Total Banking System of Jamuna Bank Limited

1 | P a g e

1.0 Introduction

It’s simple enough to say that Bank is financial organization that deals with money. But it is the

precise most definition about bank. In modern age it is impossible to think a country without

bank. Banks play diversified role in an economy. Banking plays very significant contribution

towards socio-economic development of a country. This sector is considered to be like the life

blood the economy as well. As one of the most important components of the financial system it

forms the core of the money market and plays very pivotal role in mobilizing resources for

productive investments in a country which in turn contributes to economic development. The

efficiency of the sector is very important for overall development of the country. The most

important task that is done by a bank is building of capital. That is the key factor of the

development of an economy. An Industrialized nation’s build their industrial sector with the help

of banking sector. The growth of the economy also depends on the performance of the banking

sector. Banks secure money of the society. Government takes various monetary policies. These

policies are implemented with the help of banking sector. It is impossible to do foreign trade

without the help of bank. Banks provide services that help the business sector a lot to carry on

the business.

Jamuna Bank Limited (JBL) is a Banking Company registered under the Companies Act, 1994

with its Head Office at Chini Shilpa Bhaban, 3 Dilkusha C/A, Dhaka-1000. The Bank started its

operation from 3rd June 2001. Jamuna Bank Ltd. is a third generation bank in Bangladesh. It is

playing an important role to develop the business sector. The growth of this bank is very good.

Its motto is to provide a prompt and quick service to the clients. Jamuna Bank Ltd. has

implemented well structured online banking systems that make it easier to provide prompt

services to the customer.

This report has been prepared in the light of practical as well as theoretical knowledge.

Also it is prepared under the guidance and supervision of the core teacher. During the internship

program I have got a good idea about the bank and that is depicted in the report.

2 | P a g e

1.1 Origin of the Report

The BBA (Bachelor’s of Business Administration) internship program is required course for the

students who are graduating from East West University. It is a three credits hour course with the

duration of 3 Months. Students who have completed all the required courses are eligible to for

this course. In this internship program, I was attached to do my internship by rotation to all

departments of Jamuna Bank Limited, Shatinagar Branch, Dhaka. Both the academic supervisor

assigned me on this project. The report is on “Overall Banking System of JAMUNA Bank

Limited”.

1.2 Objective of the Study

The objectives of the report is to make us known the practical situation of commercial banks of

Bangladesh in overall activities and prepare me to face the complex situation of banking in this

country .The primary objective of this report is to commonly with the requirement of JBL.

However the objectives of this study are something broader. Objectives of the study are

summarized in the following manner.

General objectives:

The general objective is to prepare and submit a report on “Overall Banking System of Jamuna

Bank Limited”.

3 | P a g e

Specific objectives:

To apply theoretical knowledge in the practical field.

To present an overview of JAMUNA Bank Ltd

To develop our skill on the banking sector

To earn valuable knowledge about the general banking system

To know the customer service of banking sector.

To observed the practice of modern technology in banking sector.

Practical knowledge about transaction.

To assess the strength and weakness.

To identify possible areas of improvement

1.3 Methodology of the study

At the time of my internship period, I tried to use both primary and secondary data that I have

gathered from different sources. For preparing this report primarily I got some data from face to

face conversation of different employees of JBL Shantinagar branch and some from different

reports and features of the bank. Sometime I have undergone group discussion, asked some

questionnaires to the responsible officer of that work and interviewed with some of them. I

observed different parties and their transaction from a very close eye .all of this observation and

data are included in this report.

Source of data:

These sources are as follows:

Primary source:

Primary data are collected through two ways. These are:

4 | P a g e

a) Questionnaire: some primary data are collected by taking interview and by discussion with the

executives and officer of JBL.

b) Observation: Here primary data are collected through spending three month in the JBL during

the working hour. Here I observed the total banking process of JBL.

Secondary source:

Secondary data are collected from the following sources:

a) annual reports of JBL

b) Published documents

c) Official files

d) Data available with the website of JBL.

e) Different publication of Bangladesh bank and Bangladesh economic reviews.

f) Outlets of Bangladesh Institute of Bank Management.

1.4 Scope of the study

The report commences with the outline of the organization in focus, presenting the mission and

vision, individual department job responsibilities. For conducting this study an overall

knowledge of the total banking system will necessary because the departments banking are

linked with each other due to some partial proceeding. The scope of the organization part covers

the organization structure, background, objective, function, departmentalization and business

performance of JBL as a whole.

The main part covers the operation scenario of a branch of JBL. This refers how the bank helps

the customer in general banking and foreign exchange banking. It also covers loan and advances

facilities of JBL, credit appraisal system, and activities of credit department.

5 | P a g e

1.5 Limitation of the Study

Three months is not enough to know about commercial banking operation through I have been

received maximum assistance from the every individual of the JBL Shantinagar Branch.

Definitely, I could not produce an outstanding report for the time limitations. Due to the time

limit, the scope and dimension of the study has been curtailed.

The Term paper is likely to have following limitations:

Since the ideal size of data could not be taken, suggested operating process may not be useful

without appropriate modifications.

Due to shortage of time, the accuracy of information may not have been completely perfect.

The Operating Process is a theoretical suggestion. Only a practical application of this may

justify its effectiveness that could not be done due to time limitation.

Lack of comprehension of the respondents was the major problem that created many

confusions regarding verification of conceptual question.

Confidentiality of data was another important barrier that was faced during the conduct of

this study. Every organization has their own secrecy that is not revealed to others. While

collecting data on JBL, personnel did not disclose enough information for the sake of

confidentiality of the organization.

Rush hours and business was another reason that acts as an obstacle while gathering data.

6 | P a g e

7 | P a g e

2.1 Overview of Jamuna Bank

Jamuna Bank Limited is a banking company registered under the companies Act 1994 with its

Head office at Chini Shilpa Bhaban (2nd floor, 3rd floor & 8th floor), 3, Dilkusha, C/A, Dhaka-

1000. The bank started its operation from 3rd June 2001.

Jamuna Bank Limited is a highly capitalized new generation Bank with an Authorized

Capital and Paid-up Capital of Tk.10000 million and Tk.4488 million respectively. The Paid-up

Capital has been raised to 840 million and the total equity of the bank stands at 8325 million as

on December 31, 2012.

JBL undertakes all types of banking transactions to support the development of trade and

commerce of the country. JBL’s services are also available for the entrepreneurs to set up new

ventures and BMRE of industrial units. The Bank gives special emphasis on Export Import,

Trade Finance, SME Finance, Retail Credit and Finance to Woman Entrepreneurs.

To provide clientele services in respect of international Trade it has established wide

correspondent banking relationship with local and foreign banks covering major trade and

financial centers at home and abroad.

Jamuna Bank Ltd., the only Bengali named new generation private commercial was established

by a group of winning local entrepreneurs conceiving an idea of creating a model banking

institution with different outlook to other the valued customers, a comprehensive range of

financial services and innovative products for sustainable mutual growth and prosperity. The

sponsors are reputed personalities in the field of trade, commerce and industries. The Bank is

8 | P a g e

being managed and operated by a group of highly educated and professional team with

diversified experience in finance and banking. The scenario of banking business is changing

environment. Jamuna Bank Ltd. Has already achieved tremendous progress within only two

years. The Bank has already ranked the top out as a quality service provider & is known for its

reputation.

Organizations are open system that needs careful management. Jamuna Bank discreetly pursues

the principles of openness, disclosure and compliance to regulatory authorities, transparency in

performance, integrity in dealings, ethics in banking and accountability to the shareholders in

corporate governance. Jamuna Bank is pledge-bound to keep it free from the clutches of loan

default culture. All our units are the centers of excellence. Our underlying commitment to

professionalism and a single-minded devotion to service to our customers characterizes our style

in all operations. We involve with the changing needs of our customers and the processes go on.

The Bank ensures orderly relations between clearly defined functions of the Board of Directors

and the management. Their role remains sharply bifurcated .The Board formulates policies and

frames procedures. Be management implements them and acts within norms. The management

enjoys full independence in managing the banking industry, especially its credit portfolio without

any undue influence from outside. It, however, functions in a reutilized, efficient, suitable and

dynamic way to foster progress, promote general welfare of the society and infuse its people to

serve the nation. In corporate governance, we strictly comply with the requirement of companies

Act-1994, Bank Companies Act 1991, rules and regulation of Bangladesh Bank and other

regulatory authorities.

9 | P a g e

2.2 Management Structure:

JBL is managed by highly professional people. The present Managing Director of the bank is a forward –looking senior banker having decades of experience and multi discipline knowledge to his credit both at home and abroad. He is supported by an educated and skilled professional team with diversified experience in fiancé and banking. The Management of the bank constantly focuses on the understanding and anticipating customers’ needs and offer solution thereof. Jamuna Bank Limited has already achieved tremendous progress within a short period of its operation. The bank is already ranked as one of the quality service providers & known for its reputation.

2.2.1 Board of Directors:

Mr. Kanutosh Majumder

Chairman

Al-haj M. A. KhayerDirector

Engr. A. K. M. Mosharraf Hussain Director

Engr. Md. Atiqur RahmanDirector

Mr. Golam Dastagir Gazi, Bir Protik

Director

Mr. Fazlur RahmanDirector

Al-Haj Nur MohammedDirector

Mr. Md. Tajul IslamDirector

Mr. Sakhawat, Abu Khair Mohammad

Director

Al-haj Md. Rezaul Karim AnsariDirector

Mr. Md. Belal HossainDirector

Mr. Md. Mahmudul HaqueDirector

Mr. Shaheen MahmudDirector

Mr. Md. Sirajul Islam VaroshaDirector

Mr. Gazi Golam MurtozaDirector

Mr. A. S. M. Abdul HalimIndependent Director

Narayan Chandra SahaIndependent Director

Chowdhury Mohammad MohsinIndependent Director

Md. Rafiqul IslamIndependent Director

Shafiqul AlamManaging Director

2.2.2 Audit committee

10 | P a g e

In line with the guidelines of Bangladesh Bank, an Audit Committee of the Board of Directors has been formed to assist the Board with regards to Audit and Internal Control system of the Bank.

Members

Mr. A. S. M. Abdul Halim, Independent Director & Chairman

Mr. Golam Dastagir Gazi, Bir Protik, Director

Al-haj Md. Rezaul Karim Ansari, Director

Mr. Md. Sirajul Islam Varosha, Director

Mr. Md. Rafiqul Islam, Independent Director

2.2.3 Executive Committee

All routine matters beyond delegated powers of Management are decided upon by or routed through the Executive Committee subject to ratification by the Board of Directors. The Chairman of this Committee is being selected by rotation. Currently, the Executive Committee of Board of Directors is constituted with the following members:

Members

Mr. Shaheen Mahmud, Director & Chairman

Alhaj M. A. Khayer, Director

Engr. Md. Atiqur Rahman, Director

Al-Haj Nur Mohammed, Director, JBL & Chairman, JBF

Mr. Md. Tajul Islam, Director

Mr. Sakhawat, Abu Khair Mohammad, Director

Mr. Md. Belal Hossain, Director

2.2.4 Higher Management

11 | P a g e

Shafiqul AlamManaging Director

Mirza Elias Uddin Ahmed

Deputy Managing Director

Mosleh Uddin Ahmed Deputy Managing

Director

A. K. M. Saifuddin Ahamed


2.2.5 Risk Management Committee

Members

Mr. Kanutosh Majumder, Chairman (BOD)

Engr. A. K. M. Mosharraf Hussain, Director

Mr. Fazlur Rahman, Director

Mr. Md. Mahmudul Haque, Director

Mr. Gazi Golam Murtoza, Director

12 | P a g e

2.2.6 Divisional Heads

Division Name and Designation

Credit Risk Management

Division

Md. Habibur Rahman

Senior Executive Vice President

1. Human Resources Division

2. PR & Brand Communication

Division

Mahbubul Huq Choudhury

Executive Vice President

Anti Money Laundering

Division

Khandaker Khalidur Rahman


Information & Communication

Technology Division

Ahmed Nawaz

Senior Vice President

Internal Control & Compliance

Division

Ahamed Sufi


Card & ADC Division

Mr. Md. Mohi Uddin


Financial Administration

Division

Ashim Kumer Biswas


Division Name and Designation

1. Board's Secretariat

2. Share Division

Malik Muntasir Reza Senior Vice President

Monitoring Division

Md. Belal Hossain


General & Common Services Division

S.M. Ashafuddoullah

Vice President

Capital Market Operation

M.M. Mostafa Bilal

Vice President

SME DivisionAshif Khan

Vice President

Risk Management

Division

Md. Shah Alam

Vice President

Law & Recovery Division

Abdul Awal KhanVice President

Banking Operation

Divsion

S M Jamal Uddin

Vice President

Credit Administration

Division

Md. Abul Bashar Mazumder

Vice President

13 | P a g e

Corporate Banking Division

Ahsan Tariq

Senior Assistant Vice President

Agricultural Loan Unit

Md. Mamtaz Uddin Chowdhury


NRB Banking & Foreign

Remittance Division

Abdus SobhanSenior Assistant Vice

President

International Division

Mohammad Shamsur Rahman


Trade Finance Processing

Centre

A.S.M. Humayun Kabir

Assistant Vice President

Retail Banking Division

Syed Serwarul Islam


Treasury Division

Md. Mehedi Hasan


Islamic Banking Division

Md. Ashaduzzaman

First Assistant Vice President

Offshore Banking Unit

Md. Nazmul Hassan


Marketing & Development

Division

Noor Nabi Khan

First Assistant Vice Presiden

14 | P a g e

2.3 Organogram of JBL

15 | P a g e

Chairman

Managing Director (MD)


Senior Executive Vice President


SVPSVP (Credit)SVP (HRD)SVP (Board Secretary)

Vice

SAVP

Senior Executive Vice President Senior Executive Vice President


SVPSVP (Credit)

Assistant Vice


Jr. Assistant Vice

Senior Executive

Executive officer

First executive officer

Officer

First Officer

2.4 Corporate Mission, Vision & Motto

2.4.1 Vision:

To become a leading banking institution and to play a pivotal role in the development of

the country.

To stand out as a pioneer banking institution in Bangladesh.

To contribute significantly to the national economy.

2.4.2 Mission:

The Bank is committed to satisfying diverse needs of its customers through an array of

products at a competitive price by using appropriate technology and providing timely service so

that a sustainable growth, reasonable return and contribution to the development of the country

can be ensured with a motivated and professional work-force.

Jamuna Bank Limited aims to become one of the leading Banks in Bangladesh by prudence, flair

and quality of operations in their banking sector. The bank has some mission to achieve the

organizational goals. Some of them are as follows as:

Fast & accurate customer service and Innovative banking at competitive price.

High quality financial services with the help of latest technology.

Deep commitment to the society and the growth of national economy.

Attract and retain quality human resource, High standard business ethics.

Balanced growth strategy, Steady return on shareholders’ equity

2.4.3 Motto:

The Bank will be a confluence of the following three interests:

Of the Bank : Profit Maximization and Sustained Growth.

Of the Customer : Maximum Benefit and Satisfaction.

Of the Society : Maximization of Welfare

16 | P a g e

2.5 Strategies of Jamuna Bank Ltd

To manage and operate the Bank in the most efficient manner to enhance financial

performance and to control cost of fund.

To strive for customer satisfaction through quality control and delivery of timely

services.

To identify customers' credit and other banking needs and monitor their perception

towards our performance in meeting those requirements.

To review and update policies, procedures and practices to enhance the ability to extend

better service to customers.

To train and develop all employees and provide them adequate resources so that

customers' needs can be reasonably addressed.

To promote organizational effectiveness by openly communicating company plans,

policies, practices and procedures to employees in a timely fashion.

To cultivate a working environment that fosters positive motivation for improved

performance

To diversify portfolio both in the retail and wholesale market

To increase direct contact with customers in order to cultivate a closer relationship

between the bank and its customers.

2.6 Objectives of Jamuna Bank Ltd

To earn and maintain CAMEL Rating 'Strong'

To establish relationship banking and improve service quality through development of

Strategic Marketing Plans.

To remain one of the best banks in Bangladesh in terms of profitability and asset quality.

To introduce fully automated systems through integration of information technology.

To ensure an adequate rate of return on investment.

To keep risk position at an acceptable range (including any off balance sheet risk).

To maintain adequate liquidity to meet maturing obligations and commitments.

To pursue an effective system of management by ensuring compliance to ethical norms,

transparency and accountability at all levels.

17 | P a g e

2.6 Offers of Jamuna Bank Ltd

Term loans especially to develop small scale enterprises and also attach special

importance to technical and advisory support in order to enabling them to run their

enterprises successfully.

Full-fledged commercial banking services including collection of deposit, shortterm trade

finance, working capital finance in processing and manufacturing units and financing and

facilitating international trade.

Technical support to Small Scale Industries (SSIs) in order to enable them to run their

enterprises successfully.

Micro Credit to the urban poor through linkage with NGOs with a view to facilitating

their access to the formal financial market for the mobilization of resources is another

diversification of our services.

In order to perform the above tasks, Jamuna Bank Ltd. works closely with its

Clients, the regulatory authorities, the shareholders (GOB), banks and other financial

institutions.

2.7 Corporate social responsibilities of Jamuna Bank

Jamuna Bank is the 3rd generation junior most bank. From the beginning, the bank is keen to

serve the society and welfare of the people as the corporate social responsibilities. To make

effective contribution by these CSR activities, the governing body of the bank established

Jamuna Bank Foundation in the year of 2007. The bank has appeared as a satisfactory bank to

the central bank. Jamuna Bank every year spends portion of its profit for backward people of the

country.

18 | P a g e

CSR activities of Jamuna Bank foundation are:

Anti-drug Movement

Blood Donation Program

Medical college & Hospital along with free Eye camp and Dental camp

Scholarship giving ceremony

Providing free Treatment

Qirat competition

Relief distribution for Disaster affected people

Discussion on Significance of Ramadan & Lifestyle of Prophets

Blanket & Cloth distribution among cold-hit distressed people

Sewing Training Center

Establishment of Free Primary School

Providing Computer Training by Jamuna Bank Foundation

Tree Plantation & Distribution

Annual School Sports Day & Award-giving Ceremony

Donating in Nimtoli Tragedy

Donating for Development of Sports for the country

Monthly Donating for BDR Tragedy

Donating in Liberation War Museum

19 | P a g e

20 | P a g e

3.1 JBL Personal Banking Services

Personal Banking services of Jamuna Bank offer wide-ranging products and services matching

the requirement of every customer. Transactional accounts, savings schemes or loan facilities

from Jamuna Bank Ltd. make available you a unique mixture of easy and consummate service

quality.

Products of Jamuna Bank Ltd. can be divided into two parts. They are

a) Deposit product

b) Loan products.

a) Deposits products are divided into three parts

1) Transactional Accounts

2) Fixed Deposit Receipts

3) Special Deposit Scheme

1) Transactional Accounts

i) Savings account

Bank considers it as Low cost liability product. The cost of Capital is Only Five percent. Savings

Bank Account may be opened in the name of adult individual who are mentally sound and also

jointly in the names of two or more persons payable to either or both or all of them or to the

survivor or survivors.

ii) Current Deposits

CD Stands for current Deposits. It is cost free. No interest given by the bank on this kind of

account. As it has no cost and more over bank charges on different services, the target of the

bank is to increase the number of current account clients. It can be opened by the name of any

organization and not in personal name. Current account is most suitable for private, traders,

merchants, exporters and importer. One can enjoy maximum flexibility and convenience he or

she opens a current account with JBL.

21 | P a g e

iii) Short Term Deposits.

This is also another low cost product. Anyone can open deposit like this one. Generally these

accounts are opened by Government, Companies or Administration persons. To get the interest

deposit need to keep for a minimum of seven days. Deposits under this category is withdraw

able at a minimum of 7 (seven) days notice.

iv) Special Savings Accounts:

JBL offer Special Savings Accounts to attract different type of segments in the competitive

markets. These are Grihini savings account, student savings account and senior Citizen Saving

Account, Which provide better interest rates and specialized services for particular groups.

v) Resident Foreign Currency Deposit (RFCD) Accounts

Persons ordinarily resident in Bangladesh may open and maintain RFCD accounts with foreign

exchange brought in at the time of their return from travel abroad. Any amount brought in with

declaration to Customs Authorities in form FMJ and up to US$5000 brought in without any

declaration. Balance in these accounts shall be freely transferable abroad. Fund from these

accounts may also be issued to account-holders for the purpose of their foreign travels in the

usual manner.

2) Fixed Deposit Receipts

Generally JBL offers Fixed Deposit for 3 months, 6 months and 12 months tenors at attractive

interest rates.

FDR for One month 8.00 %

FDR for Three month 10.00 – 10.75 %

FDR for Six month 10.00 – 10.75 %

FDR for Twelve months 10.00 – 10.50 %

22 | P a g e

However, one can have Fixed Deposit having a tenor more than 12 months under different

schemes like:

Double Growth Deposit Schemes (DGDS) and Triple Growth Deposit Schemes (TGDS) :

For people who have cash flow at this moment and want to get it doubled/tripled quickly JBL

has introduced Double/Triple Growth Deposit Scheme that offers to make double/triple money

within 5.7 years and 8.6(eight and a half) years respectively resulting a high rate of interest.

Monthly Benefit Scheme (MBS):

Jamuna Bank Limited’s Monthly Benefit Scheme (MBS) are for the prudent persons having

ready cash and desiring to have fixed income on monthly basis out of it without taking risk of

loss and without enchasing the principal amount. This scheme offers highest return with zero

risk. Everyone can plan monthly expenditure with the certain monthly income under the scheme.

Tenor Fixed Deposit Monthly Payable Amount

3 Years Tk.1 Lac Tk.1000.00

5 Years Tk.1 Lac Tk.1050.00

Pension Deposit Scheme: JBL Pension Deposit Scheme is designed for better future after retirement

Education Savings Scheme: Education is a basic need of every citizen. Every parent wants to

impart proper education to their children. Education is the pre-requisite for socio-economic

development of the country. As yet, there is no arrangement of free education to the citizens

from the government level. As such, there should be pre-arrangement of fund to ensure

higher education’s the children. Otherwise higher education may be hindered due to change

of economic condition, income of the parents at the future time when higher education shall

be required. Today's higher education is becoming expired day by day. Parents can get relief

and can have peace of mind if they can arrange the necessary fund for higher education of

their children. As such, JBI, has introduced 'Education Savings Scheme' which offers you an

23 | P a g e

opportunity to build up your cherished fund' by monthly deposit of small amount it at your

affordable capacity or initial lump sum deposit to yield handsome amount on a future date to

meet the educational expenses. Under this Scheme you have the different attractive options to

avail the future benefit i.e. withdrawal of the total amount accumulated in lump sum or

withdrawing monthly benefit to meet educational expense keeping die principal amount

intact or to withdraw both principal and accumulated profit monthly for a certain period.

3) Special Deposit Scheme

Monthly Savings Scheme (MSS): It’s good to save for rainy days and for prosperous

future. Savings can meet up any emergences. JBL has introduced Monthly Savings

Scheme (MSS) that allows saving on a monthly basis and getting a handsome return upon

maturity. If anyone wants to build up a significant savings to carry out you’re cherished

Dream, JBL MSS is the right solution.

Lakhpati Deposit Scheme: To become a lakhpati is a dream to most of the people of

Bangladesh especially to the lower and lower middle class income group. They

experience their expectations and wants are enormous in nature in our small span of life.

To meet our deposit and wants we need right plan. Keeping the above in mind JBL has

introduced "Lakhopati Scheme" which has flexibility report of maturity and monthly

installment as per affordable capacity.

Millionaire Deposit Scheme: JBL offer a deposit scheme which makes a customer

millionaire after certain time. It’s a dream for small savers to be a millionaire. This

dream can come to reality if saver has a calculated savings plan.

Kotipoti Deposit Scheme: To become ‘Kotipati' is simply a dream for the most of the

populace of Bangladesh. It is realizable for high income group who have strong

determination and savings habit. If you decide and plan to save money from your regular

income, you can own Tk1.00 crore easily by making a planned savings. In this regard,

JBL has introduced “Kotipati” Deposit Scheme” offering the savings plan fit to your

income and to execute your dream to be a Kotipati by monthly deposit at your affordable

24 | P a g e

capacity. You can take advantage of the “Kotipati Deposit Scheme” from JBL and plan

for your golden future accordingly.

Marriage Deposit Scheme: Marriage of children, especially daughter is a matter of great

concern to the parents. Marriage of children involves expense of considerable amount.

Prudent parents make effort for gradual building of fund as per their capacity to

meet the matrimonial expense of their children specially daughters. Parents get

relief and can have peace of mind if they can arrange the necessary fund for

marriage of their children, no matter whether they survive or not till the marriage

occasion. It can be a great help to the parents if there is any scope of deposit of a

modest mount as per their financial capacity, which groves very fast at high rate of

interest yielding a sizeable amount on maturity. With this end in view JBL has

introduced Marriage Deposit Scheme, which offers you an opportunity to build - up

your cherished - fund by monthly deposit of serial, amount at your affordable capacity.

b) Loan Products: Jamuna Bank designed different types of loan according to the need of customers.

Loan types Purpose Minimum Income Loan SizeMaximum Term of Loan

Auto Loan

To procure brand new/reconditioned Personal Transport, of age not more than 5 years. The Vehicle should have maximum 10(ten) seats. Model year is in the limit of 5 year.

Net Income should be at least Tk. 40,000/- per month

Minimum 5.00 Lac Maximum Tk. 20.00 Lac.

5 years

Any Purpose Loan

For construction & renovation of residential house/building and purchase of Flat/Apartment & any lawful purpose.



10 years.

Personal Loan

Any lawful purpose. Net Income should be at least Tk. 40,000/- per month


5 years

25 | P a g e

Salary LoanAny lawful purpose.


Minimum 1.00 lac Maximum Tk. 8.00 lac Or 12 times of gross salary, whichever is lower

5 year

Doctors Loan

Educational Expenses, Office Equipment, Medical Equipments Purchase, Professional Equipment Purchase, Commercial/Office/Chamber Space Purchase/, Renovation/Decoration, Office Decoration, Equipments, Electronics items purchase

Net Income should be at least Tk. 30,000/- per month.

Minimum 2.00 lac Maximum Tk. 50.00 lac.

5 year

Education Loan

Student supposed to bear (1) Tuition Fees (2) Living Cost (3) Other Educational Expenses (4) Consultants Fee (5) Visa Processing fees (6) Traveling Cost (7) Document/Other verification Fees (8) Purchase of Educational Equipments/Gadget (9) any other cost not stated above but acceptable to the bank.

Gross Monthly Income of the Customer/Guarantor should be at least Tk. 30,000/- per month.

Minimum 1.00 Lac Maximum Tk. 10.00 Lac

4 year

Overseas Job Loan

Travel expenses, marital expenses, Educational expenses, Festival expenses, Home construction, House renovation, Land purchase, Transport purchase, Office equipment, Professional equipment purchase, office space purchase, shop space purchase, Office decoration, Household durables/equipments/electronics purchase.

Net Income should be at least Tk. 50,000/- per month.

Minimum 2.00 Lac Maximum Tk. 50.00 Lac

5 year

26 | P a g e

3.1.1 Other services of Personal Banking Division

Personal Banking Division (PBD) issues both VISA Debit Cards and VISA Credit Cards.

VISA is the renowned Card brand in the earth. Jamuna Bank Limited is a principal member of

VISA Worldwide. Remittance Cell is another successful wing of the Personal Banking Division.

Product range includes:

VISA Debit Cards - You can now avail the convenience of VISA Debit Card. It is the easiest and

the most secured way of utilizing your money for 24/7 retail purchases as well as cash

withdrawal.

VISA Credit Cards - The JBL Credit Card gives you a fast, convenient and reliable way to pay,

24 hours a day, wherever you are in the world. VISA Classic, VISA Gold.

International Credit Cards – JBL International Credit Cards (VISA) allows you flexibility and

convenience when you travel internationally. The VISA International card entitles you to

exclusive discounts worldwide. VISA Dual (Gold)

JBL Remittance Cell – “Remit Fast” is the motto of JBL Remittance Cell. It provides the best &

faster services to its customers and connects the world through the renowned money exchange

agencies. Such as Placid Nk Corporation, Moneygram Payment System Inc., Raffles Exchange

Ltd.UK, Euro Bangla Money Transfer (UK) Ltd., Moneylink,UK, Homelink Remit (UK) Ltd.,

Rumana Money Services. Customers can avail improved pricing on remittance.

3.2 JBL Corporate Banking Services

Corporate Banking of Jamuna Bank Limited offers customized corporate banking solution for

both its local Business Houses as well as Multinational Companies. The axiom of JBL’s

Corporate Banking services is to nurture Relationship Banking by maintaining strong

relationship with premier corporate business houses of the country providing their requirement

based financial and other banking services. JBL’s Corporate Banking Division is well equipped

with skilled and experienced personnel who have vast exposure in this area and who being

Relationship Managers maintain one to one relationship with all corporate business houses

having relationship with the Bank. Relationship Managers are relentless in meeting the exact

need and any emergency requirement of the corporate customers.

27 | P a g e

JBL’s Corporate Banking exposure is concentrated in diversified areas of business that include:

Spinning

Textile

Garments

Garments Accessories

Iron & Steel

Cement

Building Materials

Furniture & Furniture materials

Edible Oil

Food & Beverage items

Various Trading

Ship Building

Ship Breaking

Infrastructure Building &

Construction

Electronics & Electrical Equipments

Agro & Agro Products

Transport

Real Estate

Telecommunication

28 | P a g e

3.3 Islami Banking Activities

Besides conventional banking, Jamuna Bank Limited is carrying Islami Banking activities based

on Islami Shaiah principles. The first Islami Banking branch of the Bank opened on October 25,

2003 at Nayabazar in Dhaka. Afterwards it’s second branch opened on November 27, 2004 at

Jubilee Road in Chittagong. Jamuna Bank Limited is committed to conduct business of it’s

Islami Banking branches strictly complying Shariah requirements. To achieve this goal a Shariah

Supervisory Committee has been constituted with renowned Islami scholars of the country and

senior banker having Islami Banking experiences in depth knowledge of conventional and Islami

Banking. All activities of Islami Banking branches are carried out under the guidance of this

Committee. A separate division has also been created at Head Office.

3.4 NRB Banking

Jamuna Bank Ltd is one of the fast growing private commercial bank in the country having wide

Branch & Associate network throughout the Country. All the branches are running with real-time

Online and ATM facilities to settle their transaction from remote areas. JBL have dedicated NRB

Banking Dept. to ensure personalized services to the valued customers at branch & Head Office

Level. JBL have an admirable Remittance Tie-up with a good number of world renowned

Exchange Houses and Banks throughout the World to facilitate the Remittance services to the

Beneficiaries. Besides JBL have 87+ Branch network and 1,800 ATM outlets (own & shared)

throughout the Country. JBL have also a strong Remittance Settlement/distribution Network with

different Associate Banks & BEFTN (Bangladesh Electronic Fund Transfer Network) covering

more than 8000 remote locations throughout the Country. To ensure JBL’s reach to the doorstep

of JBL’s valued customers / Beneficiaries JBL have arranged M-Remittance facilities with

Grameenphone, Banglalink, ROBI.

Main purpose is to cater to the needs of NRBs & their beneficiaries offering deposit and loan &

investment products and services. Prioritizing the needs of NRBs, JBL are in process to offer

different personalized products & services by establishing JBL own Exchange Houses in

29 | P a g e

different Countries like UK, USA, Malaysia, Singapore, Italy, Spain, Australia, Japan, etc. To

serve the NRBs in the best possible manner, Jamuna Bank Limited has deployed NRB

community consultants in Exchange Houses around the globe. They encourage potential

customers to use legal channels to remit their money to the loved ones as well as to invest their

savings in the productive sectors.

JBL have wide range of Correspondent Banking Network & Remittance drawing arrangement

with different International reputed Money Transfer Companies & Exchange Houses throughout

the world to facilitate Bangladesh bound Remittance Globally. JBL value JBL’s customers to

provide prompt & efficient services offering best competitive price for their hard-earning

Foreign Currencies.

3.5 SME Banking

SME means Small and Medium Enterprises. Small & Medium Enterprise (SME) plays a pivotal

role in the economic growth and development of a country. Actually, SME works as the platform

for job creation, income generation, and development of forward and backward industrial

linkages and fulfillment of local social needs. SMEs occupy a unique position in the economy of

Bangladesh. To keep these facts in mind JBL lunched several products for customers. These are:

1. Jamuna Bonik

SME clients are being involved in foreign trade, their network has been expanded throughout the

world. To facilitate the foreign trade transactions of the SME clients, Jamuna Bank is offering a

product named ‘Jamuna Bonik’.

2. Jamuna Chalantika

To operate business with extra ease, term loan is not always the only solution. Keeping this

capital requirement for your business, Jamuna Bank is offering a package of working capital

solution [50% term loan & 50% revolving credit (cash credit) facility] to run the business

smoothly.

30 | P a g e

3. Jamuna Green

To save our beloved earth from the disaster of Green House Effect, Jamuna Bank is offering

ECO friendly product ‘Jamuna Green’. Under this product, one can get finance for ETP plants in

different sectors, Eco friendly vehicles, Eco friendly fields (reduce CO2 emission), Bio

Fertilizer, Bio gas plants, Solar plants and Eco friendly any other business. Mode of finance shall

be Term Loan mainly.

4. Jamuna Jantrik

When any SME client wants to puchase any machine or vehicle for business, Jamuna Bank is

there with the offer of ‘Jamuna Jantrik’ thorugh which the client can get a lease finance facility.

5. Jamuna Nari Uddogh

About fifty percent of our total population is women and many of them have succeeded as a

business entrepreneur. To give incomparable ladies some extra ease and to help them to get

financial freedom, Jamuna Bank Ltd. is offering a product ‘Jamuna Nari Uddogh’.

6. Jamuna NGO Shohojogi

From the very beginning, one of the goals of Jamuna Bank Ltd. is to provide services to the

under privileged people of remote areas. Keeping that idea in mind, the Jamuna Bank Ltd. has

come forward with a product for SME customers named ‘Jamuna NGO Shohojogi’. ‘Jamuna

NGO Shohojogi’ ensures wholesale financing through the reputed NGOs in the country whose

past records are remarkable, repayment behaviors are satisfactory, growth rates are significant

and above all loan monitoring & recoveries are above 95%.

31 | P a g e

7. Jamuna Shachchondo

Who does not want a easy life? For the financial ease in business, Jamuna Bank is offering

‘Jamuna Shachchondo’ product through which one can enjoy both overdraft and term loan

facilities.

8. Jamuna Swabolombi

As an entrepreneur, definitely one needs working capital to run your business smoothly. To get

this working capital without Collateral Jamuna Bank Ltd. has ‘Jamuna Swabolombi’ – Collateral

free Term Loan in its basket. Just come with proper documents & get it.

3.6 International Banking

3.6.1 Corresponding Banking:

Jamuna bank is maintaining correspondent banking relationship with 234 international Bank

around 100 Countries in 818 different strategic locations worldwide to ensure the best &

steadfast trade services. Presently we have 23 Nostro Accounts in different Major Currencies like

USD, GBP, EURO, JPY, CHF, SAR, CAD & ACU Dollar with Various World reputed Bank.

As they have wider Correspondent Network with sustainable Credit limit & good relationship

globally, we can provide the following Services smoothly:

L/C Advising

L/C Confirmation

Bank Guarantee

Hajj Guarantee

Purchasing/Discounting/Negotiating of export bills

Off Shore Banking Services

Trade payment settlement

Cash Letter Services

Foreign Remittance

32 | P a g e

3.6.2 SWIFT services:

Jamuna Bank Limited is the member of SWIFT (Society for Worldwide Inter-bank Financial

Telecommunication). SWIFT is a member owned co-operative, which provides a fast and

accurate communication network for financial transactions such as Letters of Credit, Fund

transfer etc. By becoming a member of SWIFT, the bank has opened up possibilities for

uninterrupted connectivity with over 5,700 user institutions in 150 countries around the world.

3.6.3 Trade Finance:

International Trade forms the major business activity undertaken by Jamuna Bank Ltd. The Bank

with its worldwide correspondent network and close relationships with key financial institutions

provides an extensive trade services network to handle your transactions efficiently. Our key

branches throughout the country and Offshore Banking Unit (OBU) are staffed by personnel

experienced in International Trade Finance. These offices are the focal point for processing

import and Export transactions for both small and large corporate customers. We offer a

complete range of Trade Finance services. Our professionals will work with you to develop

solutions tailored to meet your requirements, through mobilizing our full range of trade services

locally, and drawing on our global resources. We can offer you professional advice on all aspects

of International Trade requirements, namely:

Issuing, advising and confirming of Documentary Credits.

Pre-shipment and post-shipment finance.

Negotiation and purchase of Export Bills.

Discounting of Bills of Exchange.

Collection of Bills.

Foreign Currency Dealing etc.

3.6.4 Offshore Banking:

An Offshore banking Unit (OBU) of a Bank is a deemed foreign branch of the parent bank

located within Bangladesh, and shall undertake International Banking business involving foreign

currency denominated assets & liabilities. An offshore bank is simply a bank based in a

33 | P a g e

jurisdiction outside of your country of residence. Accordingly, Jamuna Bank Limited has started

its OBU operation on 22nd April 2010 having following objectives:

To widen and diversify JBL’s area of services to the foreign investors as they do not have

the opportunity of availing credit facilities from different Financial Instittution in

Bangladedsh.

To diversify the sources of foreign exchange earnings by increasing export of Bangladesh

throgh the EPZs.

To encourage and foster establishment and development of industries and commercial

enterprises in EPZs in order to wider and strengthen the economic base of Bangladesh.

Jamuna Bank Limited offers the following range of Offshore Banking Services:

Foreign Currency Deposites( Non Resident entitles and NRBs)

Loan in Foreign Currencies

Credit Facilities including Trade Financing

Negotiation/Purchase of Export Bills

Discounting of Export Bills

Corporate Treasury Services.

Competitive interest rates

Easy international transfers

Fee free accounts

3.7 Online Banking

Jamuna Bank Limited has introduced real-time any branch banking on April 05, 2005. Now,

customers can withdraw and deposit money from any of its Branches. Their valued

customers can also enjoy 24 hours banking service through ATM card from any of Q-

cash ATMs located at Dhaka, Chittagong, Khulna, Sylhet and Bogra. All the existing

customers of Jamuna Bank Limited will enjoy this service by default.

34 | P a g e

3.8 Q-Cash Round The Clock Banking

Jamuna Bank Q-Cash ATIM Card enables the costumers to withdraw- cash variety of banking

transactions 24 hours a day. Q-Cash ATMs are conveniently located covering major

shopping centers, business and residential areas in Dhaka and chittagong. ATMs in Sylhet,

Khulna and other cities will soon start be introduced. The network will expand to cover the

whole country within a short span of time.

35 | P a g e

36 | P a g e

4.1 Introduction

All business concerns to earn a profit through selling either a product or service. A bank does not

produce any tangible product to sell but does offer a variety of financial services to its customers.

General banking is the starting point of all the banking operations. It is the development, which

provides day to day services to the customers. Every day it receives deposits from the customers

and meets their demand for cash by honoring cheques. It opens new accounts, remit funds, issue

bank drafts and pay orders etc. Since bank is confined to provide the service every day, general

banking is also known as “Retail Banking”. The JBL offers various types of general banking

components. They are very essential tools for the bank to serve the customers. To attract new

customers the bank has to launch new components or re-furnished their existing products.

4.2 Functions of General Banking

4.2.1 Account Opening Section

A Person is treated as a customer when he or she opens an account on that bank. Then it becomes a contractual banker customer relationship. The account opening section of any commercial bank is a very important section because; the more customers open bank account the more customers’ base creates. This section takes care of all the relevant duties related to the opening of an account. There are different types of account facilities provided by a commercial bank. For example, saving Account, Current Account, Fixed Deposit Receipt, Short Term Deposit Account, Cash Credit Account.

4.2.1.1 Procedure of Opening of an Account:

Banker’s his to maintain some common principles and procedures for open all most all deposit

accounts. Major information is essential for identification of the account holders individually so

that banker can discharge his obligations to everyone correctly and to the extent due. It is said

that, there is no banker customer relationship if there is no A/C of person in that bank. By

opening a banker and customer create a contractual relationship. However, selection of customer

for opening an account is very crucial of a bank.

37 | P a g e

The following instruction to be followed while opening account: -

Introduction of Account to be obtained from a respectable client acceptable to bank.

The introduction shall be obtained in writing in the respective column of Account opening

form.

For opening savings bank account of individual either singly or jointly, passports and identity

cards may be accepted for introduction, but subsequently proper introduction may be

obtained.

Introduction of Current Account by members of the staff may be allowed but shall be

discouraged as far as possible.

38 | P a g e

Applicant fills up the relevant application

form in the prescribed manner

She/he is required to fill up the specimen

signature card

For individual introduction is

needed by an account holder.

The authorized officer scrutinizes the introduction

and examines the documents submitted

Issuance of deposit slip and the deposit

must be made in cash

After depositing the cash one cheque

book & pay-in-slip book is issued

Account is opened

Current Account shall preferably be introduced by another Current Account holder

acceptable to bank.

Introduction of Account holder of other branch may be accepted with caution. In that case the

introducer’s signature must be verified by authorized officer of that branch and authenticated

by a forwarding letter.

Photographs of account holder must be attested by the introducer.

Letter of thanks be issued to introducer in Bank’s standard specimen.

4.2.1.2 Current Deposit Account

A Current Deposit Account may be opened by individual, firm, company and club,

association, body corporate etc.

Funds in the Current Deposit Account is payable on demand.

No interest is payable on balances of Current Deposit Accounts.

Current Deposit Account may be opened with a minimum initial balance of Tk.5,000/-

Minimum balance to be maintained in the account is Tk.1,000/-

Customer willing to open Current Deposit Account shall fill up the Account Opening

Form (AOF) applicable to him/ her and Specimen Signature Card (SS Card). The customer will

sign in the space provided under “Yours faithfully” and on the specimen signature cards.

In case of proprietorship and partnership firms the relevant account opening form is to be

filled in and signed by the proprietor/ partner in their individual capacity in the space provided

under “Yours faithfully” and on the specimen signature card in their official capacity.

In all other cases including companies etc. the persons opening the account shall fill in

the relevant Account Opening Form and sign the Form in the space provided under “Yours

faithfully” and in the specimen Signature Card in their official capacity.

Introduction of acceptable clients to be obtained as per guidelines.

The Manager’s approval for opening account shall be obtained by the concerned staff

member.

Signatures of the account holder shall be admitted by affixing the stamp “Signature

admitted” and signing by the authorized officer. The introducer’s signature shall be verified by

affixing the stamp “Signature verified” near the signature by authorized officer.

39 | P a g e

Blank space of the Specimen Signature Card should be closed by drawing parallel lines.

The particulars of the Account Opening Form shall be entered in the Account Opened

and Closed Register as per sequence provided by the computer system.

The customer shall be provided with Deposit Slip in corporating the Account Number

and be advised to make the initial deposit in the account. The amount of initial deposit shall be

entered in the Account Opening Form.

Cheque Book shall be issued on request on completion of all formalities including initial

deposit. Cheque series to be entered in the Account Opening Form at the bottom right and

authenticated by authorized officer.

After posting of all particulars of the account including cheque series, one authorized

officer shall check/ verify the same in the computer screen and record it in the form with

signature.

Manager/ Authorized Officer shall apply sufficient intelligence and common sense to

ascertain genuineness of the account holder. No account shall be opened without approval of

the Manager.

Clear instruction regarding operation of the account shall be noted on the Account

Opening Form and Specimen Signature Card especially in respect of death of inability of the

account holders, or the person operating the account. The account holder shall confirm the

instructions under specimen signature.

An indemnity shall be obtained from the customer if he/ she signs in language other than

English/ Bengali.

Illiterate persons shall be discouraged to open Current Account. If opened withdrawal

shall be allowed on personal appearance of the account holder.

The account opening form shall be sent to the respective computer terminal for posting

and S.S. Card shall be retained serially in the S.S. Card Box under custody of Cheque Passing

Officer.

One of the photographs of the Account Holder is to be pasted with AOF and another one

with S.S. Card. AOF to be retained in serial order in Pasting File.

A letter of thanks to be sent to the account holder as well as to the introducer.

All new accounts opened during the day shall be personally checked by the Manager at

the close of business of each day.

40 | P a g e

Checking officer shall particularly see the introduction, initial deposit in cash or cheque,

nature of business of the account holder, Trade License, Partnership Deed/ Memorandum of

Articles of Association, Resolution etc.

Similar Accounts should be noted in the AOF and care should be taken while making

posting of transactions in such accounts.

The Computer Program used by bank shall provide reference of clients. Branch Manager

must ensure that their computer system provides reference of client.

Classified Deposit Ownership Program to be maintained in the Computer System for

facilitating periodical returns to Bangladesh Bank.

Bank shall provide monthly statement of account to clients as per computer system of the

branch.

If minimum balance of the account falls below Tk.1,000/- once during the half-year,

incidental charge will be recovered as per Head Office Circular.

Bank at its discretion may close any account with prior notice to the account holder.

In case of closure of account by the account holder, branch shall recover closing charges

as per schedule of charges.

4.2.1.3 Bank Deposit Account

Savings Bank Account may be opened in the name of adult individual who are mentally

sound and also jointly in the names of two or more persons payable to either or both or all of

them or to the survivor or survivors.

Savings Bank Account may be opened in the name of a minor also.

Saving Bank Account may be opened in the names of clubs, societies, association and

similar institutions and even by government and semi-government offices.

Account shall be opened with at-least a minimum initial deposit of Tk.2,000/-.

Interest at the rates fixed by Head Office from time to time is applied half-yearly on the

balances held on daily product basis.

41 | P a g e

Not more than one account is allowed to be opened in the same name. But this will not be

applicable to parents willing to open more than one account in his/ her name in respect of each

minor child.

Savings Bank Account shall not be allowed to be overdrawn under any circumstances.

Account opening formalities like Current Account should be followed.

Savings Bank Account should not be allowed to be operated like Current Account

Not more than 25% of the balance can be withdrawn without 7 days notice. Withdrawals

in the account shall be allowed twice in a week.

No interest shall be paid to such accounts in the month for violation of the above rules.

Bank shall provide monthly-computerized statement of accounts to account holders

instead of passbook.

Bank may at its discretion close any account with prior notice for repeated return of

cheques due to insufficient balance.

Bank may recover charges up to a maximum of Tk.100/- per instances of cheque return.

4.2.1.4 Short Term Deposit Account (STD)

Deposits held in this account are payable on short notice. Normally corporate bodies, bank and financial organizations invest their funds temporarily. Now-a-days, private individuals having sound financial means also open this type of deposit accounts. The following rules shall apply:

Deposits held in STD Account are payable in 7 (Seven) days notice.

Cheque books may be issued to account holders for withdrawal of funds.

Repeated withdrawal without notice shall be discouraged.

Interest is payable on balance held on daily product basis as per computer program used by

bank.

For opening STD Account, AOF used for Current Deposit Account shall be used.

Other formalities are similar to Current Deposit Accounts.

Minimum balance requirement for accruing interest is Tk.100,000 (Taka one lac) only.

42 | P a g e

4.2.1.5 Fixed Deposit Account

Fixed Deposit is neither transferable nor negotiable.

Fixed Deposit Account may be opened by individuals, firms, companies, corporate body etc.

Fixed Deposit Account shall be opened for a fixed period ranging from 3 months to 36 months

or above as determined by Head Office from time to time.

Rate of interest payable to Fixed Deposit Accounts shall be approved/ advised by Head Office

from time to time.

Interest on deposits shall normally be payable on maturity along with principal.

Customers may however, have the option of withdrawing interest accrued after every six

months provided that the account is for more than 24 months period.

Interest ceases to accrue on overdue Fixed Deposit Account. Branch may, however, allow

interest to exceptionally valued clients on deserving cases with concurrence of Head Office.

FDR may be encased before maturity on written request of the depositor. For payment of

interest, branch shall follow Head Office instruction in this regard from time to time.

In case of FDR in joint names, written consent of all holders shall be obtained before

premature encashment, irrespective of instruction provided for operation of the account.

Duplicate FDR may be issued in case of loss of FDR reported by the holder. An indemnity

bond executed by the depositor(s) shall be obtained on Bank’s standard form. A remark

“DUPLICATE ISSUED IN LIEU OF ORIGINAL REPORTED LOST” is to be typed on top

of the duplicate FDR. The original number should be used and comments to this effect be

recorded in AOF, S.S. Card and FD Issue Register.

Extra care shall be taken in case duplicate FDR is proposed for lien to any bank.

Each FDR of the same depositor will be treated as separate contract.

Account Opening Form for Fixed Deposit Account contains relevant columns for mentioning

all terms including rate and term of deposit and operational instruction. The bottom part of the

form shall be used as credit voucher for the deposit. Specimen Signature Card duly signed by

the depositor to be obtained with clear instruction for operation of the account.

Nominee form may be obtained if the depositor desires to nominate any body to receive the

proceeds of his account in case of his death. Nominee’s Signature and one copy of photograph

duly attested by the depositor to be obtained.

43 | P a g e

The signature of the depositor is to be admitted by authorized officer both in AOF and S.S.

Card.

Particulars of the account shall be entered in the FD Account Opening Register and a control

number be allotted in computer sequence order with oblique against the printed number of

FDR. The complete number shall be quoted/ mentioned in all references.

On completion of all formalities, including deposit of fund, FDR shall be issued and signed by

two authorized officers. The FDR shall be delivered to depositor against acknowledgement on

the reverse of the counter foil.

The AOF will be retained in file and the S.S. Card shall be kept in S.S. Card Box under

custody of the concerned authorized officer.

The particulars of the account shall be posted in the computer system on completion of all

formalities including receipt of deposit. One authorized officer shall check/ verify the

particulars in the computer screen and record his comments on the AOF to this effect with

signature.

Renewal of Fixed Deposit Account shall be allowed on written request of the depositor, if no

intimation is received, the account shall be deemed to have renewed under the existing terms

and conditions automatically.

FDR can be accepted as security against credit facility.

Offer of special interest rate on deposits is subject to Head Office approval.

4.2.1.6 Documentation

The following documents duly completed shall be obtained from the customer at the time of

opening different types of accounts as applicable:

1. Individual/ joint.

Account opening form as applicable duly filled in.

Specimen Signature Card.

Two photographs duly attested by introducer.

Nominee Form (if nomination given by the account holder).

Mandate or Authority Form (if a third person is authorized to operate the account).

44 | P a g e

2. Proprietorship Firm

Account Opening Form.


Copy of Trade License

Two photographs duly attested by introducer.

Proprietorship Rubber Stamp against all signatures of the proprietor.

3. Partnership Concern



Copy of Trade License

Partnerships Deed

Two photographs of each partner duly attested by introducer.

Partnership Rubber Stamp against all signatures of partners operating the accounts.

Partnership letter.

4. Private Limited Company.



Copy of Trade License.

Copy of Memorandum and Articles of Association duly attested by the Managing

Director/ Chairman of the Co.

Certificate of Incorporation.

List of Director as per return of Joint Stock Company with signature.

Resolution of the Board for opening account with the bank.

Photographs of each of the authorized signatories.

45 | P a g e

5. Public Limited Company



Copy of Trade License.

Photograph of Directors and account operators other than Director.

Certified copy of Memorandum and Articles of Association.

Certificate of commencement of business.

List of Directors as per returns of Joint Stock Company with their signature.

Resolution of the Board for opening account with the Bank.

Certification of incorporation.

6. Clubs/ Association/ Society etc. (Non-Trading Concerns)

Account opening Form for current account or SB accounts.


Certified copy of Bye laws/ constitution of the organization.

List of the Executives of Managing Committee with their signature and present and

permanent address.

Resolution of the Committee for opening account with the bank.

2 Photographs of each operator of the account.

7. Corporation/ Autonomous Bodies/ Govt. Organization

Account Opening Form as applicable.


Copy of the Act or Ordinance Showing authority to open account.

Letter from the authorized persons in absence of the Board.

8. Account of Constituted Attorney

Account Opening Form (As applicable)

Specimen Signature Card

Power of Attorney

46 | P a g e

A copy of Power of Attorney shall be taken and entered in the Power of Attorney Register in

serial order. The serial number is to be noted along with Banks name on the Power of Attorney.

Original may be returned and the copy to be attached with Account Opening Form.

4.2.2 Issuing Cheque Book

A. Issue of fresh cheque book

Fresh cheque book is issued to the account holder only against requisition on the prescribed

requisition slip attached with the cheque book issued earlier, after proper verification of the

signature of the account holder personally or to his duly authorized representative against proper

acknowledgment.

47 | P a g e

Requisition slip filled properly along with

the cheque book number.

Banker Verifies the Slip

Banker issues new cheque book if every

thing in the right from.

Enter the new cheque book number in the

register book against the specific customer’s

name.

Procedure of issuance of a fresh cheque:

A customer who opened a new a/c initially deposits minimum required money in the account.

The account opening from is sent for issuance of a cheque book.

Respected officer first draws a cheque book

Officer than scaled it with branch name.

In-Charge officer enters the number of the cheque book in cheque issue register.

Officer also enters the customer’s name and the account number in the same register.

Account number is then writes down on the face of the cheque book and on every leaf of the

cheque book including requisition slip.

There is a special technique to sign every leaf of the cheque book with the help of carbon

paper. So officer’s signature prints the reverse side of the leaf.

The name of the customer is also written down on the face of the cheque book and on the

requisition slip.

The word “Issued on” along with the date of issuance is written down on the requisition.

Number of cheque book and date of issuance is also written on the application from.

Next, the customer is asked to sign in the cheque book issue register.

Then the respected officer signs on the face of the requisition slip put his initial in the

register and hand over the cheque to the customer.

B. Issue of New Cheque Book (For old Account)

All the procedure for issuing a new cheque book for old account is same as the procedure of new

account. Only difference is those customers have to submit the requisition slip of the old cheque

book with date, signature and his/her address. Computer posting is than give to the requisition

slip to know the position of account and to how many leaf/leaves still not used. The number of

new cheque book is entered on the back of the old requisition slip and is signed by the officer.

48 | P a g e

C. Procedure of issuance of a new cheque book:

If the cheque is handed over to any other person then the account holder the bank

addressing the account holder with details of cheque book issues an

acknowledgement slip. This acknowledgement slip must be signed by the account

holder and returned to the bank. Otherwise the bank will not honor any cheque from

this cheque book.

At the end of the day all the requisition slips and application forms are sent to the

computer section to give entry to these new cheque.

Then cutting the cheque book issuing) charge.

4.2.3Transfer of an Account

The account submits an application mentioning the name of the branch to which he

wants the account to be transferred.

His signature cards, advice of new account and all relevant documents are sent to

that branch through registered post.

The balance standing at credit in customer’s account is sent to the other branch

through Inter Branch Credit Advice (IBCA)

No exchange should be charged on such transfer.

Attention is also given in this connection.

4.2.4 Closing the Account

Upon the request of a customer, an account can be closed. After receiving an application from

the customer to close an account, the following procedure is followed by a banker. The customer

should be asked to draw the final cheque for the amount standing to the credit of his a/c less the

amount of closing and other incidental charges and surrender the unused cheque leaves. The a/c

should be debited for the account closing charges etc. and an authorized officer of the bank

should destroy unused cheque leaves.

49 | P a g e

In case of joint a/c, the application for closing the should be signed by all the joint holders.

A banker can also close the account of his customer or stop the operation of the account under

following considerable circumstances:

Death of Customer.

Customer’s insanity and insolvency.

Order of the court (Garnishee order)

Specific charge for fraud forgery.

4.2.5 Cash section

4.2.5.1Receipt and Payment of cash

Among the services provided by the bank, cash receipt and payment is the most vital and

physical function. Generally customer comes to bank to withdraw the money from their account

and deposit his savings in their accounts.

4.2.5.2 Cash Deposit

Money deposited in cash by the constituents at the cash counter of the bank excluding that of

government transaction is known as Bank Receipt (Cash). Different types of forms are used for

cash deposits for different types of accounts. Particulars of some forms are furnished below:

Current or Savings account pay in slip

Application for fixed deposit receipt

Credit voucher

Draft or mail transfer application form

T.T. Pay order application form Call deposit application form

Demand loan pays in slip.

50 | P a g e

4.2.5.3 Cash Payments

Banks payment includes all kinds of payments excluding those of treasury section. Extreme

precautions must be taken at all levels through, which instruments like cheque, drafts, etc, are

disposed of. All the instruments received at the general banking counter will be preliminary

checked by the dealing officer who will enter the instruments in the respective ledger. In case of

cheque the following particulars will be scrutinized.

Date (Whether post dated or anti dated)

Amount in word and figure

Crossed or Open

Bearer or Order

Style of signature as available in the ledger

Prohibitory order or stop payment of checks.

The Cash officer will follow the following procedures at the time of payments of checks/other

instruments over the cash counter.

1. The client will submit the instruments in the computer department first. The computer officer

and cheque passing authorized officer will verify the instrument and posted the instruments.

Then it will be send to the cash counter.

2. After getting the instrument the cash officer will verify the instruments and if necessary the

cash officer can tell the clients to sign in the backside of the instruments.

3. The officer will enter the check in the cash payments register where the denomination of

notes and coins will also be recorded.

4. The cash officer will give the amount to the clients at the cash counter and told the clients to

count it immediately and if needed any quarry.

5. All checks, drafts, debit vouchers etc. must be branded with “Cash Paid” stamp with the

current date.

6. After payment the cash department for the purpose of clean cash book will send the

vouchers.

7. The head of the cash department is responsible for all debit vouchers being branded with the

cash Paid date stamp immediately they are paid and the manager must supervise him/her in

this matter as any laxity is extremely dangerous.

51 | P a g e

4.2.6 Account Section

This is the most confidential department of a bank. Recording all kinds of transactions of the

branch, confirming their accuracy and preparing statements are the main job of this department.

Now a day under computerized banking system, the jobs of accounts department become very easy.

Now the computer directly prepares the clean cash statement on party ledger vouchers. The

function of the accounts department can be divided into two parts:

a) Daily function

b) Periodical functions

Daily functions:

The routine daily tasks of the accounts departments are as follows:

Record the daily transactions in the cash book.

Record the daily transactions in general and subsidiary ledger.

Prepare the daily position of the branch comprising of deposit and cash.

Prepare the daily statement of affairs showing all the assets and liability of the branch as

per ledger and subsidiary ledger separately.

Pay all expenditure on behalf of the branch.

Make salary statement and pay salary.

Checking whether all the vouchers are correctly passed to ensure the conformity with

the `Activity Report'; if otherwise making it correct by calling the respective official to

rectify the voucher.

Records inter branch fund transfer and providing accounting treatment in this regard.

Periodical Tasks:

The routine periodical tasked performed by the department are as follows:

Prepare the monthly salary statements for the employees.

Publish the basic data of the branch.

Prepare the weekly position for the branch, which is sent to the Head Office to maintain

Cash Reserve Requirement.

Prepare the monthly position for the branch, which is sent to the Head Office to maintain

52 | P a g e

Account SectionIBTA General Section

liquidity requirement.

Prepare the weekly position for the branch comprising of the breakup of sector wise deposit,

credit etc.

Preparing the budget for the branch by fixing the target regarding profit and deposit so as to

take necessary steps to generate and mobilize deposit.

JAMUNA bank instead of recording transactions in a journal initially, these are directly recorded

and posted in the ledger separating debit and credit by slip and voucher system. Records of all

the transactions of every department are kept here as well with other respective branch.

Inter-branch transaction

(IBTA) happens when one client of a branch places cheques or DD to his branch (which is not

branch which it is drawn) or if there comes TT or the branch sends TT, then there arises

arrangement of negotiation between the collecting branch and paying branch. The cheque will be

debited on the ledger book by particular amount of the cheque.

The information that is included on the IBTA register is as follows:

53 | P a g e

Credit Amount

Balance

Initial of the concerned officer

Remarks

Particulars

Advice No

Date

Debit Amount

General Section

Various types of vouchers come to this section from several departments (such as Deposit

Department, Remittance Department, Loans and Advances Department). At first, there happens

register entry then these goes for computer positing. One of the most important tasks that are

performed by this section is to inform the daily deposit position, bills payable and total loans &

advances to the Head Office. At the opening of the working day’s transaction this information

(previous working day’s) must be to the particular department of Head Office.

System of Accounting

The following ledgers are maintained and statements are prepared in the Accounts Departments-

i. Transfer Book

ii. Supplementary

iii. Clean Cash Book

iv. General Ledger

v. Subsidiary Ledger

a. Income Ledger

b. Expenditure Ledger

c. Sundry Asset Ledger

d. Sundry Deposit Ledger

e. Suspense A/C. Ledger

vi. Voucher Register

vii. Balance Book

viii. Daily Statement of Affairs

ix. Daily Position Statement

x. Weekly Position

xi. Provisional Income &

Expenditure Statement

xii. Accounts Monthly Statement

xiii. Salary Statement

xiv. Half-yearly Statement

xv. Annual Closing Balance

xvi. Statement of Reconciliation

Preparation of Supplementary Sheet: Instead of Day Book supplementary sheet is used after

transfer is completed, all the vouchers are sorted amount head wise. Credit vouchers under

specific head are grouped together; similarly all the debit vouchers are grouped. Separate

supplementary sheet for each group is made keeping the keeping the figures under the head of

Cash, Clearing and Transfer column. Then the sheet is totaled and the number of vouchers is

written on the supplementary sheet. Supplementary sheet should be recorded very carefully and

correctly otherwise accounts will not coincide with the cash received, cash payment, cash

transferred and clearing.

54 | P a g e

Transaction

Clearing Cash Transfer

Voucher

Recording in register

Posting in Ledger

Supplementary Sheet Preparation

Summary Preparation

Cash-cum Day Book

General Ledger Posting

Affairs Front Page

Subsidiary Accounts Posting

Affairs Back Page

Abstract

Balance

Tally with

Accounting workflow in branch

55 | P a g e

4.2.7 Local Remittance section

Due to the rapid expansion and complication of business world and increasing competition

business activities are now in broader scope. For this financial transaction also goes in boundless

arena. In this case Bank is the only concern, which helps the business world to complete these

complicated transactions.

Commercial banks in Bangladesh offer the facility of transferring funds, from one place to

another, to their customers as well as to the general public. Such transfer of funds can be affected

either through Demand Draft of Telegraphic Transfer or Mail Transfer. The aforesaid methods of

remitting money from one place to another within the country are known as Remittance. While,

it is for outside Bangladesh the same is called foreign remittance. The advantage of this facility

is the quick transfer of money with minimum cost and also the risk of physical transportation of

cost is criminated. Remittances are sent to one place from other places through D.D, P.O, and

T.T etc.

4.2.7.1 Demand Draft (DD)

Demand draft is a written order of one branch upon another branch of the same bank, to pay a

certain some of money to or to the order of a specified person. Drafts are not issued payable to

bearer. In practice drafts are not to be drawn between branches within the same city. Drafts

drawn by one branch of bank on another payable to order where any draft that is an order to pay

money drawn by one on a bank upon another office to the same bank for a sum of money

payable to order on demand, purports to be endorsed by or on behalf of the payee, the bank is

discharged by payment in due course. From the above provisions as to Crossing, Endorsement,

Collection and Payment in due course are the same as for checks:

4.2.7.2 Telegraphic Transfer (TT)

TT is affected by tile bank through tested message attested by secret check signal, on receipt of

which tile paying officer pay the amount to the payee in cash through a telegraphic payment

order or credit his account, as the case may be. Both parties must have account in Jamuna Bank

Limited, as money is transferred.

56 | P a g e

4.2.7.3 Payment Order (PO)

The PO is used for making a remittance to the local creditors. The procedures for selling a

PO are as follows:

Deposit money by the customer along with application form.

Give necessary entry in the Bills Payable register where Payee’ name, address, date, PO

no: amount is mentioned.

Prepared the instrument.

After scrutinized and approved the instrument by authority, it is delivered to customer.

Signature of customer is taken on the counterpart and register customer’s signature part.

Commission Charge

Amount in Taka Rate of Commission in Taka

Up to 10,000/- 15/= + 3.00

10,001/= to 1,00,000 25/= + 4.00

1,00,001/= to 5,00,000/- 40/= + 6.00

5,00,001/= To Above 50/= + 8.00

4.2.8 Clearing Section:

Clearing is one of the most magical parts of modern banking. Now days, the banking activities is

boundless. Most of the banks are linked with other banks due to interbank transactions. Clearing

is the only process by which these transactions are settled.

Clearing House is a centralized and computerized system for settling indebtedness between its

member banks. Clearing House enables the member banks to offset claims against one another

for checks and orders paid into banks other than those upon which they were drawn of the

clearing house, Bangladesh Bank, Dhaka.

Nature of clearing house

57 | P a g e

1st Clearing House

Outward Clearing

Return Clearing House

Inward Clearing

4.2.8.1 Types of Clearing:

There are two types clearing

I. Outward Clearing

II. Inward Clearing

Outward Clearing:

When a particular branch receives instructions drawn on the bank within the clearing zone and

sends those instructions for collection through the clearing arrangement is considered in outward

clearing for that particular branch. This branch is known as collecting branch.

Inward Clearing:

When a particular branch receives instructions, which are on themselves and sent by other

member banks for collection are treated as inward clearing of that branch.

Types of Returns: There are two types Returns

I. Outward Returns

II. Inward Clearing

Outward Returns:

Clearing returns (outward) include those cheques that were presented to us by other banks but

the bank has to return them unpaid to the collecting banks due to various reasons.

Outward Returns:

Clearing returns (inward) consists of those instruments which were presented by us to other

banks for payment but have been returned and unpaid by them due to specified reason through

the clearing house.

58 | P a g e

Cheques drawn on another branch of JBL. The settlement process:

Cheque drawn on another bank, which is situated within clearing house area.

4.2.9 Dispatch Section

Those documents that are enter in the branch or exit of the branch must go through this section.

The main objective of this section is;

Keeping record of the documents send to other branches or bank.

Letters are sending to their respective destination.

59 | P a g e

When IBCA comes customer’s account is credited

Depositor’s account is credited with JBL Sonargang Road Br

Send these documents safely and correctly.

Receives documents come through different medium, such as postal service, courier

service, via messenger etc.

Dispatch section of Shantinagar Branch performs another duty. It enters the transfer

instruments in the scroll book and then sends those to the computer section.

Two types of letters are continuously received. These are:

I. Inward (Registered/Unregistered) letter.

II. Outward (Registered/Unregistered) letter.

At first recording is required whether it is Inward or Outward Registered/Unregistered letters.

Then letters are disbursed to their respective destination. Inward letters are firstly segmented

according to their different sections and after that an entry is given to the Inward Register book.

Books Maintained

Local Dispatch Khata (including Peon Book)

Register Dispatch Khata (For Registered letter).

Ordinary Register Khata (For Unregistered letter).

Inward Register Books.

Outward Register Books.

60 | P a g e

61 | P a g e

5.1 Introduction

Commercial banks collect money from one group of people as deposits and distribute them

within the other group of customers as loans and advances and it is the most important function

of commercial bank. By this way the bank earns profit.

As a private commercial Bank JBL has some inherent commitment to the society. It provides

loans and advances to the customer, which can gear up the economy actively. Commercial and

Industrial loans to business concerns use to finance their day-to-day activities, to finance their

longer term needs and for other business purposes. The maturities of these loan 1 to10 years or

longer. JBL has been extending credit facilities to the potential, productive and sector as per

Bangladesh Bank instructions. Good loans are profit-earning asset to the Bank. A big portion of

opening income is generated from sound lending.

Bank cannot lend its fund fully. As per Banking Company Act 1991 every banking company has

to maintain a specified minimum (presently 16%) of the total of its demand and time liabilities in

form of cash and approved securities with Bangladesh Bank. So, Jamuna Bank Limited has to

carefully invest in loan/advances to get maximum performance from the investment.

5.2 Credit Facilities

The main focus of Jamuna Bank Ltd. Credit Line/Program is financing business, trade

and industrial activities through an effective delivery system.

Jamuna Bank Ltd. offers credit to almost all sectors of commercial activities having

productive purpose.

The loan portfolio of the Bank encompasses a wide range of credit programs.

Credit is also offered to major thrust sectors, as earmarked by the govt., at a reduced

interest rate to develop frontier industries.

Credit facilities are offered to individuals including housewives, businessmen, small and

big business houses, traders, manufactures, corporate bodies, etc.

Loan is provided to the rural people for agricultural production and other off-farm

activities.

Loan pricing system is customer friendly.

62 | P a g e

Prime customers enjoy prime rate in lending and other services.

Quick appreciation, appraisal, decision and disbursement are ensured.

Credit facilities are extended as per guidelines of Bangladesh Bank (Central Bank of

Bangladesh) and operational procedures of the Bank.

Type of Lending Interest Rate

Agriculture 13%Consumer Credit & Retail Portfolio 18%Credit to Non-Bank Financial Institution 16%Export Financing 7%Housing Loan 16.5%Lease Finance 17%Overdraft against FDR/ Scheme by JBL or other bank 15.5%SME 18%Term loan to Large & Medium Scale Industry 16%Term loan to Small Scale Industry 16%Trade/ Commercial Financing 16.5%Working Capital to Large & Medium Scale Industry 16.5%Working Capital to Small Scale Industry 16.5%

Interest Rates of Loans & Advances

5.3 Important Things in Lending

5.3.1 Documentation:

Documentation is a written statement of facts of proof or evidence arising out of particular transaction that on placement may bind the parties there to answerable & liable to the court of law for sanction of the charge in question. In this connection, bank for the purpose of security take some charge document from the borrower.

Common Compulsory Documents

A letter of acceptance about the terms & conditions laid down in sanction Promissory note (depending on the type of the borrower)

63 | P a g e

Letter of arrangement

5.3.2 Selection of a Borrower

Selection of a borrower is a vital step for lending. Due to the asymmetric information and moral

hazards, banks have to suffer a lot due to the classified loans and advances, which weakens the

financial soundness of the bank. If the selection of borrower is correct, as borrower’s character,

capital and capacity or of reliability, resourceful and, responsibility, the bank can easily get

return from the lending. Moreover, monitoring made easier for the banker. Jamuna Bank follows

the given procedures:

A. Borrower Analysis

Borrower Analysis is done from the angle of 3C (Character, Capital, Capacity) or 3R

(Reliability, Resourcefulness, Responsibility). The human skill, conceptual skill and operational

skill is qualitatively analyzed.

B. Business Analysis

Business Analysis is done from two angles, which are terms and conditions and collateral

securities.

C. Lending Authority

All approval of credit facilities must be conveyed under dual signature. Ideally both the

signatories must have the required lending authority .Two lending officer of the required lending

authority are not available, one of the signatory must have the lending authority. The Jamuna

Bank Limited Lending authority or authorized person or officers re as follows:

1. Managing Director

2. Deputy Managing Director

3. Executive Vice President

4. Senior Vice President

64 | P a g e

5. Senior Assistant Vice President

6. Vice President

7. Assistant Vice President

Irrespective of outstanding amount, the banks have to submit credit information of all of then-

account of loans and advances to the CIB of BB.

5.4 Credit risk management of JBL

5.4.1 Credit Rating Report of JBL

65 | P a g e

5.4.2 Preparation/Processing of Credit Proposals

Credit proposals shall be prepared in the approved format of the bank (Annexure- 1)

enclosing/furnishing documents/papers/information:

01. Pre-sanction Inspection Report containing DYC (Annexure-2).

02. Request for Credit limit of customers (Annexure-3).

03. Project Profile/profile of Business.

04. Copy of Trade license duly attested.

05. Copy of TIN Certificate.

06. Certified copy Memorandum and Articles of Association Certificate of Incorporation

Certificate of Commencement of Business Resolution of Board of Director Partnership Deed

(sheer applicable).

07. Personal Net worth Statement of the Owner /Director /Partner /Proprietor in Banks format

(Annexure-4).

08. Valuation Certificate in Banks format along with photograph of collateral security with detail

particulars on the back duly authenticated by the Branch Manager (Annexure-5).

09. Three years Balance Sheet and Profit and Loss A/C.

10. Credit Risk Grading for credit facilities irrespective of amount other than Consumer loan and

SME loan covered under consumer and SME guidelines.

11. Credit Report from other Banks.

12. Indent/Performa Invoice/Quotation (where applicable).

13. Price Verification Report (where applicable).

14. Statement of A/C (CD/SB/CC) for the last twelve (12) months. In case the customer

maintaining account with other Bank. Statement of Account for the last twelve (12) months

of the concerned Bank should be furnished.

15. In case of L/C proposal derailed performance of L/C during the last year i.e. No... and date of

L/C opened commodity L/C value Date of creation of PAD date of retirement mode of

retirement etc.

16. Justification/consideration for the facility.

66 | P a g e

Organizational Structure for Credit Operation

67 | P a g e

BOARD

EC

MD

DMD

Corporate

Division

General

Credit Dept

SME Dep

t.

Trade Finan

ce Dept

Leasing Dept

Syndication &

Structured Finan

ce dept

Internal Audit

Credit Division

CRM Dept

Recovery & Legal Dept

Credit Administr

ation Division

Branch wise Structure

5.4.3 Credit Risk Assessment

A thorough credit risk assessment should be conducted prior to the sanctioning of credit facilities. Thereafter it should be done annually for each relationship. The result of this assessment shall be presented in the credit proposal originated from the relationship manager (presently branch).

The Relationship Manager (Presently Head of Branch) should be the owner of the customer relationship and must ensure the accuracy of the entire credit proposal submitted for approval. Relationship Manager must be familiar with Bank’s Lending guidelines

And should conduct due diligence on the borrower, principals and Money Laundering Guideline be adhered to.

Follow risk areas in the credit proposal should be addressed and assessed before sending to head office.

1. Borrower Analysis:Share holdingReputationEducationExperience-success historyNet worthAge etc.

68 | P a g e

Head of Branch

Credit Marketing

Team

Credit Approval

Team

Credit Administration

Team

Credit Recovery

Team

2. Industry RiskIndustry position/ threat/prospect.Risk factors pertaining to the industry

Borrower’s position/ share in the industry.Strength, weakness of the borrower compared to the competitors etc.

3. Supplier Buyer risk Analysis

Concentration on single/ few buyer/ supplier are addressed. Demand supply position

4. Demand supply position

Concentration on single/ few buyer/ supplier are addressed. Demand supply position

5. Technical feasibilities/ infrastructural facilities6. Management teams competence7. Seasonality of demand8. Debt-equity ratio9. Historical financial analysis

An analysis of three years historical financial statements.Earning-its sustainabilityCash flowLeverageProfitabilityStrength and reliability of balance sheet etc.

10. Projected financialsSufficiency of cash flows to service debt repayment.Debt service coverage ratio

11. Trade checking12. Account conduct

For existing customer the repayment histories, credit turnover, study of account statement.

13. If the customer is proposed to be migrated from other bank, statement of account from present banker is required.

14. Allied deposit with the bank15. Other business with the bank16. Pricing-effective rate of return, return on investment.18. Security.19. Succession issue.

69 | P a g e

20. Margin, volatility of business, high debt( Leverage/ Gearing), over stocking, huge

receivables with long aging, rapid expansion, new business line, management change, lack of

transparency should be addressed. .

21. Environmental factor.

22. Employment generation and contribution to the national economy

5.4.4 Credit Monitoring

I. Computer generated list of exceptional advance to be obtained from the Branches on daily

basis which shall be examined at major exception be brought to the knowledge of Senior

Management.

II. Credit Administration Unit, Head Office shall bring the list of documentation shortfall/

deficiencies to the knowledge of Senior Management at regular basis and corrective

measure shall be taken.

III. Credit turnover in cash credit and overdraft accounts, past dues, collateral shortfall,

covenant Branch shall be reviewed on a regular basis.

IV. Recurring transactions are not allowed for one time transaction/limit.

V. Credit limit expiry date diary shall be maintained and followed-up.

VI. Use of Loan money shall be monitored through analysis of financial statement.

VII. Borrower shall be communicated ahead of time as and when installments are due.

VIII. Nonpayment and late payment of installment shall be communicated to the Senior

Management.

IX. CIB Report from Bangladesh Bank is obtained and reviewed on a periodic basis.

X. Timely renewal of limit shall be ensured information Branches two months ahead of expiry

dates.

70 | P a g e

5.4.5 Credit Risk Management Unit

The credit risk management unit shall perform interlayer the following duties

a) Assess risks inherent in the credit proposal sent by corporate division and also evaluate

proposed facility pricing based on risks, security, structuring and conditions to suit the

business condition and to protect bank’s interest.

b) Compliance to the existing rules and regulations of the bank and all regulatory authorities

and laws of the country and to advice the corporate division for rectification, if required.

c) Advice the corporate division about changes, if required, in the structure and terms and

conditions of the proposed facility.

d) Process credit proposal for approval of the competent authority.

e) Issues sanction advice for credit facilities or decline.

f) Maintain limit sanction register.

g) Handover loan to the credit monitoring and recovery unit as and when it is degraded to

Special monitor or bellow:

71 | P a g e

72 | P a g e

6.1 Introduction

International trade shapes our everyday lives and the world we live in. Nearly every time we make a purchase we are participating in the global economy. International trade is the system by which countries exchange goods and services. Countries trade with each other to obtain things that are better quality, less expensive or simply different from what is produced at home.

To buy foreign goods or services, or to invest in other countries, companies and individuals may need to first buy the currency of the country with which they are doing business. Generally, exporters prefer to be paid in their country’s currency or in U.S. dollars, which are accepted all to the world.

The procedures used to exchange currency in international trade are called foreign exchange system, banks plays vital roles in this procedures world widely. The Bangladeshi banks provide foreign exchange services under, Foreign Exchange Act, 1947 is for dealing in foreign exchange business, and Import and Export Control Act, and 1950 is for Documentary Credits. JBL has also become a member of SWIFT (Society For Worldwide Inter Bank Financial Telecommunication) in 2002, which provides a fast, secured & accurate communication network for financial transactions such as letter of credit, fund transfer etc. As an authorized dealer under regulations of BB, JBL provides the followings three type services under their foreign exchange department.

73 | P a g e

Foreign Exchange Depertment

Import Services

Remittance Services

Export Services

6.2 Foreign Currency Accounts offered by JBL

Following the liberalization of exchange controls Bangladesh Bank has authorized the banks to maintain different types of foreign currency accounts and convertible Taka accounts. The following are the regulations laid down by Bangladesh in respect of these accounts.

Branches of Jamuna Bank Limited may open Foreign Currency Accounts in the names of:

A. Bangladesh nationals residing abroad

B. Foreign nationals residing abroad or Bangladesh and foreign firms operating in Bangladesh or abroad,

C. Foreign missions and their expatriate employees.

This is a foreign currency denominated account. Those who domicile in Bangladesh, but have to remit money to abroad because of various reasons.

Non Resident Foreign Currency Deposit (NFCD):

This is a foreign currency denominated account. Those who doesn’t domicile in Bangladesh, but have to remit money to Bangladesh because of various reasons.

Requirements for opening RFCD Account:

Two copies of recent passport size photograph Photocopy of passport Photocopy of work permit Salary certificate or employers certificate

For the Officers of Different Embassy they need not to submit all these documents but the Employers certificate is must.

Requirements for opening NFCD Account:

Photocopy of passport Citizenship certificate if available Certificate or approval from our authority for exporting manpower A nominee or authorized person will be selected by the account holder for transactions. Under this account the nominee will receive local currency TK against any Foreign

Currency.

74 | P a g e

6.3 Import Section of JBL:

As an authorized dealer the major import items financed by Jamuna Bank Limited, are capital machinery, Hot Roll Steel, electronic equipment, rice, wheat, seeds, polyolefin, cement clinkers, dyes, chemicals, raw cotton, garments accessories, fabrics, cotton etc. To import, a person should be competent to be an ‘importer’. According to Import and Export (Control) Act, 1950, the officer of Chief Controller of Import and Export provides the registration (IRC) to the importer. After obtaining this, the person has to secure a letter of credit authorization (LCA) from Bangladesh Bank. And then a person becomes a qualified importer. He requests or instructs the opening bank to open an L/C.

6.3.1 Import procedures:

1. Registration with CCI & E

1. For engaging in international trade, every trader must be first registered with the Chief Controller or Import and Export.

2. By paying specified registration fees and submitting necessary papers to the CCI & E. the trader will get IRC (Import Registration Certificate). After obtaining IRC, the person is eligible to import.

2. Purchase Contract between importers and exporter:

1. Now the importer has to contact with the seller outside the country to obtain the Performa invoice/indent, which describes goods.

2. Indent is got through indenters a local agent of the sellers.3. After the importer accept the preformed invoice, he makes a purchase contract with the

exporter declaring the terms and conditions of the import.4. Import procedure differs with different means of payment. In most cases import payment

is made by the documentary letter of credit (L/C) in our country.

3. Collection of LCA form:

Then the importer collects and Letter of Credit Authorization (LCA) from JBL authorized Branches.

4. Opening a Letter of Credit (L/C)

Bank provides guarantee to importer and exporter through Letter of Credit. Thus the contract between importer and exporter is given a legal shape by the banker by its ‘Letter of Credit’. The process of opening L/C regarding to import through JBL, nominated branches are as following:

A. Interview of probable L/C opener:

At first in case of import L/C opening opener must give an oral interview to the responsible officers of JBL. If the officer is satisfied with opener’s motive of import, type of import goods,

75 | P a g e

quality of imported goods and marketability of goods than they will give approval to opener to further steps.

B. Application for L/C limit:

Before opening L/C, importer applies for L/C limit. To have an import L/C limit, an importer submits an application to the Department of JBL furnishing the following information,-

1. Nature of business.2. Required amount of limit.3. Payment terms and conditions.4. Goods to be imported.5. Offered security.6. Repayment schedule.7. Full particulars of bank account maintained with JBL Authorized Branches.

C. The L/C Application:

After getting the importer applies to the bank to open a letter of credit on behalf of him with required papers. Documentary Credit Application Form:

Tax Identification Number Certificate. VAT Registration Certificate. Membership Certificate of recognized Trade Association as per IPO. Performa Invoice: It states description of the goods including quantity, unit price etc. L/C Form: JBL provides a printed form for opening of L/C (JF-fx 13) to the importer.

This form is known as Credit Application form. A special adhesive stamp is affixed on the form. While opening, the stamp is cancelled. Usually the importer expresses his desire to open the L/C quoting the amount of margin in percentage.

L/C authorization form (LCAF) duly signed by the importer. The insurance cover note: The name of issuing company and the insurance number are to

be mentioned on it. IMP form duly signed by the importer. Forwarding for Pre-Shipment Inspection (PSI): Importer sends forwarding letter to

exporter for Pre-Shipment Inspection. But all types of goods do not require PSI.

5. Time limit for opening L/C:

L/C (s) shall be open within 180 days from the date of issuance of LCAF or from the date of registration of LCAF with Bangladesh Bank.

76 | P a g e

6. Terms of L/C:

Full description of the goods along with quantity and unit price to be incorporated in the L/C and shall take all precautions to quote the correct H.S. Codes of the goods. Prices to be quoted on CER or FOB basis according to the P/Invoice or Indent. No import shall be made on CIF basis without prior approval from the Ministry of Commerce.

All L/Cs should provide for payment to be made against full sets of on board (shipped) transport documents drawn and/or endorsed to cover by the credit to a destination in Bangladesh.

All L/Cs must specify submission of signed invoices, certificates of origin & pre-shipment Inspection Certificate. L/Cs shall also incorporate any other documents, which are mandatory specified for those commodities in the IPO/Public Notices/Bangladesh Bank Circulars.

It is not permissible to open import L/Cs in favor of beneficiaries or to use shipping carriers of the countries from which import into Bangladesh are banned by the competent authority.

7. Shipment Validity & Expiry:

All L/Cs must specify shipment validity as per terms of the P/Invoice or indent or L/C application. However, shipment validity under any circumstances shall not exceed 9 (nine) months from the date of issuance of LCAF or registration LCAF with Bangladesh Bank excepting capital machinery and spare parts shipments of which shall be made within 17 (seventeen) months. All L/Cs must stipulate an expiry date and a place for presentation of documents for payment/acceptance.

8. Transmission of L/C to Beneficiary through Advising Bank:

In this step the transmission of L/C is done through tested telex or fax to advise the L/C by JBL to the advising bank. The advising bank verifies the authenticity of the L/C. JBL has corresponding relationship or arrangement throughout the world by which the L/C is advised. Actually the advising bank does not take and liability if otherwise not requested.

9. Presentation of the Documents:

The seller being satisfied with the terms and the conditions of the credit makes shipment o the goods as per L/C terms.

After making the shipment of the goods in favor of the importer the exporter submits the documents to the negotiating bank.

After receiving all the documents, the negotiating bank then checks the documents against the credit. If the documents are found in order, the bank will pay, accept or negotiate to JBL.

JBL, Authorized Branches & bank received seal to be affixed on the forwarding schedule.

JBL, Authorized Branches crossed the bill of exchange & transport documents immediately to protects loss or fraudulent.

77 | P a g e

JBL checks the documents. The usual documents are,

Bill of exchange. Invoice. Bill of lading or Airway bills Certificate of origin. Packing list. Weight list. Shipping advice. Non-negotiable copy of bill of lading. Pre-shipment inspection report. Shipment certificate.

10. Lodgment of Documents:

If the documents are found in order or the discrepancies in the document if any, are subsequently accepted by the applicant, the branch will record the particulars of the documents in the PAD Register (JB fx-06).

11. Retirement of Documents:

JBL advise Importer about the date of lodgment of documents with full particulars of shipment to retire the documents against payment or to dispose the import documents as per prearrangement, if any. Subsequent reminders (JF fx-06) are also to be issued every week till retirement of the bill. Such bills will be considered and be reported as overdue if the importer fails to retire the documents within 21 days of arrival of the relative import consignments at the port of destination.

12. Endorsement of Non-Negotiable Copy Documents:

For clearance of cargo:

In the event of non-receipt of import documents relating to goods, which have already reached the port, the customer may ask the bank to provide a Shipping Guarantee/NOC to enable them to clear the goods, form the customers. The Shipping Guarantee may be given on the basis of a written undertaking from the clients by JBL. The S/G should state, inter alias, that he will in due course accept the original documents in spite of discrepancies, if any and bear the exchange loss on account of fluctuation of exchange rates between the dates of guarantee to actual date of lodgment of original documents, when received.

JBL, Authorized Branch will check the non-negotiable copy documents with the L/C terms and make entries of particulars of copy documents in the Shipping Guarantee Issue Register (MB fx-06)

JBL, Authorized Branch will recover Taka equivalent of F.C value of N/N copy documents and charges from the customer.

78 | P a g e

JBL, Authorized Branch will ensure return back of the shipping indemnity/guarantee from the shipping company by delivering original shipping documents to the importer after receipt of original documents from the payee bank.

JBL, Authorized Branch will mark cancellation on the shipping indemnity/guarantee returned by the shipping company through the importer and file it in the respective L/C file.

For customer Assessment Purpose:

At the request of the importer, JBL, Authorized branch may endorse Non-negotiable copy documents for custom assessment purpose. The branch will certify the value of F.C on the copy invoice and also certify the copy transport documents under single authorized signature. Endorsement charge is to be realized as per schedule of charges of the bank.

13. Amendments:

The JBL, Authorized Branch may allow amendments to the L/Cs only upon requests of the L/C applicants that do not violate foreign exchange regulations and import control regulations. Necessary charges and/or margin (where L/C value is increased by subsequent amendments) also to be realized/recovered from the customer before amending the L/Cs.

14. Cancellation of L/Cs:

An irrevocable L/C cannot be cancelled without the agreement of the beneficiary and the confirming bank, if any.

The JBL, Authorized branch at the request of the importer may approach the L/C advising bank for cancellation of the L/C and such cancellation will only be effective upon consent of the beneficiary advised to the branch through the L/C advising bank. However, the JBL, Authorized branch may cancel the L/C without the consent of the beneficiary. Advising bank and confirming bank, if any, if the L/C expires and the JBL, Authorized branch receives no shipping documents within 15 days of expiry of the L/C. The branch should send a message to the concerned bank advising such cancellation and closure of L/C file due to expiry of the same. The JBL then cancels the Reimbursement Authorization, which has been provided to the Reimbursement Bank while opening the L/C. The branch will reverse L/C contra liabilities, refund margin and recover charges from the L/C applicant as per schedule of charges.

79 | P a g e

6.3.2 Import Financing by JBL:

Payment against Document (PAD):

The JBL, Authorized branch starts PAD procedure after getting all documents from the exporter of importer as evidence of exporting goods. Documents required for PAD is mentioned below:

Original (Non-negotiable) bill of Leading. Commercial Invoice. Certificate of Insurance. Certificate of Origin. Bill of exchange. Pre-shipment Inspection Certificate. Packing List. Clean Report of Findings (CRF).

Loan against Trust Receipt (LTR):

Under this LTR, Loan is allowed by JBL only to first class importers. Here only on the basis of trust without paying JBL anything or a partial amount, the importer takes the documents. Then importer is allowed 60-90 days time to make payment.

Loan against Imported Merchandise (LIM):

The imported goods come to the port the party may fall into financial crisis and requests JBL to clear the goods from the port making payment to the exporter. In this case the party later may take the goods partly or fully from JBL by making required payment (if he/she takes the goods time-to-time payment will be adjusted simultaneously).

80 | P a g e

6.4 Export section of JBL

6.4.1 Export Procedures:

The import and export trade in our country are regulated by the Import and Export (Control) Act, 1950.Under the export policy of Bangladesh the exporter has to get valid Export registration Certificate (ERC) from Chief Controller of Import & Export (CCI&E). The ERC is required to renew every year. The ERC number is to incorporate on EXP forms and other papers connected with exports. JBL mainly handles export of readymade garments, jute goods, leather, plastic scrap, handicrafts etc. The followings process must be passed by an exporter to open a documentary credit in JBL, Authorized branch:

(a) Registration of Exporters: For obtaining ERC, intending Bangladeshi exporters are required to apply to the controller/ Joint Controller/ Deputy Controller/ Assistant Controller of Imports and Exports, Dhaka/ Chittagong/ Rajshahi/ Mymensingh/ Sylhet/ Comilla/ Barishal/ Bogra/ Rangpur/ Dinajpur in the prescribed form along with the following documents:

Nationality and Assets Certificate;

Memorandum and Article of Association and Certificate of Incorporation in case of Limited Company;

Bank Certificate;

Income Tax Certificate;

Trade License etc.

(b) Securing the Order: After getting ERC Certificate the exporter may proceed to secure the export order. He can do this by contacting the buyers directly or through agent. In this purpose the exporter may get help from:

License Officer;

Buyer’s Local Agent;

Export Promoting Organization;

Bangladesh Mission Abroad;

Chamber of Commerce (local & foreign)

Trade Fair etc.

81 | P a g e

(c) Signing the Contract: After communicating buyer, exporter has to get contracted (writing or oral) for exporting exportable items from Bangladesh detailing commodity, quantity, price, shipment, insurance and marks, inspection and arbitration etc.

(d) Receiving Letter of Credit: After getting contract for sale, exporter should ask the buyer for Letter of Credit (L/C) clearly stating terms and conditions of export and payment.

The following are the main points to be looked into for receiving/ collecting export proceeds by means of Documentary Credit:

The terms of the L/C are in conformity with those of the contract;

The L/C is an irrevocable one, preferably confirmed by the advising bank;

The L/C allows sufficient time for shipment and negotiation.

(Here the regulatory framework is UCPDC-500, ICC publication)

Terms and conditions should be stated in the contract clearly in case of other mode of payment:

Cash in advance; Open account; Collection basis (Documentary/ Clean)

(Here the regulatory framework is URC-525, ICC publication)

(e) Procuring the materials:

After making the deal and on having the L/C opened in his favor, the next step for the exporter is to set about the task of procuring or manufacturing the contracted merchandise.

(f) Shipment of goods:

Then the exporter should take the preparation for export arrangement for delivery of goods as per L/C and incomer’s, prepare and submit shipping documents for Payment/ Acceptance/ Negotiation in due time.

Documents for shipment:

EXP form, ERC (valid), L/C copy, Customer Duty Certificate, Shipping Instruction, Transport Documents, Insurance Documents,

82 | P a g e

Invoice, Other Documents, Bills of Exchange (if required) Certificate of Origin, Inspection Certificate, Quality Control Certificate, G.S.P. Certificate,

(g) Documents submission:

In this step exporter who confined with JBL will prepare export related documents and submit those documents to JBL, foreign exchange authorized branch for negotiation. According to those documents JBL collects proceeds from the former issuing banks.

6.4.2 Export Financing by JBL:

Financing exports constitutes an important part of a bank’s activities. Exporters require financial services at four different stages of their export operation. During each of these phases exporters need JBL provides different types of financial assistance depending on the nature of the export contract are as follows:

Pre-shipment credit Post-shipment credit

Pre-shipment credit:

Pre-shipment credit, as the name suggests, is given to finance the activities of an exporter prior to the actual shipment of the goods for export. JBL provides different type of Pre-shipment credit to its worthy customers for the following purposes:

Cost of production or purchase

Packing including any special packing for export

Cost of special inspection or tests required by the exporter

Internal transport cost

Port, customs and shipping agent’s costs

Freight and insurance charges if the contract is either C&F contract or a CIF contract and

Export duty or tax etc

83 | P a g e

For Pre-shipment finance JBL, Authorized foreign exchange branch must consider the following factors related to exporters such as:

Honesty, integrity and capital of the borrower Exporter experience in the line Security offered The margin and the rate of interest The banks previous experience about the exporter The standing of the foreign buyer

JBL provides facilities to extend Pre-shipment credit for contracts made on the basis of cables/fax/telex provided the following minimum information is available:

Details regarding customers Particulars of the items Quantity and unit price Terms of sales and payment and Date of shipment

An exporter can obtain credit facilities against lien on the irrevocable, confirmed and unrestricted export letter of credit in form of the followings from JBL, but PC and BTB L/C is most common form of pre shipment of credit provided by JBL:

a) Export cash credit (Hypothecation)

b) Export cash credit (Pledge)

c) Export cash credit against trust receipt.

d) Packing credit.

e) Back to back letter of credit.

Post Shipment Credit:

This type of credit refers to the credit facilities extended to the exporters by the banks after shipment of the goods against export documents. Before extending such credit, it is necessary for JBL to look into carefully the financial soundness of exporters and buyers as well as other relevant documents connected with the export in accordance with the rules and regulations in force. JBL provides following post shipment credit to the exporters through:

a. Foreign Documentary Bill Purchase (FDBP):

b. Advances against Export Bills surrendered for collection;

84 | P a g e

(a) Foreign Documentary Bill Purchase (FDBP):

Most of the client submits the bill of export to bank for collection and payment of the BTB L/C.

In that case, JBL purchases the bill and collects the money from the exporter. JBL subtracts the

amount of bill for PC and BTB payment and gives the rest amount to the client in cash or by

crediting his account or by the pay order.

For this purpose, JBL maintains a separate register named FDBP Register. This register contains

the following information:

Date

Reference number (FDBP)

Name of the drawee

Name of the collecting bank

Conversion rate

Bill amount both in figure & in Taka.

Export form number

Export L/C number

(b) Advances against Export Bills surrendered for collection:

JBL also accept bills for collection of proceeds when they are not drawn under an L/C or when

the documents, even though drawn against an L/C contain some discrepancies. JBL generally

negotiates bills drawn under L/C, without any discrepancy in the documents, and the exporter

gets the money from the bank immediately. However, if the bill is not eligible for negotiation,

the exporter may obtain advance from JBL against the security of export bill. In addition to the

export bill JBL generally ask for collateral security like a guarantee by a third party and

equitable/registered mortgage of property.

85 | P a g e

6.5 Foreign remittance:

Foreign remittance means remittance of foreign currencies from one place/persons to another place/person. In broad sense, foreign remittance includes all sale and purchase of foreign currencies on account of Import, Export, Travel and other purposes. However, specifically foreign remittance means sale & purchase of foreign currencies for the purposes other than export and import. As such, this chapter will not cover purchase & sale of foreign currencies on account of Import & Export of goods.

On March 24, 1994 Bangladesh Taka was declared convertible for Current account International Transaction. As a prelude to this wide-ranging reforms were made in the country’s foreign exchange regime to lay the ground for a market friendly environment to induce investment, growth and productivity. Following liberalization under convertibility, most remittances are now approved by the Authorized Dealers themselves on behalf of the Central Bank. Only a few remittances of special nature require Bangladesh Bank’s prior approval.

6.5.1 Foreign Remittance Section of JBL:

Foreign exchange department of JBL, foreign exchange authorized branch are responsible to deal with outward and inward remittance other export and import only when remittance are in foreign currency. JBL has already made foreign remittance arrangement with money grume,

Workings of this department:

Overall supervision of Foreign Remit. Dept. Foreign TT payments & Purchase of F. Drafts, preparations of F.B.P. (Foreign Bill

Purchased). Issuance of outward TT & FDD. Issuance of proceed responding certificate (PRC). Foreign Collection, Bangladesh Bank Clearing Check Collection, which comes from all

branch of JBL. Withdrawal from F.C. A/C. Encashment of T.C. & Cash Dollar and Sterling Pound. Deduction of Tax and VAT. On behalf of Bangladesh Bank. Preparation of related statements including convertible Taka Accounts. Preparation of IBCA & IBDA and Balancing of Collection and other special assignment

as desired by Department in charge. Balancing of Account Statements. Compliance of audit & inspection. Statement of all related works submitted to Bangladesh Bank.

All foreign remittance transactions are grouped into two broad categories of remittance i.e. Outward remittance & Inward remittance. As an AD MBL foreign exchange department focuses on these two sources of remittance.

86 | P a g e

6.5.2 Outward Remittance of JBL:

The term “Outward remittances” include not only remittance i.e. sale of foreign currency by TT.

MT, Drafts, Traveler’s cheque but also includes payment against imports into Bangladesh &

Local currency credited to Non-resident Taka Accounts of Foreign Banks or Convertible Taka

Account. The main three type of outward remittance find JBL are as follows:

1. Private Remittance

2. Fiscal & Business Travel

3. Commercial Remittances

6.5.3 Inward remittance of JBL:

The term” Inward Remittance” includes not only purchase of Foreign Currency by TT, MT,

Drafts etc. but also purchases of bills, purchases of Traveler’s cheques. The main two sources of

inward remittance are proceeds realized from export process and also a strong source

Bangladeshi workers remittance from abroad.

87 | P a g e

88 | P a g e

7.1Analysis of financial JBL performance

Year 2008 2009 2010 2011 2012Up to Sep-

2013

Net Profit 476.43 923.12 1066.02 1330.19 1042.05 246.07

Total Paid Up

Capital1313.27 1621.88 2230.09 3648.4 4487.54 4487.54

Total Share

Holders’ Equity

2160.73 3980.88 6408.19 7281.51 8324.83 8324.83

Total Asset

31646.63 48730.95 70013.9 87065.13 109678.51 109678.51

TotalInvestmen

t4238.63 8503.44 10891.02 16314.93 39118.93 39118.93

Total Deposits

27307.94 42356.2 60673.56 70508.05 79623.13 79623.13

Loan and Advances

21036.86 32287.66 49734.8 56611.79 54887.03 54887.03

Export 18617 21407 41860.4 57929.4 68844.1 68844.1

Import 30311.71 46685 61034.5 55907 57705.2 57705.2

89 | P a g e

7.1.1 Net Profit:

Up to September 2013 the net profit of JBL was 246.07. In 2012 Jamuna Bank Limited posted a Net profit of Tk.1042.05 million and in 2011 they reached at the peak by achieving net profit of 1330.19. In 2010 the Net profit was 1066.02 which was better than 2013’s, in 2008 company just

managed to earn 476.43 million taka but they turn back pretty well to post 923.12 million

7.1.2 Paid Up Capital:

Jamuna Bank Limited has a conviction of maintaining a strong capital base. In the graph can see that paid up capital increased every year. In 2008 the paid up capital was 1212.27 million and in 2012 in increased to an amount of 4487.54 million so in 4 years the paid up capital increased 241.66%

90 | P a g e

2008 2009 2010 2011 2012 415180

200

400

600

800

1000

1200

1400

476.429999999999

923.121066.02

1330.19

1042.05

246.07

Net Profit

Net Profit

20082009

20102011

201241518

0500

10001500200025003000350040004500

1313.27 1621.882230.09

3648.44487.54 4487.54

Paid Up Capital

7.1.3 Total Share holders’ Equity:

In 2008 total share Holders’ equity was 2160.73 Million in 2009 in increased 83.24% to reach the amount of 3980.88. In 2010 share Holders’ equity reached to 6408.19 and 2011 it was 7281.51. Finally in 2012 Total share Holders’ equity was 8324.23, Up to September 2013 equity of share holders was 7995 million

7.1.4T

otal Assets:

According to the Balance sheet in 2008 JBL’s total asset was only 31646.63 million but total assets increased every year which is good news for them. In 2009 total asset amounted 48730.95, in 2010 total assets increased to 70013.9 million. In 2011 their Total asset was 87065.13 million

91 | P a g e

2008 2009 2010 2011 2012 41895

Total Share Holders' Eq-uity

2160.73 3980.88 6408.19 7281.51 8324.83 7995

500

1500

2500

3500

4500

5500

6500

7500

8500

Total Share holders Equity

which increased to 109678.51 in 2012. According to unaudited Balance sheet up to September 2013 it is reported that total asset is 115443.83 million

7.1.5

Investments

In the graph we can see an upward direction of the curve which means the investment of JBL increased each year. In 2008 it was 4238.63 Million then it increased to 10981 in 2009. By the year 2010 total investment reached at 10891.02 million. In 2011 it was 16314.93 but there was huge increase in investment in 2012 the growth rate is almost 140%, as of September 2013 investment reached to the spot of 34111.83 million.

92 | P a g e

2008 2009 2010 2011 2012 418950

20000

40000

60000

80000

100000

120000

140000

31646.6299999999

48730.95

70013.9

87065.13

109678.51115443.83

Total Assets

Total Asset

7.1.6 Deposit and Deposit Mix

93 | P a g e

2008 2009 2010 2011 2012 418950

5000

10000

15000

20000

25000

30000

35000

40000

45000

4238.63

8503.44

10891.02

16314.93

39118.93

34111.83

Investment

Investment

In commercial banks operation starts with mobilization of resources i.e. tapping of deposits and then they said resources are deployed as loans, advances and investments for the purpose of maximizing wealth in which deposits have dominance in commercial bank's operations. That is why; there is a common saying that deposit is the lifeblood of a bank. In keeping with this axiom JBL attaches utmost importance to the deposit mobilization campaign and to the optimal deposit mix for minimizing COF as far as practicable. A stiff competition persisted in the market as to deposit mobilization and there was a pressure on interest rate. Besides, instability in political atmosphere was adversely affecting business, which stood as a hindrance to the smooth operation of banks including deposit mobilization. Despite all these unfavorable factors JBL was able to instill confidence in customers as to its commitments to the depositors and borrowing customers. In 2008 total Deposit of JBL was 27307.94 million in 2009 in increased the amount of 42356.2. In 2010 total Deposit was 60673.56 and 2011 it was 70508.05. Finally in 2012 Total Deposit was 79623.13, in 2013 deposits reported 96308.67 million.

Types of Deposit As on

31.12.2012

As on

31.12.2011

Changes

(+/-)

Changes in &

over the year

Current A/C & other 8738.37 7871.32 867.05 11.02

Bills Payable 1211.96 989.43 222.53 22.49

Savings Deposit 5046.42 4473.70 572.72 12.80

Fixed Deposit 44680.76 42857.04 1823.72 4.26

94 | P a g e

20082009

20102011

201241895

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

100000

27307.94

42356.2

60673.5670508.05

79623.13

96308.67

Deposits

Deposits

Short term Deposit 3832.90 2638.96 1193.94 45.24

Deposits under Special

Scheme

15915.01 11506 4408 38.31

Foreign Currency Deposit 197.71 170.63 27.08 15.87

Total Deposits 79623.13 70580.05 9115.09 12.93

The comparative position of deposit mix of the Bank as on 31.12.2012 and 31.12.2011 is depicted below:

7.1.7 Loan and Advances:

Though there was an unfavorable business environment due to political turmoil throughout the

years JBL was in constant efforts to explore different areas of credit operation and could raise the

credit portfolios. In 2008 total credit was 21036.86 next year it increased by 53.48% to reach the

amount of 32287.66. In 2010 JBL’s Credit amount was reported 49734.8. 2011 was the in which

JBL’s credit reached to the top among few years. In 2012 and 2013 it was respectively 54887.03

and 63069 million. In order to ensure compliance with regulatory requirements for avoiding risk

of exposure to single borrower, concentration on large loans, to bring in excellence in credit

operation in relation to risk management, yield, exposure, tenure, collaterals, security valuation

etc. JBL strived for further diversification of credit portfolios. Its credit facilities were

concentrated on Trade Finance, Agriculture and related sector, project finance, wholesale

and retail trade, transport sector, hospital & diagnostic centers and syndicate financing for big

projects, capacity additions to the manufacturing sector and structured financing for developing

infrastructure of the country. Initiatives are underway for helping small and medium

entrepreneurs in the ventures for which, in JBL, we are developing SME credit products and

strategies. JBL has also increased lending activities to small consumers through Consumer Credit

Scheme.

95 | P a g e

7.1.8 Total Export

The Bank handled export business worth 68844.1 million in the year 2012. In 2011 total export

business handled by the Bank was Tk.57929.4 million. Thus there was an increase of Tk.10914.7

million in export business handled by the Bank, being 18.84 percent over the preceding year. The

major export item was ready made Garments.

96 | P a g e

2008 2009 2010 2011 2012 2013

Loan and Advances 21036.86 32287.66 49734.8 56611.79 54887.03 63069.94

5000

15000

25000

35000

45000

55000

65000

Loan and Advances

7.1.9 Total

Import:

The total import business handled by the Bank in 2012 was Tk.57705.2 million compared to Tk.55907 million in the preceding year registering a rise of Tk.1798.2 million being 3.21 percent. A sizeable L/C's were also opened by the Bank in the year under review. The import items included industrial raw materials, machinery, consumer goods, fabrics, accessories etc.

97 | P a g e

20082009

20102011

2012

0

10000

20000

30000

40000

50000

60000

70000

18617 21407

41860.4

57929.4

68844.1

Export

Export

2008 2009 2010 2011 20120

10000

20000

30000

40000

50000

60000

70000

30311.71

46685

61034.555907 57705.2

IMPORT

Import

Strengths SPersonal careRelationship bankingSmart Environment with modern thinkingEagerness to listen customers’ objectionsRegular Training process ReliabilityExperienced top managementSatisfactory capital baseLow infection in loan exposure.Prospective IT infrastructure

Weakness WLack of AdvertisementLimited market share.Exposure to large loanExcessive dependency on term depositsWeak fund managementHigh cost of fund.Islamic Branch funds are not ring fencedcharges for delivering statements

Opportunities ORegulatory environment favoring private sector DevelopmentCredit cardGood relation with customersStrong Net work InfrastructureLocker Service

Threats TIncreased competition in the market for quality assetsSupply gap of foreign currencyOver all liquidity crises in money marketNegative Attitude of clientsRules and Regulation of Bangladesh bank

Internal factors

External factors

Positive Negative

7.2 SWOT Analysis

SWOT Analysis is the analysis of strength, opportunity and threat of any product or service. Of these four important aspects the first two are related with the external environment of the company and the last two i.e. opportunity and threat are related with the internal environment of the company. Both manufacturing and service oriented business organizations start to possess some weakness as time elapse. The weaknesses of an organization can be turned into opportunities if recognized on time. Moreover, overlooking any threat may result in loosing valuable business opportunities. For this reason, an assessment of every business organization is required to judge the performance from the aspects of its Strength, Weaknesses, Opportunities and Threat (SWOT).Here, a has been made to draw a SWOT analysis on JAMUNA BANK LIMITED.

98 | P a g e

99 | P a g e

FINDINGS

During internship period in Jamuna Bank Limited at Shantinagar Branch following problems are

identified:

Lack of update products is a drawback of the general banking area of the JAMUNA

Bank. New products such as student loan, medical loan, marriage loan are not available

in JBL.

Though JBL using very popular software i.e. Flora bank on–line software but the use of it

is quite difficult for the employees.

Flora software sometimes does not work if it was logged on for a while, so the user need

to restart the program to work this is sometimes annoying.

From the clients view introducer is one of the problems to open an account. It is general

problem to all commercial bank.

JBL requires to open saving account when ever customers what to open any DPS. its

costly for the customer to maintain a savings account even if he don’t want to.

They face troubles with those clients who have not any knowledge in banking

transactions and banking rules.

As the deposit is heart of running the banking activities JAMUNA Bank Deposit growth

not good. Because JAMUNA Bank deposit rate is low other than commercial bank such

as Dhaka Bank, Prime bank Mercantile Bank, HSBC Bank, Bank Asia etc.

JBL has not recruited competent people to filling its lower and mid level position they

recruit only once a year. This is really tough to recruit high skilled employees.

As a result of technological change such as use of new software There are few staffs who

have lacking in computer knowledge are not efficient enough to finish every task

immediately so before utilizing new technology proper training should be arrange.

Clients generally complain that rate of interest for various type of credit is quite high. In

many cases productivity from loaned investment is inadequate that borrower become

incapable in repaying loan.

One problem is that bank always follows the policy of risk averse in the world today all

the organization are moving in approach of risk taking. As a result it is facing some

problems and also facing competition from other bank.

100 | P a g e

The recovery of capital in small business loan section is threatened.

JBL not providing the credit cards in market which now a day’s one of the most

important part of banking. So for it they are losing too many customers.

Customers are not fully satisfied with the service of Jamuna bank. Since a number of new

banks are coming to existence with their extended customer service pattern in a

completely competitive manner.

Now a day’s on-line banking is a very common service for private commercial bank.

JBL, provide On-line banking service but they take source charge for it, if the customers

do not use his/her mother branch.

Per-shipment inspection certificate should obtain from the exporter of back to back L/C.

Because it reduce it fraud and forgery in case of import against master export L/C, but all

the time this pre-shipment inspection certificate are not wanted by the bank

JBL does not promote itself for catering its services to the public or the business

organization.

Recommendation

Though Jamuna Bank Limited tries to give the best customer support, they have some lacking

compare to other bank of the same generation. The recommendations for this report are:

The authority should recruit more employees to serve the customers. The can recruit

experienced employee as well as fresh graduate.

The bank should introduce more products based on the market demand.

The bank should reduce their minimum balance to attract more customers.

The salary of the worker need to be rise, as a result experienced people from other bank

will be attract to join Jamuna Bank Limited.

101 | P a g e

Jamuna Bank Limited should offer international credit card, because in modern world the

use of increasing paper currencies is decreasing.

Beside social work the bank have to be more serious to get better position in CAMEL

retting.

The bank can open more branches to reach to more customers.

The bank can open branches or foreign booth because many people send money from

abroad every year to Bangladesh.

The bank should finance to the consumer goods, because many people in the country

wants to buy consumer goods from bank loan.

The marketing department of the bank should more efficient to reach at the hart of the

customer.

For the success of any organization, employee satisfaction is one of he most important

factor and JBL authority have to look about it.

The bank should be more profit concern as well as took part to the economics

development of the country.

The departments of the bank should more efficient to make profit by satisfying

customers.

The bank should use printed instruments like cheque, pay orders etc.

Being a clear transparent the bank can provide the best support to the customer as earn

profit.

102 | P a g e

Conclusion

As an organization the Jamuna Bank Limited has earned the reputation of top banking

operation in Bangladesh. The organization is much more structured compared to any other bank

operating local or foreign in Bangladesh. It is relentless in pursuit of business innovation and

improvement. It has a reputation as a partner of consumer growth.

With a bulk of qualified and experienced human resource, Jamuna Bank Limited can exploit any

opportunity in the banking sector. It is pioneer in introducing many new products and services in

the banking sector of the country. Moreover, in the overall-banking sector, it is unmatched with

any other banks because of its wide spread branch networking thought the country.

This report tries to figure out most of the indicators of problems and strengths of Jamuna Bank

Limited as a valid pretender in the competitive banking sector of Bangladesh. A severe cut throat

competition is going on currently in this sector and that’s why Jamuna Bank Limited has to work

out with different dimensions like – product diversification, market forecasting, proactive

activities undertaken by Jamuna Bank Limited and some suggestion to get rid of the

predicaments that exist.

103 | P a g e

Bibliography

Annual Report of Jamuna Bank Ltd. during 2008-2012, financial statement 2013.

International Financial Management, Jeff Madura, 9th edition

Kendrick, John. W, (1996) Productivity Trends in the United States, Princeton University

Press, Princeton, New York

Krinter, (1990 & 1991), Management, Houton Mifftin Co., Boston quoted in Haradhan

Sarkar, Productivity Commercial Banks:

Concepts and Related Issues, Bank Parikrama

Kumar Pradeep. Elements of financial management Kedar Nath Ram Nath & Co. 8th

edition.

Bank Management and Financial Services, Peter S Rose and Sylvia C Hudgins

Economic review, December 2010

JBL General Banking Credit & Foreign Exchange Manual, 2012.

Jamuna Bank Limited, Website: www.jamunabankbd.com/front/index

Dhaka Stock Exchange, Website: www.Dse.com.bd

Bank Info Beta, Website: bankinfobd.com

Bank in Bangladesh, Website: bank.bangladeshinformation.info

104 | P a g e

http://www.Dse.com.bd/

Total Banking System of Jamuna Bank Limited

Education

Transcript of Total Banking System of Jamuna Bank Limited