CHAPTER- 01

Introduction
1:1) INTRODUCTION :
The business world is getting dynamic and competitive. It is hard for an organization to run
and even survive in a fast paced, growing and uncertain world if it cannot keep tracks with
the go of business dynamism. Business plays and links important roles in developing the
economy of a country. So, as a student of Department Business Administration, I need to be
attached with any organization to get a handy and versatile experience about the business
world before starting our career. Internship is the arrangement, which makes a bridge
between our academic knowledge and practical world to have an acquaintance with the real
business world as well as to gear me up to lead the future competitive business. I have
worked in different departments and sections of SBL, Sylhet Corporate Branch, Sylhet. In
this report, I will try to make an analysis on General Banking system of SBL.
1:2) ORIGIN OF THE REPORT

Bachelor of Business Administration (BBA) course requires 90 days or three month

attachment with a bank followed by a report assigned by the supervisor in the organization
and endorsed by the faculty advisor. I took the opportunity to do my internship in The Sonali
Bank Limited (SBL). My faculty supervisor Md. Gulam Mokta Dhir, Assistant Professor,
Department of Business Administration, Faculty of Finance and Banking, Metropolitan
University (MU), also approved the topic and authorized me to prepare this report as part of
the fulfillment of internship requirement. The report thus was titled as ‘General Banking
Activities of Sonali Bank Limited.’ This internship program and the study have following
purposes:-
 To fulfill the requirement of BBA Program;
 To experience the real banking world;
 To get and organize detail knowledge on the job responsibility;
 To get enough knowledge about General Banking activities of SBL;
 To apply theoretical knowledge in the practical field and
 To find out the overall features of SBL.

1.3) BACKGROUND OF THE REPORT:

Metropolitan University has given me a scope to submit a report on Sonali Bank Limited
which is the largest state-owned bank in Bangladesh. The primary purpose of this report is to
give my idea about the General Banking Activities of Sonali Bank Limited. This report is an
attempt to reflect the position of Sonali Bank Limited in the banking industry.
1:4) OBJECTIVES OF THE REPORT
The objective of the internship report was to familiarize with the real life Banking and
compare it with the books that we have learnt in our class. The objectives of the report are as
follows:-
1.4.1 General objective: General objectives of the report are:-
 To fulfill the requirement of BBA degree and
 To analyze “The General Banking Activities of Sonali Bank Limited.”

1.4.2 Specific objectives: Specific objectives of the study are:-

 To find out the internal system and actual general banking, loan and advance process
of SBL;
 To know about central bank requirements for the commercial banks on Loan and
Advances;
 To identify the level of customer satisfaction of SBL and
 To provide some valuable recommendations for the specific branch and bank for its
better future.
1:5) METHODOLOGY OF THE REPORT:
Methodology refers to the essential part of the study and the process of collecting information
and arranging it in terms of the relevant issues of the study. A number of methodologies are
used to collect required data and information. So we should know the classification of data
and the sources of these data.
To make the report more meaningful and presentable, two types of information have been
used. Those are

Primary Data

Secondary Data

1.5.1) Primary Data:

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General Banking Activities of SBL
Primary data is the data that is obtained through first-hand investigation. It can be either
quantitative focused on numbers or measurements, or qualitative, as when attitudes or
opinions are collected and studied. Information collected from primary data sources can be
interview, survey, experiments, questionnaire, focus group and measurement.
Primary Data Sources: The sources which I have followed to collect primary data are as
follows:-
Observation Method

Interview Method

Observation Method: Observing bank’s financial status, their organizational culture from
different group discussion and the procedures of banking activities.
Interview Method: Face to face interview with the bank officer and staffs and conversation
with customers visited the branch.
1.5.2) Secondary Data:
Secondary data is the data that has already been used. Secondary data can be found in
publications, journal and newspaper.
Secondary Data Sources: To make this report I have followed the following secondary data
sources:-
 Annual report of the Sonali Bank Ltd.
 Different voucher of the Sonali Bank Ltd.
 Official Records of Sonali Bank Ltd
 Website of Sonali Bank Ltd.
 Different circular sent by Head Office of SBL and Bangladesh Bank.
1:6) SCOPE OF THE STUDY:
This report has been prepared to gain a clear view of the General Banking activities of the
SBL. Using of all my whole experience I have tried to include different aspects of job
performance. The report will be limited to the level of customer satisfaction. It is my great
pleasure this bank has given me the opportunity to observe the banking environment for the
first time indeed. All provided their valuable suggestions which have contributed
significantly to my understanding on how all banking activities are done in SBL. I have a
remarkable contribution from my supervisor who contributed his valuable supervision,

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General Banking Activities of SBL
tireless effort and continuous attention to make this report a complete one. The scope of the
report can be described in terms of two grounds; like:-
Organizational Scope: I have worked in all the desks of general banking division of Sonali
Bank Limited, Sylhet Corporate Branch, Sylhet. I could not get the opportunity to work long
time in Foreign Exchange Department and Loan and Advance Department.
Periodical Scope: Practical orientation in bank has started from the 18 September, 2016 and
the duration of this internship was 90 days.
The report is confined to explain the detailed explanation of other Department; such as- Loan
and Advance Department, Foreign Exchange Department, Card Division, Cash Section.
Credit related to foreign exchange transactions (L/C, LTR, etc.) were excluded. Consumer
Credit (CC) or retail credit facilities and credit provided against Share have also been
excluded from the scope of this report. Details explanation about various types of credit
provided to the staffs of Sonali Bank has also been ignored, as they are special types of credit
provided as a motivating tool for the employees with special terms and conditions.
1:7) LIMITATIONS OF THE STUDY:
Though I have given utmost effort to prepare this paper but there is some limitation of the
study that I cannot ignore. The main limitations are as follows:-
 Time Constraint: The duration of internship program was not enough to cover all aspect
of banking. Due to time limitation many of the aspects could not be discussed in the
present report.
 Business Secrecy: The main constrain of the study was insufficiency of information
which was required for my report. Some time employees of the bank cannot provide
various information due to security and other corporate obligations.
 Information: Since the bank personnel were so much busy with their own work, they
could not provide enough time for making concept clear in a particular area.
 Different Circular: For being the largest commercial bank of Bangladesh the functions
and activities of Sonali Bank are too vast, so they change their strategy day by day. As a
result I can’t collect update information and strategy.
 Lack of knowledge: Due to Lack of knowledge, experience and expertise in banking field
it becomes hard to understand each and everything during practical program.

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General Banking Activities of SBL
 Chapter-02
Overview of Banking Industry
2.1) BANK:
Bank is the life blood of modern economy. The word bank derived from Italian word “Banco,
Banca, Bancus” etc. and German word “Banke”. Simply bank is a bridge between surplus
unit and deficit unit. In the broader sense a bank is a financial intermediary institution which
collects funds from the surplus group of a society as deposit at lower rate of interest and
provide those funds to the deficit group of the society as loan at higher rate of interest.

Banke Banco Bank

(German) (Italian) (English)

Image: Origin of the word of bank

2.2) ORIGIN AND EVALUATION OF BANK:

For an economy is like as blood in a body and a bank may be compared to an artery system of
a body. Modern banking system is not a consequence of an accident but a result of a gradual
systematic development. Though history of banking is as old as human civilization but there
exists little historical evidence as to nature of real banking operation before 13th century. For
the earlier period, the destination between commercial bank and other types of banks is
difficult to make with certainty. It is very difficult for this early period to differentiate
between the activities of dealers in coin and in billion and the activities of bank. Money
exchanger and business were often viewed as one and the same. According to the historians
the first bank of the world was established in China in 600 B.C. Although the banking
business was mostly done by private individuals like the Gold Smith (1000), Jewish
Merchants (1200), and Money Lenders (1300) during the ancient period, many countries
established public banking in order to facilitate trade and commerce or to serve the
government. The Bank of Venice established in 1157 is supposed to be the most ancient
bank. Then the bank of Sans Georgia was established in 1178. Originally there was not full
bank in the 14 modern sense, being simply an office for the transfer of the public debt. It
seems to the historian that Bank of Barcelona is the first modern bank of the world that was
established in Venice, Milan, Amsterdam, and Humbug. Majority of the historians agrees that
the institutional father of modern banking was the Bank of England chartered in 1694. After

4
General Banking Activities of SBL
it, many modern banks were established in the world like Hindustan bank (1700), Bank of
France (1800), Bank of Japan (1982) act.
At a glance the history of gradual evaluation of banking system:-
 Ancient age
 Middle age and
 Modern age.
Banking of the ancient age: The most remarkable civilizations of ancient age are Chin, Vedic,
Babylon, Roman (in Roman civilization the bankers were known as Arjentari, Kolistiboy
etc.), Persians civilization so on.
Banking of the middle age: In middle age the ancestors of modern bank (Goldsmiths, money
lenders and the merchant) brought about fabulous expansion of banking business. In this age
Bank of Venice established in 1157.
Banking at modern age: The modern age of banking system started with the establishment of
Bank of Barcelona in 1401.
2.3) DEVELOPMENT OF BANKING BUSINESS IN BANGLADESH:
Beginning of Banking in Bangladesh: After independence there was serious crisis in the
banking sector of Bangladesh. As a result, the Government of People’s Republic of
Bangladesh was formally to cover the charge of the administration of the territory new
constitute Bangladesh. In an attempt to rehabilitate the war-devastated banking of
Bangladesh, the government promulgated a law called Bangladesh Bank (temporary) Order,
1971 (Acting President’s order No.2 of 1971). By this Order, the state bank of Pakistan was
declared to be deemed as Bangladesh Bank and offices, branches and assets of said State
Bank was declared to be deemed as offices, branches and assets of Bangladesh Bank. On that
date there existed 14 scheduled banks with about 3042 branches all over the country.
On the 16th December 1971, there existed the following 12 banks in Bangladesh, namely:-
 National Bank of Pakistan
 Bank Bahawalpur Ltd.
 Habib Bank Ltd.
 Premier Bank Ltd.
 Commerce Bank Ltd.
 United Bank Ltd.
 Union Bank Ltd.
 Muslim Commercial Bank Ltd.

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General Banking Activities of SBL
  Standard Bank Ltd.
 Australasia Bank Ltd.
 Eastern Mercantile Bank Ltd.
 Eastern Banking Corporation Ltd.
Nationalization of Banks in Bangladesh: Immediately after the Government of Bangladesh
Consolidated its authority, it decided to adopt socialist pattern of society as its goal. Hence in
order to implement the above mentioned state policy, the Government of Bangladesh decides
to nationalize all the banks of the country accordingly on the 26th March, 1972, Bangladesh
Banks (Nationalization) Order, 1972 (President Order No.26 of 1972) was Promulgated. The
list of those new nationalized banks is below:-

Existing Bank New Bank

1. National Bank of Pakistan. 1. Sonali Bank Ltd.

2. Bank Bahwalpur Ltd.
3. Premier Bank Ltd.

4. Habib Bank Ltd. 2. Agrani Bank Ltd.

5. Commerce Bank Ltd

6. United Bank Ltd. 3. Janata Bank Ltd.

7. Union Bank Ltd.

8. Muslim Commercial Bank Ltd. 4. Rupali Bank Ltd.

9. Standard Bank Ltd.
10.Australasia Bank Ltd.

11 Eastern Mercantile Bank Ltd. 5. Pubali Bank Ltd.

12.Eastern Banking Corporation Ltd. 6. Uttara Bank Ltd.

2.4) LITTLE INTRODUCTION OF CENTRAL BANK:

In a country’s economic system, central bank plays an important role as an advisor, a
guardian of government and an apex regulatory body for the country’s monetary and
financial system. Each country of the world has a central bank which prevents the country’s
banking system from failing. So, we can define central bank as a monetary guardian of
transaction system that takes monetary policy to against inflation and deflation.

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General Banking Activities of SBL
 The name of the central bank of Bangladesh is Bangladesh Bank which was established in
Dhaka as a body of corporate vide the Bangladesh Bank Order, 1972 (P.O. No. 127 of 1972)
with effect from 16 December, 1971.

The main features of central bank are:-

 Act as a guardian of money market,

Features of Central  Act as a clearing house,
 Banker of the last resort
Bank  The banker’s of others banks and
 The banker of the government

2.5) LIST OF BANKS IN BANGLADESH:

The commercial banking system dominates Bangladesh’s financial sector. We have known
that Bangladesh Bank is the Central Bank of Bangladesh and the chief regulatory authority
in the sector. On the basis of scheduling the banks in Bangladesh are primarily of two types.
They are:-
i. Scheduled bank and
ii. Non-Scheduled bank.

I) Scheduled Bank: According to Bangladesh Bank Order- 1972 article 1, “A scheduled

bank means a bank for the time being included in the list of banks maintained by the central
bank under sub-clause (a) 2 of article 32.” In present there are total 57 scheduled banks in
Bangladesh.
57 Scheduled
Banks

6 2 9
32 8
State-owned Specialized foreign
Private Islamic
Commercial Banks commercial
Commercial Private
Banks (SCB)
banks (PCB) commercial banks
Or National
banks
Banks (NCB)

Image: Total Scheduled Banks in Bangladesh

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General Banking Activities of SBL
II. Non-scheduled Bank: Non-scheduled banks are those banks which are not included in
the schedule of the central bank. They do not get any privileges of clearing system and re-
discounting of bills. These banks clear their cheques through any scheduled bank.
The list of all scheduled and non-scheduled bank in Bangladesh are mentioned below:
List of all Scheduled Banks:
1. State-owned Commercial Banks (SCB’s or NCB’s)
1. Sonali Bank Ltd.
2. Janata Bank Ltd.
State-owned Commercial 3. Agrani Bank Ltd.
Banks 4. Rupali Bank Ltd.
5. BASIC Bank Ltd.
6. BDBL Ltd.
2. State-owned specialized Banks: Development Bank Ltd.

State-owned 1. Rajshahi Krishi Unnoyon Bank

Specialized Banks 2. (RKUB)Bangladesh Krishi Unnoyon Bank

3. Local Private Commercial Banks (PCB’s):

1. AB Bank Ltd.
2. Bangladesh Commerce Bank Ltd.
3. Bank Asia Ltd.
4. BRAC Bank Ltd.
5. Dhaka Bank Ltd.
6. Dutch-Bangla Bank Ltd.
7. Eastern Bank Ltd.
8. IFIC Bank Ltd.
9. Jamuna Bank Ltd.
10. Meghna Bank Ltd.
11. Mercantile Bank Ltd.
12. Midland Bank Ltd.
Local Private 13. Modhumoti Bank Ltd.
14. Mutual Trust Bank Ltd.
Banks
15. National Bank Ltd.
16. NCC Bank Ltd.
17. NRB Bank Ltd.
18. NRB Commercial Bank Ltd.
19. NRB Global Bank Ltd.
20. One Bank Ltd.
21. Prime Bank Ltd.
22. Pubali Bank Ltd.
23. Simanto Bank Ltd.
24. South Bangla Agriculture and Commerce Bank Ltd.
25. Southeast Bank Ltd
26. Standard Bank Ltd
27. The City Bank Ltd.
28. The Farmers Bank Ltd.
29. The Premier Bank Ltd.
30. Trust Bank Ltd.
31. United Commercial Bank Ltd.
32. Uttara Bank Ltd.
33. The Premier Bank Ltd.
34. Trust Bank Ltd.
35. The Farmers Bank Ltd. 8
General Banking Activities of SBL
4. Local Private Islamic Commercial Bank (PCB’s based on Sariah):

1. Islami Bank Bangladesh Ltd.

2. ICB Islamic Bank Ltd.
3. Al-Arafah Islami Bank Ltd.
Local Private Islamic 4. Social Islami Bank Ltd.
Commercial Banks 5. EXIM Bank Ltd.
6. First Security Islami Bank Ltd.
7. Shahjalal Islami Bank Ltd.
8. Union Bank Ltd.

5. Foreign Private Banks (FCB’s):

1. Standard Charted Bank

2. Habib Bank Ltd.
3. State Bank of India
4. Commercial Bank of Ceylon Ltd.
5. National Bank of Pakistan
Foreign Private Banks 6. Citi Bank N.A
7. Woori Bank
8. HSBC Bank Ltd
9. Bank AL Falah Ltd.

List of Non-Scheduled Banks:

There are now 5 non-scheduled banks in Bangladesh; which are:-

1. Grameen Bank
2. Ansar VDP Unnayan Bank
3. Karmashangosthan Bank
4. Probashi Kollayn Bank and
5. Jubilee Bank.

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General Banking Activities of SBL
 Chapter-03
Overview of sonali Bank Limited
3.1) BACKGROUND OF SBL:
Soon after independence of the country Sonali Bank emerged as the largest and leading
nationalized commercial bank by proclamation of the Bank’s Nationalized Order 1972
(Presidential Order-26) liquidating the then National Bank of Pakistan, Premier Bank and
Bank of Bhwalpur. As a fully state owned institution, the bank had been discharging its
nation-building responsibilities by undertaking government entrusted different social
economic schemes as well as money market activities of its own volition, covering all
spheres of the economy.
The bank has been converted to a Public Limited Company with 100% ownership of the
government and started functioning as Sonali Bank Limited from November 15, 2007 taking
over all assets, liabilities and business of Sonali Bank. After corporatization, the management
of the bank has been given required autonomy to make the bank competitive and to run its
business effectively.
Sonali Bank Limited is governed by a Board of Directors consisting of 11 members. The
bank is headed by the Managing Director and CEO (Chief Executive Officer), who is a well-
known Banker and a reputed professional. The corporate head quarter of the bank is located
at Motijheel, Dhaka, Bangladesh, the main commercial center of the capital.
Slogan
“Your Trusted Partner in Innovative Banking

Sonali Bank Gets Best Brand Award

Sonali Bank Limited, the largest commercial bank of the country, received best brand award
from Bangladesh Brand Forum, a wing of international survey organization Nielsen. SBL
was also awarded the same consecutive previous two years.

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General Banking Activities of SBL
Nealsen Bangladesh has been conducting this survey since 2008 in Bangladesh. Generally
customers’ satisfaction, retail market share and sustainability were the main focus of the
survey. In Bangladesh, Nealsen Bangladesh carries out their survey in 19 different sectors.
According the survey mass people regard Sonali Bank as the bank of all class.

3.2) VISION, MISSION AND OBJECTIVES:

Socially committed leading banking institution

Vision with global presence

Dedicated to extend a whole range of quality

products that support divergent needs of
Mission people aiming at enriching their lives, creating
value for the stakeholders and contributing
towards socio-economic development of the
country

The main objectives of the bank are to

provide all type of banking services to the
door steps of people. The bank participates in
various socio-economic development
activities and also takes part in
Objectives
implementation of various policies and
program made by government. As the largest
state-owned commercial bank, SBL has the
responsibility to run it as a service-oriented
and professional managed leading bank of
the country

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General Banking Activities of SBL
3.3 AT A GLANCE OF SBL:

3.3.1) Corporate Information:

CORPORATE PROFILE
Name of the Company : Sonali Bank Limited
Chairman : Mr. Md. Ashraful Moqbul

CEO & Managing Director : Mr. Md. Obayed Ullah Al Masud

Company Secretary : Mr. A.K.M Sajedur Rahman Khan

Legal Status : Public Limited Company

Date of Incorporation : 03 June, 2007

Date of Vendor's Agreement : 15 November, 2007

Registered Office : 35-42, 44 Motijheel Commercial Area, Dhaka, Bangladesh

Authorized Capital : Taka 6000.00 Crore

Paid-up Capital : Taka 3830.00 Crore

Number of Employee : 22,446

Total No of Branches 1209, No of Foreign branches=2, No of Local

branches=1207
No of Regional Offices 16
No of Principal Offices 46
No of G.M. Offices 11
Phone-PABX 9550426-31, 33, 34, 9552924
FAX 88-02-9561410, 9552007
SWIFT BSONBDDH
Website www.sonalibank.com.bd
E-mail itd@sonalibank.com.bdf
Office Time Sunday – Thursday (10.00 am - 6.00 pm)
Transaction Time Sunday – Thursday (10.00 am – 4.00 pm)

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General Banking Activities of SBL
Subsidiaries:

1. Sonali Exchange Company Incorporated (SECI) having 10 (Ten) branches in USA.

2. Sonali Investment Limited (Merchant Banking) having 4 (Four) branches at Motijheel,
Paltan, Uttara, Mirpur in Dhaka and 1 (One) branch in Khulna, Bangladesh.

Associates:

1. Sonali Bank (UK) Limited having 6 (Six) branches in UK.

2. Sonali Polaris FT Limited

3. Representative Office: 3 [One) in Jeddah, KSA; one in Riyadh, KSA and one in Kuwait

4. Correspondence: 639

3.3.2) Business/Services:

Sonali Bank operates the following services:-

Core Business:
- Corporate Banking
- Project Finance
- SME Finance
- Remittance
- Lease Finance
- Consumer Credit
- Trade Finance
- Loan Syndication
- Foreign Exchange Dealing
- International Trade
- NGO-Linkage Loan
- Consumer Credit
- Investment
- Government Treasury Function
- Money Market Operation
- Rural and Micro Credit
- Capital Market Operation

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General Banking Activities of SBL
 - Special Small Loan

Other Business/Services:
- Government Treasury Bonds
- Locker Service
- ATM Card
- Utility Bills Collection
- Ancillary Services
- Merchant Banking

Islamic Banking Services:

Deposit Products Investment Products

 Al-Wadeeah Current Account(AWCA)  Bai-Murabaha

 Mudaraba Savings Account(MSA)  Bai-Muajjal

 Mudaraba Special Notice Deposit Account(MSNDA)  Bai-Salam

 Mudaraba Term Deposit Account(MTDA)  Bai-Istisna

 Mudaraba Hajj Saving Account(MHSA)  Hire Purchase Under

Shirkatul Melk (HPSM)
 Mudaraba Sonali Monthly Deposit Scheme(SMDS)

 Mudaraba Monthly Profit Scheme(MMPS)

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General Banking Activities of SBL
3.3.3) Product and Services of Sylhet Corporate Branch:

Product and Services of Sylhet Corporate Branch

Deposits 1. Savings Deposit A/C

2. Current Deposit A/C
3. FDR A/C
4. STD A/C
5. Sonali Deposit Scheme [SDS:-Valid from 18-May-2016]
6. Educational Deposit Scheme [EDS :-Valid from 18-May-2016]
7. Medicare Deposit Scheme [MDS:-Valid from 18-May-2016]
8. Rural Deposit Scheme [RDS:-Valid from 18-May-2016]
9. School Banking Scheme (SBS)
10. Sonali Bank Deposit Pension Scheme [SBRS:-Valid from 19-May-2016]
11. Sonali Bank Millionior Scheme [SBMS:-Valid from 19-May-2016]

Credit 1. Consumers Credit

Schemes 2. Special Small Credit Scheme
3. IT Finance
4. Loan for Diagnostic Center

3.3.4) Disclosure on Risk Based Capital:

 BASEL-III Year 2017

 BASEL-II Year 2015-2018

3.3.5) Management Hierarchy:

Managing Director (MD)

Deputy Managing Director (DGM)

General Manager (GM)

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General Banking Activities of SBL
 Deputy General Manager (DGM)

Assistant General Manager (AGM))

Senior Principal Officer (SPO)

Principal Officer (PO)

Senior Officer (SO)

Officer

Junior Officer (JO)

Assistant Officer Grade (AOG)

Supporting Staff (SS)

PTS

Image: Management Hierarchy of SBL

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General Banking Activities of SBL
3:4) PRODUCT AND SERVICES (WITH INTEREST RATE ) OF SYLHET CORPORATE
BRANCH:

3.4.1) Interest Rate on Deposit Products:

Serial Type of Deposits Rate of Interest

No.
Existing Rate New Rate

1. Savings Deposit 5.00% 4.00%

2. Fixed Deposit Receipt (FDR)

For 3 months to >6 months 5.50% 5.00%

For 6 months to >1 year 5.75% 5.25%
For 1 year to >3years 6.00% 5.50%

3. Short Notice Deposit (SND)

Less than TK 25 crore 4.00% 4.00%

From TK 25 crore to TK 100 crore 4.50% 4.00%
Above TK 100 crore 5.00% 4.00%

4. Sonali Bank Daily Profit Account (SBDP) 5.00% 5.00%

3.4.2) Interest Rate on Loan and Advance:

Serial No. Categories Rate of Interest

1. General Advances

Freedom Fighter 7%

Cash Credit: General-Hypothecation 13%

Overdraft 3%

Small Loan 13%

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General Banking Activities of SBL
 House Building Loan (Only for staff) 5%

Other Staff Loan 5%

Car Loan 0%

Computer Loan 5%

Small Business Loan 13%

Personal Loan 13.5%

2. Industrial Credit

Loan under Sonali Bank Industrial Credit 13%

Loan under External Credit Programme 0%

Working Capital to Industries-Hypothecation 13%

3. Rural Credit

Agricultural Credit 10%

Micro Credit 12%

Refinance Scheme for Milk Production 7%

4. Small and Medium Enterprises (SME) 13%

5. Loan against-

- FDR
- DPS
- SDPS
- SDS
- EDS
3% more than
- MDS
the provided
- RDS
interest rate to
- MSS
customer
- MES

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General Banking Activities of SBL
- DBS
- NRDS

19
General Banking Activities of SBL
 Chapter: 4
Task Completed During Internship
In my BBA Program I just theoretically understood all the activities related to banking
industry. However, in my internship, I have practically understood all the activities of
banking systems and procedures. Here, mentioned that, it is not possible for me to explain
each of tasks and details for limitations. But I have tried to explain the main facts and tasks
performed by me.

4.1) GENERAL BANKING DEPARTMENT

General banking is the heart of business banking activities. General banking department
performs the core function of bank operates the day-to-day transactions. It is the storage point
of all kinds of purpose in transactions. General banking is the front-side banking service
department. It provides services to customers coming frequently as well as customers coming
for only one time in the bank for enjoying ancillary services. General Banking is an important
department for all banks because it provides day-to-day service to the customers. It is the
department that serves most of the customers of the Bank and the image of the Bank is
established with the services provided by the Front Desk. Almost all the customers are
directly served by this department. Customers open accounts, issue checks books, deposit
their money, receive payments, remit funds, issues bank drafts and pay orders and meet their
demand for cash by honoring checks with this department.

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General Banking Activities of SBL
A typical Bank has generally the following sections -

Account
Opening

General
Cash Clearing
Banking
Section

Remittance

Sylhet Corporate Branch of SBL has all the required sections of general banking which
are as follows:
- Account opening section
- Bills and clearing section
- Cash section
- Remittance section and
- Mails receive and dispatch section.
As an intern of Sylhet Corporate Branch of SBL, I was assigned in the 3 sections of General
Banking Department which are- Account Opening Section, Bills and Clearing Section and
Remittance Section. The activities done by me in these sections are described below:-
4.1.1) Account Opening Section:
One of the vital sections under general Banking is the account opening section. In Sylhet
Corporate Branch of SBL Mr. Md. Waris Ahmed (SPO) is in charge of account opening

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General Banking Activities of SBL
section. Banker customer relationship begins this section. Various tasks are performed in this
section. Such as:-
 Opening of different types of account
 Issue of checkbook
 Transfer and closing of account
 Enquiry of account.
 Collection of Deposit:
Deposits are life-blood of a commercial bank. Without deposits there are no businesses for
the commercial banks of any nature (NCBs, PCBs or FCBs). Accepting deposits is one of the
two classic functions of commercial banks. Bank deposits can be broadly classified as
follows:-

Bank Deposits

Demand Deposits Time Deposits

(Current deposits, (FDR, STD etc.)

savings deposits etc)

Chart: Types of Bank Deposits

 Demand Deposits: Demand deposits can be withdrawn without any prior notice; such as:
current deposits. Sonali Bank Sylhet Corporate Branch accepts demand deposits through
the opening of
- Current Account
- Savings Bank Account
 Time Deposits: On the other hand a deposit that is payable at a fixed date or after a period
of notice is called ‘Time Deposit’. This branch accepts time deposit through
- Fixed Deposit Receipt (FDR)
- Short Term Deposit (STD)

 Types of Account: Accounts department is the most important functional area of this
branch. The following types of accounts are maintained in this bank:

22
General Banking Activities of SBL
1. Fixed deposits A/C
2. Short-term Deposits A/C
3. Savings deposits A/C
4. Current deposits A/C
5. Call deposit A/C
6. Sundry deposit Accounts.
 Procedures for opening of accounts:
Before opening of a current or savings account, the officer of account opening section hears
personal details specially where he or she is living and about his or her income source. If the
customers live near of the particular branch, the branch permits him or her to take an account
opening form and fill up it but if he or she does live near the particular branch, the officer
suggests him or her to go to nearest branch of SBL of his or her home and open an account.
With the prescribed application form the customer has to submit the following paper and
application:-
1. Original Copy (for checking) and photo copy of National ID Card or Birth Certificate or
Passport;
2. Two copies of recent passport size photographs;
3. Introduction by an account holder who has an account with the respective branch;
4. Putting three specimen signature in the “Specimen Signature Card” and
5. Mandate (if necessary).
During my internship I have opened at least 4/5 accounts daily in Sylhet Corporate Branch
following above-mentioned formalities. Most of the accounts are Savings and very few
accounts are Current. I have also opened 30-40 School Banking Accounts in my three months
internship at this branch.
 Cheque Issue:
After doing the above formalities, the branch provides the customer a pay-in-slip and a
cheque-book. The cheque-book may be off 10-page, 25-page, 50-page or 100-page depending
on the type of account the customer has opened. To complete the issuing of cheque-book, a
customer has to fill-up the ‘Requisition Slip’ for cheque-book. Then a new cheque-book will
be filled-up by the account number of the customer and name of the branch in each page of
the cheque-book. The name and account number of the customer are registered in the
“Cheque-book Issue Register” and a signature is then taken in this register book by the
customer. The requisition slips are maintained and recorded as vouchers. The serial number
of the cheque-book is also entered in the computer for the proper maintenance of records and

23
General Banking Activities of SBL
to prevent any attempt of forgery. I issued 15-20 (average) cheque books daily during my
internship program.

Sylhet Corporate Branch of SBL also provides MICR cheque book for its customers by
which they can withdraw money from any branch. To get MICR cheque the customers have
to give an intent in MICR Cheque Issue Register.

Charges: To pay salary and allowances for its employees the branch gives 2 cheque books
(Each of 10 leaves) to its employees without any charge. But Tk 10 is charged for each extra
cheque book of 10 leaves in case of bank staffs. But in case of issuing cheque book for other
savings, cuurent and NSD account holders, TK 1 is charged for each leave. And for MICR
cheque 2.5 taka is charged for each leave.
 Application form for current and savings account:
Recently SBL has changed its former application form for opening account. The new
application form includes 12 pages which are filled by customer and finally branch officer.
Followings are the main contents of the new application form for opening Savings or Current
account in Sylhet Corporate Branch, Sonali Bank Limited:
1) Name of the Applicant(s),
2) Father’s/Husband’s Name and Mother’s name,
3) Nationality,
4) Occupation,
5) Date of Birth,
6) Address: Present, Permanent and Occupational,
7) Introducer’s information
8) Information about the Nominee
9) Special instruction for operation of the account (if any)
10) Initial Deposit
11) Specimen signature(s) of the Applicant
12) Voter ID number or Birth Certificate number or Passport number
14) 2 copies recent passport size photos of account holder attested by the introducer
15) Photo of the Nominee(s) attested by the Account Holder.
[If the account holder wants to take ATM service when he or she is opening account, then an
another form named as Debit Card Application Form has to be fulfilled by the customer with

24
General Banking Activities of SBL
a extra copy of passport size photograph and this copy of passport size photo does not need to
be attested by introducer]
In case of joint account, the applicant must furnish the following information and papers:-
1. Name of the parties who will open and operate the account and sign the checks;
2. At the event of death either or any of the account holders how the balance will be paid
and to whom the securities (if any) will be delivered. The documentary requirements are
almost the same as individual accounts. Account opening form and the special
instructions must be signed by all the joint account holders to signify their consent;
3. If the client is a partnership company, the company has to submit partnership deed to the
bank;
4. If the applicant is a sole proprietorship business, the client has to submit trade license
collected from the appropriate authority and seal of the institution.
5. If the client is a private or public limited company, the company has to submit
Memorandum of Association (MOA), Article of Association (AOA) and other necessary
documents. Name and specimen signature of the people who are authorized to open and
operate the account and the source of their authority.
 Application Form for Fixed Deposit Receipt (FDR):

Fixed deposits are the deposits in which an amount of cash is deposited in bank for a fixed
period specified in advance. Hence, these deposits are time deposits or time liabilities.
Normally, the money on a fixed deposit is not repayable before the expiry of a fixed period.
At the time of opening the deposit account, the banker issues a receipt acknowledging the
receipt of money on deposit account. It is popularly known as FDR (Fixed Deposit Receipt).

In Sylhet Corporate Branch of SBL, the application form for FRD account opening form is
like savings account and current account forms. But the account holder does not need to
fulfill all pages of account opening form like savings account and current account. In Sylhet
Corporate Branch, following necessary headings have to be fulfilled by an account holder for
opening a FDR account:-
(a) Amount in figures
(b) Period
(c) Rate of interest
(d) Beneficiary’s name and address
(e) Special instruction in case of joint account

25
General Banking Activities of SBL
(f) Information about nominee(s)
(g) Address of the applicant(s)
(h) Specimen signature(s)
In Sylhet Corporare Branch, after opening a FDR Account, it is usually not recorded in any
FDR register. In case of Fixed Deposit Accounts, the bank needs not hold a cash reserve to
repay money to the customers. The payment will be made after the completion of a certain
period. Hence, Sonali Bank Ltd. offers a high interest rate in Fixed Deposit Account which
have been mentioned in chapter 3.
 Short Term Deposit:
During my internship program I have noticed that in Short Term Deposit (STD) Account, the
deposit should be kept for at least seven days to get interest. The interest offered for STD is
less than that of savings deposit. In Sylhet Corporate Branch, Government Departments like
BIWTC, Jiban Bima Corporation, Bangladesh Biman and other private organizations and
individuals keep money in STD accounts. For this type account, frequent withdrawal is
discouraged and requires prior notice. STD is also called SND or Short Notice Account.
In Sylhet Corporate Branch, usually customers give an instruction that their current accounts
will be debited whenever the deposited amount crosses a certain limit and this amount will be
transferred to the STD account. The Branch follows this instruction by giving the following
entries –
Customer’s Current A/C------------------- Dr.
Customer’s STD A/C---------------------- Cr.
 Transfer of Account to another Branch: The account holder requests to transfer his
accounts by giving the following instructions:-
 Reasons for transfer the account
 Address of the branch at which customer wants to transfer the account and
 The unutilized cheque book will be returned to the transferring branch before transfer of
account.
After verification, the approval of the manager for transferring the account is obtained and
then the specimen of the forwarding letter of transferee branch will be sent. After the
application is received duly approved from the manager, the branch transfer the account
based on the following entries-
Customer’s Account--------------------------- Dr
Transferee Branch Account------------------ Cr
Service charge (income) ---------------------- Cr

26
General Banking Activities of SBL
In case of transferring a saving account (Monthly), TK 200 is charged in cash and maximum
charge is TK 300 (including Post cost). But to transfer a government account and bank’s own
employees account the bank does not deduct any service charges.

 Closing an Account
During the study work I have been taught how to close a bank account before maturity. In
order to close an account before maturity the holder has to place a written application to the
bank. After receiving the application the bank will deduct service charge at an amount
necessary for the respective account as closing fee from the balance and rest of the money is
given to the account holder and the cheque book is to be returned to the branch.

When bank closes an account: Bank closes an account in the following situations:-

 If a customer places written application to the bank to close his account

 If the customer does not properly follow the rules and regulations necessary to operate his
account

 If the bank is notified the message of death of a customer

 If the bank receives a notice regarding the insanity of his customer

 If the bank receives a garnishee order from court etc.

Accounting entries will be-

Customer’s Account--------------------------- Dr
Account Closing Charge (income) ---------- Cr

4.1.2) Remittance section

The system of transmitting or sending money from one branch to another branch of the same
bank or from one bank to another bank within a country or outside the country is known as
remittance. It is one of the important functional areas of a bank. A bank can earn handsome
fees as commission from the dealings of money remittance. During my internship program I
have gathered practical experience about how money is remitted from one branch to another
branch of a bank or from one bank to another bank.

27
General Banking Activities of SBL
 Issuing Paying
Remitter Branch Branch Payee

Chart: Bank Remittances Flow

 Types of Remittance

Sonali Bank Ltd. earns more from this section by TT, DD, MT, PO, Spot cash, Western
Union, Xpress Money, Transfast, EFT, BFTEN etc. Remittance can be of two types; such as:-

a) Inland Remittance
b) Foreign Remittance.

a) Inland Remittance: When money is remitted within a country through proper banking
channel, it is termed as inland remittance. Sonali Bank, Sylhet Corporate Branch deals a
lot of inland remittance at every working day.

Modes of Inland Remittance: From three months internship program I have known that there
are various types of inland remittances. They are:-

1. Demand Draft (DD)

2. Pay Order (PO)
3. Mail Transfer (MT)
4. Telegraphic Transfer (TT)
5. Any Branch Banking (ABB)
1. Demand Draft (DD):
DD is the most widely used instrument of remitting fund. It is order to pay money drawn by
one branch of a bank upon another branch of same bank for a particular amount of money
that is payable to order and demand. This instrument can be purchased by a customer from a
particular bank for himself and can be handed over to the purchaser for delivery to the
beneficiary. The payee or beneficiary will claim the amount of money in the instrument by
producing the same to the concerned paying branch. Demand draft may be paid in cash to the
payee on proper identification or the amount may be credited to his account (in case of A/C
holder of the bank).

28
General Banking Activities of SBL
 Voucher Issuing Branch gives Purchaser
submitted to branch DD to sends DD to
branch prepares DD purchaser payee

Paying Payee
branch pays presents DD
the amount to branch

Flow Chart for DD

Receiving Money DD presented

Issuing Branch Sends Paying Branch

Advice of Drawing

Issues DD Pays DD
Flow Chart for DD Payment

Procedures of remitting money through DD: The procedures of remitting money through DD
are stated briefly in below:-

a) At first, the sender of money is advised to fill up a form and deposit the cash. The form is
usually called DD application form or credit voucher,

b) The senders of money fills up the voucher appropriately and place it with cash before the
officer at cash receipt section,

29
General Banking Activities of SBL
c) After receiving the voucher and cash, the officer counts the money and charges a fee as
commission,
d) After that, the voucher is sent to the concerned officer of remittance section,

e) Here the officer prepares a paper instrument called “Demand Draft (DD)” and enters the
amount in the draft issue register,
f) If everything is okayed, the officer signs the DD and voucher and keeps the register and
counter foil of the DD,
g) After that the DD is issued to the sender of money. At this stage he can send the DD to
the receiver branch by post or any other ways,
h) After issuing the DD and handing over it to the sender of money, the DD issuing branch
sends an advice to the receiver branch about DD and
i) Finally, the DD receiver branch makes payment to the bearer of DD. i.e. payee after
completing the necessary formalities.

[There are two kinds of DD paper instruments; one is for government DD and another one is
for others. Government DD is entered in the “Government DD Issue Register” and others are
entered in the “Normal DD Issue Register”. During internship program I have completed
these tasks maintaining named formalities]

2. Pay or Payment Order (PO): Payment Order (PO) is an instrument that contains an order
for payment to the payee only in case of local payment whether on behalf of the bank or its
constituents. Customers can purchase to deposit as security money or earnest money.
Payment Order is in the form of receipts and issued by joint signatures of two officials.
Payment of this instrument is made from the branch it has been issued. The payee’s banker
who should certify that the amount would be credited.

3. Mail Transfer (MT): MT is another widely used instrument of remitting fund from one
branch of a bank to another branch of the same bank. It is not used to remit fund from one
bank to another. MT is nearly same as DD

Procedures of remitting money through MT: The procedures of remitting money through MT
are almost same as the procedures of remitting fund through DD. But there are some
exceptions in this system. The procedures of remitting money through MT are stated in
below-

30
General Banking Activities of SBL
a) In case of MT, the sender of money is not provided with the MT paper but a receipt. The
branch sends the MT paper under its own responsibility by mail to the MT receiving
branch.
b) The MT issuing branch has to send a secret message i.e. test to the MT receiving branch.
It is must for any amount of money. Here the amount of money, issuing date and other
particulates are mentioned.
c) To maintain the secrecy of the message sent, the issuing branch codes the message by a
particular number consisting of different digits. After receiving the message, the paying
branch decodes it by using the predetermined techniques. This process is called test. In
Sylhet Corporate Branch of SBL test is done by Senior Principal Officer. If everything is
okayed, the paying branch makes payment to the payee.

4. Telegraphic Transfer (TT): TT is another widely used mode for remittances of funds.
Telegraphic Transfer is quicker than a transfer of amount by DD or MT. The customer
deposits money with the branch to be sent. The customer obtains a cash memo containing TT
serial number.

Procedures of remitting money through TT: The primary formalities that have to be followed
to remit money through TT are same as DD and MT. These are:-

a) In case of TT, no paper instrument is sent to the paying branch. Rather the TT issuing
branch sends a TT advice through telephone, telegraph, Fax or telex to the paying branch.
In sending message, the branch keeps necessary secrecy,

b) Side by side, the TT issuing branch sends an advice to the Head Office of the bank,

c) After receiving the message, the paying branch tests to decode the message. If everything
is obeyed, then the branch makes payment to the payee. After that the branch sends an
advice to the head office to reconcile the accounts of both branches and

d) In case of TT, test is must for every issue and for any amount of money.

5. Any Branch Banking (ABB): Sonali Bank Limited is providing Any Branch Banking
facility through its 1,203 branches. To provide fast service, Sylhet Corporate Branch of
Sonali Bank Limited is providing this facility to its customer. To transfer an amount through

31
General Banking Activities of SBL
ABB from Sylhet Corporate Branch, the customers have to use TT, MT, DD form (F-11).
The bank detects a service charge from customers on the basis of transferred amount.

 Charges: The commission for DD, TT, and MT up to TK 30,000 is Tk. 30 for per 1000
and Tk. 1 for every thousand above Tk. 30,000. But in case of Payment Order (PO), the
following service charges are charged:-

Amount Charge

Upto TK 1000 20
Upto TK 1,00,000 30
Above TK 1,00,000 100

In present as VAT TK 5 is charged for DD, TT, MT, and PO. There are some branches of
SBL which provides DD, TT and MT services for their employees without any service charges
and some branches provide these services to their staff with service charge.

B) Foreign Remittance: The procedure to transfer money from one country to another country
through bank or other govt. authorized agencies is called foreign remittance. The Sonali
Bank, Sylhet Corporate Branch, Sylhet provides following foreign remittance facility to its
customer directly.
Procedures for Western Union, Spot cash, Transfast, Xpress money: When the clients arrive
to receive cash, performs the following duties:-

a) Customers show pin number from the remitter abroad to the banker for payment. If 8
digits, it will be spot cash, If 16 digits, it will be Xpress money, if 10 digits, it will be
Western Union, If 13 digits, it will be Transfast,
b) The banker logs in that site and confirms payment by matching information and

c) Then the banker gives payment instrument and the customers collect money from cash
counter.
EFT and BFTN: From various countries, amount is directly transferred to the branch of
the clients. Now, share bonus, fund transfer and salary of government and private
organization are given through BFTN.

32
General Banking Activities of SBL
In Flow of Foreign Remittance of Sylhet Corporate Branch of SBL:

1. July 16, 2016 TK 14.68 million (TK 1,46,84,442)

2. August 16, 2016 TK 16.83 million (TK 1,68,29,556)
3. September 16, 2016 TK 15.55 million (TK 1,55,54,780)
4. October 16, 2016 TK 16.92 million (TK 1,69,21,472)

[4 Months]
17.5

17
16.83 16.92
16.5

16

15.5
15.55
15

14.5 14.68
14

13.5
July August September October
In flow of foreign remittance of Sylhet Corporate Branch (in million taka)

Chart: In flow of Foreign Remittance of Sylhet Corporate Branch

4.1.3) Bills and clearing section

Bills Section: This section is very critical and complex. It carries risk. In Sylhet Corporate
Branch a Senior Principal Officer named Mr. Subroto Muhon Kor is charged with this section
that is well-experienced and skilled enough to deal such complexities.

Customers pay and receives bill from their counter party as a result of transaction. SBL
collects bill on behalf of their customer. Collection mechanisms in SBL are clearing, outward
bill for collection (OBC), inward bills for collection (IBC).

 Outward Bills for Collection (OBC): When a particular branch receives bills from its
local parties or banks and sends those to an outstation branch or bank for collection, the
bills are considered outward bills for that particular branch.

33
General Banking Activities of SBL
 Inward Bills for Collection (IBC): When the bills are received by a branch either from a
outstation branch, bank or parties direct for collection and remittance of the proceeds, the
bills are considered inward bills for the particular branch.

Clearing Section: Clearing is a system by which a bank can collect customers fund from one
bank to another through clearing house. Clearing section plays a vital role in general banking.
This section receives cheques, DD, PO etc from depositors attached with a deposit slip. Then
instruments are posted the Nikash Computer. After posting this instruments are segmented
bank wise. The Clearing House sits twice daily on all working days. The first clearing is held
in the morning and the second clearing in the afternoon. Time for both the clearings are
predetermined. Change in timing, if any, is advised from time to time by Bangladesh Bank
and Sonali Bank. In the first clearing representative of each member banks delivers
instruments drawn on rest of the banks and receives instruments of other banks drawn on
itself. Cheques or instruments returned unpaid are delivered to the respective representative
along with returning memo in the second clearing.

4.2) LOAN AND ADVANCE DEPARTMENT

Credit section is the heard of the banking activities, because the main bank profit comes
from this section. For a short duration of internship I was not set up for long time in this
department and ultimately did not get opportunity to gain more idea about this department.

 Duties of the loan and advance

In the Sonali Bank ltd offer lot of loan side in the real life and business life, such as-
Consumer loan, Staff House Building Loan, Auto loan for bank top level employees like
AGM, Personal loan, Micro credit etc. From my 3 months internship program it has been
cleared to me that loan defaults are the main risk of Loan Department, sometimes customers
take the loan and one or two installment will be but next time and there are not payment their
installment. So this is main fall of earning this should be very care full process and the leady
process. The following work to do in this department:-
1) Loan types,
2) Information required for preparing the loan proposal,
3) Documents required for preparing the loan proposal and
4) Important aspect of the loan sanctioning

34
General Banking Activities of SBL
4.3) FOREIGN E XCHANGE DEPARTMENT:
Foreign exchange means foreign currency. If we consider Foreign Exchange as a subject then
it means all kinds of transaction related to Foreign currency as well as currency instruments
such as DD, TT, TC, Payment Order & Foreign Trade. In other wards Foreign Exchange
deals with foreign Financial Transactions.
 Duties of the Foreign Exchange

For a very short span of time, I did not get such opportunity to work at Foreign Exchange
Department; ultimately to study on the activities of the department. From my little experience
I have just known that there are 3 kinds of Foreign Exchange Transactions in Sylhet
Corporate Branch. They are:-

- Import
- Export
- Foreign Currency Account

4.4) LEARNING POINTS

I have learnt following things from Sonali Bank Limited, Sylhet Corporate Branch, Sylhet:-

 To learn how to open an account (current account, saving account and short-term deposit
account);
 How to issue Cheque book;
 How to give intent for MICR cheque book;
 How to issue DD;
 How to issue PO;
 How to issue MT;
 How to issue TT;
 How to entry passport fee;
 What types of requirement are necessary for loan;
 How pay cash account holder and
 How to make a financial statement of passport Fees.

35
General Banking Activities of SBL
 36
General Banking Activities of SBL
 Chapter: 5
Application of Knowledge Gained During BBA Program

5.1) PRINCIPLES OF MANAGEMENT:

We studied this course at 2nd semester of our BBA Program. It helped me learn how to
manage works in most efficient and effective manner and maintain the chain of command
within the organization. While doing internship program, I was able to complete my all tasks
efficiently and effectively at the shortest possible time and maintain the chain of command.
5.2) PRINCIPLES OF ACCOUNTING: During my internship program I was able to make various
debit voucher and credit voucher by applying the basic concepts learned from Principles of
Accounting course which I studied at 2nd semester. It was also possible for me to make the
Financial Statement of Passport Fees for the year of 2013-2015 of the particular branch by
applying its theoretical concept.

5.3) BUSINESS COMMUNICATION :

Business Communication is a course which we studied at the 4th semester. During my
internship this course helped to be a good communicator by different types of communication
skills; like: writing, speaking, listening and interpersonal. Following are the cases in where I
needed these skills during Internship program:-

 To communicate with the branch employees,

 To collect information from the customers and clients and
 To write formal letter and application

5.4) BANKING AND INSURANCE AND BANKING LAW AND PRACTICE :

We have studied both courses at 7th semester and 10th semester respectively. It is a very
informative course for BBA students and its practical use is much more to do an internship
program especially in a bank organization. Firstly these courses give us a clear idea about
bank, banking, banker, customer, clients. By studying this course we have known about
different types of account; like-current account, savings account, fixed account, different
types of cheques; like- bearer cheque, crossed cheque, blank cheque, antedated cheque etc,
parties of cheque, inland remittance and foreign remittance, reason of dishonoring a cheque.
We have got a detailed idea about L.C. from these courses.

37
General Banking Activities of SBL
5.5) ORGANIZATIONAL BEHAVIOR (OB): Organizational Behavior is concerned with the
behavioral issues and I read it at 7th semester of 4 (Four) years BBA Program. It is a course
which comprises of all actions, norms, behavior which an individual needs to follow within
organization. This course made me aware about conduct in the corporate field. During
internship I needed the following things learned from this course:-

 Marinating office time properly

 Maintaining formal dress
 How to manage the customers in a diplomatic manner
 How to work in a team as well as an individual etc.

5.6) MANAGEMENT INFORMATION AND CONTROL SYSTEM (MICS):

Management Information and control enabled me to research this specific topic, analyse the
problem, think creatively, suggest a solution, and prepare a clear written presentation of the
solution and working individually to make the project. Studying this course at 8th semester I
also got a clear idea about 3 dimensions of information system that is quite needed to know
for workin excellently in the bank organization for an employee.
5.7) HUMAN RESOURCE MANAGEMENT (HRM):
HRM is a course which tells us about the process of managing human resource and this
course was studied at 8th semester. Though this course seems only necessary for higher level
employees like manager to maintain good performance by hiring the right people in right
place and motivating them to achieve organizational goal, it is also necessary for all
employees in case of maintaining ethics and integrity in the workplace.
5.8) BUSINESS RESEARCH METHOD:
Business Research Method is a course which is a field of practical study and we studied it at
9th semester. Studying this course I was able to obtain data and analyse them to make a
critical evaluation and to make the report a complete one. Following are the things learned
from this course by which I have benefited to prepare the report:-
 Different research methods,
 What are the relevant and legal source of data,
 How to collect data and information,
 How to filter the data and information,
 How to use facts and information for study,
 How to place right information in right place,

38
General Banking Activities of SBL
 To know and explain the purpose of the study and
 To identify the problems.

39
General Banking Activities of SBL
 Chapter 06

Management Performance

6. 1 Introduction

A bank is a financial institution which accepts deposits, pays interest on pre-defined rates,
clears checks, makes loans, and often acts as an intermediary in financial transactions. It also
provides other financial services to its customers.
Bank management governs various concerns associated with bank in order to maximize
profits. The concerns broadly include liquidity management, asset management, liability
management and capital management.
Management means the administration and the governing body that is concerning the whole
organization. All the decision and strategies are been proposed and evaluated the
management of the organization. At National bank, the management is pretty strong and there
is lot centralization in the whole network of the bank. The management at National bank has
been divided into 3 major parts i.e. Board of Directors, the Top management, and the group
of middle managers, supervisors and the employees.

6.1.1 The Board of Directors:

The upper most part of the management is the Board of Directors or the Executives. The Board of
Directors is responsible for the first phase of the management process, i.e. planning. So, all the
decisions and the strategies are being proposed and implemented under the instructions and the
supervision of the board of directors or the executives. Also the policies and the overall objectives of
the Bank are being proposed at this level of the organization.

6.1.2 The Top Management:

The top management involves the branch managers and the chief managers of the bank including the
operations managers as well. The major responsibilities include the strategy formulating for the bank
and supervising the whole staff at the branch. They define and interpret the objectives and vision and
then formulate policies for their completion.

6.1.3 The middle management, supervisors and the employees:

40
General Banking Activities of SBL
Departmental heads constitute this level of management at National Bank Ltd. They are directly
responsible for planning and controlling the activities of officers. Finally, the employee’s activities are
monitored and controlled according to the desired objectives.

6.2 Bank Management System

Bank Management System Accepting deposits, clearing checks, paying interest on pre-
defined rates and making loans; a bank can be defined by such activities. Besides being an
intermediary in financial transactions, a bank can provide other financial services to its
customers. All these tasks and services are coordinated by a system called Banking
Management System.
Yes, banking management system governs a variety of concerns associated with a bank’s
efforts to render services and maximize profits.
6.3 The Origin of Banking Management System
The need for a system, which could ensure quality services to customers, had always been
there. The need for such system becomes really indispensable when many banking activities
are monitored by the government. Banks that deal with banking activities on a larger scale are
the ones usually have to comply with the rules set by the government.
And, this requires a bank management system. The system has proved effective in
coordinating among the customers, the government and the banks.
It gives us a system in which the government is allowed to play an important role with its
control over the banking system. And, the bank can also offer quality services to the
customers.
6.4 Evolution of Banking Management System
Modern banking system caters to a wide range of financial services. Banking management
system can be traced back to the Roman Empire where banking management system was
practiced. But, the system wasn’t systematic. And, it didn’t have a framework as modern
banking system does.
So, banking management system evolved gradually in each and every sector of the banking
sector.

6.4.1 The Major Changes a Banking Management System of Today Faced:

Some of the major changes that occurred regarding modern banking system are as follows:

 Money replaced barter system, which produced transaction uniform

 To increase public trust, uniform laws were established

41
General Banking Activities of SBL
  Centralized banks were setup to manage other banks
 Book keeping transformed from papers to digital with the advent of computers
 ATM booths were established for easier withdrawal of money
 Internet banking system emerged with the introduction of Internet

6.5 Market Risk Management:

Market risk may be defined as the possibility of loss to a bank caused by changes in the
market variables such as interest rate, foreign exchange rates and market value of equities.
Market risks are broken down into various risk factors namely, foreign exchange risk, interest
rate risk and equity risk. Treasury division manages the market risk and the asset liability
committee (ALCO) monitors the activities of treasury division in managing the risk.
Market risk occurs due to changes:
 In the market level of interest rates,
 prices of securities,
 Foreign exchange and equities,
 The volatilities of those changes.
Financial institutions may be exposed to Market Risk in variety of ways. Market risk
exposure may be explicit in portfolios of securities equities and instruments that are actively
traded. Conversely it may be implicit such as interest rate risk due to mismatch of loans and
deposits. Besides, market risk may also arise from activities categorized as off-balance sheet
item. Therefore market risk is potential for loss resulting from adverse movement in market
risk factors such as interest rates, forex rates, and equity and commodity prices.
6.6 Empirical Analysis of Fund Management System:
To analyze the fund management I have analyzed of a bank’s Net Interest Income, Liquidity
Ratio (loan-deposit ratio), Return on Loans (ROL) and tried to compare with bank’s
profitability to find that whether there have any relations or not.

6.7 Problems in Loan Management:

Like all other banks, SBL provides loans to different parties for different purpose. The
recovery of all these loans is not certain. The loan which recovery is questionable is the main
problem in loan management. But it is possible for the bankers to prevent their loan program
from bad ones by detecting the risk elements with them and taking measures in time. For this
purpose, first of all, the authorized officer in loan section checks the loan application properly

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in order to choose the right person for providing the loan. He considers two factors to
determine whether the loan is good or bad loan.

6.8 Fund Management and its Impact on Profitability:

It is already mentioned that effective fund management depends on less cost and less volatile
fund. It also depends on the effective utilization of the collected funds. From the analysis, it is
already clear that current deposit is the least costly source of deposited funds whereas fixed
deposit is the most costly source of deposited funds. But current deposit is the most volatile
sources in nature and fixed deposit is the stable nature. Term deposit is consists of savings
and fixed deposit. So, for getting an appropriate source of fund structure, bank management
must make a balance between current and term deposit.

It can also use money market borrowing because it is less costly and flexible compared to
deposit. A bank can also rely on various off-balance sheet items for funding to its needs.
Fund management also depends on the effective use of the collected funds. Improper use
makes the collected funds burden for the bank. In this part, various ratios are analyzed both in
the context of interest cost of the funds and their effective utilization.
6.9 Principles of Risk Management of SBL:
The primary objective of risk management is the protection of a bank’s financial strength.
Risk management is based on the following principles:
 Protecting the bank’s financial strength: SBL controls risks in order to limit the
impact of potential adverse events, both on its capital and on its financial results. The
risk appetite must be proportional to the available capital.
 Protecting the SBL’s reputation: reputation is essential for the proper performance of
a banker’s profession and needs to be diligently preserved.
 Risk transparency: for a good insight into SBL’s positions, it is vital to identify all
risks. Risks must always be considered as accurately as possible in order to be able to
make sound commercial decision
 Management responsibility: SBL’s business entities are individually responsible for
their results as well as for their risks associated with their operations. A balance must
be found between risk and return, while of course duly observing the relevant risk
limits.
 Independent risk control: this is the structured process of ensure integrity, the risk
control departments operate independently of the commercial activities. In the normal

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 course of business SBL is exposed to various risks, in relation to the asset and
liability portfolio of the bank.
6.10 Training and Development
Training and development consists of three materials, they are:

 Orientation
 Training

 Development

Chapter: 7
Recommendation and Conclusion
71) RECOMMENDATION :
To survive in the strong competitive business earth and to cope with change, Sonali Bank
Limited needs to bring change in their operations. The bank is actually service organization
and the main objective of the world famous and successful organization is to make profit
through addressing the clients time to time with new pieces of services instruments.
However, from my three months working experience in Sylhet Corporate Branch of Sonali
Bank Limited at different department leads to recommendation on the following issues:-

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General Banking Activities of SBL
 i. Firstly, SBL should increase skilled manpower to do its financial activities more
efficiently and effectively. So that many of the employees do not have to do extra
work;
ii. The branch should be developed by increasing technology and the staff of the bank
should be qualified about technology by proper training;
iii. The entire general banking system of general banking division is not computerized for
which it takes much more time to open an account and to issue cheque book. If the
whole system is computerized, then the bank can satisfy its customers by providing
fast service;
iv. In this branch the sections of General Banking Department are not running by
manpower with high quality banking knowledge. Due to lack of skilled employees in
this department the branch is not getting a touch of rich customers;
v. The employees of different department cannot cope with the changes and maintain all
rules and regulation in accordance with new new circular provided by Bangladesh
bank and Head Office of SBL. Consequently this branch is getting objections more
than once time by internal auditor;
vi. There is lack of co-ordination among departments which hampers to deliver faster
service to customers. So to achieve organizational goal the branch needs synthesis
among personnel of all departments;
vii. Senior management and other personnel throughout the bank should work in a straight
forward manner as per regulatory norms of bank;
viii. The bank should decrease the loan sanction time;
ix. The bank's rules and condition are very strong in case of providing and collecting loan,
so the customer pays their loan for facing lots of problem;

x. The bank should be increased the number of ATM booth and the amount of Q cash
withdrawn from the booths and
xi. To get customer attraction, the branch decoration and the customer hospitality service
should be developed soon.

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General Banking Activities of SBL
 46
General Banking Activities of SBL
7.2) CONCLUSION:
Sonali Bank Limited is the largest commercial bank as well as the largest employer in both
the public and private sector in Bangladesh. Though the bank is playing an important role in
the socioeconomic development through the development of industrial sector and providing
all the conventional banking service as well as some specialized financing activities to the
economy period, it has also to do a lot of things for the country. It has to take initiative so that
it can fulfill the desire of the government and people and sustain valuable customers.
Consequently, it also needs to enhance more public services and to build up working teams. It
must be run in organized way and discipline must be ensured in all sphere of its performance.
Efficient export team, import team and remittance team must be formed and performed duties
properly. More training, computerization, data collection, market analysis and swiftness in
servicing are essentially required.
So in conclusion it can be said that to reach the pick of success by eliminating negatives the
bank can use the mentioned recommended suggestions. Because Sonali Bank Limited is near
to the heart of the people acting old heritage with new generation ensuring digital
Bangladesh. It has great impact on the banking business and other sectors of the economy.
For this government help is essential that government will broaden its hand for implementing
the recommendations for the welfare of the people of Bangladesh.

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General Banking Activities of SBL
 REFERENCE

 Debnath, R. M. (2004). Business of Banking. Dhaka: Lotus Publishers.

 Ali, S. A. & Howlader, R. A. (2009). Banking Law and Practice. Dhaka: New S R
Printing Press.
 Kumar, R. (2010). Research Methodology: A Step-By-Step Guide for Beginners. (PP.
80-97). USA: Sage Publications.
 Bryman, A. (2007). Business Research Methods. USA: Oxford University Press.
 Zikmund, G. W. (2009). Business Research Methods. (PP. 236-240). Cengage
Learning.
 Financial Performance Analysis of Sonali Bank Limited. Retrieved from
//www.assignmentpoint.com/business/financial- performance-analysis-of-sonali-
bank-limited.html
 General Banking Activities of Sonali Bank Limited. Retrieved from
www.academic.edu/13063352/General-Banking -Activities-of-Sonali-Bank-Limited
 Report on General Banking Activities of Sonali Bank Limited. Retrieved from
www.assignmentpoint.com/business/banking/report/-general-banking-activities-
sonali-bank-limited.html
 Report on General Banking Activities of Sonali Bank Bangladesh. Retrieved from
www.assignment point.com/business/finance/report-on-general-banking-activities-of-
sonali-bank-bangladesh.html
 Sonali Bank is an excellent website for this report (http://www.sonalibank.com.bd).

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