Executive Summary

Banking sector is considered as the barometer of national economy. The Islami Bank Bangladesh
Limited was established in 1983 with a view to develop economic and social programs of
Bangladesh by rein foreign investment assisting in financing and promoting economic and
social welfare of !"slim comm"nity IBBL has la"nched several programs in banking based on
Islami #haria.
The business performance of IBBL with respect to its commitment c"m"lative commitment
loan disb"rsement and implementation of pro$ects lease financing investors acco"nt and
recovery and rehabilitation activities have been analy%ed. In the report the financial performance
of IBBL is analy%ed thro"gh disc"ssing total income total e&pense net profit dividend
appropriation of total profit grand total profit etc.
The findings of this report is that Islam Bank Bangladesh Limited has been growing faster and
better the average of the banking sector in terms of deposits loans and advances and e&pansion.
Islami Bank Bangladesh limited is pioneer of Islami #hariah banking in Bangladesh. The bank's
growth rate in terms of deposits as well as loans and advances are better than the average rates
of private banks.
!oreover its market share in the private banking sector in terms of deposit and loans and
advances are increasing day by day. (nother important factor is that the earnings of IBBL in
relation to e)"ity loans and advances and assets are more than the average ratios of private
banks especially when the bank is compared with the *8 banks established before +,,+. Islami
Bank activities are vast and elaborated b"t my st"dy is concentrated mainly in the -eneral
Banking (ctivities.
Based on the s"mmary followings recommendations can be offered.
IBBL needs to improve its most earning assets to increase its earnings. It sho"ld take vario"s
attractive schemes in this regard.
It has to ens"re "niformity in branch performance. /or this p"rpose vario"s training programs
and workshops sho"ld be la"nched.
Islami Banks Investment in agric"lt"re and r"ral sector is low compare of other sectors. It
sho"ld give emphasis to promote agro0based ind"stry.
IBBL has to start e&tensive on line banking in order to keep pace with +1 cent"ry's challenge.
/"ll comp"teri%ation of all activities of IBBL sho"ld be introd"ced.
Chapter-1
Introduction
1.1. rigin of the !eport"
(ct"ally this Internship report is s"bmitted as a partial f"lfillment of the re)"irement of
Bachelor of B"siness (dministration.The work presented in this report titled 1-eneral Banking
(ctivities of IBBL2 3anthapath Branch. I have learnt some val"able information abo"t over all
general banking of IBBL. I believe it will help me in f"t"re. I believe this report will be "sed as a
benchmark of f"t"re f"rther research activities.
1.#. Scope of Study"
This report mainly emphasi%es in general banking activities of IBBL. 4owever the report also
cover brief overview of IBBL its prod"cts services operating activities financial position
3erformance analysis and #56T analysis of IBBL.
1.$. b%ective"
To analy%e the general banking activities of IBBL
To st"dy the performance of the bank with special emphasis on -eneral Banking
To analy%e the prod"ct and services of IBBL
To find o"t the problem of IBBL in respect to general banking activities
To offer recommendation for f"rther development of IBBL
1.&. 'ethodology of the study"
7ata #o"rces.
The information and data for this report have been collected from both the primary and
secondary so"rces.
8 3rimary so"rces.
/ace to face conversation with the respective officers and st"ffs of the branch and IBT9(.
/ace to face conversation with clients visited the branch.
3ractical work e&perience in the different desk of the department of the branch covered.
9elevant field st"dy as provided by the officer concern.
8 #econdary so"rces.
1. 7aily diary :containing my activities of practical orientation in IBBL;
+. <ario"s p"blications on bank
3. 5ebsite of IBBL ltd.
*. 5ebsite of Bangladesh bank
=. (nn"al report of the bank
>. 3ersonal investigation with bankers.
?. 7ifferent proced"re man"al p"blished by IBBL.
1.=. Limitations.
This st"dy for a short period of time is not free from limitations. (ct"ally this st"dy does not
show the total banking practice of private banks since few departments were e&cl"ded from
observation d"e to time constraint. The ma$or limitations that st"dy the st"dy faced d"ring the
st"dy period are spotlighted below.
8 The officials have some times been "nable to provide information beca"se of their h"ge ro"tine
work.
8 #ome data co"ld not been collected for confidentiality or secrecy of the management.
Chapter-#
Company (rofile
#.1. Background"
Banking sector plays a dynamic role for the development of national economy. It works as
intermediary between depositors and borrowers. (t present there are *8 banks in Bangladesh.
Islami bank is one of the top ranking banks in Bangladesh. The ob$ective of Islamic banking is
not only to earn profit b"t to do good and welfare to the people Islam "pholds the concept that
money income and property belong to (llah and wealth is to be "sed for the good of the society.
Islamic Banks operate on Islamic principles of profit and loss sharing strictly avoiding interest
which is the root of all e&ploitation and is responsible for large scale inflation and
"nemployment.
(n Islamic Bank is committed to do away with disparity and establish in the economy trade
commerce and ind"stry b"ild socioeconomic infrastr"ct"re and create employment opport"nities.
#.#. )istorical Background"
In the early period of Islam the financial transactions of that time is not as like as today. (s s"ch
the very word' banking' was not "sed in that period. B"t all the transactions in early period of
Islam had been completed witho"t resorting to interest. The !"slim world has been in a state of
degeneration for a n"mber of cent"ries. The social breakdown and weakness bro"ght abo"t by
this degeneration paved the way for foreign domination which led to f"rther disintegration and
decline.
This decline is reflected in all aspects of !"slim life and has been accompanied by poverty
reflected in all aspects of income and wealth socio0economic in$"stice social disharmony and
loss of creativity. @evertheless the "ndeniable fact is that the !"slim masses are intensely
attached to Islam all over the !"slim world and sincerely crave for its revival and s"premacy.
The intelligentsia has been always for interest0fee economy.
B"t political s"b$"gation defeated them for long to s"cc"mb to interest0based economic system.
4owever the str"ggle for restoration b"t the early period of the present cent"ry received as good
manifestation for the ca"se of Islamic banking that is the Islamic economic system.
The first attempt to establish an Islamic financial instit"tion took in 3akistan in the 19=,s. it was
a local Islamic Bank in a r"ral area of erstwhile 3akistan :5ilson 1983; it was an e&periment
initiated by some pio"s landlords. They deposited f"nd at no interest on the credit advanced b"t
they had to pay a small service chare to cover the banks operational e&pense. The chare was
lower than the fate of interest.
(ltho"gh the e&perience was enco"raging b"t two main factors were responsible for its fail"re.
/irst the deposits made were regarded by depositors :landlords; as once and for all deposits. 5ith
the increasing n"mber of borrowers the gap between capital available and credit demanded was
h"ge. #econd the bank staff did not have complete a"tonomy over the bank's operations and
depositors showed considerable interest in the way their money was lent o"t :5ilson 1983;.
The second attempt began in Agypt in 19>3. it was established in a r"ral area of @ile 7elta and
was called !itt -hamr #aving Bank. This attempt may be called the first modern e&periment
with Islamic Banking witho"t pro$ecting an Islamic image for fear of being seen as
manifestation o Islamic f"ndamentalism which was anathema to the political regime. The
pioneering effort led by (hmed AI @a$$ar took the form of saving's bank based on profit sharing
in the Agyptian town of !it -hamr in 19>3. This e&periment lasted "ntil 19>? :9eady 1981; by
that there were nine s"ch banks in the co"ntry. These banks which neither charged nor paid
interest invested mostly by engaging in trade and ind"stry directly or in partnership with others
and shared the profits with their deposits :#iddi)i 1988;.
Th"s they f"nction essentially as saving investment instit"tions rather than as commercial banks.
The e&periment s"ffered by owing to changes the political atmosphere. @evertheless the pro$ect
revived in 19?1 "nder the name of @asier #ocial Bank.
The @asir #ocial Bank was declared an interest0fee commercial bank altho"gh its charter made
no reference to Islam or #hariah :Islamic Law;. The bank offered a f"ll range or normal banking
services and wide range of investment activities thro"gh e)"ity participation :(shker0198?;.
Islamic Banking made its deb"t in !alaysia in 1983 b"t not witho"t antecedents. The first
Islamic financial instit"tion in !alaysia was the !"slim 3ilgrims #avings Borporation set in
19>3 to help people save for performing ha$$. The reason for the establishment of this instit"tion
was the contention of the !alaysian !"slims that money spent on pilgrimage m"st be clean and
"ntainted with 9iba. #ince this was not possible by p"tting money with the ordinary banks. (nd
as s"ch this desire led to the establishment of a special financial instit"tion.
In 19>9 this body evolved into the 3ilgrims !anagement and f"nd Board or the Tab"ng 4a$$ as
it is now pop"larly known. The Tab"ng 4a$$ has been acting as a finance company that invests
the savings of wo"ld be pilgrims in accordance with #hariah b"t its role is rather limited as it is
a non0bank financial instit"tion.
The s"ccess of the Tab"ng 4a$$ however provided the main impet"o"s for establishing Bank
Islam !alaysia Berhad :BI!B; which represents a f"ll fledged Islamic commercial bank in
!alaysia. The Tab"ng 4a$$ also contrib"tes 1+.8 percent of BI!B's initial capital of !C8,
million. BI!B has a complement of fo"rteen branches in several parts of the co"ntry.
( significant development in Islamic Banking took place when a license for an Islamic Bank was
iss"ed by the #a"di (rabian government to the fifty0year old 1(L09a$hi Banking Investment
Borporation2 and has since developed active relationships with ma$or man"fact"ring and trading
companies in A"rope and several D# corporations.
Islamic 7evelopment Bank :I7B; was fo"nded in 19?= as a m"ltinational financial instr"ction
by the several !"slim co"ntries. The p"rpose of this bank is to s"pport social and economic
development in !"slim nations within an Islamic framework. The s"bscribers of the capital are
the fo"nder governments and as s"ch it was established on government treaty.
'ore seven Islamic Bank and /inancial instit"tions had been established within three years of
establishment of I7B. These were :a; 7"bai Islamic Bank :b; E"wait /inance ho"se E"wait :c;
/aisal Islamic Bank Agypt F :f; Islamic 7evelopment Bo. #ariah.
#.$. Starting of IBB*"
In ("g"st 19?* Bangladesh signed the Bharter of Islamic 7evelopment Bank and committed
itself to reorgani%e it economic and financial system as per Islamic #hariah.
In Gan"ary 1981 Late president Hia0"r 9ahman while addressing the 3rd Islamic #"mmit
Bonference held at !akkah and Taif s"ggested 1The Islamic co"ntries sho"ld develop a separate
banking system of there own in order to facilities their trade and commerce2.
This statement of Late 3resident Hia0"r 9ahman indirect favorable attit"de of the -overnment of
the people's rep"blic of Bangladesh toward establishing Islamic Bank and financial instit"tions
in the co"ntry.
In @ovember 198, a delegation of I7B visited Bangladesh and showed keen interest to
participate in establishing a $oint vent"re Islamic Bank in the private sector. Two professional
bodies' Islamic research B"rea"s :IA9B; and Bangladesh Islamic Banker's (ssociation :BIB(;
made significant contrib"tion towards introd"ction of Islamic Banking in the co"ntry.
(t last the long drown str"ggle to establish and Islamic Bank in Bangladesh became a reality
and Islamic Bank Bangladesh was establish in !arch 1983 in which 19 Bangladeshi @ational *
Bangladeshi instit"tions and 1 banks financial instit"tions and -overnments bodies of the
middle Aast and A"rope incl"ding I7B and two eminent personalities of the Eingdoms of #a"di
(rabia $oined hand to make the ream into a reality. Later other three Islamic Banks were
established in the co"ntry.
#.&. Characteristics of an Islamic Bank"
1. It is a financial instit"tion.
+. It is a b"siness instit"tion.
3. It operates its b"siness activities free from interest.
*. It is r"n according to r"les and reg"lations formed and amended by #hariah Bo"ncil.
=. It is profit0loss sharing b"siness organi%ation.
>. It provides loan as I"ard 4asana for social welfare.
?. It gives Hakat on its capital according to Islamic #hariah.
8. It leads all of its transaction according to Islamic law.
9. @o form of work is done which is non0Islamic etc.
1,. Islamic Bank means not b"siness prod"ct b"t r"nning b"siness thro"gh money.
#.+. ,ecessity of Islami Bank"
Islamic banking is not only to earn profit b"t also to make welfare to the people. Islam "pholds
the concept that money income and property belong to (llah and this wealth is to be "sed for the
good of the society. Islamic banks operate of Islamic principles of profit and loss sharing strictly
avoiding interest which is the root of all e&ploitation and is responsible for large0scale inflation
and "nemployment. Islamic bank is committed to abolish s"ch disparity and establish $"stice in
the economy trade commerce and ind"stry b"ild socio0economy infrastr"ct"re and create
employment opport"nities.
#.-. 'ission of the Bank"
To established Islamic banking thro"gh the introd"ction of a welfare oriented banking system
and also ens"re e)"ity and $"stice in the field of all economic activities achieve balanced growth
and e)"itable development thro"gh diversified investment operations partic"larly in the priority
sectors and less development areas of the co"ntry. To enco"rage socio0economic development
and financial services to the low income comm"nity partic"larly in the r"ral areas0
#... /ision of the Bank"
The Bank's vision is to always strive to achieve s"perior financial performance be considered a
leading Islamic Bank rep"tation and performance.
The Bank's goal is to establish and maintain the modern banking techni)"es to ens"re the
so"ndness and development of the financial system based on Islamic principles and to become
the strong and efficient organi%ation with highly motivated professionals working for the benefit
of people based "pon acco"ntability transparency and integrity in order to ens"re the stability of
financial systems.
The Bank will try to enco"rage savings in the form of direct investment.
The Bank wo"ld also try to enco"rage investment partic"larly in pro$ects which are more likely
to lead to higher employment.
#.0. b%ectives of the Bank"
8 Ans"ring $"stice to both s"ppliers of f"nd :depositors; and "ser of f"nd :investment takers;.
8 To cond"ct interest0free banking.
8 To establish participatory banking instead of banking on debtor creditor relationship.
8 To invest thro"gh different modes permitted "nder Islamic shariah.
8 To accept deposits on profit J loss sharing basis.
8 To establish a welfare0oriented banking system.
8 To e&tend co0operation to the poor the helpless and the low0income gro"p for their economic
development.
8 To play a vital role in h"man development and employment generation.
8 To contrib"te towards balanced growth and development of the co"ntry thro"gh investment
operations partic"larly in the less developed areas. To contrib"te in achieving the "ltimate goal of
Islamic economic system.
+.9. #tr"ct"re of the 6rgani%ation.
+.1,. Borporate information.
8 7ate of opening 3anthapath branch. +?0,*0+,,8
1. 7ate of incorporation. 13.,3.83
+. 7ate of receiving Banking license. +8.,3.83
3. 7ate of incorporation of first branch :Local office 7haka;. 3,.,3.83
*. /ormal ina"g"rating. 1+.,8.83
=. Hone. 1,
>. ("thori%ed capital. =,,, million
?. #hare of capital.
a; Local0share holders. =?.3>K
b; /oreign share holders. *+.>*K.
8. 3aid0"p capital. 38,1.>, million
9. A)"ity :31.1+.+,,3;. 18+=,.+> million
1,. Branches. 19>
11. 7eposit. 1?3+1,.?, million
1+. Invest. 183813.+= million
13. /oreign A&change B"siness. 111,=9.,, million
1*. @"mber of employee. 8=81
1=. #hareholder. +>*88
+.11. /"nctions of the IBBL.
To maintain all types of deposit acco"nts.
To make investment.
To cond"ct foreign e&change b"siness.
To e&tent other banking services.
To cond"ct social welfare activities thro"gh Islamic Bank /o"ndation.
+.1+. #etting performance of ob$ectives.
8 To e&tend the benefits of the investment of the investment of the bank "nder the scheme to
different sections of the people.
8 To assist in solving the e&isting ho"sing problem of the co"ntry.
8 To assist the service holders and professionals with fi&ed income to arrange for ho"ses of their
own.
8 To e&tend investment facilities of the bank to every nook and corner of the co"ntry by si%e of
investment by sector of investment and on the basis of geographical area.
8 To make investment facilities easily available "nder Islamic #hariah to those people who do not
want to avail investment facilities from interest based financial instit"tions.
+.13. 7isting"ishing feat"res of IBBL.
The disting"ishing feat"res of IBBL are.
(ll activities are cond"cted on interest0free system according to Islamic #hariah principles.
Investment is made thro"gh different modes as per Islamic #hariah.
Investment J income of the bank is #hared with the !"daraba depositors according to an
agreed "pon ratio ens"ring a reasonable fair rate of ret"rn on their deposits.
(ims to introd"ce a welfare0oriented banking system and also establish e)"ity and $"stice in
the field of all economic operations.
A&tend socio0economic and financial services to individ"als of all economic backgro"nds with
strong commitment in r"ral "plift.
3lays a vital role in h"man reso"rce development and employment generation partic"larly
among the "nemployed yo"ths.
3ortfolio of investment and investment policy have been specially tailored achieve balanced
growth F e)"itable development thro"gh diversified investment operations partic"larly in the
priority in sectors and in the less developed areas of the national economy.
+.1*. Islami Banking in Bangladesh.
(lmighty (llah has strictly forbidden investing or earning on the basis of interest :riba; beca"se
interest :riba; is o"t and o"t prohibited in Islamic r"les. #o every sorts of transition m"st be free
from riba. B"t not only in Bangladesh b"t also over the world all the banks are working based on
interest.
(s it is haram in Islam the !"slim scholars tho"ght a plan to establish a banking system that is
free from interest and will work in the basis of profit0loss shearing. Then depending on this
tho"ght it is decided to establish Islamic banks thro"gh the whole world to protect every one
from this c"rse.
+.1=. 3rod"cts and services of IBBL.
(; (l0 5adeeah B"rrent (cco"nt. 7epositing for the p"rpose of "sing.
B; !"daraba savings acco"nt. The term 1!"daraba2 means partnership. Blient provides money
F Bank involves with management. 3rofit is apportioned as per 3re (greed ratio. @at"ral loss is
borne by the client.
B; !"daraba term 7eposit (cco"nt. 3L>L1+L+*L3> months.
7; !"daraba #pecial @otice (cco"nt.
A; !"daraba 4a$$ #avings acco"nt. :a special acco"nt to facilitate performance of pilgrimage by
fi&ed income gro"p;. 1 to += years term.
/; !"daraba #pecial #avings :pension; acco"nt. = years F 1, years term.
-; !"daraba #avings Bond #cheme. = years F 8 years term.
4; !"daraba /oreign B"rrency 7eposit (cco"nt.
I; !"daraba !onthly 3rofit 7eposit (cco"nt.
G; !"daraba m"hor :7owry; #avings (cco"nt.
E; !"daraba 5a)f Bash 7eposit (cco"nt. 7eposit taken for the p"blic welfare from the well0off
and the rich people of the society.
#.1-. )uman !esources 1evelopment"
Amployees of the branches.
3anthapath branch has one branch manager who is also (ssistant <ice 3resident of the bank.
They have two principal officer and si& officers. They have five s"b staff also.
+.1?. 7evelopment of !anpower 9esearch Training and !otivation.
The principles and working proced"res of Islamic Banks are completely now and different from
the conventional banks.
There is an inevitable need for training of the employees of the banks to orient and att"ne them
to the new system of Islamic banking to cater to this need Islamic Bank training and 9esearch
(cademy :IBT9(; was established in 198* soon after the inception of the Bank.
The activities of IBT9( cover both training and research on vario"s aspects of Islamic banking.
The (cademy developed a rich library of its own with a treas"re of val"able books on different
s"b$ects incl"ding Islamic economics banking comparative philosophies and $o"rnals of home
and abroad and research articles and doc"ments. Amployees of the Bank learners and
researchers have been taking f"ll advantage of the library.
The (cademy edited books on 19eading in Islamic Banking2 and 1Investment 6perations2. It
also edited and p"blished a broch"re in 1Investment and Trade 6pport"nities in Bangladesh.2
Eeeping in view the e&isting and f"t"re training re)"irement on the Bank and also to generally
cater s"ch needs of different Islamic banking F financial instit"tions of the region the
management of Islamic Bank Training and 9esearch (cademy has been placed at the disposal of
and (cademic Bo"ncil consisting of 3 7irectors of the Board !anagement A&ec"tives of the
Bank #hariah scholar renowned academicians and representatives of rep"ted instit"tions
engaged in the training of bank officials of the co"ntry. Islamic Bank Training and 9esearch
(cademy has introd"ced 7iploma in Islamic
+.18. 9elationship Between Banker (nd Blients.
(bolition of Interest from transaction. Banker0B"stomer relationships in Islam are established on
a profitLloss income sharing arrangement instead of interest. The Islamic #hariah prescribes how
a society is to be organi%ed what will b the relationships of its members and how the affairs of
the members are to be cond"cted. (ccordingly the relationship between a banker and a c"stomer
was established "nder the Islamic banking system.
(ss"rance of 7istrib"tive G"stice. 5hile any ret"rn on capital in the form of interest is
completely prohibited in Islam there is no ob$ection in getting a ret"rn on capital if the provider
of capital enters into a partnership with a worker or entreprene"r and is prepared to share in the
risks as well as the gains between them.
The depositors of the bank may not be g"aranteed a predetermined ret"rn on their saving b"t
they wo"ld be entitled to a share in the act"al profits earned by the bank. #imilarly the bank
wo"ld not be entitled to claim a predetermined ret"rn on the capital provide by it to the borrower
b"t can enter into a profitLloss income sharing arrangement with them.
9endering Improved B"stomer #ervice. Better c"stomer services can ens"re better relationship
between a banker and c"stomer. Logically c"stomers can claim some services as debtors
creditors b"yers and some as fellow !"slim brothers and still some more as fellow men in
general. Islam is well known as a complete code of life based essentially on the many verses of
the holy I"ran and many sayings of the 3rophet :peace is "pon him;. #o it is the d"ty of an
Islamic Bank to satisfy the needs of the above parties.
Legal 9eformation. To give the legal shape to the banker0c"stomer relationship in Islam some
e&isting conventional banking laws and related laws need to be changed according to Islamic
#hariah. In 3akistan 13 :thirteen; e&isting laws have been changed to Islami%e its banking
system.
Alimination of Banking /ra"d. (n Islamic bank behind which the Islamic faith acts is based on
Islamic #hariah so it en$oys the opport"nity to employ the devoted !"slims in the banking
profession. It may also increase the religio"s val"es among the c"stomers by imparting training
to them so that they possess a mind free of fra"d. It recogni%es that a religio"s man always keeps
himself away from fra"d.

3.1. Introd"ction.
-eneral Banking is the heart of Banking. 4ere money collection proced"re occ"rs. 6ther
services like che)"e encashment acco"nt transferM acco"nt closing bills and remittance are
provided here. #o general banking section is the life blood in banking service. The activities
perform thro"gh some proced"res s"ch as 7ispatch :inward0o"tward; 7eposit (LB opening and
closing transfer Bhe)"e book iss"e local remittance :3ayment order 77TT; collections0
transfer delivery IBB 6BB Bash <a"lt 3acking and handling and evening Banking.
3.+. /"nctions.
1. Iss"ance of token !aintenance of s"bsidiary day book writing of day Book Balancing of
ledger.
+. 6pening acco"nt !"daraba #avings (LB !"daraba term deposit (LB (l05adiah c"rrent
(LB !"daraba 4a$$ savings (LB writing of (Lc opening registers and iss"ance of pass book and
che)"e book.
3. !aintenance of c"rrent (LB ledgers deposit ledger and T79 ledger and operation of
comp"ter.
*. 5riting of transfer scroll statement of c"rrent (LB and deposit (LB and 4a$$ deposit (LB pass
book.
=. Bills. 6"tward and Inward Bills :6BB F IBB; and clearing.
>. 9emittance. Iss"ance and payment of 77 TT 36 etc.
?. 5riting of clean cash book and posting of general ledger and che)"eing of comp"ter final
sheets with general ledger.
8. !aintenance of charges s"spense and s"ndry deposit (LB maintenance of dead stock and
stationary articles registers..
9. #ched"le telegram and preparation of general ledger (LB statement.
1,. Astablishment. 3reparation of salary pay sheet L3B maintenance leave register personal
files and method of correspondence and payment of income ta&.
11. 9econciliation of general (LB.
3.3. 7ispatch.
Inward.
!ail other than those which are registered marked confidential and addressed personally to
some official may be opened by an a"thori%ed member or staff who sho"ld enter in the inward
mail register and mention serial n"mber of the mail register on the letterL paper received affi&
19eceived2 date stamp on it and delivery the same to the concerned officials against
acknowledgement.
+. Letters addressed personally to any official shall be opened by the addressee only.
3. 9egistered mails and mails marked confidential will be opened by an officer or management
in small branches. (ll these letters shall however enter in the inward mail registers.
*. #top payment instr"ctions and co"rt orders shall be received by a"thori%ed officials who will
immediately note date and time on it and take necessary steps.
6"tward.
1. 6"tward letters m"st bear serial n"mber and entry in the register with name and address.
+. Aach typist will maintain a typist master file and dispatch Blark also maintain a separate
master file for f"t"re record.
3. Local letters may be delivered thro"gh peon book. If the area is large and letters are many in
n"mber service of post0office may be "tili%ed.
*. Letters dispatched m"st be entered in the o"tward mail register and bear proper postal stamps
if sent thro"gh post office.
=. 9emarks s"ch as 1"rgent2 1By (irmail2 19egister2 9egistered with (L7 1Bonfidential2 etc.
m"st appear on top of the letter as well as envelop.
>. If the letters are sent by registered post or co"rier service postal receiptL co"rier receipt m"st
be maintained by the dispatch department in a file. #imilarly acknowledgements received back
sho"ld be maintained in the file.
?. If any telegram is sent by any branch a copy of the message d"ly signed by a"thori%ed officer
m"st be sent by post to the address as confirmation
8. #imilarly when the branch receives any inward telegram they m"st compare it with the
confirmatory copy when received.
9. 9eceived for telegraphic message iss"ed by telegraph office sho"ld be maintained in a file and
a"thori%ed officer m"st check them at the time of passing e&penses vo"cher.
1,. If any telegram is sent relating to services given to a c"stomer charges sho"ld be recovered
from the c"stomer concerned.
11. !anager and other officers of the bank m"st ens"re economic "se of telephone. Tr"nk call
and #T7 conversation m"st be short. If telephone is "sed on acco"nt if c"stomers charges m"st
be recorded.
1+. Tr"nk calls and #T7 calls m"st be recovered in the tr"nk call register and verified with the
telephone bill when received from TFT office.
3.*. 7eposit.
6b$ectives F 3rinciples.
+. To enco"rage people to save for self and for the co"ntry as a whole.
3. To develop a s"stained savings habit among the people.
*. To mobili%e deposits thro"gh the operation of following acco"ntsM
(; (l0 5adeeah B"rrent (cco"nt. 7epositing for the p"rpose of "sing.
B; !"daraba savings acco"nt. The term 1!"daraba2 means partnership. Blient provides money
F Bank involves with management. 3rofit is apportioned as per 3re (greed ratio. @at"ral loss is
borne by the client.
B; !"daraba term 7eposit (cco"nt. 3L>L1+L+*L3> months.
7; !"daraba #pecial @otice (cco"nt.
A; !"daraba 4a$$ #avings acco"nt. :a special acco"nt to facilitate performance of pilgrimage by
fi&ed income gro"p;. 1 to += years term.
/; !"daraba #pecial #avings :pension; acco"nt. = years F 1, years term.
-; !"saraba #avings Bond #cheme. = years F 8 years term.
4; !"daraba /oreign B"rrency 7eposit (cco"nt.
I; !"daraba !onthly 3rofit 7eposit (cco"nt.
G; !"daraba m"hor :7owry; #avings (cco"nt.
E; !"daraba 5a)f Bash 7eposit (cco"nt. 7eposit taken for the p"blic welfare from the well0off
and the rich people of the society.
8 To operate c"rrent acco"nt on (l05adeeah principle F all other deposit acco"nts on !"daraba
principle of Islamic r"les and reg"lations.
8 The bank distrib"tes minim"m >=K of its investment income earned thro"gh deployment of
!"daraba deposits among the !"daraba depositors.
3.=. (LB 6pening Aligibility.
a. 3ersons over 18 years :e&cept some restricted persons;
b. (cco"nt of cl"b.
c. (ssociation
d. (gent
e. -overnment
f. #emi0-overnment.
g. 6rgani%ation.
h. Li)"idators
i. !inor
$. !arried 5omen
k. Illiterate person
3.>. (cco"nt Blosing.
/irst a c"stomer has to s"bmit an application with hisLher signat"re mentioning that heLshe wants
to close his L her (LB. Then the signat"re will be verified by the officer. B"stomer has to certify
by different department : (dvance /oreign A&change 7epartment; of Bank that he L she has no
liability to the bank. (fter that the c"stomer's acco"nt is debited and then Bank iss"es a 3ay
6rder in the name of (LB holder.
3.?. (cco"nt Transfer.
B"stomer has to s"bmit an application mentioning that he Lshe wants to transfer hisLher (LB to
his desired Branch and the officer will verify the signat"re c"stomer has to be certified by
different department of Bank that heL she has no liability to the bank. Then total partic"lars of
(LB holder will be prepared and dent to the c"stomer's desired branch. Liability of recogni%er is
secondary and acco"nt holder is primary.
3.8. -eneral 3ractices 9egarding (cco"nt 6pening 9egister.
(fter f"lfilling all re)"irements for opening acco"nt necessary entries are given by the acco"nt
opening officer. There are several registers for several acco"nts as !#( (5B( and T79 etc.
7ate of opening name of the acco"nt holder nat"re of b"siness address initial deposit
introd"ction and information are recorded in the register. @ew acco"nt n"mber is given from the
list of new n"mbers provided by the comp"ter department.
Bhe)"e Book.
Bhe)"e Book is iss"ed to the new c"stomer after opening acco"nt. Two separate Bhe)"e books
are given for c"rrent and savings acco"nts. (5B( Bhe)"e book consists +, and =, leafs while
!#( Bhe)"e book contains 1, leafs. There is a Bhe)"e iss"e
9egister in this regard where Bhe)"e book n"mbers leaf n"mber date of iss"e etc. information
are kept properly. (ll the necessary n"mbers are sent to the comp"ter department to give entry in
the program.
#ervice Bharge.
Taka 1, or =, N each for twice a year is debited from c"stomers (5B( acco"nt for rendering
service to him. Taka =, N each is debited from c"stomers acco"nt for providing him solvency
certificate.
3.9. 3rofit.
3rofit is the price of the prod"ct which is determined by the market forces. Avery bank offers a
competitive price to attract deposit.
a. 3rinciples of the distrib"tion of profit to the !"daraba 7epositors
The principles of calc"lation and distrib"tion of profit to !"daraba 7epositors generally
followed by different Islami Banks are as "nder.
1. !"daraba depositors share income derived from investment activities that is from the "se of
f"nd.
+. !"daraba depositors do not share any income derived from miscellaneo"s banking services
where the "se of f"nd is not involved s"ch as commission e&change service charges and other
fees reali%ed by the bank.
3. 3rofit and losses res"lting from the "se of f"nds are separately maintained in the acco"nts
from other income and e&pendit"re relating to other activities and services offered by the Bank.
*. !"daraba 7eposits get priority in the matters of investment over bank's e)"ity and other cost
free f"nds.
=. !"daraba 7epositors do not share any income derived from investing Bank's e)"ity and other
cost free f"nds.
>. The amo"nt of the stat"tory cash reserve and the li)"idity reserve which are re)"ired to be
maintained with Bangladesh Bank is ded"cted from the aggregate balance of !"daraba 7eposits
to arrive at the net balance of profit sharing deposit.
?. The gross income derives from investments d"ring the acco"nt year is at first allowed to
!"daraba 7epositors and cost0free0f"nds according to their proportion in the total investment.
8. The share of gross investment income of !"daraba 7eposits as worked o"t in terms of
principle shown against serial @o ? above is distrib"ted as "nder.0
:(; !"daraba depositors' share of >=K of gross investment income might f"rther be raised by
the bank's !anagement at its discretion to rationali%e the rates of profit to !"daraba depositors
b"t it wo"ld not be red"ced d"ring any acco"nting year witho"t giving prior declaration.
:B; The rest amo"nt of gross investment income is retained by the bank as management fee for
managing the investment F for making reserve for bad and do"btf"l investments.
3.1,. Local 9emittance.
IBBL sells and p"rchases 36 77 F TT to its c"stomers only. It does not offer remittance
service fre)"ently to those other then its c"stomer.
3ay 6rder :36;.
3ay order is an instr"ment which is "sed to remit money within a city thro"gh banking channel.
The instr"ments are generally safe as most of them are crossed. The iss"ing branch will make the
payment. 3ay order m"st be acco"nt pay.
7emand draft :77;.
7emand draft is a pop"lar instr"ment for remitting money from one corner of co"ntry to another.
This instr"ment is basically "sed for transfer and payment. 7ifference between pay order and
demand draft is in terms of place only. 36 is "sed for remittance money with the city where as
77 is "sed for within the co"ntry 77 too constit"tes c"rrent liability on the part of a bank. (t
IBBL 77 is not sold to people other than its c"stomers.
(dvantages of 77.
Ban avoid risk.
I"ick disposalL settlement of money transfer transactions.
Ban avoid physical cash.
Telegraphic Transfer :TT;.
Telegraphic transfer is one of the fastest means of transferring money from one branch to another
or from one to another place. The TT iss"ing bank instr"cts its co"nterpart by tested tele&
message regarding remittance of money. @o instr"ment is given for TT both parties sho"ld have
acco"nt as money is transferred.
3.11. Bollections.
Blearing.
(s far safety is concerned c"stomers get crossed Bhe)"e for the transaction. (s we know crossed
Bhe)"e cannot be encased from the co"nter rather it has thro"gh been collected thro"gh banking
channel that is clearing. ( client of IBBL received a Bhe)"e of another bank which is located
within the clearing range deposit the Bhe)"e in amo"nt at IBBL new IBBL will not the money
"ntil the Bhe)"e is honored.
Transfer 7elivery.
Transfer delivery is a che)"e collection proced"re among internal branches within the clearing
ho"se. 5hen a che)"e is of a branch office is deposited to another branch office then collecting
branch on that date sends that che)"e to their local office sends that che)"e to that respective
ranch and takes necessary action for honoring che)"e.
If the che)"e is dishonored then a"thori%ed branch send the che)"e to the local office and local
office send that che)"e to the collecting branch on the collecting date.
4ere clearing ho"se f"nction is not re)"ired beca"se transactions occ"r among the same branch
of same bank within the clearing ho"se.
Bhe)"e is of a #ame Branch of IBBL.
If the che)"e is of a branch office of a bank :within the clearing ho"se of sane city; then the
collection branch send the che)"e to the a"thori%ed branchLdrawn on branch and iss"es an IBB(
to the collecting branch.
6n the other hand if the che)"e is of another bank :o"tside of clearing ho"se to another city;
then che)"e collecting branch will find o"t whether any branch office of the collecting branch
sit"ated near to a"thori%ed branch.
If yes then che)"e collecting branch will send the che)"e to the branch office near a"thori%ed
branch that branch :near a"thori%ed branch; officer collect the che)"e from drawn on branch and
iss"es an IBB(.
If not then the collecting branch will send that che)"e to the a"thori%ed branch after that
a"thori%ed branch will send a 77 with mentioning the name of their branch office near
collecting branch and collecting branch will collect that che)"e thereby.
6"tward bills for Bollection :6BB;.
B"stomers deposit che)"e draft etc for collection attaching with their deposit sleep. Instr"ment
within the range of clearing are collected thro"gh local clearing ho"se b"t the other which are
o"tside the clearing range are collected thro"gh 6BB mechanism. ( c"stomer of IBBL principal
branch local office 7haka is depositing a che)"e of #onali Bank Bo&'s0 Ba%ar. @ow as a
collecting bank IBBL principal branch will perform the following tasks.0
1. 9eceived seal on deposit sleep.
+. IBBL local office principal branch crossing indicating them as collecting bank.
3. Andorsement give payees (LB will be credited on reali%ation.
*. Antry on register from where a controlling n"mber is given.
Bollecting bank can collect it either by its branches or by the drawer's bank they will forward the
bill then to that artic"late branch. 6BB n"mber will be given on the forwarding letter.
Inward Bill for Bollection :IBB;.
In this case bank will work as an agent of the collection branch receives a forwarding letter and
the bill. @e&t steps are.0
Antry in the IBB register IBB n"mber given.
Andorsement given0 1o"r branch endorsement conformed2.
The instr"ment is sent to clearing for collection.
!iscellaneo"s creditor (LB0
Bredit Transaction.
5hen a branch re)"est another branch :of the same bank; to pay a certain amo"nt against any
instr"ment : che)"e 77 etc; and become liable to that bank iss"es a IBB( to that branch and
these transactions are recorded in the credit side of IB- (LB serially.
7ebit Transaction.
5hen some che)"es or any sort of financial instr"ment of another branch are deposited in a
branch and this branch pays those instr"ments on behalf of a"thori%ed branch iss"es an IB7( to
that branch and those transactions are recorded in the debit side of IB/ (LB.
9esponding branch.
5hen a branch responds against an IBB( or an IB7( that branch is called responding branch.
Bash.
Bash section demonstrates li)"idity strength of a bank. It also sensitive as it deals with li)"id
money. !a&im"m concentration is given while working on this section. (s far as safety is
concerned specials preca"tion is also taken. Tense sit"ation prevail if there is any imbalance in
the case.
Teller B"stomers 9elationship.
In a bank a person who delivers and receives cash from the cash co"nter is known as teller. (
c"stomer meets most if the time in a bank with a taller on the co"nter. #o teller sho"ld hold
certain )"ality sho"ld be friendly provided prompt service and be acc"rate in his or her task.
Bash 3acking and 4andling.
Bash packing and handling needs a lot of care as any mistake may lead to disaster. 3acking after
banking ho"r when the co"nter closed cash is packed according to denomination. @otes are
co"nted several times and packed in b"ndle stetted and st"mped with initial.
Avening Banking.
(fter the banking ho"r the cash co"nter is closed. B"t sometimes c"stomers come to draw or
deposit money after the service ho"r. 4owever their money is received or paid recorded in the
ne&t daybook. This is known as evening Banking.
Bhapter0*
#56T (nalysis and /inancial (nalysis
Bhapter0*
#56T (nalysis and /inancial (nalysis
#56T (nalysis.
#56T stands for strengths weaknesses opport"nities and threats. It is a methodology "sed to
aid strategic planning that gained pop"larity d"ring the 8,'s. To do a #56T analysis considers
these. #trengths. 5hat are yo"r advantagesO 5hat do yo" do wellO 5eaknesses. 5hat co"ld be
improvedO PThose are given below.
*.1. #trength.
8 4onest and 9eliable Amployees. (ll of the employees of Islami Bank are honest and reliable.
They are always devoted themselves to the works for better c"stomer service they have no
corr"ption report.
8 (de)"ate /inance. Islami Bank Bangladesh Ltd. 4ave ade)"ate finance. That is why they need
not to borrow money from Bangladesh Bank or any other banks.
8 !ore f"nds for Investment. for ade)"ate financial ability they can provide loan to the more
investment clients.
*.+. 5eakness.
Lack of (de)"ate Amployees. @"mber of employees is fewer than the vol"me of works which
creates problem for prompt service.
Lack of "p to date e)"ipment's. IBBL has lack of modern technologies and e)"ipment's like
online facilities fa& cash card and credit card system.
*.3. 6pport"nity.
9eligio"s !inded 3eople. !ost of the people of o"r co"ntry are religio"s minded. #o they accept
the concept 1Interest free banking system2 and going to Islami Bank with more interest.
#pecial Image. IBBL has created special image to the people as a more reliable bank. 3eople
believe that if they keep their money in Islami Bank it will be more sec"red than other banks.
*.*. Threat.
9"les and 9eg"lation. The r"les and reg"lations of Bangladesh are not favorable for Islami
Bank. #o they have to face vario"s problems to operate their activities according to Islami
#hariah.
!ore Bompetitors. There are a lot of competitors in banking sector of Bangladesh. #o it's a great
threat for them. There are not only the conventional banks b"t also some other Islami Banks in
the market as their competitors. Bonventional banks are always trying to "nderstand people that
interest and dividend are the same thro"gh vario"s advertisement and p"blicity.
*.=. /inancial 3erformance.
The financial performance of the bank improved noticeably in /Q +,,? over the previo"s year
which is eval"ated in terms of @et Income 9et"rn on (verage (sset :96((; and 9et"rn on
(verage A)"ity :96(A;. The bank yet holds the highest profit earning bank among the private
commercial banks in the co"ntry. 7"ring the QA+,,? the Bank earned a net profit after Ta& of
Tk. +,*9.,= million compared to TE. 1*,,.=9 million in QA +,,> considerable increase of
*>.3,K over previo"s year.
4owever the above increase was +*.*1K in the last year i.e. +,,>. The above financial res"lt
yields a ret"rn of 1.+,K on average assets in QA +,,? compared to 1.,3K and 1.,,K in QA
+,,> and QA +,,= respectively against peer average of 1.>3K in QA +,,?. IBBL is in lower
position in generating income than its peer. 7"ring the year of +,,? earning on average e)"ity
:96(A; has also increased to 18. ?>K in compared to 1=.3?K in QA +,,> and 1=.1>K in QA
+,,= against peer average of +*.++K in QA +,,?.
@et Investment Income !argin :@II!; of IBBL stood at 3.91K in QA +,,? against +.99K in QA
+,,>. The peer average of @II! was 3.?+K in QA +,,? and 3.31K in QA +,,>. @II! has
increased d"e to high yield rate than low cost of f"nd. The Aarning per share of Tk.
Chapter- +
2indings3 !ecommendation 4 Conclusion"
+.1. 2indings"
IBBL is the pioneer of lslami Banking B"siness in the private #ector in Bangladesh.
In general banking department IBBL follow the traditional banking system. The entire general
banking proced"re is not f"lly comp"teri%ed.
There is no comp"ter in remittance section. That's why the service is not prompt as the
c"stomers desired.
IBBL is not "sing 7ata Base @etworking in Information Technology 7epartment
(ccording to the opinion of some client's introd"cer is one of the problems to open acco"nt if a
person who isn't new as a client wants to open an acco"nt it is a problem for him Lher to manage
an introd"cer for a reg"lar acco"nt.
The officers in the general banking department prod"ce vo"cher man"ally and send them to
posting officer to post them in the comp"ter .The "s"ally do not get involved themselves in
generating vo"cher by comp"ter.
9emittance both local F foreign is effective manner of c"stomer #ervice.
=.+. 9ecommendation.
IBBL needs to improve its most earning assets to increase its earnings. It sho"ld take vario"s
attractive schemes in this regard.
It has to ens"re "niformity in branch performance. /or this p"rpose vario"s training programs
and workshops sho"ld be la"nched.
Islami Banks Investment in agric"lt"re and r"ral sector is low compare of other sectors. It sho"ld
give emphasis to promote agro0based ind"stry.
IBBL has to start e&tensive on line banking in order to keep pace with +1 cent"ry's challenge.
(ll the government approved sec"rities in Bangladesh are interest bearing. -overnment and
Bangladesh Bank need to take care to this sit"ation.
IBBL has to foc"s on modern banking service more.
(ltho"gh it has an honest gro"p of employees more care to improve h"man reso"rce sho"ld be
given.
/"ll comp"teri%ation of all activities of IBBL sho"ld be introd"ced
+.$. Conclusion"
The Banking sector is a sector at the one side and it is the l"bricant of the entire economy on the
other side. The importance of banking sector in Bangladesh is more significant as the informal
sectors s"ch as wholesale and retail trading transport constr"ction and other small scale
services play important role in this economy. 4ence proper "tili%ation of the banking channel is
more important in Bangladesh. Islami Banks are those who do not charge interest rather they do
b"siness on profit sharing basis.
The basic difference between Islami Banks and the ordinary banks is that the Islami Banks do
b"siness on profit0sharing basis and do not change any interest where as the ordinary banks
operates on the basis of interest charging. Islami Bank co"ld also maintain the capital ade)"acy
ratio and provide for loans and advances considered bad and do"btf"l of recovery "p to the level
as stip"lated by the monetary a"thority of the co"ntry. The average growth rate of deposits and
lending of the Bank is very good and even on a few occasions the growth rate is low. The
activities of IBBL is so far diversified attempts are grad"ally being made for increasing the
n"mber of self reliant pro$ects providing assistance to instit"tionsL organi%ations and individ"als.
(s a market leader offering banking services based on the Islamic r"le of #hariah IBBL's
profitability trend has been )"ite impressive.
The Banks ability to keep its ret"rns on asset well above the ind"stry average reflected it
resilience to possible shocks in the banking system. It is one of a few local banks according to
B(!!AL :capital asset management earnings and li)"idity; rating made by the Bangladesh
Bank. It holds the highest amo"nt of li)"idity among all banks and its ability to keep ret"rn on
asset is well above the banking sectors average.
The grad"al and s"ccessf"l globali%ation of Islamic banking co"pled with growing awareness of
the people abo"t its financial and social benefits makes it clear that the ne&t cent"ry is going to
be the cent"ry of Islamic Banking.