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NCC Bank

OVERALL BANKING SYSTEM OF NATIONAL CREDIT AND COMMERCE BANK LTD.

Prepared For
Saadat Muhammad Ayub Assistant Vice President Human Resources Division National Credit and Commerce Bank Limited

Prepared By
Famida Islam Roll: 13008, Reg: 1160 (13th Batch) BBA

INSTITUTE OF BUSINESS ADMINISTRATION DARUL IHSAN UNIVERSITY

October 25, 2005 Saadat Muhammad Ayub, Assistant Vice President, Head Office, Human Resources Division: National Credit and Commerce Bank Limited, 7-8, Motijheel C/A, Dhaka-1000. Subject: Prayer for acceptance of Internship report. Sir, Here is the report on Study of overall banking system of National credit and commerce bank Ltd. This compulsory of the three-month internship program. This internship program gave me the opportunity to have an experience to the practical knowledge and on-the-job experience in NCCBL. I have acquired practical knowledge on accounts opening, check-book issuing, L/C opening dispatch, function of cash department, remittance and clearing of bills, loans and advances, customer dealings etc. I have given my best effort in preparing the report and to make it a worthy one. Each aspect of the topic to cover as required and as per direction. I would like to appreciate any suggestion or recommendation for further improvement of the report. Sincerely yours, Famida Islam, Roll:13008, Reg: 1160 BBA (13th Batch), Institute of Business studies, Darul Ihsan University.

Declaration of Student

I, Famida Islam, hereby declare that the internship report titled The Overall Banking system is prepared after the completion of my internship at National Credit and Commerce Bank Ltd, Dhanmondi Branch under the internship instructor and guidance of Firoz (Advisor), Internship program, BBA, Institute of Business Studies. I also declare that the paper is my original work and prepared only for academic purpose, which is part of BBA program.

Sincerely yours, Famida Islam Roll: 13008, Reg:1160 BBA (13th Batch) Institute of Business studies Darul Ihsan University

Acknowledgement
At the very beginning I would like to thank the Almighty Allah for bringing me to this world. I am grateful to him for all his kindness that keeps me going. I am especially thankful to Dr. A.M.M. Baquer, Director, IBS, Darul Ihsan University, for issuing a forwarding letter to National Credit and c letter to National Credit and Commerce Bank., Dhanmondi Branch, where my internship program has been carried out. It is my pleasure to express gratitude to Mr. Firoz Ahmed Faculty of IBS, Darul Ihsan University, for his guidance and appropriate suggestion that inspire me while preparing this report. I will be ever grateful to for his valuable corporation in time to time. My sincere thank is due to Md. Nurul Amin and Kazir Md. Shafiqur Rahman, Senior Executive Vice President of National Credit and Commerce Bank Limited, A.K. Md. Siddique, Mohammat Khan and Azhar Hossain Khan ( Executive Vice President), Aziz Ahmed, Abdul Malek (Vice President). I especially thank thank Mir Zahir Hossain Director of National Credit and Commerce Bank Limited, for his support that brings me the opportunity to work as an internee in the National Credit and commerce Bank Limited. I am thankful to Md. Zakir Hussain (Credit Division), T.M. Farque Chowdhury and Khan Jahan Khan Senior Vice President, of NCC Bank Limited, Md. Manjum Ali, Md. Kamal Uddin and S.P Bhattacherjee Senior Asstt. Vice President. I remember the support from Mr. Ishtiaque Ahmed, Manager, National Credit and commerce Bank, Dhanmondi Branch. Last of all, In convey my profound gratitude to all the faculty members of institute of Business Studies (IBS) department because their teaching in the last four years in the various courses has enabled me to do this report. At last I would also like to thank especially me parents for their continuous support. Sincerely yours. Famida Islam

Chapter Number Chapter-1

Name of the Chapter Introductory Part The topic and its important Scope Objectives of the study Methodology Study period Limitation Terminology Banks Overview An overview of National Credit

Page Number 1 1 2 2 3 4 4 5 6 7 8-13 -22 -32-8 9-12 13 13-17 17-18 19-24 -43 3-6 5-7 7-9 9-13 14 14

(INSIDE)

Chapter -2 (INSIDE) Chapter-3

and Commerce Bank Ltd. Dispatch Section Arrangement of the Dispatch Section General Banking Account opening section Clearing section Cash Section Remittance department Account section Other activities Foreign Exchange Incoterms Rate of exchange Documents used in foreign trade Opening L/C (cash) Export/Import policy Amendment of L/C Renewal of L/C

(INSIDE) CHAPTER -4

(INSIDE)

Chapter Number Chapter-5 (INSIDE) Chapter-6 (INSIDE)

Name of the Chapter MoneyGram History of the moneygram policies Mission of the moneygram policies Moneygram policies and Procedures Credit Appraisal & Credit Management Principles of the good lending Purpose of the lending Function of the loan Types of loan and advances Loan sanction authority Sectoral distribution of advance 2004 Selection of borrower Selection of investment party Supervision & recovery procedure Loan classification and provisioning Organogram of Credit Division (NCCBL) Customer Relationship Banker-customer relationship Deposit mix-2004 (NCCBL) Banks performance Financial highlights (2000-2004)

Page Number -53 3-4 4-12 6 3-5 5 5-6 6-13 13-15 16 17-20 21 21-22 22-24 25 7 3-14 4 -83

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Chapter-7 (INSIDE) Chapter-8 (INSIDE)

Chapter Number

Name of the Chapter Reserve fund & other reserves Position of investment & advances Funded and Contingent Assets2004 Operational profit of market Liquidity statement (as at 31 dec. 2004)

Page Number 4-5 6-8 9 9 10 11 11-15 16

(INSIDE)

Financial statement (borrowing from other banks) Notes of the financial statements Auditors report to the shareholders Banking risk exposure (NCCBL) 17 9 1

Chapter-9 (INSIDE)

Conclusion Part Conclusion

CHAPTER 1

INTRODUCTORY PART

INSIDE

BANK

BACKGROUND OF THE STUDY TOPICS & ITS IMPORTANT OBJECTIVE OF THE STUDY METHODOLOGY, STUDY PERIOD & LIMITATION TERMINOLOGY BANKS OVERVIEW ANOVERVIEW OF THE NCCBL

THE TOPIC & ILTS IMPORTANCE


I was asked to work on overall banking in the National Credit & Commerce Bank Ltd. (NCCBL) at Dhanmondi Road Branch, Dhaka. Bank plays an important role in the business sectors and in the industrialization of a country. Banks take deposits from the customers against interest and lend it to the borrowers against interest for a time being. To perform these functions bank has to do a lot of works such as deposits collection, loans and advances appraisal and management system, foreign exchange transactions, general banking etc. Hence these issues of banking have been selected for study. The banks works within some conceptual frameworks such as GAAP & IAS, Which are guidelines of the whole process. So the application of GAAP & IAS in the preparation of financial statements is very important.

SCOPE
The scope of this report is limited to assess the practical functioning of the whole banking activities. This report will cover the banking system of the National Credit & Commerce Bank Ltd. (NCCBL). The other objectives are as follows: To fulfill the requirement of our B.B.A program To evaluate the overall performance of the National Credit & Commerce Bank limited.

OBJECTIVES OF THE STUDY


The main purpose is to be familiar with real of the important business sectors in Bangladesh. Traditional system of study is totally obsolete in current world. If I have no practical knowledge with theoretical knowledge, I cannot complete in the job market. For that reason I have some objectives of my study. The study mainly conducted with following objective: To Understand how important commercial bank are functioning of a modern economy and financial system. To observe the Foreign Exchange Operation of Nation of National Credit and Commerce Bank and their service. To see how the commercial and regulated and to earn practical knowledge. To observe the post important financing operations. To apply theoretical knowledge in the real situation. To identify the problems of its financing. To analyze and evaluate the customer service of National Credit and Commerce Bank. To have a clear idea about the various aspects of customer services provided by National Credit and Commerce Bank. To know the investment decision. To know the mode of investment. To do the practical work. To know the follow up process for recoveries. To learn the organizational behavior. To learn the making process of the proposal for approval of the head office. To learn the Lending Risk Analysis (LRA). To know the dealings process with the Bangladesh Bank (BB). world situation and practical

experience in a business firm. Commercial bank, especially private bank is one

Above all, to know the overall banking process.

METHODOLOGY
To prepare a report gathering data is very important though it is very difficult. It is difficult because the employee of an organization does not disclose the real things of the organization. It is also needed to study different kinds of books, magazines, journals etc. I collected data by two sources-primary sources data and secondary sources data. Primary Sources Data: During my internship program, I worked in different sectors (dispatch, accounts opening and remittance, accounts, investment, loan department, clearing section, cash payment section and foreign exchange department). From every sector I gathered different kinds of information relating to that particular section. I always discussed about the different terms with executives of the organization. Sometimes I spoke with the client of the bank to know the fact. Above all I observe and did every thing very carefully and noted down that instantly in y notebook for me report purpose. Secondary Sources Data: I collected data from the banks manual, circular file. Besides, I took help from different kinds of books, magazines and journals and the website on the National Credit and Commerce Bank Limited. STUDY PERIOD The internship with National Credit & Commerce Bank Ltd. (NCCBL) at Dhanmondi Road Branch is part of my BBA program that duration is 15th July to 15th October, 2005 by the decision of university. This attentively three-month internship helps me to achieve objective of the study

LIMITATION
The Internship was only for twelve weeks, of which first four weeks have been spent in orientation to the organization and concerned department. It was very difficult to collect all the required information in such a short period. Due to some legal obligation and business secrecy banks are reluctant to provide data. For this reason, the study limits only on the available published data and certain degree of formal and informal interview & limited survey though questionnaire. Although the particular study is extremely extensive in nature, hard effort was given to make the study worthwhile and meaningful even then three exists some limitations. These are as follows:

Due to some legal obligation and business secrecy banks are reluctant to provide data. For this reason, the study limits only on the available published data and certain degree of formal and informal interview. Due to budget constraints, the survey could not be made up to desired level. National Credit & Commerce Bank Ltd. (NCCBL) did not provide and kind of pay and allowance for the period of internship, which is very unethical. Although I have put the best efforts to meet the report objective however due to the short period of time the detail information gathered May not possible. Finally, my personal scantiness of knowledge especially in research, studies and banking activities.

Terminology

NCCBL = National Credit & Commerce Bank Ltd. ATM = Automated taller machine T.C = Travelers cheque S.P = Sanchaya Prata A.O.F = Account Opening form C.D = Current deposit D.D. = Demand draft S.T.D = Short term deposit S.D.S = Special deposit Scheme F.D.R = Fixed deposit receipt L/C = Letter of credit L.T.R= Loan against trust receipt L.I.M = Loan against imported merchandise E.L.C = Export letter of credit F.B.P = Foreign bills purchase F.B.C = Foreign bills collection F.D.D. = Foreign demand draft T.T. = Telegraphic transfer C.C. = Consumer credit P.O = Payment order P.S = Payment order A/C = Account

LR = Local Remittance PAD = Payment against Documents SVP = Senior Vice President

BANKS OVERVIEW
Banking Sector in Bangladesh: In 1971, Bangladesh, which was East Pakistan, emerged as an independent country. It immediately nationalized all the banks excepting 3 foreign banks. Six nationalized banks were thus formed. In 1983 a new industrial policy was implemented allowing private sector participation in industrialization. As a part of this process, two nationalized commercial banks were again denationalized and a number of private commercial banks were allowed operating. Scheduled Bank in Bangladesh: (According to Bangladesh bank clearing house). In total 41 banks operate in different categories of banking in Bangladesh. Nationalized Commercial Banks Private Commercial Banks Specialized Banks Foreign Banks Co-Operation Bank Grameen Bank Table : Scheduled Bank in Bangladesh ( Source: Journal of IBB) 4 19 4 12 1 1

Banks pay a very important role in international trade. Now a day no country can thrive without international trade. Moreover banks provide some other non-

traditional services like factoring, issuing guarantees; when are very much supportive to modern business. AN OVERVIEW OF NATIONAL CREDIT AND COMMERCE BANK LTD. Historical Bacground of NCCBL: National credit and commerce Bank Limited was incorporated in Bangladesh as a banking company on under the companys act 1994. The Bank started its operation as on 1985 year. The principal place of business is the registered office at 7-8 Motijheel Commercial Area, Dhaka 1000. It has 36 branches all over Bangladesh. The Bank is listed in the Dhaka and Chittagong Stock Exchanges as a publicly quoted company for its shares. With its firm commitment to the economic development of the country, the Bank has already make a district mark in the realm of private sector banking through personalized services, innovative practices, customer services, dynamic approach and efficient management. The Bank, aiming to pay a leading role in the economic activities of the country, is firmly engaged in the development of the trade, commerce and industry through a creative credit pricy. NCC Bank has also positioned itself as an established Correspondent Bank. Through a worldwide network of 260 correspondent banks NCC Bank is present in all key areas of the globe. Economical Background of NCCBL: National Credit and Commerce Bank is a conversion of erstwhile National Credit Ltd (NCL), an investment company largest of its kind in the established on 25 Nov 1985. National Credit and Commerce Bank Ltd. started their new journey with the paid up capital of 5.00 crore taka of that time. But present paid up capital of the Bank stands at tk. 48.05 crore.

Vision:

To provide quality services to our customer. To set high standards of integrity. To extend our customers innovation services acquiring state-the-art technology blended and brings total satisfaction to our clients and employees.

Mission:

High quality financial service with the help of latest technology. Fast & accurate customer service. Attract & retain quality human resource. Achieve balanced growth & equitable development. High standard business ethics & ensure equity justice in economic activities. Deep commitment to the society and the growth of national economy. Innovative banking at a competitive price. Extend financial assistance to poorer section of the people. Steady return on Shareholder equity.

Ethics & Social Responsibilities: An organization cannot move along. Organization needs people to generate its activities & People needs organization to get some kind of services. National Credit and Commerce Bank is an organization that is concern to maximize its profit along with maintains some kind of social responsibilities. It is fully devoted to fulfill the needs for its customer satisfaction as well as it is involved social economic development activities.

Branch Network of National Credit and Commerce Bank : NCC is the Private bank in Bangladesh. There are 36 prances all over the country. Among them 15 in Dhaka region, 11 branches in Chittagong region, 1 branch in Khulna region, 4 branches in Sylhet region, 1 branch in Jessore region, 1 branch in Rangpur region, 1 branch in Noakhali region, 2 branch in Rajshahi region.

Dhaka 15 Jessore 1 Sylhet 4

Noakhali 2

National Credit & Commerce Bank Ltd.

Rangpur 1

Rajshahi 2 Chittagong 11

Khulna 1

Figure : Total Branch of the National Credit and Commerce Bank Limited.

Management Hierarchy:

CHAIRMAN BOARD OF DIRECTORS MANAGING DIRECTORS ADDITIONAL MANAGING DIRECTORS SENIOR EXECUTIVE VICE PRESIDENT

Chief Officer

Senior Officer Junior Officer Assistant Officer

National Credit and commerce Bank Limited

Chairman Advisor Board of Directors Mannaino Directors

Secretariat Board Affairs Share Dept.

Credit Policy Committee

Central Credit Committee

Assets & Libility Committee

Special Accounts committee

Systems & Procedure Committee

Operation

Innovative Service Division

Human Resources Division

Financial Institution Department

Treasury & Central Account Division

Investment Division

Credit Division

Audit & Risk Management Division

Figure : Organizational Structure of NCCB.

Board of Directors
Chairman .............................................................. Mahbubul Alam Tara Vice Chairman .................................................... Amjadul Ferdous Chowdhuy Nurul Islam Md. Abdul Awal Principal M Wazhiullah Bhyiyan Abdus Salam Minhaz Bin Kamal Mir Zahir Hossain Ayesha Akhter Khondkar Zakaria Mahmud Md. Anwar Pasha Mostafizur Rahman Yakub Ali Mohammad Ali Tofazzal Hossain Alhaj Md. Nurun Newaz M.A. Quasem Din M. Rana Md. Abdul Salam Talukdar Md. Harunur Rashid Khairul Alam Chaklader MANAGING DIRECTOR ............................. M. Aminuzzaman SECRETARY ....................................................... Md. Tarikul Alam Auditors ................................................................ B. Alam & Co. Chairtered Accountants [ Source NCCBL Annual Report 2004] ******************** Directors ............................................................... A.S.M. Main Uddin Monem

CHAPTER 2
DISPATCH SECTION

INSIDE

BANK

ARRANGEMENT OF THE DISPATCH SECTION

Dispatch of Section Of National Credit & Commerce Bank Ltd. Dhanmondi Branch Dhaka.

ARRANGEMENT OF THE DISPATCH SECTION


Inward and outwards mails is said to be Dispatch. It is said that the banking activities begin from the dispatch section. This section is important because all inward mails are recorded here. The dispatch is primary divide into two categories: Inward: It means what care receives form the outside. Out Word: It means what are sent to the out side. This dispatch is also known as Mail. One person is working in this section. The letters of all sections come to this section. After giving entry in the registration books the letter are sending to the outside. There are some peons who bear this letters. Besides the letters and send by courier or by telex or by mail. It includes all correspondence, letters, statements and returns and telegrams. This dispatch also divided into1. 2. 3. Ordinary Registered and Local.

Every correspondents should have an office copy and one additional copy which are to retained in the Master file of the office. On the other hand when an letters come to this office, than this section received the letter fast and then gives entry in the registration book. After completion register he sends to the addressed entry in the book. After completion register he sends to the addressed person. The employee of this section also operates computer. He maintains inward registration book.

********************

CHAPTER 3

GENERAL BANKING

INSIDE

BANK
ACCOUNT OPENING SECTION CASH SECTION CLEARING SECTION REMITTANCE DEPARTMENT ACCOUNT SECTION OTHERS ACTIVITIES

General Banking system of National Credit & Commerce Bank Ltd. Dhanmondi Branch Dhaka.

Introduction
General Banking is the starting point of all banking operation. It is a combination of activities of different sections. General banking has some section in the bank. Thee sections are as follows:

Accounts Opening Section. Cash Section. Clearing Section Remittance Section Accounts Section Others.

Account Opening Department


It is a customer service section. Here three employees of the bank are always ready to serve their customers. In this section people come to open different kinds of accounts, and schemes. They advice their clients that how can they (clients) open an accounts, and schemes. They are very friendly and cordial to their clients. Here the employees also issue new checkbooks, remit money the financial instruments. They maintain different kind or registers such as DD. TT, Pay order register, account opening register, locker opening register, checkbook issue register, balance book, cheque-cleaning register and transfer register. They also use computer for posting purposes.

Objectives or Necessities of Opening Bank Account:

Safety preservations Creation of savings attitude Facilities of risk less income Formation of national capital Economic development Establishment of social securities Getting banking services

Types of Account: Deposit Account/Saving Account is given below: DEPOSIT ACCOUNT / SAVING ACCOUNT Opening of an account binds the banker and the customer into a commercial relationship initially all the accounts are opened with a deposit of money by the customer and hence these accounts are called deposit accounts. Accepting of deposits of money from the public is one of the essential functions of a banker according to the definition of banking given in the banking Act 1991. This is such kind of account that provides a rate of profit on the principal deposit. Saving account can be single or joint. Besides educational institutions, clubs/societies, associations and financial institution can also open the saving account. In the NCCBL saving account is denoted as SB.

Three are rules governing Deposit Account and they are as follow:

It is opened on proper introduction with minimum initial deposit of tk. 500 (five hundred) only for all cases. The bank then provides the customer with pay-in-slip, a cheque book, a pass book/statement of account. But initial deposit can vary with relationship of the customer.

The deposit is accepted on the basis of commercial rules and the fund is invested in accordance with business principles. 60% of income of the bank derived at present. from the investment (minus the

investment out of capital of the bank) is distributed among the depositors

If the amount of deposit at any times becomes less than taka 500.00 only in any month it shall not be eligible for profit, until it again reaches the limit of tk. 500.00 only.

The profit is credited to the account to the next period (June and December each year). If the profit is not withdrawn it will automatically be added to the principal amount and entire amount will earn profit/loss.

Withdrawals from the account are allowed not more than two times in a week and for a total amount not exceeding one for the of total deposit on tk. 10,000.00 (ten thousands) only which ever is less. For withdrawals of large amounts, seven days notice in written is required to be given. In the contravention of the rule, the depositors will not be given any profit in this account for that month.

Alternation/addition of rules shall be made with the consent of the depositors.

PROCEDURES OF OPENING SAVING ACCOUNT: To open SB there are some responsibilities both the customers and bankers. The responsibilities are as bellow: Responsibilities of Customers:

Customer will fill up the Account Opening from (AOF) properly. Customer should submit two copies passport size photograph of the account holder along with Transaction Profile and Known your Customer Form (KYC) to be obtained.

Customer should submit Driving License. The Introducer must have an account with the bank The customer can select one or miire nominee and give his/her/their two copies photographs. The customer must sign on specimen Signature Card (SSC) and the introducer must sign the form. The signature must be that by which the customers operates his/her transactions. In the case of minor account, a minor is not capable of binding a

valid contact under law and as such, cannot open a bank account. But in practice a minor is not disallowed to open an account with the idea that so long such an accounts remains in credit balance, that is the minor remains a creditor, there is no risk on the part of the banker. Responsibilities of Bankers:

The specimen signature should be verified. The verification seal will be given on the form along officers signature. Acceptance of specimen signature seal will be given. with authorized

Managers approval seal with signature of manager will be given on the form. A copy of photograph will be added to the form, and to the SSc. New account will be given on the form and on SSC from the list of the account number. Introducer signature should be verified. At least two signatures of the SSC are taken in front of responsible officer. The banker should check the instruction of opening register. Checking the account properly introduced as per head office (HO) instructions. Checking past transactions and present balance of introducer satisfactory. Thanks letter to be sent to the customer to his/her present address. Contact addresses should be verified.

CURRENT ACCOUNT: This kind of account does not provide any interest on total balance; usually business persons/organizations opened such kind of account because this account provides the facility of unlimited times of withdrawal of money. The current account is denoted as CD/CA. In the bank, there are seven kinds of current accounts. Each account requires some documents. The table, given bellow will show the types of account. There are also some responsibilities both the customers and bankers.

Responsibilities of Customers:

Two copies passport size photograph of each person who will operate the account. The introducer must be account holder. Signing on the SSC. If the account holder wants to give authority to other person to operate the account he must sign on the Mandate Form where the authorized persons specimen signature will also be attested by the account holder. The authorized person will sign on the SSC as well.

Responsibilities of Bankers:

Carefully check the AOF and signature card. Varify the introducer signature. All papers are checked are carefully. Such account becomes a loan account so bankers should be careful of the time of opening the account. Giving and account number on AOF.

Types of Current account & Documentation of a new account


SL. No 1. 2. 3. Types of Accounts (A/C) Current A/C (individual) Current A/C (Jointly) Current A/C (Proprietary Concern) Documents Required for Opening a New A/C 1. AOF 2. SSC 1. AOF 2. SSC 3. Special Instruction 1. AOF 2. SSC 3. Partnership Deed 4. Partners Agreement to open A/C 5. Municipal Trade License 1. AOF 2. SSC 3. Partnership Deed 4. Partners Agreement to open A/C 5. Municipal Trade License 1. AOF 2. SSC 3. Memorandum and article of Association 4. Certificate of incorporation 5. Municipal Trade License 6. Board Resolution Regarding Opening of A/C and Authoriation 1. AOF 2. SSC 3. Board Resolution Regarding Opening of A/C and Authorization 4. Certified True Copy of BuyLaws/Rules & Regulation/Constitution 5. List of member of executive committee 1. AOF 2. SSC 3. Trust Deed 4. Full particulars of the board of trustees 5. Resolution about opening & operation of an account.

4.

Current A/C ( Partnership)

5.

Current A/C (Public Ltd. Co.)

6.

Current A/C (Societies/ Clubs/Association/ Others)

7.

Current A/C (Trust)

Table : Types of Current account & Documentation of a new account

CLEARING THE CHEQUE:


Before clearing the cheque will briefly know about the cleaning House. A Clearing House is an institution of credit where reciprocal liabilities of the local bands are counter-balanced against one another. In Bangladesh Clearing House started about 1972. The clearing House sits in Bangladesh Bank and cover only Dhaka City Corporation Cleaning House sit for two times in a day. In course of its business each ban receives from its customers for collection a large number of cheque and drats payable at other banks. The collection of these instruments presents a big problem. Similarly each bank may to made payments to others bands in respect of cheque drwan on it and deposited with the other banks for the purpose of collection. Then cheque received for collection from its customers. Clearing House provides the mechanism for received for collection from its customers. Clearing clearing such transactions reciprocal House provides the mechanism for between banks. Clearance involves offsetting

claims against one another and setting merely such balances of

differences as remains outstanding. A Clearing House ensures many advantages. In the absence of Clearing House, each bank has to send its messenger to every other bank, present the cheque and draft across the counter and collect amount of cash. Similarly, each bank has to pay cash every day for cheque presented across its counter by the other local banks. A clearing House prevents frequent and tedious walks by a banks employee for the collection of cheque and drafts thus ensure convenience and economy. Only the differences of the mutual claims are settled and hence the banks can carry lesser cash reserves.

Customers deposit cheque to the bank with the deposit slip. Bank accepts the heque and gives the following seal: Instantly give cross seal and check the cheque carefully. If there is bank name in the cheque then received payment for the concern bank and branch seal is given. If there is individual name then payees credit for the concern bank and branch seal is given. If there is individual name then payees credit for the concern bank and branch seal is given. After the giving all entries into the computer a list of all cheque and bank print out the cheque list. With the print out sheet all cheque are sent to the representative of the Clearing cheque. That means the principal branch of NCCBL deals with the Clearing cheque. That means the principal branch is representative of Clearing House. In the house every representative delivers to other the cheque and other claims that his bank hold against them. Similarly, he receives from others the claim that they hold against his bank. Check and other instruments dishonored are return to the concerned representative. Each representative adds the amounts receivable and payable and balance is stuck. Transferring balance kept at the central bank by the members of Clearing makes the final statement. The customer can get amount within two days after depositing the cheque.

Inter Branch Credit Advice (IBCA) :


It is an advice written by originating branch to the responding branch to credit the general account of responding branch for the transaction mentioned on it. IBCA issued to responding branch to pay. the responding branch makes payment. Accounting: Debit: NCCBL General Account-Responding Branch.

Credit: NCCBL General Account-Originating Branch. Inter Branch Debit Advice (IBDA): It is an advice written by originating branch to the responding branch to debit the general account of responding branch for the transaction mentioned on it. IBDA issued to collect money other branch. The orginating branch collects money. Accounting: Debit: NCCBL General account-Responding Branch Credit: NCCBL General account- Orginating Branch. Outward Bills for Collection (OBC) Collection of cheques of a bank outside the clearing zone is known as OBC. Suppose a party which have an account with the NCCBL, Motijheel Branch, submit a cheque a Sonaly Bank of Branch. In this case a the bank does a not send the cheque to the Cleaning House rather than they send OBC to the Sonaly Bank. Tongi Branch to collect the amount. System of PBC Lodgement: 1. 2. 3. Accepting the instrument with deposit receipt from the clients. Investing the instrument and deposit carefully especially, date of the chque, amount, account number, name and sign of depositor. The following seals are applied on the instruments: Special Cross Seal OBC Seal with OBC Number 4. 5. Entry is given in the OBC rregister. Making two copies of schedule. One is enclosed with the instrument for collection and other is kept as office copy.

Accounting: Debit: Outward-Lodged. Credit: Outward Bills-Collection. If the cheque honors then the accounting process would be: Debit: Outward Bills- Collection. Credit: Outward Bills-Lodged. Debit: IBCA and Number Credit: Party Account and Number Commission: 1. 2. 3. 4. Tk. 1.00 to tk. 15000.00 ------Tk. 25.00 only Tk. 15001.00 to tk. 10000---- Tk. 40.00 only and 15% VAT on Commission. Tk. 100000.00 to Tk. 500000.00-------Tk. 150.00 only and 10% VAT on Commission. Over Tk. 5000.00-Minium Tk. 500.00 only & Maximum Tk. 2500.00 only and 5% VAT on Commission.

Inward bills for collection (IBC) : When chequees of other branches that are situated out side the Clearing House come to a branch of the same bank then the whole process is known as IBC. This time an IBCA is send to the OBC sending branch.

CASH SECTION:
Cash department is the most important and sensitive section of the branch that deals with all kinds of cash transactions. All cash receipts and payments are made through this department. Cash deposit is for --- Savings deposits, Current deposits, Utilities bills, Loan repayment, Amount for DD, PO etc. On the hand, cash Disbursement (pay out) is for- Cash withdrawals from savings account, current account, disburse loan amount etc.

REMITTANCE DEPARTMENT
Remittance of fund means transfer of money from one place to another place or one city to another city of the same bank within the country is called local remittance and fund transfer to outside the country through correspondent agent is called foreign remittance. ISSUANCE of TI.T: Telegraphic Transfer (TT): This is a modern process of transferring money. In this process money is remitted through telex, telephone. In this process, a party can transfer money within short time. The desire person can get money instantly. The most important part of a TT is its Test Number. The test number is important to make payment. If the test number of the originating branch matches with responding branch, only then the TT payment occurs. The process of incoming and outgoing TT has been described below. Incoming TT: TT receive through telex or mobile.

A TT voucher is prepared then. If test agree then payment is given. Accounting: Debit: NCCBL General Account- Originating Branch. Credit Bills Payable Account- TT Payable. Debit: Bills Payable Account- TT Payable Credit Party Account Outgoing TT: Party fits up the TT application form. The form contains the payees account name, responding branch name, amount in words, and figure, commission charge, tele/telex charge, applicant name and signature and address. The party will deposit the TT amount along with commission and tele/telex/mobile charge at the cash counter. A cost memo is given to the party. The voucher will be made and authorized officer signed the voucer. The TT will be delivered the responding branch either telex/telephone.

Accounting: Debit: Bills Payable Account- TT Payable Credit Party Account Debit: Bills Payable Account- TT Payable Credit Party Account

PAY ORDER :
The pay order is an instrument used as an alteration of physical cash. It is applicable only for Dhaka City. They use specific Pay Order Block. They use specific Pay Order Block. It has some special features and they are It is an order to pay the account mentioned on the Pay order Block. The issuing branch will make the payment. Pay Order must be Account Payee. To issue a Pay Order the following steps are followed: The party will fill up the Pay Order from containing the favoring name, amount in figqure and words, applicants name, address, signature and date. The authorized officer will fill up the commission voucher attached to the pay order form. The party must have an account of the bank. The party will deposit the amount of the pay order along with the commission. Then the officer prepares a Pay Order Block. The block has three parts-one for the bank and the remaining parts belong to the applicant. The two small parts contains the beneficiary name, applicant name, amount in figure and date. The main block contains the date, beneficiary name, and amount in words and in figure. Signature of two Power of Attorney (PA) holders will be given on the pay Order Block. Applicant will receives the Block signing on the backsides of the portion.

Commission: 1. Commission fixed on Payment order Tk. 50.00 2. Other Liability Account-15% VAT on commission.

DEMAND DRAFT (DD): Demand Draft (DD)


DD is a one kind of bill of exchange. DD is the most frequently used mode of inland remittance. DD is an unconditional order of the bank from one branch to another branch to pay certain amount of money to certain person for demand. It is applicable outside the Dhaka City. The DD generally issued for partys safety. If there is a huge amount to bear one place to another, then customer can do the DD and bear it to his destination instead of cash. Commission:

Minimum Tk. 50.00 only or 10% of Purchase Amount. When the amount will be exceeded more than 50000.00 than the commission will be counted as 1% interest rate. Postage liability account-15% VAT on commission.

Bankers Cheque (BC): BC is used only to make the payment of different kinds of bills like utilities bill of the bank. Some special features of BC are as follows:

It should be CROSSED CHEQUE and account PAYEE only. There is no commission for issuing a pay slip. Bank is the maker of the pay slip. A revenue stamp is required in case of payment.

It has two parts: one part belongs to the account payee and the other to the bank. The first part contain the date, beneficiary, amount in figure and for which purpose the bank issue the BC and second part contains two date (issuing date and payment date), beneficiary, amount is figure and in words. ]

Accounting: Debit: Others Liability- Adjusting Accounting Credit. Credit: Bills Payable Account-BC issued.

ACCOUNT SECTION
Account Section is the heart of the bank. Because it maintains all account of the bank. So, it is very important section. The employee of this section should have sound knowledge in accounting and should have patience. The should work with cool headed. All of them are very sincere regarding their risks. This section deals with employees salary and allowances, machineries and payment of labor cost and employees conveyance etc. in case of leave of absence employee collects prescribed form this section. This section is related with all departments. All types of books and records related to the branchs internal or external income and expenditure, financial performance are maintained here. Computer programs are used in this section to prepare positing of entires, daily statements. In geral, they deal with the following transaction:

Cash- cash receive or payment. Clearning- clearing cheque, DD etc. Transfer-transferring amount from one account to another

After getting the vouchers from all sections the account section starts its work. After getting the vouchers from all the sections is the beginning of the

account section. Different section creates vouchers and those send to the account section.

The employees of the account section firstly entry transfer vouchers in the transfer book. Then they separate that vouchers into debit and credit. After separation they find out which for cash, which for clearing and which for transfer. Now they write them in the supplementary. They maintain supplementary for different head such as bills payable, bankers liability, customers liability, demand draft, suspense account, sundry account, vat account, loan account etc. Each supplementary have cash, cleaning, transfer columns. There are two types of supplementary and they are

Deb Supplementary .... contains the debited cash, cleaning and transfer. Credit Supplementary .... contains the credit cash, cleaning and transfer.

The add all cash, clearing and transfer separately and transfer them in the rough cash book or summary sheet. In the rough cash-book both cleaning and transferring debit and credit must be equal. But debit and credit of cash may not be equal. One interesting thing is that after adding closing balance of previous day with credit cash balance of that day and adding closing of that day with balance then cash balance of debit and credit must be equal. After complete supplementary they identify their debit amount and credit amount among the activity report. They also prepare weekly statement and monthly state statement they mainly prepare deposit statement, monthly account statement financial position in the bank, salary statement.

Vouchers come from different sections

Posting as vouchers, Entry transfer vouchers in to the transfer book

Separation of debit and credit vouchers

Separate cash, transfer and cleaning vouchers

Complete the supplementar y

Figure : Summary of daily Tasks

OTHERS ACIVITIES
ISSUANCE OF NEW CHEQUE BOOK: The steps to issue a new cheque-book for both saving and current account are given bellow:

The account holder will fill up the Cheque requision Slip and will be submitted. The authorized officer will match the signature on requisition slip with the signature on the SSc. The authorized officer will check weather all the leaves of the previous cheque book have been used or not. If in both case answer is positive then the officer can issue a new cheque book. The officer will tale a new cheque book and seal the account number on every page. The issuing date and name of the account holder will also be written on the requisition slip of the cheque book. The officer must sign on every leaf of new cheque book. The serial numbers of new cheque book are also written on the old requisition slip. Entry will be given in a cheque issuing register and take the initial of the account holder. New series will be posted on the computer against that account.

CREDIT CARD SERVICE: National Credit and Commerce Bank Limited introduces Credit card of VISA brand with access both in intentional and local market to ease financial worries at times of need. Wide Acceptance: NCC Bank Credit Card is accepted at over 3,500 Merchant outlets around the country. VISA merchants include hotels, restaurants, airlines & travel agent, shopping malls, departmental stores, hospitals & diagnostic centers, jeweler shops, electronics & computer shops, leather goods, mobile & internet service providers, petrol pumps and many more! This number is increasing day by day. Interest free Credit facility: NCCBL others VISA Card with interest free credit facility. Pay in full total dues as mentioned on the statement within the payment due date and thus enjoy a free credit facility from 15 days to 45 days except cash withdrawals. Cash advance facility: NCC Bank Credit Card is accepted at over 3,500 Merchant around the country. VISA merchants include hotels, restaurants, airlines & travel agent, Shopping malls, department stores, hospitals & diagnostic centres, jeweler shops, electronics & computer shops, leather goods, mobile & internet service providers, petrol pumps and many morel! This number is increasing day by day. Interest free Credit facility: NCCBL offers VISA Card with interest free credit facility. Pay in full total dues as mentioned on the statement within the payment due date and thus enjoy a free credit facility from 15 days to 45 days except cash withdrawals. Cash advance facility: Cash drawing facility, through approved channels, is available in some cases to meet of the emergency requirement up to 50% of credit limit. Safe & Secured: Save & Secured: Do not need to carry anymore ifboday carrying NCC Bank Credit Card Supplementary Card Facility: Anybody can apply for Supplementary Cards for the spouse, Parents, Friends or children over 18 years of age. For his peace of mind, he can assign monthly spending limit on each supplementary card. Minimum payment due amount calculation:

When the total due in the statement is less than or equal to anybodies approved credit card limit, minimum repayment for the current month is:

For International Card: 5% of total due or USD 25 whichever is higher. If total due is less than USD 25, it must be paid in full. For local card: 5 % of total due or Tk. 500 whichever is higher. It the total due is less than Tk. 500, It must be paid in full.

Incase of overdue amount : 5% of total due plus minimum payment due amount of previous statement.

NCCBL Credit card gives the opportunity of being flexible in the repayment schedule suiting to the convenience. The cardholder receives a monthly statement showing the details of his/her transactions. If he/she repay the minimum payment amount as shown on his/her statement of card account with the payment due to date, late payment fee full be charged in such way NCC Bank all-time allured to their customer service. DEBIT CARD SERVICE: National Credit and Commerce Bank is very much conscious for their service for their valuable clients. For this reason, NCCBL starts to use ATM card to the market in 1991. NCCBL believes that they can improve their customer services by this system. The term and condition stated in this agreement relate to the availing of cash, withdrawal and other electronic payment services by using NCCBL, E-cash ATM/Debit card on the cardholders account designated for the purpose. There are some agreement purposes which between cardholder and NCCBL. For these agreements the bank gives services to this client or charholder

This agreement means team and condition for each cardholder.

ETN means Electronic Transactions Network Limited, provider of electro ways network of shared ATM, POS and other electronic payment services in Bangladesh;

Designated Account means the accounts approved by the bank to be accessed through the card, Card means NCCBL E-cash ATM/Debit card issued by the bank and ETN to the cardholder. Cardholder means the person to whom Card has been issued by the bank and ETN. PIN means personal identification number or password or any other form of electronic identification/signature issued by the bank and ETN to the Cardholder at the Cardholders request.

Transaction means information regarding the money or other relevant particulars relating to the cardholder, or the account or any other transaction; VAT means any value added tax, including any tax of a similar nature that means replace it or be levied in addition to it. ATM means Automated Teller Machine. POS means point of Sale terminals.

The Cardholder undertakes to pay the following charges and fees for the provision of the card PIN and Utility bills payment (if availed)

Taka 1500 annual fees for each card TAKA 200 for replacement of each lost, stolen, or damaged card TK 500 annual fee for card bill payments to the first 3 utility bills. TK. 100 annual fee per for any additional utility bill payments.

Closing of Bank Account : A customers account with a banker may be closed in the following circumstances:

The customer may inform the banker in writing of his intention to close the

account. The banker cannot ask for his/her reasons or such closer. It should immediately ask the customer to return the unsed cheque and close the account.

The may it self ask the customer to close his account when the banker

finds that the account has not been operated for a long time. A notice to that effect can be given to the customer. In case the customer is not traceable to amount standing to his credit may be transfereed to Unclaimed Deposit account. The amount shall be paid in the customer as the when he/she is traceable.

In case the banker finds that the customer is not desirable, e.g. customer

is found guilty of having forged cheques or bills of exchange etc. or flouting rules of operating the account, the banker may be notice in writing inform the customer of his intention to close the account. However, the banker should follow the following procedure in this connection

The banker should be given reasonable time to the customer for making alternative arrangement In case the customer does not come forward to close the account in spite of getting notice for closer of account from the banker, the banker should give the second notice to him starting clearly that in cease he himself does not close his account by specific date the banker himself will close the account.

In case the customer dose not closes the account by the specified date, the banker should issue a pay order/draft and send to him the money lying in his account.

In the following cases, the banker should suspend all payments from the customers account till the matters are finally settled.

When the banker receives notice of customers death or insanity

When the customer becomes insolvent or in case of a company, it goes into liquidation. In such cases money standing to the credit of the customer will be transferred to the official receiver or the official liquidator as the case may be.

When the banker receives notice from the customer regarding assignment to the balance standing to the credit of his account by him to a third party. The banker in such a case bound to pay to the third party.

CHAPTER 5
MoneyGram

INSIDE

BANK

HISTORY OF THE MONEYGRAM POLICIES MISSION OF THE MONEYGRAM POLICIES MONEYGRAM POLICIES AND PRODUCEDURES

Money Gram Section In National Crdit & Commerce Bank Ltd. Dhanmondi Branch Dhaka

Introduction
National Credit and Commerce Bank Limited is very happy to announce to have joined hands with MoneyGram Payment Systems Inc to serve expatriates to send money back home quickly from anywhere in the word. Moreover, Money can also be sent quickly from anywhere in the word. Moreover, money can also be send quickly through MoneyGram from Bangladesh to other parts of the World as is done through the banking channel. At the moment we are concentrating on home remittances being sent by the expatriates. MoneyGram Payment system Inc is a non-back provider of electronic money transfer service. Money Gram is providing its customers a service of an unsurpassed quality and superior value. MoneyGram has over 25,000 Agent locations throughout the world. Persons anywhere require transfererring cash quickly, reliably, conveniently and at atractive prices to more than 115 countries can depend MoneyGram agents for the service. Most countries have laws that imposes large fines and criminal penalties on anyone who knowing participants in many laundering. Money Grams anti-money laundering policies are based on U.S. laws, which are some of the strictest in the world. However, the country to which you operate may impose additional obligations if that in the case, you must also obey your own countries laws, too. Although we cannot be responsible for you and your own countries laws, too. Althouth we cannot be responsible to for you and your employees, compliance with anti-money laundering laws and regulations, we believe this guide can help you develop your own effective compliance program.

HISTORY OF THE MENEYGRAM POLICIES


MoneyGram, Originally a money-transfer service of American Express Company provides the expertise and reliability you expect from years of experience in the payment system industry. American Express Travel related Service Company launched a new consumer money-transfer service named MoneyGram in 1988. Until December 11, 1996 MoneyGram was a wholly-owned subsidiary of First Date Corporation. In 1996 MoneyGram was taken public and listed on the New York stock exchange. MoneyGram is now a part of Travelers Express Company, the USs largest money order company through a merger in end 1998. In March 1998 MoneyGram became fully licensed to provide money transfer service under its own name. MISSION OF THE MONEYGRAM POLICIES In our continuous commitment to serve the countrys economy in a better way we have made agreement with MoneyGram Payment Services Company to facilitate transfer flow money from abroad. The best benefit of the service can derived by our expatriates who are living in many countries of the world. The major problem being faced by our expatriated in many countries in not having bank accounts. Many banks do not entertain customers for remitting money without having accounts. Many banks to do not entertain customers for remitting money without having accounts. A big part of our expatriates income is channeled through clan desire means. Moreover many of our expatriates income is channeled through clandestine means. Moreover many of our expatriates cannot get acquireted with banking formalities immediately on reaching abroad. It is not necessary to have a bank account to use Money GramService. Our expatriates can visit any Money Gram agent when want to money, which gives very easy and convenient transfer. MoneyGram is represented in over 115 countires and is available at more then 25,000 locations worldwide. In the USA alone MoneyGram is available at more

than 15,000 locations. Besides in UK MoneyGram is available through 1700 Postal Branches and 500 Thomas Cook travelshops making it the UKs largest money transfer network. Finally using the MoneyGram Service could not be simpler. All one has to do is to visit a conveniently situated MoneyGram agent anywhere in the world and hand over the Money want to send their relatives or friends along with the one-off transacting fee. Sender completes a Send from and gets a Receipt. MoneyGram Agent gives a Ref. No. which has to be passed to be Receiver. Recipient the goes to NCC Bank Branch in Bangladesh. Fills out a Receive form and show proper identification. NCC Bank makers and inquiry on the MoneyGram computer network to obtain authorization to pay Recipient and Recipient receives the fund. MoneyGram is one of the fastest ways to transfer money. Customers using MoneyGram can send or receive money usually within 10 minutes from anywhere in the world. At NCC Bank we provide the Recipients immediate attention and due care. We have made it a point to pay the for the NCC Bank branches at his convenience for payment. We do not levy any extra charge. We give a better exchange rate to the Recipient. The Recipient convenience for payment. Recipient within minutes. The Recipients need not require having a bank account. We do not levy any extra charge. We give a better exchange rate to the Recipient. The Recipient can approach any. MONEYGRAM POLICIES AND PROCEDURES RECORDKEEPING REQUIREMENTS Money Transfer Send transactions:

For a money transfer of the equivalent of $3,000 US or more, you must obtain and record the following information name and address of the sender/customer. Full name and residence address of the sender/customer Customer date of birth Identification number and the type of the identification document used to verify the customers identify and the place of issuance of the identification document (e.g., passport number and country of issuance). You must verify that the identification document matches the customer conducting the transaction by consulting a government-issued document that contains of photograph of the sender, if vailable. Customers occupation Amount of the money transfer. Name of the receiver. Signed copy of the sender form.

For a money transfer less than the equivalent of $3,000 US, customer date of birth and occupation is not required by MoneyGram. For a send transaction less than the equivalent of #900 US, the senders photo identification need not be recorded. The send or receive form, MoneyGram computer screens or the operator at the MoneyGram call centre will guide in obtaining and recording the appropriate customer information based on the amount of the transaction, in either local currency or US dollars. You must also record whether the transaction is being conducted on behalf of another person, a business or company ( third party). If a third, party is involved in the transaction, record similar information about that third party is involved in the transaction, record similar information about that third party. Money Transfer Receive transaction: You must verify the identify of the receiver in the same way that you verify a senders identity and record the same information about the receiver. A receivers photo identification should always by reviewed at all transaction amounts although test questions are permitted in the most

countries up to equivalent of $900 US. The receivers photo identification details must be recorded at amounts of the equivalent of $900 US or more. Verification of Customers Identity: Before completing the money transfer, you must verify the identity of the individual by looking at a valid identification document, such as a drivers license, passport or other Government-issued photo identification that contains the customers name and address. The customer must be present in your location to conduct a transaction. Send and Receive Forms: By completing the from and back of send and receive forms you will have all of the required information. You must keep for at least five years forms related to transactions of $3,000 US and above. Forms for smaller amounts are to be retained for six months. The customer should always complete the customer section himself and should always sign the form. The customer copy of the form will serve as the customers receipt. You should always fill in the send transfer disclosure details on the front of the send form. Send Transaction approval Procedure: All money Gram send transaction greater than $20,000 US must be authorized through the Money Gram call center. For this transaction Money Gram Compliance personnel may interview the customer prior to authorizing the transaction for completion. To avoid misunderstandings, please advice your customer in advance that there may be a short delay in completing transaction of this amount because of the need for prior compliance approval. It must also be stressed that under no circumstances should you ever split up transaction (send multiple transactions rather one larger transaction) or order to avoid the compliance approval. These requirements are in place for protection of you and Money Gram. Transaction Limits:

Money Gram reserves the right to limits on the amount that customers may send. These limits may vary from time to time based on various security factors. The current daily limit per sender is the equivalent of $20.000 US (two $ 10,000 transactions). In addition, the limits in some countries may be less than Money Grams own limits due to specific laws in those countries. ACCEPTABLE CUSTOMERS IDENTIFICATION Photo identification: The laws of most countries indicate that acceptable customer identification for a financial transaction is a Government-issued, photo identification such as a national identity card, passport, local driving license, voter registration, national health card, alien identification, military identification, etc. Some countries have very specific requirements for legal dollar transactions. You must confirm that the identification document presented matches the customer conducting the transaction. You anti-money laundering program should include customer identification quidelines that meet both you countrys requirements and those of Money Gram. Know your customer: In order to prevent and detect criminal activity, all agents need to develop an awareness of their customer base. This should include the development of a Know Your Costomer program as part of your anti-money laundering program. Such a program will help you and your staffs identify suspicious activity, and can be an effective tool in the fight against money laundering and other criminal activity. STRUCTURING: MoneyGram launder are familiar with Money Gram transaction thresholds that require recordkeeping. Therefore, in order to remain anonymous and avoid their detection by law enforcement agents, they will structure their transaction so that the recordkeeping requirements of US $3,000 or reporting requirements of more than US $ 10,000 for currency transaction reports are not triggered. Structuring is the act of breaking up a potentially large transaction into several smaller ones.

In many countries, it is illegal for you or your customer to structure transactions in order to avoid recordkeeping or reporting requirements. For example, if a customer sends a $ 2000 transaction in the morning and another at the end of the day for $2000 to the same receiver, they may be structuring to be avoiding recordkeeping requirements. If you detected such activity, you should attempt to get full customer identification information, keep a record or file a report on the transaction (depending upon the amount involved) and consider filling a suspicious activity report with the Government, if required by your countrys laws. It may also to illegal for you and your employees to assist anyone in structuring transactions to avoid recordkeeping or reporting requirements. It is certainly against MoneyGram policy. For example, you may not tell or even imply to a customer that they can avoid providing information by conducting a smaller transaction. Some criminals may attempt to trick you or your employees into allowing them to structure transactions by splitting up transactions with several accomplices or by trying to con you with a hard-luck story. You need to on the lookout for structuring so that you can prevent it from occurring.

Money Transfer & Send Transactions Verification of Customer Indention Photo Identification

Money Transfer & Receive Transactions Know your Customer Send & Receive From Acceptable Customer Identification

Figure : MoneyGram Process

SUSPICIOUS ACTIVITY REPORTING


The laws of many countries require the reporting of suspicious activity to law enforcement officials. It is MoneyGram policy to report all suspicious activity to appropriate law enforcement officials and to require that Money Gram agents do likewise. Suspicious activity is a very difficult concept to define because can vary from one transaction to another, based upon all of the circumstances surrounding the transaction or group of transactions. For example, transactions by one customer may be normal and legitimate because of your knowledge of that customer, while similar transactions by another customer may be suspicious. Many factors are involved in determining whether transactions by are suspicious, including the amount, the location your customer, the customers behavior, etc. A good rule of follow is that if a transactions by are suspicious, including the amount, the location of your business, the customers reason for the transfer, comments made by your customer, the customers behavior, etc. A good rule of follow is that if a transaction is inconsistent with the business or personal circumstances of a customer and there is no reasonable explanation for the inconsistency, then it may be a suspicious transaction and should be reported. If we believe that some of your customers may be misusing our money transfer, our compliance staff may contact you as part of an internal investigation. You must not tell your customer about such no inquiry. You need to become familiar with the suspicious activity reporting requirement of your country, the forms required to be filled and any requirements to retain documentation so that you can ensure that your business is in compliance. Example of Suspicious Activity: The following list provides examples of potentially suspicious activity that should raise concern, require you learn more about the circumstance of the money transfer and may result in the reporting and suspicious such transactions, suspicious transactions should not be completed. This is only a list of examples. It is not a complete list.

Customers does multiple transactions in a single day. A customer appears to be structuring transactions in an attempt to avoid recordkeeping or reporting requirements. Two or more people, who are obviously together, each send transactions to the same person. An individual refuses to proceeds with a transaction once asked for identification or additional information. An individual attempts to threaten or bribe an employee or to corruptly influence and employee not to carry out any recrod recordkeeping or reportign requirement. A customer asks an employee how to avoid recordkeeping or reporting requirements. A customer provides unusal or suspicious identification documents that may have been altered or stolen or that do not fit the person presenting it. Never tell your customer that you are filling a suspicious activity report. In many countries, it is illegal for you to tell the customer that a suspicious activity report is being filed. PLEASE REMEMBER- this is not complete. It is mealy intended to give examples of situation that may be suspicious. You should be constantly alert and out for suspicious transactions. Trust your instincts. When in Doubt, it is best to use caution and refuse to conduct the transaction. ANTI-TERRIRIOSM Many countries have passed anti-terrorism legislation and have published lists of individuals believed to be involved in terrorism. Although the laws very from country to country, many require the reporting of property, such as the value of a MoneyGram transaction, to specified government authority. the Law may also require that

funds be blocked to prevent the release or refund of the funds without government approval. Although MoneyGram screen all names associated with MoneyGram

transactions using lists published by the United States and many country, you too may have specific responsibilities to comply with the laws of the country. PENALTIES Your government may have significant penalties for failure to comply with antimoney laundering reuirements, customer identification include large fines and/or imprisonment. Under certain circumstances, the government may hold business criminally liable for the act of their employees. It is important that your employees are trained in these matters. It is equally important that your business have a system that enables you to ensure that your employees are strictly complying with the laws and regulations. MoneyGram will also immediately cancel the contract of any agent who knowingly or negligently fails to comply with laws and regulations or Money Gram policies. requirements, recordkeeping and reporting requirements and anti-terrorism laws. Penalties may

CHAPTER 6
CREDIT APPRAISAL & CREDIT MANAGEMENT

INSIDE

BANK

PRINCIPLES OF THE GOOD LENDING PURPOSE & FUNCTION OF LENDING TYPES OF LOAN & ADVANCE LOAN SANCTION AUTHORITY SECTORAL DISTRIBUTION OF ADVANCE -2004 SELECTION OF BORROWER SELECTION & RECOVERY PROCEDURE LOAN CLASSIFICATION & PROVISIONING ORGANOGRAM OF CRDIT DIVISION

CREDIT APPRAISAL & CREDIT MANAGEMENT SYSTEM IN NATIONAL CREDIT & COMMERCE BANK LTD. DHANMONDI BRANCH DHAKA

Introduction
The prime assets of any financial institutions consist of its loan and advances and other investments. These assets are created primarily out of funds received from the depositors, loans and some other liabilities. The depositors as well as the investors in institution are interested in real value of the assets of the institution as often contradiction is unfolded between written value and realizable value of the assets. The creditors are interested as they want to know the depth of risk of their deposits, while the equity holders desire to be acquainted with viability of their source of income. the management of the institution as well as their supervising authority i.e. the Central Bank evaluates the assets of the institution keeping in view aforesaid aspects. Loan is one the prime sources of income of financial institution. The main function of a bank is to receive money and sanctions loans. Loan yields interest, which is the main source of income of a bank. The primary danger involved with loan or credit sanction is its regularity of repayment. This popularly known as credit risk or default risk. Excessive credit risk turns a loan as non-performing loan requiring for making provision, which become a burden for a bank. Advances are very important department for every bank. In this section, bank decides how they their fund and sources. According to prof. Hanson when a bank makes an advance to a customer whether by overdraft or loan account is called bank credit. According to Oxford dictionary of Business A specified sum of money lent by a bank to a customer, usually for a specified time at a specified rate of interest is called bank loan or bank advance. Banks make loans and advances to individuals, businessmen and industrialists. Moreover nature of credit may differ in terms of security requirement, disbursement provision, terms and conditions etc. Credit is continuous process. Major part of a banks income is derived from credit.

PRINCIPLES OF GOOD LENDING


It is fundamental precept of banking everywhere that advances are made to customers in reliance on his promise to repay, rather than the security held by the banker. Security is required buy the bankers as a protection against unexpected default in repayment by the customer. Thus, the object of both external and internal controls is to ensure the employment of bank funds is a profitable manner without under risk of loss to the capital. Though all loans contain some degree risk, and sound principles of credit must be employed in approving loans in order to keep the risk to a minimum. The principles of sound lending may, therefore, be summarized on safety, liquidity, purpose, profitability, security, dispersal/spread and national interest. Safety: Safety, first, is the guiding principle of a product banker. A bank is in business to make money. It mainly uses depositors fund as a means of its earnings, but safety should never be sacrificed for profitability. The money of the depositors being repayable on demand or, after a short notice, determines the capacity of banks as to period for which he can safety lend it out without an uncalculated risk. On principle be expected to come back in the normal course, i.e. the bank may not resort to legal action or to sell the securities to liquidate the advance. liquidity: The liquidity of an advance means repayment on demand on due or after a short notice. The loan must stand fair chances of payment according to the repayment schedule; otherwise, the liquidity position of the bank is endangered. Liquidity also signifies that the assets should be without any loss. Even in the case of fully secured advances, if it is feared from the very beginning that the advance would only be recovered by selling the securities, it is not considered a good advance. It must, therefore, always be ensured that the advance will be repaid from resource other than the securities pledged. A sizable portion of bank advances are,

therefore, granted to meet the working capital requirement of the borrower rather than to meet fixed capital requirement, i.e. construction of building or purchase of fixed assets. A banker would be failing in his duty to safeguard the interest of his depositors and shareholders if his credit policy does not provide a method of gradual repayment and final recovery of the money advanced. Purpose : A Banker would not throw away money for any purpose for which the borrower wants. The requirement of the borrower may be free all risk but the funds borrower is employed for unproductive purpose like marriage ceremony, pleasure trip etc, or speculative activities, the repayment in the normal course will become uncertain. Banks, therefore, discourage advance for hoarding stocks and refuse advances for speculative activities. Profitability: Banking is essentially a business, which aims at earning a good profit. The working funds of banks are collected mainly by means of deposits from the public and interest has to pay on these depots. They have also to meet their establishment charge and other expenses. Interested earned by a bank on its advances is the main sources of its income. The difference between the interests received on advance and the interest paid on deposits constitute a major portion of the bankers income. Besides, foreign exchange business is also highly remunerative. The bank will not enter into a transaction unless a fair return from it is assured. So, there is little point in a banker granting facilities, which do not bring directly or indirectly some return. Security: A banker would not normally like to recover the advance from the sale of the security. They would prefer an advance to come back from the normal source. The importance of an adequate and acceptable security can, however, be hardly over-emphasized. Security serves as a safety value for an unexpected emergency.

Dispersal/spread: The advances should be as a much broad based as possible and must be keeping with the deposit structure. The advances must not be in one particular direction or to one particular industry, because any adversity faced by the that particular industry w2ould have serious repercussions on the bank. Again, advances must note be granted in one area alone. There should be spread of advances against different securities, industries considerably improve the safety of his outstanding. National interest: Banking industrys significant role to play in the economic development of a country. The bankers would lend if the purpose of the advance is for overall internal development plans necessitating flow of credit to priority to sector in the larger national interest. Sometimes the need of the borrower may be considered so essential for the benefit of the national economy that retail trade, transport business, six small business and to render financial assistance to enterprising self-employed person, schemes are also formulated to finance them. as well as areas. Thus, by diversification of the advance a banker will be able spread his risks and

PURPOSE OF LENDING Bank can not afford a loan turning bad to the detriment of institution and the society and for this purpose, the sanctioning officer must be acquainted with principles of advance, and the ways and means to analyze the risk involved with the proposal processes and the limit sanctioned.

FUNCTION OF THE LOAN


National Credit and Commerce bank includes mainly two functions, that is 1. To take deposits. 2. To make advance.

Making of advances is the most important function of a Bank as upon it depends the probability of the bank, Moreover, Banks make advances out of deposits of the public which bare payable on demand. A commercial Bank makes advances to different sectors for different purpose i.e. financing of trade and commerce, imports and exports, industries; agriculture, transport, house-building etc. Advance by NCC Banks are made in different forms, such as-loans, Overdrats, Cash Credits.

TYPES OF LOANS & ADVANCES


There are two types of loans and advances. They are1. 2. Term loan. Continuous loan

Tern loans are for fixed time period. They dont have time extension facilities. On the other hand continuous loans are treated as advances and they are sanctioned for one year only and renewed for the each following year when it is expired. Depending on the various nature of financing, all the advances (lending) activities have been brought under the following major heads1. 2. 3. 4. 5. 6. 7. 8. Cash credit (CC) Secured Overdraft (SOD) Loans (General) House Building Loans ( Staff/General) Small Business Loans Personal Loans Loans Against Import Merchandise (LIM) Letter of trust receipt (LTR)

9. 10. 11. 12. 13.

Loans Against Packing Craft (PC) Inland Bills Purchased (IBP) Payment Against Documents (PAD) Foreign Documents Bills Purchased (FDBP) Local Documents Bills Purchased (LDBP)

CASH CREDIT: Cash Credit allowed against hypothecation of goods is known as Cash Credit (Hypothecation) limit. In case of hypothecation, the borrower retains the ownership & possession of goods on which charge of the lending bank is created. Holden says, Hypothecation is a legal transaction, whereby goods may be made available as security for a debit without transferring either the property or the possession to the lender. The documents, which creates charge of the lending bank on the hypothecated goods, is called letter of hypothecation. By signing this letter hypothecation, the borrower binds himself to give possession of the hypothecated goods to the lending Bank when called upon to do so. As the hypothecated goods remain under the possession of the borrower, such advances more or less clean.

As such, the banker should take the following precautions: 1. The Banker should carefully varify stocks of hypothecated goods and their market price. 2. Periodical statement of stock duly signed by the borrower should be obtained. 3. Stock should be duly insured against fire, burglary, R.S.D with bank clause. 4. Banker should be trustworthy & prudent customer. 5. The goods are readily saleable and good demand in the market. 6. The price of the goods, offered as security, is to be calculated as per following priciple- purchase price or market price whichever is lower. 7. The prices of the goods are steady. Cash Credit (Pledge): Cash Credit allowed against pleadge of goods is known as Cash Credit (pledge) limit. In case of Cash Credit (pledge) the borrower pledges his goods to the banker as a security against the credit facility; pledge has been defined as a bailment of goods as security for the payment of the debt or performance of promise. The ownership of the pledge goods remains with the pledged. Banks retain the effective control of the pledge goods. Pledge goods may be stored in godown of the borrower but under lock & key of the bank. Banks guards are posted round the clock to protect the godown. Sometimes, pledge goods are stored in Banks godown. Bank makes delivery of the pledge goods to the party against (pledge) limit. 1. 2. The quantity of the goods is ascertained. To goods are readily salable and have a constant & effective demand in the market payment.

Following points should be taken into consideration while allowing Cash Credit

3. 4. 5. 6. 7.

The quality of the goods in ensured. The goods are not perishable and will not deteriorate in quality as a result long or duration. Goods are stored in pucca godown to save them from deterioration and to guard them against risk of pilferage. The borrower has an absolute title to the goods. The price of the goods should be steady and are not subject to violent changes. The valuation of the goods should be made very careflly. Purschase price or market price whichever is lower-is the general principle for assessing the valuation of the goods.

8. 9. 10.

The goods are insured against all risk, such as fire, theft etc. and the insurance policy bears Bank Mortgage Clause. The stock report is obtained duly signed by the borrower. The locks of the godown are sealed and keys are deposited in the branch.

Drawing Power: Both a cases of hypothecation & pledge, the banker should find out the Drawing power. Advance is allowed against hypothecation/pledge of goods after deduction of the margin. If the margin for advance against stock of Cotton Yarm is 30% then can advances tk. 70/- against hypothecation/ pledge of stock of Cotton Yarn of tk. 100/-. In this case tk. 70/- against hypothecation/pledge of stock of Cotton Yam of tk. 100/-. In this case tk. 70/- is the drawing power. A Banker should know the market price of the goods to arrive at a correct D.P. Secured Overdraft (SOD-FO&G): In case of secured overdraft (FO) the number is start from 12.. in the bank. Advances allowed to the individuals or firms against their financial obligations. Customers take SOD facility under lien of FDR, PSR etc. This may or may not be a continuous credit. In case of Secured overdraft (G) the number is start from 14.... in the bank. Advances also allowed against assignment of work order for execution of

contractual works. It is generally allowed for a definite period and for specific purpose. It is not a continuous credit. LOAN (GENERAL) Short term, Medium term & long term loans allowed to individual/firm/industries for a specific purpose but for a definite period and generally repayable by installments fall under this head. HOUSING LOAN SCHEME: Recognizing housing problems in urban areas, especially Dhaka, Narayangonj, Chittagong, and other divisional head quarters are acqute. Construction of buildings is not progressing as expected because of scarcity of housing loans. Many people of different professions, who have to capacity to construct/ purchase house/flat but have scope to repay the cost of the same from their earnings, provided they are facilitated with the sanction of institution loans, with a view to creating financial capability of the prospective clients in purchasing flats/houses and in constructing houses and with the objective of exploring a profitable investment area introduces. Purpose: To help service holders, self employed persons, businessmen, professional and also those who have the capability to repay loan for purchase of flat/house/construct buildings and thereby improve their quality of life. the country. To help the prospective clients get housing loans on easy To strengthen the banks lending base. To increase profitability of the bank. To contribute towards improvement of socio economic terms and without any handles. To contribute to the reduction of acute housing problems of NCC Bank Housing Loan scheme has been

condition of the society.

Target group: People of all sections of the society who are desirous of purchasing flats/ house/constructing buildings/ flats on land owned though registered purchase/lease from the Government/any other government approved authority and who have the capacity to repay the loans within the validity period of the loan out of the income generated by the flats/houses and also their other sources of income, may be ideal customers. House Repairing & Renovation Loan: The scheme is meant for the genuine house/building/flat owners to undertake repairing/ renovation works for better living or to improve the standard of living of the people for increasing rental income. House building loan (Staff): Loans allowed to the bank employees for purchase/construction of house shall be known as Staff Loan (HBL). House building loan (General): Loans allowed to individual! Enterprises for construction of house (residential or commercial) fall under this type of advance. The amount is repayable by monthly installment within a specified period. Such advances are known as loan (HBL). SMALL BUSINESS LOAN: It has observed that small business enterprise generally cannot provide collateral securities to avail loan facilities. Genuine business having entrepreneurship quality and honesty will come under the preview of this scheme.

CHAPTER 7
CUSTOMER RELATIONSHIP

INSIDE

BANK

BANKER- CUSTOMERS RELATIONSHIP PROCESS DEPOSIT MIX-2004

CUSTOMER RELATIONSHIP WITH NATIONAL CREDIT & COMMERCE BANK LTD. DHANMONDI BRANCH DHAKA.

Introduction
The nature of relationship between a banker and a customer depends upon the type of services rendered by the banker. Before discussing about the relationship between the banker and the customer. Definition of a banker: A Banker includes a person or Corporation or Company acting as Bankers - Negotiable Instruments Act. 1881 (Sec-3) Under Section-5 of Banking Companies Act. 1991 the term banking has been defined the public, repayable on demand or otherwise and withdrawal by cheque, draft, order or otherwise. According to this definition, acceptance of deposit of money from the public for the purpose of lending and investment is the principal and primary function of a banker who may undertake and perform other subsidiary functions as authoried under Article 7 of the Banking Companies Act., 1991. National Credit and Commerce Bank Limited is manned by well qualified and experienced officials, always prepared to provide efficient, personalized and quality service backed by state-of-the-art technology for both customers and for internal use. The banks prime objective is to provide high quality product and services to the customers. The bank also performs according to the needs of its corporate clients and provides a comprehensive range of financial services to national and multinational companies.

BANKER-CUTOMER RELATIONSHIP
The banker-customer relationship depends upon the nature of transaction. This relationship is totally reciprocal/inter-changeable. The relationship depends on trust and its sometime also risky. If one party breaches the trust then the other party causes loss for the breach. Some relationships between banker (NCCBL), and customer are illustrated below: The primary relationship is the contractual one. The accounts of the customers form the basis of such contract and the relationship appears in different forms according to the type of contract. After opening an account the bank accept the deposit of the customer and undertakes to refund money on demand on the basis of contractual relationship. This relationship is entered into as soon as the account of the customer is opened with the bank. With the deposit of customers money in the bank for safe custody the customers becomes its creditor and bank becomes debtors and the opposite happens when a customer borrows money from the Bank. However, the relationship between a banker & customer is not exactly like that of an ordinary and creditor. National Credit and Commerce Bank services their customer through different types of deposit such as:

CHAPTER 8
BANKS PERFORMANCE

INSIDE

BANK
FINANCIAL HIGHLIGHTS (2000-2004) RESERVE FUND AND OTHER RESERVES POSITION OF INVESTMENT & ADVANCES OPERATIONAL PROFIT OF MARKET LIQUIDITY STATEMENT (AS AT 31 DEC. 2004) FINANCIAL STATEMENT (BORRWOING FROM OTHER BANKS) NOTES OF THE FINANCE STATEMENT ADITORS REPORT TO THE SHAREHOLDERS BANKING RISK EXPOSURE

PERFORMANCE OF NATIONAL CREDIT & COMMERCE BANK LTD. DHANMONDI BRANCH DHAKA.

Introduction
National Credit and Commerce Bank Limited has diversified activities in retail banking, corporate banking and international trade. Successful companies today are fully aware that they need to be able to rely on the services of a bank that can handle international trade with a good hand. Ever since its conversion into a full-fledged bank at 17th MAY, NCC bank has been an accomplished Trade Finance bank. With a highly professional team experienced and competent professionals we are able to provide a wide range services to companies engaged in international trade. NCC Bank has also positioned itself as an established Correspondent Bank. Through a worldwide network of 260 correspondent banks NCC Bank is present in all key areas of the globe. The institution started its function back in 1985 as an investment company in the name & style of National Credit Ltd. Paid-up capital of the company was tk. 5.00 crore only at that time. NCCBL performed well for near about 20 years. The crore objective of the company was to play catalyst role in the capital market of the country by way of participating in security trading, underwriting ect. The Bank could sustain its strong image in the mind of the customers and shareholders as a lending financial institution despite serious competition in from both local and foreign Banks operating in the country. Main share holders in this bank comprise leading industrialist and business magnets of the country. The board of directors consists of 26 members. Most of the directors are owners of large of business groups having high net worth. Due to the predecessor companys involvement investment financing sector of the country the bank inherited its top corporate customers. Moreover the bank is involved in import trade financing. Bulk importers of consumer durable, food grains industrial raw materials are its customers. The bank has financed in textile and apparels sectors.The bank has a trend of choosing customers from diversified groups. The bank has first class customers in the construction sectors involved in high rise building, heavy construction. construction and roads and high way

The Progress of NCCBL at a glance:


NATIONAL CREDIT AND COMMERCE BANK LIMITED Performance of the Bank at a Glance FINANCIAL HIGHLIGHTS
Authorized Capital Paid up Capital Reserve fund & other Reserve Equity fund Deposits Loans & Advances Investment Import Business Export Business Opening Income Opening Profit Profit after tax Retained profit Total Assets (excluding contra) Fixed Assets Number of Branches Number of employees Earning per Share Dividend : Cash (%) Bonus (%) Return on assets (ROE) (%) Capital Adequacy Radio Non performing Loans as % of Total Advance Volume of Non-performing Loans Amount of provision against Classfied Loans Amount of provision against Unclassified Loans Advance/ Deposit Ratio 2000 750.00 390.00 257.32 693.24 10,557.72 7,965.14 1,722.01 13,534.00 4214.00 1,374.61 945.38 429.23 181.02 100.79 6.91 12,428.16 242.60 27 691 25.84 10.84 10.00 10.00 0.81 8.01 10.68 665.11 410.13 70.00 0.75:1 2001 750.00 429.00 353.58 809.08 12,848.71 10,788.61 1,756.89 13,754.00 4,504.00 1,780.15 1,211.50 568.65 351.36 232.28 6.20 16.091.24 257.28 29 739 54.14 18.00 12.00 38.71 1.44 8.03 9.89 10.67.06 446.91 96.68 0.82:1 2002 750.00 480.48 388.48 1,037.73 16,062.35 13,147.72 2,909.15 13579.50 4,559.00 2050.15 1459.65 597.50 385.38 213.68 1.41 18,684.19 267.76 31 857 44.47 15.00 20.59 1.14 8.01 9.39 1,234.14 633.75 118.34 0.82:1 2003 750.00 552.55 552.55 1063.28 14,673.42 12,850.85 2,966.02 13,089.94 4,967.33 2,262.86 1,637.92 624.94 334.60 79.12 1.54 17,439.93 300.41 32 896 30.99 10.00 10.00 16.10 0.95 9.01 9.75 1,253.35 733.86 118.34 0.88:1 2004 750.00 607.81 607.81 1,368.99 16,069.23 15,211.15 4,385.23 13,274.08 5771.65 2283.37 1562.88 720.49 445.50 285.16 14.28 21,469.02 297.22 36 925 46.91 30.00 20.83 1.33 9.05 7.87 1,188.40 650.06 138.90 0.95:1

Reserve Fund & Other Reserves


The Reserve fund of the Bank increased to tk. 421.02 million in 2004 as against tk. 410.00 million of previous year, increased being 9.95%. This year figure excludes tk. 65 million of Share Fluctuation Reserve. Total Assets, Fixed Assets & Depreciation: 2500 2000 1500 1000 500 0 Series1

2000

2001

2002

2003 `2004

Figure: Movement of the total assets { in million} in different year. Fixed assets and depreciations: But o depreciation has been charged on land structure.
Items of fixed assets Land and Structure Furniture and fixtures Equipment and machinery Vehicles Rate of Depreciation

Depreciation at applicable rates is charged on additions is fixed assets as well as on sale of any item on the basis of number of day in use of the concerned asset.

Deposit Growth :

2500

2000

1500 Depos its G rowth 1000

500

0 2000 2001 2002 2003 `2004

Figure : Deposit Growth ( in million) in different year Deposit of the Bank at end of the year was tk. 16,000.00 million registering an increasing of 20.05% over previous year figure, which was tk. 14,897.00 million. A number of welfare oriented Deposit Schemes introduced by the Bank received tremendous response from the small depositors.

Position of the Investment & Advances Investment:

Figure: Investment (in million) movement in different year.

The volume of investment as on 31st December 2004 was tk. 4,385.23 million which was tk. 2,Govt. Treasure Bond considering it as good in respect of rate of return. In this way Bank could utilize excess liquid fund resulted from reduction of liquidity requirement by Bangladesh Bank.

Distribution of Investment Portfolio 2004

Advance Growth:

Figure: Advance Growth (in million} in different year To ensure optimum utilization of resources, the bank continues to extend credit facilities after thorough evaluation and analysis of the risk factors involved. In December 31, 2003 the loan & advances was Tk 12, 987.90 million & 2004 was Tk. 15,211.15 million. The deposit advance ratio was 0.95.01 in 2004. The bank provides credit for trade & business, import, export, leather, real estate, and rural loan programs. NCCBL is pledged bound for over all infrastructure development for facilitating export & development of import substitute industries in the country. In the light of such commitment the bank provides loans & advances.

Funded and Contingent Assets 2004

Operational Profit of Market

The brokerage house established by the established by the bank in 2004 with all modern facilities attracted the traders and clients remarkably and the house could earn good business during the year under review. Considering the present trend of share market, we believe that income through Brokerage House will increase manifold in future. The oerational profit of the Bank during the year 2004 was tk. 720.94 million in 2003; rate of growth being 16% Return on assets (ROA) was 1.33%. Required provisions have been made for tk. 292.53 million out of operational profit on a/c of Nonperfming/ Bad loans. Net profit thus came to tk. 44.55 million.

CHAPTER 9
CONCLUSION PART

INSIDE

BANK

CONCLUSION

Conclusion:
The internship program is one of the compulsory for Bachelor of Business Administration (B.B.A). I had already completed my internship program from National Credit and Commerce Bank Limited on the topics of overall banking system and made a report on this topic. I tried my best to collect significant date and analyzed them in the topic. I hope that this report would be able to show a meaningful of the overall banking policy and I also hope earnestly that an entrepreneur can take help from this report. Proper financial system of a country can contribute towards the development of that countries economy. In our country Bangladesh, banks have a lending power to its financial system. For this reason, the banks should have a potential role to make our financial system. In this reason, the banks should have a potential role to make our financial system. For this reason, the banks have a potential role to make our financial system. In this area, private commercial banks are playing a vital role in the development in this area, private commercial banks are playing a vital role in the development of our economy. But Govt. and Bangladesh Bank play a crucial role to the private commercial banks through imposition of deposit restriction, lending role and other banking operations in recent years of banking business, National Credit and Commerce Bank Limited has shown better performance comparing with other first generation banks. We expect the National Credit and Commerce Bank Limited may hold its prospect in future and can contribute a vital in the socio-economic prospective.

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