...1.0 INTRODUCTION The commercial banking system dominates Bangladesh's financial sector. Bangladesh Bank is the Central Bank of Bangladesh and the chief regulatory authority in the sector. There are a total of 51 banks in Bangladesh, and this banking system is composed of four state-owned commercial banks, five specialized development banks, thirty eight private commercial Banks and nine foreign commercial banks. Hence we can easily say that the private commercial banks (PCBs) comprise for the largest portion of the banking sector. The banking sector has attracted a lot of fresh graduates for a very long time because of their work environment and other facilities that they provide. Moreover, the work environment and culture of the private commercial banks are such that the employees are motivated to work and prove themselves to their employers. One such approach made by PCBs was to offer a higher post to the young, newly hired graduates as they believed that this would help to increase employee satisfaction. This strategy has by many means been successful as well as a little unsuccessful for the banks. The overall study shows that simply hiring employees in higher posts cannot increase their overall job satisfaction; rather, a lot of other factors also need to be considered in order to ensure the satisfaction of the employees. 2.0 OBJECTIVE The main objective of this paper is to show how much effective the attempt was made by the owners of the PCBs to increase employee...
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...The role of Financial Market and Institution in the Economic Development of Bangladesh Financial market Financial market is created to satisfy particular preferences of market participants.Financial markets transfer funds from those who have excess funs to those who needfunds. That is they facilitate the transfer of funds from surplus unit to deficit unit .Because funding needs vary among deficit units, various financial markets have beenestablished. The primary market allows for the issuance of new securities, while thesecondary market allows for the sale of short term securities, while capital marketsfacilitate the sale of long term securities.The main participants of financial market can be classified as households, businesses andgovernment agencies. Those participants who provide funds to the financial markets arecalled surplus unit . Households are the main type of surplus unit. Participants who usefinancial markets to obtain the funds are called the deficit unit . Money market: Money market an integral part of the financial market of a country. It provides a mediumfor the redistribution of short term loan able funds among financial institutions, which perform this function by selling deposits of various types, certificate of deposits anddiscounting of bills, treasury bills etc. The participants in the money market are: thecentral bank, commercial banks, the government, finance companies, contractual savinginstitutions like the pension funds, insurance companies...
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...FINANCIAL DEVELOPMENT OF A COUNTRY IS HIGHEST IN THE INITIAL STAGE. MODERN BANKS PLAY AN IMPORTANT PART IN PROMOTING ECONOMIC DEVELOPMENT OF A COUNTRY. BANKS PROVIDE NECESSARY FUNDS FOR EXECUTING VARIOUS PROGRAMMERS UNDERWAY IN THE PROCESS OF ECONOMIC DEVELOPMENT. THEY COLLECT SAVINGS OF LARGE MASSES OF PEOPLE SCATTERED THROUGHOUT THE COUNTRY, WHICH IN THE ABSENCE OF THE BANKS WOULD HAVE REMAINED IDEAL AND UNPRODUCTIVE. THESE SCATTERED AMOUNTS ARE COLLECTED, POOLED TOGETHER AND MADE AVAILABLE TO COMMERCE AND INDUSTRY FOR MEETING THE REQUIREMENTS. ECONOMY OF BANGLADESH IS IN THE GROUP OF WORLD’S MOST UNDERDEVELOPED ECONOMIES. ONE OF THE REASONS MAY BE ITS UNDERDEVELOPED BANKING SYSTEM. GOVERNMENT AS WELL AS DIFFERENT INTERNATIONAL ORGANIZATIONS HAVE ALSO IDENTIFIED THAT UNDERDEVELOPED BANKING SYSTEM CAUSES SOME OBSTACLES TO THE PROCESS OF ECONOMIC DEVELOPMENT. SO THEY HAVE HIGHLY RECOMMENDED FOR REFORMING FINANCIAL SECTOR. SINCE 1990, BANGLADESH GOVERNMENT HAS TAKEN A LOT OF FINANCIAL SECTOR MORE TRANSPARENT, AND FORMULATION AND IMPLEMENTATIONS OF THESE REFORM ACTIVITIES HAS ALSO BEEN PARTICIPATED BY DIFFERENT INTERNATIONAL ORGANIZATIONS LIKE WORLD BANK, IMF, ETC. IN 1996, WORLD BANK PUBLISHED ‘BANGLADESH: AGENDA FOR ACTION’ IN WHICH IT HAS SUGGESTED A LOT OF RECOMMENDATIONS FOR ECONOMIC DEVELOPMENT OF OUR COUNTRY. THESE RECOMMENDATIONS INCLUDE SPECIAL PRESENTATION FOR REFORMING BANKING SECTOR. BANK IS THE MOST IMPORTANT FINANCIAL INSTITUTION IN THE ECONOMY. IT PLAYS A VITAL...
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...Introduction: Banks are very old form of financial institution that channels excess fund from surplus unit to deficit unit in consideration of a price called interest. Banking business definitely established on a relationship of Debtor-creditor between the surplus unit called depositor and the bank and between the deficit unit called borrowers and the bank. Here, opportunity coast of money works as interest is considered the price of the credit. For the development of an economy, bank furnishes a huge contribution and modem economy can not be imagined without the service of bank. Economic development of a country requires a well organized, smooth, easy to reach and efficient saving-investment process. The function of a single bank is not limited to its geographical region only rather it has reached beyond the border of the country. So banking business has been shaped as global business and the rest other business greatly depend on the strength of banking business performance. The recent financial crisis showed many weaknesses within the on hand financial system across the world. This triggers many issues linking to the protection of banking institution against probable future non expected risks associated with periods of insecurity. Bank regulatory authorities are directly liable to evaluate the performance of each banking business to find out any flaw. Regulatory authority should have to sense any upcoming difficulties regarding the performance of the all banks. For that...
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...Case study Bangladesh: Financial Linkages in Bangladesh Abdul Awal, Director, CDF Abstract: Microfinance in Bangladesh has almost reached the stage of a matured market. However, there are still substantial segments of potential clientele who are not serviced by any microfinance organization (MFI). Inadequate finance is one of the most important reasons MFIs have not reach these clients. Fund shortage is more prevalent among the smaller MFIs. Moreover, due to the scaling up of microenterprises of the existing clients, they are requiring larger loan amounts. On the other hand, though the formal financial organizations are burdened with significant amounts of excess liquidity, they are not in a position to directly provide services to microcredit clients - it is not viable. Even funding operations of smaller MFIs directly, are out of their reach. In such a situation, an effective linkage between the MFIs with financial constraint and banks with excess liquidity is a simple but highly effective solution. Introduction Poverty has always been on the development agenda in Bangladesh. In the history of this country, poverty has been rampant and presently Bangladesh is third in terms of number of poor following India and China. It is a densely populated country of only 150,000 square kilometers and a population of around 140 million. The country consists mainly of a flat delta plain. In addition to its very high population density, the country has a limited natural resource base and is...
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...Report On Contribution of Banks on SME Sector in Bangladesh 1 LETTER OF TRANSMITTAL 2 ACKNOWLEDGEMENT 3 Table of contents No: Page: Chapter One Introduction 1.1 Introduction 1 1.2 Background of the study 2 1.3 Problem statement 3 1.4 Objectives of the study 3 1.5 Scope of the study 4 Chapter Two Methodology 2.1 Data requirement 5 2.2 Study area 6 2.3 Sample size selection 6 2.4 Questionnaire development 7 2.5 Literature review 8 2.6 Small enterprise 10 2.7 Medium enterprise 10 2.8 SME financing by Banks in Bangladesh 11 Chapter Three Results 3.1 Contribution of SMEs in the economy 13 3.2 Current status of SME financing by Bangladesh Bank 14 4 3.3 Loan documents needed for SME financing by banks 14 3.4 About the sample banks 15 3.5 Portfolio size of different banks in SME sector 17 3.6 Target given by Bangladesh Bank 19 3.7 Survey analysis 24 3.8 Findings 27 Chapter Four 29 Limitation Chapter Five 30 Conclusions and recommendation Appended Parts Data collection instruments Details of entrepreneurs Bibliography List of Tables 3.1 Portfolio size of Different Banks in SME sector 17 3.2 Distribution of entrepreneurs whether or not they take bank loan 24 to operate their SME business. 3.3 Distribution of entrepreneurs...
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...system of Bangladesh Central bank: * Bangladesh bank Schedule bank: State-owned commercial banks: State-owned are functioning as nationalist. Here is the list - 1. Sonali Bank Limited 2. Janata Bank Limited 3. Agrani Bank Limited 4. Rupali Bank Limited Private commercial banks(PCB): * Conventional private bank 1. AB Bank Limited 2. Bangladesh Commerce Bank Limited 3. Bank Asia Limited 4. BRAC Bank Limited 5. Dhaka Bank Limited 6. Dutch Bangla Bank Limited 7. Eastern Bank Limited 8. IFIC Bank Limited 9. Jamuna Bank Limited 10. Meghna Bank Limited 11. Mercantile Bank Limited 12. Midland Bank Limited 13. Modhumoti Bank Limited 14. Mutual Trust Bank Limited 15. National Bank Limited 16. NCC Bank Limited 17. NRB Bank Limited 18. NRB Commercial Bank Limited 19. NRB Global Bank Limited 20. One Bank Limited 21. Prime Bank Limited 22. Pubali Bank Limited 23. South Bangla Agriculture and Commerce Bank Limited 24. Southeast Bank Limited 25. Standard Bank Limited 26. The City Bank Limited 27. The Farmers Bank Limited 28. The Premier Bank Limited 29. Trust Bank Limited 30. United Commercial Bank Limited 31. Uttara Bank Limited * Islamic private bank: 1. Al-Arafah Islami Bank Limited 2. Export Import Bank of Bangladesh Limited 3. First Security Islami Bank Limited 4. ICB Islamic Bank Limited 5. Islami Bank Bangladesh Limited 6. Shahjalal islami Bank Limited...
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...Commercial Bank Commercial bank: Commercial bank mostly deals with deposits and loans from corporations or large businesses. Famous Commercial Banks of Pakistan are Muslim Commercial Bank(MCB),United Bank,Habib Bank. Functions of Commercial Banks: The functions of a commercial banks are divided into two categories: - Primary functions - Secondary functions including agency functions. - Primary functions: The primary functions of a commercial bank include: - accepting deposits; and - granting loans and advances The role of commercial banks Commercial banks engage in the following activities: * processing of payments by way of telegraphic transfer, EFTPOS, internet banking, or other means * issuing bank drafts and bank cheques * accepting money on term deposit * lending money by overdraft, installment loan, or other means * providing documentary and standby letter of credit, guarantees, performance bonds, securities underwriting commitments and other forms of off balance sheet exposures * safekeeping of documents and other items in safe deposit boxes * sale, distribution or brokerage, with or without advice, of insurance, unit trusts and similar financial products as a “financial supermarket” * cash management and treasury services * merchant banking and private equity financing * traditionally, large commercial banks also underwrite bonds, and make markets in currency, interest rates, and credit-related...
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...Data 5 6.2.2 Primary Data 5 6.2.2.1 Population 5 6.2.2.2 Working Population 5 6.2.2.3 Sampling Design 5 6.2.2.4 Data Collection Method 6 6.2.2.5 Data Survey and Scaling Techniques 6 6.3 Data Analysis 7 7. Time Scale/Research Planning 7 8. Timetable 9 9. Problems of the Fact 10 10. Conclusion 10 11. Reference 11 12. Appendix 12 Abstract Commercial Banks are the most dominant financial institutions in the domain of commerce and industry. The efficiency of commercial banks is dependent on their ability to mobilize fund profitability, which can enhance their corporate value. There can be few, if any, parts of the economy in which risk management is more important than the financial sector. Financial institutions account for a sizeable number of the world's leading companies and have a critical role to play in the economics of every country and thus in world economic order as a whole. The research will be focusing on the case study method by interviewing the concerned person that will provide detailed analysis of such Bangladeshi commercial banks of the country as their business operation is being centered on taking risks in conditions of uncertainty. The process with such focus on how outcomes relate to effective risk management will be deemed important. The results should achieve in answering such issues and problems presented based on research findings and information researches to support whatever data is gathered respectively...
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...and Performance in Banking Industry: The Case of Bangladesh S. M. Sohrab Uddin PhD Student, Graduate School of Asia Pacific Studies Ritsumeikan Asia Pacific University, Japan & Assistant Professor, Department of Finance and Banking, University of Chittagong, Bangladesh E-mail: smsohrabcu@yahoo.com Yasushi Suzuki Professor, Graduate School of Management Ritsumeikan Asia Pacific University, Japan E-mail: szkya@apu.ac.jp Received: December 17, 2010 Accepted: January 20, 2011 doi:10.5539/ijbm.v6n7p28 Abstract Bangladesh entered into the era of financial reform during the early 1980s. Most of the reforms initiated by the government have concentrated predominantly on the banking sector. Consequently, many changes relating to ownership, market concentration, regulatory measures and policies have taken place primarily to enhancing bank performance. In this regard, this study is undertaken to investigate the performance of commercial banks after the implementation of significant financial reform. Data Envelopment Analysis based frontier measures income and cost efficiency and traditional non-frontier measures non-performing loans and return on assets have been used for assessing bank performance. The findings indicate that income and cost efficiency of sample banks have increased by 37.84 percent and 15.28 percent respectively in 2008 compared to 2001. Similarly, non-performing loans and return on assets also report improvement in bank performance. The results generated by regression...
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...Banking Industry in Bangladesh: Bangladesh is a third world country with an under developed banking system, particularly in terms of the services and customer care provided by the government run banks. Recently the private banks are trying to imitate the banking structure of the more developed countries, but this attempt is often foiled by inexpert or politically motivated government policies executed by the central bank of Bangladesh, Bangladesh Bank. The outcome is a banking system fostering corruption and illegal monetary activities/laundering etc. by the politically powerful and criminals, while at the same time making the attainment of services or the performance of international transactions difficult for the ordinary citizens, students studying abroad or through distance learning, general customers etc. The banking industry composed of 4(four) state owned commercial banks, five specialized banks, thirty nine private commercial banks, and nine foreign commercial banks. Banking Industry explained by Porter’s 5 factors: Michael E. Porter developed Five factors that act together to determine the nature of competition within an industry that affect a business ability to compete. These are: * Threat of new entrants to a market * Bargaining power of suppliers * Bargaining power of customers /buyers * Threat of substitute products * Degree of competitive rivalry They are discussing below: * Threat of new entrants to an industry In the banking...
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...Company of Bangladesh Limited.) this industry has shown so much prospect as well as progress. Sharing some common characteristics of Banks & some of its own it brought diversification in the financial market. In the same time it witnessed impressive growth during the last years. In our country like most other industries financial institutions are also big city especially Dhaka concentrated. Financial institutions rarely spread their branches outside divisional cities let alone the urban areas. So the fierce competition among as well as across the group is strengthening. So the market segmentation, expansion and product diversification may be some key tools to get out of the situation for the FIs. But currently the industry seems to become matured with so many competitors. The recent inclusion of another two new financial institutions (Bangladesh Infrastructure Finance Fund Limited (BIFFL) & Agrani SME Financing Company Limited) in the market has increased the number of competitors at 31. From the research & provided data it is very clear that the companies are trying to strengthen their position in the market as the investment n fixed asset seems to on the rise. Besides following the stock market crash in 2010 and recent rise in the dollar price, the cost of fund has also significantly jumped. Altogether these factors are provoking the decline in the growth in income for the companies. As per Section 7 of the Banking Companies Act 1991, commercial banks also started...
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...2SERVICES .................................................................................................................3ANALYSIS ....................................................................................................................5Performance of Banking Sector .................................................................................5Balance Sheet Performance ........................................................................................6Assets ..................................................................................................................... 6Liabilities ................................................................................................................6Performance and Rating of Banks ..............................................................................6Capital Adequacy ...................................................................................................7Asset Quality ..........................................................................................................8Management Soundness .........................................................................................9Earnings and Profitability .....................................................................................10Liquidity ............................................................................................................... 11CAMELS Rating...
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...Abstract The objective of this study is to have practical knowledge on the Retail Banking services provided by the Private Conventional Banks and the Islamic banks in Bangladesh. Today, banks realize the importance of Retail Banking and its potential to help them acquire new customers, retain existing ones and maximize their lifetime value. this report provides an overall view of Retail Banking services in Bangladesh. the services provided by Private Conventional Banks and the Islamic banks are mentioned. Followed by are the products that are being used to provide these services. A trend of the retail banking services is done in the analysis part of this report. The Islamic banking concept is being adopted by some of the Private Commercial Banks to generate better understanding of the customer for product development, segmentation, appropriate targeting, campaign management and maintenance of long term profitable and mutually beneficial relationships with customers. The concept of Islamic Banking has been implemented on a vast scale. To meet the objective of the report a trend analysis of the retail deposit indicators,retail deposits and loans and advances is done in the fifth part of the report. there growth is also shown with line graphs. A comparison is also made between the PCB's retail banking services and that of IB's. In part six findings are listed and some recommendations are also made accordingly. Table of Contents Sl No | Topic | Page No. | 1.0 | Introduction1...
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