Bank With Southeast Bank Limited (Part-3)

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Bank With Southeast Bank Limited (Part-1)

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Bank With Southeast Bank Limited (Part-3)

 

6.13 Corporate Social Responsibilities

Southeast Bank’s banking practice is based on a network of relationship with its employees, customers, suppliers, business associates, shareholders, regulatory authorities and the community.

The Southeast bank is fully committed to protect the interest of its shareholders. Their constructive suggestions are implemented for the betterment of the company. It releases enough disclosures for the information of the shareholders in the Annual Reports, half-yearly financial statements, the print and electronic media and in the Bank’s website. It always endeavors to enhance shareholders value by optimizing financial performance at least cost.

The Bank continuously strives to ensure that its operations are environment-friendly and discourages financing projects contrary to it. It is one of the leading participants in the beautification of DhakaCity. The beautification of the road-island from Russell Square to Manik Miah Avenue was done by the Southeast Bank.

Southeast Bank works to promote good community relations to foster a relationship of understanding, trust and credibility. It has a long history of support for charitable causes.

In 2009, Southeast Bank has spent Tk.24.75 million as donations for education, sports, art, culture, health-care, community development, relief operations etc. A senseless killing of valiant army officers was committed by the misguided BDR personnel at BDR Headquarters, Peelkhana, Dhaka on February 25, 2009. It widowed and orphaned innocent people and catapulted the affected families in distress and uncertainty.

Sl. No.

Name of Shaheed Army Officer

Monthly Contribution

Yearly Contribution

Widow of Shaheed Army Officer

1BA 1892Brig. General Md. Abdul Bari

Tk. 40,000.00

Tk. 480,000.00

Ms. Farhana Bari
2BA 1480Col. Md. Mojibul Huq

Tk. 40,000.00

Tk. 480,000.00

Ms. Nehrin Ferdousi
3BA 2324Col. Md. Mashiur Rahman

Tk. 40,000.00

Tk. 480,000.00

Ms. Zobaida Begum
4BA 2409Col. Kudrat Elahi Rahman

Tk. 40,000.00

Tk. 480,000.00

Ms. Loby Rahman
5BA 2605Maj.Md. Abdus Salam Khan

Tk. 40,000.00

Tk. 480,000.00

Ms. Mahbuba Begum
6BA 2806Lt. Col.Md. Lutfur Rahman

Tk. 40,000.00

Tk. 480,000.00

Ms. Munmun Rahman
7BA 3716Maj.Md. Mahbubur Rahman

Tk. 40,000.00

Tk. 480,000.00

Ms. Rita Rahman

6.14 National Economy

Southeast Bank has directly employed 1402 people in the service of the Bank. SEBL have also generated employments for thousands of men and women in the projects and industrial ventures established with our finance.

The credit policy of the Bank has also been so designed as to promote trade, commerce and industry which will ultimately contribute to the growth of national economy. It will also help creation of employment opportunities. By mobilizing deposits for the Bank, Southeast Bank has contributed to the formation of capital of the country.

SEBL has collected tax on interest/profit earning of the depositors for the public exchequer. Our Bank has been a conduit for bringing foreign remittance from Bangladeshi expatriates living abroad and thereby contributed to the overall foreign exchange reserve of the country.

Southeast Bank contributed handsome amounts to the national exchequer in the preceding years as corporate tax.

7.1 Export Development Fund (EDF)

EDF was established in 1989 by Bangladesh Bank with current allocation of USD.300 million in size, to facilitate access to financing in foreign exchange for input procurement by manufacturer-exporter.

Authorized Dealer (AD) banks can borrow US Dollar funds from the EDF against their foreign currency loan to manufacturer-exporter. As of 31st December 2009, the bank allowed USD 3.45 million for input procurement under the EDF Scheme of Bangladesh Bank and in 2010.

7.2 International Trade Operations

Since its inception, Southeast Bank has been highly active in facilitating international trade related services to its customers. By adding innovative product solutions, the bank has continuously upgraded its services for its corporate clients to cope with the ever changing pace of Globalization.

The Bank offers various types of trade products to its customers such as Import and Export Letters of Credit, Foreign Guarantees, Standby Letters of Credit, Discounting etc. Despite global financial turmoil that seriously affected the import and export trade business world wide, the Bank has achieved a sound growth in both import and export sector in 2009. Although out of 56 branches of the Bank, only 21 branches are Authorized Dealers to handle foreign trade operations, almost all the branches are adequately equipped with professional manpower and infrastructural facilities to provide trade finance facilities to their corporate customers through the AD branches.

7.3 Import Trade

In 2009, the Bank experienced a robust growth in its import based business.

The total import of the Bank stood at Tk. 69,582.92 million (USD 1,004.51 million) which is around 20% higher from the import of 2008. Food Commodities such as Wheat, Sugar, and Crude Soyabean Oil, Capital Machineries, Raw Materials for export-oriented garment industries, Scrap Vessel, Raw Cotton and Flat Rolled Steel / Steel Billet etc. occupy the substantial portion of import items for the bank in 2009.

Import Figures of the bank for the last 6 years are as below:


Year

Import volume in eqvt.

US Dollars (in Million)

Import volume in eqvt.

Taka (In Million)

2004

306.51

20229.62

2005

421.44

29079.30

2006

501.79

35125.12

2007

557.50

38470.34

2008

840.86

58019.77

2009

1004.51

69582.92

7.4 Export Trade

Since 2004, Southeast Bank has been strongly committed to strengthen the export sector of this country by facilitating the exporters of Readymade Garments, Agro based Industries, Frozen Fish, Leather, Jute and Jute Goods sector. In addition to the above, the bank has been facilitating novel export based industries such as Ceramics Industries and ShipBuilding to earn substantial volume of foreign exchange for our country. Despite decline in overall export of our country due to the financial crisis in the developed economies, our Bank registered a sound increase in exports in 2009 from last year.

The total export of the Bank was Tk.46,724.47 million (equivalent to USD 674.53 million) which is 11% higher than that of 2008.

Year

Import volume in eqvt.

US Dollars (in Million)

Import volume in eqvt.

Taka (In Million)

2004

112.32

6,761.93

2005

202.41

13,511.10

2006

369.64

25,874.61

2007

423.10

28,771.36

2008

611.28

42,178.60

2009

674.53

46,724.47

7.5 Foreign Correspondent Banks

The Correspondent Banking team of Southeast Bank works relentlessly to build and expand strong correspondent network with top ranking banks of the world, so that the international import, export, guarantees and remittance business of the customers are handled in a most efficient and effective manner. Southeast Bank have successfully secured lines from International Finance Corporation (a World Bank subsidiary), FMO (of the Netherlands), and Asian Development Bank to facilitate our trade transactions.

As of 31st December, 2009, the number of foreign correspondents stood at 589 banks in 95 countries of the world.

8.1 Capital Market Scenario of Five years

Country’s capital market has experienced changes in its infrastructure and has developed with the advancement in information and communication technologies introduced in capital market.

In recent time, the practice of Corporate Governance by the listed companies has progressed faster than ever before. At the end of 2009, the DSE General Index was 4535.53 and it was 2795.34 at end of 2008. The DSE General was up 1740.19 points or 62.25% in the year 2009, compared to that of the previous year.

Total market capitalization at the end of 2009 was Tk.1,903.23 billion which was Tk.1,043.79 billion at the end of 2008. Eighteen companies offered parts of their Authorized Capital to the public through Initial Public Offerings (IPOs) in the year 2009. The total value of fresh capital injected in the market in the form of IPO in 2009 was Tk.19,047.00 million.

8.2 Investment Scenario of Five years

The investment portfolio of the Bank during the year 2009 was Tk.21,350.23 million against Tk.12,299.61 million in the previous year registering a growth of 74 percent.

The portfolio of investment included Government Treasury Bills, Prize Bonds, Shares of Public Limited Companies etc. The Bank has always given emphasis on investment of Funds in high yield areas.

8.3 Money Market Scenario of Five years

The Bank actively participated in the money market transaction in the year 2009.

Bangladesh Bank reduced the repo and reverse repo rate to 4.50% and 2.50% respectively in 2009 which were previously 8.50% and 6.50% respectively. At the same time, Bangladesh Bank adopted Expansionary Monetary Policy and as a result, the inter-bank call rate went fairly low and reached the historic low at 0.10%.

8.4 Asset Portfolio of Five years

Taka in Million

a)Cash and Cash Equivalent

7,332.41

b)Investments

21,350.23

c)Loans and Advances

77,497.57

d)Fixed Assets

4,338.34

e)Other Assets

2,158.43

TOTAL:  112,676.98

As on 31st December, 2009, the total assets of the Bank stood at Tk.112,676.98 million.

The break-up of the total assets are given below:

8.5 Contribution to the National Exchequer of Five years

Year

Amount (Taka in Million)

2009

1,475.33

2008

1,247.75

2007

1,185.64

2006

883.00

2005

543.27

The Bank’s contribution to the National Exchequer was Tk.1475.33 million during the year 2009.

8.6 Year-wise Operating Income of Five years

Year

Amount (Taka in Million)

2009

5,859.21

2008

4,039.43

2007

3,817.97

2006

2,721.48

2005

2,046.90

The Bank earned an operating income of Tk.5,859.21 million during the year 2009 from Net Interest Income, Income from Investment, Commission, Exchange and brokerage and other Operating Income.

The operating income of the Bank during the year 2008 was Tk.4,039.43 million. The operating income posted 45 percent growth in 2009.

8.7 Year-wise Lending of Five years

Year

Amount (Taka in Million)

Growth Rate

2009

77,497.57

29%

2008

60,281.26

25%

2007

48,164.60

17%

2006

41,147.28

26%

2005

32,551.09

48%

The total lending of the Bank stood at Tk.77,497.57 million as on 31st December , 2009 as against Tk.60,281.26 million in the previous year showing  an increase of 29 percent.

8.8 Growth of Operating Profit of Five years

Year

Amount (Taka in Million)

Growth Rate

2009

4,614.66

29%

2008

3,012.58

25%

2007

2,916.20

17%

2006

2,062.66

26%

2005

1,473.44

48%

The Operating Profit of the Bank stood at Tk.4,614.66 million in 2009 as against Tk.3,012.58million of the previous year.

8.9 Year-wise Return on Equity of Five years

Year

Percentage of ROE

2009

16.51%

2008

12.06%

2007

19.90%

2006

17.98%

2005

17.64%

During the year 2009, Return on Equity (ROE) of the Bank was 16.51 percent as against 12.06 percent of the previous year.

8.10 Year-wise Net Profit of Five years

Year

Amount (Taka in Million)

Growth Rate

2009

1,870.19

110.80%

2008

887.24

-27.41%

2007

1,222.97

34.41%

2006

909.88

143.15%

2005

374.20

Net profit of the Bank stood at Tk.1,870.19 million as on 31st December, 2009 as against Tk.887.24 million in the previous year showing  an increase of 110.80 percent.

9.1 Finding Problems of the organization

  • As Southeast Bank has no branches in many districts in the country, they can’t operate overall operations in the economy of the country.
  • Peoples have lack of knowledge about SEBL as they have limited of branches in some specific districts.
  • Less of the efficiency of Marketing sector of SEBL, the bank can hold the position that they can achieve. The peoples should be aware about the activities of SEBL.
  • Lack of sufficient employees keeps pressure on the existing employees on their works. That is why sometimes the employees makes mistake and get frustrated.
  • The operational charges of SEBL are high from others bank causes discouragement of the peoples to work with it.
  • Employees are recruitment criteria should be more effective as less efficient peoples may not be recruiting.
  • As clearing house get electronic, IT sector have not sufficient employee to hold this effectively.

9.2 Recommendations

  • Southeast Bank should open more branches to operate more effective operations in the country.
  • Marketing Sector should be improved and effective.
  • More effective people should be recruited to serve for SEBL, as they can serve better.
  • IT sector should expand as it can works with the Electronic Clearing house with Bangladesh Bank.
  • SEBL should concentrate to the Internship student as they can be effective for the Bank.

9.3 Conclusion

Southeast Bank shapes its tomorrow today.

The Bank has already earned a good operating pro­fit. Demands for our fi­nancial products remain strong. The profi­table expansion of our activities continues to be underpinned by our strategy of responsible lending, disciplined growth and careful management of credit quality. Comprehensive new Software, Bank Ultimus, has been put in place.

The new Software will be the tool to devise more innovative products for customers and improve the Management Information System (MIS). The Bank has been modernized and readied to penetrate the market with more value added products.

Southeast Bank’s priority for 2010 is to consolidate its existing position and attain higher growth and profitability without compromising the quality of its assets.

SEBL commit themselves in exercising total compliance with all regulatory requirements and remain as a compliant Bank in the years ahead. SEBL will continue to share the common vision to build up an institution that can stand the test of time and one day emerges as a world class bank.