My supervisor Faculty Md, Shariful Haque Lecturer in Marketing of International Islamic University Chittagong, Dhaka Campus assisted my placement in the Dhanmondi-2 Branch of Standard Chartered Bank (SCB) in Dhaka for my internship Program, which is a mandatory requirement of the Bachelor of Business Administration (BBA) program. After a certain time I was assigned by my supervisor, Md. Mominul Islam who is the Branch Sales and Service Manager (BSSM) of Dhanmondi-2 Branch, to work in customer services of consumer division. I was asked by my supervisor to prepare a report on ‘The products and services offered by Standard Chartered Bank and satisfaction level of customers in terms of its products and services.’0
1.2 Brief overview of the Company
Standard Chartered Bank is the leading multinational bank in this country. To maintain its leading position in the Bangladesh, Standard Chartered Bank is always keen to develop long-term beneficial relationship with trustworthy clients. To achieve this end, they have always upgraded their approaches to achieve profitability. The Standard Chartered Bank is an international banking and financial services group that is incorporated in the U.K. with its headquarters in London. It has a unique international network. It now spans in the developed and emerging economies of the world, after been built over 150 years.
Standard Chartered Bank’s operation is segmented under six regions: Europe, Middle East, South Asia, South East Asia, Australia and the USA. Globally, the SCB group owns a network of 600 offices in more than 50 countries with staff of about 28000 people. Globally, SCB specializes in personal, corporate, institutional and personal finance and custodial services. The bank excels in providing the most efficient, consistent and timely services and is the multinational bank in the Middle East, South Asia and North African regions.
1.3 Objective of the Study
A. Broad Objective:
The main objective of the report is to determine the competitive standing of Standard Chartered Bank in the banking sector in terms of its products and services, identify the major strengths of the banks customer service division, provide with probable solutions for the improvement of the customer service quality.
B .Specific Objective:
Here the broad objectives divided into specific objectives, which will help me to do the report efficiently and effectively.
Briefly observe the banking environment of Bangladesh and look at Standard Chartered Bank as an organization at some length.
To know about the overall banking activity.
Identify the major strengths of the SCB’s customer service division.
Identify the features of SCB’s services and discuss about product design and its target group.
Briefly discuss the frees and fees of its products and services.
Customer satisfaction with the service provided by consumer banking division.
Provide with probable solutions for the improvement of the customer service quality.
To identify the problem and weakness of the banking system of Standard Chartered Bank.
To suggest necessary measures for the development of the bank.
1.4 Scope of the Report
The scope of this report is limited to the overall descriptions of the bank, its services, its position in the industry, and its competitive advantage. The scope is also defined by the organizational set-up, functions, and performances. The beneficiaries of the report include the employees, the management, and customers of Standard Chartered Bank (SCB).
This study will help the employers to gain more knowledge about the satisfaction level of the customers and will help them to redefine their strategies to satisfy the customers. It will also help them to analyze more about their product.
Customers will also be benefited as sequence of new approaches taken by the employees to meet the requirements of the customers in product and service design.
This report will not only help the management of SCB, but also the stakeholders on a whole. Different financial institutions can be motivated to take an essence of this report in order to improve their different features of their products and ways of improving their customer services.
The report will be based on both primary and secondary research. The secondary research provided the main input for the report. This provided a theoretical basis of the report. For the organization part information has been collected through different published articles, journal, and brochures. Formal questionnaire for data collection will be use. At the same time information is collected through informal discussions with Relationship managers & respective Branch Manager as well PFC’s.
1.6 Source of Data Collection
The core information and data source is expected to be primary, because it will
involve interviewing officials of the Bank, observation and interview with customer. Secondary data related to the bank will be collected from different brochures of the bank, annual reports of the bank and from their websites.
A. Primary Source of Information:
Observation from the total internship period.
Discussion with officials of Standard Chartered Bank
Interviewing at the time of serving them in the branch banking
B. Secondary Sources of Data:
Relevant Standard Chartered Bank paper and published documents
Bank’s other published information.
Balance Sheets and Profit and Loss Accounts of Standard Chartered Bank.
1.7 Limitations of the Study:
Few limitations may appear in the report writing as every organization has some confidential data and research only based on Dhanmondi-2 Branch, which may not reflect the overall scenario.
Result that will appear after conducting this study may not reflect the same situation for all the other branches of SCB as this study is only based on the opinions of respondents of the SCB Dhanmondi-2 Branch.
Every organization has their own secrecy that in not revealed to others. This might be another problem for which the result can be manipulated.
2. BANKING SECTOR IN BANGLADESH
2.1 Overview of Banking
Whoever, being an individual firm, company or corporation generally deals in the business of money and credit is called bank. In our country, any institution, which accepts, for the purpose of lending or investment deposits of money from public, repayable on demand or otherwise, and with transferable by checks draft order and otherwise can be termed as a bank.
The purpose of banking is to ensure transfer of money from surplus unit to deficit units. Bank in all countries work as the as the repository of money. The owners look for safety and amount of interest for their deposits with Banks. Entrepreneurs try to obtain money from the banks as working capital and for long-term investment. These entrepreneurs welcome effective and forward-looking advice for investment. Banking sector thus owe a great to the deposit holders on the hand and the entrepreneurs on the other. They are expected to play the role of friend, philosopher, and guide for the deposit holders and the entrepreneurs.
Since liberation, Bangladesh passed through fragile phases of development in the banking sector. The nationalization of banks in the post liberation period was intended to safe the institutions and the interest of the depositors. Those handling the banking sector have borne the burden of putting banks on reliable footings. Despite all that was done, some elements of irregularities appeared. With the assertion of the role of the Central bank, The Bangladesh bank started adopting measures for putting banking institutions on right track. Yet the performance of public sector management of banks left some negative effects in the money market in particular and the economy in general. The agility among the borrowers manipulates the banking sector as a whole. In effect, a default culture appeared on the scene.
The opening of private and foreign participants to the banking sector was intended to obtain desirable results from banking. The authorization of private banks was designed to create competition among the banks and competition in the form of efficiency with and the productivity in enterprises funded by banks. Unfortunately, for the people, at large banking sector is yet to obtain the credit for efficiency, credibility, and growth.
The clever, among the user of banking services, have influenced the management of banks, for obtaining short-term and long-term loans. They sometimes showed inflated to get money for investment in business and industry. Few diverted their loan money to purposes different from the loan proposals, and invested in non-profitable units have failed to repay their loans to the banks. For this reason new entrepreneurs are not getting capital while defaulting entrepreneurs have started obtaining either relief in the form of rescheduling of the repayment program or additional inevitable money for diversified units.
2.2 The Banking Sector in Bangladesh:
Domestic banks can be divided into four main groups: Nationalized Commercial Banks (NCBs); Private banks established in the early 1980s; and private banks established in 1999:
2.2.1 Nationalized Commercial Banks (NCBs) In general terms; NCBs are large, operationally inefficient and technically insolvent. They are used as vehicles of government directed lending. These banks enjoy an enormous and stable customer deposit base, which provides a cheap source of funding. In addition, most large government related business is routed through these banks;
2.2.2 Private Banks, 1980s- set up to service the sectors not being addressed by the larger NCBs. Not subject to state directed lending but have generally suffered from related lending to directors and their extended families;
2.2.3 Private Banks, 1995 – six new licenses were granted. These are the better managed banks with strong capital base and good asset quality and under a much improved regulatory regime. All the banks clustered in this group have successfully raised capital from secondary market and all the shares are now traded in the stock exchange at premium.
2.2.4 New private sector banks. Ten new banks have been granted licenses over the year 1999. While some bankers complain that the country is over-banked, the more commonly held view, including that of the World Bank, is that there is adequate scope for these banks to survive given currently untapped gaps in the market, fat in existing interest margins (currently circa 5%), and efficiency/ service level disparities. It is estimated that up to 70% of the Bangladeshi economy remains un-banked. While this appears to imply that the newer banks may move downstream in terms of asset quality but in reality the last two sets of new banks are successfully competing with NCBs (Nationalized Commercial Banks) and foreign banks on the top end market segment.
Table 1: Banks in Bangladesh
|Name of Bank||Number of Branches|
|A. Nationalized Commercial Banks|
|1. Sonali Bank||1313||7|
|2. Janata Bank||897||4|
|3. Agrani Bank||978||—|
|B. Specialized Banks|
|1. Bangladesh Krishi Bank||836||—|
|2. Rajshahi Krishi Unnayan Bank||300||—|
|3. Bangladesh Shilpa Bank (Industrial)||15||—|
|4. Bangladesh Shilpa Sangstha||5||—|
|5. Grameen Bank||1110||—|
|C. Private Commercial Bank|
|1. Rupali Bank||515||1|
|2. Pubali Bank Ltd.||351||—|
|3. Uttara Bank Ltd.||198||—|
|4. Arab Bangladesh Bank Ltd.||58||1|
|5. International Finance & Investment & Commerce Bank Ltd. (IFIC)||55||2|
|6. Islamic Bank Bangladesh Ltd.||100||—|
|7. National Bank Ltd.||66||1|
|8. The City Bank Ltd.||80||—|
|9. United Commercial Bank Ltd.||79||—|
|10. Al – Baraka Bank Bangladesh Ltd.||33||—|
|11. Prime Bank Ltd.||16||—|
|12. Dhaka Bank Ltd.||9||—|
|13. Al-Arafa Islami Bank Ltd.||20||—|
|14. South East Bank Ltd.||10||—|
|15. BANK OF Small Industries & Commerce||21||—|
|16. Eastern Bank Ltd.||21||—|
|18. Social Investment Bank Ltd.||5||—|
|D. Foreign Commercial Banks.|
|1. American Express Bank Ltd.||2|
|2. Credit Agricole Indosuez||2|
|3. The Standard Chartered Bank||18|
|5. Habib Bank Ltd.||2|
|6. State Bank of India||1|
|7. Muslim Commercial Bank||2|
|8. Citi Bank NA||1|
|9. National Bank of Pakistan||1|
|10. Hanil Bank||1|
|11. Dutch Bangla Bank||2|
Clearly the banking industry is in a growing state and it will take years to clean up. The Government and BB have been working with the World Bank to introduce reforms, including related party lending, restricting lending concentrations to 15% of the capital base, capital adequacy and bankruptcy laws. The World Bank has indicated that there are funds available to assist individual banks improve their capital bases, but this depends on them first making full provision for NPLs. Some banks have also successfully raised capital through IPO’s (Initial Public Offerings). BB has reaffirmed its intention to continue extension of support to banks through rediscounting. However care should be exercised when taking comfort from BB’s (Bangladesh Bank) assertion that it will not allow any bank to fail. While this pledge has held true to date, in effect it means that BB will allow a technically insolvent bank to continue in operation with BB guidance and “technical” support but BB will not provide a capital injection or write-off government related bad loans.
3. ORGANIZATION PART
3.1 Organizational Overview
Standard Chartered Bank derives its name after two banks – Standard Bank of British South Africa and the chartered Bank of India, Australia and China. The merger took place in 1969. Standard Chartered Bank is regulated by the Bank of England and is a clearing bank in the United Kingdom.
The new millennium brought with it two of the largest acquisition in the history of the bank- the acquisition of the Grindlays Bank from the ANZ group for a consideration of $1.34 billion and acquisition of the Chase Consumer Banking Corporation in the Hong Kong for $ 1.32 billion. These acquisitions demonstrate Standard Chartered Bank’s firm commitment to the emerging markets.
Standard Chartered employs 29,000 people in over 500 offices in more than 50 countries. The group provides consumer-banking services to individuals and small to medium size businesses, and offers Wholesale Banking capabilities to corporate and institutional clients. With 150 years in the emerging markets the group has unmatched knowledge and understanding of its customers in its markets. Standard Chartered recognizes its responsibilities to its staff and to the communities in which it operates. Their 150 years of history gives them a deep better understanding of their markets, their customers, and the local communities in which they operate>It is a strong platform for future growth. Standard Chartered is holding leading positions in dynamic markets. They are in some of the world’s fastest growing markets including he United Arab Emirates, India, China, and the markets of South Asia. They are present in many of their markets for several generations and have become a trusted partner to businesses and individuals. In other words, they are trusted and well respected provider of financial products and services. They have built up an enviable knowledge of local markets in Asia, Africa, the Americans and the Middle East. In many cases, they have had a presence for more than a century. Their first two branches were in Calcutta and Shanghai and we have been operating continuously in China for the last 144 years.
3.2 Standard Chartered Bank — The History
Standard Chartered is the world’s leading emerging market’s bank headquartered in London. Its businesses however, have always been overwhelmingly international. Here is the summary of the main history of the Standard Chartered Bank.
3.2.1 The early years
Standard Chartered is named after two banks which merged in 1969. They were originally known as the Standard Bank of British South Africa and the Chartered Bank of India, Australia and China. Of the two banks, the Chartered Bank is the older having been founded in 1853 following the grant of a Royal Charter from Queen Victoria. The moving force behind the Chartered Bank was a Scot, James Wilson, who made his fortune in London making hats. James Wilson went on to start The Economist, still one of the world’s pre-eminent publications. Nine years later, in 1862, the Standard Bank was founded by a group of businessmen led by another Scot, John Paterson, who had immigrated to the Cape Province in South Africa and had become a successful merchant. Both banks were keen to capitalize on the huge expansion of trade between Europe, Asia and Africa and to reap the handsome profits to be made from financing that trade. The Chartered Bank opened its first branches in 1858 in Chennai and Mumbai. A branch opened in Shanghai that summer beginning Standard Chartered’s unbroken presence in China. The following year the Chartered Bank opened a branch in Hong Kong and an agency was opened in Singapore. In 1861 the Singapore agency was upgraded to a branch which helped provide finance for the rapidly developing rubber and tin industries in Malaysia. In 1862 the Chartered Bank was authorized to issue bank notes in Hong Kong.
3.2.2 Standard Chartered in the 1990s
Even within this period of apparent retrenchment Standard Chartered expanded its network, re-opening in Vietnam in 1990, Cambodia and Iran in 1992, Tanzania in 1993 and Myanmar in 1995. With the opening of branches in Macau and Taiwan in 1983 and 1985 plus a representative office in Laos (1996), Standard Chartered now has an office in every country in the Asia Pacific Region with the exception of North Korea. In 1998 Standard Chartered concluded the purchase of a controlling interest in Banco Exterior de Los Andes (Extebandes), an Andean Region bank involved primarily in trade finance. With this purchase Standard Chartered now offers full banking services in Colombia, Peru and Venezuela. In 1999, Standard Chartered acquired the global trade finance business of Union Bank of Switzerland. This acquisition makes Standard Chartered one of the leading clearers of dollar payments in the USA. Standard Chartered also opened a new subsidiary, Standard Chartered Nigeria Limited in Lagos, acquired 75 per cent of the equity of Nakornthon Bank, Thailand; and agreed terms to acquire 89 per cent of the share capital of Metropolitan Bank of the Lebanon.
3.2.3 Global presence of Standard Chartered Bank
Table 2: Standard Chartered Bank’s presence in total of 48 countries
|Africa||Asia Pacific||Latin America||Middle East & South Asia||UK & USA|
3.3 Standard Chartered in other Asia Pacific
The group has more than 80 branches and 14 offices in 14 countries across the region. In China, Standard Chartered has one of the largest branch networks of any foreign bank and is well positioned for growth and opportunities. The group is developing its Consumer Banking business and has opened branches in Shanghai and Shenzhen. In Thailand, the integration of Nakornthon Bank was successfully completed in 2002.The average number of employees in other Asia Pacific in 2002 is 4851.
3.3.1 Standard Chartered in India Region
Standard Chartered is the largest international bank in India and, following successful completion of the integration of Grindlays, have a combined customer base of 2.4 million in Consumer Banking and over 1200 corporate customers in Wholesale Banking. The group launched its business in Mauritius in 2002 to provide Wholesale Banking services to corporate client’s .The shared service centre in Chennai continues to develop rapidly as more services and processes are migrated from other countries. The average number of employees in the India region in 2002 was 5251.
3.4 The Acquisition of ANZ Grind lays by Standard Chartered
The main idea behind acquisition and merger is making an investment and usually involves more than mere cash. When two separate legal entities merge every organization aspect of both companies is expected to change be it internal or external. Such management decision is taken for a variety of reasons but the ultimate aim is to add up to shareholder’s wealth. For banks operating in the consumer and wholesale banking sector, earning depends largely on the interest margin as well as the service charges. For this increasing customer base is a major concern, for banks operating in foreign countries, increasing customer base is not easy since they have to compete with local banks which in many cases are backed by government. This especially true in Southeast Asia where governments have quite a strict control on the financial market and the institution
Figure 1: Global presence of Standard Chartered Bank
The government and autonomous banks largely dominate our country’s banking sector. Thus, competing them in interest figure becomes for both foreign and local and foreign banks. The only way to attract customer is through providing high quality service. Standard Chartered Bank, the largest and one of the oldest foreign banks in the country has been successfully doing business in corporate and consumer banking sector for years. It has introduced many new financial consumer and corporate products like money builder in the market. Recently the bank attracted a great deal of attention through it’s acquisition of another foreign bank operating in Bangladesh “ANZ Grindlays” from August 2001, the two competing banks will complete the merger process and operate from the same platform.
3.5 Business Activities of the Global Standard Chartered Bank
The bank provides a full range of products and services all around the world, some of which are mentioned here:
3.5.1Global Consumer Finance:
There are seventy-six branches and finance centers under this division in about the countries with a workforce of 1616 employees. Some of the services provided by these divisions are unsecured personal loans, credit cards and retail store cards, vehicle related leases, etc.
3.5.2 Personal Banking:
There are about 410 branches with a workforce of 12,000 employees working under this division in 28 countries. Some of the services provided by this division are various kinds of insurance and loans, account maintenance, traveler’s cheques and money exchange etc.
3.5.3 Global Corporate and Institutional Banking:
There are 350 branches under this division. This division provides services in 42 countries. The services provided by this division are International Trade Management, Institutional banking, Treasury, Custody and Cash Management.
3.5.4 Global Custodial Service:
There are 17 offices under this division and about 900 staff members, operating in 14 countries and headquartered in Singapore. Standard Chartered Equator fulfils standard Chartered Bank’s strategic commitment to provide custody and clearing services in the Greater Asia. Standard Chartered Bank has one of Asia’s leading custodians over 40 years. Equator’s focus is on the followings:
Commitment to equity
Dedication to the customer needs
Sustained investment in people and systems.
3.5.5 International Trade Management:
Principles services of this division are to the people are Import Letter of Credits (L/C), Import Bills for Collection, Back to Back Letter of Credit, Direct Export Bills for Collection, Bulk Letter of Credit Collection, Bonds and Guarantees.
3.5.6 Global Cash Management:
The division is operational in all countries where the group has Corporate & Institutional Banking division. Standard Chartered Bank recognizes the importance of Cash Management to corporate and institutional customers and offers a comprehensive range of services and liquidity management. Services provided worldwide by this division with stress on Asian delivery.
3.5.7 Global Institutional banking:
Throughout Standard Chartered Bank’s network of more than 600 offices in over 40 countries, it is very well positioned to provide a wide range of services to institutional clients: commercial, merchant & central banks; brokers and dealers; insurance companies; fund managers and others. Offices of emerging markets of Asia, Sub-Saharan, the Middle East and Latin America are complemented by the branches in the developed countries such as USA, UK and Japan and bank’s membership of the clearing systems in those countries. The Institutional banking group has a network of offices in 25 countries throughout Asia, North America, Europe, Africa and The Middle East.
3.6 Standard Chartered in Bangladesh
The Chartered Bank opened in Chittagong in 1948, which was, at that time, the eastern region of the newly created Pakistan. The branch was opened mainly to facilities the post-war re-establishment and expansion of South and South East Asia. The Bank opened its first branch in Dhaka in 1966 and shifted it’s headquarter from Chittagong to Dhaka after the birth of the Republic of Bangladesh in 1971.
At present the Bank has ten branches in Dhaka, it also have one offshore banking unit inside the Dhaka Export Processing Zone at Savar, one branch in Narayanganj, three branches in Chittagong, one branch in Khulna, one branch in Sylhet, one branch in Bogra. In the year 1999 Standard Chartered has acquired the operation of Grindlays Bank in the Middle East and South East Asian countries. Former Grindlays Bank started its journey in Bangladesh in 1905 under the name of Grindlays Bank (when it forbears the National Bank of India opened in Chittagong). Standard Chartered Bank took-over the operation of ANZ Grindlays Bank in Bangladesh as a part of acquisition of the South East Asian and Middle East operation of the Australia and New Zealand Banking Group. Standard Chartered Bank (SC) become the highest bidder quoting about AU$2.5 billion (US$1.5 billion) after ANZ Banking group decided to sell its subsidiary, the ANZ Grindlays Bank operating mostly in the Middle east and South East Asian countries. The SC with its 18 branches and booths across Bangladesh has employed more than 600 people. The acquisition has enabled Standard Chartered Bank (SC) to access 500,000 new customer and 40 branches in India, and this made them one of the biggest bank in this region.
After acquisition, Grindlays Bank is a part of Standard Chartered Group. The Bank presently has 18 outlets in 5 cities serving over 1,25000 customers. The network of SCB Bank in Bangladesh includes:
10 Branches in Dhaka city
1 Branch in Savar EPZ (Recently started with full banking operations)
1 Branch in Narayanganj
3 Branches in Chittagong
1 Branch in Khulna
1 Branch in Sylhet.
1 Branch in Bogra
Figure 2: Branches of Standard Chartered Bank in Bangladesh
Recently the bank opened a new branch in Bogra to reach out the in northern part of the country .The network of SCB engage itself for providing best quality banking service in retail, commercial and corporate banking segments. The countries top Enterprises; Multinational, Local Corporation and Financial institutions are served by SCB. With total asset based of BDT 17.5 billion and annual turnover of BDT 1.78 billion, SCB in Bangladesh is among the top performing multinational bank.
3.6.1 SCB’s Mission Statement
Motto: To be the world’s best international Bank by 2007.
Mission: Leading the way (Being proactive).
Standard Chartered Bank wants to be proactive in the sense that they want to exceed customers’ expectations, that is they want to come up with products and services having such features, before customers can start expecting them from SCB.
Vision/ Brand Promise: Being the right partner, being passionate about customers’ success and delighting them with quality service.
3.6.2 SCB’s Objectives
Based on their mission and vision, Standard Chartered has come up with few objectives, which they believe will help them reach their desired destination. They are:
Gaining a larger market share: Standard Chartered Bank currently has a quite low market share of less than 6%. They want to increase their market share in the coming years.
Strengthening brand image: SCB wants to establish them as a bank providing excellent service in the minds of the customers. This will help them strengthen their brand image.
Provide technologically advanced services: SCB want to provide technologically advanced services for the convenience of their customers. They were the first bank in the country to introduce Moneylink ATM cards. Now they have introduced Phone-banking, Internet banking and sms banking.
Making banking comfortable and convenient for customers: SCB wants to retain their customers by making customers feel comfortable while they are at the banking premises. For this reason they have arranged for adequate seating facilities. Now customers do not have to wait for long hours in queues, they can sit with their token until their token number appears on the screen and they are called to the counter.
Encourage and motivate customers so as to increase sales and profits: SCB wants to retain their previous customers by keeping them motivated by providing them with gifts for extensive use of ATM cards and Credit Cards and by providing higher interest rates to customers who open their accounts with a higher initial balance. This will also help them to attract new customers.
Ensuring customer satisfaction: Standard Chartered Bank has made use of different means of getting feedback from customers so as to understand their level of satisfaction, based on which they can take the necessary actions to ensure customer satisfaction.
3.6.3 SCB’s Strategies
Standard Chartered Bank has formulated some strategies to achieve their desired objectives. These strategies include:
Promotional activities: Standard Chartered Bank is trying to achieve their objective of increasing their market share by engaging in promotional activities. Example: They are offering free shopping worth Tk 2,000 from Agora to customers who will be able to refer at least 5 new customers to SCB.
Assigning targets to salespeople: The salespeople of Standard Chartered Bank are assigned targets based on their desired increase in market share. Salespeople are paid based on the number of sales they can make. If they are unable to achieve their target, they are not paid. This acts as a negative motivational factor that is a driving force for the salespeople.
Offering a very wide range of innovative products: Standard Chartered Bank wants to establish themselves as a strong brand name in the minds of customers. In order to achieve this objective they are continuously coming up with innovative products such as night banking, 24 hours ATM banking, 24 hours Phone banking, Internet banking, Sms banking, platinum credit cards having a maximum credit limit of BDT 1,000,000 and many more.
Introducing more convenient and comfortable means of banking: The innovative products offered by SCB have already made banking more convenient for customers. They have introduced token systems for customers who want to engage in cash and cheque transactions or want to make remittances. Customers no longer have to wait for long hours in the queue; they can sit making themselves comfortable and wait for their token number to appear on the screen before they go to the counter.
Providing free gifts to customer who make more use of SCB’s products and services: Standard Chartered Bank has made use of promotional strategies such as providing customers with free gifts like perfumes, electronic products and shopping vouchers based on their use of credit card services. For each 50 taka of credit, customers earn 1 point. They then can get free gifts based on the number of points they have made. They also offer free gifts to customers who make extensive use of ATM cards.
Introducing the concept of “Customer Loyalty Week”: SCB has introduced the concept of “Customer Loyalty Week”, a week when loyal customers are welcomed with pleasant gestures such as flowers or chocolates. They are also given the opportunity to express their opinions about the service quality of Standard Chartered Bank by writing them down and dropping them in the suggestion box. The management of Standard Chartered Bank then takes actions based on customers’ suggestions, to raise and restore customer satisfaction.
3.6.4 Management in SCB
Management in SCB consists of planning organizing, directing and controlling all of the resources of the organization. The goal of Standard Chartered Bank is to be the “Bankers of First Choice.” Towards that goal, the overall planning in the Organization is done at the headquarters level in Dhaka by a Management Committee (MANCO), headed by the CEO and consisting of the business heads of Corporate Banking, Consumer Banking, Treasury, and from the support divisions the heads of Human Resource, Operations and Finance Departments. They meet once a month, or when special situations arise, to plan the strategic decisions. The decision making, although apparently based on a top-down approach, leaves room for participation down to the level of department heads, which are responsible for carrying out the planning of their department within the broad guidelines set by MANCO. Management system of SCB is given below.
SCB now follows a top down planning approach. The top managers have the authority to decide how they will achieve their goal because SCB worldwide decides the goal. The Business Bank mainly does planning and Retail Bank Division, IT Department provides all the assistance and information that is required to create and execute long term and short term planning. Planning and IR Department provides all the assistance and IT and other infrastructure in order to reduce the paperwork IT has taken a plan to achieve the long term plan.
Each of SCB’s branches is being managed by one branch sales and service manager (BSSM). The performance of each branch is mainly dependent on the branch manager.
Management is partly authoritative and participant at the top level of SCB But every one has some assigned work to do for the day and they cannot deny this. Sitting arrangement is created in such a way that co-workers can sit close to each other and have sharing of their work and at the same time can have easy contact with each department coordinator/ Head. The work environment is very friendly. The room contains sufficient amount of light and is always kept cool by high capacity air conditioners.
SCB recruits people by two ways. One is a “Management Trainee” that has a probation period of six months and after the probation period the trainees will be counted as an officer and they will do the different kinds of managerial works and another is “Non-Management Trainee” which does not have any fixed probation period. Time required for training is dependent on the recruited person’s performance. In case of non-management trainee, two ways of recruitment is taking place. They are:
(a) Recruited by signing a contract with some outside organization for the three months and after three months the contract may be renewed or not depending on his/her performance. These people coming through outside contract are called “Outsource”.
(b) Recruited by signing a contract with the bank for the three months and after three months the contract may be renewed or not depending on his/her performance. These people coming through bank contract are called “In source”.
3.7 CUSTOMERS OF STANDARD CHARTERED BANK
SCB has allocated its operations in a way so as to satisfy the needs of two specific customer groups.
3.7.1 Non Institutional Customers
Consumer banking meets the needs of individual customers.
3.7.2 Institutional Customers
Corporate and institutional banking meets the needs of companies, banks and other financial institutions.
Companies Banks and other
Figure 3: Relationship between Respective Customers with Different Depts. of SCB
This focus allows the business to develop an in-depth understanding of the banks customer’s evolving requirements. This in turn enables them to develop the products and services that help SCB stand out from the competition. Treasury provides support to the customers of both these businesses and develops customers (both individual and institutional) of their own.
3.8 Product Division
There are different divisions for targeting different type of customers. Mainly consist of two divisions, that are Consumer Banking Division (C B) and other is Corporate Banking Division named Corporate and Institutional Banking (C & I).
• Consumer banking division meets the needs of individual customers with various products like Savings Account, Extra Value Savings Account, Access Account, Call Deposit, FCY Deposit, NFCD Fixed Deposits, RFCD Account, Personal Loans, Auto Loans, Flexi loans, Cash Line, Installment loans, etc. This department also deals with other savings instruments like education savings scheme, rainy day scheme, marriage day scheme, millionaire scheme (some printed brochures are enclosed in the Appendix)
• Corporate and institutional banking meets the needs of companies, banks and other financial institutions. Standard Chartered provides a full range deposit and loan products to its corporate clients. Rapid decision-making is an important feature of SCB’s services to international and domestic companies doing business in Bangladesh. All accounts are assigned to a Relationship Manager to look after client needs. Each relationship manager keeps close contact with the client obtaining in-depth knowledge of the client’s business and providing timely advice. This division’s products include network banking and borrowing services like working capital loan, long term loans, short term loans, margin account, commercial large loans, real estate apartment loans, heavy transport buying loans, real estate mortgage loans, construction loans, restaurant loans, and above all it includes all international trade related services like L/C issuing, L/C amendment, L/C Transfer, L/C Confirmation, Negotiation, Bank Guarantees, etc. These products are only served to the corporate clients of the bank, and those are mostly local corporate, large and local corporations, multinational national companies. List of some of them are given in the appendix section.
This focus allows the business to develop an in-depth understanding of the banks customer’s evolving requirements. This in turn enables SCB to develop the products and services that help them to stand out from the competition. Treasury provides support to the customers of both these business and develops customers (both individual and organizational) of its own.
3.9 The Division of SCB Bangladesh
The bank is divided into several divisions and business units, which are also further sub-divided. The divisions are mainly based on some service lines designed for and provided to targeted customers, other divisions and units are there to support the business activities of the major service based divisions. The following is the list of the divisions of SCB in Bangladesh. Note that the divisions are little different compared to the major areas of the Group.
3.10 Major Business Units
Standard Chartered Bank divides its business in different units like corporate banking, consumer banking, and priority banking etc. which are discussing below.
3.10.1 Corporate Banking Group
Standard Chartered Bank offers its local customers a wide variety of financial services. All the accounts of corporate clients, which mainly comprise the top local and multinational companies operating in Bangladesh, are assigned a Relationship Manager (RM) who maintains regular and close contact to cater to their needs. The objective of this department is to maintain a thorough knowledge of the client’s business and to develop positive relationships with them. This is maintained through interactions to offer timely advice in an increasingly competitive business environment. The expertise of the Financial Institution (former Institutional Banking) and Treasury groups is also available whenever required. The unique Off-shore Banking Unit (OBU) in Savar offers a full range of facilities to overseas investors, and recently that Savar Branch have expanded many of its activities. The Corporate Banking Group in Bangladesh has displayed a spirit of community involvement by working with NGOs to underwrite soft loans. Standard Chartered Bank offers its corporate customers:
The wide varieties of lending needs are offered with skilled and responsive attention.
Project finance and investment consultancy.
Bonds and Guarantees.
Local and International Treasury products.
The trade finance of Standard Chartered Bank takes care of the commercial activity related issues, particularly those related to import and export finance services. Some of the services are:
Trade finance facilities including counseling, confirming export L/Cs and issuing of import L/Cs, backed by its international branch and correspondent loan network Bond and Guarantees Project finance opportunities for import substitution and export oriented project
3.10.2 Treasury Division
The foreign exchange and money market operation of the Standard Chartered Bank in the world is extensive. Exotic currencies happen to be one of its special areas of strength. A 24 hour-service is provided to customers in Bangladesh through the Bank’s network of dealing centers placed in the principal of the world. The Bank’s treasury specializes in offering solutions to those who wish to manage interest rate and currency exposures that result from trade, investment and financing activities of other dynamic economies of the region. Treasury operations are developed in line with changing market conditions to provide the best services to its customers. According to BAFEDA (Bangladesh Foreign Exchange Dealers Association), Standard Chartered Bank presently controls 42% of the local foreign exchange market’s traded volume.
3.10.3 Financial Institution Department (Former Institutional Business Group)
Financial Institution Department (former Institutional Banking) is a specialized banking unit of Standard Chartered, providing products and services to the specific needs of other banks and financial institutions. It assists the local banks by taking care of their cross-border business through the worldwide Standard Chartered Bank networking over 40 countries. It offers various services like L/C Confirmation, Negotiation, Inter and intra Bank Guarantee, Local Bill Discounting, L/C Advising, L/C Transfer, L/C amendment advising, Reimbursement Undertaking and Authorities, Fund Transfers, Export proceeds, BDT Draft Drawing, International Payments (T T’s), Account Services (Vostro Account Management)
3.10.4 Consumer Banking Division
Superior retail banking services comprising a wide range of deposit and loan products are offered by the Standard Chartered Bank to its individual customers. The Consumer Banking division constantly faces challenges and meets them by developing new products and services to fulfill the specific requirements of local and foreign customers. Bank offers a 24-hour service in Bangladesh through its Moneylink ATM network and Phone-link Phone Banking services. The below mentioned type of accounts are served by the Consumer Banking Division.
Personal Current Account
Personal Savings Account
Personal Access Account
Consumer Fixed Deposit Account
Personal Call Deposit Account
Non-resident Foreign Currency Deposit Account
Resident Foreign Currency Deposit Account
Convertible Taka Account
Foreign Currency Accounts for Foreign Nationals
Foreign Currency Accounts for Bangladeshi Nationals
Private Non-Resident Taka Account
3.10.5 Card Division
Card is the latest area that has been identified for rapid development. The bank is the one of the acquirers of three major cards in Bangladesh. Two of the credit cards are VISA and MASTER CARD and the one is the charge card known as Japan Credit Bureau (JCB). Standard Chartered Bank is the subsidiary or secondary agent of the credit cards and a primary agent of JCB.
SCB started its cards operation in 1989 as a part of retail banking. Initially, SCB’s card market was very small, with only 30 merchants. But seeing the economies and the consumers’ attitude towards the credit card has given the opportunity to expand their market base by acquiring high quality merchants in the chosen segment. The bank is the first to introduce the TAKA CREDIT CARD. The card is issued basically to a person’s name and the specific person can use the card in anywhere in Bangladesh.
3.10.6 Custodial and Clearing Service
Headquartered in Singapore, Standard Chartered Bank fulfils the group’s strategic commitment to the provision of custodial service in Asia. Bank’s customers are primarily foreign global custodians and broker/dealers requiring cross border information as well as sub-custodian services. Standard Chartered Bank, Bangladesh is responsible for the planning in Bangladesh, but the overall management of the custody business is based on Bank international business strategy.
3.10.7 Information and Technology Department
This department is instrumental in the running of all the computerized operations of the bank. They help in the implementation and generation of computerized reports. Another major duty of the department is to maintain communication with the rest of the world.
Operation is part of the support division, which helps to run the businesses of the bank in a smooth and controlled manner. Since it helps mainly in processing the works of the business units, any mistakes made can be easily detected and on time. Following are the main functions of the operations department:
Central operations deals with the closing and opening of accounts and other payment and account related processing of the Personal Banking division
Treasury operations help to deal with the processing works of the treasury division. Loan Administration Unit (LAU) deals with the processing of the Corporate Banking division.
Operations also have a department that deals with internal projects that arises from the need to deal with certain problems or to make certain changes.
3.10.9 Legal and Compliance
In the UK, Standard Chartered Bank is regulated by the Bank of England, while in Bangladesh local banking laws regulate it and rules set by the Ministry of Finance and Bangladesh Bank. It also encourages its staff to conform to an internal culture of ethical behavior and sensitivities to the culture and religion of the country.
Some of the key areas that the Legal & Compliance department has to take care of are: any kind of legal issues, to advise the CEO regarding all matters and the management on legal and regulatory issues, correspond regulatory compliance issues to MESA Regional Head of Compliance, and supervise internal control (e.g. internal audit).
3.10.10 External Affairs
This department deals with advertising, public relations, promotions, partial marketing which involves disseminating new products and services to customers and above all ensuring service quality.
3.11 Human Resources Division
This department manages recruitment, training and career progression plan. Standard Chartered Bank highlights the importance of developing its people to create a culture of customer service, innovation, teamwork and professional excellence. SCB recruits people by two ways. One is a “Management Trainee” that has a probation period of six months and after the probation period the trainees will be counted as an officer and they will do the different kinds of managerial works and another is “Non Management Trainee” which does not have any fixed probation period. Time required for training is department on the recruited person’s performance. In case of non-management trainee, two ways of recruitment is taken place. They are (a) taken by signing a contract with some outside organization for three months and after three months the contract may be renewed or not depending upon the employee’s performance. These people coming through outside contract are called “Out Source”. (b) Taken by signing a contract with the bank for the three months and after three months the contract may be renewed or not depending on his/her performance. These people coming through bank contract are called “In source”.
3.11.1 Controlling Structure at SCB
Alike all other big multi-national companies, management in SCB consists of planning organizing, directing, controlling all of the resources of an organization. The goal of Standard Chartered Bank is to be the “Bankers of First Choice.” Towards that goal, the overall planning in the Organization is done at the headquarters level in Dhaka by a Management Committee (MANCO), headed by the CEO and consisting of the business heads like Corporate Banking, Consumer Banking, Treasury, Global Markets, and from the support divisions the heads of Human Resource, Operations and Finance Departments. They meet once a month, or when special situations arise, to plan the strategic decisions. The decision making, although apparently based on a top-down approach, leaves room for participation down to the level of department heads, which are responsible for carrying out the planning of their department within the broad guidelines set by MANCOM.
Among the broad strategic objectives are:
Creating a congenial work environment
Modernization of the management information system to achieve full automation by drastically cutting down the paper works in long term.
Focusing on service quality and consume needs
Recruiting and maintaining top grade, efficient employees
To invest in those technological systems which will upgrade and enhance financial services
Creating an excellent brand image of the bank.
3.11.2 Personnel Policies:
The number of officers exceeds the number of clerk, which is a straight contrast to local banks specially the nationalized commercial banks. Standard Chartered Bank pays great attention to recruiting high quality staff through proper evaluation and improving their skills through structured training. Reward and punishment base on strict performance evaluation and opportunities of promotion both in country and abroad are two important features of the personnel policy of Standard Chartered Bank.
3.11.3 Recruiting, Training and Career Progression:
The recruitment process is based on references, advertisements and internships. Entry point screening is done both by the written and oral test. The medical record of the potential employee is very important and those suffering from potentially life threatening and performance deterring diseases are not hired, even if they were otherwise qualified. The placement of the staff is done in two ways. Either the employee undergoes a management trainee program with a probation period of nine months and is categorized as an officer leading to various managerial jobs, or is recruited at a non-management level as banking assistance or support officer. There is a structured training framework for all the employees, and a channel for moving people from national to international positions. International graduate recruitment and personal skill development for entry-level employees are a part of the human resources development efforts at Standard Chartered Bank.
3.11.4 Five Values of Standard Chartered Bank
Standard Chartered Bank has five values and these values are key to their success. These values determine how the employees achieve their goals, the way they work together and how it feels to be a part of Standard Chartered Bank. In brief these values are:
1. Courageous: Being courageous is about confidently doing what’s right. Often the task may seem insurmountable but with courage and tenacity, the odds can be overcome. A truly courageous act both inspires and builds character.
2. Responsive: How we response to our customer will influence their belief in our commitment to them. A proactive response is often unexpected and more effective for that. It clearly demonstrates our willingness to go beyond the unexpected.
3. International: As a member of global village we view the world from the widest perspective. We are all global citizens and the world is full of new opportunities and exciting possibilities. We also deliver world-class products and services.
4. Creative: Creativity belongs to those of us who are excited by challenges and engage them in fresh thinking and an open mind. Creative thinkers are not limited by convention but allow their minds to soar beyond predictable solutions.
5. Trustworthy: Trust is the foundation of every successful relationship. We trust because we believe in the sincerity of our promise. Building trust can take forever. Losing takes only moments.
3.11.5 Chain of Command:
Standard Chartered Bank in Bangladesh follows a hierarchy pattern of command. The chief Executive Officer (CEO) for the country reports to the Regional Manager, MESA (Middle East South Asia) in Dubai. All other departmental Heads at the headquarters report to the CEO. A manager or Senior Manager reports to the divisional heads. The respective Branch Managers or Branch Sales and Service Managers (BSSM) are responsible for the performance of their unit. Each branch is organized functionally along line divisions with some support facilities and the manager assigns tasks to his / her subordinate personnel and supervises their performance.
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