re%resents another side of IFI* ban +td. It sho(s a
consistence and steady gro(th (hich is really res%ectable and honorable in the %ri$ate sector
baning as (ell as Bangladesh economy.
:A
%.2 -INDIN8S
M >o%efully the management decided to %ro$ide fully com%uteri#ed ser$ices that (ill
booster ser$ices of the ban.
M )hen a joint stoc com%any comes to o%en an account if the com%any ha%%ens to be an
e&isting one, the baner should demand co%ies of the balance sheet and %rofit ' loss
account, (hich (ill reflect the financial gro(th of the com%any and its soundness, But in
%ractice com%anies and the baners as (ell don't e$en bother.
M Fe( officers of the ban are com%etent. 5$en though many of them sim%ly no( the
(oring %rocedure of (hat they are doing but don't no( the %hiloso%hy behind doing those
and some are inefficient to ser$e the customer.
M ;roject loan reHuires testing of feasibility of %roject and judging the maretability of the
%roduct. It reHuires infusion of no(ledge of both the fields7mareting and baning. But the
ban has hardly any %erson (ith this ind of ability.
M =fficers of the des, (here (orload is $ery high, hardly get the chance to go out for
de$elo%ment %ur%ose and al(ays feel that their duties for the organi#ation (ould not be
e$aluated unless they can sho( a good amount of de%osit collection against their name.
::
:9
&.1 R+CO((+ND.TION
In order to get com%etiti$e ad$antage and to deli$er Huality ser$ice, to% management should
try to modify the ser$ices.
R "he synergy of dedicated man%o(er, technology, maret o%%ortunity can lead the
organi#ation to achie$e the goal, a ban must establish and adhere to adeHuate of loan
%ro$ision and reser$e.
R IFI* Ban should train u% their branch %ersonnel about all sort of information regarding
!)IF" and its ser$ice.
R /ue to lac of %ro%er no(ledge about the o%eration %rocedures and ser$ices %ro$ided to
the customers by !)IF", certain customers are facing %roblem, as they ha$e to (ait for
certain tin1e to get ser$ice. and sometimes %ersonnel are not being able to o%erate !)IF"
(ithout any confusion. "hey are not fully inde%endent of handling !)IF". =fficial training
is the solution to this %roblem.
R IFI* Ban should al(ays monitor the %erformance of its com%etitors in the field of
Foreign "rade.
R Mercantile Ban +td. !tandard Ban +td. Mutual "rust Ban +td. ;remier Ban +td. First
!ecurity Ban +td. 5astern Ban +td. Ban Asia +td. and /haa Ban +td. and all other
%ri$ate bans are emerging com%etitors of IFI* Ban. "hey should continuously stri$e and
try .to introduce ne( %roducts and ser$ices as access card. A "M (ith future im%ro$ed
Huality ser$ices.
R For customer's con$enience in Foreign 5&change /e%artment of IFI* Ban +td. should
%ro$ide more %ersonnel to deli$er faster ser$ices to their honorable customer.
R It seems to me that day7by7day customers o%eration is increasing, indi$idual em%loyee has
to handle different ty%es of job. But that is %ocing a bac for an em%loyee. As a result it
might be ha%%en any big mistae by the em%loyee and ser$ice is also timed consuming and
customer has to suffer for this situation. May be it (ould be the reason for em%loyee's de7
moti$ation as (ell as the customer's dissatisfaction.
R IFI* Ban +td. should focus on their %romotional acti$ities.
9C
R "hey should also focus on the mareting as%ects to let customers no( about their
%roducts and offerings and more %romotion should be gi$en to attract ne( customer.
RIFI* Ban +td. must de$elo% electronic baning system to moderate the ser$ice.
"echnological ad$antage of a ban ensuring its com%etiti$e edge in the maret %lace can
only be achie$ed by efficient man%o(er. It is maret share to reduce its o%erating cost and
to generate ne( re$enue. 5lectronic baning system also allo(s increased access to the
financial system by its customers.
-eB other i3$ortant factor that 1hould !e focu1ed on the de#elo$3ent $roce11)
M 5$aluate customer's needs from their %ers%Cecti$e and e&%lain locally the shortcomings.
M *ustomer's con$enience should recei$e %riority o$er other.
M Im%ro$e office atmos%here to gi$e customers better feeling.
M "ime consumed at ser$ice le$el should be minimi#ed at o%timum le$el.
M Gse of effecti$e management information systems.
M Gse a%%ro%riate techniHues in e$aluating customer need %rofessionally.
M "o deli$er Huality ser$ice to% management should try to mitigate the ga% bet(een
customer's e&%ectation and em%loyee's %erce%tion.
91
-+, SU88+ST.TIONS
I. "he ban can offer to its customer better ser$ice if all of its de%artments are com%uteri#ed
and incor%orated under +ocal Area -et(or (+A-)
II. At the entry %osition the ban should enroll more e&%ertise %eo%le to augment Huality
ser$ices.
III. -o(adays7con$entional baning conce%t is outmoded. -o( bans are offering more
ancillary ser$ices lie credit card, on line ser$ices and many others. IFI* Ban +td. should
differentiate its ser$ices ado%ting the modern facilities.
QIF. Ban is %ro$iding both internal and e&ternal training for the officers but ban should be
scru%ulous about the training facilities so that official can im%licate this in their job.
F. ;eo%le are $ery choosy about en$ironment no( a dayQ so ban %remises should be (ell
decorated and I>* Ban +td. should loo into the matter $ery seriously.
FI. Ban should %ro$ide ad$ances to(ards the true entre%reneur (ith reconsidering
con$entional system of security and collateral, moreo$er, the (hole %rocess should be
com%leted (ithin an acce%table time.
91
&.2 CONC0USION
Form the learning and e&%erience %oint of $ie( I can say that I really enjoyed my internshi%
%eriod in IFI* Ban +td. at Mir%ur Br. from the $ery first day. I am confident that this ?
three months internshi% %rogram (ill definitely hel% me to reali#e my further carrier in the
job maret.
;erformance analysis of a ban is not so sufficient to measure and e&%ress %erfectly (ithin
this short time of my internshi% %eriod. But it is a great o%%ortunity for me to get used to
(ith the o%erational en$ironment of commercial baning of IFI* Ban. I ha$e tried by soul
to incor%orate the necessary rele$ant information in my re%ort.
"o% management of IFI* should conduct a com%rehensi$e study or sur$ey on the branches3
%erformance, its managements %erformance and the em%loyees3 %erformance and their
moti$ation as (ell. Fe( loyal committed customer base, lac of modern and effecti$e
technology or facilities, not enough silled em%loyee in some sector, considering all of these
$ery im%ortant factors. IFI* Ban should al(ays try to im%ro$e their ser$ice le$el in e$ery
terms.
"he mareting de%artment should thin freshly about their mareting objecti$es and
%ractices. ,a%id changes can Huicly mae yesterday's (ining strategies out of date. As a
de$elo%ing %ri$ate ban in Bangladesh, IFI* Ban shouldn't allo( their client to get
dissatisfied (ith their ser$ice. "hey ha$e their com%etitors (ho acti$ely stri$ing to tae the
ad$antages in e$ery side.
/uring the course of my %ractical orientation I ha$e tried to learn the %ractical baning to
relate it (ith my theoretical no(ledge, (hat I ha$e gathered and going to acHuire from
$arious courses.
9?
BIB0IO8R.54;
IFI* BA-. +"/., )oring Manual for different de%artment.
Im%ort ;olicy, %ublished by Ministry of *ommerce, Bangladesh !ecretariat, /haa.
Annual re%ort IFI* BA-. +"/.
Business of Baning 7 /r. ,.M. /ebnath.
A "e&t Boo on Foreign 5&change7 +.,. *ho(dhury.
!%ecial ;roject ,e%ort7 ;ublished by IFI* Ban
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