54827773 Internship Report AB Bank

7/28/2019 54827773 Internship Report AB Bank

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Internship Report

On

General Banking & MarketingStrategies of Financial Products

Of

Submitted To

Syeda Rownak AfzaSenior LecturerBBS, BRAC University.

Submitted By

Rezwan Bin MostafaStudent ID: 06104020.BBS Department,BRAC University.

Date Of Submission

6th June, 2010.

RAC University

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Preface

This report is concerned to be a brief study of the operation, function, tasks and services ofAB Bank Ltd. Banking plays an important role in the commercial and economic developmentof a country. Now- a- days banks are using different modern technologies, whichinfluencethe managerial activities, thats why I decided to do my internship training in the bank. Inpreparation of this report I have tried my best to provide all possible informat


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ion about theoperation, function and tasks of ABBL in brief and comprehensive form. It also includes abrief description of different departments where I have worked during my internship. I have

also tried my best to use simple and easy words and language.

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Letter of transmittal

Syeda Rownak AfzaSenior LecturerBRAC Bussiness SchoolBRAC University.

Subject: Submission of Internship report.

Madam,

This report on Marketing Strategies Of Financial Products & Customer Services ofABBank Ltd. is prepared to fulfill the requirement of the Internship program of B.B.A degree.

This report focuses on the different marketing strategies used by AB Bank Ltd. to promotetheir products and how they provide customer services.

I am grateful to you that you give me the opportunity to do this report, which was veyinteresting. I have enjoyed preparing the report though it was challenging to fi

nis within thegiven time and limited access. I tried my best to compile the information for this reportcomprehensive as possible.

Thanking you

Rezwan Bin MostafaID- 06104020BRAC Bussiness SchoolBRAC University.

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AAAcknowcknowcknowllledgemedgemedgemententent


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First of all, I would like to thank almoghty Allah for his grace in accomplishing myinternship report timely.

I would like to express my gratitude to my academic supervisor Syeda Rownak Afzafromthe core of my heart for her kind support, guidance, constructive, supervision,insstructionsand advice and for motivating me to do this report.

I am also thankful to HR Division of AB Bank Limited for giving me the opportunity toconduct the internship in Principal Branch of AB Bank Limited. I would like to thankMr.Suruz Ali Vutto (SAVP) operation manager of Principal Branch AB Bank Limited.

I am also grateful to Mr. Ashfaq (Principal Officer) who helped me a lot to complete myinternship report by providing data about the financial product of AB Bank.

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Executive Summary

The study is about the General operations and Management of AB Bank Ltd. which focuseson different types of customer services that are offered by AB Bank and their differentfinancial product with different marketing strategies. The objective of the study is to identifythe strategies AB Bank uses to market their products. At the same time the paperfocuses togain an understanding on issues that are important for developing marketing stra

tegies forfinancial services.

AB Bank Limited, the first private sector Bank under Joint Venture with Dubai BankLimited, UAE incorporated in Bangladesh on 31st December 1981 and started its operationwith effect from April 12, 1982.

Dubai Bank Limited (name subsequently changed to Union Bank of the Middleast Limited)decided to off load their investment in AB Bank Limited with a view to concentrate their

activities in the UAE in early part of 1987 and in terms of Articles 23A and 23Bof thearticles os Association of the company and with the necessary approval of the relevantauthorities, the shares held by them in the Bank were sold and transferred to Group AShareholders, i.e. Bangladeshi Sponsor Shareholders.

AB Bank limited was incorporated in Bangladesh on 31st December 1981 as ArabBangladesh Bank Limited and started it operation with effect from April 12, 1982


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. AB BankLimited is now fully owned by the Bangladeshis. Since their inception in 1982, they havebeen participating in different industrial and national development activities in addition tonormal Trade Finance and SME development. In addition to the 73 branches withinthecountry ABBL has a branch in Mumbai, India. Beside that they have the wholly ownedFinance company in Hong Kong in the name and style of AB International Finance Limitedand representative offices at London and Yangon.

AB Bank commits to nation to take a lead in the banking sector through not onlystrongfinancial positions, but also through innovation of products and services. It also ensurescreating higher value for its respected customers and shareholders. The bank hasfocused tobring services at the doorstep of its customers and to bring millions into banking channelsthose who are outside the mainstream banking arena. Innovative products and services wereintroduced in the field of SME, Consumer Loans, Debit & Credit card (Local &

International), ATMs, Internet Banking, Remittance services, Treasury products and

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services, Structured Finance for Corporate, strengthening and expanding its Islamic Bankingactivities, Investment Banking, specialized products and services for NRBs ,PriorityBanking and Customer Care. The bank has successfully completed its automation project inmid 2008. It envisages enabling customers to get banking services within the com

fort of theirhomes and offices.

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Table of Contents

Contents Page NoChapter 1 1-5

1.0 Introduction of the report 11.1 Background of the study 11.2 Purpose of the study 21.3 Nature of the study 21.4 Scope of the study 31.5 Methodology of the study 31.6 Limitations 41.7 Literature review 4 5Chapter 2 6 202.0 Background of ABBL6


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2.1 Mission Statement82.2 Vision Statement82.3 Change of Name82.4 Corporate information of ABBL92.5 Values92.6 Objective of ABBL102.7 Historical review of ABBL112.8 Current profile of ABBL132.9 Management Aspect152.9.1 Executive Committee162.9.2 Audit Committee162.9.3 Management Committee162.10 Management Hierarchy of ABBL172.11 Functional Hierarchy192.12 General Banking 20Chapter 3My Job Part22 26Chapter 44.0 Introduction of the Department27 -3627

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4.1 ABBL Principle Branch274.2 Current Savings Department274.3 Accounts Department284.4 Credit Department314.5 Remittance Department344.6 Cash Department364.7 Clearing Department 36Chapter 538 - 565.0 Financial product385.1 Retail Banking385.2 Corporate Banking45

5.3 SME Banking465.4 NRB Banking495.5 Islamic Banking515.6 Investment Banking525.7 New Product555.7.1 Ogrim Munafa Patra555.7.2 Be a Millionaire in 3 years555.7.3 Troimashik Munafa Hishab 56Chapter 657 - 606.0 Marketing Strategies adopted by ABBL576.1 Understanding Consumer576.2 Identifying & Targeting Financial Prospects576.3 Product Differentiation Strategies58

6.4 Channels of Distributions596.5 Pricing of Financial Products596.6 Corporate Social Responsibility 59Chapter 77.0 Customer Services offered of ABBL7.1 Credit Card61 - 666161


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7.2 Safe Deposit Locker7.3 New MICR Cheque Book7.4 AB Bank VISA Electron Debit Card626464Chapter 867 - 708.0 Customer Relation Management678.1 Customer Retention678.2 Promotional Activities68-708.3 Branding Image 70Chapter 971 - 769.0 Performance of ABBL719.1 Financial Performance739.2 Operating Performance749.3 Online Banking 75Chapter 1010.0 Findings of the Report10.1 Recommendation & Conclusion77 - 7977

78Bibliography. 80

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Chapter 1

1.0 Introduction of the report

1.1 Background of the Study

The financial service sector in Bangladesh is now quite competitive to deal with

changingenvironment. A number of external forces have exerted influence on the sector, includingsocio-economic, regulatory and technological factors. Changes to regulatory environmentundoubtedly have had the greatest impact on this sector. Technology has also increasedimportance for financial institution especially for private commerce banks.

There are now 30 private commercial banks operating in Bangladesh and they are offeringdifferent products and services but there are few basic differences among them in terms of

structure and performance. Thus the competitions among them are increasing day by day andmarketing of financial products is now becoming an important concern.

The report is a reflection on my experience when I was an internee in ABBL, PrincipalBranch, Dhaka. Since its inception in 1982, ABBL has maintained a steady growthover thepast twenty eight years span of its operations.


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The study is critical in nature. It was conducted to investigate critically intothe operations ofAB Bank Ltd and it also explains that how ABBL provides facility of online banking to itscustomers. The annual reports or the consolidation data of the Bank has not beenfocused inspecific because it does not reflect the operational performance of branches. However , theyhave been referred to as when and where required.

1.2 Purpose of the Study

General purpose

To get acquaintance with the general operations of ABBL.To know about different types of financial products offered by ABBL.To have a clear idea about the marketing strategies adopted by ABBL for differen

ttype of financial productsSpecific purpose

Specific purpose of the study includes

To objectively observe the operations of AB Bank Ltd in general and theoperations of ABBL, Principal Branch, Dhaka in specific.

To know about their bases for consumer segmentation.

To know about their product differentiation strategy.

1.3 Nature of the StudyFrom this study it is evident that, the research that has been conducted is exploratory innature.

Exploratory research provides insights into and comprehension of an issue or situation. Itshould draw definitive conclusions only with the extreme caution. Exploratory research is atype of research conducted because a problem has not been clearly defined. Exploratory

research helps determine the best research design, data collection method and selection ofsubjects. Given its fundamental natural, exploratory research often concludes that a perceivedproblem does not actually exist.

1.4 Scope of the Study

The study covers two areas with its variables, which affects the operation of the branch


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directly or indirectly. These two areas of variables are

.Branch specific variable.

.Bank specific variable.

The branch specific variables are the variables under the control of the branchmanagementand directly affect its operations e.g.

.Layout of the branch..Customers relations..Departments in the branch..ATM Online banking.

The bank specific variables are those variables, which are not in control of thebranchmanagement e.g.

.History of ABBL..Services provided by ABBL..Role of ABBL.

1.5 Methodology of the ReportData SourcesBoth primary and secondary data have been used in the completion of this report.Themethodology used is as under:

.During the completion of this report, I relied mainly on the primary data. The toolsused for the collection of primary data are interviews and observation. To get primarydata I also performed some practical work.

.The secondary data was mainly used for as a background material and for purposeofreference. The major sources of secondary data were the annual report 2008 & 2009,


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other printed material of the Bank and internet played a vital role as a sourceofsecondary data.

1.6 Limitations

The study was subject to the following limitations the absence of which could have made thisreport more accurate, systematic and factual.

.Lack of published marketing information.

.Lack of back hand information with stuff.

.Lack of access to data.

1.7 Literature Review

The private commercial banks, operating in Bangladesh, constantly focus on understandingand anticipating customer needs. They already made significant progress within a

very shortperiod of their existence. Many of the banks have been graded as top class banksin thecountry through internationally accepted CAMEL rating.

The CAMEL model is based on the Uruguayan farmers model. Participants who have aninterest for a particular topic and who wish to learn mor5e by sharing knowledge, practicesand ideas agree to hold a series of study visits. They take it in turn to organize and host a visitto their organizations. The even consist of:

Presentations by managers, practitioners and partners outlining strategies andpractices.Discussions around the presentations, as follow- up to inter-visit communications,generally on key themes and suggestions and ideas for future practice.Demonstration of tools or systems.

Hands on sessions to enable actual experience.Review and evaluation of the practices discussed, the day itself and suggestionsforthemes of future visits and inter visits communications.Most of the have already occupied enviable positions among their competitors after achievingsuccess in all areas of business operations. Banking scenario undergoes changestime to timeas this very dynamic industry. Private commercial banks are offering different f


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inancialproducts with different features. They follow various strategies to market suchproducts.

This paper focus on marketing strategies of financial products of ABBL. First ofall it isimportant to know what marketing strategy is and what the financial products that AB bankusually offers are.

A marketing strategy can be defined as the outlines of broad marketing logic bywhich thebusiness units hopes to achieve its marketing objectives and the specific of target markets,positioning and marketing expenditure levels. It is a process that can allow organizations toconcentrate its limited resources on the greatest opportunities to increase sales and achieve asustainable competitive advantage. A marketing strategy should be centered on the keyconcept that customer satisfaction is the main goal.

Financial products refer to those instruments that to those instruments that help you save,

invest, get insurance or get a mortgage. These are issued by various banks, financialinstitutions, stock brokerages, insurance providers, credit and agencies and governmentsponsored entities. Financial products are categorized in terms of their type orunderlyingasset class,volatility. Risk and return.

Understating customer and customers needs and requirements is the guiding philosophy ofmarketing. A marketing orientation requires the organization to view of its customers. AB isrecognized as the peoples choice, catering to the satisfaction of its cliental. T

heir satisfactionis ABs success.

Chapter -2

2.0 Background of AB Bank LTD.

AB Bank Limited, the first private sector bank under Joint Venture with Dubai Bank Limited,UAE incorporated in Bangladesh on 31st December 1981 and started its operation with effect

from April 12, 1982.

Dubai Bank Limited (name subsequently changed to Union Bank of the Middleast Limited)decided to off-load their investment in AB Bank Limited with a view to concentrate theiractivities in the UAE in early part of 1987 and in terms of Articles 23A and 23Bof the


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Articles of Association of the Company and with the necessary approval of the relevantauthorities, the shares held by them in the Bank were sold and transferred to Group "A"Shareholders, i.e. Bangladeshi Sponsor Shareholders (ABBL 2010).

As of December 31, 2007; the Authorized Capital and the Equity (Paid up CapitalandReserve) of the Bank are BDT 2000 million and BDT 4511.59 million respectively.Authorized Capital of the Bank has been increased to BDT 3000 million in the ExtraOrdinary General Meeting held on July 16, 2008.

Since beginning, the bank acquired confidence and trust of the public and business houses byrendering high quality services in different areas of banking operations, professionalcompetence and employment of the state of art technology.

During the last 28 years, AB Bank Limited has opened 77 Branches in different BusinessCenters of the country, one foreign Branch in Mumbai, India and also established

a whollyowned Subsidiary Finance Company in Hong Kong in the name of AB International FinanceLimited (ABBL 2010). To facilitate cross border trade and payment related services, theBank has correspondent relationship with over 220 international banks of reputeacross 58countries of the World.

AB Bank Limited, the premier sector bank of the country is making headway with amark ofsustainable growth. The overall performance indicates mark of improvement with Deposit

reaching BDT 53375.35 million, which is precisely 26.85% higher than the preceding year.On the Advance side, the Bank has been able to achieve 30.76% increase, therebyraising atotal portfolio to BDT 40915.35 million, which places the Bank in the top tier of privatesector commercial banks of the country. On account of Foreign Trade, the Bank made asignificant headway in respect of import, export and inflow of foreign exchangeremittancesfrom abroad.

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AB Bank is known as one of the leading bank of the country since its commencement 28years ago. It continues to remain updated with the latest products and services,consideringconsumer and client perspectives. AB Bank has thus been able to keep their consumers andclients trust while upholding their reliability, across time. In spite of adversemarket


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condition, AB Bank Limited which turned 28 this year, concluded the 2009 financial yearwith good results. The Banks consolidate profit after taxes amounted to taka 230coreswhich is 21% higher than that of 2008. The asset base of AB grew by 32% from 2008 tostand at over Tk 8,400 cores as at the end of 2008.

The Bank showed strong growth in loans and deposits. Deposit of the Bank rose byTk 1518core i.e, 28.45% while the diversified loan portfolio grew by over 30% during the year andrecorded a Tk 1579 cores increase. Foreign Trade Business handled was Tk 9,898 coresindicating a growth of over 40% 2009.

The Bank maintained its sound credit rating in 2009 to that of the previous year. The creditRating Agency of Bangladesh Limited (CRAB) awarded the Bank an A1 rating in thelongterm and ST-2 rating in the short term.

The bank decided to change its traditional color and logo to bring about a freshapproach in

the financial world, an approach, which like its new logo is based on bonding, and trust. Thebank has developed its logo considering the contemporary time. The new logo represents ourcultural Sheetal Pati as it reflects the bonding with its clientele and fulfillingtheir everyneed. Thus the new spirit of AB is Bonding. The logo of the bank is primarily red aredrepresents velocity of speed and purity. Its new logo innovates, bonding of affiliates thatgenerate changes considering its customer demand. AB Bank launched the new logoon its25th anniversary year.

AB Bank has continuously invests into its biggest asset, the human resources todrive forwardwith its mission to be the performing in the country. The bank has introduced foritsemployees. Male employees wear designed ties and females wear share or salwar kamiz, allthe dresses are consisted with the unique AB Bank logo.

AB is recognized as the peoples choice, catering to the satis faction of its cliental. Their satisfaction is ABS success

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2.1 Mission Statement:"To be the best performing bank in the country"2.2 Vision Statement:"To be the trendsetter for innovative banking with excellence & perfection"2.3 Change of Name:Arab Bangladesh Bank Limited changed its name to AB Bank Limited (ABBL) with effect


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from 14 November 2007 Vide Bangladesh Bank MRPD Circular Letter No-10 dated 22November 2007. Prior to those Shareholders of the Bank approved the change of name in theExtra Ordinary General Meeting held on 04 September 2007 (ABBL 2010).

New Logo of ABBL

Effective 01 January 2008, ABBL changed its Logo as well.

2.4 Corporate Information of AB Bank Limited:Name of the CompanyAB Bank LtdLegal Form: A public limited company incorporated on 31st December, 1981 under theCompanies Act, 1913 and listed in the Dhaka Stock Exchange Ltd and Chittagong StockExchange Ltd.Commencement of Business27th February 1982

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Registered Office

BCIC Bhaban, 30-31, Dilkusha C/ADhaka 1000, Bangladesh.Tel: +88-02-9560312Fax: +88-02-9564122, 23SWIFT: ABBLBDDHE-mail: [email protected]

Web: www.abbank.com.bd

2.5 Values:.Service Excellence

.Openness

.Trust

.Commitment

.Integrity

.Responsible corporate citizen

AB Bank Limited see their customers trust as the lifeline of their business, control andcompliance as license to operate, dynamic and motivated people as their strengthto multiplyand technology as their weapon to service excellence.

2.6 Objectives of AB Bank Limited:


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Maximization of profit along with the benefits of employees is the main objective of thebank. In addition, the order objectives are:

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.Bringing modern Banking facility to the doorstep of general public throughdiversification of banking services, thereby arousing saving propensity among thepeople.

.Foreign a cordial, deep-rooted and firm banker-customer relationship by dispensingprompt and improved clients service..Taking part in the development if the national economy through productivedeployment of the Banks resources as well as patronizing different social activities.

.Connecting clients to modern banking practice by the best application of improve

dinformation technology, so that they get encouraged to continue and feel proud ofbanking with ABBL.

.Ensuring highest use of the professional workforce through enhancement of theiraptitude and competency.

.Responding to the need of the time by participating in syndicated large loan financingwith likeminded Banks of the country, thereby expanding the area of investment of

the Bank.

.Elevating the image of the Bank at home and abroad by sustained expansion of itsactivities.

.Ensuring maintenance of capital adequacy, comfortable liquidity, asset quality andhighest through successful implementation of the management core risk program(ABBL 2010).

2.7 Historical Review of AB Bank Limited:AB Bank Limited (ABBL) a joint collaboration bank with Dubai Bank Limited. It wasformed in Dhaka on 31 December 1981. It started banking operations on 12 April 1982 as ascheduled private sector commercial bank. Initially the authorized capital of the bank was Tk200 million divided into 2 million shares of Tk 100 each. The issued and paid upcapital wasTk 80 million. The authorized capital of the bank has later been enhanced to Tk


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800 million.The paid up capital was also enhanced at different times of its operation and stood at Tk

409.94 million in December 2000. ABBL is the first Arabian-Bangladeshi joint ventureprivate commercial bank in Bangladesh and was formed with the assistance and support ofthe Dubai-based Galadari family, a group active in international trade, financeand industry(ABBL 2010).5

Nine numbers of boards of directors including the chairman governs the overall affairs of thebank. The chief executive of the bank is its managing director. In all, 1,472 employees,including the executives and officers, work in the bank in various capacities. The bank has 62branches (urban-46, rural-15 and overseas-1). The Head Office of the bank is located atDilkusha, Dhaka.

ABBL was set up to conduct all types of traditional commercial banking functionsincludingforeign exchange business and other financial services. It has been able to achievesatisfactory progress in all areas of its planned activities including deposit mobilization,credit expansion, servicing imports and exports, remittance services, investment, and productinnovation.

At the end of 1982, the first year of the banking business, the total deposits of ABBLamounted to Tk. 136.71 million. This stood at Tk. 16,217.5 million on 31 Decembe

r 2000.The deposit-mix of the bank in 2000 was composed of fixed deposits (56.6%), savingsdeposits (21.84%), and current and other deposits (21.56%). The amount of totalreservefunds of ABBL was Tk. 354.81 million in 2000 as against Tk. 202.48 million in 1995.

Total loans and advances of ABBL increased from Tk 116.96 million in 1982 to Tk12,548.4million in 2000. Responding to the needs of the market, ABBL introduced three newschemes: Student Loan, Personal Computer Loan for Educational Institutions (for

theirlaboratories), and Monthly Interest Payment Facility to term deposit holders. The broadeconomic areas in which the bank lends (and the total outstanding amount of advances tothose areas in million Taka) up to 31 March 2000 were: agriculture and fisheries(278),industry (2,811), retail/wholesale trade and hotels and restaurants (3,769),transport/communication and storage (180), insurance, real estate and trade service (1,384),


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special credit programmers, including poverty alleviation and income generatingactivity(520), and others (1,874). Up to 31 March 2000, ABBL provided financial supportin theform of loans and advances to 88 large and medium scale and 145 small and cottageindustrial projects amounting to Tk. 2,300 million. It has also extended projectfinancing in

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syndication with other banks. The ratio of advances and deposits during the year1999 and2000 were 80.66% and 77.38% respectively (ABBL 2010).

In 2000, the bank's total classified loans were 23.45% of its total loans and advances. Itmaintained a provision of Tk. 1,435.4 million for them, which affected the bank'sperformance and degraded the quality of its lending assets. The quantum of investment of thebank rose to Tk. 2,429.66 million in 2000 from Tk. 23 million in 1982. Of the total

investment in 2000, 93% was in government treasury bills. The rest was investedin othersectors including debentures of ICB, ordinary shares of companies and prize bonds. In thatyear, the bank earned an income of Tk. 170.21 million from its investments.

In the financial year ending on 30 June 2000, total foreign exchange business ofthe bank wasTk. 11,600 million, which included imports (34.48%), exports (58.19%) and remittances(7.33%). ABBL has foreign correspondent relationships with 221 banks/bank offices andother financial institutions at different international financial centers. The o

verseas operationsof the bank are conducted through its Mumbai branch in India and its subsidiarycompany,the AB International Finance Limited in Hong Kong. The bank has two foreign representativeoffices - one in London and the other in Yangon.

As of December 31, 2006; the Authorized Capital and the Equity (Paid up CapitalandReserve) of the Bank are BDT 2000 million and BDT 2582.76 million respectively.TheSponsor-Shareholders hold 50% of the Share Capital; the General Public Shareholders hold

49.43% and the rest 0.57% Shares are held by the Government of the People's Republic ofBangladesh (Annual Report 2008). However, no individual sponsor share holder ofAB Bankholds more than 10% of its total shares.

During the last 27 years, AB Bank Limited has opened 74 Branches in different BusinessCenters of the country, one foreign Branch in Mumbai, India, two RepresentativeOffices in


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London and Yangon, Myanmar respectively and also established a wholly owned SubsidiaryFinance Company in Hong Kong in the name of AB International Finance Limited. To

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facilitate cross border trade and payment related services, the Bank has correspondentrelationship with over 220 international banks of repute across 58 countries ofthe world.

2.8 Current Profile of AB Bank Limited:Since beginning, the bank acquired confidence and trust of the public and business houses byrendering high quality services in different areas of banking operations, professionalcompetence and employment of the state of art technology (Annual report 2008).

At present, the bank has 74 branches throughout the country with about 18000 employees.The existing Board of director is 14. M. Wahidul Haque is the chairman of boardand Kaiser

A. Chowdhury is the President and Managing Director. The bank has been restructured theirfive main business which are responsible for earning the revenues of the bank. These are:.Corporate Banking

.Consumer Banking

.SME Banking

.Treasury and

.Cards

All other department of the bank acts as support for these units and helps themin everypossible way. Under this arrangement, the responsibilities and functions of those brancheshave been reduced dramatically. Many of the activities like credit evaluation and approval,

monitoring of loans, trade services activities etc. are now centralized in the Head Office. Thebranches of the bank are now termed as the sales and service Centers which are solelyconcentrated on delivering services to the corporate and consumer clients and maintainrelationship with them.

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AB Bank Limited, the premier sector bank of the country is making headway with amark ofsustainable growth. The overall performance indicates mark of improvement with Depositreaching BDT 42076.99 million, which is precisely 53.78% higher than the preceding year.On the Advance side, the Bank has been able to achieve 46.32% increase, therebyraising atotal portfolio to BDT 31289.25 million, which places the Bank in the top tier of privatesector commercial banks of the country (Annual report 2008).

On account of Foreign Trade, the Bank made a significant headway in respect of import,export and inflow of foreign exchange remittances from abroad.

Since beginning, the bank acquired confidence and trust of the public and business houses byrendering high quality services in different areas of banking operations, professionalcompetence and employment of the state of art technology (Annual report 2008).

At present, the bank has 74 branches throughout the country with about 18000 emp

loyees.The existing Board of director is 14. M. Wahidul Haque is the chairman of boardand Kaiser

A. Chowdhury is the President and Managing Director. The bank has been restructured theirfive main business which are responsible for earning the revenues of the bank. These are:.Corporate Banking

.Consumer Banking

.SME Banking

.Treasury and

.Cards

All other department of the bank acts as support for these units and helps themin everypossible way. Under this arrangement, the responsibilities and functions of thos

e brancheshave been reduced dramatically. Many of the activities like credit evaluation and approval,monitoring of loans, trade services activities etc. are now centralized in the Head Office. Thebranches of the bank are now termed as the sales and service Centers which are solelyconcentrated on delivering services to the corporate and consumer clients and maintainrelationship with them.


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AB Bank Limited, the premier sector bank of the country is making headway with amark ofsustainable growth. The overall performance indicates mark of improvement with Depositreaching BDT 42076.99 million, which is precisely 53.78% higher than the preceding year.On the Advance side, the Bank has been able to achieve 46.32% increase, therebyraising atotal portfolio to BDT 31289.25 million, which places the Bank in the top tier of privatesector commercial banks of the country (Annual report 2008).

On account of Foreign Trade, the Bank made a significant headway in respect of import,export and inflow of foreign exchange remittances from abroad.

2.9 Management Aspects:The AB Bank Limited Management Team comprises of a group of people and each themcomes with an international working background and is committed in leveraging th

eirexperience to take ABBL to greater heights by ensuring top line revenues with dynamiccapabilities. This Management Team is unique in being able to envision the needof thebusiness by bringing in admixture of advanced technology solutions know-how andrevamping the organizational make-up for maximum profitability. Other than the Presidentand Managing Director, the remaining Management Team Members each lead a functionalDepartment.

This mix of people is persistent to provide unparallel services to its customers

, come up withtimely and innovative products and services and to enhance the capabilities of its people of itspeople while emphasizing on the latest technology. This they believe will take the bank to aforemost position in the country by the turn of the year 2008. This team is to drive thebusiness to maximize the operational excellence and efficiency through acquisition of talent,developing systems, processes and people and through blending of these to let customersrevel in with fulfillment and permanency (Annual report 2008).

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Like any other business organization, all the major decisions in ABBL are made by the topmanagement committee. The board mainly establishes the objectives and policies of the bank.There are three committees of the board for different purpose.

2.9.1 Executive Committee:


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This committee is comprised of Chairman, four members of the bank and one membersecretary. The functional and responsibilities of this committee is to establishandperiodically review the banks overall credit and lending policies and procedures,development and implement uniform and minimum acceptable credit standards for the bank,new credit proposal assessment and approval etc.

2.9.2 Audit Committee:The main objective of this committee is to assist Board of Directors with regardto the auditof financial reports, management reports by the external auditors, internal controls andinternal audits. ABBL have four members in audit committee.

2.9.3 Management Committee:The main objective of this committee is to ensure business operations are in line with theBanks policies, strategies and objectives, the bank has set up. This committee consists of theManaging Director, Deputy Managing Director and different business unit heads (ABBL

2010). The honorable members are:

2.10 Management Hierarchy of AB Bank Limited:5ChairmanBoard of Directors

Management DirectorDeputy Managing Director

Senior Executive Vice President

Senior Assistant Vice PresidentAssistant Vice PresidentSenior Principal OfficerSenior OfficerExecutive Vice PresidentSenior Vice PresidentVice PresidentPrincipal OfficerManagement Trainee (Entry Level)Officer

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Trainee Officer (Entry Level)Contractual Officer (Entry LevelTrainee Officer (Entry Level)Contractual Officer (Entry Level2.11 Functional HierarchyThe functional hierarchy represents the reporting order in the hierarchy of ABBL


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. Thehierarchy has president and directors at top management level and officer Grade1, 2 andGrade 3 at the lower level management of ABBL. The middle level management consists ofregional general Manager and Regional controller of operations. These positionsare notfixed. Any person of the hierarchy above the branch manager can be appointed asRGM andController Operations.

5President and CEORegional GeneralManagerof Office G-1, 2 and other lower staff

2.12 General BankingFinancial institution that mediates or stands between ultimate borrowers and ultimate lendersis known as banking financial institution. Banks perform this function in two ways takingdeposits from various areas in different forms and lending that accumulated amou

nt of moneyto the potential investors in other different forms.

General banking is the starting point of all the banking operations. General bankingdepartment aids in taking deposits and simultaneously provides some ancillariesservices. Itprovides those customers who come frequently and those customers who come on time inbanking for enjoying ancillary services. In some general banking activities, there is no

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relation between banker and customer who will take only one service from bank. One theother hand, there are some customers with who banks are doing it business frequently. It isthe department, which provides day to day services to the customers. Every day it receivesdeposits from the customers and meets their demand for cash by honoring cheques.It opensnew accounts, demit funds, issue bank drafts and pay orders etc. Since bank is confined toprovide the service everyday general banking is also known as retail banking.

General Banking consists of the many sections in the branch. These are

.Customer service.

.Account opening / closing.


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.Remittance

.Payment Order issue..Demand Draft issue / collection..T.T issue/ collection.Endorsement.IBC / OBC Collection.

. Deposit Department

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.Locker Service.

.Accounts Department.

.Clearing

.Transfer.

.Cash.5

Chapter- 3

My Job Part

I did my internship in accounts opening department of Principal branch of AB BANKLIMITED. Its a nice department for learning different types of banking material likedifferent types of account, their requirement, and their benefit to the customers, about thecheque books and I also have to handle the customers who usually come to open account, togive cheque book requisition, receive the cheque books and who come to update theirinformation in the customer database, scanning customer signature card.. It had

been a greatexperience to do my internship in such a important department of Principal branch of ABBANK Limited. I have found some study when I did my internship in accounts openingdepartment. Mainly I have to do these task in my internship period, they are

.Opening account


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.Giving requisition for cheque books.

.Receiving cheque books arrange them and give it to the right person.

.Scan the signature card.

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.Updating legacy accounts.

.Customer service.

Opening Account: Opening account is the core job responsibility for account openingdepartment. People have different purpose for open an account. Some people wantsto opensavings account, some wants to open current account and some wants to open FC orforeign

currency account. Different types of account needs different types of papers. Now I willdescribe about different types of account that AB bank offers

1.The Bank offers the following types of accounts to its various types of customers:i) Current Accountii) Savings Bank Accountiii) Special Notice Time Deposit (STD)iv) Fc (Foreign Currency) Account.Current Account:

This type of account is opened by both individuals and business concerns includingnon-profit making organizations. New current account must be opened with a chequeonly but there must be some initial cash deposit. Opening of current account requiresproper introduction. Frequent transactions (both deposits and withdrawals) areallowed in this type of account. A current account holder can draw cheques on hisaccount for any amount and for any number of limos in a day as the balance availablein the account permits. No interest is allowed on current account. A minimum balance

as prescribed by the Head office must always be maintained for this type of account.Current account holders have pay taka 1500 per year as a charge. Statement ofaccount is to be dispatched to the account holder on monthly basis or as may berequested by the customer, through a forwarding memo as per prescribed formatretaining an office copy for reference. This type of account need some papers foropening a current account like if it is opened by person then he or she has to submit


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Short Term Deposits (S.T.D.):

Short term deposits account is one type of current account. Withdrawals from thistype of account require a prior notice varying from 7 to 29 days and 30 days ormore.Interest on S.T.D should be paid as per instruction issued by Head Office from time totime.

Based on demand and supply of funds in the money market, but in no case interestshould be allowed exceeding the prescribed rates applicable for Fixed Deposit ofdifferent tenor, without obtaining prior approval of Head Office. The differencebetween the face value of the Certification of Deposits and the prepared interest willbe received by the Bank from the purchaser of BCDs at the time of issue. The Bankwill not ask any question, not even the depositors name. No record will be kept i

n theBank other than the amount, certificate number, rate of interest, date of sale and dateof encashment. The certificate is transferable by delivery alone and does into requireany endorsement. Premature encashment of BCD is not permissible. No credit facilityshould also allowed against the security of Bearer Certificate of Deposits

Foreign currency Account or FC account: FC account or foreign currency accountmainly opened by the people who are working in foreign country. They have to select theirnominee who is permitted to run the account instead of him or her. For opening a

FC accountcustomers have to submit their work permit license, trade license if they have and thephotocopy of their passport, photocopy of national identity card and also the photocopy ofpassport and national ID card of nominee. Fc account cannot be joint. It has tobe a singleaccount holders name. Customers have to deposite 500 us doller for open a fc account in ABBank Limited

After getting the information from customers from I had to put it on the systeman after

getting all the information system delivers the account number of the customer.Then Ihad to fill a form which is known as KYC (Know Your Customer) form and approve theaccount from the operation manager.

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Giving requisition for cheque books: Bangladesh Bank has declared to give MICR c


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5

Chapter -44.0Introduction of The Departments4.1ABBL Principal BranchChapter -44.0Introduction of The Departments4.1ABBL Principal Branchor required papers we filled the KYC (Know Your Customer) form of those accountholders.Then I putted the new information in the database of customers and filled it properly.

Customer service: I also had to give some customer service like giving balance,helpedthem to fill up the account opening form, helped them to understand why their account isclosed, provided the information about the rate of interest and charge of different accounts.

(Branch Code -4005)

I did my internship of twelve weeks in ABBL Prince Branch (4005) from 01-03-2010to 3005-10. This is called the main branch of AB Bank. This is also the biggest branch of ABBank Ltd.

So I got much opportunity to learn different banking activities by doing my internship in thePrincipal Branch of AB bank Ltd.

4.2 Current Saving Department5

In ABBL Principal Branch current saving departments mainly deals with cheques, vouchersand advices. First of all a cheque holder have to present his / her cheque to the personresponsible for issuing the tokens. Then cheque is passed on to the operator toentry it incomputer. Afterward it will go far signature verification after which it will begiven to cashierfor payment.

Computer Operations

In ABBL Principal Branch al the operations are recorded in the computer that areas under;

1. Daily TransactionsTo record all the transactions of deposits made by the people and also to recordall thewithdrawals made by the people or customers. Each transaction has to be the recorded in itsappropriate head of account with the help of described codes.


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2. VouchersTo record all the vouchers made by the remittance department. Remittance department haveto prepare debit and credit vouchers for about every transaction recorded in their department.Then these vouchers are recorded in the computer.

3. AdvicesTo record all advices received from other branches most of the inter branch or intra branchremittances are subject to ultimate receipt of advices from the corresponding branch tomaterialize the transaction. These advices also have to be recorded in computer.

4. StatementsTo close the daily record a number of statements have to be the printed out. Like

.Everydays transaction (sequence )

.Overdrawn facilitated a/c.

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.Statements markup sheet.

.Inter branch transactions.

.Detail of PLS and current a/c

.Days transaction ( a/c wise)

.Operative, Dormant, Inoperative and Unclaimed a/c

.Summary of al a/c ( debits, credits & balances)

.Profit due, transferred, disbursed etc.

4.3 Account Department

Deposits are the Life Blood of A bank. Borrowing funds from outside parties is moreimportant because the entire banking system is based on it. Receiving of deposits is basicfunction of all commercial banks. Commercial banks do not receive these depositsforsafekeeping purpose only. When the bank receives the amount of depositors as a depositor, itbecomes the owner of it. The bank may therefore use deposits, as it deems appropriate. But


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there is an implicit agreement that the amount owned by the bank will be paid back to thedepositors on demand or after a specified period of time. The borrowed capital of the bank isthan the bank of own capital. Banks borrowing is mostly in the form of deposits.Thesedeposits are lend-out to different parties larger the difference between the rate at which thesedeposits are borrowed and the rate at which they lend out. The greater rate willbe the profitmargin of the bank. Larger the funds lend out the greater will be the return earn on them andgreater the amount of return on these earned greater will be the profit of the bank. It isbecause of this interrelated relationship. Deposits are referred to as the life blood small forany banking sector.

Types of Account

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.

General Products are :

Current deposit:

Interest Rate 0.00%

Individual Account Joint Account Proprietor ship Account.Savings Deposit:

Interest Rate 6.00%

Individual Account Joint AccountShort Term Deposit:

Interest Rate 5.00%

Limited Company Account. Proprietorship Account. Limited Company Account.Fixed deposits:

Fixed deposit is one, which is repayable after the expiry of a pre determined pe

riod fixed byhim. The period varies from 1 month to 12 months. These deposits are not repayable ondemand but they are withdrawing able subject to period of notice. Hence, it is popularly

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known as Time Deposit or Time Liabilities. Normally the money on a fixed deposit is


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Thesources of repayments should be clear and definite.

.Purpose Principals: The purpose of the advances should be legitimate and productive.It should be ensured that the banks, funds are not being utilized for speculativebusiness. The credit restrictions by the central bank should not be violated & it shouldbe ensured also. It is always beneficial for the bank to finance for short timerequirements.

.Profitability Principals: The end result of every business activity should be toearnsome profit. Similarly the bank must get some profit out of the activity of lendingmoney. So that the depositors could get their shares as well as the shareholderscouldearn something from their investment.

.Security Principal: The proposal should be dealt on its merit not on security. T

hesecurity should be considered a safety for the bank only in case of unexpected

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emergencies. All the relevant documents of securities must be obtained & gotvaluation of the property or any other security should be assessed correctly.

.Spreading of Risk Principals: It is always safe for the bank to spread the riskin largenumber of borrower instead of loaning huge amount to few big shots. It is better

toobtain different types of securities instead of concentrating on one security.

.National Interest and Suitability Principal: It is our moral as well as legal obligation toensure that no loaning is running counter to national interest. It is our duty to ensurethat our lending policies are not against the social conditions or bindings.

Functions of Credit Department

The main function of the credit department is to lend money to the customer. AB

Bank Ltd.Lends money in the form of clean advances against promissory notes as well as securedadvances against tangible and marketable securities. Beside these ABBL also lendmoneyagainst life policies and immovable property.

LIEN

Lien is the bank right to with hold property until the claim on the party is pai


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d. The banklooks at their liens as protection against loss or overdraft or any other creditfacility. Inordinary lien the borrower remains the owner of the property, but the actual orconstructivepossession remains with the creditor or bank though the borrower has no right tosell it.

.By Cash Credit: In this the bank lends money to the borrower against tangible security.The total amount of loan is not paid in one installment. The borrower has to paythemarkup on the amount borrowed. Cash credit is favorite loan for large commercialandindustrial concern.

.By Overdraft: This is the most common type of bank lending. When a borrower requirestemporary accommodation, ABBL allows its customer to withdraw an excess of thebalance from their account which is borrowing customers have in credit and thuscalledoverdraft. This facility is given to regular, reliable and well established cust

omer. When it

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is against collateral securities, it is called Secured Overdraft & when borrowingcustomer can not get the offer of any collateral security except his or her personal securitythen the accommodation is called Clean Overdraft

Types of Finance.

Short Term Finance

AB Bank Ltd. receives the saving of the people and lends it for short term to itscustomer. Short term finance is generally given for a period of one year or lessinduration.

.Medium Term Finance

The duration range of the intermediary term finance is from one year to three years. It

is called the term loan. Intermediary term finance is usually given for the expansion ofan existing business or for the purchase of new equipments.

.Long Term Finance

This type of finance is required for the period of more than five years. Long termfinance is generally given for the compilation of big projects, for the construc


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tion ofbusiness and for the purchase of machineries.

Procedure of Applying For Loan

Any customer who applies for loan should have an account (usually current account) withABBL branch concerned. That account must be in running position. When approval from

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head office is given, branch gives term & condition to the party. Bank does notadvance100% loan against a security, rather the profit margin is different in differenttypes of loan.

4.5 Remittance DepartmentAnother important department in ABBL is Remittance department. The remittancesdepartment transfers the funds from one bank to another bank and from one placeto anotherplace.

In remittance department the collection take place. ABBL made payment of only opencheques on the counter and prohibits the payment of cross cheques. ABBL transfers moneyfrom one place to another by the following means:

.Mail Transfer

When a customer requests the bank to transfer his money from this bank to any otherbank or the branch of the same other bank, the first he has to do is to fill anapplication form. If the customer is not the account holder of this bank, then f

irstly hehas to deposit the money and then above procedure will be adopted to transfer hismoney. Different banks and different branches give mail to transfer the money.

.Telegraphic Transfer

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With the changing requirement of the customer, ABBL has introduced the fastesttransfer of money. The sender is required to apply through a form in which he wi

llgive all the necessary details about the sender and beneficiary. The sender deposits themoney to be transferred plus bank charges at the bank counter. The remittancesofficials send a telegram to concerned branch with a specified code words and thereceiving branch makes payment to the beneficiary. Vouchers are sent by ordinarymail to keep the record. On TT, no excuse duty is charged only commission andtelegram charges are charged.


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.Pay Order

Pay order is the most convenient simple and secure way of transfer money. It isissuedby, drawn upon and payable by the same branch of the bank. It is neither transferablenor negotiable and such as it is payable to the payee named there in. The followingare the parties to a pay order:

.Purchase is a person, firm, company or local authority.

.Issuing/ paying branch is one which issues/pays on presentation.

.Payee is a person named there in.

.Demand Draft

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Demand draft is another way of transfer money from one bank to another bank.Unlike pay order, a form is required to be filled for the issuance of the demanddraftin which necessary particulars about the beneficiary and sender are given. The senderdeposits the amount of DD plus commission and other charges on the bank counter,from where he is given a receipt and accordance with this receipt he is issued.

The following are the main essential of the draft:

.It is a negotiable instrument..Filling a form and depositing the amount written about on it..It is a written order to its branches or to another bank to pay the stated amount

on draft.

4.6 Cash Department

This is the most important and critical department in a bank. There are two basic functionsperformed by the cash department. These are

.Receipts

An individual who has account in the bank can deposit money in his account. Fordeposit ofthe money the individual has to fill the deposit slip in which the account holde


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r writes his

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name, account number, amount of money both in figures and in words. After filling thedeposit slip the cash amount along with the deposit slip is submitted to the cashier. Thecashier collects the cash and counts it after verification the cashier stamps the deposit slip.One part of the deposit slip remains with the bank for the record purposes. Thecashier alsorecord the deposits made by the customer in credit sheets daily. The deposits ofall customerof the bank are controlled by mean of ledger account and has separate ledger cards in whichhis /her total record is kept. Bill collection is also one of the main functionsof bank. Cashierhas to prepare a list of bills serial number, a copy of which is to be sent to the correspondingorganization.

.

Payments

The procedure of clearance of a cheque or payments is as following. First of allthe customerpresents his cheque to the cashier. The cashier records the account number and the amount,which is to be drawn. Then the cashier check the cheque number in the computer for theverification whether the account has such amount is his account which he is demanding ornot. If the computer passes the cheque, the passing officer signs the cheque andsent it to thecash counter then the cashier pays the written amount to the customer and then i

n the endcashier records the amount paid in computer.

4.7 Clearing DepartmentIn clearing process, if the account holder of ABBL receives the cheque of otherbank likeCity Bank, Prime Bank etc and he submits it in ABBL branch then it needs to be cashed. Atthe same time the clearing process starts. When the cheque is cleared then the today stamp isrequired. Some cheque is drawn on ABBL. This is called outward clearing. These chequewill be entered in the outward clearing register and the advices is sent for the

clearance ofcheques. Then account holder account is credited.

OUTWARD BILL FOR COLLECTION

OBC means the cheque of other banks. When they sent OBC the OBC is credited & the OBRis debited and the advice is made on that time, one copy is remain in the bank and the othercopy is sent to the related branch. When they realized the opposite entry is mad


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exceed BDT 10,00,000.00Charges Application Fee : TK 500.00Processing Fee: 1% on the approved loanamount or TK 5000.00 whichever is higher.Tenor For Recondition Car: Max 36 monthsFor Brand new car: Months.Rate of Interest 14.50% p.a-17.50p.aProduct Name Auto LoanTarget customer Employees of reputed Local Corporate, MNCS,NGOS, Airlines, Private Universities Schoolsand Colleges, International Aid Agencies andUN bodies, Government Employees, SelfEmployed professionals ( Doctors, Engineers,Chartered Accountants, Architects,Businessman.Purpose To purchase Brand new vehicle, non registeredreconditioned vehicle.Loan Amount 70% for the brand new car60% for the reconditioned car but must notexceed BDT 10,00,000.00Charges Application Fee : TK 500.00Processing Fee: 1% on the approved loanamount or TK 5000.00 whichever is higher.Tenor For Recondition Car: Max 36 months

For Brand new car: Months.Rate of Interest 14.50% p.a-17.50p.aLoan AmountMinimum TK 25,000.00

Maximum TK 5,00,000.00Charges Application fee Tk 500.00

Processing fee: 1% on the approved loan amount or

TK 2000.00 whichever is higher.Tenor Min 12 months

Max 36 monthsRate of Interest 14.50% p.a-17.50% p.a

SecurityHypothecation of the product to be purchased. Twopersonal guarantees ( as per our list of eligibleguarantors)

5Security Hypothecation of the vehicle to be purchased.Two personal guarantees (as per list of eligibleguarantors)

Product NameEasy Loan ( For Executives)

Target Customer The loan is specially designed for salariedpeople who are employed in different reputedcompanies.Purpose


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Marriages in the family, purchase of officeequipments/ accessories, purchase ofmiscellaneous household appliances, purchaseof personal computers, purchase of audio- video

equipment, purchase of furniture, advance rentalpayment, trips abroad, admission / education feeof children etc.Loan Amount Minimum TK 50,000.00Maximum TK 3,00,000.00Charges Application fee TK 500.Processing fee TK 1% on the approved loanamount or TK 1000.00 whichever is higherTenor Min 12 monthsMax 36 monthsRate of Interest 16.00p.aSecurity Letter of confirmation from the employer. Onepersonal guarantee (as per list of eligibleguarantors)Product NameHouse /Office Furnishing/ Renovation loan

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Target Customer Expatriate Bangladeshi Nationals who are inbusiness or service holders. Employees ofreputed banks & Leasing companies, reputedlocal corporate, MNCs, NGOs, Airlines,, PrivateUniversities, Schools and Colleges,International Aid Agencies and UN bodies.Government employees, self employedprofessionals, reputed and highly respectable

Purposebusinessman with a reliable source of income.House / office furnishing/ renovation, forinterior decoration/ electrical fittings, wooden

cabinets, purchase / furnishing of apartmentsLoan Amountetc.Min TK 1,00,000.00ChargesMax TK 10,00,000.00Application fee TK 500.00Processing fee 1% on the approved loan amount

or TK 2000.00 whichever is higher.Tenor Min 12 monthsMax 48 monthsRate of Interest 16.50p.a

Security Title deed of the House/Office to be furnished/renovated along with memorandum of depositof title deed duly supported by a notarizedpower of attorney to be kept by the bank as amatter of comfort, Two personal guarantees( as per our list of eligible guarantors).Registered mortgaged of the property if the loanamount is more than Tk 5.00 lac.Product Name Gold Grace Jewelery LoanTarget Customer Both female and employees of reputed banks &


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Leasing companies, reputed local corporate,MNCs ,NGOs, Airlines, Governmentemployees, self employed professionals, reputedand highly respectable businessman with areliable source of income.

Purpose To purchase ornaments/ jewellery for personaluse.Loan Amount Minimum TK 50,000.00Maximum TK 3,00,000.00

ChargesApplication fee TK 500.00Processing account fee: 1% on the approvedloan amount or TK 1000.00 whichever is

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higher.

TenorMin 12 monthsMax 36 months

Rate of Interest16..00p.a

Security Letter of confirmation from the employer.Personal guarantee from the parents and spouse.Product NameStaff Loan

Target customer All permanent employees of AB bank.PurposeMarriages in the family purchase of

miscellaneous household appliances purchase ofpersonal computer purchase of audio-videoequipment purchase of furniture.Loan Amount According to the debt burden ration and othercriteriaCharges Processing fees 1% on the approved loanamount.Tenor Min 12 monthsMax 36 monthsRate of Interest 15.50p.a.Security Hypothecation of the product to be purchased.

Product Name Education loan.Target customer Students criteria Students of reputed educational institute,such as public & private universities,medical colleges & engineering institute.

Undergraduate & Post graduate level.Professional degrees (Chartered


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Accountants (CA), Cost& managementAccountants (CMA), Marine, MBM.MBA).Doctorate degree (PhD), FCPS ETC.Occupation : StudentMinimum age : 17 years5

Maximum age : 40 years Educational Qualification: MinimumHSC / A Level Pass.Parents Criteria:Service holder: Individuals with ranks equivalent toSenior Assistant Secretary or higherqualify guarantor. Banks officials (Equivalent to SeniorPrincipal Officer of NCBs, AVP/ BranchManager of Local and Foreign Banks) andDepartment Head of Multinational

Company or established Local Corporate.Guarantors must be accepted by theBranch Manager/ Head office.Businessman : Well reputed and widely respectedself employed professionals.Purpose To financially assist the parents: Admission/Education fees, Semester fees, Study abroad.Loan Amount Minimum TK 50,000.00Maximum TK 3,00,000.000ChargesTenor Min 12 monthsMax 36 months

Rate of Interest 14.505p.a -16.00%p.aSecurity One personal guarantee (as per list of eligibleguarantors.) Maximum age : 40 years Educational Qualification: MinimumHSC / A Level Pass.Parents Criteria:Service holder: Individuals with ranks equivalent toSenior Assistant Secretary or higherqualify guarantor. Banks officials (Equivalent to SeniorPrincipal Officer of NCBs, AVP/ Branch

Manager of Local and Foreign Banks) andDepartment Head of MultinationalCompany or established Local Corporate.Guarantors must be accepted by theBranch Manager/ Head office.Businessman : Well reputed and widely respectedself employed professionals.Purpose To financially assist the parents: Admission/Education fees, Semester fees, Study abroad.


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Loan Amount Minimum TK 50,000.00Maximum TK 3,00,000.000ChargesTenor Min 12 monthsMax 36 monthsRate of Interest 14.505p.a -16.00%p.aSecurity One personal guarantee (as per list of eligibleguarantors.)Secured Loans

Product Name Personal LoanTarget Customer All clients of ABBL.Purpose To meet personal requirement of fund.Loan Amount Maximum 95% of the present value of thesecurity

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Charges Processing fee: TK 1000.00Tenor Min 12 months, Maximum 36 monthsRate of Interest 13.50%p.a -16.50p.a (subject to type of thesecurity). 2 % spread must be maintained in

case of own bank FDR.

Security Lien over FDR,BSP,ICB Unit,RFCD,NFCD,CD accounts etc. one personalguarantee in case of third party cash collateral(as per list of eligible guarantors)Product Name Personal LoanTarget Customer All clients of ABBL.Purpose To meet personal requirement of fund.Loan Amount Maximum 95% of the present value of thesecurityCharges Processing fee: TK 1000.00Tenor Min 12 months, Maximum 36 months

Rate of Interest 13.50%p.a -16.50p.a (subject to type of thesecurity). 2 % spread must be maintained incase of own bank FDR.Security Lien over FDR,BSP,ICB Unit,RFCD,NFCD,CD accounts etc. one personalguarantee in case of third party cash collateral(as per list of eligible guarantors)Product Name Personal OverdraftTarget Customer All clients of ABBLPurpose To meet personal requirement of fund.Loan Amount Maximum 95% of the present value of the

security

Charges Processing fees TK 1000.00

Tenor Revolving with annual review

Rate of Interest 13.50%p.a-16.50%p.a (subject to type of the

security). 2% spread must be maintained in case


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of own bank FDR.

5Security Lien over FDR,BSP,ICB Unit,RFCD,NFCD,CD accounts etc. one personal

guarantee in case of third party cash collateral(as per list of eligible guarantors)guarantee in case of third party cash collateral(as per list of eligible guarantors)5.2 Corporate BankingAB Bank provides complete range of solutions to meet Corporate Customersrequirements. Its Corporate Banking solutions include a brand spectrum of products andservices backed by proven, modern and technologies.

Corporate LendingThe specialist teams offer a comprehensive service providing finance to large andmedium sized business based in Bangladesh. For more information as to how they mightbest meet customers corporate debt needs, the customers need to contact to the Corporate

Head Office.Structured FinanceAB Bank has a specialist Structured Finance Team who arrange and underwrite financesolutions including Debt and Equity Syndication for financial sponsors, managementteams and corporate. They also provide corporate advisory services.They aim to provide tailored financing solutions with a dedicated team who can rapidlyrespond to client needsFollowing are some of the products and financial tools of Corporate Banking:

.

Project Finance.

.Working Capital Finance.

.Trade Finance.

.Cash Management.

.Syndicated Finance, both onshore & off-shore.

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.Equity Finance, both onshore & off-shore..Corporate Advisory Services.


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5.3SME Banking

Considering the volume, role and contribution of the SMEs, AB Bank has beenpatronizing this sector by extending credit facility of different types and tenor. As ofnow 54% of the banks total loan portfolio is segmented to the SMEs which deservesall out attention in plans, projection and forecasting.

As such the bank has emphasized on the following issues:

To provide the best services to the SME sector. To increase the SME portfolio of ABBL significantly To improve the quality of ABBLS portfolio.SME Sector in which AB Bank has participated so far:.Agro machinery.Poultry.Animal Feed.Dairy Product.

Fruit Preservation.Hotel & Restaurants

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.Garments Accessories

.Leather Products

.Plastic Product

.Furniture : Wooden & Metal

.Ink

.Paint

.

Printing & Packaging

.Wire & Cable

.Aluminum

.Cement & Lime Plaster


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.Clinics and Hospitals

.Engineering & Scientific Instruments.ABBL offers the following SME loan products:

I. Uddog loan.II. Goti loan.III. Aparajita loan.IV. Proshar loan.V. Choto puji loan.VI. Digun loan.Large Loan & Project Finance

.In order to cater the demand of client of AB Bank has segmented its loan size. As perthis segmentation any loan over TK 10.00 core falls under the preview of large loanunit.

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.In AB Bank, there is also a separate Project Finance unit who evaluate the business.The unit is entrusted to handle the portfolio in a focused manner. AB Bank is alwaysin front to support establishment of new projects of diverse nature which will help tobroaden the manufacturing arena to generate to employment.

.At the moment AB has participation in 19 syndicated facilities. AB Banks exposure

in the ongoing syndication is TK51560.29 lac which is diversified in the following tensectors.

SL Sector ABBL Participation(fig in Lac TK)1.Textile 9,533.572. Micro Finance 3,000.003. Cement 7,990.004.Energy & Power 11,997.005.Telephone (PSTN) 5,500.006.Glass 900.00

7.Sugar 900.008.Steel Mills 9081.729.Paper 1158.0010.Chemichal 1,500.00Total 51,560.29

5.4Non Resident Bangladeshi (NRB) BankingFacilities offered to NRBS

Opening of Foreign Currency Account


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AB Bank opens foreign currency Account in USD/GBG/EUR/JPY for NRBs. Foreigncurrency can be remitted by the Nationals of Bangladesh living Abroad earned bythem aswage earners or from other sources. The deposit amount can also be used for remittance

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to other countries as per their requirement. Nominee of account holder can alsoable tooperate this account.

NFCD

AB Bank issues Foreign Currency Fixed Term Deposit in USD/GBP/EUR with differenttenure. Interest is paid in respective Foreign Currency. Rates of interest are published indaily exchange rate.

Wage Earners Development Bond

These bonds can be issued from the balance of the FC account with the tenure forfiveyears. Rate of interest is 12% p.a in BDT.

USD Premium Bond

These bonds can be issued from the balance of the balance of the FC account withtenurefor Three years. Rate of interest is 7.5% p.a in BDT.

USD Investment Bond

These bonds issued from the balance of the FC account with tenure for three year

s. Rateof interest is 6.5% p.a in USD.

In addition to the above, they also have drawing arrangements with 14 years. Exchange /Money transfer Remittance Houses all over the globe to facilitate fast, reliableand hassle-free inward remittance to the expatriate Bangladeshis around the world. They also havespecial arrangements to credit beneficiarys account maintained with them on the sameday thorough extensive real time online network.

Lending Rates

Products Mid Rate Interest Rate W.E.FOctober 06,20091. Agriculture 13.00% 13.00%2.Large and mediumscale industries13.00% 13.00%3.Small Industries ( TermLoan)


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amicBanking affairs, Board of directors as well as management of the bank are very muchinterested to promote Islamic banking system in the bank aiming at opening moreIslamicBranches in the near future.

AB Bank has already obtained membership of Islamic Banks Consultative Forum (IBCF)and Central Shariah Board for Islamic Banks of Bangladesh.

The goals and objectives of Islamic Banking wings are as under:.To facilitate the Islamic banking system in the country..To create new entrepreneurs and to arrange required finance for them..To play effective role for socio economic development of the country..To give assistance in launching welfare oriented economic system under Islamic

values.

Under this wing AB Bank extends the following Islamic banking services:

Deposit Services. Investment Services.Under deposit services the following services are being rendered: Mudaraba Savings Account. Mudaraba Short Noticed Account. Mudaraba Term Deposit Account (with different terms). Mudaraba Monthly Profit Account.5

Al-Wadiah Current Deposit Account. Mudaraba Deposit Pension Scheme.

Foreign Trade:

Islamic Banking Wing provides the following services as its foreign trade desks:.Opening of LCs.Post Import Finance.Export bill purchase and negotiation..Pre- shipment financing. Etc.

AB Bank Islamic Banking wing has been continuously trying to expand its servicehorizonkeeping the necessity of valued clients in view and upholding the principles ofIslamicShariah.

5.6Investment BankingMerchant BankingCustodial ServiceBrokerage Service


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Future Products

Merchant Banking Wing (MBW)

To expand its horizon, ABBL launched its Merchant Banking operation in the year2003. As a fully fledged merchant banker, they provide the following services:

1. Portfolio Management.2. Issue Management.5

3. Underwriting.4. Corporate Advisory.5. Private Placement.The Merchant Banking wing (MBW) of ABBL has made notable progress and ispresently equipped to serve customers needs by offering a comprehensive range offinancial solutions. They also have launched Custodial Services with a view toprovide one stop Capital Market services to our valued clients. They understandanentrepreneurs need for stability, trust, innovation and creativity required for theconsolidation and growth of investments and endeavors to prosper. The professionals

in MBW with its state of the art integrated computerized system, are always there toprovide their vision, knowledge and service for the success of the customer.

Custodial ServiceCustomers

Investors who are interested to invest in the Bangladesh Capital market

.Nonresident Bangladeshi. (NRBs)

.

Foreign institutional and individual clients.

.Local institution

.Sponsors group and high net worth client.

Services

.Safe custody of client securities..

Foreign trade execution and settlement..Share transfer in the name of client..Complete the Dematerialization process as per client request.

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.IPO, Private Placement & Right share subscription as per clientinstruction with deposit.

.All types of corporate action that includes cash dividend, bonus share andright share collection.

.Open BO Account.

.Instant information regarding client securities positions as per theirrequest.

.Quarterly reporting to the client by Custodial Department.

Brokerage Service

AB Bank Foundation (ABBF) is a subsidiary company of AB Bank Ltd having holding99.60% share of the ABBF. The company was first established under the trust deedconstituted and registered on the 14th day of May 2002. Subsequently the trust b

y a resolutionof its Board of Trustee in its third meeting held on 29.12.2002 resolved to cancel the TrustDeed and utilize the trust fund for the foundation of a company limited by guaranteeprimarily for charitable purpose. Then the company was incorporated on 3rd day of November2003 under section 28 of Companies Act 1994, a company limited by guarantee. Thecertificate of incorporation is C- 558 (10)/2003.

The ABBF and its activities:

AB Bank Foundation (ABBF) is one of the countrys leading security broker houses ofDhaka Stock Exchange (member # 201) and Chittagong Stock Exchange (member # 101).ABBF has started its operation by soft launching on 28th August 2006. Initially,they havestarted operation by giving to client of AB Bank Merchant Banking wing. They have alreadystarted operation in full swing in corporate head office and Chittagong. In nearfuture, theywill start their Mohakhali and Agrabad Branch operation.

Services:

1.Brokerage ServicesAB Banks subsidiary, AB Bank Foundation, which has corporate membershipson Dhaka and Chittagong Stock Exchange, can act as brokers on behalf of local

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and foreign individual and institutional client to trade in the local capital ma


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rket.AB Banks Sales & Trading Department will also support brokerage services foroffloading shares through direct listing.

2. CDBL Services as full service Depository Participant (DP)As a full service depository participant, AB Bank Foundation provides followingservices:

A. BO (Beneficial Owner) accounts opening and maintenance.B. Dematerialization.C. Re Materialization.D. Freeze (freeze request and release request) and suspensions.E. Pledging and confiscation.F. BO ISIN balances and master maintenance enquiry.5.7New Products

5.7.1Ogrim Munafa Patra

A depositor may purchase on OMP by depositing the discounted value of theprincipal a receipt for TK. 100,000 with a maturity of 12 months (at12% interestrate) the depositor will have to pay TK. 89,286/- for purchasing the OMPcertificate to any individual, business organization and institution. Simply aminimum of TK. 25,000/- OMPs shall be available for three, six and twelve

months maturity tenures. 12 percent Govt tax and duties are applicable. Loanfacilities will be available at any of the 73 branches of AB Bank.

5.7.2 Be a Millionaire in 3 Years5

The dream of becoming a millionaire is no longer a distant one. Anyone can actuallybecome a millionaire, that too within a space of three to six years, by openingan ABBank Millionaire Scheme Account (MSA)

Monthly deposit of Installments.At the end of the respective term, total savings with interest, after deductionofGovernment tax and duties, will amount to One million Taka. Any individual,business organization or institution can open an MSA. MSAs can be opened forthree, four, five or six- year terms.InterestRateTenor(years)Monthly

SavingsGrossReturnIncome Tax(Currently10%)Net Return12.00% 3 23,602/1,016,711/16,704/1,000,007/


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12.00%4 16,766/1,021,748/21,698/1,000,050/11.50%5 12,836/1,025,586/25,543/1,000,044/11.50%6 10,138/1,030,084/30,015/1,000,070/

5.7.3Troimashik Munafa Hishab

Any individual, business organization or institution can open a TMH. Interest will be paidevery three months from the date of opening of the account. Interest will be creditedautomatically to the designated account.

Time of withdrawal Rate of Interest

Within six months NilBetween six months Prevailing Saving Bank RateSecond Year 9%Third Year 10%

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Chapter 6

6.0 Marketing Strategies Adopted by AB Bank LimitedA marketing strategy can be defined as the outlines of broad marketing logic bywhich the

business unit hopes to achieve its marketing objectives and the specific of target markets,positioning and marketing expenditure levels. It outlines specific strategies for eachmarketing mix element and explains how each responds to the threats, opportunities andcritical issues spelled out in the marketing plan.

6.1Understanding Consumer

Understanding customer and customers needs and requirements is the guiding philosophy ofmarketing. A marketing orientation requires the organization to view its busines

s from thepoint of view of its customers. This demands an insight into the wider aspects of customerpsychology and behavior, including what motivates customers, what their attitudeand

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perception about the company and its products as well as an understanding of the


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ir decisionprocesses.

6.2 Identifying & Targeting Financial ProspectsIn addition to understanding the broader pattern of consumer behavior, the development of aneffective marketing strategy requires AB Bank to understand the differences amongcustomers and their financial products requirements. This issue of customer differences canbe identified through market segmentation. The benefits of market can be an aidin designingmarketing strategy.

The accuracy of AB Banks identification of marketing segmentation contributes toitscompetitive advantage since it is one of the conditions of developing an effective marketingstrategy. A number of conditions have been noted to affect the effectiveness ofpotentialprofitability of marketing strategy like measurability, substantiality, accessibility, action-ability and differentiability of the target. Again ABBL formulates different segmentation on

the basis of geographic or demographic variables.

Segmentation: Bases for segmenting customer

Understanding customer and their needs and requirements are important for developingmarketing strategy. The factors that ABBL emphasize to identify the needs and requirementsare as follows:

For corporate customer

.

Financial Strength and credit worthiness.

.Marketing Positioning.

.Reputation and Integrity.

.Industries.

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.Listed Companies.

For personal banking

.Occupation

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Income and propensity to save

.Attitude toward banking

.Market demand

.Geographic concentration.

6.3 Product Differentiation StrategiesInnovation of new products is the main product differentiation criteria that ABBL uses. Theyalso modify their offerings from that of their competitors. They do this by analyzing thereports, brochure or with client interview, Central Banks information & regulations, lendingrate, deposit rate etc. The main criterion for differentiation is made by the pricing policythrough lowering the lending rate from their competitors.

Other criteria for differentiation are: maturity of products, market demand andgeographic

concentration.

Following are the major common criteria for differentiation of financial products in ABBL:

Rank Differentiation Criteria

1. Pricing policy/ Interest rate2. Maturity of products3. Market demand /Trend4. Geographic concentration.6.4 Channels of Distribution5

Distribution involves a wide variety of activities culminating in the creation of three types ofutility: time, place and possession.

In terms of time, distribution allows the customer to gain access to financial service when it isconvenient for them to buy.

In terms of place, distribution makes products and services available to customers in locationswhich are accessible and convenient to them.

With regard to possession distribution provides the customer with access to theproduct forconsumption or future use. In addition to this, distribution function also provides a means ofeffectively communicating with the customers and for customers to communicate with theBank.

6.5 Pricing for Financial Products


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The pricing of a financial product can appear in many guises: some prices are obvious, someare not, some are based on monetary value and others are not. For example the price of afinancial product may be the interest rate of a loan, the notice required to withdraw moneyfrom an account, a free charge for advice given and commission paid to an intermediary suchas a broker, the tax paid on a interest earned on saving etc.

6.6 Corporate Social ResponsibilityAB Bank has contributed taka 0.5 million to support continuous and smooth functioning ofMosabbir Cancer Care Centre as part of the Banks CSR initiative. The financial assistancewould help the centre to meet necessary day-to-day expenses.

Under Corporate Social Responsibility (CSR) initiative, AB Bank takes pride in joininghands with Mosabbir Cancer Centre, a non profitable philanthropic organization which aimsat extending professional services in the form of counseling, diagnosis, consultation andtreatment of cancer patients particularly to children suffering from terminal di

seases.

The centre has stepped into its 6th year of operation and has rendered servicestoapproximately 800 poor and helpless cancer patients. As part of corporate philosophy, ABBank is always committed to the well being of the society.

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In recent days, AB Banks social welfare events have significantly increased the CSR

penetration.

Database Marketing

ABBL has recently started customer database for marketing purpose. ABBL uses databasefor marketing of their products

Internet Banking

ABBL has their own website. Internet Banking has already been started. But the operation isnot so much extended. Following are the common features are the common features

ofInternet Banking:

.

.Verify deposits.

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.

.

.

View account balances and transaction history.Check loan balances.Check loan payment information.View interest information.Various information regarding products.Chapter -7

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7.0 Customer Services Offered By ABBL7.1Credit Cards

In the present context of banking business in the world, Card is the feature ofany bank.Electronic payment system is now ruling the world and some days from now cashtransactions system will turn into a history found only in the text book.

AB Bank Limited is one of the leading first generation private sector commercialbankswith Branch network all over the country. The bank started issuing VISA Credit Cardsfrom the end of year 2004 as a principal member of VISA International.

Brief description of different features:

Card Conversion & Balance Transfer Plan

Card Conversion & Balance Transfer Plan to AB Bank VISA Credit Card will beextended towards all local Credit Card holders of the market, provided that their otherbanks credit card is in regular state, not in overdue state. Cardholders will repaheapproved transferred amounts to AB Bank Credit Card Account in monthly installmentsstated in their monthly statements. Other bank credit cardholders having regularpaymenthistory will also be allowed to apply for this facility along with their new AB

Bank CreditCard application form. Customers can convert their other bank card to AB Bank Card andget interest facility at 19.95% on their outstanding.

Easy Buy

Easy Buy installment plan to AB Bank VISA Credit Card will be extended towards allAB Bank Visa Credit Cardholders. Cardholders can convert any retail purchase don


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eusing AB Bank credit card into an installment scheme where they can pay back theamount at rate of interest of 19.95% per annum over a tenor ranging from 6 months to 48months.

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Easy, convenient and aff

Documents

54827773 Internship Report AB Bank