1.1 Origin of the report- The internship program require for the students who are completed BBA Program from StamfordUniversity. It is a 03 (Three) credit hours program with duration of 3 months. Students who have completed all the required courses in BBA Program are eligible for this. As an eligible candidate for internship program I have attached with National Bank Limited, Motijheel Branch for the period 02.02.09 to 08.05.09. During this period I have done research on General Banking and Accounting Department of National Bank Ltd., Motijheel Branch and this report is prepared on my work in this organization.

1.2 Objective and scope of the report

General objective

• To gain practical experience and view the application of theoretical knowledge in the real life.

Specific Objectives:

The specific objectives of the study are as follows:

• To get a clear idea about Banks and how it runs and what function it does.
• To gather theoretical knowledge of the general banking function.
• To know about new products and services of banking sector.
• To prove my theoretical knowledge in real practical field.
• To search expectations of the customers regarding the service level of the bank.
• To suggest my findings for continuous improvement of the Bank.

This report has been prepared through extensive discussion with bank employees and with the customers. While preparing this report, I had a great opportunity to have an in depth knowledge of all the banking activities practiced by the National Bank Limited.

1.3 Research methodology

The report was fully exploratory in nature. Data have been collected from both primary and secondary sources.

Primary sources of data

• Conversation with the bank officers and staffs.
• Informal conversation with the clients
• Different manuals of National Bank Limited.
• Different circulars of National Bank Limited.
• Personal Observation.
• Performance of practical activities

Secondary sources of data

• Annual report of National Bank Limited
• Different papers of National Bank
• Unpublished data
• Different text books
• Various files, balance sheet and various documents.

Data Processing

Collected information was processed by the use of computer system, research techniques etc. and this detail analysis work is embodied in the report.

1.4 Limitations of the Study

The present study was not out of limitations. But as an internship student it was a great opportunity for me to know the banking activities of Bangladesh, especially National Bank Limited. Some of the constraints are as follows:

• The main constraint of the study is limited access to information, which has hampered the scope of analysis required for the study.

• Due to the limitation of report size many of the aspects could not be discussed in the present report.

• Every organization has their own secrecy that is not revealed to others. While collecting data it was not possible to collect such information that hampers the organizational confidentiality.

• Since bank’s personnel were very busy on customer service time so it was quite possible to provide sufficient time.

• Another problem is that creates a lot of confusions regarding verification of data. Most of the cases same person performs various job so it was some times difficult to check the job pattern.

• The clients were too busy; some are less known about banking sector to provide much information at time of interview.

AN OVERVIEW OF NATIONAL BANK LIMITED

2.1 Traditional Heritage

National Bank limited is one of the front ranking first generation private sectors Bank in Bangladesh. The Bank started its commercial operation on 23^rd March 1983 with an authorized capital of taka10.00crore and a paid up capital of taka 4.40crore. In the meantime authorized capital of the Bank has gone up at Taka 245.00crore, paid up capital at Taka 80.55crore and reserve capital at Taka. 80.55crore.

At present, NBL has been carrying on business through its 91 branches spread all over the country. Besides, the bank has drawing arrangement with 400 correspondents in 75 countries of the world as well as with 32 overseas Exchanges Companies. NBL was the first domestic bank to establish agency arrangement with the world famous Western Union for facilitating quick and safe remittance of valuable foreign exchanges earned by the expatriate Bangladeshi nationals. The Bank has in its use the latest information technology services of SWIFT and REUTERS. NBL was also the first among domestic banks to introduce domestic and international Master Card. Subsequently, NBL also introduced Visa Card. In 2006, Power Card has been introduced as a new product of NBL.

The year 2006 marked the additional of yet another solid stair in the chronicle of NBL’s success story. Loans and advances of the Bank increased by 21.06% to Taka 3270.97crore during the year under report. The Credit/Deposit ratio stood at 81.100. The ratio of classified loans came down from 7.06% in the previous year to 6.01% at the end of 2006. Import, export and foreign remittance business of the Bank increased by 34.16%, 31.27% and 56.50% respectively. Total operating profit of the Bank increased by 34.71% to Taka 114.68crore. Total assets of the Bank increased by 21.86% to Taka 4679.60crore. Capital adequacy of the Bank stood at 10.10% at the end of 2006, which is fairly above the required minimum rate (9.0%) fixed by the Bangladesh Bank.

At a time when a few bold entrepreneurs came forward for establishing garments industry in the country, NBL extended its mighty hands in providing necessary finances for investment in this sector considering the huge potential for opening up of large employment opportunities and a new horizon of increased foreign exchange earnings for the country. As a result, much needed foreign exchange earnings of the country continued to record spectacular increases through increased export of readymade garments.

National Bank Limited has set an extraordinary example in private sector banking by providing fully supervised collateral free agricultural credit among the poor farmers in the Barendra area of Rajshahi Division for improving their living standard. Besides, NBL has ventured into a new episode of fund deployment by adding petroleum refinery industry in its portfolio financing.

NBL has at its management a group of top ranking and reputed business and social magnets of the country, and a well organized and highly professional workforce. The prudent and telepathic directions and guidance of the Board of Directors and untiring attempt of a team of highly professional and efficient workforce has secured a distinctive and firm position for NBL in the countries arena.

Inspired by its social obligation and commitment, NBL has been running a School and College Up class XII solely on its own guardianship. From the very inception, this institution has been maintaining a good track record of results at the SSC and HSC Examination. As a result of the relentless and sincere attempt of the well educated and trained team of teachers, reputation of the institution has been increasing day-by-day.

Alongside banking business, NBL has also good track record of active strides in the field of country’s sport and games, social service and cultural activities.

NBL is always eager and active to ensure transparency and accountability in its activities. In recognition of this, NBL was awarded Crest for publication of best Annual Report in 1999 and 2000, and Certificate of Application in 2001 by the Institute of Chartered Accountants of Bangladesh.

2.2 Vision  

Ensuring highest standard of clientele service through best application of latest information technology, making due contribution to the national economy and establishing ourselves firmly at home and abroad as a front ranking bank of the country are our cherished vision.

2.3 Mission

Effort for expansion of our activities at home and abroad by adding new dimensions to our banking services are being continued unabated. Alongside, we are also putting highest priority in ensuring transparency, accountability, and improved clientele service as well as to our commitment to serve the society, through which we want to get closer and closer to the people of all strata.

Winning an everlasting seat in the hears of the people as a caring companion in uplifting the national economic standard through continuous s up gradation and diversification of our clientele services in line with national and international requirements is the desired goal we want to reach.

2.4 Business Ideology

Alongside providing best services to the clients, patronizing and taking part in social development activities as well as making due contribution to growth of the national economy.

2.5 Objectives

• Offering quick and improved clientele services through application of modern information technology.
• Playing an important role in the national progress by inculcating improve banker-customer relationship.
• Ensuring highest possible dividend to the respected shareholders by making best use of their equity.
• Pursuing the policy of nurturing balanced growth of the Bank in all sectors.
• Consolidating our position in the competitive market by introducing innovative banking products.
• Ensuring highest professional excellence for our workforce through enhancement of their work efficiency, discipline and technological knowledge.
• Expanding the Bank’s area of investment by taking part in syndicated large loan financing.
• Increasing finances to Small and medium Enterprises (SME) sector including agriculture & agro-based industries, thus making due contribution to the national economy.
• Upholding the image of the Bank at home and abroad by pursuing dynamic and time-befitting banking activities.
• Ensuring maintenance of capital adequacy, comfortable liquidity, asset quality, and highest profit through successful implementation of the Management Core Risk programmed.

2.6 Commitments

In Carrying Ourselves at Work

• Discipline
• Honesty & Integrity
• Sincerity
• Caring
• Creativity

In Serving the Bank

• Loyalty
• Total commitment & dedication
• Excellence through teamwork

In Serving Customer

• Customer-first

• Quality –focus
• Credibility & Secrecy

National Bank’s Goal is to become a leading provider of integrated financial services for small and medium-sized enterprises (SMEs), institutional investors and high net-worth individual in Bangladesh. The Bank intends to achieve this central goal by taking the following measures:

Strategic Direction and the Challenges of the Bank

Although the immediate outlook for the local operating environment is expected to be turbulent, the bank intends to continue its growth momentum through the initiatives and strategic priorities set out in the corporate plan. The Bank is well positioned to mitigate the risks posed by the potential volatility of macroeconomic conditions in the country. The corporate plan and the budget is a mid term plans, yet to being prepared annually covering a period of five years on a rolling basis. This year the Bank prepared the plan for the period covering the years 2009-2010. The strategic direction of the Bank is critically reviewed by the Management as well as by the Board at the time of preparing and approving the Corporate Plan and the Budget. In keeping with the Vision and Mission statement of the Bank, the strategic direction has been clearly identified and laid down in the Corporate Plan. It detailed out SWOT analysis of the Corporate Banking, Personal Banking, Treasury, Information Technology, Human Resources Management and Bangladesh operation of the Bank. Besides it spells out Goals and Objectives of these main segments along with detailed action plans with specific time frames to achieve them.

The Corporate Plan and the Budget incorporates highly ambitious targets target for the planned period. Undoubtedly, the Corporate Plan and the Budget has immensely contributed in guiding the organization to its present level. Further, it has contributed to building up the target driven culture across the Organization and leading to record superlative performance and to maintain the preeminent position in the Banking Industry.

Priorities identified in the Corporate Plan to be implemented in the medium term:

• Enhancing national and international presence as envisaged in the Vision of the Bank
• Consolidation of the Bangladesh Operations by opening more branches
• Maintain the most preferred bank status for trade Finance
• Increase the present credit card base
• Improve exchange turnover and market share
• Improve the quality of advances and overall asset portfolio
• Expanding the remittance business further in the Middle Eastern Countries and some part of Europe
• Improving the risk management infrastructure
• Improving key performance ratio
• Expanding credit and support service to the SME sector
• Increasing the contribution from fee based operations

2.8 Core Values

National Bank’s Core Values consists of 6 key elements. These values bind our people together with an emphasis that our people are essential to everything being done in the Bank.

            “We create new by forming teams of specialists in various fields and providing optimal service to our customers”

Integrity

• NBL protects and safeguards all customer information.
• NBL treats everyone in an equitable and consistent manner.
• NBL creates an environment, which earns and maintains customer trust.

Open Communication

NBL builds customer relationships based on integrity and respect.

• NBL offers a full line of products and excellent service.

• NBL is committed to the prosperity of the customers and shareholders.

Performance Driven

• In NBL, customers and employees are judged in terms of their performance.

Continuous Self Improvement

• Continuous learning, self-challenge and strive make ways for self improvement of workforce at NBL.

Quality

• NBL offers hassle free better service timely
• NBL builds-up quality assets in the portfolio

Teamwork

• Interaction, open communication, and maintaining a positive attitude reflect NBL’s commitment to a supportive environment based on teamwork.

2.9 Nature of Business:

v  The principal activities of the bank are providing all kinds of commercial Banking Services to its customers.

v  The other activities of the bank are providing of all kinds of depository banking services to its customers.

2.10 Corporate mission

• To provide high quality financial services in export and import trade.
• To provide excellent quality service.
• To maintain corporate and business ethics.
• To become a trusted repository of customers money and their financial advisor.
• To make our stock superior and rewarding to the shareholder.
• To display team sprit and professionalism.
• To have a sound capital base.

2.11 Corporate Slogan of National Bank- “A Bank for Performance with Potential”:

National Bank Ltd. as the name implies, is not a new type of bank in some countries on the global, but is the first of its kind in Bangladesh. It believes in togetherness with its customers, in its march on the road to growth and progress with services. To achieve the desired goal, it has intention to pursuit of excellence at all stages with a climate of continuous improvement. Because it believes, the line of excellence is never ending. It also believes that its strategic plan and business networking will strengthen its competitive edge over in rapidly changing competitive environment. Its personalized quality services to the customers with the trend of constant improvement might be cornerstone to achieve its operational success.

2.12 Corporate culture

This bank is one of the most disciplined banks with a distinctive corporate culture. Here we believe in shared meaning, shared meaning and shared sense making. Our people can see and understand events, activities, objects and situation in a distinctive way. They mould their manners and etiquette, character individually to suit the purpose of the bank and the needs of the customers who are of paramount importance to us. The people in the bank see themselves as a tight knit team that believes in working together for growth. The corporate culture we belong has not been imposed; it has rather been achieved through sour corporate conduct.

2.16 Delivering Growth

Managing Knowledge smartly enabled the Bank to remain as one of the leading private bank and given us the edge over our competitors. Integrating Human Resources with the Bank’s systems, processes, know-how, experience and organizational memory has helped the Bank deliver optimum value to customers, employees, shareholders and the nation. Knowledge has been an important driver of value creating over the years.

Discussing our knowledge management strategy is part of our endeavor to report as transparently as possible on all aspects of our operations including those aspects which are less visible such as knowledge generation, retention and application. The role that knowledge plays in the generation of the bottom line is often under-reported and a view to curing this deficiency we provide a flow chart describing how we are delivering growth.

2.14 Sponsors:

The sponsors of National Bank Limited are highly successful leading entrepreneurs of the country having stakes in different segments of the national economy. They are eminent industrialists and businessmen having wide business reputation both at home and abroad.

2.15 Strategies:

• To manage and operate the Bank in the most efficient manner to enhance financial performance and to control cost of fund.
• To strive for customer satisfaction through quality control and delivery of timely services.
• To identify customers credit and other banking needs and monitor their perception towards our performance in meeting those requirement.
• To review and update policies, procedures and practices to enhance the ability to extend better services to customers.
• To train and develop all employees and provide adequate resources so that customer needs can be responsibly addressed.
• To promote organizational effectiveness by openly communicating company plans, policies, practices and procedures to all employees in a timely fashion.
• To cultivate a working environment that fosters positive motivation for improved performance
• To increase direct contract with customers in order to cultivate a closer relationship between the bank and its customers.

ORGANIZATION PART

National Bank Limited

Head Office

19, RAJUK Avenue, 4th Floor, Dhaka.
Tel: (880) (2) 955 8484, 956 4251, 955 4733
Phone: 88-02-956-3081, 88-02-966-6584
Fax: 88-02-956-3953, 88-02-966-9404
Email: nblho@nblbd.com

Some Important Branches

            3, RAJUK Avenue, Motijheel C/A, Dhaka-1000; Phone: 9567558

7-9 B.T.M.C Bhaban, Kawran Bazar, Dhaka- 1205; Phone: 9660445

474 Malibagh, DIT Road, Dhaka; Phone: 9330159

67, Agrabad C/A, Chittagong; Phone: 031-716163-4

Hajee Sharafat Ali Mansion,Chouddagram,Comilla.; Phone: 08020-56207-8

106-109 Shaheb Bazar, Rajshahi.; Phone: 880-721-774483

Chamber Bhaban(1st floor),D.L. Roy Road, Rangpur; Phone: 880-521-65749

KDA C/A, BHBFC Bhaban 15-16, Khulna; Phone: 041-731866

11-12 Garikhana Main Road, Jessore; Phone: 0421-68684

Town Plaza, North Circular Road, Thaurgaon; Phone: 0561-52687

 3.1 Executive Committee

Prof. Mahbub Ahmed                                                 Chairman

Zainul Haque Sikder                                                   Member

Parveen Haque Sikder                                                            Member

Zakaria Taher                                                              Member

A B Tajul Islam                                                           Member

Lt.Col (Rtd) Md Azizul Ashraf, Psc                         Member

A K M Enamul Haque                                                Member

Capt Abu Sayed Monir                                               Member

S M Shameem Iqbal                                                    Member

Managing Director                                                      Ex. Office Member

3.2 Audit Committee

M G Murtaza                                                              Chairman

A M Nurul Islam                                                         Member

Salim Rahman                                                             Member

3.3 Management hierarchy of NBL 

3.4 Description of National Bank Limited

Starting the journey on March23, 1983, the bank within a span of 26 years, has turned into one of the biggest private sector banks in the country having 106 branches and assets over Taka 72,212 million. This is the result of the prudent policies and farsighted decisions taken by the Board, active support from shareholders, depositors, borrowers, other clients and well-wishers, a strong regulatory framework and team work by the efficient executives.

During the year, the Bank has not only made good profit, but also it has enhanced its image further. NBL has now established itself as a local financial institution with international corporate culture, state-of-the art systems, flawless process, superior business ethics, strong control & compliance, good governance, visionary & dynamic leadership, commendable market& product depth and strong financials. National Bank, has now acquired strength and expertise to support the banking needs of the foreign investors. NBL stepped into a new arena of business and opened its Offshore Banking Unit at Mohakhali to serve the wage earners and the foreign investors better than before. National bank, since its inception, was aware of complying with Corporate Social Responsibility. In this direction, directors remain associated with the development of education, healthcare and sponsored sports, and culture and during the times of natural disaster like floods, cyclones, landslides they have extended their hand to mitigate the sufferings to victims. NBL has stepped forward by extending credit to save the industry. The bank has recorded rapid and consistent growth in tough and competitive sector. One of the major reasons for this success has been the commitment of its motivated staff with a strong work ethic. They have been a fine team of people, shared set of priorities and a proud tradition of success.

In fine, considering the Bank’s present shape and strength, it is to hope that National Bank is well poised to meet the challenges of 2009 and Insha-Allah.

3.05 Financial Performances of National Bank Limited:

National Bank Limited is one of the forerunners of first generation private sector commercial banks in Bangladesh. It has strong network of dynamic banking system rendering services through its 106 branches spreading all over the country. It has maintaining strong market base providing quality services through modern technology and by earning profit adding value to the assets of shareholders. The employees are self motivated, pro active and committed to uphold the brand image of the bank. Their motto is to prove the world of their slogan-“A Bank for Performance with Potential”.

In 2008 the bank recorded healthy progress in all area of business.

• 3.5.01 Assets:

The total asset of the bank grew up by 27.75percent to Taka 72,212.80 million in 2008. The significant increasing in assets was achieved due to rise in loans and advances, investments, money at call, short notices, cash and balances with other banks and financial institutions etc.

Cash in hand decreased by Taka 30.80 million or 2.85 percent to Taka 1046.20 million while the balances maintained with the Bangladesh Bank and its agents increased by 28.95 percent at the end of December 2008. The deposit growth increases the balances with Bangladesh Bank and its agent(s) for maintaining the cash reserve requirement (CRR).

• 3.5.02 Liabilities:

Total liabilities increased by 27.19 percent to Taka 66,086.60 million as on 31 December,2008. This was mainly due to increase in customers’ deposits and keeping provision for income tax, gratuity and loan loss, etc.

Deposit:  The deposit base of the bank registered a growth of 25.51percent in the reporting year over the last year and stood at Taka 60,195.20million. Expansion of branch network, competitive interest rate and innovative deposit products contributed to the growth. The customers of the bank were individuals, corporations, financial institutions, government and autonomous bodies etc.

Borrowings from other Banks, Financial Institutions and Agents: The borrowing from other banks, financial institutions and agents increased by 82.85 percent in 2008 over the last year. Borrowing from Bangladesh Bank under the head of Export Development Fund (EDF) was the prime contributory factor for the growth.

Other Liabilities: Other liabilities increased by Taka 1,324.60 million due to current tax liability and for making provision for loan loss. Provision for income tax was Taka 1,310 million in 2008 compared to Taka 796.99 million in the previous year.

• 3.05.03 Operating and Net Profit:

National Bank Limited generated an operating profit of Taka 3,123.80 million in 2008 which was Taka 2,215.10 million in 2007 registering a growth of 41.02 percent. Net Profit after tax grew by 22.56 percent to Taka 1,517.40 million in 2008 after making provision for loan loss and income tax for Taka 295.00 million and Taka 1,310.00 million respectively.

Income:  Interest income increased by 34.95 percent from Taka 4,288.80 million in 2007 to Taka 5,787.90 million in 2008 due to growth of advances. The average yield on advances was 12.94 percent in the reporting year while it was 12.13 percent in the previous year.

The income from investment declined sharply by 15.55 percent to Taka 937.70 million in 2008 from Taka 1,110.40 million in 2007. Commission and exchange earnings increased by 20.57 percent from Taka 1,254.20 million in 2007 to Taka 1,512.10 million in 2008.

Expenses: Overall increase of deposits pushed up the interest expenses by 26.87 percent from Taka 2,833.50 million in 2007 to Taka 3,594.81 million in 2008. Salary and allowances increased by 11.98percent due to yearly increment and for new appointments. Rent and Taxes, Insurance premium, utility charges etc increased by Taka 18.70 million during 2008.

Total operating expenses was Taka 2,174.40 million in 2008 in comparison to Taka 2,134.10 million in 2007.

• 3.05.04 Capital:

Stock Dividend of 55 percent was declared for the year 2007 which increased the paid-up capital of the bank from Taka 1,208.21 million to Taka 1,872.72 million in 2008 while its authorized capital was Taka 2,450 million. The statutory reserve enhanced by Taka 565.60 million in 2008 after maintaining 20percent pre-tax profit. The total equity of shareholders of the bank stood at Taka 6,126.30 million at the end of the year 2008.

Capital Management: Capital Management of the Bank is to maintain an adequate capital base to support the projected business and regulatory requirement. NBL always maintain a prudent balance between Tier-1 and Tier-2 capital.

• 3.05.05 Credit Rating:

Credit Rating Agency of Bangladesh Limited (CRAB) rated National Bank Limited A1 in the long-term and confirms ST-2 rating in the short-term for the year 2008 on the basis of impressive growth rate, improvement in profitability.

• 3.05.06 BASEL II Preparedness:

Main three pillars of Basel II are Minimum Capital Requirement based on credit risk, operation risk and market risk, Supervisory Review Process and Market Discipline. Implementation of Basel II framework will integrate the risk management process of the Bank and its capital adequacy requirement.

• 3.05.07 Treasury :

Treasury is the key point of the Bank to manage the liquidity in both local and foreign currency by ensuring maintenance of CRR, SLR and exchange position of the bank. They are also assigned for measuring, monitoring, and controlling deposit advance ratio, interest rates and various risk elements.

Daily average investment of the Treasury decreased by Taka 1,901.3 million due to rise of deposit advance ratio over the previous year. Treasury invested the fund mostly in Call Lending, Inter Bank Term Deposit, Reverse Repot and various Govt. Securities at 11.71percent weighted average yield, which is 2.17percent higher than that of previous year.

The Treasury of the handled an inflow of USD 1,181.07 million and outflow of USD 1,193.33 million with a grow of 33 and 37 percent respectively. The growth of income from Foreign Exchange stands 14.69 percent over the previous year.

• 3.05.08 Risk Management:

Risk management process involves analysis, evaluation, acceptance and management of certain risk or combination of risk. The ultimate objective is to safeguard the capital and protect the flow of profit generation. It is viewed from a culture perspective than a regulatory compliance. The bank may be exposed to risk in the form of Credit, Liquidity, Market, Operations and settlement risks. There is another dimension to risk matrix namely reputation risk.

The Board and its Committees formulate policies to safeguard and mitigate different risk in line with the organization pattern and the guidelines of Bangladesh Bank which are implemented and monitored by the ALCO, MANCOM, Credit Committee and ICCD of the Bank.

            Credit Risk: Bank’s credit risk arises principally from its financial products and other advances to customers.

            Liquidity Risk: Liquidity risk arises from the mismatch of financial assets including receivables, assets, deposit and other liabilities.

            Market risk: The principal exposure is the risk of loss arising from fluctuations in the future cash flows or fair values of financial assets and liabilities because of a change in achievable rates.

            Operational Risk: Operational risk is the risk of loss arising from a wide variety of causes associated with the institutional processes, personnel, technology and infrastructure and from external factors other than credit, market and liquidity risks. The principal external business risks may affect the institution adversely.

            Settlement risk:  The institution activities may give rise to risk at the timer of non settlement of transactions and trades as contractually agreed.

• 3.05.09 Internal Control and Compliance :

 Banks are facing diversified and complex risks in present days due to deregulation and globalization of banking business and such risk need most priority for sustainable banking operations. Bangladesh Bank has categorized the risk facing the bank in its day-to-day operations in six core heads.

NBL has established ICCD comprising of three independent units namely Audit and inspection, Compliance and Monitoring Unit to mitigate operational risks to an acceptable low level.

ICCD has conducted comprehensive inspection on all the 106 branches adopting the methodology of risk assessment, 13divisions of head office and investigation of 15 cases during the year 2008. Bangladesh Bank has conducted comprehensive as well as special inspection on 36 branches, head office including some of its divisions separately in 2008. Summary of the inspection report were placed before the Audit Committee of the Board of Directors and MANCOM from time to time for review and appropriate steps was taken according to their advice. In the last part of 2008 IT based Officials were posted in this Division to include IT aspects in their comprehensive inspection.

• 02.05.10 Money Laundering Risk Management:

In order to prevent illegal hundi, unauthorized transfer of money and combat terrorism financing, the bank has taken various steps in strict adherence to existing Anti Money Laundering policies, rules & regulation. NBL provides training to its officials to make them aware of existing laws, regulations, policies & procedures.

• 02.05.11 Loans and Advances:

National Bank Limited designed appropriate credit risk management criteria and strategies for balanced lending mix commensurate with sound capacity to finance i the short and the long term credit.

NBL succeeded to increase its’ loans and advances despite the current wave of global recession registering a growth of 36.16 percent with a total loans and advances portfolio of Taka 49,665.1 million in 2008 compared to Taka 36,475.17 million of 2007. The growth was due to injecting significant amount of fund in new ventures of Syndicated loan, Project loan, Lease finance, SME, Agri loan, etc. and usual growth in Foreign Trade.

NBL was cautious in the later half of the year when the global economy started to meltdown into a possible recession. Financing Trade and Commerce remained a strong focus on multi dimensional industries in textile, telecommunication and Pharmaceuticals sectors. To uplift the base for further export growth financing on RMG sector was given extensive support.

Rural Micro Credit and Agricultural Financing: Echoing with the national importance and policy direction for development of rural economy, the bank took the strategy of upgrading the lending portfolio in the reporting year. The bank has been providing collateral free loans to landless and marginal farmers to acquire seeds, fertilizer, irrigation facility, agri equipments etc for better crop cultivation. Apart, bank has also been financing in fish, poultry, & livestock farming sector as well as to weavers.

Small and Medium Enterprise Financing:Small and Medium Enterprise (SME) financing was one of the key drives in credit expansion. NBL underscores the importance of this financing in terms of national outlook. In this respect, institutional strengthening measures were undertaken by developing a sound human resources base to enable SME financing through a large networks of 106 dispersed delivery channels of the bank. Development and support to entrepreneurs in various fields to trade and industry received a major attention and thrust from NBL. Future challenges in this area are identified and appropriate action plans are rolled on.

 Syndication, Project and NBLFI Financing: National Bank has entered into sizeable deals in Syndication, NBFI and in project financing to ensure industrial growth through term and working capital lending in co-operation with other banks. Total amount of Taka 9,300 million was approved under 41deals through this financing window during the year 2008 as against an amount of Taka.10, 320 million under 36 deals of previous. Spinning, RMG, Pharmaceuticals, Power, Food industries were linked to these finance. The bank also made credit available to various non-banking financial institutions and NGOs to extend a timely support for diversified growth of credit capacity of these participating institutions at large.

Lease Financing: National Bank Limited has been providing Lease finance and part of its continued product re-engineering process. Relatively easier and competitive pricing has attracted new and preoperative entrepreneurs to avail the facility. Industries/business obtained the finance to acquire capital machinery, equipments, medical instruments, automobiles for installation of new industries or for BMRE of existing industries that supported new entrepreneurs and efficient management of output. The bank sanctioned an a mount of Taka.330 million in 2008 as against Taka.82 million in 2007 resulting in an increase of 302.44 percent over the previous year.

            Housing Loan Financing: Recognizing that raising living standard is not a luxury any more, be it in urban society or in rural economy, the bank launched housing loan schemes for catering to this essential demands of the time. NBL structured the products to suit the long term needs of the clients at reasonable pricing in affordable terms. The loan is available for construction of house or to purchase apartment generally for residential purpose.

• 3.05.12 Credit Administration:

The asset of the bank is exposed to so many risks both external and internal. Profit Maximization of a bank depends on optimum utilization of its assets. Identification of risks and its mitigation saves the assets of the bank from erosion. The Bank structured devises and pragmatic approaches to pin point the inherent risks associated with loans and advances and keeps constant follow up of the credits, right form its sanction and continues its efforts to keep the credits performing and unclassified. With constant vigilance default culture in the bank has substantially declined.

• 3.05.13 Classified Loans and Advances:

One of the top most priorities of the bank is to realize the classified loans and advances. The amount of classified loans was Taka.2, 729.32 million as on 2008 showing an increase of 65.30percent where it was Taka.1, 651.0 million in 2007. Though few loans and advances were turned into non-performing due to some external political and economic factors, the bank has been able to contain its volume within a tolerable level of 5.50 percent of the total advance by exerting all out efforts. During the year under review, the bank recovered Classified Loans and advances and written Off Loans for Taka.236.4 million and Taka.153.4 million respectively.

• 3.05.14 Provision:

The bank maintained provision of Taka.1,906.67 million as on 31.12.2008 against requirement of Taka.1,443.6 million comprising of Taka.784.91 million and Taka.1,121.8 million for performing and non performing loans respectively.

• 02.05.15 Foreign Trade:

As in the previous years, National Bank was keenly active in international trade during the year 2008 and financing of export-import trade, mobilization of wage earner’s remittances from abroad etc. Besides, the Bank expanded its external business by undertaking export bill negotiations, realization of export proceeds, foreign remittances etc.

 Imports: The Bank opened a total number of 21,210LCs amounting USD 1,130.96 million in import trade in 2008 with a growth of 25 percent over the previous year. The main commodities were scrap vessels, rice, wheat, edible oil, capital machinery, petroleum products, fabrics & accessories and other consumer items.

 Exports: The Bank has been nursing the export finance with a special attention since its inception. In 2008 it handled 16,234 export documents valuing USD 531.03 million with a growth of 14 percent over the last year. Export finances were made mainly to readymade garments, knitwear, frozen food and fish, tanned leather, handicraft, tea etc.

 Remittances: In 2008, foreign remittances brought into the country through NBL were USD 582.47 million showing an increase of USD 179.90 million over the previous year, which registered an attractive growth of 45 percent. This growth was possible due to introduction of different instant payment products and technology including extending SWIFT, Online, EFT etc. and further efforts are being made for more speedy payments.

 Operation:

Now-a-days it is needless to mention that homebound foreign remittance is significantly contributing in building Foreign Exchange Reserve of the country. Realization the prospects of the sector, The bank since its inception is gradually establishing its network where concentration of Bangladesh expatriates is higher. With the time, NBL earned the confidence and trust of the Bangladeshi wage earners and successfully handling a sizeable volume of remittances, which is increasing day by day.

 Arrangement: Besides fully or partially owned Exchange Companies located in 13 countries.

Exchange House owned by NBL:

Oman: NBL invested 25% equity on Gulf Overseas Exchange Company LLC (GOEC), A joint venture exchange company in Oman, operating since November 1985 under management of the bank having 5 branches in the potential locations of that country.

Singapore: Balaka Exchange Pte Ltd, Singapore went into operation in September 1999 under the management of NBL. Subsequently to boost up its activities, National Bank acquired 100 percent ownership of Balaka, as its subsidiary in 2007.

Malaysia: NBL Money Transfer Company Sdn, Bhd, a fully owned subsidiary company of National Bank is going to start operation in Malaysia by May2009.Neccessary approvals have been obtained from the competent authorities in home and in Malaysia.

Myanmar: A representative office was established in Yangon, Myanmar in October 1996 and obtained permission from the government of Bangladesh to handle border trade with Myanmar.

• Western Union Financial Services Int’l: NBL opened up the way to introduce Western Union Financial Services Int’l in Bangladesh through an Agency Agreement in 1993. Western Union, a global leader in money transfer services, with a history of services dating back for more than 150 years and presently have agents over 3,20,000 worldwide.

• Off Shore Banking Unit:

Off Shore Banking is a unique solution for Banks across the globe to carry out international banking business involving Non-resident foreign currency denominated assets and liabilities taking the advantages of low or nonexistent taxes/levies and higher return on investment. Alongside the presence in the commercial hubs of the country, NBL has taken a position to extend its network in the special export processing zone created for foreign investors and local entrepreneur engaged in 100 percent export based industry. Under the license issued by Bangladesh Bank NBL opened its first Offshore Banking Unit in 2008 at Mohakhali Branch, Dhaka adding a new dimension in its customer friendly business activities.

•  SWIFT:

The safe, quick, and reliable media of financial transactions through SWIFT has been a practical shepherd of NBL since long. At present all the 30 Authorized Dealer branches of NBL have been brought under the services of SWIFT. The global concept of Bilateral Key Exchanges (BKE) is superseded by a new system of Relationship Management Application (RMA) effective from January 2009. To cope with the new system NBL has completed establishing of RMA with the foreign correspondents worldwide including local banks as well.

•  Reconciliation of Accounts:

The work of inter branch reconciliation of accounts gained momentum of introduction of new method of on-line system by using in-house software quickly and accurately. Inter branch exchange of data of all branches has been connected to the server at the head office through dial-up internet arrangement.

•  Merchant Banking:

National Bank Limited is playing an effective role in capital market of the country and remains engaged in various activities related to IPOs such as banker to the issue, underwriting etc. In 2008 NBL has earned an amount of Taka.3.98 million from this arena.

•  NBL Capital Market Services:

With a view to generate more income by diversifying bank’s activities, NBL Capital Market Services (NBL-CMS)started its operation on 9^th January 2008 with efficient and experienced personnel using modern infrastructural facilities. The services include opening BO account, depository services of CDS, trading in share market, financing the clients under Margin Rule and counseling the investors regarding stock market. By rendering efficient services bank has been able to earn an amount of Taka.101.20 million in 2008.

•  Investor Relations:

NBL aims to provide investors analyst with clear and detailed information on the activities and operations of the Bank. The Bank’s website, www.nblbd.com, provides easy access to wealth of information, press releases, regulatory announcement to stock exchanges, new products, annual report, half yearly results, event calendar and an archive with a detailed search interface as well as other information for market participants, shareholders and others. The IT team always strives to update the website with the most recent information available and to include new features when appropriate.

• Credit and Debit Cards:

National Bank Limited is the pioneer in introducing Credit Cards amongst the local banks and financial institutions way back a decade. Banks firstly introduce the Master Card in 1997 and also introduced Visa Card in 2003. Now the bank is issuing and acquiring world’s most popular brand of Cards commonly known as Master Card and Visa Card.

The bank has a clientele of its Credit Card across the country covering the class of elites, VIPs, CIPs and also the middle class.

Bank introduced debit card namely NBL Visa Power Card in 2006, a product free from the burden of loans and interest. Bank’s income from card business was Taka.120.4 million in 2008 showing an increase of Taka.19.2 million than that of previous year.

•  Information Technology:

To win edge through service, profitability and latest technology application, the bank has started expansion of its IT platform through implementation of “Any Branch Banking”. So far 15 branches were brought under the system providing coverage of WAN connectivity. It has been planned to bring most of the branches under the facility by June 2009.

[VIP=Very Important Person;  CIP= consumer Important products]

•  Logistic Support and Branch Expansion:

In 2008 five (5) new branches were opened in different locations of the country. Renovation and refurbishment of six (6) branches were done in 2008.

•  Human Resources Management:

Peoples are the most valuable assets of the bank and success depends on better management of human resources. The bank has focused on nursing and building the skills and competencies of staffs at various grades to create a wealth of knowledge for the current and future needs of the Bank. The bank keeps on developing and refining the quality of dedicated team who can synergies their common creativity towards achieving continuous excellence supported by compassionate management.

•  Corporate Social Responsibility:

Beyond the financial target and growth, NBL is also very conscious about their social responsibilities, the bank keep associated with the development of education, sports and cultural activities. The National Bank Foundation has been running National Bank Public School and College at Moghbazar, Dhaka and acquired praise of the people. Total enrolment of students was 1,140 in school and college section in 2008.

•  Shares of National Bank Limited:

The existing authorized capital of the company is Tak.245.00 crore and paid up capital is Taka.187.27 crore. The Board of Directors of the Bank is very much aware about the latest directive by the Bangladesh Bank to raise the paid up capital to Taka.200 crore by June 2009.

•  Dividend:

The Board of Directors of the National Bank Limited has been pleased to recommend Stock Dividend @52 percent to the shareholders of the bank based on the accounts for the year ended 31 December 2008.

•  Board & Committee Meetings:

The Board of Directors of the Bank met in eight meetings during 2008 and issued specific directions conducting affairs of the bank. On the other hand, The Executive Committee and Audit Committee of the board of directors me 34 meetings and 13 meetings respectively and gave valuable decisions.

3.6                        Highlights on the overall activities of

National Bank Limited

                                                                                                (Taka in million)

 FUNCTIONS OF ACCOUNTING PROCESS

4.1 Functions of National Bank limited:

• To maintain all types of deposit A/Cs.
• To make investment.
• To conduct foreign exchange business.
• To conduct other Banking services.
• To work for continues business innovation and improvements

Different Departments of National Bank Limited

• Accounts opening
• Deposit
• Local remittance
• Foreign remittance
• Clearance
• Credit
• Advance
• Accounts
• Cash
• Export Import Sector

Accounts Section

Accounts Department is called as the nerve Centre of the bank. In banking business, transactions are done every day and these transactions are to be recorded properly and systematically as the banks deal with the depositors’ money. . Improper recording of transactions will lead to the mismatch in the debit side and in the credit side. To avoid these mishaps, the bank provides a separate department; whose function is to check the mistakes in passing vouchers or wrong entries or fraud or forgery. This department is called as Accounts Department. If any discrepancy arises regarding any transaction this department report to the concerned department.

Besides these, the branch has to prepare some internal statements as well as some statutory statements, which are to be submitted to the Central Bank and the Head Office. This department prepares all these statements.

4.2 Functions of Accounting department of NBL:

• Recording the transactions in the cashbook.
• Recording the transactions in general and subsidiary ledger.
• Preparing the daily position of the branch comprising of deposit and cash.
• Preparing the daily Statement of Affairs showing all the assets and liability of the branch as per General Ledger and Subsidiary Ledger separately.
• Making payment of all the expenses of the branch.
• Recording inters branch fund transfer and providing accounting treatment in this regard.
• Preparing the monthly salary statements for the employees.
• Preparing the weekly position for the branch which is sent to the Head Office to maintain Cash Reserve Requirement (C.R.R)
• Preparing the monthly position for the branch which is sent to the Head Office to maintain Statutory Liquidity Requirement (S.L.R)
• Make charges for different types of duties
• Preparing the budget for the branch by fixing the target regarding profit and deposit so as to take necessary steps to generate and mobilize deposit.
• Checking of Transaction List
• Recording of the vouchers in the Voucher Register.
• Packing of the correct vouchers according to the debit voucher and the credit voucher

4.3 Online Banking:

The main features of National Bank online Banking are as follows:

• Centralized Database
• Platform Independent
• Real time any branch banking
• Internet banking interface
• ATM interface
• Corporate MIS facility

The functions of accounting process of National Bank Limited:

4.4    Bucket Statement

Bucket Statement: National Bank Limited prepares Bucket Statement monthly. Bucket Statement is an accounting statement containing four parts. This statement prepared at the last date of the month.

            Four parts of Bucket Statement are as follows:

• Asset Maturity Bucket
• Liability Maturity Bucket
• Interest Rate Risk Maturity Bucket
• Data Sheet.

Asset Maturity Bucket: Asset Maturity Bucket represents all the information regarding assets of National Bank of that month.

Asset Maturity Bucket contains two types of assets as-

1. On Balance Sheet Asset
2. Off Balance Sheet Asset

Total Asset = On Balance Sheet Asset + Off Balance Sheet Asset

1. On Balance Sheet Asset: The assets those are recorded in the Balance Sheet, are maintained in the Bucket Statement, are on balance sheet asset.

a. Cash in Hand

b. Foreign Currency in Hand

c. Balance with Bangladesh Bank

d. Investments

e. Balance with other Bank

f. Fixed Asset

g. Other Asset

h Non Banking Asset

i. Total Expenditure

j. Loan and Advances: Loans and advances are in various types as

1.              I.      Loan General
2.           II.      Transport Loan
3.        III.      LIM ( Loan against Import Merchandise)
4.        IV.      LTR ( Loan against Trust Receipt)
5.           V.      Packing Credit
6.        VI.      HouseBuilding Finance
7.     VII.      EDF Loan
8.  VIII.      PAD ( Purchase against Documents)
9.        IX.      Cash Credit(Pledge)
10.           X.      Cash Credit ( Hypothecation )
11.        XI.      Overdraft
12.     XII.      Consumer Credit Scheme
13.  XIII.      Staff Loan
14.  XIV.      Loan against Cash Assistance
15.     XV.      In hand Bill Purchased
16.  XVI.      Foreign Bill Purchased
17. LDBP( Local Documentary Bills for Collection)
18. Rural Credit
19.  XIX.      Other.

2. Off Balance Sheet Asset: The assets those are not recorded in the Balance Sheet, are maintained in the Bucket Statement, and are off balance sheet asset.

a. LC (Letter of Credit)

b. Bank Guarantee

c. Other off balance sheet asset.

Liability Maturity Bucket: National Bank Limited prepares Liability Maturity Bucket as a part of Bucket Statement at the last date of the month. It represents all the information regarding liabilities of National Bank of that month.

Liability Maturity Bucket contains two types of liabilities as-

1. On Balance Sheet Liability
2. Off Balance Sheet Liability

Total Liability = On Balance Sheet Liability + Off Balance Sheet Liability

1. On Balance Sheet Liability: The liabilities which are recorded in Balance Sheet. On balance sheet liabilities are as follows:

a. Capital

b. Revenue and Surplus

c. Bills Payable

d. Borrowing from Bank

e. Total Income

f. Other Liabilities

g. Deposits: National Bank Limited has various types of deposits as

1.              I.      Current Deposit
2.           II.      Savings Deposit
3.        III.      Short term Deposit
4.        IV.      Fixed Deposit
5.           V.      Bearer Certificate of  Deposit
6.        VI.      Security Deposit Receipt
7.     VII.      Call Deposit
8.  VIII.      Non Resident Taka Deposit
9.        IX.      Sundry Deposit
10.           X.      Online Credit account
11.        XI.      Foreign Currency Deposit
12.     XII.      Deposit from Investors Scheme
13.  XIII.      FC held against Bangladesh Bank LC
14.  XIV.      Exchange Company Taka Account
15.     XV.      RFCD( Residence Foreign Currency Deposit)

2. Off Balance Sheet Liability: The liabilities which are not recorded in Balance Sheet. Off balance sheet liabilities are

a. LC

b. Guarantee

c. Others.

Interest Rate Risk Maturity Bucket: It is necessary to calculate the interest rate and maturity of any deposit. National Bank Limited prepares Interest Rate Risk Maturity Bucket at the last of the month.

Interest Rate Risk Maturity Bucket is prepared by following components.

Total Customer Asset

Approved Securities

Balance with Other Bank

Other Asset

 Total Asset: =

Total Customer Deposit

Borrowing from Bank

Bangladesh Bank

Other Bank

Equity

Other Liability

Total Liability:  =

Data Sheet: Data Sheet is the last portion of Bucket Statement. It contains the combination of previous three statements. It is not possible to prepare Data Sheet without above information.

Data Sheet presents following information:

1. Volume of working Fund
2. Interest paid
3. Manpower Expenses
4. Other Expenses
5. Non interest Expenses
6. Total Expenses
7. Interest Earned
8. Non interest Income
9. Total Income
10. Spread
11. Burden
12. Profit

National Bank Limited can take any necessary decision in accordance to the information of Bucket Statement, which represent the overall financial condition of a particular month.

4.5    Daily Statement

Daily Statement is a most important statement to calculate the transaction of a day. It is prepared at the end of the day. Daily Statement provides actual position as well as asset & liability of National Bank limited. It contains following information as

1. Total Deposit
2. Total Sundry Deposit
3. Total Loan and Advances
4. Total Bills Payable
5. Cash in Hand
6. Prize Bond
7. FC in Hand
8. Bangladesh Bank (LCY)
9. Bangladesh Bank (FCY)
10. Sonali Bank (as an agent of Bangladesh Bank)
11. Islami Bank Bangladesh Limited (as an agent of Bangladesh Bank)
12. Standard Chartered Bank Limited ( as an agent of Bangladesh Bank)

4.6                                           Transfer Book

Transfer Book is one of the daily activities of Accounting Process. It is a handwritten function. Accounts Officer has to make entry of each and every transaction in Transfer book without cash and clearing voucher.

Transfer Book contains two side of transaction as Debit and Credit. Each and every transaction has to have equal amount on both side of transfer book. All the vouchers, documents, instruments recorded into transfer book should contain transfer seal as well as transfer no. of the book. At the end of the day transfer book of that day is summarized and the summed amounts also have to have equal Dr. and Cr. From the transfer book the number of voucher made on that day is calculated to record in Voucher Register.

4.7                                          Voucher Register

Voucher Register is a record book of no. of voucher. Number of voucher made each day is recorded in voucher register as per date and under particular head.  No. of vouchers are recorded under following head as:

Ledger C/D: No. of voucher made on Current Deposit on a particular date.

a. Ledger S/B: No. of voucher made on Saving Deposit on a particular date.

b. Ledger Cash Book: No. of voucher made on Cash Book on a particular date.

c. Ledger Income/ Expense: No. of voucher made for income and expenditure on a particular date.

d. Ledger B/L No. of voucher made for Bills Payable on a particular date.

e. Ledger Subsidiary: No. of voucher made for subsidiary on a particular date.

f. Ledger IBTA: No. of voucher made for CIBTA and CIBTA Online on a particular date.

g. Ledger HDS/FC: No. of voucher made for Foreign Currency on a particular date.

h. Ledger Loan: No. of voucher made for Loans and Advances on a particular date.

i. Total Ledger: Summation of no. of voucher made on above head on a particular date.  

4.8   Cash Book Record

Cash book record is one of the daily statements prepared at the next day of working day. National Bank Limited prepares Cash Book Record to know the actual condition of Cash Book. In Cash Book Record the information is gathered from data sheet of bank record of previous day. In Cash Book Record the Dr. Amounts of data sheet is placed at the Cr. side of cash book record and the Cr. amounts of data sheet is placed at the Dr. side of cash book record. The information of Cash Book Record is maintained as following head and serial.

Total Voucher = CIBTA + Subsidiary + Bills Payable + Current Deposit + Savings + Cash book + Loan + Income Expenses.

CIBTA: Summation of amount of CIBTA and CIBTA Online is recorded under CIBTA.

Subsidiary: Summation of amount of Sundry Deposit and Sundry Asset is placed under subsidiary.

Bills Payable: Summation of amount of Pay Order issued, Pay Slip issued, Demand Draft Payable is placed under Bills payable.

Current Deposit: Amount of current deposit is placed under C/D.

Savings: Amount of Savings Bank Deposit is placed under Savings.

Cash book: Summation of amount of Short Term Deposit, Fixed Deposit, Monthly Savings Scheme, NBL Monthly Savings Scheme, Local Bills for Collection, Local Documentary Bills for Collection, Bank’s Liability.  

Loans: Summation of amounts of Loans General, SOD General, Cash Credit, Packing Credit, Local Documentary Bills Purchased.

Income Expenses: Summation of amounts of income and expenditure is placed under Income and Expenditure.

4.9  Supplementary

National Bank Limited prepares supplementary to keep record of about all the transactions occurs in a working day. Supplementary is one of the daily activities of accounting process which is prepared at the next day of any working day. In Supplementary all the instruments and documents are kept under particular head with initial chq, vouchers, and office record sheet etc. Each and every head of Supplements contains Dr. and Cr. portion respectively.

1. Supplementary for Cash Credit

1.1: Credit Supplementary for Cash Credit: It contains credit vouchers, deposit slip of CC account containing a/c code 3700.

1.2: Debit Supplementary for Cash Credit: It contains vouchers and Chq of CC account, vouchers of Commission/Postages/Vat of OBC.

2. Supplementary for Fixed Deposit (FDR)

2.01: Credit Supplementary for Fixed Deposit (FDR): It contains Cr voucher of FDR   A/C and Cr voucher of amount of Interest paid on FDR.

2.02: Debit Supplementary for Fixed Deposit (FDR): It contains Dr Voucher of Income tax realized from the interest paid on FDR, Dr Voucher of excise duty realized from the interest paid on FDR.

3. Supplementary for Secured Over Draft (SOD)

3.01: Credit Supplementary for Secured Over Draft (SOD): It contains Cr voucher and deposit slip of SOD account.

3.02: Debit Supplementary for Secured Over Draft (SOD): It contains Chq of SOD account.

4. Supplementary for Income

4.01: Credit Supplementary for Income: It contains Cr voucher of Income Commission.

4.02: Debit Supplementary for Income: It contains Dr voucher of income.

5. Supplementary for Short Term Deposit

.5.01: Credit Supplementary for Short Term Deposit: It contains deposit slip and Cr voucher of Current account of no.3600.

5.02: Debit Supplementary for Short Term Deposit: It contains Dr voucher of current account.

6. Supplementary for NBL Monthly Savings Scheme

6.01: Credit Supplementary for NBL Monthly Savings Scheme: It contains Deposit Slip of NMS.

6.02: Debit Supplementary for NBL Monthly Savings Scheme: It contains Dr voucher of NMS closing charge.

7. Supplementary for Savings Bank Deposit

7.01: Credit Supplementary for Savings Bank Deposit: it contains Cr voucher or deposit slip of Savings Account, Cr voucher of TT for S/B account, voucher of incoming TT.

7.02: Debit Supplementary for Savings Bank Deposit: It contains Dr voucher of Savings account and voucher of closing charge of S/sb account.

8. Supplementary for Current Deposit

8.01: Credit Supplementary for Current Deposit: It contains Cr. voucher and deposit slip of Current account.

8.02: Debit Supplementary for Current Deposit: It contains Dr voucher of current account.

9. Supplementary for Liability

9.01: Credit Supplementary for Liability: It contains Cr voucher of sundry deposit and voucher of “Vat on Online charge”.

9.02: Debit Supplementary for Liability: It contains Dr voucher of sundry deposit.

10. Supplementary for Demand Draft

10.01: Credit Supplementary for Demand Draft: It contains Cr voucher of Demand Draft received.

10.02: Debit Supplementary for Demand Draft: It contains Dr voucher of Demand Draft paid.

11. Supplementary for Pay Slip

11.01: Credit Supplementary for Pay Slip: It contains Cr voucher of pay slip with head Bills Payable.

11.02: Debit Supplementary for Pay Slip: It contains Dr voucher of Chq of Pay Slip.

12.01: Credit Supplementary for Payment Order: It contains Cr voucher of Bills Payable P. O. issued with Pay Order No., Pay Order Application of P. O., and Cr. voucher of Pay order received.

12.02: Debit Supplementary for Payment Order: It contains Dr voucher of Chq of Pay Order with documents of receiver.

13. Incoming Online Registered for all A/C type:

13.01: Incoming Online Received (Credit) Registered for all A/C type: It contains Cr voucher of amount of credited against cash received by branches.

13.02 Incoming Online Payment (Debit) Registered for all A/C type: It contains Dr voucher of amount of debited against cash payment with chq no and drawer.

    14. Journal Outgoing Transaction for Savings bank Deposit

14.01: Journal Outgoing Credit Transaction for Savings bank Deposit: It contains Cr voucher of deposit slip of SB A/C and deposit slip for online transaction charges.

14.02: Journal Outgoing Debit Transaction for Savings bank Deposit: It contains Dr voucher or Chq of SB account, Online transaction slip.

 Salary Statement

Salary statement is a required statement which must be prepared afte4r a certain time period. Generally salary statement is prepared at the last of each and every month. Salaries of all the personnel are prepared according to salary structure given by authorities. Any changes in salary structure are done in accordance to circular of Head Office. Salary amount is transferred to personnel’s account by Account Officer.

Salary statement is prepared with following aspects with different amount and different percentage in accordance to position of employees.

­

Basic Salary                                               ********

Allowances (add)

House Rent                                         *****

House Maintenances Allowances       *****

Utility Allowances                              *****

Convey Allowances                            *****

Medical Allowances                           *****

Lunch Allowances                              *****

Risk Allowances                                 *****

P. F. Contra                                         *****

Dearness Allowances                          *****

Total Allowances                                                       ********

                                                                   ………………

Gross Total                                                          *********

Deductions (less)

Income Tax                                         *****

EHBL                                                 *****

Safety Scheme                                                *****

P/F Loan                                             *****

CCS Loan                                           *****

Revenue Stamp                                   *****

Well Fare Fund                                   *****

P/F Contra Bank                                 *****

Total Deductions                                                       ********

                                                                   …………………..

Net Total                                                    *********

The Net Total amount is paid to the employees to their bank account.

 SBS Scheduled Bank statistics Introduction:

The monthly SBS-1 return is the basic return for collecting data on monetary and financial statistics prepared on the basis of SBS-1 return are used for formulating monetary policy of the country by The Government and The IMF use these information in evaluating the monetary situation of the country. Proper recording of data in SBS-1 return for compilation of a consistent database is, therefore, extremely vital. Detailed instruction, explanations and definitions are provided in the booklet to help the bank branches in reporting data of monetary statistics and link them to their internal accounting system.

Section-2: General Instruction:

a)      Head Office of reporting banks consolidate the SBS-1 returns received from all their bank branches. They ensure that the consolidated SBS-1 return is final and submit to the Statistics Department, Bangladesh Bank, Head Office, Dhaka by the end of the month following the one tom which it relates.

b)      The individual amount pertaining to each item should be added up and the total thus arrived at should be rounded off to the nearest thousand taka and reported in the SBS-1 return.

c)      While filling in the SBS return for submission, the data should be typed or written legibly in ink and in no case in pencil.

d)     Before filling in the SBS-1 return the definitions, explanations and instructions provided in Section-3, 4 and 5 of the booklet should be carefully gone through. Intensive care should also be taken so that the figures are reported correctly against the proper heads of assets and liabilities in the SBS-1 return.

e)      The definitions, abbreviations etc. used in this booklet are given in the Appendix.

f)       While submitting the consolidated SBS -1 return to Bangladesh Bank, Head Office of the banks should also furnish a certificate showing the following information.

1. Total number of branches of the bank………………………..
2. Total number of branches covered for the consolidation of this return……………………………………………………
3. List of non-reporting branches showing the method (estimation or repetition) of arriving at the consolidated statement against each of non-reporting branches………….

g)      For all queries regarding SBS-1 return, reporting branches of banks and their Head Offices may contact the Statistics Department, Bangladesh Bank, Head Office, Dhaka.

Explanation of Tables of SBS-1 return

Section -4

Some items of SBS-1 return have been classified in the tables given overleaf. In table –A total deposit liabilities of banks have been classified by Sectors/Instruments. Table –B is for the detail reporting of foreign assets and liabilities in foreign currency. In Table-C loan classification and provision and loans write-off have been classified in Table-D.

 The explanations and guidance to fill in the tables have been given below:-

Deposit classification Matrix by Sectors and Instruments

Deposit classification Matrix comprises of all taka deposits & equivalent taka of margin deposit- foreign currency. It is to be noted that the taka deposits of Convertible taka accounts of foreigners, Foreign Currency Accounts of Non-resident, Balances of NFCD account Non-resident taka accounts of foreign bank branches & correspondents should be excluded from Deposit Classification Matrix. Banks are to report their instrumental deposit of different sectors against respective codes in Table-A. The aggregate total of deposit of all columns should be equal to the aggregate total of deposits of all rows of the Matrix. Banks are to report the aggregate total against the code of sector & instruments are given in Section-3 at page2-7.

Details of Foreign Assets & Liabilities

The bank up of foreign currency of the taka amounts reported against the Code No. 17601, 17603, 17604, 17608& 17609 of the liabilities side and against the Code No. 22601, 22602, 22603, 22604, 23601, 23602, 24600 & 26600 of the assets side of the SBS- 1 return is to be reported in units of that currency.

In case of conversion of the foreign currency into taka the instruction given in section-3 against the respective codes should be meticulously followed. To convert the foreign currency into taka the end month middle closing exchange rate (supplied by Bangladesh Bank) should be used & the taka amounts should be reported in the SBS-1 return. For the purpose of balancing the difference in taka account due to conversion are to be adjusted with the Valuation Adjustments or with the valuation Adjustments.

Loan Classification & Provision

Loans and Advances provided by the banks to different sectors should be classified and provisions for those loans and advances should be made according to BCD Circular No. 34, dated 16^th November, 1989; BCD Circular No. 20, dated 27^th December, 1994 & BRPD Circular No.16, dated 6^th December, 1998 of Bangladesh Bank. Classified and unclassified loans and their provisions should be reported in Table-C. Total amount of loans reported against items 6 and 7 of the assets side of the SBS-1 return should be reported in Table-C according to sector and loan classification.

Loans write off should be made according to BRPD Circular No. 02, dated  13^th January, 2003 and the amount of loans write off made by the banks should be reported in Table C  against respective Sectors as memorandum item. Cumulative loans write off should be reported.

 Classification of Total Investment

1. Unencumbered Approved Securities (Code No.33100)

The amounts of unencumbered approved securities should be reported against the Code No. 33100 in Table-D. Banks are to determine the amount of unencumbered approved securities as per definition stated below:

            Definition: Unencumbered Approved Securities

In terms of Section No. 33 of the Banking Companies Ordinance, 1991 the following securities have been declared as approved securities.

a)      All promissory Notes, Bonds, Treasury bills and any other securities of the Govt. of Bangladesh.

b)      Bangladesh Savings Certificates.

c)      Debentures of the Nationalized Institutions which are guaranteed by the Govt. of Bangladesh but are not marked “Non-Transferable”.

All kinds of above- noted securities held with a banking company will be treated as “Unencumbered Approved Securities” for the purpose of Section 33 of the Banking Companies Ordinance, 1991 provided that these Se4curities are free from any encumbrance. Approved securities lodged with another institution for an advance or any other credit arrangement to the extent to which such securities have not been drawn against or availed of are also treated as unencumbered approved securities.

2. Encumbered Approved Securities (Code No. 33111&33112)

a)      Against REPO:

Bangladesh Bank develops repurchase agreements with commercial banks for the purpose of short-term liquidity management. Repurchase agreements are arrangements whereby a bank sells securities at a specified price under a commitment to repurchase the similar securities at a later date. The agreement generally represents a form of short term borrowing in which the third party securities represent collateral for transaction. By treating the repurchase agreement as a means of short-term lending against which the assets in question only serve as collateral rather than as a means of changing the ownership of those assets. The treasury bills that are being used as collateral be separately identified from other treasury bills in the accounts of the banks and it should be reported against REPO in code 33111 in Table –D.

b)     Others:

Other encumbered approved securities should be reported against other in code 33112 in Table-D.

   3. Other Investments (unapproved securities)

All kinds of unapproved securities (such s share, debenture of the private and public companies) held with a banking company should be reported against this code 33113.

Section- 5 Details of Sector and Their Companies:

The sectors into which the data of SBS-1 return have to be classified by the reporting banks comprise the Government. Deposit Money banks, Non-bank Depository Corporation, Other Financial Intermediaries, Public Non Financial Corporations, the Local Authorities and the Private Sector (Including both households and enterprises). In addition, Bangladesh nationals working abroad are separated out the resident sector because of their centre of interest and the nature of their accounts.

1. A.    Government Sector

The Government sector is divided into three categories for reporting of data in SBS-1 return.

a)      FOOD MINISTRY (INCLUDING DIRECTORATE OF FOOD)

b) PRESIDENCY, PRIME MINISTER’S OFFICE, PARLIAMENT, JUDICIARY, ALL OTHER MINISTRIES AND RELATED DIRECTORATES/DEPARTMENTS.

Other Private Sector

 1) Other Non Financial Corporation

The Other non-financial corporations sector encompassed corporations and quasi corporations engaging primarily in the production of goods and non-financial service. Other non-financial corporations comprise foreign controlled and national private non-financial corporations. Foreign-controlled non-financial corporations are resident non-financial corporations and quasi corporations controlled by non-residents. National private non-financial corporations are resident non-financial corporations and quasi corporations are not controlled by Government or non-residents. Such as:

a)      Private Manufacturing Companies

b)      Private Exporter/ Importer/ whole sale trader/ Retail trader and other business institutions.

c)      Private Transport Companies

d)     Private Construction Companies

e)      Private Telephone Companies

f)       Private Housing Companies

g)      Private Storage Companies

h)      Private News Media

i)        Private Educational Institutions

j)        Other Private profit institutions

k)      NGOs (Profit earnings)

2) Non Profit Institutions Serving Household (NPISH)

The NPISH sector comprises a sub set of non-profit institutions. NPISH s are mainly engaged in providing goods and services to households or the community at large or at prices that are not economically significant (and thus are classified as non market producers), except those that are controlled and mainly financed by government units. NPISHs are mainly financed from contributions, subscriptions from members, or earnings on holding or real or financial assets. NPISHs are consists mainly of associations such as trade unions; professional or learned societies; consumers’ associations, political parties (except is included in general government); churches and religious societies (including those financed by government); social, cultural, recreational, and sports club; and organizations that provide goods and services for philanthropic purposes rather than for the units that control them.

a)      All Mosques

b)      All Clubs

c)      Deposit Money Banks

d)     All Non Profit Organizations.

3) Households

A household is defined as a small group of persons who share the same living accommodation, pool some or all of their income and wealth, and consume certain types of goods and services (mainly housing and food) collectively. Unattached individuals are also considered households. Other groups, such as persons in monasteries, hospitals, asylums, prisons, and retirement homes, may constitute households if the inhabitants share resources and consumption for extended periods. Servants or other paid domestic employees who live on the premises but do not have claims on the collective resources are treated as separate households. Individuals who work in other countries are considered part of their home country households unless and until they establish centers of economic interest in foreign economies.

Households may engage in the production of goods and services for sale in the market, for consumption by the household itself, for construction of housing, and for accumulating other physical capital for the household’s own use. Unincorporated enterprises owned by households and engaged in market production are classified in the non-financial corporations sector if the enterprises can be treated as quasi-corporations. Otherwise, these unincorporated enterprises are classified in the household sector.

NEW PRODUCTS AND SERVICES OF NATIONAL BANK LIMITED

5.1 Major Functions of National Bank Limited

The products of corporate banking are discussed in the products and service part of NBL. So in this part only the names of the products are mentioned respectively. But those products are discussed here which wasn’t discuss yet.

 Corporate Banking

• Trade Finance
• Project Finance
• Offshore Banking
• Syndication
• Merchant Banking

NBL has been participating in capital market since long to generate more income. Besides investment in secondary market, Bank invested Tk.13.05 crore in primary portfolio during 2007. It helped the capital market remain vibrant. The purchase price of total quoted shares held by the bank on 31.12.2007 was Tk. 99.23 crore, market price of which was Tk. 229.55 crore on that day.

The bank earned Tk. 42.30 crore from share trading and received Tk. 4.21 crore as cash dividend during the year 2007. The bank also earned Tk. 25.07 lac from its market intermediary activities i.e. Banker to the issue, Underwriter, etc.

NBL purchased a membership of the Dhaka Stock Exchange Limited (member No. 203) and got registration as NBL Capital Services and became a corporate member of DSE.

Retail Banking

• SME
• Deposit
• Credit Products
• NRB Banking
• Micro Credit

5.2 Product or service offered by bank

• Retail Banking
• Deposit taking including special schemes.
• Remittance and collection
• Import and Export handling and financing
• Corporate Banking
• Loan syndication
• Project Finance
• Investment Banking
• Consumer Credit

Different Departments of National Bank Limited

• Accounts opening
• Deposit
• Local remittance
• Foreign remittance
• Clearance
• Credit
• Advance
• Accounts
• Cash
• Export Import Sector

Accounts Section

Accounts Department is called as the nerve Centre of the bank. In banking business, transactions are done every day and these transactions are to be recorded properly and systematically as the banks deal with the depositors’ money. . Improper recording of transactions will lead to the mismatch in the debit side and in the credit side. To avoid these mishaps, the bank provides a separate department; whose function is to check the mistakes in passing vouchers or wrong entries or fraud or forgery. This department is called as Accounts Department. If any discrepancy arises regarding any transaction this department report to the concerned department.

Besides these, the branch has to prepare some internal statements as well as some statutory statements, which are to be submitted to the Central Bank and the Head Office. This department prepares all these statements.

Account Opening procedure:

• An existing Current Account holder of the Bank.
• Officials of the Bank not below the rank of an Assistant officer.
• A respectable person of the locality well known to the Manager/Sub-Manager of the Branch concerned.

Step 2Receiving filled up application in bank’s prescribed form mentioning what type of account is desired to be openedStep 3

• The form is filled up by the applicant himself / herself
• Two copies of passport size photographs from individual are taken, in case of firms photographs of all partners are taken
• Applicants must submit required documents
• Application must sign specimen signature sheet and give mandate
• Introducer’s signature and accounts number – verified by legal officer

Step 4Authorized Officer accepts the applicationStep 5Minimum balance is deposited.Step 6Account is opened and a Cheque book and pay-in-slip book is given

5.3 NBL Products and Services

Deposit Products                 

1. 1.     Savings Deposit

National Bank Limited offers customers a hassle free and low charges savings account through the branches all over Bangladesh.

Benefits (Condition Apply)

• Interest rate of 6.00% on average monthly balance.
• Minimum balance Tk.1000.
• Maintenance charge yearly Tk. 400.
• No hidden costs.
• Standing Instruction Arrangement are available for operating account.

Account Opening

• 2 copies of recent photograph of account holder.
• Nominee’s Photograph.
• Valid photocopy of Voter ID Card.

2. Current Deposit

National Bank Limited offers customers current deposit facility for day-to-day business transaction without any restriction.

Benefits (Condition Apply)

• Minimum balance Tk.2000.
• Minimum maintenance charge yearly Tk. 800.
• No hidden costs.
• Standing Instruction Arrangement are available for operating account.
• Easy access to our other facilities.

Account Opening

• 2 copies of recent photograph of account holder.
• TIN certificate.
• Nominee’s Photograph.
• Valid photocopy of Voter ID Card.

1. 2.     Term Deposit

Short Term Deposit

National Bank Limited offers interest on customer’s short term savings and gives facility to withdraw money any time.

Benefits (Condition Apply)

• Minimum balance Tk. 2000.
• Minimum maintenance charge yearly Tk. 800.
• ·         Standing Instruction Arrangement are available for operating account.

Account Opening

• 2 copies of recent photograph of account holder.
• Nominee’s Photograph.
• Valid photocopy of Voter ID Card.

Fixed Deposit

National Bank Limited offers fixed term savings that will scale up your savings amount with the time.

Benefits (Condition Apply)

• Any amount can be deposited.
• Premature encashment facility is available.
• Overdraft facility available against term receipt.

Account Opening

• 1 copy of recent photograph of account holder.
• Nominee’s Photograph.

Foreign Currency Deposit

RFC Deposit

National Bank Limited gives opportunity to maintain foreign currency account through its authorized dealer branches. Bangladesh nationals residing abroad or foreign nationals residing abroad or Bangladesh and foreign firms operating in Bangladesh or abroad or Foreign missions and their expatriate employees.

Benefits (Condition Apply)

• No initial deposit is required to open the account.
• Interest will be offered 1.75% for US Dollar account, 3.00 % for EURO Account and 3.25% for GBP Account.
• They will get interest on daily product basis on the credit balance (minimum balance of US$ 1,000/- or GBP 500/- at least for 30 days) maintaining in the account.

Account Opening

• 2 copies of recent photograph of account holder.
• Nominee’s Photograph.
• Passport Copy.
• ID of residence in abroad.

NFC Deposit

National Bank Limited gives opportunity to maintain foreign currency account through its authorized dealer Branches. All non – resident Bangladeshi nationals and persons of Bangladesh origin including those having dual nationality and ordinarily residing abroad may maintain interest bearing NFCD Account.

Benefits (Condition Apply)

• NFCD Account can be opened for One month, Three months, Six months and One Year through US Dollar, Pound Starling, Japanese Yen and Euro.
• The initial minimum amount of $1000 or 500 Pound Starling or equivalent other designated currency.
• Interest is paid on the balance maintain in the Account. This interest is tax free in Bangladesh.

Account Opening

• 2 copies of recent photograph of account holder.
• Nominee’s Photograph.
• Passport Copy.
• ID of residence in abroad.

1. 3.     Monthly Saving Scheme

National Bank Limited offers monthly savings scheme for its retail customers.

Benefits (Condition Apply)

• Monthly amount can be 500 and multiple of it.
• Premature encashment is available for urgent need.
• Loan facility can be available up to 80% against NMS account balance.
• Standing instruction facility can be available to auto transfer installment to NMS account.

Account Opening

• 1 copy of your recent photograph.
• Nominee’s Photograph.

Credit Products

1. 1.     Overdraft

NBL offers overdraft facility for corporate customers for day-to day business operations.

Benefits (Condition Apply)

• Low charges in overdraft account maintenance.
• Facility is available against deposit receipt or mortgage property.
• Low interest rate 13-16%.

Account Opening

• Introductory current account.
• Others necessary documents as per loan requirement.

1. 2.     Lease Financing

National Bank Limited offers leasing facility for clients with easy installment facility.

Financing Area

• Capital machinery
• Different equipments
• Gas, Diesel generator and Power plant
• Medical equipments
• Lift or elevator
• Information Technology equipments
• Construction equipments
• Consumer durables

Benefits (Condition Apply)

• Competitive monthly rental
• Tax benefit
• Fast processing
• Easy handover after leasing period

1. 3.     Home loan

NBL offers home loan facility for purchasing flats or construction of house.

Benefits (Condition Apply)

• Financing amount extends up to 70% or Tk. 75, 00,000 which is highest of total construction cost.
• Grace period available up to 9 months in flat purchase or 12 months in construction.
• Competitive interest rate.
• No application or processing fee.

Eligibility

 Any Bangladeshi citizen or NRB, who is capable of repayment, can apply for this loan.

1. 4.     SME Loan

NBL offers financial support to small businessmen/enterprise with new products named “Festival Small Business Loan” and “NBL Small Business Loan” has been introduced in the Bank.

Benefits (Condition Apply)

• Maximum Tk.3.00 lac (Festival Scheme) and Maximum Tk.5.00 lac (Small Business Scheme).
• 3 Months (Festival Scheme) and 5 years (including 1 month grace period (Small Business Scheme))
• Collateral Free Advance.

Eligibility

Any genuine and small businessmen/ entrepreneurs/enterprise having honesty, sincerity, and integrity.

5.     Consumer Loan

NBL offers consumer credit facility for retail customers.

Financing items

• Electronics consumer products
• Computer or Computer accessories

Benefits (Condition Apply)

• Fast processing
• Competitive interest rate
• No application or processing fee
• Easy monthly installment

 6.     Trade Finance

NBL provides comprehensive banking services to all types of commercial concerns such as in the industrial sector for export-import purpose as working capital, packing credit, trade finance, issuance of Import L/Cs, advising and confirming Export L/Cs. – Bonds and Guarantees.

Benefits (Condition Apply)

• Low interest rate 13.00%-14.50%.
• Minimum processing time.
• Low service charges.

NBL Cards

• Credit Cards

NBL Credit Card is accepted in many merchant outlets around the country. Our wide range of merchants include hotels, restaurants, airlines, & travel agents, shopping malls and departmental stores, hospitals & diagnostic centers, jewelers, electronics & computer shops and many more.

Benefits (Condition Apply)

• 50% Cash withdrawal facility.
• No hidden costs.
• NBL Power Card

NBL Power Card is the first debit card for which you do not have to maintain any account with our any branch.

Benefits (Condition Apply)

• It is a Pre-paid Card.
• Annual / Renewal Free Tk. 200/- only.
• May be issued and refilled from RFCD/FC Account.
• Accepted at all VISA POS merchants.
• Cash withdrawal at all ATM booths bearing VISA and Q-cash logo (Except HSBC in Bangladesh).
• Drawing of Cash: (i) from NBL ATMs – Free of charges (ii) From ATMs under Q-cash network- Tk.10.00 per transaction (iii) From other ATM – Tk. 100.00 per transaction.
• Cash Withdrawal Fee (aboard)-2.00% on the cash drawn amount or US$2.00, whichever is higher.
• Only 1% loading fee against both International and Local Power Card at the time of Refilling.
• Yearly Tk.100 for enrollment of SMS service.

Account Opening

• 2 copies of your recent photograph.
• Nominee’s Photograph.

Western Union

Joining with the world’s largest money transfer service “Western Union”, NBL has introduced Bangladesh to the faster track of money remittance. Now money transfer between Bangladesh and any other part of the globe is safer and faster than ever before. This simple transfer system, being on line eliminates the complex process and makes it easy and convenient for both the sender and the receiver. Through NBL – Western Union Money Transfer Service, your money will reach its destination within a few minutes.

5.4 Description of various functional departments

Planning & Decision Making Process

Planning and decision making process control on the hierarchy of the management body. Each branch practice internal decision process decided by the ID of Head Office. Branch Manager, Officer 1& 2 holds the planning and decision process of an individual branch.

Organizing Techniques

Teamwork is the main focus of the organization, which is the bone technique of the bank. Each cycle is organized in a systemically way so it can be done any difficult job in a simple way.

Stuffing Pattern & Practice

A well-educated, skilled and enterprising workforce with wide experience in the banking is a precondition for the continued growth and progress of any bank. NBL’s aim is to recruit and retain a competent workforce. In the expectation of continued growth, the bank in 1987 established a training institute for its own staff at Shyamoli. National Bank recruits experienced bankers as well as fresh graduates and trains them through the Training institute. As on 31^st December 2008, its human resources strength was 2632. These numbers include 238 executives, 1446 officers and 562 staffs.

Leading Process

NBL leading process depends on chain of commend. It is the leading bank celebrating the jubilee in 2008. It is growing fast and also extends 5 more branches within this year.

Motivation Process

In reorganization to their contribution, the board has formulated a number of policies for the welfare of the employees. The board has introduced superannuating fund, gratuity, medical scheme, EHBL, car loan scheme, other benefits for executives/officers/stuff of the bank. The pay scale was also revised in 2006.

Career Planning & Development Scope

A well-educated, skilled and enterprising workforce with wide experience in the banking is a precondition for the continued growth and progress of any bank. NBL’s aim is to recruit and retain a competent workforce. In the expectation of continued growth, the bank in 1987 established a training institute for its own staff at Shyamoli. National Bank recruits experienced bankers as well as fresh graduates and trains them through the Training institute. As on 31^st December 2008, its human resources strength was 2632. These numbers include 238 executives, 1446 officers and 562 staffs.

Pay Structure & Benefits

Employees are the blood of the any organization. An institution cannot run properly without an efficient and effective management team. NBL management team has provided its efficiency by execution decisions and running the bank for the last 25 years. In reorganization to their contribution, the board has formulated a number of policies for the welfare of the employees. The board has introduced superannuating fund, gratuity, medical scheme, EHBL, car loan scheme, other benefits for executives/officers/stuff of the bank. The pay scale was also revised in 2006. In 2008, the board decided on AGM that 25% of increment on the pay structure of the banks employee overall which provide the major motivation to the employees.

Welfare & Facilities

In reorganization to employee’s contribution, the board has formulated a number of policies for the welfare of the employees. The board has introduced superannuating fund, gratuity, medical scheme, EHBL, car loan scheme, other benefits for executives/officers/stuff of the bank. The pay scale was also revised in 2006.

Disciplinary Action

Disciplinary action is taken within the custody of senior officer if any of employee/JO/PO/stuff make any occurrences or misbehaves he/she have to serve show cause of mislead, otherwise he/she would be fired from the job.

Controlling Methods

The has taken various steps for ensuring internal control and compliance as per directives and guidelines of Bangladesh Bank for maintaining core risks in banking with a view to conducting banking business effectively and efficiently. The internal control and compliance is supervised by the managing director and required steps for rectification and corrective measures are being taken immediately. The bank is now following the risk-based inspection as peer directives of the central bank.

Regular and routine inspection on 91 branches, surplus inspection on 7 branches and investigation on 12 cases were carried out in 2007. Apart from this Bangladesh Bank also conducted 41 inspections of bank’s branches and different division at Head Office of the bank. The key points of the inspection report are always placed before the Audit Committee of the Board of Director of the bank and actions are taken in accordance with its decision.

The management committee monitors the effectiveness of the internal control function periodically and provides certificate on overall adequacy and effectiveness of the internal control system to the board based on the banks policy, practice and procedure.

Environment, Politics & Practices

Quality of working life is easy, fast, durable, safe, furnished, updated. Environment of the workplace is fully AC, easy computerised equipment, on lining each branch, mobile network facilities etc. Politics & practice are unseen in working environment. Hygiene is maintained over there.

5.5 Industry Analysis

Banking sector is one of the strongest economic sectors in our country. Banks provide necessary funds for executing various programs underway in the process of economic development. They collect savings of large masses of people scattered throughout the country, which in the absence of banks would have remained idle and unproductive. These scattered amounts are collected, pooled together and made available to commerce and industry for meeting the requirements. Economy of Bangladesh is in the group of world’s most undeveloped economies.

One of the reasons may be its undeveloped banking system. Government as well as different international organizations have also identified that undeveloped banking system causes some obstacles to the process of economic development. So, one county must be efficient in banking if it wants to be developed.

5.6 Role of NBL in the Economic Development of Bangladesh

The PRSP (Poverty Reduction Strategy Paper) projected (Agriculture, Industry & Services) the GDP growth at 7.0% of FY 06 and maintain at or above 7.0% growth through FY 10 aided by improved microeconomic stability, overall agriculture sector growth, study growth in the manufacturing sector, competitive business environment and sustained improvement in the investment climate and ongoing implementation of economic reform programs. The domestic investment was projected to increase gradually from 26.2% of GDP in FY 08 to 27.4% in FY 09and 28.1% in FY 10 through mobilization of internal and foreign resources. Inflation is projected to decline from 6.5% in FY 08 to 5.0% in FY 10 by maintaining a contraction ally monetary policy.

5.7 SWOT Analysis

STRENGTHS

• NBL is the first commercial private bank in Bangladesh. It has been maintaining and serving its clients with goodwill over the years.
• A vast number of branches spread all over the country.
• Maintaining a strong network with different exchanges in different countries.
• Membership with Western Union.
• SWIFT service for faster transactions & communications.
• Customer satisfaction is a great concern.
• Foreign exchange division is well accommodated.
• Good provisions for training of the workforce.

WEAKNESSES

• Implementation of online banking is limited within some branches.
• Marketing & promotional activities should be set up properly.
• High skilled workforce is required.
• KYC (Know Your Customer) process is less possible to implement properly.
• Improvement in employee training program is necessary.
• Salary structure is a matter of concern.

OPPORTUNITIES

• Organizing seminar, workshop marketing on regular basis, can increase promotional activities.
• Can set up more correspondent relationship & branch network in potential areas.
• On line, E. Banking, ATM, Credit Card can be introduced fully on urgent basis.
• Foreign Exchange Business can be increased to a great extent.
• Strategies/policies to be adapted to matching the changing needs.
• Financing the most prospective garments sector in Bangladesh.
• Financing sick industries which have bright prospects.

THREATS

• Unstable political situation.
• Unhealthy and illegal competition among private sector commercial banks.
• Global Economy.
• Other bank use new technology which make a difference.
• Natural disaster.

FINDINGS

While doing internship on NBL some shortcomings come out to authors, which may create problem. These are:

• In foreign exchange department it is required to communicate with foreign banks and other international organization. To make the process easily NBL should have modern communication system such as e-mail, fax etc. and other equipments enough.
• Modern technology is hardly used to maintain documentation, yet they are using register-based document.
• Lack of manpower in Foreign Exchange Department. Number of employee of that section is rarely sufficient for prompt service.
• In order to provide faster service, full-scale online system should be implemented.
• Numbers of ATM booths have to be sufficient.
• Lack of available branches in remote areas of business and services.
• Lack of promotional initiatives to expand the Foreign Exchange business
• Marketing & promotional activities is ill set up.
• There are few packages to attract its customer.
• Internet service level is insufficient. Sometimes it creates problem to work at slow speed.

• Some employees are less trained to handling technology such as computer, Internet etc.

6.1 Recommendation

1. The entire department of National Bank Limited should be well informed regarding their goals and objectives. It is essential to execute company objectives into individual target.

1. There have Office Order for allocation of responsibilities authority and accountability but it should be more precise for individual level.

1. The bank should introduce more promotional activities at TV Channel as well media.

1. The bank should take the initiative to develop an effective research and development center to get innovative ideas to capture the competitive market.

1. Proper training should be designed and imparted for all level of employee to adjust complex banking environment.

1. Motijheel Branch should take necessary steps as soon as possible for doing foreign exchange business smoothly.

1. To meet today’s urge of the customer, the bank should introduce E – Banking system, Credit Card and Automated Teller Machine (ATM).

1. The bank has the provision of internship program but there is no organized structure for the internship program. The bank can properly utilize the internees at minimum cost.

1. The bank should go for advertising about their services and facility for the clients.  As a result banking activities will expand.

1. To attract more clients, National Bank has to offer more products & services compare to the others bank.

1. To observe the balance sheet of profit & loss A/C, we can say that National Bank has to increase some factors & reduces to the another factors compare to the front ranking Bank like operating income has to increase, operating expense has to reduces, retained earnings has to increases etc.

1. To attract more clients & hold the market National Bank has to create a new marketing strategy, which will increase the total export-import business.

1. More gaps are showing between perception & expectation of the respondents. As soon as possible the gap should be removed, which exist between clients & bank.

1. Establish own ATM network & maintain sufficient ATM booth.

1. Bank participate some social activities and it is to hope bank can increase this benefit to its clients and employee.

6.02 Conclusion

The research paper is all about the functions of accounting process and new products and services of National bank ltd. National Bank is the first private bank of Bangladesh. The existing products were successful to reach the consumer’s mind and as a result the number of NBL has increased day by day. The old customers were satisfied with the exiting products but day by day the numbers of consumers are increasing and with that the new generation is getting connected with NBL. Their demand is different from the ancient customers so for them NBL should think again and they should try to improve their service quality continuously.

In the project part it was found that the functions of accounting process reflect the overall activities of NBL and the new products are able to successful the current market demand and the research has taken place to ensure that the new products and services are improving the quality of NBL and attracting the new customers.

After the research, have got a clear idea about the functions of accounting process and overall products & services as well as the policies and procedures of the banking sector of Bangladesh. Comparing the other competitors of NBL it was originated that NBL is providing the quality service to their customers and their new products are adding value to their service. Their online banking service and ATM booth service is also appreciated by the consumers but the number of ATM booth can be one of the main obstacles for NBL to go ahead. So NBL should improve the quality of the products and they should increase the number of ATM booth allover the country only then NBL will be able to keep their current position as one of the leading private bank of Bangladesh.