The Report Is Prepared on the Basis of 3 Months Practical Experience at IFIC BANK of Bangladesh

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The report is prepared on the basis of 3 months practical experience at IFIC BANK of Bangladesh LTD. The internship program helped me to acquire lot knowledge about the practical situation of a financial institution. This program helped me to implement my theoretical knowledge in to practical and realistic work environment.

In the age of modern civilization, bank is playing vital role to keep to the economic development wheel moving. Bank provides means and mechanisms of transferring command over resources those who have an excess of income over expenditure to those who can make use of the same for adding to the volume of productive capital. There are a large number of small amount of savings who are generally reluctant to invest their surplus income because of their lack of adequate knowledge about complicated investment affairs. The bank provides them with the safety, liquidity, and profitability of savings. The savings bank use as their key of business. Investing the savings in higher degrees of return and maximize their profit in business.

IFIC BANK LTD is a scheduled commercial bank registered by the Bangladesh bank. IFIC BANK LTD follows the rules and regulations prescribed by the Bangladesh Bank. The functions of the bank cover a wide range of banking and functional activities to individuals, firms, corporate bodies and other multinational agencies.

CONTENTS

PARTICULARS: PAGE NO:

• Letter of transmittal 1
• Preface 2
• Acknowledgement 3
• Declaration 4
• Approval from supervisor 5
• Executive summary 6

CHAPTER-I: INTRODUCTION 9-10

• Origin of the report 9
• Objective of the report 9
• Methodology 9
• Scope of the report 10
• Time period of the study 10
• Limitation of the report 10

CHAPTER-II:AN OVERVIEW OF IFIC BANK 11-24

Historical background of IFIC bank 11

Mission of the bank 11

Branches in Bangladesh 12

Organizational structure 14

The management process| 18

International division 21

Capital and resources 22

Working Experience in IFIC Bank 23

Description of my task area 24

CHAPTER III: GENERAL BANKING 25-44

1. Division of general Banking 25

I)Account opening section 25

Different types of account 25

Account Opening procedure 26

Documents required for opening account 27

II) Different scheme 29

III) Cash department 40

IV) Remittance department 40

V) Clearing section 41

VI) Accounts section 42

VII) Several instruments of banking 43

VIII) Online transaction 44

IX) Lockers service 44

X) Foreign currency account 44

CHAPTER IV: LENDING ACTIVITIES OF IFIC BANK 45-48

• Different types lending principles 45
• Types of loans and advances 45
• Process of loan 47
• The revised rates of interest on lending 47
• Reason for loan default 48

CHAPTER-V:FOREIGN EXCHANGE ACTIVITIES 49-65

Meaning of foreign trade 49

Necessities of foreign trade 49

The principal of comparative objective 49

Foreign trade and Foreign exchange operation 50

Major product /services provided by AD branches 51

Deposit product in foreign currencies 52

Mode of the foreign exchange 52

Letter of credit 52

Negotiation of export document 56

Foreign remittance 56

List of foreign exchange statement 57

Regulatory body of foreign exchange 58

SWIFT 59

Problems of foreign trade 60

List of Nostro account 63

CHAPTER VI: FINDINGS OF THE STUDY 66-67

1) General Banking department 66

2) Foreign exchangedepartment 67

3) Credit operationdepartment 67

CHAPTER VII: CONCLUSION AND RECOMMENDATION 68-70

• Recommendation 68
• Questioner part 69

INTRODUCTION

1. ORIGIN OF THE REPORT

This internship report is generated under the supervision of Mr. Iftekharul Alam, Lecturer of Business Administration department of Stamford University, Bangladesh. This internship report is required to fulfill award of MBA Degree. The topic of this report is ‘PEDFORMANCE EVALUATION OF IFIC BANK LIMITED A STUDY ON PALLABI BRANCH. ”The main objective of doing this report is to have a practical experience of the real life aspects of the Financial Institution that we have study in the classroom.To prepare this report I have selected and got opportunity to work as an internee in the reputed and well-known financial institution “IFIC Bank Ltd” at Pallabi Branch.

2. OBJECTIVE OF THE REPORT

The main objective of this report is to introduce myself with the Overall Activities and Performance of the bank and to give myself the opportunity to use this information in preparing a report on a firm.

The objective of the study may be viewed as: 1. General objective 2. Specific objective

General Objective

The general objective of the study is to prepare and submit a report on the topic “Overall Activities and Performance of IFIC Bank Ltd.”

Specific Objective

Identify the strategies for IFIC Bank Ltd. implementing in constant prosperity of the company.

Analyzing the performance trends of the fast growing banking corporation.

To find out the Management problems and solve the problems

To satisfy the shareholders by informing about the company.

To give some idea about its management and organization structure.

To develop our capabilities as an employee in realistic field of the job market.

3. METHODOLOGY

Data have been collected from both primary and secondary source.

Primary source

Register and file study from different department of the branch.

Computer data from accounts section of the branch.

Officer’s desk papers, vouchers etc.

Direct communication with the clients.

Secondary source:

Different papers of IFIC Bank Ltd.

Annual report of IFIC Bank Ltd.

Paper cutting and textbook.

4. SCOPE OF THE REPORT

The scope of the study may be stated as under:

The studywould help top management in planning and decision making.

The study would help management in identifying the key areas of weakness and strength.

The study would aware the top management to take corrective and appropriate measure timely to improve the company performance.

The study would also help the shareholders as a guide to company’s present and future position.

5. TIME PERIOD OF THE STUDY

On the first day the supervisor divided my whole study into three parts. As a result I could learn the whole Baking system as much as possible.

General banking division : 50 days

Foreign exchange division : 40 days

6. LIMITATION OF THE REPORT

Although I have obtained wholehearted co-operation from employees of IFIC Bank Limited, Pallabi Branch, they could not manage enough time to deal with my report. On the way of my study, I have faced the following problems that may be termed as the limitations! Short comings of the study.

Budgeted time for

the Study: The first obstruct is time itself Due to time limit, the scope and dimension of the study has been curtailed. IFIC Bank Limited is a big organization. It was very tough to deal with this bank within this short time. On the other hand due to short time I was unable to interview all the customers who have taken loan.

Data Insufficiency:

Itwas difficult to collect data from such a big organization. Because of some divisional and confidential problem, I could not get enough information.

AN OVERVIEW OF IFIC BANK

1. HISTORICAL BACKGROUND OF IFIC BANK

International Finance Investment and Commerce (IFIC) Bank Limited started banking operations on June 24, 1983. Prior to that it was set up in 1976 as a joint venture finance company at the instance of the Government of the People's Republic of Bangladesh. Government then held 49 percent shares while the sponsors and general public held the rest.

The objectives of the finance company were to establish joint venture Banks Finance Companies and affiliates abroad and to carry out normal functions of a finance company at home. When the Government decided to open up banking in the private sector in 1983, the above finance company was converted into a full-fledged commercial Bank. Along with this, the Government also allowed four other commercial Banks in the private sector. Subsequently, the Government denationalized two Banks, which were then fully Government-owned. While in all these Banks Government held nominal 5 percent shares, an exception was made in the case of this Bank. It retained 40 percent shares of the Bank.

The decision by the Government to retain 40 percent shares in IFIC Bank was in pursuance of the original objectives, namely, promotion of joint participation of Government and private sponsors to establish joint venture Banks, financial companies, branches and affiliates abroad.

2. MISSION OF IFIC BANK:

Our Mission is to provide service to our clients with the help of a skilled and dedicated workforce whose creative talents, innovative actions and competitive edge make our position unique in giving quality service to all institutions and individuals that we care for.

We are committed to the welfare and economic prosperity of the people and the community, for we drive from them our inspiration and drive for onward progress to prosperity.

We want to be the leader among banks in Bangladesh and make our indelible mark as an active partner in regional banking operating beyond the national boundary. In an intensely competitive and complex financial and business environment, we particularly focus on growth and profitability of all concerned.

3. BRANCHES IN BANGLADESH:

BRANCHES IN DHAKA DIVISION

Federation Branch

Moulvibazar Branch

Dhanmondi Branch

Shantinagar Branch

Gulshan Branch

Pallabi Branch

Islampur Branch

Bangshal Branch

Elephant Road Branch

Naya Paltan Branch

Kawran Bazar Branch

Malibagh Branch

Narayanganj Branch

Netaiganj Branch

Konabari Branch

Muktarpur Branch

Narsingdi Branch

Ghorasal Branch

Madhabdi Branch

Bajitpur Branch

Mymensingh Branch

Faridpur Branch

Uttara Branch

Lalmatia Branch

Takerhat Branch

North Brooke Hall Road Branch

CHITTAGONG DIVISION

Agrabad Branch

Khatunganj Branch

Terri Bazar Branch

Sheikh. Market Branch

Hathazari Branch

Chawk Bazar Branch

Shah Amanat Market Branch

Sheikh Mujib Road Branch

Cox's Bazar Branch

Brahmanbaria Branch

Comilla Branch

Feni Branch

CompaniganjBranch

Agrabad Branch

Khatunganj Branch

Terri Bazar Branch

Sheikh. Market Branch

Hathazari Branch

Chawk Bazar Branch

Shah Amanat Market Branch

Sheikh Mujib Road Branch

Cox's Bazar Branch

Brahmanbaria Branch

Comilla Branch

Feni Branch

Companiganj Branch

KHULNA & BARISHAL DIVISION

Khulna Branch

Jessore Branch

Satkhira Branch

Noapara Branch

Kushtia Branch

Barisal Branch

Benapole Branch

Borabazar Branch

RAJSHAHI DIVISION

Rajshahi Branch

Naogaon Branch

Pabna Branch

Rangpur Branch

Dinajpur Branch

Bogra Branch

Capai Nawabganj Branch

SYLHET DIVISION

Sylhet Branch

Beani Bazar Branch

Tultikar Branch

Subid Bazar Branch

Moulvi Bazar Branch

Shreemongal Branch

Uposhohar Brach

4. ORGANIZATIONAL STRUCTURE:

ELECTED`DIRECTORS
Representing 'A' Class Shareholders
01 / Mr. Manzurul Islam / Chairman
02 / Mr. Saiful Islam / Director
03 / Mr. Abul Matin Khan / Director
04 / Mr. Abdul Hamid Chowdhury / Director
05 / Mr. A. R. Malik / Director
Nominated Directors
Representing 'B' Class Shareholders
(Government of Bangladesh)
06 / Mr. Mohammad Janibul Huq / Director
07 / Mr. ATM Ataur Rahman / Director
08 / Dr. Chowdhury Saleh Ahmed / Director
09 / Mr. Md. Mokhles ur Rahman / Director
10 / Mr. Mashiur Rahman / Managing Director

EXECUTIVES OF THE BANK:

Managing Director Mr. Mashiur Rahman
Deputy Managing Director Mohammad Abdullah
Senior Executive Vice Presidents
01 / Dr. R.M. Debnath, Group Executive (Services - I)
02 / Mr. Mokhlessur Rahman Sharif, Group Executive (Services - III)
03 / Mr. Md. Farhatullah, Group Executive (Services - II)
04 / Mr. Mohammad Abdullah, Group Executive (Operations - II)
05 / Mr. Khundaker Mobarak Husain, Manager, Motijheel Branch
06 / Mr. Delwar Hossain, Group Executive (Operations - V)
Executive Vice Presidents
01 / Mr.Md. Abdus Sattar Mia, Group Executive (Operations - III)
02 / Mr. Mohammed Ali Karim, Chief of the Chittagong Region
03 / Mr.Md Abdus Salam, Group Executive (Group General - I)
04 / Mr. Mosharraf Hossain
05 / Mr. A.K.M. Mozharul Hoque, Group Executive (Group General - II)
06 / Mr.Md. Ziaul Bari, In-Charge (Operations - I)
07 / Mr. Syed Zahidul Islam
08 / Mr. S.M. Abdul Hamid
09 / Mr. Mati-Ul-Hasan, Manager, Federation Branch
10 / Mrs. Zaitun Sayef, Manager, Agrabad Branch, Chittagong
11 / Mr. Sk. Rashid Ahmed, Manager, Dhanmondi Branch
Senior Vice Presidents
01 / Mr. Manawar Hussain Chowdhury
02 / Mr.Md. Abul Hossain
03 / Mr.Md. Abu Tayeb
04 / Mr. Narayan Chandra Roy
05 / Mr. A.K.M. Shafiqul Alam
06 / Mr. Syed Abul Kalam Azad
07 / Mr. Fariduddin Al-Mahmud
08 / Mr.Md. Sharifur Rahman
09 / Mr. Tapan Kanti Sarkar
10 / Mr. Wakar Hasan
First Vice Presidents
01 / Mr. Abdus Salam Miah
02 / Mr.Md. Bader Kamal
03 / Mr.Md. Ruhul Amin
04 / Mr. Gopal Chandra Guha Roy
05 / Mr. Harun Ar Rashid, NIB(Lahore)
06 / Mr. Kazi Saifuddin Ahmed
07 / Mr.Md. Ataur Rahman
Vice Presidents
01 / Mr. M. Haroun Al-Raschid
02 / Mr. Shahid Atiqul Islam
03 / Mr. A.M.M. Aminul Haque
04 / Mr. Ashrafur Rahman Khan
05 / Mr.Md. Nazrul Islam
06 / Mr.Md. Shahjahan Miah
07 / Mr. Jahir Uddin Ahmed
08 / Mr. Sajjad Zabir
09 / Mr. M. Shahed Shah Munna, GeneralManager, Oman International Exchange LLC
10 / Mr.Md. Mohidur Rahman
11 / Mr. Abu Nasser Al-Razi
12 / Mr. Shah Md. Moinuddin
13 / Mr.Md. Rafiqul Bari Chowdhury
14 / Mr. Mir Golam Mowla (Pinto)
15 / Mr.Md. Shahjahan Kabir

FUNCTIONAL DIVISIONS AT HEAD OFFICE

Managing Director, ex-officio Director of the Board, is the Chief Executive Officer (CEO) of the Bank. Under direct control of the Managing Director is the Deputy Managing Director.

The operations and activities at the Head Office have been divided into twelve Groups; each headed by a Group Executive / In-Charge who reports directly to the Chief Executive. All Divisions at Head Office are required to report to the respective Group Executives.

Under Operations Group-I is General Credit Division, Project Finance Division & Lease Financing Wing.

Operations Group-II consists of four Divisions, namely, Overseas and International Banking Relations Department, Garments Department, Foreign Trade Department & Treasury Department. Internal Control & Compliance Division works under Operations Group-III.

Operations Group-IV comprises Central Accounts Division, General Banking Division and Establishment Division.

Operations Group-V consists of Recovery Division.

Besides six operational Groups, there are four Services Groups.

Services Group-I consists of Human Resources Division, Planning, Research & Statistics Division.

Services Group-II has Branch Expansion Division, Business Development Division, Marketing Division and Special Project Division. Law Division has been placed with Services Group-III.

IFIC is one of the pioneer private Bank in adopting IT from its inception during 1985. To expand computerization facilities to all the branches of our bank and to reach improved IT facilities to the bank's customer a new Group Services -IV has been formed headed by a very Senior Banker. IT Division is under this group.Recently two new Groups has been formed, namely, Group General - IGroup General - II.

Under Group General -I is MD's Secretariat and Vigilance Cell. Group General -II consists of Personnel & Administration Division and Secretary's Division.

WORKFORCE: Total manpower stood at 1,868 as on December 31, 2003. Out of them 1,266 were officers and 602 were non-officer employees. The number of female employees in the bank on the date was 238.

Following shows the growth of manpower over last five years.

Year / Officer / Staff / Total / Female Officers & Staff
1998 / 1,081 / 543 / 1,624 / 162
1999 / 1,124 / 535 / 1,659 / 176
2000 / 1,151 / 549 / 1,700 / 188
2001 / 1,189 / 548 / 1,737 / 200
2002 / 1,201 / 554 / 1,755 / 213
2003 / 1,266 / 602 / 1,868 / 238

5. THE MANAGEMENT PROCESS(Human Resources Development):

Human Resources Development (HRD) activities aim at fulfilling the bank's Mission. One of our four major missions is to: "Provide service to our clients with the help of a skilled and dedicated workforce whose creative talents, innovative actions and competitive edge make our position unique in giving quality service to all institutions and individuals that we care for."

Skilled and dedicated workforce with creative talents, innovative actions are not always readily available. Appreciating the scarcity of such manpower, the bank from the very beginning laid importance to HRD that conceptually includes activities like: pre-recruitment drill, recruitment, induction, training in the Academy, job rotation, placement & posting, reward and promotion. All these activities are planned by the bank in an integrated way aiming at manpower with required amount of technical, managerial, human and conceptual skills.

Management of IFIC Bank not only appreciates the need of skills required for day to day banking but also realizes the need for skills to meet the global & national financial and economic environments that are changing fast. Meeting the needs of new skills arising out of Financial Sector Reforms Programme (FSRP) is also a major concern of the management. The bank, therefore, set up a Division namely HRD Division under a separate Group called Services Group-I. The Academy of the bank works under this group. The other Division, which works under the Services Group-I, is Planning, Research & Statistics Division.

GROUP OPERATION-I

Operations-I, a group segment of Head Office operation of the Bank mainly handles General Advance/ Credit Portfolio, Project finance excluding Overseas Operations of the Bank and Lease Financing. The Group is headed by Senior Executives having commendable professional knowledge and experience supported by a talent pool of MBA's, Engineers, Economists, and Statisticians etc. with the blending of credit experience.

GROUP STRUCTURE:

A.Group Executive/In-Charge: Mr.Md. Ziaul Bari, Executive Vice President

B. Functional Structure :The Group Comprises of 3 Divisions as under:

i) General Credit Division

ii) Project Finance Division

iii) Lease Financing Division

C. Area of Operation:

i) General Credit Division

a) Sanction Department:

This department mainly handles Credit Portfolio of the Bank related to Working Capital and Trade Finance. Proposals of such nature are processed/ appraised and disposed of by this department. The department is manned by a group of professionals from respective discipline with commendable banking experience as well as exposure in modern concept and technology.

b) Credit Administration Department:

The function of this department is to monitor credit portfolio of the Bank through physical inspection of various periodical returns, Audit/Inspection Report etc. with a view to maintaining a healthy asset base of the Bank.

c) Credit Information & Returns Department:

This department deals in preparation of different periodical returns related to credit portfolio of the Bank for management information as well as for submission of information/data to Regulatory Body and various controlling agencies. The department also centrally handles all jobs relating to Loan Classification of the Bank.

d) Ancillary Functions: