The banking sector of Bangladesh is the largest service sector of Bangladesh. The growth of this sector is emerging. Almost all the banks are improving year after year. But, the growth of a bank depends mostly on credit management of the bank.
Commercial banks lend money to different categories of borrowers for various purposes with a view to generate revenue. Accordingly, while processing and appraising a loan proposal, banks essentially analyze the information relating to borrowers, assess the purposes of loan and determine the viability of the loan proposal. If the proposal is sound and safe for lending, loan is sanctioned and disbursed.
The report discusses about the different credit facilities, approval process, monitoring and performance of the bank under study.
This report is categorized in eleven different chapters. In chapter one introduction, purpose, objective, scope, methodology, limitations are discussed. Chapter two focus shortly on history of banking in Bangladesh. Chapter three narrates the company profile. Chapter four concentrates on the theoretical aspect of credit management. Chapter five describes credit policy. Chapter six describes in detail about the utilization of funds raised by the bank. Chapter seven, eight and nine concentrate on disbursement procedure, recovery performance of loans, problems in loan recovery, classified loan, and provision required for classification etc. Guidelines for credit management are highlighted in the tenth chapter. Evaluation of credit management of Uttara Bank Limited is in chapter eleven of the report. Finally, findings and concluding recommendations are given at the end of the report. The main objectives of the report are identifying the credit approval and monitoring and the overall performance.
After liberation war it was changed to Uttara Bank Limited. It issued its share through stock exchange and named as Uttara Bank Limited. At first Uttara Bank Limited was established in 1964 named as an EASTERN BANKING CORPORATION. Uttara Bank is one of the largest and oldest private sector commercial banks in Bangladesh with years of experience. Adaptation of modern technology, both modern equipment and banking practice ensure efficient service to their customers. Within 211 branches at home and 600 affiliates worldwide create efficient networking and well capability. UTTARA Bank is serving both clients and country. It started its banking business through opening of import letters of credit in favor of foreign suppliers on behalf of various import clients. After starting operation as a commercial bank from November 1, 1985 on words, side by side with the traditional products it also started providing all types of foreign exchange related services to its different categories of clients. As such the establishment of a strong international division was felt since the very inception of the bank. The division has been managing by executives and officers who are well conversant with foreign exchange related to operations so that branches dealing in foreign exchange related transactions could get all the supports from the head office , besides giving international trade related support to the branches the division is responsible for proper maintenance of the nostrum accounts for investment of excess foreign reserves , for ensuring proper compliance of the foreign exchange regulation by the branches handling foreign exchange business
Scope of the Study
This study covered “the analysis of different services of Uttara Bank Ltd, New Market Branch, based on internship experience and customer’s opinion”. Such as-
- In this study only include the relationship of the customer with the bank as well as the principals covered by the bank as a general banking system.
- Analysis of different services.
Objectives of the Study
The study objectives are divided into general objective and specific objective.
General Objective: The main objective of the study is to analyze the different services of Uttara Bank Ltd, New Market Branch, based on internship experience and customer’s opinion.
Specific Objectives: The specific objectives are summarized below:
- To know the different services of Uttara Bank Ltd, New Market Branch.
- To know the accounts opening and closing procedure of Uttara Bank Ltd.
- To know the cheque book issuance procedure to customers.
- To know the local remittances collection procedure of Uttara Bank Ltd, New Market Branch.
- To know the different types of loans and its amounts.
- To know the customers opinion about its different services.
- To make some comparison of different service quality of other bank.
- And to make some recommendations based on the findings.
Methodology of the Study
The data that are used in this study are collected from both primary and secondary sources. Some essential points of the source are listed according to their relevant components.
Sources of Data and Data Collection Method
Primary sources of data:
- Conversation with the customers of this bank.
- Face to face conversation with the bank officers and staffs.
- Personal observation.
Secondary sources of Dat:
- Annual report of Uttara Bank Limited.
- Branch Monthly Report.
- Web site of the Uttara Bank Limited, Website address (www.uttarabankbd.com)
- Annual report of Brac Bank and Jamuna Bank.
- Files and document of the branch.
All officers and clients of Uttara Bank Ltd, New Market Branch.
bank officers and 80 clients of UttaraBank Ltd, New Market Branch.
Limitations of the Study
The study was completed under certain constrains which were:
- Difficulty in communication and gaining accesses to financial sector.
- Non-availability of the most required data.
- Inexperience was one of the most important factors that have constituted the limitation of the study. So due to inexperience, the required approach might not be followed to prepare this study.
- For the restriction to disclose various information of a Bank. So for this it was a great difficulty in preparing the report
History of the UBL
At first Uttara Bank Limited was established in 1964 named as an EASTERN BANKING CORPORATION. After liberation war it was changed to Uttara Bank. In 1984 it issued its share through stock exchange and named as Uttara Bank Limited. Uttara Bank is one of the largest and oldest private sector commercial banks in Bangladesh with years of experience. Adaptation of modern technology, both modern equipment and banking practice ensure efficient service to their customers. Within 211 branches at home and 600 affiliates worldwide create efficient networking and well capability. UTTARA Bank is serving both clients and country. It started its banking business through opening of import letters of credit in favor of foreign suppliers on behalf of various import clients. After starting operation as a commercial bank from November 1, 1985 on words, side by side with the traditional products it also started providing all types of foreign exchange related services to its different categories of clients. As such the establishment of a strong international division was felt since the very inception of the bank. The division has been managing by executives and officers who are well conversant with foreign exchange related to operations so that branches dealing in foreign exchange related transactions could get all the supports from the head office , besides giving international trade related support to the branches the division is responsible for proper maintenance of the nostrum accounts for investment of excess foreign reserves , for ensuring proper compliance of the foreign exchange regulation by the branches handling foreign exchange business.
Profit of the UBL
|Name of the organization:||Uttara Bank Limited|
|History:||1984, issued market share & named Uttara Bank Limited|
|Year of establishment:||1964, named Eastern Bank Corporation|
|Nature of organization:||Private Commercial Bank.|
|Shareholders:||Main shareholders include leading Industrialists and business magnets of the Country. The Board of Directors consists of 13 members. Most of the directors are Owner of large business groups.|
|Customers:||Business Enterprise and Individuals|
|Head office:||Uttara Bank Bhaban, 90, Motijheel Commercial Area, Dhaka, Bangladesh|
List of the UBL Branches
|Corporate Offices ( Corporate Branch & Local Office )||2|
|Total Branches ( Including Corporate Branch & Local Office )||207|
|Authorized Dealer Branches||38|
|Treasury & Dealing Room||1|
Uttara Bank will be a unique organization in Bangladesh. It will be a knowledge-based organization where the Uttara Bank professionals will learn continuously from their customers and colleagues worldwide to add value. They will work as a team, stretch themselves, innovate and break barriers to serve customers and create customer loyalty through a value chain of responsive and professional service delivery.
Continuous improvement, problem solution, excellence in service, business prudence, efficiency and adding value will be the operative words of the organization. Uttara Bank will serve its customers with respect and will work very hard to instill a strong customer service culture throughout the bank. It will treat its employees with dignity and will build a company of highly qualified professionals who have integrity and believe in the Bank’s vision and who are committed to its success. Uttara Bank will be a socially responsible institution that will not lend to businesses that have a detrimental impact on the environment and people.
To provide high quality financial service
- To provide excellent quality customer service
- To maintain corporate and business ethics.
- To become a trusted repository of customers money and their financial advisor.
- To make their stop superior and rewarding to the customers.
- To display team sprite and professionalism.
- To have a sound capital base.
This Bank is one of the most disciplined Banks with a distinctive corporate culture. Here we believe is shared meaning, shared understanding and ashamed making. Our people can see and understand events, activities, objectives and situation in a distinctive way. They mould their manners and etiquette, charter individual to suit purpose of the Bank and needs of the customer who are of paramount impotence to us. The people in Bank see themselves as a tight knit team/ family that believe in working together for growth. The corporate culture we belong has not been imposed; it has rather been achieve thought our cooperate conduct.
Nature of the Business
UBL is a progressive commercial bank in private sector in Bangladesh. It creates a new opportunities for it clients. It gives customized service and harmonious bank-client relationship. It contributes toward formation of national capital, growth of saving and investment in trade, commerce and industrial sectors. It provides different types of commercial banking and service to the customer of all strata in the society with in the stipulation laid down in the Bank Company Act 1991.
Goal of the Bank
- To become the leading profitable bank.
- Long term goal: To maximize the wealth of the shareholders.
- Short term goal: To earn satisfactory rate of return on investment by providing wide range of banking service.
For any financial and non financial organization, Management is the most valuable and important resource of any kind of organization. And a well organization management provides the organization to reach its ultimate goal. Management means planning, organizing, staffing, directing and controlling of all financial or non financial resources of the organization. Different aspect of management practice in Uttara Bank planning, organizing, staffing, directing, and controlling, human resource practices and recruitment finally.
Organization Hierarchy of Uttara Bank Ltd
Service is any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything.
According to the Oxford Advanced Learner’s Dictionary, customer is the organization or person that buys something from a shop or business or the organization or people being engaged in the same job.
Various Customer Services of UBL
Customer service or client service is the provision of service to the customers before, during and after a purchase of product. In other words, customer service is meeting the needs and expectation of the customers as defined by the customer.
Customer service also means of always going beyond the expectation of the customers. Customer service may be provided by a person (e.g. sales & service representative) or by automated means called self service (ATM, internet etc.).
The core of banking business is the satisfaction of customers need. Customer service in bank refers to the systemized and planned efforts by a banker to satisfy the customer needs with an ultimate objective of carrying customers trust & confidence.
Service to customer is based not just on systems, processes & procedures but also on personal effort and creativity of those who serve. Encourage, support and reward personal initiative in exhibiting creative ways to serve others both inside and outside the organization.
Customer service, like a brand, is what the customer perceives and remembers of the service they received. So the customer needs must be known clearly if an organization wants to meet up those.
New Market Branch of Uttara Bank Limited has provided various customer services. These are as follows:
General Banking is the starting point of all banking operation. It is a combination of activities of different services.
General banking provides some services to the customers. These services are as follows:
Accounts Opening Service
Issuance of Cheque Books Service
Account Closing Service
Accounts Opening Service
Opening account with a bank is the way of creating a banker customer relationship. In other words, it is a contract between banker and customer. With this contract, bankers enter into certain obligations and responsibilities.
Proper introduction serves as a precaution against fraud and forgeries and safeguard against inadvertent overdraft to bank. Obtaining proper introduction may absolve the banker from the charges of negligence for conversion. So, while opening a new account, emphasis would be given without exception to introductory reference and inquiry. The following instruction to be followed while opening account: –
1) Introduction of Account to be obtained from a respectable client acceptable to bank.
2) The introduction shall be obtained in writing in the respective column of Account opening form.
3) For opening savings bank account of individual either singly or jointly, passports and identity cards may be accepted for introduction, but subsequently proper introduction may be obtained.
4) Introduction of Current Account by members of the staff may be allowed but shall be discouraged as far as possible.
5) Current Account shall preferably be introduced by another Current Account holder acceptable to bank.
6) Introduction of Account holder of other branch may be accepted with caution. In that case the introducer’s signature must be verified by authorized officer of that branch and authenticated by a forwarding letter.
7) Photographs of account holder must be attested by the introducer.
Receipt of Cash Service
Cash may be deposited either by deposit Slips for SB/ CD/ CC accounts or by other credit voucher like single credit voucher, pay order/ Draft/ T.T. application forms. Branches shall ensure the following:
1) Cash receiving officer shall check the deposit slip/ credit voucher/ application form as to its title of account, number and amount in words and figures.
2) The cash currency notes shall be counted physically /by cash counting machine as per denominations of the currency notes on the back of the voucher /deposit slip. The officer will enter the particulars in the cash Receiving Register and sign on the related deposit slip/voucher and affix “Cash Received” Stamp with date. He/she shall write the amount in words and figures in red ink across the deposit slip/voucher/ application form in token of receipt of the money. He /She shall send the register along with the deposit slip/voucher for signing on the same and authenticating the receipt in the register by the in-charge of the department.
3) The officer in-charge shall retain the original of deposit Slip and other vouchers and send them to respective desk for postings/actions. The duplicate voucher (counter foil) shall be handed over to the depositor/client.
4) At the close of business the cash receiving officer shall add all the entries in the register and if agreed with the actual cash received by him, shall hand over the register for checking by officer-in-charge.
Payment of Cash Service
Cheques, Cash Debit Vouchers, Fixed Deposit Receipts, Monthly Term Deposit Receipts, Bearer Certificates of Deposit, Demand Drafts, may be placed for payment at the counter by clients, beneficiaries and various departments for encashment. Branches shall ensure the following:
1) The instrument is checked for any apparent discrepancy and evidence of posting and cancellation.
2) Specimen Signature of cancellation officer shall be available with cash paying officer for convenience of payment.
3) On being satisfied, the cash paying officer shall count cash for payment and the denominations of notes are written on the reverse of the instrument invariably.
4) Signature of the bearer is obtained on the reverse of the instrument and compared with the signature already obtained from the bearer while presenting the instrument.
5) If the presenter is found to be the same person, cash is handed over to the bearer/presenter.
6) “Cash Paid” Stamp is affixed on the face of the instrument and signed by the cash paying officer.
7) Particulars of the instrument are entered in the cash payment register.
8) Paid instruments are preserved with the cash paying officer.
9) At the close of bank hour, the amount entered in the cash payment register is totaled. The total must agree with the totals of cash paid.
10) The total is written in the cash payment register in words and figures.
11) The officer-in-charge of cash department shall check the entries and instruments to ascertain that the payment has been made correctly and shall release the instruments from cash payment register by his initials against each entry in the cash payment register.
12) The officer-in-charge also checks and signs the entries.
13) The cheques/instruments are sent to accounts department for stitching and preservation.
Clearing means settlement but from banking point of view it refers to the procedure of receipt and payment of proceeds of cheque and other instruments through banks. Delivered and received the mutual obligations between bank are ascertained and settled through their respective bank accounts maintained with the central bank or any other bank which conducts the clearing house.
Outward Clearing Service
All cheques, demand drafts and other credit instruments tendered for the credit of customers account will be delivered by the depositor at the clearing counter. Any deposits received by post will also be sent over to the clearing counter. The counter officer shall at the time of receipt examine such deposits carefully to ensure that:
- The name of the account is very clearly written on the Deposit slips.
- The particulars of deposits such as cheque numbers, names of bank etc. are properly entered on the deposit slip.
- The depositor has signed the Deposit Slip.
- On item deposited payees discharge and the chain of endorsement, are in order.
a) All cheques and other instruments will be crossed immediately on receipt with the banks special crossing stamp. Items intended/selected for the next day’s clearinghouse will be branded with the bank’s clearing stamp with date. If the deposits are made at a time when it is too late for these to be presented to drawee banks the same days the stamp “Too late for to days clearing” will be affixed on the counter foil.
b) All these slips are summarized in a bigger computer print out which reflects in details the instruments etc. presented by the bank to Clearing House and contains the names and account number to which the credits will be posted. These sheets serve the purpose of a Clearing House Register.
c) Bank also prepare, another summery sheet from computer which contain the total a number of cheques etc. delivered to different banks in the Clearing House and cheques received from different banks with correct total of amount.
d) The Credit vouchers should then be released for positing in the computer. It will be the responsibility of Deposit Department, however, not to allow any drawings against such items before the fate is definitely known. Reversal entries for any clearing item returned unpaid should invariably be made by a separate debit voucher.
e) All clearing item will be passed through the bank’s Local Office/Main Branch’s Account with Bangladesh Bank.
f) Entries to be passed by Local office/ Main Branch.
Inward Clearing Service
a) Local Office/Main Branch shall receive cheques etc drawn on Uttara Bank Limited branches from the Clearing House. On receipt of the cheque etc. they shall segregate the same branch-wise and issue IBDA on branches against total amount of cheque etc. and shall arrange delivery of the UBL together with the cheques etc. within Clearing House time schedule.
b) Branches shall send the cheques dishonored by them supported by UBL issued on Local Office/Main Branch, within Clearing House time schedule for enabling Local Office/ Main Branch to return these instruments in the 2nd Clearing House.
Deposit is the foundation of the general banking. Deposit is just like a media by which clients can save or disburse the money under some considerations and become able to take loans from the bank .Deposit provides most of the raw material for bank loans and represents the ultimate sources of profit and growth. Deposit generates legal reserve. If legal reserve of a bank is not more, then new loans are created. If a bank contains higher deposit fund with lower interest and availability of enough deposit to make a fund to make enough loan according to the willingness of the bank that types of would be effective
Closing of Accounts Service
For different reasons, the account holder(s) may request for closure of his/ their account with the bank. On receipt of such letter of request for closure of account, the Manager should ascertain the reasons to satisfy himself that the constituent is not severing his relations for grievance from the bank which may possibly be redressed. If for genuine reason the account holder(s) approach for closure of his/their account, the following steps shall be taken:
a) The application shall be received together with unused cheque leaves.
b) The signature of the account holder shall be verified
c) The number of unutilized cheque leaves shall be noted on the letter.
d) The Manager shall approve closure of the account and ascertain liability position (if any) and closing charges at prescribed rate to be recovered.
e) The account holder may be requested to withdraw the balance on deduction of the charges. Other wise the balance payable may be paid by way of pay Slip / Pay Order in favour of the account holder
f) After closure of the account, “Account Closed” Stamp shall be affixed on the account opening form, S.S. Card and in the Account Opened and Closed Register with date under signature of an authorized officer.
g) The Account opening form together with S.S.Card and the request letter shall be retained in Account closed file to be maintained in branches for Current and Savings Accounts separately.
h) If the balance is paid by way of Pay Slip/Pay order, the debit advice may be delivered to the account holder either by hand.
i) The unused cheque leaves shall be destroyed by authorized officer and shall be recorded on the application for reference under joint signature.
j) The unused cheque leaves shall be entered in the A/C Opening Register and the running number of the account shall be drawn reducing the closed account on each day.
k) Bank charges tk. 230 as closing charge.
During my internship period from November 1 to February 1 the number of closing accounts are given below:
No. of. Saving Account
No. of Current Account
|November 1 to December 1|
|December 2 to January 2|
|January 3 to February 1|
Banker customer relationship
a. Behavioral area: Employees attitude towards customers, term Spirit
b. Motivational area: Employees remuneration & incentives, appreciation,
proper posting, promotion etc.
c. Operational Area: Quick counter service, personalized service
d.Procedural Area: Flexible in A/C opening, investment, processing and Sanction, documentation, easy-to-pay installment.
e. Technical Area: Use of modern technology, quick Communication system
f. Promotional Area: Employee training/ motivation, customers Get together, deposit mobilization program, Introduction of customer care center, front Office, customer comment card etc.
g. Organizational Area: Opening new branches/ wings/ booths, proper staffing,
Delegation of appropriate discretionary power to the Branches, space, lay out etc.
h. General Area: Physical facilities, e.g. Telephone, Bathroom, Ladies counter, sitting facilities etc.
SWOT can help management in a business discover:
- What the business does better than the competition
- What competitors do better than the business
- Whether the business is making the most of the opportunities available
- How a business should respond to changes in its external environment
The result of the analysis is a Combined of positive and negative factors for management to address:
|Positive factors||Negative factors|
Strengths of the Uttara Bank:
- A wide range business, industries, And sector constitutes the bank’s advance portfolio
- Uttara Bank developed smooth relationship with their clients and corporate business holders
- In case of services offered by all private banks in our country, Uttara bank has maintain it
- If the govt. has imposed some new rules regarding private Banks IFIC Bank easily meet
- Adopting uttara Banking concept gives a new dimension in their service
- The uttara Bank contribution toward countries GDP very handsomely
- Some loyal customer bring in new customer
- Reputation of the management
- Interaction of the employers with the top management
Weaknesses of the Uttara Bank:
Problem with general banking-
- Sometimes the branch manager authenticated the account with introducer, sometimes it is very difficult for the employee to void circumstances, which in turn bring question
- They have error regarding advice
- Sometime title of the account differ
Problem with cash:
- Because of unavailability of notes and coins they cannot give the proper service to the potential customer
- Big parties or for big amount parties wouldn’t tk.100 notes but the Bangladesh Bank issues mix notes
Problem with advance:
- In case of advances in different project the interest rate is too high
- Maximum parties have no financial strength
- Charges on loan loses day by day increase
- There are some mortgage problem
- In the advance department they have no they have shortage of skilled manpower
- On of the major problem the counter service is sometimes unsatisfactory because of not having enough employees for the counter
- Their ATM card division is not satisfactory to fulfill their commitment & ATM booth is not available
Opportunities of the Uttara Bank:
- Growing business in the South Asian Region
- Good financing position creating a good reputation for loan And borrowing
- Government support
- Evolution of e-Banking
- Online Banking service technols
Threats of the Uttara Bank:
- Lack of competitive in product
- High inflation rate in BDT
- Unstable economic situation
- Multinational bank
- Upcoming bank
- Contemporary bank Findings
When I was doing my internship at Uttara Bank, New Market Branch I have found some problems which are discussed in the following:
- Clients are satisfied to the officers of the Uttara Bank New Market Branch because they are very much friendly to the clients.
- In general banking department they follow the traditional banking system. The entire general banking procedure is not fully computerized.
- Uttara Bank gives lower interest rather than other bank.
- The bank does not have any credit card service.
- Customers are dissatisfied with the existing ATM service of the bank because the bank does not have its own ATM booth that requires extra ATM charge to the customers.
- Uttara Bank does not sufficient technology pc banking. As a result the branch uses floppy disk to transfer data from one branch to another branch as well as head office.
- UBL, New Market branch has no separate officer assigned to foreign remittance section or loan section that results longer processing time to perform remittance service.
- Some times officers are not available in their desk.
- The number of human resources is really insufficient to give services to huge number of customers.
- Each Employee job is not clearly defined.
- Sometime customers need to wait for long time.
- In New Market branch there is not enough place for the client.
Finally Most of the customers are not educated so they are not conscious about service quality. All the transactions of Uttara Bank are kept in a register, this bank does not follow online banking system but some customers have no problem in this regard because they do not know the benefit of online banking system.
- Bank should introduce fully computerized system service that will reduce time labor and cost also.
- The bank can pay some interest on its current account.
- The bank should launch some ATM booths to achieve customers’ satisfaction.
- The bank should provide online banking facility.
- The foreign remittance section or loan section should be maintained by separate officers.
- Officers should be available on their desk.
- The bank has to recruit enough employees to provide better service to the client
- The internal environment of the bank should be improved.
- The bank should offer more facility to the clients.
- Uttara Bank, New Market branch should improve its service quality.
Uttara Bank Limited is bank of new generation. Though I tried to include in my study about deposit, customer service and general banking, I followed their rules and regulation and tried to use them in my study to prepare this study with my best effort.
Though all departments and sections are covered in the internship program, it is not possible to go to depth of each activities of branch because of time limitation. Bank is an institution, which acts as a financial intermediary. Since bank collect deposit from various source by paying interest to them and grant loan to some other parties at high rate to interest then the interest paid to the depositor, the differences between the two interests is termed as the profit.
Uttara Bank Limited has started their journey in the year of 1964, named as Eastern Bank Corporation. They already have passed 47 years in banking Industry. They had to struggle a lot against the different economic, social, climatic and political unpleasant environments. So they have huge experiences about the overall environment of Bangladesh. For this reason, they are comfortably doing their banking activities.
Uttara Bank Limited plays a significant role in various fields of the economy, such as industry, trade and commerce, transportation, and deposit mobilization etc. They have a great contribution to the agricultural development of our country which is the most important for us. The bank also plays a crucial role in human resources development and creating new employment opportunities. It also under takes various social welfare activities for the betterment of the society and in this context; the bank has established the Uttara Bank Foundation. It has managed the employment for a large number of people in our country. It is another great contribution to the country.