Loans and Credit Facilities of Janata Bank Limited

Export Finance

Export through Janata Bank Ltd. for the year 2008 and 2009 is Tk.85418.00 million and Tk. 87500.00 million respectively. In spite of Global Financial Crisis the growth chart in export through Janata Bank Ltd. remains upwards due to our timely steps regarding credit facilities and services packages. We have already re-fixed our schedule of exchange at a reduced rate the loan pricing is more competitive. With the credit lines our experts have introduce the following new products:

  Cash Credit:  Working capital facility to dyeing unit and packaging unit.

  Mid term Loan: For procurement of machinery, space parts, boiler, generator, vehicles etc. to export oriented industrial unit.

  Packing Credit:  Working capital facility to pay wages salary utility bills etc.

  LTR, FC: Short term credit for procurement of capital machinery from abroad.

  Term Loan: For (Export oriented) Ship Building.

  Export Project BMRE: Loans and Credit Facilities for factory building construction. Expansion, development and Maintenance, construction of factory godown, purchase of machineries from local and foreign markets, covered van, generator and establish ETP.

 Details Commodity Wise Export

Here given details commodity wise export figures of Janata Bank Limited from 2006 to 2009. It has shown here commodity wise and monthly wise export figures in details.

Month

Raw Jute

Jute Goods

Tea

Hide & Skin

RMG

F.FiSH

Vegetables

Others

January

3.04

38.56

1.33

58.76

244.75

47.91

13.7

85.31

February

2.68

35.07

0.56

37.7

260.93

41.94

12.54

61.67

March

10.16

23.2

0.9

67.21

295.23

34.05

7.17

67.67

April

4.95

33.55

0

64.01

337.37

46.25

8.54

121.69

May

1.8

89.94

0

75.84

269.97

75.46

19.37

79

June

6.4

29.18

0

82.22

302.17

65.55

10.48

151.68

July

2.71

37.11

0

76.66

329.88

77.37

13.58

83.59

August

2.72

33.18

0

54.31

322.15

65.13

17.77

165.86

September

3.52

32.13

0

49.65

265.47

77.13

9.76

166.92

October

15.94

30.52

0

53.45

260.08

22.32

6.81

111.28

November

10.13

53.69

0

54.41

302.6

46.59

7.12

113.77

December

4.79

108.27

0

84.44

359.22

74.77

9.51

145.89

Total

68.84

544.4

2.79

758.66

3549.82

674.47

136.35

1354.33

Grand Total

7089.66

 Source: Photo Copy from Head Office

In 2006 total export of Janata Bank was Tk. 7089.66 crore. Ready Made Garments was Tk. 3549.82 crore and it was the highest position. Hide & skin and frozen fish took the second and third position consequently. It is also clearly observed that in the month of August and September export amount was highest through the year.

Month

Raw Jute

Jute Goods

Tea

Hide & Skin

RMG

F.FiSH

Vegetables

Others

January

3.11

32.66

0

34.63

280.16

53.71

9.48

129.76

February

2.06

43.5

0

60.85

285.08

21.21

9.32

106.83

March

6.75

44.96

0

86.3

270.15

29.4

6.95

124.47

April

9.69

46.76

0

74.4

243.85

59.85

8.44

122.07

May

5.92

35.41

0

75.02

291.78

69.91

11.06

195.85

June

5.32

30.76

0

73.79

293.72

83.87

14.06

113.35

July

6.11

40.35

0.33

63.69

338.71

72.26

14.69

101.07

August

6.92

38.62

0

55.82

338.56

91.98

12.02

100.1

September

9.06

44.41

0

59.97

270.65

79.64

14.01

95.2

October

5.1

42.44

0.18

61.68

247.73

63.33

8.79

65.4

November

7.69

41.55

0.68

56.04

269.27

88.15

9.14

92.92

December

8.18

54.13

0.75

78.51

411.27

29.97

9.09

173.17

Total

75.91

495.55

1.94

780.7

3540.93

743.28

127.05

1420.19

Grand Total

7185.55

 Source: Photo Copy from Head Office

In 2007 total export of Janata Bank was Tk. 7185.55 crore. Ready Made Garments was Tk. 3540.93 crore and it was the highest position. Hide & skin and frozen fish took the second and third position consequently. First half of the year 2007 export amount was comparatively better position than the second half of the year.  It is also clearly observed that total export amount of 2007 is little bit higher than 2006.

Month

Raw Jute

Jute Goods

Tea

Hide & Skin

RMG

F.FiSH

Vegetables

Others

January

8.18

35.74

0.56

39.81

323.65

65.04

11.36

80.13

February

1.55

57.35

0.83

52.56

332.52

45.16

11.34

90.25

March

4.88

90.44

0.47

74.6

348.78

53.54

10.22

99.13

April

4.76

74.57

0.46

89.53

278.37

66.17

10.4

157.21

May

3.66

48.59

0.3

69.31

284.77

44.88

13.17

200.85

June

7.27

55.09

0

65.47

384.56

102.27

15.62

152.75

July

9.73

45.29

0.34

58.16

376.99

111.91

18.97

127.65

August

4.79

46.03

0.37

65.4

358.42

65.73

16.15

200.13

September

7.11

43.51

0

94.6

344.92

102.1

28.56

200.3

October

5.73

45.41

0

106.46

331.72

51.07

11.02

89.39

November

4.7

55.21

0

72.86

368.23

71.88

8.77

159.13

December

12.32

47.31

1.87

48.77

456.99

42.48

7.32

247.84

Total

74.68

644.54

5.2

837.53

4189.92

822.23

162.9

1804.76

Grand Total

8541.76

 Source: Photo Copy from Head Office

In 2008 total export of Janata Bank was Tk. 8541.76 crore. Ready Made Garments was Tk. 4189.92 crore and it was the highest position. Hide & skin Tk. 837.53 crore and frozen fish Tk. 822.23 crore took the second and third position consequently. Throughout the whole year 2008 export amount was comparatively better than the last two years.  It is also metion here that total export amount was significantly higher than 20060and 2007.

In FY 2009 target export was Tk. 66480.00 million, but earned Tk. 88653.10 million against the target amount. This was 133% higher than the target. It may mentioned here that up to October 2009 earned was Tk. 7231.80 million, that means target of export had attained before two months end of the year.

Month

Raw Jute

Jute Goods

Tea

Hide & Skin

RMG

F.FiSH

Vegetables

Others

January

1.98

37.32

0.39

64.21

330.34

63.6

12.08

202

February

3.5

38.15

0

65.37

385.78

40.83

9.82

146.68

March

3.03

38.56

1.05

74.3

447.59

35.75

9.74

114.08

April

4.78

44.91

0

37.67

426.23

52.16

10.33

135.54

May

4.32

39.01

0

103.5

325.72

80.79

14.15

178.66

June

10.03

26.69

0.12

89.93

432.8

92.21

14.52

99.29

July

2.96

41.8

0.07

118.53

396.29

77.5

16.67

146.8

August

6.65

44.05

0

99.85

397.05

97.43

17.96

77.58

September

20.06

42.48

0.39

91.42

332.96

70.44

13.61

101.43

October

27.52

52.78

0

79.55

265.8

69.34

13.37

158.33

November

11.55

72.35

0.07

127.69

353.31

76.36

12.88

153.26

December

5.4

43.31

0

69.2

353.95

61.12

11.47

283.21

Total

101.78

521.41

2.09

1021.22

4447.82

817.53

156.6

1796.86

Grand Total

8865.31

 Source: Photo Copy from Head Office

In spite of world economic crisis and political instability in the country Janata Bank Limited has kept its upward export trend up to last year. Because Its expertise and experienced management team offered different promotional offer and financially assisted to the exporters to boost up the export trend. They main offered and assisted-

  Concessional rate of interest.

  Export incentive programs.

  Export Processing Zone facility.

  Scope of establishment of export oriented industry by 100% foreign investment and by joint venture.

  Full fledged infrastructural and logistic support for export i.e. project finance, working capital, pre-shipment & post-shipment export finance, guarantee, bonding facility, etc.

 Consulting facility by an expert group of officials.

Export Target & World Economic Crisis

From 2006 to 2009 export of Janata Bank is in increasing pattern. Even during world economic crisis period Janata Bank’s management shows their best performance. That is why export position remains in upward condition.

 In spite world economic crisis export growth has increased 4%. Which is highest among four government owned banks.

      Tk.(Million)

Year

Target

Achievement

Percentage of Target

2007

77983.8

71855.5

92.18%

2008

86226.6

85417.8

99.06%

2009

66480

88653.1

133.00%

 Source: Annual Meeting Report 2010

National and Janata Bank Limited’s Export Performance

(Million US$)

 

National Export

Contribution to National Export of Janata Bank Limited

Financial Year

Target

Achievement

Achievement

Percentage

2003-2004

7227.70

7603.00

632.90

8.21%

2004-2005

8565.78

8655.00

692.80

8.00%

2005-2006

10159.20

10526.16

958.02

9.10%

2006-2007

12500.00

12187.5

1057.68

8.68%

2007-2008

14500

14411.1

1034.56

7.12%

2008-2009

16298.43

15565.1

1300

8.35%

 Source: Web sites  Annual Meeting Report 2010

For global economic recession and political instability inside the country contribution to national export of Janata Bank limited was lowest in the fiscal year 2007-2008 among last six fiscal years. And in fiscal year 2008-2009 it turned up warding.

Because to increase export business providing the exporter more foreign currency, to strengthen their production capacity, to facilitate the in every maximum scope, the bank has took four incentives. These have been proved to be fruitful adding Tk.2.00cr (approx.) more to the bank’s annual income through only export business.

These new four incentives are as follows in brief:

  In addition with the existing working capital it provides exporters emergence need to execute their foreign order.

  For importing bulk quantity of dies, chemical it is a great support for the exporter.

  Loan for importing generator, small machines, vehicles for emergency need.

  For importing capital machinery.

Comparison of Export of 2009 with Public Banks

Tk. (Mill.)

Janata Bank

88653.1

Sonali Bank

64243.3

Agrani Bank

44606.8

Rupali Bank

7458.1

 Source: Photo Copy from Head Office

Total export Janata Bank Limited in 2009 was Tk.88653.1 million. Sonali Bank’s export was Tk.64243.3 million. Agrani Bank’s and Rupali Bank’s export was Tk.44606.8 million and Tk.7458.1 million respectively. From above table and graph we can say that Janata Bank Limited is the top position among four government owned banks with a large difference. Its nearest competitor is Sonali Bank Limited.

Import Finance

 Traditionally Janata Bank Ltd. is pioneer in handling major portion of country’s import business. The total volume of import as on 30-11-2009 is 107168 million. Major import items are industrial raw materials, chemicals, capital machineries, scraped vessels and petroleum etc.

Commodity wise Import of Janata Bank Limited

Tk. (Crore)

Items/Year

2009

2008

2007

2006

Commodities

Food Item

904

1075.91

396.25

12.14

Edible Oil

339.42

155.97

18.9

14.66

Fertilizer

2300.96

2779.16

1140.44

599.37

Petroleum

3483.1

4448.87

3659.86

8774.58

Machineries

1190.41

1108.28

853.11

1089.54

Chemicals

559.45

988.37

608.84

490.82

Raw Materials of Industry

2600.52

1306.44

1289.95

1408.16

Ship Breaking

23.31

177.95

101.4

144.25

Cement Clinkers

257

279.55

230.9

209.79

Others

194.33

620.8

106.89

137.59

Total

11852.5

12941.3

8406.54

12880.9

 Through quite a good number of Authorized Dealer Branches and 1198 nos. foreign correspondents world wide Janata Bank Limited has been extending full range import and relevant finance facilities. Setting Industrial vision to facilitate optimally, bank’s involvement has been showing sharp rising trend.

Year

Taka in Million

2000

48005

2001

54666

2002

58889

2003

60477

2004

74920

2005

72912

2006

128809

2007

84065

2008

129413

2009

118525

 Source: Web Sites of Janata Bank Limited

From 2000 to 2006 import of Janata Bank Limited is gradually increasing. But in 2007 the country was under caretaker government. Export, import, foreign remittance, employment in abroad etc. were moving forward in slow rate. For this reason import in 2007 sharply down compare with 2006. Again in 2008 import of Janata Bank Limited reached higher than 2007. And in 2009 import is dropped little bit.

Import target and achieve in last 3 years

Year

Target

Achieved

Percentage of Achieved

2007

8000

840.54

105%

2008

9247.19

12941.3

140%

2009

10172

11852.5

116%

  Contribution of Janata Bank in National Import

Year

National Import Tk.(crore)

Growth

Import of  Janata Bank Tk.(crore)

Growth

2006

111307

0

12880.9

0

2007

127221

14.30%

8406.5

-35.20%

2008

163505

27.78%

12941.3

54.17%

2009

18440

-9.23%

11852.5

-8.41%

 Income from Import

Particulars

2007

2008

L/C Commissions and Other charges

77.87

86.53

Interest (PAD,LIM,LTR and Others)

387.63

278

Total

465.5

364.53

  Contribution to National Import of JB in last decade

Fiscal Year

National Tk. (Crore)

Janata bank Tk. (Crore)

Percentage

1995-1996

28303.78

4009.87

14.16726

1996-1997

30539.62

3799.45

12.44105

1997-1998

34183.13

3731.94

10.91749

1998-1999

38480.32

4646.58

12.07521

1999-2000

42130.6

4754.46

11.28505

2000-2001

50371

5233.07

10.38905

2001-2002

49049.1

5345.2

10.89765

2002-2003

55917.63

6117.06

10.93941

2003-2004

64256.56

6952.62

10.82009

2004-2005

80894.78

8397.96

10.38134

2005-2006

99130.07

9230.42

9.311423

2006-2007

118389.8

10757.9

9.086847

2007-2008

166974.3

9466.11

5.669201

 Increase of import indicates the country is less wealthy and decrease of import indicates that the country has sufficient resources and is able to fulfill its local demand. So as a publicly owned bank Janata bank Limited is less service providing attitude to the importers. It provides little facilities to its importers. As a result import contribution percentage to national is decreasing gradually from fiscal year 1995-1996 to fiscal year 2007-2008.

Foreign Remittance

Inward foreign remittance through Janata Bank Ltd. up to November 2009 is Tk. 51508.55 million. Foreign remittance from NBRs reached record high of Tk. 45924 million in 2008 against Tk.36788 million in 2007 and continue to play an important supporting role in strengthening the economy of the county Janata Bank ltd. by reducing lead-time, has ensured quick delivery of foreign remittance, an NBR branch has been opened to serve exclusively Non-resident Bangladeshis through Speedy Money Remittance System with instant to the beneficiaries.   Anybody willing to remit foreign currency from any corner of the world can use wide network of the bank. The remittance reaches to the beneficiary within 3 days without charging any commission. Our worldwide network includes 4 branches in UAE, 2 exchange houses in Italy and correspondent relationship with all the major Banks and all important trade centers of the world.

Recently Janata Bank Ltd. has launched its Speedy Foreign Remittance Payment System which enables beneficiaries to receive their money within shortest possible time. The beneficiary also gets information of remittance through automated SMS. It’s a secured, easy, cost effective and speedy way of remittance for the remitter.

Janata bank Ltd. has signed an agreement with Western Union Network to facilitate wide range of remittance of the globe. Both the organizations make it possible to receive the money from about 300,000 locations of 200 countries instantly with prevailing mutual mechanism and workforce. The achievement of Janata Bank Ltd. in attracting foreign remittance as compared to country’s performance is given bellow:

Country wise remittance of Janata Bank Limited

To facilitate sending money in Bangladeshi Taka directly, Janata Bank Limited has Taka Drawing Arrangement with many banks/exchange companies in different countries. The expatriate Bangladeshis may send their money in BDT (Bangladeshi Taka) through the branches/subsidiaries of Janata Bank Limited and foreign banks/exchange companies. Remittance services are available at all branches and foreign remittances may be sent to any branch by the remitters favoring their beneficiaries. Remittances are credited to the account of beneficiaries instantly or within shortest possible time.

Tk.(Mill)

Country/Exchange Co./ Year

2004

2005

2006

2007

2008

2009

Janata Echange Co., Italy

1182.5

2077.1

3102.1

3513

2289.8

1446.8

Janata Bank, UAE Branches

5196

5638

5666.7

9188.3

12548.8

16207.7

Other Exchange Co.

2143.5

2279.5

2901.7

4714

6878.2

8738.1

Kuwait

3468.6

4089.3

5652.6

7615.9

7780.1

6764.3

Saudi Arabia

4057.9

3762.7

3598.3

3025.2

4536

7718.2

Oman

1129.8

1095.6

1106.2

1171

1341.6

1038.7

Bahrain

785.2

817.4

853.2

834.5

916.7

716.1

Greece

0

0

537.9

697.9

591.5

524.5

UK

0

0

0

0

2213.3

6174.9

Qatar

196.1

190.8

149.2

173.6

200.6

118.9

United States

26.9

29.2

132.8

153.6

222.3

285.7

Malaysia

1139.3

623.9

264.2

208.7

113.2

23.9

Singapore

0.2

0.4

5.3

0.7

20.2

98.1

Korea

0

23.2

2.5

0

0

0

Canada

166.7

0

6.6

7.2

0

0

Australia

14.4

0

0

0

0

0

Other sources (SWIFT/Telex)

4556.4

5945.7

5288

5484.4

6272.1

6334.2

Grand Total

24063.5

26572.8

29267.3

36788

45924.4

56190.1

 Inward remittance from Bangladeshi nationals working abroad continued to play an important role in strengthening the current account. Receipts on this sector increased gradually in every year from 2006 to 2009. The underlying reason was that Bangladesh Bank has simplified the approval policy of drawing arrangements between foreign exchange houses and domestic bank. Janata Bank’s management has taken this opportunity.

For quick payment of TTs issued by 4(Four) UAE branches of Janata Bank Limited ( Abu Dhabi, Al-Ain, Dubai & Sharjah branch) Foreign Exchange Corporate Branch, Dhaka( FECB, Dhaka), Laldighi East Corporate Branch, Chittagong(LDE, Ctg), Foreign Exchange Corporate Branch, Sylhet( FECB, Sylhet), Khulna Corporate Branch, Khulna, Barisal Corporate Branch, Barisal & Rajshahi Corporate Branch, Rajshahi are nominated. To facilities to its remitters Janata bank Limited has started-

1. FECB, Dhaka will cover whole Dhaka Division,

2. LDE, Ctg will cover whole Chittagong Division, except branches under greater Comilla and Noakhali Area.

3. FECB, Sylhet will cover whole Sylhet Division,
4. Khulna Corporate will cover whole Khulna Division,

5. Barisal Corporate will cover whole Barisal Division,

6. Rajshahi Corporate will cover whole Rajshahi Division,

7. Comilla Corp. will cover all branches under greater Comilla district.

8. Noakhali Corp. will cover all branches under greater Noakhali district.

Commission for issuance of Taka Drafts from our UAE branches has been reduced and refixed from AED 10.00 to AED 4.00 and commission  for issuance of TTs drawn on Bangladesh and payable at any bank branches are re-fixed at AED 12.00 from AED 30.00.

Commission for issuances of Taka drafts at UAE branches has been reduced irrespective of amount. 1% interest above the normal savings deposit rate is offered to SB accounts receiving foreign remittance.

 Wage Earners’ Remittances of Nation

Inward remittances from Bangladeshi nationals working abroad continued to play an important role in strengthening the current account of Bangladesh Bank. Receipts on this sector increased by 22.4 percent to USD 9689.3 million in FY 09 from USD 7914.8 million in FY 08. The underlying reason was that Bangladesh Bank has simplified the approval policy of drawing arrangements between foreign exchange houses and domestic banks. As a result 40 banks have been allowed for establishing 820 drawing arrangements with 208 exchange houses all over the world for collecting remittances. Due to these measures, remittances have recorded a substantial increase by 22.4 percent to USD 9689.3 million during the year 2009. Remittances as percentage of GDP increased by 089 percentage points to 10.84 in FY 09 from 9.95 in FY 2008. The shares of major source countries in the remittance receipts of FY 2008 and FY 2009 are given bellow.

Country

Percentage

Kingdom of Saudiarabia

29.40%

UAE

14.30%

UK

11.30%

Kuwait

10.90%

USA

17.50%

Other countries

16.60%

Total

100.00%

Country

Percentage

Kingdom of Saudiarabia

29.50%

UAE

18.10%

UK

8.20%

Kuwait

10.00%

USA

16.30%

Other countries

17.90%

Total

100.00%

 This is the whole scenery of inward foreign remittance of 2008 and 2009 of Bangladesh. In the sector of foreign remittance earning 2008 Kingdom of Saudiarabia in highest position that is 29.40%, USA second position- 17.50% and United Arab Emirates is third position 14.30%. And in 2009 Kingdom of Saudiarabia again top position, in second position United Arab Emirates and in third position USA. Their inward remittances are 29.50%, 18.10% and 16.30% respectively.

Foreign Exchange and Foreign Trade of JB

Year

2006

2007

2008

2009

Import

128809

84065

129413

118525

Export

70897

71855

85418

88653

Remittance

29267

36788

45924

56190

 Export and foreign remittance are in good position. They are in increasing trend from 2006 to 2009. And due to global economic crisis and for various trade barriers and quotas import does not grow much higher compare with export and foreign remittance. In 2007 export and import are comparatively low with other years due to political instability inside the country. But inward remittance is continuously upward trend up to 2009.

Problem of Foreign Exchange in Bangladesh

As a developing country, here there is a great opportunity to expand a business easily. Human resources cost are also cheap. On the other hand people have strong faith to the banking sector. But this sector is not free from problems. Some challenges of the banking sector are:

  1. Global economic crisis due to the financial meltdown in USA and Europe.
  2. Withdrawal of restriction on China for RMG export to Europe and USA in 2009.
  3. Export volume has dropped due to lack of global demand.
  4. Lack of diversification, especially for export sector.
  5.  Very high dependency on Textile and RMG Sectors to export.
  6. In case of import prices of commodities and raw materials in international market.
  7. Slow recycling of investment of commodity in commercial sectors.
  8. Low level of project Finance in 2007, 2008 & 2009 due to the national political instability.

It is clear that the Janata Bank Limited Foreign Exchange department has ensured both quality and services which helps to improve the overall status of the Bank. For this reason Janata bank Limited has able to achieve second position in country and top position among public banks in export sector in 2009. However the branch may have scope to improve in a few areas. Such as-

01. The number of exporter and importer who operate through this bank is not enough to achieve the goal. So JBL should offer more facilities to attract their clients.

02. In addition with the present services they should include more services. It is badly needed to provide more quality services to their clients in order to compete in the market.

03. Foreign exchange department should be fully computerized that the exchange process would be convenient for both the bankers and the clients.

04. Bank should offer more facilities to the customers such as debit card, credit card, ATM machine etc. to survive in the competition.

05. One of the business strategies is promotion. Successful business depends how they can promote their products or services to the customers. In this connection to improve the business status the JBL should introduce more promotional programs.

Lastly it can say that there are a lot of opportunities for increasing foreign exchange in Bangladesh if stay political stability. The Human Resources are cheapest here which play an important role in any business. Bangladesh government should take proper steps to maintain congenial atmosphere for sustainable foreign exchange business in the country.

Janata Bank Limited