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To become a successful manager one must need a BBA degree. That is why, I admitted myself into International Islamic University Chittagong BBA program in Dhaka Campus. After completing consecutive eight semesters there is needed an internship program in partial fulfillment for the degree of BBA. In this circumstance, I have to attend an internship program. I choose Southeast Bank for my internship.
1.2 Rationale of this Study
The internship report is an integral part of the BBA program of every university. So it is compulsory to take such task by the students who desirous to complete and successfully end-up their BBA degree. It is also an opportunity for the students to minimize the gap of their theoretical and practical knowledge. Students are required to work on a specific topic based on their theoretical and practical knowledge acquired during the period of the internship program and then submit it to the teacher. That is why I have prepared this report.
1.3 Objectives of the Study
Following are the main objectives of this study:
- To identify the operational procedure of the bank.
- To achieve extensive knowledge about the management process of SEBL.
- To know overall services offering By SEBL to the Customers.
- To evaluate the foreign operations of SEBL.
1.4 Scopes of the Study
The scope of this paper is limited to the organizational structure, background, and objectives, functions, and investment performance of SEBL as a whole. The scope is also limited to the different activities of SEBL regarding to the customers, to the employees, to the shareholders and to the nation.
1.5 Limitation of the Study
There are some limitations in my study. I face some problems which are mentioning below:
- Lack of proper time: Time period of this study is really short. I have only 50 working days (almost 10 weeks) to spend in branch and to complete this report. So I am unable to go deep of the study. Most of the time the officials were busy and were not able to give me much time.
- Insufficient data: Some desired information could not be collected due to privacy of the business.
- Lack of Monitory Support: Few officers sometime felt disturbed, as they were busy in their job. Sometime they didn’t want to supervise me out of their official work.
- Others limitations: As I am newcomers I have little experience in this regard. And many practical matters have been written from our own observation that may vary from person to person.
1.6 Methodology of the Study
There are two sources of collecting data. They are: Primary Data and Secondary Data. These sources are given here.
The primary sources of my information are given below:
- Direct observation
- Questionnaire to the executives
- Opinion of the respective persons
- Practical applications of the organization
The secondary sources of my information are given below:
- Websites of the organization
- Reports of the organization
- Written codes of the organization
- Diary of Events of the organization
- Performance evolution report
2.1Southeast Bank at a glance
Name of the Company: Southeast Bank Limited
Chairman: Alamgir Kabir, FCA
Vice Chairman: Ragib Ali
Managing Director: Mahbubul Alam
Company Secretary: Muhammad Shahjahan
Legal Status: Public Limited Company
Date of Incorporation: March 12, 1995
Registered Office: Eunoos Trade Centre 52-53, Dilkusha C/A
(Level 2, 3 & 16), Dhaka-1000
Line of Business: Banking
Authorized Capital: Tk.10,000.00 million
Paid Up Capital: 3,422.64 million
Year of Initial Public Offer: 1999
Stock Exchange Listing: April 10, 2000 (DSE) & April 24, 2000 (CSE)
Phone: 9571115, 7160866, 7173793, 9555466 & 9550081
Fax: 99550086, 9550093 & 9563102
2.2 History of SEBL
Southeast Bank Limited was established in 1995 with a dream and a vision to become a pioneer banking institution of the country and contribute significantly to the growth of the national economy. The Bank was established by leading business personalities and eminent industrialists of the country with stakes in various segments of the national economy. The incumbent Chairman of the Bank is Mr. Alamgir Kabir, FCA, a professional Chartered Accountant. Mr. M. A. Kashem a member of the Board and Mr. Yussuf Abdullah Harun were past Presidents of the Federation of Bangladesh Chamber of Commerce and Industries (FBCCI).
Southeast Bank is run by a team of efficient professionals. They create and generate an environment of trust and discipline that encourages and motivates everyone in the Bank to work together for achieving the objectives of the Bank. The culture of maintaining congenial work – environment in the Bank has further enabled the staff to benchmark themselves better against management expectations. A commitment to quality and excellence in service is the hallmark of their identity.
Southeast Bank takes pride for bringing women into the banking profession in a significant number for gender equality. At present, 32% of Southeast Bank employees are women that will rise to 45% over the next five years.
2.3 Diary of Events
|Certificate of Incorporation||March 12, 1995|
|Certificate of Commencement of Business||March 12, 1995|
|Bangladesh Bank license||March 23, 1995|
|First Branch Opened||May 25, 1995|
|Dividend offered in 2008||35%|
|Number of Branches||68 as on 01/06/2010|
|Number of Employees||1419 as on 01/06/2010|
|Global Correspondents||589 as on 31/12/2009|
|Listing of Shares||DSE & CSE|
Financial Stability (Taka in million)
|Authorized Capital||December 31, 2009||10,000.00|
|Paid – up Capital||December 31, 2009||3,422.64|
|Total Capital (Tier I + Tier II)||December 31, 2009||9,927.16|
|Deposit||December 31, 2009||96,669.05|
|Advances||December 31, 2009||77,497.57|
|Investments||December 31, 2009||21,350.23|
|Operating Profit||December 31, 2009||4,614.66|
|* Initial public offering of shares of Tk. 150.00 million was completed in 1999|
2.4 The Strategy of Southeast Bank Limited
Southeast Bank believes that its effort to become a leading bank in the private sector can only be achieved and sustained by creating effecting corporate governance, including professionalism among its stuff and strictly adhering to rules and regulations. SEBL believe that aims and objectives can only be realized fully and sustained over time by adherence to ethics that can not always to build into sets of rules and regulations. This believes in ethics motivates the bank in its dealing with those with whom it interacts.
2.4.1 SEBL adheres to the following principles in dealing with customers.
a) Strictly follows ethical banking practices.
b) Provide fair treatment to all customers, depositors and borrowers without any discrimination.
c) Provide speedy customer service at a very competitive cost.
d) Deal with customers in a transparent manner and without any hidden cost.
e) Maintain strict secrecy of customer account.
f) Provide free financial advice to clients.
g) Deal quickly with complaints received from the customers. SEBL endeavor continuously to build trust and understanding with customers.
h) SEBL give very competitive return to the depositors on their investment.
i) They listen to their customers and work for improvement of customer service as per their suggestion.
j) They never desert their customers in adversity.
k) SEBL always keep promises as they make.
2.4.2 SEBL follows the following principles in dealing with Shareholders.
a) Adequate disclosure of corporate information and operational results to help them take suitable investment decisions / options.
b) Stable dividend policy and payment of good dividend.
c) Dialogue with them and implementations of their suggestions for improvement.
2.4.3 SEBL follows the followings in dealing with their regulators.
a) They are transparent in operations and governance.
b) SEBL have a culture of timely compliance of regulatory requirements.
c) SEBL give their suggestions and directives great value that they implement for improvement of corporate governance standard.
2.4.4 SEBL follows the following principles in dealing for their Employees.
a) No discriminate on grounds of religion, sex or race at any stage. They recruit the best on the basis of merit under a rigorous recruitment policy without any biasness or favoritism to anybody.
b) Pay competitive compensation package with career echelon for the really deserving candidates.
c) Care for employees and respect them.
d) Clearly defined duties and responsibilities for every employee. No one is made a scapegoat for undefined responsibilities.
e) Zero tolerance for any act of dishonesty.
f) Provide a congenial work environment.
g) Encourage freedom to employees to give opinion for both qualitative and quantitative improvement of the bank.
h) SEBL always take care of their health and safety.
2.4.5 SEBL follows the following principles in respect of society.
a) SEBL believe that the bank gets business sustenance from the community in which it operates and therefore must remain responsive to the community and the society in reciprocity.
b) Do not encourage projects which are not environment friendly for financing by the bank.
c) Provide material support for protection of environment.
d) Give aid to the poor helpless and natural calamity hit people.
e) Support charitable ventures.
f) Support the women as a community and contribute to women empowerment.
g) Give sponsorships to sports culture education health care and community development ventures.
3.1 Capital and Reserve
The Authorized Capital of the Bank was Tk.10,000.00 million and Paid-up Capital was Tk.3,422.64 million as of December 31, 2009. The Capital and Reserve of the Banks in 2009 stood at Tk.9,927.16 million compared to Tk.7,657.01 million of the previous year showing an increase of 29.65 percent.
3.2 Capital Adequacy Ratio
The Bank maintained a capital adequacy ratio of 11.72 percent of the risk-weighted assets as on December 31, 2009 as against the requirement of 10 percent as set by Bangladesh Bank under Basel-I reporting.
3.3 Shares and our Shareholders
The fundamentals, such as Price Earning Ratio, Dividend Yield, Net Asset Value, Net Operating Cash Flow Per Shares, Value of Traded Shares, Positive Earning Per Share, continuous presence in Stock Exchanges as ‘A’ category shares, regular declaration of attractive rate of dividend, number of shareholders, higher percentage of market capitalization in terms of Paid-up-Capital, etc. all are positive in case of shares of Southeast Bank Limited.
i) Number of Shareholders
The rising trend in number of shareholders of the Bank since IPO is continuing and at the end of the year, the number of shareholders of the Bank stood at 22,152 while it was 12,536 as on December 31, 2008. It posted an increase in number of shareholders of the Bank by 76.70%.
ii) Positive Earning Per Share (EPS)
At the end of the year 2009, the number of outstanding shares of our Bank stood at 3,42,26,373 shares. I have 30,00,000 shares at the time of listing with Dhaka Stock Exchange and Chittagong Exchange in 2000. I have issued 3,12,26,373 shares in the form of Bonus Shares and Rights Shares after listing with stock exchanges, showing 1040.88% increase in number of Bank’s outstanding shares.
iii) Satisfactory Net Assets Value (NAV)
Our Bank’s assets are greater than liabilities with very satisfactory Net Assets Value (NAV) per share. The NAV of the Bank per share in 2009 stood at Tk.331.01 while it was Tk.257.95 in 2008, recording a significant growth of 28.32%.
iv) Authorized Capital and Paid-Up Capital
At the time of incorporation in 1995, the Authorized Capital of the Bank was Tk.500.00 million and the initial Paid Up Capital was Tk.100.00 million. At the end of 2009, the Authorized Capital and Paid Up Capital of the Bank stood at Tk.10,000.00 million and Tk.3,422.64 million respectively. The Authorized Capital and Paid Up Capital since inception of our Bank have been increased by 1,900% and 3,322.64% respectively to maintain sound capital adequacy of the Bank and to make the Bank financially stronger.
v) Declaration of Dividend
The Bank continuously pursues a stable dividend policy and declares dividends to the shareholders at an attractive rate. To cope with the requirement of increased capital of the Bank with the growth of volume of business, bonus shares were issued out of the profit generated by the Bank.
vi) Rights Issue of Shares of the Bank
As approved by the Shareholders in the 5th Extra Ordinary General Meeting of the Bank held on September 24, 2009, Rights Share @ 1R:2 Shares will be issued in favor of Shareholders of the Bank at an issue price of Tk.160/- each with a premium of Tk.60/- per share subject to approval of regulatory authorities. The Bank has so far issued 1,22,13,696 Rights Shares to the Shareholders to increase the Paid Up Capital of the Bank out of which 16,50,000 Ordinary Shares were issued as Rights Shares to the Shareholders at par at the ratio of 1R:2 in the year 2003 and 1,05,63,696 Rights Shares were issued to the Shareholders in the year 2006 at the ratio of 1:1 at issue price of Tk.200/-each with a premium of Tk.100/- per share to raise the capital base of the Bank.
The Bank focuses on the principles of sharing good achievements with the respected Shareholders. Accordingly, the Board of Directors recommends 35 percent Stock Dividend (Bonus Share) for the year 2009. The Bank’s priority is to increase shareholder value by enhancing the overall earnings of the Bank.
The Bank mobilized total deposits of Tk.96,669.05 million as of December, 2009 as compared to Tk.68,714.67 million in 2008. Competitive interest rates, attractive deposit products, deposit mobilization efforts of the employees and confidence reposed by the customers in the Bank are the factors that contributed to the notable growth in deposits. The Bank introduced a number of attractive deposit schemes to cater to the requirement of small and medium savers.
3.6 Credit Policy
The Bank has an exhaustive credit policy which is periodically reviewed and updated, under which all the functions of credit operations and management are carried out. The credit policy broadly includes and provides the Bank with the guidelines on the following aspects of credit:
• The permissible sectors/eligible businesses to finance
• The Application Process
• Analysis of credit risk
• Loan structure and terms
• Documentation / Communication
In addition to the above, to cater to the needs of the financing requirement in specific sectors, separate schemes like (i) Consumer Credit Scheme (ii) SME Credit Scheme (iii) Agricultural Loan Scheme (iv) Scheme for financing in Leather Sector etc. have been devised as per policy and guideline of Bangladesh Bank from time to time.
3.7 Human Resource Division
Human resource is the prime and single most valuable asset for a financial institution like a bank to attain its ultimate goal. Keeping this idea in mind, the Bank has adopted a comprehensive human resource policy as regards recruitment of employees, acquiring their services, developing their skill, motivating them to perform with excellence, maintain high morale and ensuring that they remain committed and devoted to the organization to achieve organization objectives. An organization requires competent managers and employees coordinating their efforts towards achievement of grand success. To ensure this need, Human Resources Division of Southeast Bank developed the finest team with full of competence in banking in the last fifteen years. It provides an excellent working environment for the employees to improve their team spirit, work excellence and creativity.
The Bank follows a structured recruitment policy based on qualifications and merits for fresh and experienced job aspirants. They are recruited in the Bank through a rigid but transparent process and the best are screened out from the bulk candidates. The division tirelessly gives full efforts that the right number and right kind of people are in the right places at the right time, capable of efficiently and effectively completing those tasks which help the organization to maintain good asset quality and fulfill the conditions of the regulatory authority. Total manpower strength of the Bank as on December 31st 2009 stood at 1402 of which 113 were executives, 1141 were officers and 148 were subordinate staff. The bank recruited total 277 employees of which 63 were experienced bankers and 214 were fresh entrants in the year 2009. The Bank also promoted 178 officers during the year 2009.
The division took massive initiative to train its manpower in the year 2009 to equip themselves with the techniques of modern banking. Total 107 Nos. of training, workshops, seminars were held at SEBL own training institute as well as in BIBM and other Govt and semi Govt institutes. The Bank also accommodated 181 interns for doing internship program from different Universities of the country. Attracting and retaining quality human resource is the most important aspect of Human resource policy. In this regards, Southeast Bank is generous enough to declare a good amount of bonus as incentive in every year. Employees of the Bank also enjoy working in a workplace which is comfortable, flexible and rewarding. To ensure social security, the Bank has implemented the policy of gratuity, contributory provident fund, encashment of unveiled leave etc. The Bank takes good care of their health and safety.
3.8 Information Technology
The bank has taken number of major initiatives to modernize its IT infrastructure, notably implementation of Core Banking Software (CBS), modernization of Wide Area Network (WAN) infrastructure, establishment of Data Center (DC) and Disaster Recovery Site (DRS). Under the modernization initiatives of IT infrastructure, the bank has rolled out a centralized web based solution for its CBS known as BankUltimus. The BankUltimus is a web based banking system which is bundled with world’s most modern and reliable relational database Oracle and secured UNIX operating system called Sun Solaris. The system has got many modules to cater newer services and introduction of newer products with minimum lead time. The system allows integration with the multiple channels and interfaces such as ATM, Internet Banking, Mobile Banking, SWIFT, CallCenteretc.