Figure i: Organization Structure
Investment policy
3.1 Investment policy of the Bank with Financial overview
3.1 Deposit
At the end of December 2008 the deposit of the Bank was Tk. 678.69. The growth of deposit is 19.43% compared to last year. The Bank has given great stress on procurement of low cost fund including cost free fund for bringing down the average cost of fund.
Figure iiii: Investment, 2001-2008
3.3 International trade
The international trade constitutes a major business activity conducted by the Bank. The important business of the Bank indicated a significant increase in the year. The import business during the year 2003 reached to Tk. 200.00 crores against Tk. 100.00 crores of the previous year which reflected a growth of 100%. The import business made by the Bank resulted in steady increase of revenues for the bank in spite of the downward trend in international trade. The export business handled by the Bank during the year 2003 was Tk. 210.00 crores compared to Tk. 85 crores in the previous year. The slow growth in export business is due to debacle in geopolitical arena, surrounding economic instability.
Figure v: Export Business, 2002-2003
3.4 Advance Deposit Ratio
If we observe the Ratio on Investment and Deposit, it appears that the MFI uses most of there deposits to investment which refers that the MFI mobilize its resources for the best reproduction.
Figure vi: Advance Deposit Ratio, 2002-2006
In 2002 the ratio was 61.00%. It rises to 82.00% in 2006.
3.5 Operating Result and Profit
The Bank earned an operating profit of Tk. 7.04 crore during the year before making any provisions. The operating profit of the Bank during the year 2002 was Tk. 3.15 crore and this Bank attained a growth of 124% in respect of operating profit. Due to having a cumulative loss of Tk. 5.43 crore no provision for income tax has been provided. After keeping a provision for loans & advances amounting to Tk. 2.23 crores the rest amount has been adjusted with cumulative loss which reduced the cumulative loss to Tk. 1.58 crores.
Figure vvii: Performance Acceleration, 2001-2003, and 2008
3.6 Guarantee Business
The Bank issued guarantees amounting to Tk. 50.00 crores during the year compared to Tk. 20.00 crores in the previous year registering a growth of 250%. The guarantees were issued in favour of different Govt. authorities, Autonomous bodies, Corporations, Multinational Companies etc. against proper securities on behalf of the clients of the Bank.
3.7 Investment
The Investment portfolio of the Bank during the year 2003 was Tk. 14.00 crore against Tk. 6.15 crore in the previous year registering a growth of 133%. The portfolio of investment included Govt. Treasury Bills, Prize Bonds, Share in Public Limited Companies etc. The Bank has always given emphasis on investment of fund in high yield areas and maintains Statutory Liquidity Requirement (SLR) as fixed by Bangladesh Bank.
3.8 Bank’s Performance at Glance
|
|
|||||
|
02. |
Paid-up Capital |
82.00 |
692.00 |
92.00 |
105.79 |
|
03. |
Loans & Advances |
57.00 |
170.00 |
291.10 |
578.60 |
|
04. |
Deposits |
176.00 |
280.00 |
409.39 |
678.69 |
|
05. |
Investment |
1.00 |
1.02 |
0.90 |
– |
|
08. |
Operating Profit |
0.22 |
3.15 |
7.04 |
3.25 |
|
09. |
Loan as a % of total Deposit |
71.00% |
61.00% |
32.00% |
– |
|
11. |
Number of Employees |
384 |
375 |
436 |
433 |
|
12. |
Number of Branches |
24 |
25 |
25 |
25 |
Table i: BCBL’s Performance, 2001-2003, 2008
Product & Services Rival Banks
4.1 Deposit Products: Standard Bank Ltd.
4.1.1 SRDP – SBL Regular Deposit Program
SRDP is a special savings plan that allows you to save and a monthly basis and gets a handsome amount at maturity. SRDP Account gives you the convenience of saving regularly in time with your monthly income stream. So, if you want to create a big savings to fulfill your cherished dream SRDP in the right solution.
-To open a SRDP Account all you need is to be over 18 years of age and a Bangladeshi Citizen.
-You can open a SRDP Account within 10 days of the month by filling up a prescribed account opening form at any Branch of Standard Bank Limited.
-You need to open a SRDP Account for 3 (three) or 5 (five) years, i.e. 36 and 60 equal monthly deposits respectively.
-Under the SRDP you can choose between a minimum monthly deposit amount of Tk.300.00 and a maximum amount of Tk.1000.00
Monthly deposit amount and amount receivable after 3/5 years
|
Installment Amount |
Matured Value |
||
|
3 years |
5 Years |
||
|
Tk. |
300.00 |
12,550.00 |
22,800.00 |
|
Tk. |
500.00 |
20,900.00 |
38,000.000 |
|
Tk. |
1,000.00 |
41,800.00 |
76,000.000 |
|
Tk. |
2,000.00 |
83,600.00 |
1,52,000.00 |
|
Tk. |
2,500.00 |
1,04,500.00 |
1,90,000.00 |
|
Tk. |
5,000.00 |
2,09,000.00 |
3,80,000.00 |
|
Tk. |
10,000.00 |
4,18,000.00 |
7,60,000.00 |
4.1.2 Flexibilities
§ Easy procedure to open SRDP
§ Upto 80% loan facility against SRDP deposit.
4.1.3 SRIP – SBL Regular Income Program
SBL Regular Income Program is an income program, which helps you to earn a monthly fixed amount on your deposits at SBL for a period of 3 years. If you are over 18 years of age, a Bangladeshi citizen and an account holder of SBL, you are eligible to open SBL Regular Income Program with our any branch and any time you want. It’s that easy.
|
Deposited amount |
Monthly Interest Payable |
|
50,000.00 |
450.00 |
|
100,000.00 |
900.00 |
|
2,00,000.00 |
1800.00 |
|
3,00,000.00 |
2700.00 |
|
4,00,000.00 & above |
3600.00 & above |
§ Easy procedure to open SRIP
§ Automatic profit transfer to linked account
§ Upto 80% loan facility against SRIP deposit.
4.2 (DI+) Double Income Plus
Double Income Plus is a 06 (six) years Program. Your deposit doubled plus in 06 (six) Months. Minimum initial deposit for the program is tk from 10,000/- (Ten Thousand) to Tk.25,00,000/- (twenty five lac).
4.2.1 Features of the Product are
To start with the Double Income Plus (DI+) deposit program one customer has to put Tk from 10,000/- (Ten Thousand) to Tk.25,00,000/- (twenty five lac) after maturity the deposited Double Plus. If the accounts/deposits are closed/encashed after one year of its opening, interest shall be allowed on the deposit at prevailing FDR interest rate.
4.2.2 Features & Regulations of the Program
-Deposit range is from 10,000/- (Ten Thousand) to Tk.25, 00,000/- (twenty five lac).
-Term of Deposit 06 (six) years 06.
-Double Plus amount will be paid after completion of the 06 (six) years term.
-Income Tax may be deducted as imposed by the government on the interest amount at the time of maturity/payment.
4.2.3 Special attractions
80% loan is allowed upon the deposit balance instantly. Payment Matrix [(for amount of Tk from 10,000/- (Ten Thousand) to Tk.25, 00,000/- (twenty five lac).]
At Maturity is shown below
|
Tenure |
Deposit |
Value at Maturity |
|
6 years 6 months |
10,000/- |
20,200.00 |
|
6 years 6 months |
20,000/- |
40,400.00 |
|
6 years 6 months |
50,000/- |
1,01,000.00 |
|
6 years 6 months |
1,00,000/- |
2,02,000.00 |
4.3 LSDIP- Life Secured Double Income Program
We know Savings increase Deposit and Deposit creates the opportunity of Investment. The Investment patronizes the establishment of Industry and presents wealthy economy of the country. So, the importance of Savings is vital for the country. Moreover, in personal life savings ensure our future. Out of all uncertainty death is the universal message of truth for all of us. Focusing on that SBL introduced Insurance Covered & life secured a special deposit program for fruitful utilization of its client’s hard earned savings.
4.3.1 Features & Regulations of the Program
-Deposit range is from Tk.1, 00,000.00 (One Lac) to Tk.25, 00,000.00 (Twenty Five Lac).
-Term of Deposit 07 years.
-Double amount will be paid after completion of the 7 years term.
-Saving rate will be allowed for any pre-mature encashment.
-In case of death of the depositor nominee will get double amount of the deposit balance. But it will effect after 12 (twelve) months from the date of account opening.
4.3.2 Special terms of the scheme
-Depositor’s age will be maximum 50 years.
-40 years above depositors will provide physical fitness certificate from the competent medical authority in case of the deposit amount of Tk.2, 00,000.00 (Two lac) above.
-In all cases depositors will provide a declaration about health fitness in a prescribed form
-Income Tax may be deducted as imposed by the government on the interest amount at the time of maturity/payment.
4.3.3 Special attractions
-In case of death of the depositor nominee will get double amount of the up to date deposit balance.
-80% loan is allowed upon the deposit balance instantly.
4.4 Revised Rate of Interest
Savings Deposit 7.00% & STD Deposit 6.00%
|
Deposit Products |
FDR for below Tk. 50 Lac |
FDR for Tk. 50 Lac & above |
|
FDR ( 1 Month but less than 3 Months) |
9.00% |
9.00% |
|
FDR ( 3 Month but less than 6 Months) |
11.50% |
13.50% |
|
FDR ( 6 Month but less than 1 Year) |
12.00% |
13.00% |
|
FDR (1 Year and above) |
12.50% |
13.50% |
4.5 Loan Products: Standard Bank Ltd.
Standard Bank Limited, occupied the leading position in 3rd generation private commercial bank, to explore a new horizon in innovative modern Banking creating an automated computerized environment providing one stop service and prepare itself to face the new challenges of globalization of 21st century.
Bank provides assistance for local and international trade using every mood of finance to the traders, exporters, manufactures, individual etc. The international trade encompasses a substantial portion of business conducted by the Bank. During the year 2004, the bank has contributed in the national economy after successfully handling of foreign exchange transactions viz. Import, Export (Both local and foreign).
In the wake of recession of business, the government is currently pursuing an accommodative monetary policy through a number of measures such as reduction in Bank rate, reduction in interest rate in government bonds and reduction on SLR requirement, simultaneously adoption of floating exchange rate and open market operation fueling incentives towards private investment with the aim of creating more capital avenues thereby generating more income to add to the GDP of the economy. In the juncture, it is very tough for a Bank to remain on track of competition to achieve desired goal in international trade. In order to achieve our cherished goal of achieving consumer satisfaction we extend our hand in the following sector:
? Trade Finance
? Small & Medium Business
? House Building loan
? Consumer Credit
? Transport Loan
? International Trade
? Project Financing
? Lease Financing
? Financing for BMRE
? Agricultural loan
? Special finance for non-traditional item
? Syndication Finance
4.6 Mood of Finance that we provide
? Secured Overdraft: For Work Order, General purpose etc.
? Cash Credit (Hypothecation)
? Cash Credit (Pledge)
? Letter of Credit
? Back to Back L/C
? Loan against Trust Receipt
? Loan against Import Merchandise
? Bank Guarantee
4.7 Retail Products: Standard Bank Ltd.
Consumer financing products are
Ñ Salary loan scheme
Ñ Car/auto vehicles loan
Ñ House renovation loan
Ñ Household durables loan
Ñ Self employed professional loan
Ñ Land purchase loan
Ñ Marriage loan
4.7.1 Salary loan scheme
This scheme will cover all salaried executives/officers having confirmed / permanent job in any of the following organizations:
– Government Organizations
– Semi Government & autonomous bodies
– Banks, well-established and reputed insurance companies and any other alike financial institutions.
– Multinational companies, Large NGOs, Aid Agencies, UN Bodies.
– Large Private organization having corporate structure.
– Teachers of reputed Universities, Colleges & Schools.
– Hospitals, Pathology Labs, Air lines, 5 Star Hotel & Restaurants.
– Length of service: Minimum 2 (two) years for type A,B,C
– Minimum Monthly Salary: TK. 20,000 (Twenty Thousand) Gross.
– Loan limit: ranges up to 2.00 Lac but not exceeding 3 (three) times of gross salary.
– All other conditions as stated in serial 1 to 13 to be followed.
4.7.2 Auto loan (car, auto-rickshaw, micro-bus, taxi, pick-up van Features
§ Loan amount ranges from Tk. 1.00 Lac to 10.00 Lac
§ Debt equity ratio 60:40.( Bank contribution 60% & Client 40%)
§ Repayment tenure12, 24, 36, 48 or60 months.
§ Loan amount excludes insurance, Vat, registration etc.
§ Option of pre-paying after a minimum of 6 months from loan disbursement.
§ The car /auto will be registered in joint name where in Standard Bank Ltd. Will be the first party. Customer will bear the insurance charges.
§ All other conditions as stated in serial 1 to 13 to be followed.
4.7.3 Self employed professional loan
§ Self employed professional Loan is a loan facility offered by the Retail Banking Division to facilitate the registered Doctors, Dentists, Pathologists, Engineers, Architects ,Scientists, Chartered accountants who are salaried as well as self employed.
§ Minimum of 3 years continuous service experience.(Both salaried & self employed)
§ Age-30 years to 57 years.
§ Monthly Income- Tk. 15,000/- gross. (Minimum).
§ Maximum Limit TK. 5.00 Lac.
§ Maximum loan upto 10 times of gross salary or net income of self-employed.
§ All other conditions as stated in serial 1 to 13 to be followed.
4.7.4 Marriage loan
Marriage Loan is a personal loan facility offered to executives/officers intends to marry to incur his/her marriage expenditure or their sons and daughters.
? Limit: Maximum Tk. 2.00 lac.
? Age: 25 years to 57 years.
? All other conditions as stated in serial 1 to 13 to be followed.
No marriage loan will be provided against 2nd Marry.
4.7.5 Household durables loan
§ Household durable loan is a personal loan offered to salaried /self employed persons to make their wishes true for purchasing computer, Refrigerator, A.C., T.V., Motorcycle, Washing Machine etc.
§ All other conditions & eligibility as stated in serial 1 to 13 to be followed.
§ Limit: Minimum Tk. 20000/- Maximum Tk. 1.00 Lac
§ Product quotation to be obtained.
4.7.6 House renovation loan
§ House renovation Loan scheme is a Personal Loan facility offered to salaried/self-employed persons to furnish & renovate their house.
§ Limit: Maximum: Tk. 4.00 lac. Debt equity ratio 50:50
§ Applicant must be owner of the land & building.
§ The house must be situated at Cities.
§ Age Limit: 30 years to 60 years.
§ All other conditions as stated in serial 1 to 13 to be followed.
4.7.7 Land purchase loan
– Land purchase loan scheme is a personal loan facility offered to salaried self-employed persons to purchase lands in the city areas.
– Limit maximum TK. 10.00 Lac
– Applicant must be purchaser of the land.
– The land will be mortgaged to the Bank as per registration Act.
– Debt equity Ratio 50:50
– All other conditions as stated in serial 1 to 13 to be followed.
4.7.8 Lease Finance
Standard Bank Limited offered Lease Finance facilities to its valued client’s with a view to facilitate client’s to acquire equipments and machineries without investing any fund in spite of paying fixed lease rentals. Fixed lease rentals can be tailored both in terms of amount and timing to the profit and cash flow position of the Lease Holder. At the end of the lease contract the lease assets back to the client with a nominal and depreciated value.
4.8 Price: Loan
|
Types of Loan ( Effective Form 03 November 2007) |
|||
|
Agriculture/Agro based/ Agro processing |
1 |
9.00% |
|
|
Term loan on large & Medium Scale Industry |
2 |
15.00% |
|
|
Term loan on small Industry |
3 |
15.00% |
|
|
Working Capital On Industry |
Working Capital On large & Medium Scale Industry |
4(a) |
15.00% |
|
Working Capital On small Industry |
4(b) |
15.00% |
|
|
Export |
5 |
7.00% |
|
|
Commercial Loan |
6 |
15.00% |
|
|
Housing Loan |
7 |
15.00% |
|
|
Consumer Credit |
8 |
16.00% |
|
|
Credit Card |
9 |
Not Applicable |
|
|
Loan to NBFIs |
10 |
16.00% |
|
|
Others |
11 |
15.00% |
|
6.9 Services: Standard Bank Ltd.
Standard Bank provide different services
1. Remittance Service
2. Locker Service
3. Utility Bills collection Services
-
-
- T&T Bill Collection
- PDB Electricity Bill
- DESCO Bill Collection
- Rural Electricity Board (REB) Bill Collection
-
(Revised Schedule of Charges w.e.f. 17.12.2008)
|
Sl. No. |
Type of Services |
Nature of Charges |
Revised Rate of Charges |
|
|
|
|
|||||
|
1 |
Current Account |
Service Charge / Incidental Charge |
|
|
|
|
A/C Closing Charge |
|
|
|||
|
2 |
Savings Account |
Service Charge / Incidental Charge |
|
|
|
|
A/C Closing Charge |
Tk.100/- |
|
|||
|
3 |
STD Account |
Service Charge / Incidental Charge |
@Tk.300/- half yearly on each A/C irrespective of balance (for rural branches Tk.150/- half yearly) except Employees A/C |
|
|
|
A/C Closing Charge |
Tk.100/- |
|
|||
|
4 |
Scheme Account |
A/C Closing Charge |
Tk. 300/- half yearly on each A/C irrespective of balance (for Metropolitan Area) (for Rural Branches Tk.200/- half yearly) except Employees A/c |
|
|
|
5 |
Standing Instruction |
Charge |
Tk.150/- |
|
|
|
6 |
Locker & Save Custody |
Small Size |
Tk.200/- half yearly on each A/C irrespective of balance (for Metropolitan Area) (for Rural Branches Tk.150/- half yearly) except Employees A/C |
|
|
|
Medium Size |
Tk.2000/- P.A. |
|
|||
|
Large Size |
Tk.3500/- P.A. |
|
|||
|
Security Money (Refundable) |
Tk.3500/- per locker |
|
|||
|
7 |
Issuance of Solvency Certificate |
Charge |
Tk.200/- per case |
|
|
|
8 |
Supply of Original Statement of Account |
Charge |
Free (For each monthly/quarterly), Tk.50/- other than above |
|
|
|
Mail Charge |
Tk.50/- per Statement within Bangladesh and outside Bangladesh Tk.50/- plus at actual postage. |
|
|||
|
9 |
Issuance of Cheque Book |
Charge |
Tk.1.00 per leaf for CD/STD and Tk.0.50 per leaf for SB Account (except Employees A/C) |
|
|
|
10 |
Issuance of Foreign Currency Balance Certificate |
Charge |
Tk.100/- per certificate |
|
|
|
11 |
Local Collection of Cheques (where there is clearing house) |
Commission |
Free |
|
|
|
Local Collection of Cheques (where there is no clearing house) |
Charges |
At actual Min. Tk.50/- per case |
|
||
|
12 |
Bounce cheque drawn on us (cash, clearing or transfer) |
Charges |
Tk.100/- per instance |
|
|
|
Local currency cheque returned unpaid sent on collection |
Charges |
Tk.100/- per instance |
|
||
|
13 |
Collection of outstation cheques/bills (clean / documentary) |
Commission |
|
|
|
|
Up to Tk.25000/- |
0.20%, Min. Tk.100/- |
|
|||
|
Tk. 25001/- to 100000/- |
0.20%, Min. Tk.100/- |
|
|||
|
Tk.100001/- to 500000/- |
0.10%, Min. Tk.200/- |
|
|||
|
Over Tk.500000/- |
0.05%, Min Tk.500/- Max.2500/- |
|
|||
|
Postage (Registered) |
At actual, Min. Tk.50/- |
|
|||
|
Telex/Telegram Charges |
At actual, Min. Tk.50/- |
|
|||
|
Telephone |
|
|
|||
|
14 |
Remittance -Inland (DD/TT/MT issuance) |
Commission |
0.15%, Min. Tk.50/- |
|
|
|
Additional Charges for TT (Postage) |
At actual |
|
|||
|
Telex/SWIFT |
At actual, Min. Tk.40/- |
|
|||
|
Telephone/Fax |
Tk.50/- |
|
|||
|
Cancellation of DD/TT/MT/PO |
Charge of Cancellation |
Tk.100/- |
|
||
|
Postage / Courier |
Tk.50/- |
|
|||
|
Telex/SWIFT/Fax |
Tk.50/-, up to Tk.1000/- Tk.100/- above Tk.1000/- |
|
|||
|
Issuance of duplicate instrument |
Charge for issuance |
Tk.100/- Plus actual Telex or Postage Charges incurred there against |
|
||
|
Issuance of Payment Order |
Charge for issuance |
Up to Tk.1.00 lac Tk.25/- |
|
||
|
Up to Tk.5.00 lac Tk.60/- |
|
||||
|
Above Tk.5.00 lac Tk.100/- |
|
||||
|
15 |
Duplicate issue of FDR |
Charge |
Tk.200/- |
|
|
|
16 |
Issuance of Bangladesh Bank Cheque at the request of the client |
Charge |
Tk.200/- per instance |
|
|
|
17 |
Purchase of Cheques and Inland Bills |
Commission |
Up to Tk.25000/- @Tk.0.25% Min. Tk.100/- |
|
|
|
Above Tk.25000/- to 1.00 lac @0.25% Min. Tk.200/- |
|
||||
|
Above Tk. 1.00 lac to Tk.5.00 lac @0.25% Min. Tk.300/- |
|
||||
|
Above Tk. 5.00 lac to10.00 lac @0.10% Min. Tk.500/- |
|
||||
|
Above Tk.10.00 lac @0.10% Min. Tk.1000/- |
|
||||
|
Postage (Registered) |
At actual Min. Tk.25/- |
|
|||
|
Telegram |
At actual Min. Tk.50/- |
|
|||
|
Telex / Fax |
At actual Min. Tk.50/- |
|
|||
|
Telephone |
At actual Min. Tk.50/- |
|
|||
|
Interest |
Interest to be charged as per lending rate from date of purchase up to the date of realization of proceeds and handling charges Tk.500/- |
|
|||
|
18 |
Balance Confirmation Certificate |
Charge |
Half yearly – Free Yearly – Free
For more then two times in a year, Tk.200/- for issuance of each Certificate |
|
|
|
19 |
Certificate for BO A/c |
Charge |
Tk.100/- |
|
|
4.10 Deposit Products: Prime Bank Ltd.
Bank is the largest mobilize of surplus domestic savings. For poverty alleviation, we need self employment, for self-employment we need investment and for investment we need savings. In the other words, savings help capital formations and the capital formations help investments in the country. The investment in its turn helps industrialization leading towards creation of wealth of the country. And the wealth finally takes the country on road to progress and prosperity. As such, savings is considered the very basis of prosperity of the country. The more the growth of savings, the more will be the prosperity of the nation.
The savings rate in Bangladesh is one of the lowest in the world. In order to improve the savings rate, Financial Institutions responsible for mobilization of savings should offer attractive Savings Schemes so that the marginal propensity to save increases. The savings do not, of course, depend only on the quantum of income but largely depend on the habit of savings of the people.
Interest rate of Savings Deposit Account is 6.00% for the year 2008.
Prime Bank have formulated following Deposit Scheme
1. Contributory Savings Scheme
2. Monthly Benefit Deposit Scheme s
3. Education Savings Scheme
4. Fixed Deposit Scheme
5. Short Term Deposit
6. Lakhopati Deposit Scheme
7. Double Benefit Deposit Scheme
8. Foreign Currency Account
9. Resident Foreign Currency Deposit Account
10. Non-resident Foreign Currency Deposit Account
11. Non-resident Taka Account
12. Non-resident Investors Taka Account
13. House Building Deposit Scheme
14. Prime Millionaire Scheme
4.10.1 Rate of Fixed Deposit
This type of deposit should be kept for a fixed term or period. Prime Bank Limited deals with the following terms deposit.
|
Sl. No. |
Particulars |
Interest Rate |
|
|
1 |
1 (One) month |
7.50 % |
|
|
2 |
3 (Three) months |
||
|
i) |
Below Tk. 1.00 crore |
11.50 % |
|
|
ii) |
Tk. 1.00 crore & above but below Tk. 5.00 crore |
13.00 % |
|
|
iii) |
Tk. 5.00 crore & above |
13.00 % |
|
|
3 |
6 (Six) months |
||
|
i) |
Below Tk. 1.00 crore |
11.50 % |
|
|
ii) |
Tk. 1.00 crore & above but below Tk. 5.00 crore |
13.00 % |
|
|
iii) |
Tk. 5.00 crore & above |
13.00 % |
|
|
4 |
1 (One) year & above |
||
|
i) |
Below Tk. 1.00 crore |
12.00 % |
|
|
ii) |
Tk. 1.00 crore & above but below Tk. 5.00 crore |
13.00 % |
|
|
iii) |
Tk. 5.00 crore & above |
13.00 % |
|
N.B. For Senior Citizenship Scheme 0.50% higher rate may be offered.
4.10.2 Short Term Deposit
· A short term deposit (STD) account is a running account with amounts being paid into and drawn out of the account continuously.
· These accounts are called Demand Deposits or Demand Liabilities since the banker is under obligation to pay the money in such deposits on demand
· These accounts are generally opened by Business Organization, Public Institution, and Corporate Bodies.
· An STD account may be opened by an individual person.
· It is an interest bearing deposit. Interest is calculated on daily basis as per Banks Prescribed Rate and is credited to account on half yearly basis.
Current interest rate on STD account is presented in the following table:
N.B. For the Senior Citizenship Scheme 0.50% higher rate may be offered.
4.10.3 Monthly Benefit Deposit Scheme
-This is a Deposit Scheme where the depositor gets monthly benefit out of his deposit.
-The scheme is designed for the benefit of the persons who intend to meet the monthly budget of their families from the income out of their deposit.
-Investment of fund of Trusts and Foundations, which award monthly scholarships/ stipends to students, etc.
The salient features of the Scheme are given below
1. Deposit of Tk. 25,000.00 (Taka twenty five thousand) and multiples thereof, but maximum Tk. 25, 00,000/- (Taka twenty-five lac) shall be acceptable under the Scheme.
2. The Deposit shall be for a period of 5 (Five) years. The Principal amount is refundable on maturity.
3. Profit shall be paid on monthly basis @ Tk. 1,000.00 per Tk. 1, 00,000.00.
4. Payment of monthly profit shall start from the subsequent month after a clear minimum gap of 30 days from date of deposit.
5. In case of death of a depositor, the account shall cease to be operative and the amount deposited so far shall be paid to the nominee, and in the absence of nominee, to the legal heirs of deceased as per rules in force.
6. Normally, the deposit will not be encashable before 5 (Five) years. But if any depositor intends to withdraw his deposit before maturity due to certain unavoidable reasons, he would be allowed to do so in the following manner:
a) No benefit including interest shall be allowed for pre-mature encashment within one year.
b) If the accounts / deposits are closed/ encashed after one year of its opening, benefit shall be allowed on the deposit at existing normal Savings Deposit rate.
c) If the amount of monthly profit already paid exceeds the amount payable at normal Savings rate, the difference shall be realized from the principal deposit amount, if and when necessary.
7. Separate Application Form specially designed for the purpose shall be obtained duly filled in and signed by the depositor. In addition to this, the depositor must have a separate Savings Bank Account with the branch wherein the benefit on the amount so deposited shall be credited every month.
8. A specially designed Receipt shall be issued for the deposit under the Scheme in the same manner as issued in case of FDR.
9. The Receipt will not be transferable.
10. Advance against lien on such Receipt can be allowed up to 80% of the deposit bearing normal rate of interest prevalent at the time on Overdraft/ Loan.
11. During the period of such Overdraft/ Loan, the monthly benefit shall be credited to the concerned Overdraft/Loan.
12. Payment will be made after deduction of taxes as fixed by the Govt. from time to time.
13. In case the instrument is lost, the procedure for issuance of a duplicate will be the same as applicable in case of loss of FDR.
N.B. Senior Citizens will get 0.50% higher rate of interest as permissible for all other deposits of our Bank. Monthly benefit shall be Tk. 1042/- per Tk. 1, 00,000/- per month for Senior Citizens.
4.10.4 Double Benefit Deposit Scheme
01. The Scheme shall be implemented through all the branches of Prime Bank Limited.
02. Deposit of Tk. 25,000/- (Taka twenty five thousand) and multiplies thereof but maximum limit of Tk. 25, 00,000/- (Taka twenty five lac) at a time will be acceptable under the scheme.
03. The instrument shall be issued for 06 (six) years term.
04. At maturity after 06 (six) years double the amount of deposit will be paid to the depositor.
05. Photograph of Nominee, duly attested by the depositor, shall be obtained at the time of opening the account.
06. Normally no withdrawal will be allowed before maturity. But if any depositor intends to withdraw his deposit before maturity, the following rules will apply-
§ No benefit including interest/profit shall be allowed for pre-mature encashment within one year.
§ If the accounts / deposits are closed / encashed after one year of its opening, benefit shall be allowed on the deposit at normal Savings Deposit rate.
07. The instrument will be acceptable as collateral security against any investment subject to registering lien with the issuing branch.
08. In case of death of a depositor, the amount of instrument will be paid to the nominee, to the legal heirs of the depositor on production of succession certificate.
09. In case of instrument is lost the procedure for the issuance of a duplicate receipt will be the same as applicable in case of loss of FDR.
10. Under the scheme depositor can get free insurance facility.
11. Insurance coverage is only applicable to personal accident and serious illness related insurance policy.
12. Depositor can take loan against his/her deposit under this scheme.
At present no income tax will be deducted from the interest earned. But in future for any change in the government policy Bank reserves the right to deduct income tax.
4.10.5 Education Savings Scheme
The educational expenses particularly the expenses for higher education are sharply increasing day by day in our country. Sometimes, the children are deprived of getting the desired level of education because of the inability of the parents to meet their educational expenses. But the parents would not feel any difficulty to defray such expenses if a proper financial planning is made much ahead of time.
Moreover, we are receiving demands from the Islamic minded people of our country for an attractive Savings Scheme on the basis of Islamic Sariah so as to encourage them to save in Islamic way for education of their children.
With this end in view, Prime Bank Limited has introduced a Savings Scheme entitled “Education Savings Scheme” in accordance with the principles of Islamic Sariah i.e., on the basis of profit and loss sharing. The scheme provides a unique opportunity to the parents to make a future provision for the educational expenses of their children when they enter into Schools, Colleges and Universities out of the benefit of a small amount of savings with the Bank at an opportune moment.
The salient features of the Scheme are given below-
1. The Scheme shall be implemented through all our branches, though it is specially designed for Islamic Banking branches.
2. Deposit of Tk. 50,000/- and multiples thereof but maximum limit of Tk. 5, 00,000/- at a time will be acceptable under the Scheme.
3. A specially designed Receipt shall be issued for the deposit under the Scheme in the same manner as issued in case of FDR. Branches shall use the ESS receipts that used for existing scheme.
4. The instrument shall be issued for a period of 5 years term.
5. On maturity a lump sum amount of Tk. 85,382/- shall be payable or education allowance @ Tk. 1,854/- per month per Tk. 50,000/- shall be payable on the basis of deposit amount for next 5 years starting from the completion of the term as per following table. Income Tax @10% on interest may be deducted at source at the time of payment of lump sum amoun
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- To avail the monthly allowances the depositor is required to surrender the savings instrument to the Bank duly discharged with a written instruction to the Bank to pay the installments to his ward on monthly installment basis as stipulated in the scheme.
- Separate Application form specially designed for the purpose shall be obtained duly filled in and signed by the depositor.
- Photograph of the Nominee and Ultimate Beneficiary, if any, duly attested by the depositor, shall be obtained at the time of opening the account.
- Normally no withdrawal will be allowed before maturity. But if any depositor intends to withdraw his/her deposit before maturity, the following rules will be applicable:
a) No benefit including interest shall be allowed for pre-mature encashment within one year.
b) If the accounts/deposits are closed/encashed after one year of its opening, benefit shall be allowed on the deposit at normal Savings Deposit rate.
- The instrument will be acceptable as collateral security against any investment subject to registering lien with the issuing Branch.
- In case of death of the depositor, the amount of instrument will be paid to the nominee or, in the absence of a nominee, to the legal heirs of the depositor on production of succession certificate.
- But if the nominee after the demise of the depositor intends to continue the deposit to enjoy the monthly educational allowance for five years, as admissible under the rules of the scheme, the receipt should be surrendered to the Bank on maturity duly discharged by the nominee and duly authenticated by the legal guardian.
4.10.6 Lakhopati Deposit Scheme
Monthly Installment size, tenure and terminal value of the scheme will be as follows:
|
Monthly Installment Size (Taka) |
Tenure |
Amount to be paid after maturity (Taka) |
|
250/- |
15 years |
1,00,000/- |
|
500/- |
10 years |
1,00,000/- |
|
1,285/- |
5 years |
1,00,000/- |
|
2,400/- |
3 years |
1,00,000/- |
1. At present no income tax will be deducted from the interest earned. But in future for any change in the government policy Bank reserves the right to deduct income tax.
2. The depositor will have the option to choose any installment size and period at the time of opening of the account and will not be allowed to change the size of installment afterwards.
3. Account in the name of minors can be opened too under the Scheme as per standard procedure for minor accounts.
4. A person can open more than one account for any size of installment in any branch of the Bank.
5. The specified amount on maturity at any slab shall be paid after one month from the date of deposit of the final installment.
6. The installment shall be payable by the 8th day (in case of holiday the next working day) of every month. Advance payment of any number of installment is acceptable.
7. Normally no withdrawal shall be allowed before maturity, if any depositor intends to withdraw his/her savings due to certain unavoidable reasons before 3 years, 5 years, 10 years and 15 years, he/she will not be allowed any benefit if the premature encashment takes place before completion of 1 year. But the depositor shall be allowed interest on the prevailing Savings Deposit rate after completion of 1 year from the date of opening of the account.
8. When a depositor fails to deposit any installment, he/she will have to pay a fine 5% of the overdue amount payable at the time of depositing the next installment or Tk. 20/- whichever is higher.
9. If a depositor fails to pay 3 (three) consecutive installments he will have to pay 5% fine of the overdue installments to regularize the account. If he fails to pay more than 3 (Three) installments he will cease to remain under the purview of the scheme and the deposit will be treated as Savings Bank deposit and interest will be paid on the deposited amount at prevailing SB A/C rate subject to completion of 1 (one) year of its opening.
10. Loan may be allowed up to 80% of the deposited amount against lien on the same where the deposited amount shall be at least Tk. 50,000/- and the interest rate of the loan shall be as per prevailing commercial lending rate of the Bank.
11. In case of death of a depositor, the account will cease to be operative and the amount deposited so far shall be paid to the nominee, and in absence of nominee, to the legal heirs of deceased as per rules in force.
12. The Bank at its discretion may allow inter branch transfer of the A/C under the Scheme.
13. The clients are encouraged to give standing instructions to the Bank to deposit the monthly installments, debiting their CD/SB accounts maintained with the concerned Branch. In that case, no charge will be realized for such service.
14. Normally no statement of the account will be served to the depositor, in case of need of any depositor, charge @ Tk. 10/- per year / per statement shall be realized as cost of paper. This charge may be changed from time to time.
4.10.7 Prime Millionaire Scheme
The salient features of the Scheme are given below-
01. Monthly installment shall be Tk. 12,465.00 /Tk. 7,890.00 /Tk. 4,570.00 for the tenor of 5/7/10 years respectively
02. Terminal amount on maturity shall be Tk. 10.00 lac.
|
Size of monthly deposit (in Taka) |
Investment Tenor (in Year) |
After the investment Tenor the terminal value of the Scheme (in Taka) |
Pension size of installment according to the years Invested (in Taka ) |
|
12,465/- |
5 |
1,000,000/- |
21,748/- |
|
7,890/- |
7 |
1,000,000/- |
17,137/- |
|
4,570/- |
10 |
1,000,000/- |
13,786/- |
03. Income Tax on interest amount shall be as per Government rule on taxation and the Bank reserves the right to deduct Income Tax.
04. The depositor will have the option to choose any installment size at the time of opening of the A/C. and will not be allowed to change the size of installment afterwards.
05. A person can open more than one account.
06. The installment shall be payable by the 8th day (in case of holiday the next working day) of every month. Advance payment of any number of installments is acceptable.
07. Normally no withdrawal shall be allowed before maturity, If any depositor intends to withdraw his/her deposit due to certain unavoidable reasons before maturity (Min after one year) interest on the prevailing Savings Deposit rate may be allowed.
08. When a depositor fails to deposit any installment, he/she will have to pay a fine @5% of the overdue amount payable at the time of depositing the next installment or maximum Tk. 500/- .
09. When a depositor fails to pay 3 (Three) consecutive installment at any point of time before 2 years term, the customer will cease to remain within the purview of the scheme and scheme will be treated as a Savings Bank deposit and interest will be paid on the deposited amount at prevailing SB A/C rate subject to completion of 1 (One) year of its opening.
10. In case of death of a depositor, the A/C. will cease to be operative and the amount deposited so far shall be paid to the nominee, and in the absence of nominee, to the legal heirs of deceased as per rules in force.
11. The Bank at its discretion may allow inter branch transfer of the A/C under the Scheme.
12. The clients are encouraged to give standing instructions to the Bank to deposit the monthly installments, debiting their CD/SB accounts maintained with the concerned Branch. In that case, no charge will be realized for such service.
13. Normally no statement of the account will be served to the depositor. Incase of need of any depositor, charge @Tk.10/- per year / per statement shall be realized as cost of paper.
4.11 Loan Products: Prime Bank Ltd.
Like Deposit Scheme, PRIMA BANK have formulated the following Loan Schemes:
Ñ House Building / Apartment Loan Scheme
Ñ Small and Medium Enterprise (SME)
4.11.1 General Loan Scheme
Depending on the various nature of financing, all the lending activities have been brought under the following General Loan
· Short term Loan
· Medium term Loan
· Long term Loan
The loans are allowed to individual/firm/industries for a specific purpose but for a definite period and generally repayable by installments fall under this head. This type of lending are mainly allowed to accommodate financing under the categories (i) Large & Medium Scale Industry and (ii) Small & Cottage Industry. Very often term financing for (1) Agriculture (ii) Others.
4.11.2 Lease Finance
Lease financing is one of the most convenient long term sources of acquiring capital machinery and equipment. It is a very popular scheme whereby a client is given the opportunity to have an exclusive right to use an asset, usually for an agreed period of time, against payment of rent. Of late, the lease finance has become very popular in almost all the countries of the world. An obvious advantage of the lease is to use an asset without having to buy it. The lessee is obligated to make lease payments until the expiration of the lease agreement, which corresponds to the useful life of the asset. In a capital scarce economy like ours, Lease Financing is suitable for firms to acquire Capital Machinery, Equipments, Medical Instruments, and Automobiles etc. And thereby employ their own resources more advantageously in some other investments. Lease financing also helps a firm to reap significant economic benefit through tax saving and by reducing the risk of the equipments becoming obsolete due to the technological advancement.
4.11.3House Building / Apartment Loan Scheme
Loans allowed to individual/enterprises for construction of house (residential or commercial) fall under this type of advance. The amount is repayable by monthly installment within a specified period. Such advances are known as Loan (HBL-GEN).
Loans allowed to our Bank Employees for purchase /construction of house shall be headed Staff Loan (HBL-STAFF).
4.11.4 Small & Medium Enterprise (SME)
Small and Medium Enterprise Credit Scheme” has been formulated as follows. It may also be mentioned that USAID has approved our bank to receive their guarantee facility to lend money to Small and Medium business Houses. 50% of losses, if any, be paid by USAID
4.11.4.1 Small Enterprise
Small Enterprise refers to those enterprises: –
-where goods are produced, recycled, repaired or traded in traditional way;
-where total bank investment is limited to Tk.250, 000;
-where 10 or less workers are engaged on wages or commission basis.
4.11.4.2 Medium Enterprise
Medium Enterprise refers to those enterprises:-
-Where goods are produced, recycled, repaired or traded applying some capital machinery;
-Where 20 or less people are engaged on wages or commission basis;
-Where total bank investment does not exceed Tk.75, 00,000.
-The net fixed assets (excluding land and buildings) of borrowers may not exceed Tk. equivalent of US $250,000.
4.11.4.3 Loan Ceiling
1. For small enterprise : Maximum Tk.2, 50,000/-
2. For medium enterprise : Maximum Tk.75, 00,000/-
No loan proposal for less than Tk.1, 00,000/- be entertained.
Purpose
|
Working capital; |
Delivery Van / Transport for business purpose; |
|
Capital machinery; |
Refurbishing office/Business premises. |
4.11.4.5 Mode of Finance
1. Cash Credit (Hypo/Pledge)
2. Hire purchase/ Lease Finance
3. Term Loan.
4.11.5 Consumer Credit Scheme
In order to provide financial assistance to the limited income group for raising their standard of living by acquiring domestic durables like Refrigerator, T.V., Washing machine, Furniture, Computer, Motor Car, etc., we have introduced a Scheme to improve the quality of life particularly of the fixed income earner of the society and this scheme is known as Consumer Credit Scheme.
4.11.6 Eligibility for Credit
The persons having confirmed/permanent job in any one of the following organizations and age between 20 to 50 years are eligible for availing of Credit facilities under the Scheme.
ü Government Organization
ü Semi-Government and Autonomous Bodies
ü Banks, Insurances Companies or any other Financial Institutions
ü Armed Forces, B.D.R, Police and Ansar
ü Private Organizations having corporate structure
ü Teachers of Universities, Colleges and Schools
Besides the above, Professionals like Doctors, Engineers, Architects, Lawyers, Journalists, Chartered Accountants; Self Employed Business Executives are also eligible for enjoying credit facilities under this scheme subject to the providing of Bank Guarantee or Insurance Guarantee for the amount of Credit.
4.12 Consumer Credit Products
4.13 Hire Purchase
Hire Purchase is a type of installment credit under which the Hire Purchase agrees to take the goods on hire at a stated rental, which is inclusive of the repayment of Principal as well as interest for adjustment of the loan within a specified period.
In order to contribute to the development of the Capital Market of the country Prime Bank Limited extends credit facilities against pledge of Shares to the individuals as well as to the Member of DSE & CSE.
5.15 Interest Rate: Prime Bank Limited
4.16 Services: Prime Bank Ltd.
4.16.1 Master Card
Prime Bank Limited obtained Principal Membership of Master-Card International in the month of May 1999. Within a period of 6 months, the bank successfully launched Master Card-Credit Card which created a new dimension in its customer service and consumer financing.
The Special feature of the Prime Bank Master Card is that its bears the card holder’s photo on the card, which is the first of its kind in Bangladesh and adds security against misuse. Prime Bank Limited issues 4 types of cards. These are Gold Local & International and Silver Local & International. Local cards can be used in Bangladesh only.
4.16.2 One Stop Utility Services Scheme
Like any other country of the world, the people living in the urban areas of our country lead a very busy life. Time is very valuable to them. Despite this, they are to waste their valuable time at the counter of different Banks and other Institutions for payment of their monthly bills of different utility services like Electricity, Telephone, Water, Gas etc. They, as such, face enormous difficulties for payment of their monthly bills in time. Such inconveniences of the urban people can be removed by making an arrangement to collect all the bills of various utility services at One Point.
Scope of Services
With this end in view, Prime Bank Limited has introduced a Scheme entitled “ONE STOP UTILITY SERVICES SCHEME”. The scheme is designed to provide all the required services to the customer in making payment of their following bills on their behalf from the counter of the Bank:
· To pay Electricity Bills
· Cash deposit in his/her account at any branch of the Bank irrespective of location.
· Cash deposit in other’s account at any branch of the Bank irrespective of location.
· Transfer of money from his/her account with any branch of the Bank.
Any amount can be deposited or transferred under Prime Line. In the system, however, at present there is a limit for cash withdrawal through bearer or by account holder himself.
4.16.3 Online Branch Banking Service
ONLINE BRANCH BANKING SERVICE is designed to serve its valued clients. Under this system, you shall be able to do the following type of transactions:
Ø Cash withdrawal from your account at any branch of the Bank.
Ø Deposit in your account at any Branch of the Bank.
Ø Transfer of money from your account to any other account with any Branch of the Bank.
Comparative Scenario with Competitive Bank
5.1 Interest Rate
A comparative picture drawn on interest rate on various deposit & loan product-
From the above Graph it has been observed that Banks are offering a very close rate regarding Deposit & Loans.
5.2 Product & Services
In case of Deposit product/scheme BCBL are not diversifying their product/special scheme to the client who are belong to various social ground/culture/group etc. The competitive banks innovating product to attract the new customers as well as to satisfy existing client. And there a huge opportunity for BCBL to launch new featured product to attract more customer.
In our country most of the Bank providing Consumer Credit, and the approximate recovery rate is more or less 98% from which a Bank can earn a huge return. But at present BCBL not operating in that section and need to take that point in a great consideration. Additionally on the ground of services area BCBL are on back footed comparing to other bank. BCBL providing only general services. But today customer needs are growing enormously. So BCBL needs to expand its service area like Credit Card and ATM Card and online banking operations for clients, Merchant Banking etc.
BCBL are on Back foot compare to other Bank on following factor-
1. Retail banking
2. Introduce special corporate scheme
3. ATM
4. Credit card and debit card system
5. Online Banking
6. Merchant banking
5.3 Opportunity should pick up by BCBL
· Opportunity in retail banking lies in the fact that the country’s increased population is gradually learning to adopt consumer finance. The bulk of our population is middle class. Different types of retail lending products have great appeal to this class. So a wide variety of retail lending products has a very large and easily pregnable market.
· A large number of private banks operating into the market in the recent time. In this competitive environment BCBL must expand its product line to enhance its sustainable competitive advantage. In that product line, they can introduce the ATM to compete with the local and the foreign bank. They can introduce credit card and debit card system for their potential customer.
· In order to reduce the business risk, BCBL has to expand their business portfolio. The management can consider options of starting merchant banking or diversify into leasing and insurance sector.
· The activity in the secondary financial market has direct impact on the primary financial market. Banks operate in the primary financial market. Investment in the secondary market governs the national economic activity. Activity in the national economy controls the business of the bank.
· In addition of those things, BCBL can introduce special corporate scheme for the corporate customer or officer who have an income level higher from the service holder. At the same time, they can introduce scheme or loan for various service holders. And the scheme should be separate according to the professions, such as engineers, lawyers, doctors etc.
·
Future Prospect, Recommendation
and
Conclusion
6.1 Future Prospect
Amid many challenges, adverse economic conditions and market scenario during the year, the Bank maintained its growth trend through the indicators like, profitability, deposit mobilization, asset creation and profitability, deposit mobilization, asset creation and network expansion. Basing on convincing reasons, we strongly believe that in the coming years also, the Bank strongly believes that in the coming years also, the Bank would be able to attain its earning capacity at an accelerated growth rate.
Bank is also marking a headway for introduction of Credit Card and ATM Card and online banking operations for clients, bank intends to enter into agreement with reputed Exchange Companies in USA, UK and UAE for safe and steady flow of foreign remittances into the country from Bangladesh expatriated working at those places.
We can safely say that we have well positioned ourselves in the banking arena of Bangladesh with diversified products and financial services to seize the opportunities. New custom-friendly products are being evolved in the days to come.
6.2 Recommendation
The banks are actually service organizations. The main objectives of the world famous and successful banking organizations are to making of profit through addressing the clients time to time with new pieces of service instruments. However my little experience earned through this internship program took me to customers varying demands. I had several frank discussions with the clients and officials, which has helped me to know about the aforesaid findings and draw the following recommendation.
As soon as possible the bank should launch more branches in Dhaka city as well as in other cities in Bangladesh.
Now a day the world is going vary fast. Now most of the bank provides online services. So that BCBL can take more initiative about that.
One of the business strategies is promotion. Successful business depend how they can promote their products or services to the customer. In this connection to improve the business status bank should introduce more promotional programs.
In the total banking system it is necessary to implement modern banking process instead of traditional system. It should be more computerized.
All the foreign banks and other private commercial bank have Customer relation/support/service officer in all branches. They sit in front of branches they solve customers problem, answer inquiry of customers etc. BCBL should appoint customer service officer in all branches.
BCBL should improve its service quality; otherwise it will fall back of other private commercial bank.
Use of effective management information systems.
To deliver quality service top management should try to mitigate the gap between customer’s expectation and employee’s perception.
Use appropriate techniques in evaluating customer need and convenience professionally
BCBL needs more effective discipline for all branches.
It has some inefficient employee, so that management can look after that.
6.3 Conclusion
BCBL is one of the problem banks in Bangladesh. And they are doing well gradually. But it has some draw back. I strongly believe that the banking services marketing are different from goods marketing in a significant way. So that, it can improves totally different strategy and tactics. And you can do marketing when you have signified product & Service.
To analyze the BCBL regarding to service & product we found that, to win the customer satisfaction BCBL need to improve their service quality, enhance technological service and launch new product which will generate inflow to the Bank.
6.4 Reference
Journals:
Ñ BCBL Annual Report
Ñ Operational manual
Ñ Papers served from BCBL
Ñ Different types of Brochures of BCBL
Internet:
Ñ http://www.bcbl-bd.com
Ñ http://www.bangladeshinfo.com
Ñ http://www.bangladesh-bank.org
Ñ http://www. primebankbd.com