Pubali Exchange and Pubali Money Payment Business: PBL has started the business of Pubali Exchange and Pubali Money Payment to facilitate the process of remittances. PBL in this regard has established 2 Exchange in London and Malaysia and will also establish another one in Italy very soon. Gradually Pubali Exchange will be established all over the world.
Products And Services Of PBL
Pubali Bank Limited offers various kinds of deposit products and loan schemes. The Bank also has highly qualified professional staff members who have the capability to manage and meet all the requirements of the bank. Every account is assigned to an account manager who personally takes care of it and is available for discussion and inquiries, whether one writes, telephones or calls. The products and services are given below:
Foreign Currency Account
|Loans & Lease Services:||Remittance Services:|
Last three Years At A Glance Of PBL
|16||Number of Employees||5321||5375||5534|
|17||Number of Shareholder||24,153||30,899||86,200|
|18||Number of Branches||371||386||399|
|19||Earning Per Share(absolute EPS for tk. 10 face value)||5.15||5.47||6.51|
Role Of Foreign Exchange In International Trade
Since the early days of civilization, nations have engaged in trading. At the same time each nation has developed its own currency. Internationalism of trade and nationalization of currencies are two divergent phenomena, as mentioned by the French economist. As the world, by the grace of modern technology, is getting smaller day by day, the need for foreign exchange has become a part of everyday life. Globalization of the world economy for goods and services makes foreign exchange necessary for almost every citizen across the country.
Foreign exchange has a price in relation to local currency in the same way as rice, jute or any other tradable goods has a price in terms of taka and the price will vary. Foreign currencies from our point of view can very well be equated to commodities.
Local Rules and Regulation
Our foreign exchange transactions are being controlled by the following local regulations:
Foreign Exchange Regulations Act: Foreign Exchange Regulations
(FER) Act 1947 enacted on 11th March 1947 in the British India,
Provides the local basis for regulating the foreign exchange . This act
was adapted in Pakistan and lastly in Bangladesh.
Guideline for Foreign Exchange Transaction: This publication issued
By Bangladesh Bank in the year 1996 in two volumes. This is compilation
Of the instructions to be followed by the authorized Dea/Crs in transaction
Relating to foreign exchange .
F.E. Circular: Bangladesh Bank issues F.E circular from time to time control the export business and remittance to control the foreign exchange. It has one kind of supplementary and complementary action to the guideline for foreign exchange transaction.
Import-Export policy: Ministry of commerce issues Export policy and Import policy giving basis formalities and instructions for Import and Export business.
Public Notice: Sometimes Chief Controller of Import and Export issue public notice for any kind of change in foreign exchange transactions.
Instructions from Different Ministry: Different ministry of government sometimes instruct the authorized dealer directly or through Bangladesh Bank to follow something required for the government.
International Regulation For Foreign Exchange
There are some international organizations influencing the foreign exchange transactions. Few of them are discussed below:
International Chamber of Commerce: ICC is a worldwide non-governmental organization of thousands of companies. It was founded in 1919. Its headquarters is in Paris. For managing and controlling the international trade ICC issues some publications which are being followed by the all member countries. It has also a International Court of Arbitration to solve the international business dispute. The major publications of ICC are:
World Trade Organization (WTO): WTO is another international trade organization established in 1995. This organization has vital role in international trade through its 124 member countries.
The rate of exchange is the price of one currency, in terms of another currency or in the other words, the number of units of one currency which exchange for a given number of units of another currency.
Theories of Determination of Exchange Rate
There are mainly 4 theories explaining the determination of exchange rate. Such as:
Analysis and Findings
Import Performance Of PBL
During the year the bank handled import business worth tk. 85683.53million. During the previous year the amount was tk. 60493.85million. The amount of import business handled by the bank increased by tk. 25189.68million during the year which was 41.64% higher than that of the previous year
Key Performance of Import
|BDT in Million||37316.50||48345.41||58009.10||60493.85||85683.53|
Table 4.1: Key Performance of Import
Registration of L/C
A credit officer scrutinizes this application and accordingly prepares a proposal (CLP) and forwards it to the head office credit committee (HOCC). The committee, if satisfied, sanctions the limit and returns back to the branch. Thus the importer is entitled for the limit.
The letter of credit (L/C) registration function shall allow the user to register a new L/C upon receipt of an application for issuance / opening of L/C.
It shall provide the followings:
Precaution To Open A L/C:
Before Opening a L/C, the issuing bank must check the following:
Opening Process of A L/C
In foreign exchange banking Letter of credit (L/C) opening is an important part. L/C opening is a set of procedure which every importer needs to follow to import their products. At first importer need to contact with Exporter and with their understanding exporter prepare pro forma invoice and sent it to the importer.
After received the pro forma invoice importer present it to their bank that is known as issuing bank that prepare L/C on behalf of importer. After preparing L/C proposal need to send Head office of issuing bank for approval. After approval, issuing bank open L/C on behalf of importer, signed it by proper authority of bank officer, and send it their authorized export country bank for authentication. The process is done through SWIFT/ Telex. The bank that provides authentication then it called advising bank. After given the authentication seal- advising bank send it to the exporter bank as per requirement of invoice.
Charges of L/C opening : To open local L/C:
To open foreign L/C:
Documentation check list for L/C: To open L/C the following documents are required-
Preparation Of Export Documents
For obtaining export registration certificate (ERC) from the CCI & E, the following documents are required:
BACK to Back L/C
Convertibility of Taka in current account transactions symbolized a turning point in the country’s exchange management and exchange rate system. Now the operation of foreign currency accounts has been more liberalized. Funds from these accounts are freely remittable to any country according to the needs of A/c holders.
Authorized Dealer remittance means purchase and sale of freely convertible Foreign Currencies as permissible by the rules and regulations of Exchange Control Authority of Bangladesh Bank.
Remittance takes place in two types:
i) Inward remittance
ii) Outward remittance
FDBC (Foreign Documents Bills For Collection)
The term “Inward Remittance” includes not only remittances by TT, MT, Draft etc. but also purchases of bills and traveler’s cheques.
Generally, Inward remittance comprises:
a) Remittance received by Drafts
b) Remittance received by mail transfer
c) Remittance received by telegraphic transfer
d) Purchase of bills & travelers cheques
Remittance equivalent to USD 2,000 and above should be reported on “Form – C” therefore, after receipt of Inward remittance of USD 2,000 or above or equivalent, the A/D Branches, before
disbursement of the same shall obtain declaration from the beneficiary in a prescribed form “Form C”.
But declaration in “Form-C” will not be required by the beneficiary against any remittance sent by Bangladesh national working abroad which meant for family maintenance. “Form-C” is required when remittance comes from abroad in the name of Firms, Companies, and NGO’s etc.
Remittance received against export should be certified and reported on EXP Forms, In case of remittance received in advance for exports, the A/D should obtain a signed declaration from the beneficiary on the back of the Advance Receipt Voucher certifying the purpose of remittance.
It may be mentioned here that Inward Remittance received through DD/MT/TT/TC should be reported on “Form-C”. Remittance received against exports should be certified and reported on EXP Form.
There are three types of such accounts:
a) FC accounts
b) Resident Foreign Currency Deposit Account
c) Non-resident Foreign Currency Deposit Account
The Bangladesh Nations working abroad may maintain F.C. Account & brought Foreign Currency at the time of their return to Bangladesh. These accounts are termed as Resident Foreign Currency Deposits A/c. One person can bring into Bangladesh for USD 3,000/- or above has been duly declared by them to the custom on Form FMJ at the time of arrival can be credited to F.C A/c or be encased in Bangladesh Taka within 30 days of arrival ( F.E. circular No.05 dated 04.02
Remittance from our country to foreign countries is called outward foreign remittance. The Authorized Dealer on behalf of Bangladesh Bank approves outward remittance. Only a few remittances of special nature require Bangladesh Bank’s prior approval. Any person who wishes to purchase foreign exchange must lodge an application for the purpose on a prescribed Form with the authorized Dealer Branch. There are two types of application forms for outward remittances – “IMP Form” and “T/M Form”.
a) The IMP form is designed to cover remittances for payment of import obligation.
b) T/M form is designed to cover all other types of remittances other than Imports.
Outward remittance may be made for following purposes:
b) Medical Treatment
c) Educational purpose
d) Attending seminar etc.
e) Balance amount of F,C. A/c
f) Profit of foreign companies
g) Technical assistance
h) New exporters up to USD 6,000/- for business promotion
I) F.C. remittance can be made for fare, exhibition from Export Retention Quota.
Outward remittance in favor of beneficiaries outside Bangladesh may be made in any of the following manners:
a) By issuing Demand Draft
b) By issuing Mail Transfer
c) By issuing Telegraphic Transfer
Excluding payment of import obligation some commercial remittances may take place in the form or DD/MT/TT for under noted cases:
I) Remittance or Dividend to non-resident shareholders
ii) Remittance of profit of foreign firms and companies.
iii) Remittance for import of Books and Journals
iv) Remittance of pre-shipment inspection fees etc.
It can be conclude that, since 1983, the Government of Peoples Republic of Bangladesh started taking ownership reform measures in financial sector. Two out of six NCBs were denationalized and a number of private commercial Banks (PCBs) were allowed to operate by the government. It results competition and improves the level of customer services operation efficiency of the Banking sector. As a result of this competition peoples are favoring a lot, Banking services are improved, employments are generated and public money earns more and more securities and benefits which ultimately developing economy as a whole.
It is also to be stated that this competition is not confined within the country. Due to high fuel cost and relatively lowers technological use made us competitive in the world economy. But we are in a state of consistent in economic sector maintaining on an average five (05%) percent of GDP growth. This constant growth results in high-tech introduction and positive competitive environment in financial sector especially within financial intermediaries (Banks). Introduction of high-tech services can ensure growth towards first generation Bank like Pubali Bank Ltd.
Bank always contributes towards the economic development of a country. PBL, compared with other banks are contributing more by investing most of their funds in fruitful projects leading to increase in production. It is obvious that right thinking of this bank including establishing a successful network over the country and increasing resources, will be able to play a considerable role in the portfolio of development financing in the developing country like ours.
PBL continues to play its’ leading role in socio-economic development of the country as a companion of Independent Bangladesh. Besides its’ traditional function such as deposit mobilization, deployment of fund in trade, commerce, industry, agriculture, import & export business, outward and inward remittance, as an agent of Bangladesh Bank, PBL has emerged as the pioneer of playing key role in the country.
Pubali bank limited, considering the environment, though far behind from other banks, the bank is in a state of steady growth. The top management of PBL is always trying their best to improve their service quality to the customers and enhance the reputation in the Banking business in our country as well as abroad. PBL recruits a good number of fresh talents every year and invests handsome money for necessary training purposes to ensure the fulfillment of better service. Now, the slogan of PBL is “Think Bank, Lead Bank”.
Above all, bank is a risky industry with many diversified and complex inputs and outputs. Asset liability management has vast and difficult areas to manage. A bank only can minimize its risks and maximize profit by managing its balance efficiently. The manual is a guiding assistance for the purpose and not the whole thing of asset liability management. The issues contained in this manual may enrich one’s skill for better performance in the field.
Suggestion And Recommendation
In order to get competitive advantage & to deliver quality service, top management should try to modify the services. For the improvement of the service the following measures should be taken:
Some other important factor that should be focused on the development process: