Project

JANATA BANK LIMITED
“A Committed Partner in Progress”
Acknowledgement
At the very beginning I would like to express my deepest gratitude to the Almighty God for
giving me the strength and the composure to finish the task within scheduled time.
I would like to express my gratitude and indebtedness to my respected supervisor Ms. Naznin
Sultana Chaity, Lecturer, School of Business, Ahsanullah University of Science and
Technology from the core of my heart for her kind support, guidance, supervision,
instructions and advice that motivating me to do this report.
I am also thankful to Mr. Md. Sirajul Haque(Assistant General Manager), Janata Bank
Limited, Kawran Bazar Corporate Branch for giving me the opportunity to conduct my
internship. I am also grateful to B. K. Kar (Senior Executive Officer) and Subrata Roy
(Executive Officer) of this branch who helped me a lot to complete my internship report by
providing various financial data of the bank.
Finally, I would also like to thank to the authority of Ahsanullah University of science and
Technology, for their kind co-operation.
Ahsanullah University of Science & Technology Page | 1

JANATA BANK LIMITED
Executive Summary
The economic development of a country depends largely on the activities of commercial
Banks. Especially a country like Bangladesh, our agricultural, industrial and economic
developments are very much depending on smooth operation of Banks. So we must ensure
the efficient and effective performance of this sector.
Janata Bank Ltd is one of the largest commercial Bank of Bangladesh. The main objective of
the Bank is to provide all of banking services at the doorsteps of the people. The Bank also
participates in various social and development programs and takes part in implementation of
various policies and promises made by the Government.
The bank plays a pioneering role in handling foreign exchange transactions. With wide
network of branches at home and abroad, the bank maintains the largest volume of export-
import business including homebound remittances. For this reason, Foreign Exchange of the
Bank is very much essential.
This internship report is aimed at providing a comprehensive picture to the areas of “Foreign
Exchange Activities” of Janata Bank Limited and a pinpoint analysis of the operations and
performances of the bank, also recommending for possible solution of problems. The report
is based on primary and secondary data from different sources. In this report I have tried to
show the contribution of JBL‟s earnings regarding export, import and remittance.
The report contains of the followings parts: Introduction of the Report, Profile of the
Organization, Operational Procedure of the Foreign Exchange Division, Activities of Letter
of Credit, Import Section, Export section, Remittance Section, Findings & Analysis,
Recommendation and conclusion.

JANATA BANK LIMITED
Table of Contents
Serial No. Contents Page No.

Letter of Transmittal i
Acknowledgement 1
Executive Summary 2
List of Acronyms 7
Chapter 1 Introduction of the Report 8-15
1.1 Origin of the Report 9
1.2 Objectives of the Report 9
1.3 Methodology of the Report 9
1.4 Scope of the Report 10
1.5 Limitations of the Report 15
Chapter 2 Profile of the Organization 11-21
2.1 Background of the Organization 12
2.2 Mission & Vision of the organization 12
2.3 Purposes of Janata Bank Limited as a Commercial Bank 13
2.4 Functions of Janata Bank Limited as a Commercial bank 14
2.5 Corporate Profile of Janata Bank Limited – At a Glance 14
2.6 Management Organogram of Jnanta Bank Limited 16
2.7 Management Organogram of Jnanta Bank Limited, 17
Kawran Bazar Corporate Branch
2.8 Service offerings/ Products of the Bank 17
2.9 Number of Branches 18
2.10 Five years Comparative Financial and Operational 19
performance
2.11 Corporate Social Responsibilities (CSR) 20
2.12 Reward and Recognition 20
2.13 Future Plans of the Organization 21
Chapter 3 Foreign Exchange Division 22-27
3.1 Foreign Exchange 23
3.2 Meaning of Foreign Exchange 23
3.3 Necessity of Foreign Exchange 23
3.4 Activities of Foreign Exchange Division 24
3.5 Regulation for Foreign Exchange Division 24
3.6 How Foreign Exchange is being Controlled 25
3.7 Foreign Exchange Performance of JBL 25
3.8 Risk Management of Foreign Exchange Operation 27
Chapter 4 Activities of Letter of credit (L/C) 28-33
4.1 Letter of credit (L/C) 29
4.2 Types of Letter of credit (L/C) 29
4.3 Letter of credit (L/C) Transaction Process 30
4.4 Parties involved in the Letter of Credit 31
4.5 Basic Procedures for Opening a Letter of Credit (L/C) 31
4.6 L/C Application Form (L/CAF) 32
4.7 Letter of Credit (L/C) Settlement 33

JANATA BANK LIMITED
Chapter 5 Import Section 34-41

5.1 Meaning of Import 35
5.2 Import Department 35
5.3 Import Policy 35
5.4 Import Procedures 36
5.5 Import Mechanism 36
5.6 Types of Import 36
5.7 Goods are not Importable 37
5.8 Import Financing 37
5.9 Documents Receipt and Scrutiny 38
5.10 Graphical Presentation and Discussion of Import 39
Chapter 6 Export Section 42-53
6.1 Meaning of Export 43
6.2 Export Department 43
6.3 Documents used in Export 43
6.4 Registration for the Exporter 45
6.5 Formalities and procedures of export L/C 45
6.6 Export Financing 46
6.7 Graphical Presentation and Discussion of Export 51
Chapter 7 Remittance Section 54-62
7.1 Meaning of Remittance 55
7.2 Foreign Remittance 55
7.3 Remittance Services in Janata Bank limited 55
7.4 Types of Remittance 56
7.5 Remittance market in Bangladesh 58
7.6 Problems /Roadblocks in Current Remittance Process 59
7.7 Help Desk Related to Foreign Remittance Problem 59
7.8 Steps Taken for Remittance Process Improvement 59
7.9 Graphical Presentation and Discussion of Foreign 60
Remittance
Chapter 8 Findings and Analysis 63-74
8.1 SWOT Analysis 64
8.2 Comparison and Performance evaluation of Janata Bank 66
Limited
8.3 Comparison of profit performance of Janata, Agrani and 66
Rupali Bank Ltd:
8.4 Total Income, Expenditure and Profit Performance of 68
JBL, Kawran Bazar Corporate Branch
8.5 Import Performance of JBL Compare to National Import 70
8.6 Foreign Remittance Performance of JBL Compare to 72
National Foreign Remittance
8.7 Shortcomings of JBL from my Viewpoint 74
Chapter 9 Recommendation and Conclusion 75-79
9.1 Recommendation 76
9.2 Conclusion 79
Reference 80
Appendix

JANATA BANK LIMITED
List of Figure

Figure 1 Functions of Janata Bank Ltd 14
Figure 2 Management Organogram of Jnanta Bank Limited 16
Figure 3 Management Organogram of JBL, Kawran Bazar 17
Corporate Branch
Figure 4 CSR Activities of Janata Bank Ltd 20
Figure 5 Activities of Foreign Exchange Division 24
Figure 6 Types of Letter of Credit 29
Figure 7 Letter of Credit Transaction Process 30
Figure 8 Types of Remittance 56
Figure 9 Modes of Inward Remittance. 57
Figure 10 Modes of Outward Remittance 58
Figure 11 SWOT Analysis 64
List of Table

Table 1 Corporate Profile of Janata Bank Limited 14
Table 2 Number of Branches 18
Table 3 Five years Comparative Financial and Operational 19
performance
List of Graph

Graph 1 Foreign Exchange Performance of JBL 26
Graph 2 39
Import performance of JBL
Graph 3 Import Performance of JBL, Kawran Bazar Corporate 40
Branch
Graph 4 Import Growth Percentage (%) of JBL, Kawran Bazar 41
Corporate Branch.
Graph 5 51
Export performance of JBL
Graph 6 Export Performance of JBL, Kawran Bazar Corporate 52
Branch
Graph 7 Export Growth Percentage (%) of JBL, Kawran Bazar 53
Corporate Branch
Graph 8 60
Foreign Remittance performance of JBL
Graph 9 Foreign Remittance Performance of JBL, Kawran Bazar 61

JANATA BANK LIMITED
Corporate Branch
Graph 10 Growth of Foreign Remittance in Percentage (%) of JBL, 62
Kawran Bazar Corporate Branch.
Graph 11 Comparison of profit performance of the Janata, Agrani 66
and Rupali Bank Ltd.
Graph 12 profit percentage from 2009-2010 of the Janata, Agrani 67
and Rupali Bank Ltd.
Graph 13 Total Income, Expenditure and Profit Performance of JBL, 68
Graph 14 Growth of Profit Percentage (%) of JBL, Kawran Bazar 69
Corporate Branch.
Graph 15 Import Performance of JBL Compare to National Import 70
Graph 16 Contribution Percentage of JBL in National Import 71
Graph 17 Contribution of JBL in National Foreign Remittance 72
Graph 18 Contribution Percentage of JBL in National Foreign 73
Remittance

JANATA BANK LIMITED
List of Acronyms
AD Authorized Dealer
AGM Assistant General Manager
ATM Automated Teller Machine
BB Bangladesh Bank
CAMELS C- Capital Adequacy
A- Asset Quality
M- Management
E- Earnings
L- Liquidity
S- Sensitivity to Market Risk
CCI&E Chief Controller of Import & Export

CIF Cost, Insurance and Freight
C&F Cost & Freight
CSR Corporate Social Responsibilities
DD Demand Draft
FER Foreign Exchange Regulation
FOB Free On Board
GATT General Agreement on Tariff and Trade
GDP Gross Domestic Product
HRM Human Resource Management
ICC International Chamber of Commerce
ICMAB Institute of Cost and Management Accountants of
Bangladesh
IME International Money Express
IRC Import Registration Certificate
JBL Janata Bank Limited
L/C Letter of Credit
L/CAF Letter of credit Application Form
LIM Loan against Imported Merchandise
LTR Loan against Trust Receipt
MT Mail Transfer
MIS Management Information System
NCB Nationalized Commercial Bank
PAD Payment Against Documents
PO Pay Order
PRC Proceeds Realization Certificate
RMG Ready Made Garments
SEO Senior Executive Officer
SWIFT Society for Worldwide Interbank Financial
Telecommunication
TC Travelers Cheque
TIN Tax Identification Number
TT Telegraphic Transfer
UCPDC Uniform Customs & Practices for Documentary Credit
UN United Nations
WTO World Trade Organization
JANATA BANK LIMITED
Chapter 1
Introduction of the Report

JANATA BANK LIMITED
1.1 Origin of the Report

This report has been prepared as an internship report which is a mandatory requirement for
successful completion of BBA program under Ahsanullah University of Science and
Technology and which aims to reflect the professional view of real world working experience
and environment. This internship report is required to submit after fulfilling 3 months of
working experience in an organization as a trainee. This Three months internship period has
helped me to match my theoretical knowledge with practical understanding. My report is on
the foreign exchange activities of Janata Bank Limited. In this part I have tried to see the
things what are being done in this department of the branch. I have also tried to present my
personal observations from each department of this branch. I had an opportunity to be
acquainted with the practical banking prevailing in Kawran Bazar Corporate Branch. The
knowledge which has been acquired in my Internship Period, I have tried my level best to
show in this report.
1.2 Objectives of the Report

The main objective of the study is to analyze the foreign exchange business of Janata Bank
Limited through practical exposures about “Foreign Exchange Activities” a comprehensive
Study of Janata Bank Ltd. (considering Janata Bank Ltd, Kawran Bazar Corporate Branch).
There are some specific objectives on the way of achieving the main objective. These are as
follows:
 To fulfill the partial requirement of BBA Program

 To apply theoretical knowledge in the practical field
 Draw a general picture of foreign exchange operations of JBL
 The views of export, import & remittance operation of Bangladesh through JBL
 The contribution of JBL in national remittance
 To analyze the export and import procedure maintained by JBL
 To describe the organizational structure, management, background, functions and
objectives of the bank and its contribution to the national economy.
 To know about different types of financial products offered by JBL
 To know about the objectives and planning of JBL
 To analyze the barriers faced by the bank
 To evaluate performance of the bank
 To make myself more confident and active in future
1.3 Methodology of the Report

In order to make the report more meaningful and presentable, two sources of data and
information have been used widely.
The “Primary Sources” of data are as follows:
 Face-to-face conversation with the respective officers and staffs of the Branch.
 Informal conversation with the clients.
 Practical work exposures from the different desks in the bank.
 Relevant file study as provided by the concerned officers.
The “Secondary Sources” of data are as follows:
 Annual Reports of Janata Bank Ltd
 Web site of the bank
JANATA BANK LIMITED
 Periodicals published by Bangladesh Bank

 Different documents related to bank
 Relevant Books, Research Papers, Journals etc. regarding general banking functions
and foreign exchange activities.
I hope these criteria will be enough to find out different picture of financial performance in
the related sector of the bank.
1.4 Scope of the Report

Mainly the scope of this report is confined to the analysis of Foreign Exchange Activities
of Janata Bank Ltd. Besides this the report covers the background, organizational structure,
functions and performance of the bank also. This report is fully based on the practical
knowledge and experience by working and observing the activities done by the officials.
1.5 Limitations of the Report

It is obvious that every study has some limitations. The study I have made is of great
importance and require me huge work. While conducting I had to face a number of problems.
Those limiting factors that hampered my smooth workings in bank and finally in preparing
this report are as follows:
 The organization maintains strict confidentiality about their financial and other
information.
 Any type of such presentation requires a long time. But duration of this study was too
short to have a sound understanding of the overall banking.
 It was very difficult to collect the information from various personnel for their job
constraint.
 Non‐availability of the most recent statistical data.
 Lack of sufficient books, papers and periodicals take me go on serious brainstorming

while preparing this report.
 I carried out such a study for the first time, so inexperience is one of the main
constraints of the study.

JANATA BANK LIMITED
Chapter 2
Profile of the Organization

JANATA BANK LIMITED
2.1 Background of the Organization

“A Committed Partner in Progress” by this slogan Janata Bank Limited is one of the state
owned commercial banks in Bangladesh, has an authorized capital of Tk. 20000 million
(approx US$ 283.33 million), paid up capital of Tk. 5000 million, reserve of Tk.10823.01
million and retained surplus Tk.5167.18 million. The Bank has total assets of Tk.345233.92
million as on 31st December 2010. Immediately after the liberation of Bangladesh in 1971,
the erstwhile United Bank Limited and Union Bank Limited were renamed as Janata Bank.
On 15th November, 2007 the bank has been corporatized and renamed as Janata Bank
Limited.
Janata Bank Limited has also a subsidiary company named Janata Exchange Company SRL
in Italy. Janata Bank Limited is going to launch Islamic Banking operation its five branches
and also diversified its product they are going to launch Merchant Banking Unit to play an
important role in the capital market. Janata Bank Limited, first among the Nationalized
Commercial Banks, has introduced ATM Services
 Janata Bank Limited has already established a worldwide network and relationship in
national and international Banking through 872 branches including 4 overseas
branches and 1215 foreign correspondents.
 The Board of Directors is composed of 15(Fifteen) members headed by a Chairman.
The Directors are representatives from both public and private sectors.
 Total number of employees are 12826 (twelve thousand eight hundred twenty six) up
to December 31, 2010.
 There are three committees of the board for different purposes. They are:
1. Executive Committee
2. Audit Committee
3. Management Committee
 The Bank has earned an excellent business reputation in handling and funding
international trade, particularly in boosting export & import of the country.
2.2 Mission & Vision of the organization
2.2.1 Mission
Janata Bank Limited will be an effective commercial bank by maintaining a stable growth
strategy, delivering high quality financial products, providing excellent customer service
through an experienced management team and ensuring good corporate governance in every
step of banking network.
2.2.2 Vision
To become the effective largest commercial bank in Bangladesh to support socio-economic

development of the country and to be a leading bank in south Asia.

JANATA BANK LIMITED
2.3 Purposes of Janata Bank Limited as a Commercial Bank

 Making profit
The first and foremost purpose of Janata Bank is to attain profit generally through
collecting deposits and lending this money to earn interest income or by making
investment.
 Providing service and relation development

This bank increases the volume of financial transaction through the development of
relation with the clients.
 Collecting more deposit and money lending

As a commercial bank Janata Bank aims to collect as much as possible money from
the clients through different type of deposit.
 Increasing flow of money

Janata Bank in replace of currency uses different medium as cheque, bank draft, pay
order, latter of credit when doing transaction. Thus it increases the actual flow of
currency.
Janata Bank Limited however serves the following social purposes

 Creating savings
Janata Bank Limited offers different kinds of Savings Account and thus simulates the
people to make savings.
 Formation of capital
The accumulation of savings enables Janata Bank to form capital.
 Ensuring safety
This bank has another purpose to ensure the safety of its client‟s depository money.
 Investment and Industrialization

Janata Bank through short-term, intermediate-term and long-term investment
simulates the investment and industrialization in the country.
 Employment facility
Besides earning profit Janata Bank offers employment facility to the community
people and thus helps increase income.

JANATA BANK LIMITED
2.4 Functions of Janata Bank Limited as a Commercial bank
Functions of
Janata Bank
Limited
General Development Representative

Service function
function function function
Collecting deposit , Creation of savings and

Lending loan , Transaction of
formation of capital, Receive and payment as foreign currencies,
Honouring cheque , helps export and import the representative of information sharing,
Creation of medium business, Investment in clients, selling of share Consulting and
of exchange, development sector, HR and securities, others service
Discounting bills, development etc.
Money transfer etc. functions.
Figure 1: Functions of Janata Bank Ltd.
2.5 Corporate Profile of Janata Bank Limited – At a Glance

Name of the Company Janata Bank Limited
Chairman Dr. Abul Barkat
CEO & Managing S.M Aminur Rahman
Director
Legal Status Public Limited Company

Date of Incorporation 21 May, 2007
Registered Address Janata Bhaban, 110 Motijheel Commercial Area, Dhaka-1000
Bangladesh.
Authorized Capital Tk.20000 million

Paid up Capital Tk.5000 million
Face value per share Tk. 100 per share
Shareholding Pattern 100% share owned by the Government of Bangladesh
Domestic Network Numbers of Branch-868
Numbers of Divisional Office-08
Numbers of Area Office-15
Numbers of Regional Office-29

JANATA BANK LIMITED
Overseas Network Numbers of Branch-4 ( all branches located in United Arab

Emirates)
Numbers of Employees 12826

Telex 675840 JBDBJ, 671288 JBHOBJ
Phone PABX: 9560000, 9566020, 9556245-49, 9565041-45, 9560027-
30
Fax 88-02-9564644, 9560869

E-mail md@janatabank-bd.com
Website www.janatabank-bd.com
Swift Code JANB BD DH

Source: Janata Bank Ltd, Annual Report-2010
Table 1: Corporate Profile of Janata Bank Ltd.

JANATA BANK LIMITED
2.6 Management Organogram of Jnanta Bank Limited
Chairman
Managing Director
Deputy Managing Director
General Manager
Assitant General Manager
Manager
Senior Executive Officer
Executive Officer
Assistant Executive Officer
Support Stuff
Figure 2: Management Organogram of Jnanta Bank Ltd.

JANATA BANK LIMITED
2.7 Management Organogram of Jnanta Bank Limited, Kawran Bazar

Corporate Branch.
Asstt.General
Manager
Manager
Senior Senior
Executive Executive
Officer Officer
Executive Executive Executive

Officer Officer Officer
Asstt. Asstt. Asstt. Asstt. Asstt.

Executive Executive Executive Executive Executive
Officer Officer Officer Officer Officer
Support Stuff Support Stuff Support Stuff Support Stuff Support Stuff Support Stuff
Figure 3: Management Organogram of JBL, Kawran Bazar Corporate Branch
2.8 Service offerings/ Products of the Bank
Janata Bank Ltd provides all commercial banking services to its clients focusing on the
national interest and sustainable growth. The major fields of its activities may be represented
as below:
Deposit Products
 Current Deposit Account

 Short Term Deposit
 Savings Bank Deposit Account
 Fixed Deposit
JANATA BANK LIMITED
 Foreign Currency Deposit

 Monthly Savings Scheme
 Janata Bank Double Deposit Scheme
 Monthly Profit Based Savings Scheme
 Janata Bank Savings Pension Scheme
 Janata Bank Deposit Scheme
 Education Deposit Scheme
 Medical Deposit Scheme
 Janata Bank Monthly Savings Scheme
 Janata Bank Special Deposit Scheme
 Janata Bank School Banking Savings Karjakram
Credits Products
 Term Loan
 Trade Finance
 Import Finance
 Export Finance
 SME Financing
 Micro Credit
 Agriculture & Rural Credit
 Consumer Credit
 Home loan
 Loan for Merchant Banking
E-Service
 Speedy Remittance Western Union Money Transfer

 Automated Clearing
 Internet Banking
 ATM Banking
ATM Operation
 Debit Card Operation

 Salary Card
2.9 Number of Branches

Branches in Bangladesh 868
Rural Branches 486
Urban Branches 382
Overseas Branches 4
Total Branches 872
Source: Website of Janata Bank Ltd.

JANATA BANK LIMITED
List of Branches (Grade/Category wise)
SL Name No
01 Local Office 1
02 Corporate -1 Branches 12
03 Corporate -2 Branches 41
04 Overseas Branches 4
05 Grade - 1 Branches 204
Total 872
Source: Website of Janata Bank Ltd.
Table 2: List of branches
2.10 Five years Comparative Financial and Operational performance

(Taka in million)
Particulars 2006 2007 2008 2009 2010

Authorized Capital 8000 8000 8000 20000 20000
Paid up Capital 2595 2595 2595 5000 5000
Reserve Fund 1727 3224 4183 8207 10224
Deposits 182947 198636 221336 246175 286567
Advance 138493 121200 144678 166359 225732
Investment 24785 55862 57824 72533 57514
Revenue 16272 18522 20922 24074 30614
Cost 12059 13559 13919 15496 18577
Operating Profit 4213 4963 7003 8578 12037
Provisions for 10707 11698 9051 8748 8975
Loan/Assets
Net Profit --- 1681 3145 2982 4907
Export 70897 71855 85418 88653 118515
Import 128809 84065 129413 118525 183744
Total Number of 14772 13860 13379 13122 12826
Employees
No.of foreign 1198 1198 1202 1208 1215
Correspondent
No. of Branches 848 848 849 851 872
(including 4 Overseas
Br.)
Table 3: Five years Comparative Financial and Operational performance

JANATA BANK LIMITED
2.11 Corporate Social Responsibilities (CSR)

As a state-owned bank, it‟s goal is not only make profit, but also to serve people through our
Corporate Social Responsibilities (CSR) .The Bank has adequate scope to provide financial
assistance to the distressed and deprived people individually and through various
organization – towards human development. The Bank pursuing CSR activities with funds
generated from profit. The Bank disbursed Tk.61.29 million in 2010 as against allocated 70
million. CSR aims at maximizing realization of human potentials and minimizing human
deprivation.
CSR activities of Janata Bank Limited of 2010 are given below:
Corporate Social Responsibilities

Poverty reduction and
rehabilitation
7%
7% Health
25%
Knowledge building
16%
Disaster mitigation
Education
25%
20%
Culture
Figure 4: CSR Activities of Janata Bank Ltd.
2.12 Reward and Recognition
The bank has received “The banker Award” in 2003 & 2005, “Asian Banking Award” in
2004 & 2005, “The Best Bank Award” in 2006, 2007, 2008 & 2009 and in 2010 “Productive
Location Champion Award-2010” from Western Union for remarkable growth, extraordinary
performance, and maintaining international standard in the quality of services.
Besides these very recently the bank has honored two national and international awards.
These are given below:
International Award-The Bank of the year-2011 in Bangladesh
Janata Bank Limited has been awarded „The Bank of the Year-2011 in Bangladesh‟ by the
London based Financial Magazine the Banker of the Financial Times Group. This is for the
sixth time the bank has been awarded „The Bank of the Year‟. Janata Bank Limited achieved
remarkable progress in the year 2010.

JANATA BANK LIMITED
ICMAB Best Corporate Award-2011
Janata Bank Limited has been awarded 'ICMAB Best Corporate 1Award - 2011' by the
Institute of Cost and Management Accountants of Bangladesh. The Bank secured the first
position among the state owned Commercial Banks in Bangladesh.
2.13 Future Plans of the Organization
 Involvement in export activity largely by maintaining good communication with

diverse parties.
 More facilities will be provided to the exporters on the basis of export priority and
facilitate them on the basis of performance.
 Sufficient workforce has involved increasing export and import business, providing
special services and initiated different training program of officers has been started.
 Very dynamic new dimensional Credit Product will be started in a large scale.
 To take the competitive position charge, decrease commission and other facilities will
continue to complete the journey

JANATA BANK LIMITED
Chapter 3
Foreign Exchange Division

JANATA BANK LIMITED
3.1 Foreign Exchange

Foreign exchange is an important and integral part of commercial banking. It is very much
Lucrative and remunerative operation for the bank, if it is conducted systematically and
methodically as per norms. In order to conduct Foreign Exchange Activities systematically
and methodically the Foreign Exchange Regulation (FER) Act, 1947 enacted on the 11
March 1947 in the British- India provides the legal basis for regulating receipts and payments
and dealings in the foreign exchange and securities. Basic regulations for conducting Foreign
Exchange Operation are issued by the Government as well as by the Bangladesh Bank in the
form of Public notice, circulars, SROs etc. From time to time Authorized Dealers (Ads) in
Foreign Exchange should meticulously follow the said circulars and guidelines of Bangladesh
Bank
3.2 Meaning of Foreign Exchange

Foreign Exchange means the exchange of currency in terms of goods includes all deposits,
credits, balance payable, drafts, T.Cs, bill of exchange, L/C etc. from one country to another.
This is the most well-known and well-organized business uniform in world business. All
foreign exchange transactions in Bangladesh are subject to exchange control regulation of
Bangladesh Bank.
Among all departments Foreign Exchange departments of Janata Bank Ltd is one of the most
important. The Bank is providing excellent services to the clientele in foreign exchange and
foreign trade operations through the above foreign correspondents.
3.3 Necessity of Foreign Exchange

No country self-sufficient in this world. Everyone is, more or less dependent on other, for
goods or services. Say, Bangladesh has cheap manpower whereas Saudi Arabia has cheap
petroleum. So, Bangladesh is dependent on Saudi Arabia for petroleum and Saudi Arabia is
dependent on Bangladesh for cheap manpower. People of one country are going to abroad for
medical service, education etc. thus there is an exchange of foreign currency.

JANATA BANK LIMITED
3.4 Activities of Foreign Exchange Division
Activities of Foreign Exchange Division can be broadly divided into three parts:
1. Export
2. Import
3. Remittance
Figure 5: Activities of Foreign Exchange Division
3.5 Regulation for Foreign Exchange Division
Foreign Exchange transactions are being controlled by the following rules and regulations:
3.5.1 Local Regulation
 Foreign Exchange act 1047.

 Bangladesh bank issues Foreign Exchange Circular from time to time to control the
export, import and remittance operation.
 Ministry of commerce issues export and import policies giving basic formalities for
import and export.
 Sometimes CCI issues public notices for any kind of change in Foreign Exchange
transaction.
 Bangladesh bank publishes two volumes in 1996. These comprise the complete
instructions to be followed by the authorized dealers in transactions related to Foreign
Exchange.

JANATA BANK LIMITED
3.5.2 International Regulation
There are some international organizations influencing our Foreign Exchange transactions.
These are:
 International chambers of Commerce (ICC) is a worldwide non-governmental
organization of the thousands of companies. It was founded in 1919. ICC has been
issued some publication like UCPDC, URC and URR etc, which are being followed
by all the member countries. There is also International Court of Arbitration to solve
the international business disputes.
 World Trade Organization (WTO) is another international trade organization

established in 1995. General Agreement on Tariff and Trade (GATT) was established
in 1948, after completion 8th round the organization has been abolished and replaced
by WTO. This organization has role in international trade, through its 124 member
countries.
3.6 How Foreign Exchange is being Controlled

Foreign Exchange is being controlled by the following ways:
 To stabilize the rate of exchange
 To protect domestic industries
 For proper implementation of plans
 To increase the bargaining strength
 To check over invoicing & Under invoicing
 To check the Blank marketing and smuggling
 For regulating the international movements of goods
3.7 Foreign Exchange Performance of JBL

1. Import: The Bank‟s foreign exchange business relating to import was Tk.118525 million
in 2009 and Tk. 183744 million in2010.
2. Export: The Bank‟s foreign exchange business relating to export was Tk.88653 million in
2009 and Tk.118515 in 2010.
3. Foreign Remittance: The achievement JBL in attracting foreign remittance was Tk.56190
million in 2009 and Tk.52640 in 2010.

JANATA BANK LIMITED
3.7.1 Foreign Exchange Performance of JBL from 2009-2010
(Figure in million TK.)
Particulars Year
2009 2010
Import 118525 183744
Export 88653 118515
Foreign Remittance 56190 52640
Foreign Exchange Business of JBL
200000
180000
160000
Figure in million
140000
120000
100000
80000
60000
40000
20000
0
2009 2010
Import 118525 183744
Export 88653 118515
Foreign Remittance 56190 52640

Graph 1: Foreign Exchange Performance of JBL
Explanation: The above graph shows the foreign exchange earnings regarding to import,
export and foreign remittance. In 2010 the import earnings was TK. 183744 million with
growth rate of 55.02%, export earnings was TK.118515 million with growth rate of 33.68%
and the foreign remittance earnings was TK. 52640 million with growth rate of (-) 6.32%
compare to 2009.

JANATA BANK LIMITED
3.8 Risk Management of Foreign Exchange Activities

Foreign exchange risk is a risk that a bank may suffer losses as a result of adverse movement
in either spot or forward rate or combination of the two, in individual foreign currency. This
risk is associated with the transaction involved in import, export, remittance and foreign
currency in hand and bank.
To mitigate the risk involved in foreign exchange business, the foreign exchange dealing
operation in Janata Bank Limited is performed through Dealing Room(Front Office) ,Mid
Office and Back Office. The dealers manage market risk, avoid adverse exchange fluctuation,
look for better investment of funds, maintain sound liquidity and protect the Bank from any
unforeseen loss in the situation of any market volatility. The Mid Office and Back Office are
assigned the responsibility of related support functions. Dealing room is restricted for all
excepting dealers and authorized executives.
The dealing room is equipped with modern facilities i.e. Reuters‟s information, SWIFT,
receptors monitor, telephone, voice recorder etc. Moreover stop/ loss limit, trading limit,
overnight limit is given by the concerned authorities. The daily blotter and mark to market
revaluation report is placed to management for their review.

JANATA BANK LIMITED
Chapter 4
Activities of Letter of credit (L/C)

JANATA BANK LIMITED
4.1 Letter of credit (L/C)

Letter of credit (L/C) can be defined as a “Credit Contract” whereby the buyer‟s bank is
committed (on behalf of the buyer) to place an agreed amount of money at the seller‟s
disposal under some agreed conditions. L/C is called documentary letter of Credit because the
undertaking of the issuing bank is subject to presentation of some specified documents. The
Uniform Customs & Practices for Documentary Credit (UCPDC) published by International
Chamber of Commerce (1993) Revision Publication No. 500 defines Documentary Credit:
Any arrangement however named or described whereby banks (the issuing bank”) acting at
the request and on the instructions of a customer (the “Applicant”) or on its own behalf:
1. Is to make a payment or to the order of a third party(the beneficiary) or is to accept

and pay bills of exchange(Drafts)drawn by the beneficiary, or
2. Authorizes another bank to effect such payment or to accept and pay such bills of
exchange (Drafts)
3. Authorizes another bank to negotiate against stipulated documents provide that terms
and conditions are complied with.
4.2 Types of L/C

Letter of Credit basically divided into two types:
Letter of Credit
Revocable L/C Irrevocable L/C
Figure 6: Types of Letter of Credit
1. Revocable L\C
Revocable L\C is a credit which can be amended/ cancelled by issuing bank, without
prior notice to the seller.
2. Irrevocable L/C
Irrevocable L/C is a credit, which cannot be amended or cancelled without the
agreement of all parties.

JANATA BANK LIMITED
Some other types of L\C s are:
 Confirmed L\C.
 Transferable L\C.
 Confirmed L\C.
 Revolving L\C.
 Restricted L\C.
 Red Clause L\C.
 Green Clause L\C.
 Back-to-Back L\C.
4.3 Letter of Credit Transaction
(6) Documents forwarded to issuing

bank to authorize payment
Advising (2) L/C

Issuing Bank
Bank
(5) Freight (8) Importer‟s

forwarder (3) Advises accounting is
presents exporter of L/C debited (or
documents to (1) Application financed) and
bank payment documents are
release.
(4) Freight forwarder ships and

Exporter Merchandise Importer
(7) Payment
Figure 8: Letter of Credit Transaction process
Figure 7: Letter of Credit Transaction Process

JANATA BANK LIMITED
4.4 Parties involved in the L/C

 Importer/Applicant
Applicant who is referred to as account party is normally a buyer or customer of the
goods, who has to make payment to beneficiary. Simply the person applies for L/C is
called importer.
 Exporter (Beneficiary)
Beneficiary of the L/C is the party in whose favor the letter of credit is issued. Usually
they are the seller or exporter.
 Issuing Bank
It is the bank which opens/issues a L/C on behalf of the Importer.
 Confirming Bank
It is the bank, which adds its confirmation to the credit and it is done at the request of
issuing bank. Confirming bank may or may not be advising bank.
 Advising /Notifying Bank
It is the bank through which the L/C is advised to the exporters. This bank is actually
situated in exporter's country. It may also assume the role of confirming and /or
negotiating bank depending upon the condition of the credit.
 Negotiating Bank
It is the bank, which negotiates the bill and pays the amount of the beneficiary. The
advising bank and the negotiating bank may or may not be the same. Sometimes it can
also be confirming bank.
 Accepting Bank
It is the bank on which the bill will be drawn (as per condition of the credit). Usually
it is the issuing bank
 Reimbursing Bank
It is the bank, which would reimburse the negotiating bank after getting payment -
instructions from issuing bank.
4.5 Basic Procedures for Opening a Letter of Credit (L/C)
In global business environment buyers and sellers are often unknown to each other. So seller
generally demands guarantee of payment for his exported goods. In this situation bank has an
important role. Bank gives export guarantee that it will pay for the goods on behalf of the
buyer. This guarantee is called “Letter of Credit” or L/C. Thus by letter of credit the contract
between importer and exporter find a legal sphere.
The letter of credit process has been standardized by a set of rules published by the
International Chamber of Commerce (ICC). These rules are called the Uniform Customers
and Practice for Documentary Credits (UCPDC) and are contained in ICC publication No.
JANATA BANK LIMITED
500. The following is the basic set of steps used in L/C transaction. Specific L/C transaction
follows somewhat different procedures.
1. After the buyer and seller agree on the terms of sale, the buyer arranges for his bank
to open a L/C in favor of the seller.
2. The buyer issuing bank prepares the L/C, including all of the buyer‟s instructions to
the seller concerning shipment and required documentation.
3. The buyer‟s bank sends the L/C to seller‟s advising bank.
4. The seller‟s advising bank forwards the L/C to the seller.
5. The seller carefully reviews all conditions stipulated in the L/C. If the seller can not
comply with any of the provisions, it will asked the buyer to amend the L/C
6. After final terms are agreed upon, the seller ships the goods to the appropriate port or
location.
7. After shipping the goods seller obtains the required documents.
8. The seller presents documents to its advising bank along with a draft for payment.
9. The seller‟s advising bank reviews the documents. If they are in order, it will forward
them to the buyer‟s issuing bank. If a confirmed L/C, the advising bank will pay the
seller.
10. Once the buyer‟s issuing bank receives and reviews the documents, if either pays if
there are no discrepancies or forwards the documents to the buyer if there are
discrepancies for its review and approval.
4.6 L/C Application Form (L/CAF)

L/C Application Form is a sort of an agreement between customer and bank on the basis of
which letter of credit is opened. Bank provides a printed form for opening of L/C to the
importer. A special adhesive stamp of value Tk.200 is affixed on the form in accordance with
Stamp Act currently in force. While opening, the stamps are cancelled. Usually the importer
expresses his decision to open the L/C quoting the amount of margin in percentage. Usually
the importer gives the following information –
1. Full name and address of the importer

2. Full name and address of the beneficiary
3. Draft amount
4. Availability of the credit by sight payment/ acceptance/ negotiation/ deferred payment
5. Time bar within which the documents should be presented
6. Sales type (CIF/FOB/C&F)
7. Brief specification of commodities, price, quantity, indent no. etc.
8. Country of origin
9. Bangladesh Bank registration no.
10. Import License/LCAF no.
JANATA BANK LIMITED
11. IRC no.

12. Account no.
13. Documents no.
14. Insurance Cover Note/Policy no., date, amount
15. Name and address of Insurance Company
16. Whether the partial shipment is allowed or not
17. Whether the transshipment is allowed or not
18. Last date of shipment
19. Last date of negotiation
20. Other terms and conditions (if any)
21. Whether the confirmation of the credit is requested by the beneficiary or not
22. The L/C application must be completed/filled in properly and signed by the
authorized person of the importer before it is submitted to the issuing bank
4.7 Letter of Credit-Settlement

Settlement means fulfilling the commitment of issuing bank in regard to effecting payment
subject to satisfying the credit terms. Settlement may be done under 3 (Three) separate
arrangements as stipulated in the Credit.
 Settlement by Payment
Here the seller presents the documents to the nominated bank and bank scrutiny the
documents. If satisfies, the nominated bank makes payments to the beneficiary and incase
this bank is other than the issuing bank, then sends the documents to issuing bank and claim
reimbursement as per arrangement.
 Settlement by Acceptance
Under this arrangement the seller submits the documents evidencing the shipment to the
accepting bank (nominated by the issuing bank for acceptance) accompanied by a draft and
bank at the specified tenor.
After being satisfied with the documents, the bank accepts the documents and the drafts and
if it is a bank other than issuing bank, then se4nds the documents to the issuing bank stating
that it has accepted the draft and at maturity the reimbursement will be obtained in the pre-
agreed manner.
 Settlement by Negotiation
This settlement proceeds with the submission of the documents by the seller to negotiating
bank. In a freely negotiable credit any bank can negotiate documents and if negotiation
restricted by the issuing bank, only nominated bank can negotiate the documents. After
scrutinizing that the documents meet the credit requirements, the bank can negotiate the
documents and give the value to beneficiary. The negotiation bank then sends the documents
to the issuing bank. As, usual the reimburse4mentwill be obtained in the pre-agreed manner.

JANATA BANK LIMITED
Chapter 5
Import Section

JANATA BANK LIMITED
5.1 Meaning of Import

Simply import means purchase of goods or services from abroad. Again an import is any
goods or services brought into a country from another country in a fair and acceptable
fashion, typically for use in trade. Normally consumers, firms and Government organizations
import foreign goods or services to meet their various necessities. Main import items are food
item, edible oil, fertilizer, petroleum, machineries, chemicals, raw materials of industry,
cement clinkers etc. So, in brief, we can say that import is the flow of goods and services
purchased by local agent staying in the country from foreign agent staying abroad. The
importers are asked by their exporters to open Letter of Credits (L\C), so that their payment
against goods is more insured.
5.2 Import Department

Bangladesh is one of the developing countries in the world. So, like other developing
countries Bangladesh Imports largely than it Exports. Imports of goods into the Bangladesh is
regulated by the Ministry of Commerce in the terms of the Import- Export Act, 1950, various
Import policy orders and also public notices issued from time to time by the office of the
Chief Controller of Import and Export (CCI&E).
JBL‟s foreign exchange business relating to import was Tk.183744 million at the ends of
December 2010.
5.3 Import Policy

Different import policy
 Import facility up to $2000 for actual user (for self-consumption not for sale) without
permission.
 Above $5000 approval of Chief Controller of Import and Export (CCI&E) is needed.
Import facility on the basis of direct payment on foreign countries

 Import under L\C, L\C must be irrevocable. Import above $5000-L\C is required but
in the case of perishable items like food up to $7500 transported by road L\C is not
required.
 Some other cases in which do not require L\C, are:
 Books, Magazines, Publications.

 Import up to $5000 in case of payment from Bangladesh.
 Import under Foreign Aid.
 Import of "International Chemical Conference" by the Pharmaceutical Companies
with prior approval Drug Administration.
 Government sector bodies can import without any license, permit &b IRC (Import
Registration Certificate).

JANATA BANK LIMITED
5.4 Import Procedures

Authorized Dealer, banks are always committed to facilitate import of different goods into
Bangladesh from the foreign countries. Import Section, which is under Foreign Exchange
Department of a bank, is assigned to perform this job. And to serve its parties demand to
import goods, it always maintains required formalities that are collectively termed as “Import
Procedure”.
1. At first, the importer must obtain Import Registration Certificate (IRC) from the
CCI&E submitting the following papers:
 Up to date Trade License.
 National and Asset Certificate.
 Tax Identification Number (TIN )
 In case of company, Memorandum & Articles of Association and Certificate of
Incorporation.
 Bank Solvency Certificate etc.
 Required amount of registration fee
2. Then the importer has to contact with the seller outside the country to obtain the
Proforma Invoice. Usually an indenter, local agent of the seller or foreign agent of the
buyer makes this communication. Beside these other sources are:
 Trade fair.
 Chamber of Commerce.
 Foreign Missions in Bangladesh.
 Journals etc.
3. When the importer accepts the Proforma Invoice, he/she makes a purchase contract
with the exporter detailing the terms and conditions of the import.
4. After making the purchase contract, importer settles the means of payment with the
seller. An import procedure differs with different means of payment. The possible
means are Cash in Advance, Open Account, Collection Method and Documentary
Letter of Credit. In most cases, the Documentary Letter of Credit in our country
makes import payment. Purchase Contract contains which payment procedure has to
be applied.
5.5 Import Mechanism

To Import, a person should be competent to be importer. According to Import and Export
Control Act-1950, the office of Chief Controller of the Import and Export (CCI&E), provides
the registration (IRC) to the importer. After obtaining thus person's has to secure a letter of
Credit authorization from Bangladesh bank. And then a person becomes a qualified importer.
He is the person who requires or instructs the opening bank to open a L\C. He is also called
Opener or Applicant of the credit.
5.6 Types of Import

Mainly there are two types of import:
1. Commercial Import
2. Industrial import

JANATA BANK LIMITED
1. Commercial Import:
Importer does commercial import only for trading purpose. These products are finished
goods. Such as rice, wheat, soybean oil etc.
2. Industrial import:
Importer does industrial import for industrial use only. These products are raw materials
and capital machinery. Such as; raw cotton, Crude oil etc.
5.7 Goods are not Importable

The following types of goods are not importable:
 Books, Newspaper, periodicals, documents and other papers, posters photographs,
films, gramophone records, audio and video cassette tapes etc containing matters
likely to outrange the religious feeling and beliefs of any class of the citizen of
Bangladesh.
 Maps, chart and geographical globes which indicate the territory of Bangladesh but do
not do so in accordance with the maps published by the department of survey,
Government of the people‟s republic of Bangladesh.
 Reconditioned office equipment, photocopier, type-writer machine, telex, phone,
computer and fax.
 Goods bearing any obscene picture, writing inscription or visible representation.
5.8 Import Financing

There is various method of Import Financing, which is regulated by legal framework and
import policy. These are:
1. Non-Funded Financing
2. Post import (funded) Financing
1. Non-Funded Financing
Letter of Credit constitutes the most important Non-Funded Financing in import trade. There
are a very common form of import financing because they provide a high degree of protection
for both buyer and seller.
2. Post import (funded) Financing
There are major three forms of funded post import financing offered by the banks.
These are given below-
a) Payment Against Documents (PAD)

b) Loan Against Imported Merchandise (LIM)
c) Loan Against Trust Receipt (LTR)

JANATA BANK LIMITED
a)Payment against Documents (PAD)
Payment made by the bank against lodgment of shipping documents of goods imported through
letter of credit falls under this types. When importer bank finds documents in order and if there
is any discrepancies have which is acceptable by the importer, import bill have to give to
foreign bank or exporter bank.
b)Loan against Imported Merchandise (LIM)

This is funded credit facility allowed for retirement of shipping documents and release of
goods imported through L/C taking effect control over the goods by pledge in god owns
under bank‟s lock and key. This is a temporary advance connected with import which is
known as post-import finance and falls under the category “Commercial Lending”.
c) Loan against Trust Receipt (LTR)

JBL keeps security (such as –land, Building etc) against LTR. Party can replay LTR amount
partial. JBL maintains a different ledger account for LTR in which several information have
such as date, particular, debit and credit amount, initial, product name, interest amount, loan
A/C no, interest rate, mode of payment, expiry date and margin etc. LTR interest rate varies
party to party. LTR validity date may be 30 days/ 60 days/ 120 days, which depends on
sanction of NBL head office.
LTR interest rate = Days × Balance × Rate of interest / 360 days.
5.9 Documents Receipt and Scrutiny
After opening the Letter of Credit the next step would be to await shipment followed by
negotiation of documents by a bank abroad.
However, generally the following documents are asked to send:
 Bill of lading or Airway Bill or other evidence of shipment (e.g. Railway Receipt,
Truck Receipt, Barge Receipt)
 Certificate of Origin
 Commercial Invoice
 Draft or bill of exchange
 Inspection of Survey Certificate
 Marine Insurance Policy
 Packing List
 Quality Control Certificate

JANATA BANK LIMITED
5.10 Graphical Presentation and Discussion of Import

5.10.1 Import performance of JBL
Achievement from Import

Year 2008 2009 2010
Import 129413 118525 183744
Import Performance Of JBL from 2008-2010
200000
180000
160000
140000
Figure in million
120000
100000
80000
60000
40000
20000
0
2008 2009 2010
Achieved 129413 118525 183744
Graph 2 : Import performance of JBL
Explanation: The graph shows that the import performance of JBL from 2008-2010. In this
section TK.10888 million decreased from 2008-2009 with a negative growth rate of -11%
and TK.65219 million increased from 2009-2010 with a growth rate of 55.02%.

JANATA BANK LIMITED
5.10.2 Import Performance of JBL, Kawran Bazar Corporate Branch
Achievement against Target

Year 2008 2009 2010 2011
Target 14.49 20.7 20 90
Achievement 15.75 22.5 79.5 57.6

100
90
80
70
60
Figure in million
50
40
30
20
10
0
2008 2009 2010 2011
Target 14.49 20.7 20 90
Achieved 15.75 22.5 79.5 57.6
Source: JBL, Kawran Bazar Corporate Branch.
Graph 3: Import Performance of JBL, Kawran Bazar Corporate Branch
Explanation: The graph shows that the amount of achievement against target of Kawran
Bazar Corporate Branch from 2008-2011. In 2008 the achievement was TK.15.75 million
against target TK.14.49 million. In 2009 the achievement was TK.22.5 million against target
TK.20.7 million. In 2010 the achievement was TK.79.5 million against target TK.20.million
and in 2011 the achievement was TK.57.6 million against target TK.90 million.

JANATA BANK LIMITED
5.10.3 Increase or (Decrease) of Import Percentage (%) of JBL, Kawran Bazar

Corporate Branch.
Increase or (Decrease) of Import Percentage (%) During

Year 2009 2010 2011
Percentage Achieved 43% 253% (-)28%
Increase or (Decrease) in Percentage (%) During 2009-2011
300%
250%
200%
150%
100%
50%
0%
-50%
2009 2010 2011
Percentage Achieved 43% 253% -28%
Graph 4: Import Growth Percentage (%) of JBL, Kawran Bazar Corporate Branch.
Explanation: The graph shows the data of import percentage of JBL, Kawran Bazar
Corporate Branch. In 2009, 2010, and 2011 the percentage was respectively 43%, 253%, and
-28%. But here the percentage in 2011 was lower than the previous years, which is bad for
the branch.

JANATA BANK LIMITED
Chapter 6
Export Section

JANATA BANK LIMITED
6.1 Meaning of Export

The goods and services sold by Bangladesh to foreign households, businessmen and
Government are called export. Main export items are readymade garments, frozen fish,
vegetables, tea, coffee, spices etc.
6.2 Export Department

The export trade of the country is regulated by the Imports and Exports (control) Act, 1950.
There are a number of formalities, which an exporter has to fulfill before and after shipment
of goods. The exports from Bangladesh are subject to export trade control exercised by the
Ministry Of Commerce through Chief Controller of Imports and Exports (CCI & E). No
exporter is allowed to export any commodity permissible for export from Bangladesh unless
he is registered with CCI & E and holds valid Export Registration Certificate (ERC). The
ERC is required to be renewed every year. The ERC number is to be incorporated on EXP
forms and other documents connected with exports.
The major function of this section is comprises with purchases, collection & negotiate the
export bill, provide the exporter in financing and helps the exporter in different issues.
A person desire to export should make application to obtain ERC (Export Registration
Certificate) from CCI&E then the person should step in to a bank along with ERC to obtain
export operation from the Bank.
Government of Bangladesh gives many facilities for the exporters. Such as-
 Income tax exemption for export earning: Under the income tax law other than the
owners of factories not registered in Bangladeshi, all exporters will get 50%
exemptions in their income taxes.
 Exemption in insurance premium.
 Bond facilities for export oriented industries.
 Facilities for duty free import
 of capital machineries for export - oriented industries.
 The export-oriented industries will get the advantage of importing 10 percent
spare parts of their capital machineries without duty in every two years.
 Providing alternative facilities to export-oriented local textiles and RMG other
than duty-bond or duty-draw-back.
 Tax holiday.
 Duty-draw-back scheme.
6.3 Documents used in Export

When a firm sells its goods abroad, it must arrange for each export shipment to be
accompanied by various documents. Depending on the country to which the goods are being
sent, these documents will vary. But for exporting we can divide those documents in two
types-
 6.3.1 Substantive Documents
 6.3.2 Auxiliary Documents
JANATA BANK LIMITED
6.3.1 Substantive Document

Substantive Documents are given below:
 Draft or bill of exchange

Bill of Exchange is an instrument in writing containing an unconditional order or at a
fixed determinable future time a certain sum of money only to, or to the order of a
certain person or to the bearer of the instrument.
 Commercial Invoice
Commercial Invoice is the export firm's invoice, addressed to the foreign importer describing
the goods shipped and the total price that it must pay. However, some countries require the
commercial invoice to be prepared on their own forms. Such forms are called customs
invoices.
 Bill of lading or Airway Bill

Bill of Lading is a document supplied to the exporter by the shipping company that is
transporting the goods to their foreign destination, listing, item by item, the goods
being shipped. It serves three basic purposes:
a) To acknowledge receipt by the carrier of the exporter's goods.

b) To indicate the carrier's contractual obligation to transport the goods to their
destination in exchange for payment.
c) To record transfer of title from the seller to the buyer when payment for the goods
takes place. Airlines use what is called an Air Waybill.
6.3.2 Auxiliary Documents
Auxiliary Documents are given below:
 Cargo manifest or packing list

When quantities, weights or contents of the various packing cases in an export
shipment vary, it is usual to prepare a separate list for each case indicating its
contents, weight and measurements.
 Certificate of Origin
Certificate of Origin is a document, which indicates the country in which the goods
were produced, is required whenever preferential duties are claimed. Sometime,
consular legalization of the document is necessary. Also, certification of the document
by a Chamber of Commerce is required.
 Quality control certificate
While exporting products for which quality control certificate is obligatory, the
exporter will have to submit, to the Customs Authorities, a quality control certificate
issued by the appropriate authority.

JANATA BANK LIMITED
 Consular Invoice
Some country required consular invoice. Countries that require a consular invoice also
require a commercial invoice as additional proof of the details of the export shipment.
 Certificate of free sale
This certificate required for pharmaceuticals and certain chemicals entering a number
of countries.
 Export Declaration Forms
It is usually necessary for the exporter wishing to ship goods abroad, to fill out a form
called an Export Declaration. The document is also used for statistical purposes so
that government authorities know exactly what has been exported from the country in
each month and year and to which country
6.4 Registration for the Exporter

In the export policy of Bangladesh any one can not export goods in abroad. To export goods
an exporter needs a valid Export Registration Certificate from the Chief Controller of Import
and Export (CCI&E). Exporters find an Export Registration Certificate (ERC) number which
is incorporate on Export form and papers connected for obtaining Export Registration
Certificate-
 National ID card
 Memorandum and Article of Association and Certificate of Incorporation in case of
limited company
 Trade license
 Bank Certificate
 Assets certificate
 Income Tax certificate etc.
6.5 Formalities and procedures of export L/C
The formalities and procedure of export L/C‟s are as follows:
 Obtaining exports LC:

To get export LC form exporter issued by the importer.
 Submission of export documents:
Exporter has to submit all necessary documents to the collecting bank after shipment.
 Checking of export documents:
After getting the documents banker used to check the documents as per LC terms
 Negotiation of export documents:
If the hank accepts the document and pays the value draft to the exporter and forward
the document to issuing bank that is called a negotiating bank. If the bank does buy
the LC then the bank normally acts as collecting bank.
JANATA BANK LIMITED
 Realization of proceeds:
This is the period when the issuing bank has realized the payment.
 Reporting to the Bangladesh bank:
As per instruction by Bangladesh Bank the bank has to report to respective
department of Bangladesh bank by mentioning latest payment.
 Issue to proceeds realization certificate (PRC):
Bank has to issue precede realization certificate of export LC to the supplier / exporter
for getting cash assistance.
6.6 Export Financing

To meet up the cost of goods to be exported, the exporter may require Bank finance. Besides,
he may require finance for go down rent, freight etc. Even after shipment of the goods,
exporter may require Bank finance to meet-up his expenditure up o repatriation of the export
proceeds. There are two type of export finance:
 6.6.1 Pre-shipment finance

 6.6.2 Post -shipment finance
6.6.1 Pre Shipment Finance in Export Trade
Pre Shipment Finance is issued by a financial institution when the seller wants the payment
of the goods before shipment. The main objectives behind pre shipment finance or pre export
finance are to enable exporter to:
 Procure raw materials.
 Carry out manufacturing process.
 Ship the goods to the buyers.
 Meet other financial cost of the business.
Types of Pre Shipment Finance
a) Packing Credit
b) Advance against Cheques/Draft received as Advance Payments
c) Back to back L/C
a) Packing Credit:
Packing Credit is any loan or advance granted or any other credit provided by a bank to an
exporter for financing the purchase, processing, manufacturing or packing of goods prior to

JANATA BANK LIMITED
shipment, on the basis of letter of credit opened in his favor or in favor of some other person,
by an overseas buyer or a confirmed and irrevocable order for the export of goods from the
producing country or any other evidence of an order for export from that country having been
placed on the exporter or some other person, unless lodgment of export orders or letter of
credit with the bank has been waived.
b) Advance against Cheque/Drafts received as advance payment:

Where exporters receive direct payments from abroad by means of cheques/drafts etc. the
bank may grant export credit at confessional rate to the exporters of goods track record, till
the time of realization of the proceeds of the cheque or draft etc. The Banks however, must
satisfy themselves that the proceeds are against an export order.
C) Back to back L/C:

Back-to-back L/C means one credit backs another credit. It is new credit in favor of another
beneficiary. Besides, the normal formalities and requirements (for L/C opening) the
following formalities and documents are also required for opening back-to-back L/C:
1) Master L/C
2) Valid bonded ware house license
3) Quota allocation for quota items
4) ERC in addition to IRC
5) Indemnity
6) No objection from previous banker (if any)
7) Factory inspection certificate
8) BGMEA Membership
Vouchers and accounting treatments are the same normal L/C opening except margin. In this
case, no margin is taken by the bank. After lodgment, maturity date of the import bill is
intimated to foreign bank as per L/C terms.
Establishing Back to Back L/C

How whole process works are given below:
Issue of original L/C:
In documentary credit operations buyer (i.e. the applicant) arranges to establish the (original)
credit through a bank (the issuing bank or the opener) in favour of the seller (the beneficiary).

JANATA BANK LIMITED
Issue of Back-to-Back L/C:

A back-to-back credit is established when the seller-cum-original-beneficiary, after receiving
the notification about the issue of the original credit, arranges for a second, stand-alone credit
to be established in favor of the (actual) supplier or manufacturer of goods or raw materials.
No formal connection between the two L/C:
Please be careful to note that there is no legal or formal connection between the original, L/C
and the Back-to-Back Credit. Each credit stands on its own merit.
Back-to-Back L/C can be opened as a chain:
If there are several middlemen (or any manufacturers who must again procure input materials
from other manufacturers), each may use the credit in his favor as security for the credit that
he has to open in favor of his supplier in the chain of contracts, until first buyer in the chain
has effectively opened a credit in favor of original supplier.
6.6.2 Post Shipment Finance
Post shipment finance is a kind of loan provided by a financial institution to an exporter or
seller against a shipment that has already been made. This type of export finance is granted
from the date of extending the credit after shipment of the goods to the realization date of the
exporter proceeds. Exporters don't wait for the importer to deposit the funds.
Basic Features
The features of post-shipment finance are:
 Post-shipment finance is meant to finance export sales receivable after the date of
shipment of goods to the date of realization of exports proceeds. In cases of deemed
exports, it is extended to finance receivable against supplies made to designated
agencies.
 A post-shipment finance is provided against evidence of shipment of goods or
supplies made to the importer or seller or any other designated agency.
 Post -shipment finance can be secured or unsecured. Since the finance is extended
against evidence of export shipment and bank obtains the documents of title of goods,
the finance is normally self-liquidating.
 Post-shipment finance can be of short terms or long term, depending on the payment
terms offered by the exporter to the overseas importer.
In case of cash exports, the maximum period allowed for realization of exports proceeds is
six months from the date of shipment. Concessive rate of interest is available for a highest
period of 180 days, opening from the date of surrender of documents. Usually, the documents
need to be submitted within 21days from the date of shipment.

JANATA BANK LIMITED
Financing for Various Types of Export Buyer's Credit
Post-shipment finance can be provided for three types of export;

 Physical exports: Finance is provided to the actual exporter or to the exporter in
whose name the trade documents are transferred.
 Deemed export: Finance is provided to the supplier of the goods which are
supplied to the designated agencies.
 Capital goods and project exports: Finance is sometimes extended in the name of
overseas buyer. The disbursal of money is directly made to the domestic exporter.
Types of Post Shipment Finance
The post shipment finance can be classified as:

a) Export Bills purchased/discounted
b) Export Bills negotiated
c) Advance against export bills sent on collection basis
d) Advance against export on consignment basis
e) Advance against undrawn balance on exports
f) Advance against claims of Duty Drawback
a) Export Bills Purchased/ Discounted

Export bills (Non L/C Bills) is used in terms of sale contract/ order may be discounted or
purchased by the banks. It is used in indisputable international trade transactions and the
proper limit has to be sanctioned to the exporter for purchase of export bill facility.
b) Export Bills Negotiated (Bill under L/C):

The risk of payment is less under the LC, as the issuing bank makes sure the payment. The
risk is further reduced, if a bank guarantees the payments by confirming the LC.
However, this arises two major risk factors for the banks:
i. The risk of nonperformance by the exporter, when he is unable to meet his terms
and conditions. In this case, the issuing banks do not honor the letter of credit.
ii. The bank also faces the documentary risk where the issuing bank refuses to honors
its commitment.
c) Advance against Export Bills Sent on Collection Basis:
Bills can only be sent on collection basis, if the bills drawn under LC have some
discrepancies. Sometimes exporter requests the bill to be sent on the collection basis,

JANATA BANK LIMITED
anticipating the strengthening of foreign currency. Banks may allow advance against these
collection bills to an exporter with a confessional rates of interest depending upon the transit
period in case of DP Bills.
d) Advance against Export on Consignments Basis:

Bank may choose to finance when the goods are exported on consignment basis at the risk of
the exporter for sale and eventual payment of sale proceeds to him by the consignee
However, in this case bank instructs the overseas bank to deliver the document only against
trust receipt /undertaking to deliver the sale proceeds by specified date, which should be
within the prescribed date.
e) Advance against Undrawn Balance:

It is a very common practice in export to leave small part undrawn for payment after
adjustment due to difference in rates, weight, quality etc. Banks do finance against the
undrawn balance, if undrawn balance is in conformity with the normal level of balance left
undrawn in the particular line of export, subject to a maximum of 10 percent of the export
value.
f) Advance against Claims of Duty Drawback:

Duty Drawback is a type of discount given to the exporter in his own country. This discount
is given only, if the in-house cost of production is higher in relation to international price.
This type of financial support helps the exporter to fight successfully in the international
markets. In such a situation, banks grants advances to exporters at lower rate of interest for a
maximum period of 90 days. These are granted only if other types of export finance are also
extended to the exporter by the same bank.

JANATA BANK LIMITED
6.7 Graphical Presentation and Discussion of Export

6.7.1 Export performance of JBL
Achievement from Export
Year 2008 2009 2010

Export 85418 88653 118515
Export Performance Of JBL from 2008-2010
120000
100000
80000
Figure in million
60000
40000
20000
0
2008 2009 2010
Export 85418 88653 118515
Graph 5: Export performance of JBL
Explanation: The graph shows that the Export performance of JBL from 2008-2010. In this
section TK.3235 million increased from 2008-2009 with growth rate 3.78% and TK.29862
million increased from 2009-2010 with growth rate 33.68%.

JANATA BANK LIMITED
6.7.2 Export Performance of JBL, Kawran Bazar Corporate Branch


Year 2008 2009 2010 2011
Target 8.4 12 30 60
Achievement 18.69 26.7 65.74 64

70
60
50
Figure in million
40
30
20
10
0
2008 2009 2010 2011
Target 8.4 12 30 60
Achieved 18.69 26.7 65.74 64
Graph 6: Export Performance of JBL, Kawran Bazar Corporate Branch
Explanation: The graph shows that the amount of achievement against target of Kawran
Bazar Corporate Branch from 2008-2011. In 2008 the achievement was TK.18.69 million
against target TK.8.4 million. In 2009 the achievement was TK.26.7 million against target
TK.12 million. In 2010 the achievement was TK.65.74 million against target TK.30.million
and in 2011 the achievement was TK.64 million against target TK.60 million.

JANATA BANK LIMITED
6.7.3 Increase or (Decrease) of Export Percentage (%) of JBL, Kawran Bazar

Corporate Branch.
Increase or (Decrease) of Export Percentage (%) During

Year 2009 2010 2011
Percentage Achieved 43% 146% (-)3%
160%
140%
120%
100%
80%
60%
40%
20%
0%
-20%
2009 2010 2011
Percentage Achieved 43% 146% -3%
Graph 7: Export Growth Percentage (%) of JBL, Kawran Bazar Corporate Branch
Explanation: The graph shows the data of export percentage of JBL, Kawran Bazar
Corporate Branch. In 2009, 2010, and 2011 the percentage was respectively 43%, 146%, and
- 3%. But here the percentage in 2011 was lower than the previous years, which is bad for the
branch.

JANATA BANK LIMITED
Chapter 7
Remittance Section

JANATA BANK LIMITED
7.1 Meaning of Remittance

The word “Remittance” originates from the word “remit” which means to transmit money. In
banking terminology the work “remittance means transfer of fund one place to another. When
money transferred from one country to another is called “Foreign Remittance”
7.2 Foreign Remittance
The basic function of this department are outward and inward remittance of foreign exchange
from one country to another country. In the process of providing this remittance services; it
sells and buys foreign currency. The conversion of one currency into another takes place at an
agreed rate of exchange in where the banker quotes, one for buying and another for selling. In
such transactions the foreign currencies are like any other commodities offered for sales and
purchase, the cost (convention value) being paid by the buyer in home currency, the legal
tender.
7.3 Remittance Services in Janata Bank limited

As Janata Bank limited has a wide network operates 872 branches in national and
international territory, remittance services are available at all branches and foreign
remittances may be sent to any branch by the remitters favoring their beneficiaries.
Janata Bank Limited has correspondent banking relationship with all major banks &
exchange houses located in almost all the cities. Expatriate Bangladeshis may send their hard
earned foreign currencies through those banks & exchange houses or may contact any
renowned banks nearby (where they reside/work) to send their money to their dear ones in
Bangladesh.
Recently Janata Bank Ltd. has launched its Speedy Foreign Remittance Payment System
which enables beneficiaries to receive their money within shortest possible time. The
beneficiary also gets information of remittance through automated SMS. It‟s a secured, easy,
cost effective and speedy way of remittance for the remitter.
Janata bank Ltd. has signed an agreement with Western Union Network to facilitate wide
range of remittance of the globe. Both the organizations make it possible to receive the
money from about 300,000 locations of 200 countries instantly with prevailing mutual
mechanism and workforce.
7.3.1 Janata Bank Ltd deals with foreign remittance activities on behalf other money
transfer company
Janata bank Ltd. has signed an agreement with:

 Western Union Network
 IME Spot Cash
 Placid Express Spot Cash
 Xpress money etc.

JANATA BANK LIMITED
7.4 Types of Remittance

Followings are the types of remittance:
Inward
Inland Remittance
Remittance Outward
Remittance Remittance
activities Inward
Foreign Remittance
Remittance Outward
Remittance
Figure 8: Types of Remittance
7.4.1 Inward Remittances

The term inward remittances includes not only remittances by TT., MT., Drafts etc. but also
purchases of bills, purchases of drafts under travelers letter of credit and purchases of
travelers cheques. Foreign currency notes against which payment is made to the beneficiary
also a part of inward remittances. Thus the following are the Modes of inward remittances:
Modes of Inward Remittance

 Demand Draft (DD)
 Mail Transfers ( MT)
 Telegraphic Transfer (TT)
 Pay Order (PO)
 Travelers Cheque ( TC)
7.4.1.1 Demand Draft (DD)

This is an instrument through which customers money is remitted to another
person/Firm/organization in outstation (outside the clearing house area) form a branch of one
Bank to an outstation branch of the same Bank or to a branch of another Bank (with prior
arrangement between that Bank with the issuing branch).
7.4.1.2 Mail Transfers (MT)

Mail Transfer is an instrument issued by a remitting bank to the paying bank advising in
writing to make payment of certain amount to specific beneficiary.

JANATA BANK LIMITED
Demand
Draft (DD)
Mail Transfer
(MT)
Inward Telegraphic
Remittance Transfer (TT)
Payment
Order (PO)
Travelers
Cheque
Figure 9 : Modes of Inward Remittance
7.4.1.3 Telegraphic Transfer (TT)

A Telegraphic Transfer is a method of remittance, which is effected by the banker through a
coded telegram attested by secret cheek signal, on receipt of which, the paying office pay the
amount to the payee by crediting his account.
7.4.1.4 Pay Order (PO)

A pay order is a written under, issued by a branch of the Bank, to pay a certain sum of money
to a specific person or a bank. It may be said as to be a banker's cheque as it is issued by a
bank and payable by itself.
7.4.1.5 Travelers Cheque (TC)

It is an instrument issued by the Banks/Company‟s payable to the purchaser on presentation.
7.4.2 Outward Remittance

Remittance from our country to foreign countries is called outward foreign remittance. But
Outward Foreign Remittance is highly restricted by the Bangladesh Government. Only some
especial branches can send money from Bangladesh to abroad under Bangladesh Bank‟s rolls
& regulation.
In Janata Bank Ltd. following branches are only responsible and involve with outward
foreign remittance activities:
 Local Office Dhaka.

 Foreign Exchange Branch, Bitul-Mukaram Dhaka.
 Janata Bovon Corporate Dhaka
JANATA BANK LIMITED
Mode of outward remittance

Thus the following are the Modes of outward remittances:
 Demand Draft (DD)

 Mail Transfers ( MT)
 Telegraphic Transfer (TT)
 Pay Order (PO)
 Travelers Cheque ( TC)
 Foreign currency notes.
Demand Draft
(DD)
Mail Transfer
(MT)
Telegraphic
Transfer (TT)
Outward
Remittance
Payment Order
(PO)
Travelers
Cheque
Foreign
currency notes.
Figure 10: Modes of Outward Remittance
7.5 Remittance market in Bangladesh
The remittance market of Bangladesh has been showing a steady growth in terms of incoming
remittance volume. Considering the current macro-economic indicators it seems that this
growth run will continue in the coming years. Central Bank predicts that our annual incoming
foreign remittance will touch $10 billion in the next 3 years. The reasons for such robust
growth can be summarized as:
 Stable macro-economic indicators including GDP growth,

 Steady growth in manpower export specially in the middle east
 Substantial devaluation of the local currency
 Rapid urbanization

JANATA BANK LIMITED
 Development of new remittance corridors in Australia and part of Europe and

Africa
 Increased focus of Central Bank and the Government to channel funds through
formal channels
 Increased competition among financial institution to grab market share
 Aggressive marketing policy adopted by Banks to increase their share of wallet
 Expansion of branch network of various commercial banks
 MFIs involvement in channeling remittance funds in remote areas
 Participation in the UN peace keeping missions
 Anti-Money Laundering rules and regulations came in force
7.6 Problems /Roadblocks in Current Remittance Process
The major roadblocks of a smooth and efficient payment of foreign remittances are as
follows:
 Poor infrastructure in rural and semi-urban economy

 Inadequate reach of private commercial banks within the country
 Massive information asymmetry in the market
 Active „Hundi‟ market
 Inefficiency of financial institutions
 Poorly regulated exchange houses
 Low literacy rate in the country
 Uneven competition among financial institutions
 Lack of investment in IT backbone development for market efficiency
 Absence of a strong central payment gateway for „Straight Though Processing (STP)
of payment services
7.7 Help Desk Related to Foreign Remittance Problem

"To resolve the foreign remittance related problem/complain/enquiry, Janata Bank Limited
has a 'Complain cell' at its Overseas Banking Division, Head Office, Dhaka. All Concerned
are requested to contact at the following address to resolve any problem related to foreign
Remittance.
7.8 Steps Taken for Remittance Process Improvement
Government as well as private sector has undertaken various strategies to make remittance
transfer easier and hassle free. Now, the Nationalized Commercial Banks (NCBs) have some
overseas branches/remittance wings for transferring remittances successfully.
Recently, illegal transfer of money slid down drastically, as Bangladesh Bank (BB) has
stepped up monitoring of such transactions at home. BB so far gave license to 660 exchange
houses to set up offices abroad to facilitate remittance. Local banks are now able to deliver
money to recipients.
JANATA BANK LIMITED
7.9 Graphical Presentation and Discussion of Foreign Remittance

7.9.1 Foreign Remittance performance of JBL
Achievement from Foreign Remittance

Year 2008 2009 2010
Foreign 45924 56190 52640
Remittance
Foreign Remittance performance of JBL 2008-2009
60000
50000
Figure in million
40000
30000
20000
10000
0
2008 2002009 2010
Series 1 45924 56190 52640
Graph 8: Foreign Remittance performance of JBL
Explanation: The graph shows that the foreign remittance performance of JBL from 2008-
2010. In this section TK.10266 million increased from 2008-2009 with a growth rate of
22.35% and TK.3350 million decreased from 2009-2010 with a negative growth rate of (-)
6.32%.

JANATA BANK LIMITED
7.9.2 Foreign Remittance Performance of JBL, Kawran Bazar Corporate Branch
Year 2008 2009 2010 2011

Target 15.68 22.4 40 60
Achieved 18.83 26.9 45.123 65.8

70
60
50
Figure in million
40
30
20
10
0
2008 2009 2010 2011
Target 15.68 22.4 40 60
Achieved 18.83 26.9 45.123 65.8
Graph 9: Foreign Remittance Performance of JBL, Kawran Bazar Corporate Branch
Explanation: The graph shows that the amount of achievement against target in foreign
remittance of Kawran Bazar Corporate Branch from 2008-2011. In 2008 the achievement
was TK.18.83 million against target TK.15.68 million. In 2009 the achievement was TK.26.9
million against target TK.22.4 million. In 2010 the achievement was TK.45.123 million
against target TK.40.million and in 2011 the achievement was TK.65.8 million against target
TK.60 million.

JANATA BANK LIMITED
7.9.3 Increase or (Decrease) of Foreign Remittance Percentage (%) of JBL, Kawran

Bazar Corporate Branch.
Increase or (Decrease) of Foreign Remittance Percentage (%) During

Year 2009 2010 2011
Percentage Achieved 43% 68% 46%
70%
60%
50%
40%
30%
20%
10%
0%
2009 2010 2011
Achievement Percentage 43% 68% 46%
Graph 10: Growth of Foreign Remittance in Percentage (%) of JBL, Kawran Bazar
Corporate Branch.
Explanation: The graph shows the data of foreign remittance percentage of JBL, Kawran
Bazar Corporate Branch. In 2009, 2010, and 2011 the percentage was respectively 43%, 68%,
and 46%.

JANATA BANK LIMITED
Chapter 8
Findings and Analysis

JANATA BANK LIMITED
8.1 SWOT Analysis

SWOT analysis is very helpful to measure and evaluate a stated objective within a very short
time. Hence this approach has been adopted in this paper. After monitoring closely and
working proactively in the overall banking especially in Foreign Exchange Department of
Janata Bank Ltd. following Strength, Weakness, Opportunity and Threat has been found:
Figure 11: SWOT Analysis
Strengths:
 Second largest bank of the country.

 Strong financial position and sustainable growth.
 Largest portfolio among public banks.
 Wide network of 872 branches including four overseas branches.
 Healthy correspondent relationships with foreign banks.
 Provide a record business in international trade and remittance
 Hold a sound reputation in the banking industries.
 Well-connected distribution channel from head office to all branches.
 Membership with SWIFT
 According to the CAMELS rating Janata Bank Ltd. is one of the top public banks of
Bangladesh. This rating is based on Capital Adequacy, Asset Quality, Management,
Earnings, Liquidity and Sensitivity to market Risk of the bank. Bangladesh Bank
monitors these parameters and publishes the ranking.
 Sound Import and Export operation.
 Speedy Foreign Remittance Payment System.
 Recently Janata Bank Ltd. has gone through an agreement with Western Union
Money Transfer to provide quick and more authentic remittance service to its clients.
 HRD has tried hard to avoid communication barriers & structural bureaucracies.
 JBL also has Management by Objectives (MBO) everywhere.
 Energetic as well as smart team work.
 Relentless in pursuit of business innovation and improvement. It has a reputation as a
partner of consumer growth.
JANATA BANK LIMITED
Weaknesses:
 In Foreign Exchange Division the bank still uses lots of register for maintaining its
foreign exchange transactions. It is time consuming and there are lots of chances for
making mistakes.
 Lack of formal promotional activity in this sector.
 Foreign exchange operations of JBL are less dynamic.
 The important thing is that the bank has no clear strategic plan. The path of the future
should be determined with a strong feasible strategic plan.
 Smart Cards are one of the most popular and emerging products in Bangladesh, which
offers customers total financial mobility.
 There is no customer complain desk in the Bank. It is not only important part of the
foreign exchange activities but also for other departments of the Bank.
 Shortage of trained manpower and logistic support.
 It is noted that “delay in service” is one of the problems faced by the clients.
Opportunities:
 The bank will come under complete computerization very soon.

 The bank is going to launch new software to run banking transactions faster and
smooth.
 The bank tries to cope with the newer trends of foreign exchange as soon as possible.
 JBL should approach more attractive facilities with clear go ahead.
 Expanding the areas of loan disbursement.
 In order to reduce the business risk, JBL has to expand their business portfolio.
 Business expansions in the capital market
 Online banking should be introduced fluently in all branches to compete with
multinational banks.
 JBL should intensify personal banking in order to attract foreign wage earners making
inward remittance through JBL
 New investment sector is booming rapidly. JBL should identified those untapped
areas of business and invest in those sector such as Gas plant, ship breaking etc.
Threats:
 Upcoming banks.
 Overall liquidity crisis in money market.
 Frequent fluctuation of domestic currency worth against US Dollar.
 The laws and customs related to the foreign exchange are changing very rapidly.
 As country‟s export is RMG sector depended, reduce in RMG export has affected
foreign exchange department of the Bank.
 Political crisis and decaying country image as exporter.
 The scenario of International Business is quite dynamic. Newer trends are taking
place time to time. This may create a tension between exporters-importers and the
bankers.

JANATA BANK LIMITED
8.2 Comparison and Performance evaluation of Janata Bank Limited

The study is an attempt to the in-depth analysis of Janata Bank Ltd that helps to identify the
real scenario of the bank and finally makes a recommendation and conclusion as well on the
basis of different dimension.
Comparison with Agrani Bank Ltd and Rupali bank Ltd

In this section I would like to compare Janata Bank Ltd with two other renowned public banks-
Agrani Bank Ltd and Rupali bank Ltd to measure the profit performance. Comparisons are
given below:
8.3 Comparison of profit performance of Janata, Agrani and Rupali Bank

Ltd:
Year
Name of Banks 2009 2010
Janata Bank Ltd 2784.78 4911.64
Agrani Bank Ltd 1355.52 3516.77
Rupali Bank Ltd 1668.49 600.29
Profit Performance
5000
4500
4000
3500
Figure in million
3000
2500
2000
1500
1000
500
0
2009 2010
Janata Bank Ltd 2784.78 4911.64
Agrani Bank Ltd 1355.52 3516.77
Rupali Bank Ltd 1668.49 600.29
Source: Annual Report-2010 of above Bank
Graph 11: Comparison of profit performance of the above Banks

JANATA BANK LIMITED
Explanation: From the above graph we see that the profit performance of Janata Bank Ltd,
Agrani Bank Ltd and Rupali Bank Ltd. Among the three banks JBL achieved the highest
profit in 2009 & 2010. It is a positive sign for JBL.
8.3.1 Increase or (Decrease) of profit percentage from 2009-2010 of Janata,

Agrani and Rupali Bank Ltd.
Name of Banks Increase or (Decrease) Profit percentage (%)
Janata Bank Ltd 76.37%
Agrani Bank Ltd 159.44%
Rupali Bank Ltd (-)64.02%
Profit percentage
200.00%
150.00%
100.00%
Percentage
50.00%
0.00%
-50.00%
-100.00%
Janata Bank Ltd Agrani Bank Rupali Bank Ltd
Ltd
Profit percentage 76.37% 159.44% -64.02%
Source: Annual Report-2010 of above Bank
Graph 12: profit percentage from 2009-2010 of the above banks
Explanation: The graph above shows that the profit percentage of the three banks from
2009-2010. The growth of JBL was 76.37%, Agrani Bank Ltd was 159.44% and Rupai Bank
Ltd was - 64.02%. Among them JBL secured second position.

JANATA BANK LIMITED
8.4 Total Income, Expenditure and Profit Performance of JBL, Kawran

Bazar Corporate Branch
Janata Bank Limited

Particulars 2008 2009 2010 2011

Total Income 61.46 87.8 154.7 309.7
Less Total Expenditure 41.51 59.3 131.1 241.4
Profit 19.95 28.5 23.6 68.3
Total Income, Expenditure and Profit

350
300
Figure in million
250
200
150
100
50
0
2008 2009 2010 2011
Total Income 61.46 87.8 154.7 309.7
Total Expenditure 41.51 59.3 131.1 241.4
Profit 19.95 28.5 23.6 68.3
Graph 13: Total Income, Expenditure and Profit Performance of JBL, Kawran Bazar
Corporate Branch
Explanation: The graph shows that the total income, expenditure and profit performance of
JBL, Kawran Bazar Corporate Branch from 2008-2011. The branch made profit each and
every year but in 2011 it achieved 68.3 million which is highest among the previous years.
That is the big advancement for Kawran Bazar Corporate Branch.

JANATA BANK LIMITED
8.4.1 Increase or (Decrease) of Profit Percentage (%) of JBL, Kawran Bazar Corporate
Branch.
Increase or (Decrease) of Profit Percentage (%) During

Year 2009 2010 2011
Percentage Achieved 43% (-)17% 189%
200%
150%
100%
50%
0%
-50%
2009 2010 2011
Achievement Percentage 43% -17% 189%
Graph 14: Growth of Profit Percentage (%) of JBL, Kawran Bazar Corporate Branch.
Explanation: From the graph we see the data of profit percentage of JBL, Kawran Bazar
Corporate Branch in 2009, 2010, and 2011. The percentage was respectively 43%, -17%, and
189%.
In 2010 the profit percentage of the branch was negative compared to 2009 but in 2011 the
branch came back from the circle of failure and has made a tremendous success.

JANATA BANK LIMITED
8.5 Import Performance of JBL Compare to National Import
Year National Import Import of JBL Contribution %

2007 1272210 84065 6.60%
2008 1635050 129413 7.91%
2009 1844000 118525 6.42%
2010 2115000 183744 8.68%
Import of JBL against Natiional Import
2500000
2000000
Figure in million
1500000
1000000
500000
0
2007 2008 2009 2010
National Import 1272210 1635050 1844000 2115000
Import of JBL 84065 129413 118525 183744
Source: Source: Janata Bank Ltd, Annual Report-2010
Graph 15: Import Performance of JBL Compare to National Import
Explanation: The graph presents the data of national import as well as import of JBL. In
2007 the national import was TK.1272210 million whereas the import was TK.84065 million.
In 2008 the national import was TK.1635050 million whereas the import was TK.129413
million. In 2009 the national import was TK.1844000 million whereas the import was
TK.118525 million and 2010 the national import was TK.2115000 million whereas the
import was TK.183744 million.

JANATA BANK LIMITED
8.5.1 Contribution Percentage of JBL in National Import
Contribution Precentage
9.00%
8.00%
7.00%
6.00%
Percentage
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
2007 2008 2009 2010
Contribution 6.60% 7.91% 6.42% 8.68%
Graph 16: Contribution Percentage of JBL in National Import
Explanation: The graph shows the data of percentage contribution of JBL to national import.
In 2007, 2008, 2009 and 2010 the percentage was respectively 6.60%, 7.91%, 6.42% and
8.68%. But here we notice that the percentage of 2010 was highest among the previous years,
which is good for JBL.

JANATA BANK LIMITED
8.6 Foreign Remittance Performance of JBL Compare to National Foreign

Remittance
Year National Foreign Foreign Remittance Contribution %
Remittance of JBL
2007 451890 36788 8.14%
2008 616442 45924 7.44%
2009 738773 56190 7.60%
2010 802270 52640 6.50%
Foreign Remittance of JBL against Natiional Foreign

Remittance
900000
800000
700000
Figure in million
600000
500000
400000
300000
200000
100000
0
2007 2008 2009 2010
National Foreign Remittance 451890 616442 738773 802270
Foreign Remittance of JBL 36788 45924 56190 52640
Graph 17: Contribution of JBL in National Foreign Remittance
Explanation: The graph presents the data of national remittance as well as remittance of
JBL. In 2007 the national remittance was TK.451890 million whereas the remittance was
TK.36788 million. In 2008 the national remittance was TK.616442 million whereas the
remittance was TK.45924 million. In 2009 the national remittance was TK.738773 million
whereas the remittance was TK.56190 million and 2010 the national remittance was
TK.802270 million whereas the remittance was TK.52640 million.

JANATA BANK LIMITED
8.6.1 Contribution Percentage of JBL in National Foreign Remittance
Contribution Percentage
9.00%
8.00%
7.00%
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
2007 2008 2009 2010
Contribution 8.14% 7.44% 7.60% 6.50%
Graph 18: Contribution Percentage of JBL in National Foreign Remittance
Explanation: The graph shows the data of percentage contribution of JBL to national foreign
remittance. In 2007, 2008, 2009 and 2010 the percentage was respectively 8.14%, 7.44%,
7.60% and 6.50%. But here the percentage of 2010 was lowest among the previous years,
which is bad for JBL.

JANATA BANK LIMITED
8.7 Shortcomings of JBL from my Viewpoint

The bank has many more positive sides. Besides this, there are also some shortcomings and
subsequently recommendations are given below to smooth the banking operation.
Followings are the shortcomings:

 Lack of Modern Banking facilities
 Absence of On-line Banking Services
 Lack of Promotional Activities
 Absence of Information Booth
 Lack of Spread out Mechanism
 Poor Web site
 Insufficient ATM Booth
 Lack of Smart Cards Facilities
 Delay in service
 Poor Customer relationship
 Training Program
 Lack of Efficient Manpower
 Absence of Advanced MIS
 Lack of Innovative Banking Products
 Foreign Exchange Operations is not updated
 Liquidity
 Investment Sector

JANATA BANK LIMITED
Chapter 9
Recommendation and Conclusion

JANATA BANK LIMITED
9.1 Recommendation
 Apply Modern Banking System

Computerized banking system and latest communication device are the most
important elements for banking sector. So, for the sound and stable banking operation
especially foreign exchange operations, JBL has no alternatives but the
modernization.
 Provide On-line Banking Services
The bank should go for mass on-line banking to meet the demand of the next century.
 Decorate Working Environment
Interior decoration should be introduced for client‟s comfort.
 Enhance Promotional Activities
The management should give more emphasis on the advertisement of the bank about their
operations.
 Set up Information Booth
The bank should set up query desk/information booth for better customer services.
 Spread out Mechanism
The spread out mechanism of the bank should be faster and progressive as well.
 Develop Web site of the Bank
The web-site of JBL is not updated. Only a few number of information are given in
the site but some necessary information should be given there such as, how to open an
account, what are the interest rates of different accounts, information about different
products and services.
 Launching ATM Booth
To survive in the cut throat competition, JBL must step into launching more ATM
booth.
 Introduce Smart Cards
JBL should offer international credit card, because in modern world the use of increas
ing paper currencies is decreasing.
 Deliver Faster Service
It is noted that “delay in service” is one of the problems faced by the clients. Attempts
should be made to straighten the banking procedure.
 Improvement of HRM Department

Human resource is another sector for the Foreign Exchange department to be
developed urgently. This department needs to be equipped with adequate computer
based skilled person, so that they can work faster and efficiency can be optimized.
 Recruitment of Efficient Manpower

Efficient manpower should be recruited with having strong academic background of
the related subjects.

JANATA BANK LIMITED
 Arrange Training Program

The bank should try to arrange more training programs for their officials. Quality
training will help the officials to enrich them with more recent knowledge of
International Trade Financing.
 Introduce Advanced MIS

Bank can introduce more advanced MIS to mobilize its day to day activities. It will
help the employees to do their works more quickly and at the same time maintaining
their quality of work.
 Clear Mission and Vision

Employees should be properly learnt about the mission and vision of JBL, thus will
implement their job in that way.
 Enhancement of Remuneration
Proper incentive system should be introduced to motivate bank employees for
rendering better services.
 Offer Various Banking Products
More products of varied interests should be introduced for the diversified client group.
 Steps to Recover Default Loans
Effective and efficient initiatives are necessary to recover the default loans.
 Incentives Package for Exporter
Attractive incentive packages for the exporter will help to increase the export and
accordingly it will diminish the balance of payment gap of JBL.
 Provide Updated foreign market Information
Bank should provide foreign market reports up to date, which will enable the exporter
to evaluate the demand for their products in foreign countries.
 Improve Foreign Exchange Operations
Foreign exchange operations of the bank are less dynamic and more time consuming.
So, JBL should take some initiative to remove the obstacles.
 Enhance the Network of Personal Banking
JBL should explore the possibility of widening its personal banking network in other
countries to tap the inward remittance coming from those countries especially in
Middle East countries where from inward remittances come to Bangladesh in plenty.
 Launch More Branches

The bank can open more branches to reach to more customers.
 Enhance Liquidity
For security of loan and advances JBL should priority for movable and liquid assets.

JANATA BANK LIMITED
 Observe Borrower’s financial condition

The Bank should carefully observe the financial condition and repayment history of
the borrower.
 Involvement of Various Social Programs
To enhance the image of the bank through social responsibility, the bank should engage
itself to various social programs like scholarship to poor but meritorious students, Campaign
against dowry and other social curse.
 Search New Investment Sector

New investment sector is booming rapidly. JBL should identified those untapped
areas of business and invest.
I believe that these steps will be helpful to improve the performance of Janata Bank Limited
in the banking sector of Bangladesh.

JANATA BANK LIMITED
9.2 Conclusion
Proper financial system of a country can contribute towards the development of that
country‟s economy. In our country, banks have a leading power to its financial system.
Banking sector of Bangladesh consists of several nationalized and private banks. They are
doing their activities and highly contribute to the national economy. Among them Janata
Bank Limited also makes significant contribution to the economy.
With a bulk of qualified and experienced human resource, Janata Bank Ltd can exploit any
opportunity in banking sector. It is pioneer in introducing many new products and services in
the banking sector of the country. Moreover, in the overall-banking sector, it is unmatched
with any other banks because of its wide spread branch networking throughout the country.
The bank is performing general banking, Loan-advance, foreign exchange activities etc, as a
result they are mobilizing the money and do well for the economy.
Foreign Exchange Division is crucial for any bank. A bank‟s performance largely depends on
this division. Foreign Exchange activities have an equal significance to economic growth and
development of the country. During my internship in this branch I have found its Foreign
Exchange department to be very efficient; therefore this department plays a major role in the
overall efficiency & reputation of the Bank as a whole. As being the top class bank of
Bangladesh (according to the CAMELS rating), it has a good reputation and faith to
exporters, importers of Bangladesh. So through this division the banks are contributing to the
interest of the country. Although they have some limitations in their services, they are doing
tremendous job for the economy. If they can reduce their limitation and introduce new ideas,
they can do better in the banking sector of Bangladesh.
Finally, I would say that this internship at JBL has increased my practical knowledge of
Business Administration and make my BBA education more complete and applied. In this
report I got the opportunity to apply various tools and concepts that I learned in my BBA
courses.

JANATA BANK LIMITED
Reference
1. Janata Bank Ltd, Annual Report- 2008-2010

2. Agrani Bank Ltd, Annual Report-2009.2010
3. Rupali Bank Ltd, Annual Report-2009,2010
4. Janata Bank Ltd, website: www.janatabank-bd.com
5. Circulars issued by Janata Bank Ltd.
6. Different ledger books of the branch.
7. http://theguardianbd.com/history.html

JANATA BANK LIMITED
Appendix:-1

Project

Caricato da

Informazioni sul documento

Titolo originale

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

Project

Caricato da

Copyright:

Formati disponibili

JANATA BANK LIMITED

“A Committed Partner in Progress”

Ahsanullah University of Science & Technology Page | 1

Ahsanullah University of Science & Technology Page | 2

Serial No. Contents Page No.

Ahsanullah University of Science & Technology Page | 3

Chapter 5 Import Section 34-41

Ahsanullah University of Science & Technology Page | 4

Serial No. Contents Page No.

Serial No. Contents Page No.

Serial No. Contents Page No.

Ahsanullah University of Science & Technology Page | 5

Ahsanullah University of Science & Technology Page | 6

CCI&E Chief Controller of Import & Export

Ahsanullah University of Science & Technology Page | 8

1.1 Origin of the Report

1.2 Objectives of the Report

 To fulfill the partial requirement of BBA Program

1.3 Methodology of the Report

 Periodicals published by Bangladesh Bank

1.4 Scope of the Report

1.5 Limitations of the Report

 Lack of sufficient books, papers and periodicals take me go on serious brainstorming

Ahsanullah University of Science & Technology Page | 10

Ahsanullah University of Science & Technology Page | 11

2.1 Background of the Organization

2.2 Mission & Vision of the organization

To become the effective largest commercial bank in Bangladesh to support socio-economic

Ahsanullah University of Science & Technology Page | 12

2.3 Purposes of Janata Bank Limited as a Commercial Bank

 Providing service and relation development

 Collecting more deposit and money lending

 Increasing flow of money

Janata Bank Limited however serves the following social purposes

 Investment and Industrialization

Ahsanullah University of Science & Technology Page | 13

2.4 Functions of Janata Bank Limited as a Commercial bank

General Development Representative

Collecting deposit , Creation of savings and

Figure 1: Functions of Janata Bank Ltd.

2.5 Corporate Profile of Janata Bank Limited – At a Glance

Legal Status Public Limited Company

Authorized Capital Tk.20000 million

Ahsanullah University of Science & Technology Page | 14

Overseas Network Numbers of Branch-4 ( all branches located in United Arab

Numbers of Employees 12826

Fax 88-02-9564644, 9560869

Swift Code JANB BD DH

Table 1: Corporate Profile of Janata Bank Ltd.

Ahsanullah University of Science & Technology Page | 15

2.6 Management Organogram of Jnanta Bank Limited

Deputy Managing Director

Assitant General Manager

Senior Executive Officer

Assistant Executive Officer

Figure 2: Management Organogram of Jnanta Bank Ltd.

Ahsanullah University of Science & Technology Page | 16

2.7 Management Organogram of Jnanta Bank Limited, Kawran Bazar

Executive Executive Executive

Asstt. Asstt. Asstt. Asstt. Asstt.

Figure 3: Management Organogram of JBL, Kawran Bazar Corporate Branch

2.8 Service offerings/ Products of the Bank

 Current Deposit Account