General Banking, Service level And Customer Satisfaction of Rupali Bank Limited

Posted: July 16, 2014 in Internship Report
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1.01 Introduction:

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Generally by the word “Bank” we can easily understand that the financial institution deals with money. But there are different types of banks like; Central Banks, Commercial Banks, Savings Banks, Investment Banks, Industrial Banks, Co-operative Banks etc. But when we use the term “Bank” without any prefix, or qualification, it refers to the ‘Commercial banks’. Commercial banks are the primary contributors to the economy of a country. So we can say Commercial bank is a profit-making institution that holds the deposits of individuals & business in checking & savings accounts and then uses these funds to make loans. For these people and the government is very much dependent on these banks as the financial intermediary. As, banks are profit-earning concern; they collect deposit at the lowest possible cost and provide loans and advances at higher cost. The differences between two are the profit for the bank. To Download this Report

 

Banking sector is expanding its hand in different financial events every day. At the same time the banking process is becoming faster, easier and the banking arena is becoming wider. As the demand for better service increases day by day, they are coming with different innovative ideas & products. In order to survive in the competitive field of the banking sector, all banking organizations are looking for better service opportunities to provide their fellow clients. As a result, it has become essential for every person to have some idea on the bank and banking procedure.

1.02 Origin Of the Study:

 

After completing my graduation as a student of BBA, Atish Dipankar University of Science and Technology (ADUST), I like to do Internship in a reputed Bank, which would be helpful for my future professional career. I got the opportunity to perform my internship in the Rupali Bank Ltd. It was a Three months long practical orientation program.

This report is originated as the requirement of Rupali Bank Ltd and as well as my degree.

1.03 Objective Of the Report:

 

The primary objective of this report is to provide overviews on the function of Rupali Bank ltd. Objectives of the study are summarized in the following manner:

 

  • Give an overview of Rupali Bank.
  • To explore General Banking activities of Rupali Bank Ltd.
  • To explore Foreign Exchange activities of Rupali Bank Ltd.
  • To gain comprehensive knowledge about the present General banking scenario of Rupali Bank.
  • To identify the existing problems of the stated department.
  • Giving suggestion for betterment

 

 

1.04 Methodology:

 

Both primary and secondary source of data were used to prepare this report. This report has been prepared on the basis of experience gathered during the period of internship from 17 July, 2011 to 17 October, 2011. For preparing this report, I have undergone group discussion, collected data and sent some questionnaires to the selected Officers and interviewed with some of them. I also studied different circulars and files of the bank.

 

 

1.05 Scope Of the Report:

 

As I was sent to Rupali Bank Ltd. Zingera Branch, the scope of the study is only limited to this branch. The report covers its overall department wise function, structure and performance. The report also covers details about Rupali Bank Ltd.

 

 

 

 

 

 

1.06 Limitations:

 

The present study was not out of limitations. But as an intern it was a great opportunity for me to know the banking activities of Bangladesh specially Rupali Bank ltd. Some constraints are appended bellow:

  • As some of the fields of banking are still not covered by our courses, there was difficulty in understanding some activities.
  • Every organization has their own secrecy that is not revealed to others. While     collecting data i.e. interviewing the employees, they did not disclose much information for the sake of the confidentiality of the organization.
  • Since the bank personals were very busy, they could provide me very little time.
  • Another problem is that creates a lot of confusions regarding verification of data. In some cases more than one person were interviewed to clarify each concept as many of the bankers failed to provide clear-cut idea about the job they perform.
  • The clients were too busy to provide me much time for interview.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organizational Profile

 

 

 

 

 

 

 

 

 

 

 


2.01 Historical Background of Rupali Bank ltd.

 

Rupali Bank Ltd. was constituted with the merger of 3 (three) erstwhile commercial banks i.e. Muslim Commercial Bank Ltd., Australasia Bank Ltd. and Standard Bank Ltd. operated in the then Pakistan on March 26, 1972 under the Bangladesh Banks (Nationalization) Order 1972 (P.O. No. 26 of 1972), with all their assets, benefits, rights, powers, authorities, privileges, liabilities, borrowings and obligations. Rupali Bank worked as a nationalized commercial bank till December13, 1986.
Rupali Bank Ltd. emerged as the largest Public Limited Banking Company of the country on December 14, 1986.

 

Organization

i.       Identify each market segment.

ii.       Write down the requirements.

iii.       Communicate the requirements.

iv.       Organize processes.

v.       Organize physical spaces.

Customer care

vi.       Meet the customer’s expectations.

vii.       Get the customer’s point of view.

viii.       Deliver what is promised.

ix.       Make the customer feel valued.

x.       Respond to all complaints.

xi.       Over-respond to the customer.

xii.       Provide a clean and comfortable customer reception area.

 

 

 

 

 

Communication

xiii.  Optimize the trade-off between time and personal attention.

xiv.  Minimize the number of contact points.

xv.  Provide pleasant, knowledgeable, and enthusiastic employees.

xvi.  Write documents in customer-friendly language.

 

Front-line people

xvii.  Hire people who like people.

xviii.  Challenge them to develop better methods.

xix.  Give them the authority to solve problems.

xx.  Serve them as internal customers.

xxi.  Be sure they are adequately trained.

xxii.  Recognize and reward performance.

Leadership

 

xxiii.  Lead by example.

xxiv.  Listen to the front-line people.

xxv.  Strive for continuous process improvement.

 

 

Finally, I have measured the efficacy of Rupali Bank Ltd’ customer services by using the progress of the Bank, because the efficacy of customer service is related with progression of operation. I have analyzed the following factors to measure the efficacy of customer services:

 

2.02 Mission of Rupali Bank ltd.

 

  • To provide excellent quality customer service
  • To become a trusted repository for customer’s money and their financial advisor
  • To display team spirit and professionalism
  • To have a sound capital base
  • To be the finest bank in the banking area
  • To maintain corporate and business ethics

2.03 Vision of Rupali Bank ltd.

To become a leading banking institution and to play a pivotal role in the development of the country. The Bank is committed to satisfying diverse needs of its customers through an array of products at a competitive price by using appropriate technology and providing timely service so that a sustainable growth, reasonable return and contribution to the development of the country can be ensured with a motivated and professional work-force.

 

2.04 Marketing Strategies of Rupali Bank

 

To attain the above vision and mission Rupali Bank follow the following Marketing Strategies:

 

1        The main strategy of the bank is using Rupali Banking System to attract its market.

2        Providing efficient customer service

3        Maintaining corporate and business ethics

4        Being trusted repository of customers’ and their financial advices

5        Making its products superior and rewarding to the customers

6        Display team spirit and professionalism

7        Sound capital base

8        Enhancement of shareholders wealth

9        Fulfilling its social commitments by expanding its charitable and humanitarian activities

10    Providing high quality financial services in export and import trade.

11    Building tight personal relationship with customers and clients

 

2.05 Objectives of Rupali Bank

RBL is always ready to maintain the highest quality of services by upgrading banking technology prudence in management and by applying high standard of business ethic through its established commitment and heritage.

  • RBL is committed to ensure its contribution to national economy by increasing its profitability through professional and disciplined growth strategy for its customer and by creating corporate culture in international banking area.
  • The objective of RBL is not only to earn profit but also to keep the social commitment and to ensure its co-operation to the person of all level, to the businessman, industrialist specially who are engaged in establishing large scale industry by consortium and the agro-based export oriented medium & small scale industries by self inspiration.
  • RBL is committed to continue its activities in the new horizon of business with a view to developing service oriented industry and culture of morality and its maintenance in banking.
  • RBL has been working from its very beginning to ensure the best use of its creativity, well disciplined, well managed and perfect growth.
  • RBL is always pre-occupied to encourage the inventors for purchasing its share by creating the opportunity of long-term investment and increasing the value of share through prosperity as developed day by day.

 

Goals of Rupali Bank

  • The goal of Rupali Bank ltd is not only to earn profit but also to keep the social commitment and to ensure its cooperation to the person of all level, to the businessman, industrialist specially who are engaged in establishing large scale industry by consortium and the agro-based export oriented medium and small scale industries by self inspiration.
  • Rupali Bank ltd is always ready to maintain the highest quality of services by upgrading banking technology prudence in management and by applying high standard of business ethic through its established commitment and heritage.
  • Rupali Bank ltd is committed to ensure its contribution to national economy by increasing its profitability through professional and discipline growth strategy for its customer.

 

 

2.06 Feature of Rupali Bank

 

There are so many reasons behind the better performance of Rubali Bank ltd than any other newly established banks.

 

  • Highly qualified and efficient professionals.
  • Rupali Bank ltd has established a core Research & Planning Division comprising skilled person from the very inception of the Bank.
  • Rupali Bank ltd has become a member of SWIFT system to expedite foreign exchange transaction.
  • The inner environments of the all branches of Rupali Bank ltd have been computerized to provide the promptly & frequently customer services.
  • Rupali Bank ltd provides the attractive interest rate than the other financial bank.
  • The bank provides loan to the customers @ lower interest rate with easy and flexible condition than the others do.
  • Profit earning is not the main aim of the Rupali Bank ltd the bank is responsible to maintain the social duties.
  • The bank frequent arranges customers meeting to achieve their valuable suggestions.
  • Letter of Credit (L/C) commission and other change are very lower than the others bank.

 

 

Nature of Deposit number of Account of Zingera Branches.

 

Nature of Deposit
01 Current Account
02 Savings Account
03 Term Deposit
04 Deposit Under different Scheme
05 Sundry Deposit AC
06 Foreign Currency Deposit
07 Pension account

 

 

Management of Rupali Bank:

For any financial and non-financial organization, Management is the most valuable and important resources of any kind of organization. And, a well-organize management provides the organization to reach its ultimate goal. Management means planning, organizing, staffing, directing and controlling of all financial and non-financial resources of an organization.

 

Planning

Rupali Bank ltd has done its planning within the purview of the corporate plan. The overall planning approach in Rupali Bank ltd is top-down. Each branch can plan according to the goal imposed by the corporate level. It doesn’t plan independently. And, Rupali Bank ltd has a planning division. This department is mainly responsible for the overall planning.

 

Organizing

Rupali Bank ltd is organized as per the existing business locations. Each of which is a separate entity. Each unit is responsible for own performance and a Senior Vice President (SVP) followed by Manager Heads each. He is directly responsible for the performance of their unit. Within each branch it is organized functionally.

 

Staffing

The recruitment in Rupali Bank ltd is done in two ways. One as a “Probationary Officer” for the management program and it has a probation period of one year. Another one is non-management level as “Trainee Officers”. Probationary Officer is recruited in officer category and their career path is headed towards different managerial jobs.

 

Directing and controlling

The management approach in Rupali Bank ltd is top-down or authoritative. Information just seeks through lower management layer. Works are designed in such a way that one cannot leave without clearing the tasks as he is assigned for a day. Sitting arrangement in all office is done in a way that the superior can monitor the subordinate all time. Budgeting, rewarding, punishing, etc. are also practiced as control mechanism

Human Resources Practice in Rupali Bank:

Employees are the core resources of any organization. Without them, one cannot run their organization. And, human resources approach is concerned with the growth and development of people toward higher level of competency, creativity and fulfillment. It helps employees become better, more responsible persons, and then it tries to create a climate in which they may contribute to the limits of their improved abilities. It assumes that expanded capabilities and opportunities for people will lead directly to improvements in operating effectiveness. Essentially, the human resources approach means that better people achieve better results.

Recruitment of Rupali Bank:

The set-vice rule of Rupali Bank ltd states the recruitment policy of the bank. In, general the board of directors determines the recruitment policy of the bank from time to time. The minimum entry-level qualification for any official position other than supportive management is a Bachelors degree. However, informally the management prefers a minimum master’s degree for the appointed of probationary officers in the Executive Officer position. The recruitment for entry level positions begins with a formal written test which is conducted and supervised by the Institute of Business Administration, University of Dhaka. After successful completion of the written test, a personal interview is conducted for the successful candidates by a panel of experts comprising of renowned bureaucrats and prominent bankers of the country.

2.07 Organizational structure of Rupali Bank:

Chairman↓

Vice Chairman

↓

Directors

↓

Managing Directors & CEO

↓

Deputy General Manager

↓

General Manager

↓

Assistant General Manager

↓

Senior Principal Officer

↓

Principal Officer

↓

Senior Officer

↓

Provisionary Officer

 

 

 

2.08 Corporate Branch Network:

List of corporate branches:

 

Branch Name Address

 

1. Motijheel Corporate Motijheel, Dhaka-1000
2. Rupali Sadan Corporate Rupali Sadan, Motijheel, Dhaka
3. Local Office Corporate Local Office, Dhaka
4. Ramna Corporate Ramna, Dhaka
5. Foreign Exchange Br. Foreign Exchange, Dhaka
6. Anderkilla ANDERKILLA,CHITTAGONG
7. Purana Paltan Corporate Branch Purana Paltan Corporate Branch, Dhka

 

Corporate mission:

Will become most caring, focused for equitable growth based on diversified deployment of resources, and nevertheless would remain healthy and gainfully profitable bank. Rupali   Bank ltd aims to become one of the leading Banks in Bangladesh by prudence, flair and quality of operations in their banking sector. The bank has some mission to achieve the organizational goals. Some of them are-

 

  • Its   aim       to   ensure   their       competitive   advantages   by       upgrading   banking technology and information system.

o RBL intend to provide better benefits to their customers and good returns to their shareholders.

  • The bank intends to meet the needs of their clients and enhance their profitability by creating corporate culture.
  • Rupali Bank ltd provides high quality financial services to strengthen the well-being and success of individual, industries, and business communities.
  • The bank believes in strong capitalization.
  • It maintains high standard of corporate and business ethics.
  • Rupali Bank ltd extends highest quality of service, which attracts the customers to choose them first.

o   The bank maintains congenial atmosphere for which people are proud and eager to word with Rupali Bank ltd.

  • RBL believes in discipline growth strategy.

Corporate culture:

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

 

2.09 Board of Directors of RBL

 

Sl No. Name Designation
Dr. Ahmed Al-Kabir Chairman
Prof. Mohammed Moinuddin Director
Md. Mahabubur Rahman Hiron Director
Abul Kalam Chowdhury Director
Sheikh Serajul Hoque Farazi Director
Quazi Murshed Hossain Kamal Director
Dr. S. M. Mahfuzur Rahman Director
Advocate Md. Abdus Salam Director
Mr. Amalendu Mukherjee Director
Md. Sayful Islam FCA, FCMA Director
Prof. Syed Ahsanul Alam Director
M. Farid Uddin Managing Director
Enamul Islam Khan Director

2.10 Performance at a glance overal RBL:

 

Total Asset and EPS (Earning per share)

 

Rupali Bank Limited reported unaudited earnings results for the first quarter ended March 31, 2010. For the quarter, the bank reported profit after tax of BDT 113.62 million 1with earnings per share of BDT 9.09 as against net loss of BDT 177.54 million and loss per share of BDT 14.20 for the same period of previous year. Its accumulated loss was BDT 11,995.84 million as of March 31, 2010.

The government of Bangladesh will sell more than three million shares of Rupali Bank Limited in the secondary market.

 

A posting on the Dhaka Stock Exchange suggested that 30, 68,750 shares of Rupali would be brought to the secondary market for trading. On November 24, the government had announced plan to float 24.55% or 28, 57,380 shares of in the market. Investment Corporation of Bangladesh (ICB) would manage the issue for Rupali.

 

 

 

 

 

 

 

SWOT Analysis Of

Rupali Bank ltd

 

 

 

 

 

 

 

 

#S –Denotes Strength

#W –Denotes Weakness

#O –Denotes Opportunity

#T –       Denotes Threat

 

 

 

 

 

2.11 (SWOT) Analysis:

 

SWOT analysis is the detailed study of an organization’s exposure and potential in perspective of its strength, weakness, opportunity and threat. This facilitates the organization to make their existing line of performance and also foresee the future to improve their performance in comparison to their competitors. As though this tool, an organization can also study its current position, it can also be considered as an important tool for making changes in the strategic management of the organization.

So we can say that it is a technique used by the credit officers to evaluate credit proposal submitted by company especially by the production concern. Here,

 

S –        Denotes Strength

W –      Denotes Weakness

O –       Denotes Opportunity

T –       Denotes Threat

  • Strengths:

—    Rupali Bank ltd has already established a favorable reputation in the banking industry of the country. It is one of the leading govt sector commercial banks in Bangladesh. The bank has already shown a tremendous growth in the profits and deposits sector.

—

—    Rupali Bank ltd has provided its banking service with a top leadership and management position. The Board of Directors headed by its Chairman Dr. Ahmed Al-Kabiris a skilled person in business. M. Farid Uddin world is the Managing Director of the bank management team.. The top management officials have all worked in reputed banks and their years of banking experience, skill, and expertise will continue to contribute towards further expansion of the bank.

 

 

 

 

—        Rupali Bank ltd has already achieved a high growth rate accompanied by an impressive profit growth rate in 2004. The number of deposits and the loans and advances are also increasing rapidly.

 

—       Rupali Bank ltd has an interactive corporate culture. The working environment is very friendly, interactive and informal. And, there are no hidden barriers or boundaries while communicate between the superior and the employees. This corporate culture provides as a great motivation factor among the employees.

 

—     Rupali Bank ltd has the reputation of being the provider of good quality services too its, potential customers.

 

  • Weaknesses:

 

—        The main important thing is that the bank has no clear mission statement and strategic plan. The banks not have any long-term strategies of whether it wants to focus on retail banking or become a corporate bank. The path of the future should be determined now with a strong feasible strategic plan.

—        The bank failed to provide a strong quality-recruitment policy in the lower and some mid level position. As a result the services of the bank seem to be Deus in the present days.

__        The poor service quality has become a major problem for the bank. The quality of the service at Rupali Bank ltd is higher than the Dhaka Bank, Prime Bank or Dutch Bangla Bank etc. But the bank has to compete with the Multinational Bank

 

—        Some of the job in Rupali Bank ltd has no growth or advancement path. So lack of motivation exists in persons filling those positions. This is a weakness of Rupali Bank ltd that it is having a group of unsatisfied employees.

 

__        In terms of promotional sector, Rupali Bank ltd has to more emphasize on that. They have to follow aggressive marketing campaign.

 

 

 

 

  • Opportunities:

 

 

 

—         In order to reduce the business risk, Rupali Bank ltd has to expand their business portfolio. The management can consider options of starting merchant banking or diversify into leasing and insurance sector.

 

 

—       The activity in the secondary financial market has direct impact on the primary financial market. Banks operate in the primary financial market. Investment in the secondary market governs the national economic activity. Activity in the national economy controls the business of the bank.

 

—       Opportunity in retail banking lies in the fact that the country’s increased   population is gradually learning to adopt consumer finance. The bulk of our population is middle class. Different types of retail lending products have great appeal to this class. So a wide variety of retail lending products has a very large and easily pregnable market.

 

—     A large number of private banks coming into the market in the recent time. In this competitive environment Rupali Bank ltd must expand its product line to enhance its sustainable competitive advantage.

—       In addition of those things, Rupali Bank ltd can introduce special corporate scheme for the corporate customer or officer who have an income level higher from the service holder. At the same time, they can introduce scheme or loan for various service holders. And the scheme should be separate according to the professions, such as engineers, lawyers, doctors

 

 

  • Threats:

 

—                All sustaining multinational banks and upcoming foreign and private banks pose significant threats to Rupali Bank ltd. If that happens the intensity of competition will rise further and banks will have to develop strategies to compete againstthese local and foreign banks.

 

 

 

—        The default risks of all term loans have to be minimized in order to sustain in the financial market. Because of default risk the organization may become bankrupt. Rupali Bank ltd has to remain vigilant about this problem so that proactive strategies are taken to minimize this problem if not eliminate.

 

—                The low compensation package of the employees from mid level to lower level position is not able to keep the employee motivation. As a result, good quality employees leave the organization and it effects the organization as a whole.

 

Finally we can say that, top management officials have experience skill and proficiency on banking. RBL has gotimpressive decoration, for that it creates the attention of the potential customers. Lovely environment boost up capability of the employees. Besides these RBL has adequate capital, high interest rate for DPS and Savings account and it’s goodwill. For poor employment system, RBL is loosing its reputation. For this reason right people are also not in right place for reference appointment. Another weakness is low interest rate of FDR, for which RBL is loosing their customers. This analyzes the opportunity, which will be available to a company in near future, such as withdraw of tax, incentives, export, exemption and more credit facilities etc. RBL can also adopt diversification strategy in expanding the business line into leasing and insurance company. It analyzes the threats, which may face the company such as international law, withdraw of most favorable nation (MFN) and GSP facilities etc. Some contemporary, multinational and upcoming banks are competitors of RBL. These bank poses threat for RBL. So RBL should take necessary steps to compete with them.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General Banking Activities of Rupali Bank Ltd.

 

 

 

 

 

 

 

 

 

 

3.1 GENERAL BANKING:

 

General banking department is the heart of all banking activities. This is the busiest and important department of a branch, because funds are mobilized, cash transactions are made; clearing, remittance and accounting activities are done here.

Since bank is confined to provide the services everyday, general banking is also known as ‘retail banking’. In Rupali Bank ltd Principal Branch, the following departments are under general banking section:

 

a)      Account opening section

b)      Deposit section

c)      Cash   section

d)     Clearing section

e)      Accounts section

3.2 Our Services:

Deposit Services
Savings Bank Account
Fixed Deposit Account
Short Term Deposit Account
Current Account
Pension Account
Foreign Currency Account
Loans & Lease Services
Micro Credit
Small and Medium Enterprise Financing
Industrial Loans
Working Capital Financing
Export Credit
Import Credit
Bills Purchase
Letter of Credit
Letter of Guarantee
Lease Financing
Transport Financing
Consumers Loan Scheme
House Building Loans
Miscellaneous Services
Electric Bill
Gas Bill
Phone Bill
Cheque Clearing
Instrument Collection
Locker Services

Remittance Services
Remittance of Fund from abroad by Bangladeshi Nationals
Foreign Remittance
Internal Remittance

3.03 Accounts Opening Section:

 

Account opening is the gateway for clients to enter into business with bank. It is the foundation of banker customer relationship. This is one of the most important sections of a branch, because by opening accounts bank mobilizes funds for investment. Various rules and regulations are maintained and various documents are taken while opening an account. A customer can open different types of accounts through this department. Such as:

1. Current Account.

2. Savings account.

3. Fixed Deposit

4. Short Term Deposit (STD)

5. Cash credit (CC)

►Types Of Accounts With Terms And Conditions:

 

Current Account:

 

Current account is purely a demand deposit account. There is no restriction on withdrawing money from the account. It is basically justified when funds are to be collected and money is to be paid at frequent interval.

Some Important Points are as follows-

 

vMinimum opening deposit of TK.5000/- is required, but under special circumstances it may be opened with tk.1000.

vThere is no withdrawal limit.

vNo Interest more or less is given upon the deposited money;

vProfit rate is 0.00%.

Savings Account:

 

This deposit is primarily for small-scale savers. Hence, there is a restriction on withdrawals in a month. Heavy withdrawals are permitted only against prior notice. Some Important Points are as follows-

 

vMinimum opening deposit of Tk.1000/= is required;

vWithdrawal amount should not be more than 1/4th of the total balance at a time and limit twice in a month.

vIf withdrawal amount exceed 1/4th of the total balance at a time no Profit more or less is given upon the deposited money for that month.

 

  • Fixed Deposit:

 

The Local Remittance section of Rupali Bank ltd also issues FDR.They are also known as time deposit or time liabilities. These are deposits, which are made with the bank for a fixed period, specified in advance. The bank need not maintain cash reserves against these deposits and therefore, the bank offers higher of Profit more or less on such deposits.

 

  • Opening of fixed Deposit Account:

The depositor has to fill an account form where in the mentions the amount of deposit, the period for which deposit is to be made and name/names is which the fixed deposit receipt is to be issued. In case of a Joint name Rupali Bank ltd also takes the instructions regarding payment of money on maturity of the deposit. The banker also takes specimen signatures of the depositors. A fixed deposit account is then issued to the depositor acknowledging receipt of the sum of money mentioned there. It also contains the rate of Profit more or less and the date on which the deposit will fall due for payment.

 

Term Deposits:

These rates are not negotiable. In this table we can find out the percentage that is given by the bank for specific period of time to the customer.

 

STD (Short Term Deposit) Account:

 
Normally various big companies, organizations, Government Departments keep money in STD account. Frequent withdrawal is discouraged and requires prior notice. The deposit should be kept for at least seven days or thirty days to get Profit more or less. The Profit more or less offered for STD is less than that of savings deposit.

 

 

 

 

 

 

 

 

 

 

All are Interest Rates

 

SL No. Types of Deposit Interest Rate per annum
Savings Deposit 4.50%
Short Notice Deposit 3.50%
Time Deposits
a) 3 months & above but less than 6 months
b) 6 months & above but less than 1 year
c) 1 year & above but less than 2 years
d) 2 years & above but less than 3 years
7.50%
7.75%
8.00%
8.50%
Deposit From foreign Remittance 6.00%
Rupali Bank Deposit Pension-Scheme 2 6.50%

 

 

* The rates of interest are changeable from time to time depending upon market competition.

 


Dishonor of Cheque:

If the Cheque is dishonored, RBL sends a memorandum (Cheque returns memo) to the customer stating the reason in the following way,

 

¨    Refer to drawer

¨    Not arranged for

¨    Effects not cleared. May be presented again.

¨    Exceed arrangements

¨    Full cover not received.

¨    Payment stopped by drawer

¨    Payee’s endorsement irregular/ required.

¨    Payees endorsement irregular, require banks confirmation.

¨    Drawer’s signature differs/ required.

¨    Alterations in date/figures/words require drawer’s full signature.

¨    Cheque is post dated/ differs.

¨    Crossed Cheque must be presented through a bank.

¨    Clearing stamp required/ requires cancellation.

¨    Addition to bank discharge should be authenticated.

¨    Cheque crossed “account payee only”

¨    Collecting bank discharge out of date/ mutilated.

¨    Amount in words and figures irregular/required.


► Account Opening procedure:

Step 1 The account should be properly introduced by Any one of the following:

  • An existing Current Account holder of the Bank.
  • Officials of the Bank not below the rank of an Assistant officer.
  • A respectable person of the locality well known to the Manager/Sub-Manager of the Branch concerned.
Step 2 Receiving filled up application in bank’s prescribed form mentioning what type of account is desired to be opened.
Step 3
  • The form is filled up by the applicant himself / herself
  • Two copies of passport size photographs from individual are taken, in case of firms photographs of all partners are taken
  • Applicants must submit required documents
  • Application must sign specimen signature sheet and give mandate
  • Introducer’s signature and accounts number – verified by legal officer.
Step 4 Authorized Officer accepts the application.
Step 5 Minimum balance is deposited – only cash is accepted.
Step 6 Account is opened and a Cheque book and pay-in-slip book is given.

 

 

►Documents required for opening account

    

□   Individual / Joint Account:

 

  1. Introduction of the account.
  2. Two photographs of the signatories duly attested by the introducer.
  3. Photo Identity.
  4. Joint Declaration Form (For joint a/c only).
  5. Employee’s Certificate (in case of service holder).

 

 

□   Partnership account:

 

  1. Introduction of the account.
  2. Two         photographs of the signatories duly attested by the introducer.
  3. Partnership letter duly signed by all partners (Sign should be similar as stated in Partnership Deed).
  4. Partnership Deed duly certified by Notary public.
  5. Registration (If any).
  6. Resolution of meeting for opening an account.
  7. Updated Trade license.

 

□   Proprietorship account:

 

  1. Introduction of the account.
  1. Two         photographs of the signatories duly attested by the introducer.
  2. Valid copy of Trade License.
  3. Rubber stamp.
  4. TIN number certificate.
  5. Photo Identity.

 

□   Limited company:

 

  1. Introduction of the account.
  2. Two photographs of the signatories duly attested by the Introducer.
  3. Valid copy of Trade License.
  4. Board resolution of opening A/C duly certified by the Chairman/Managing Director.
  5. Certificate of Incorporation.
  6. Certificate of Commencement (In case of Public limited company).
  7. Certified (joint stock) true copy of the Memorandum and Article of Association of the Company duly attested by Chairman or Managing Director.
  8. List of directors along with designation & specimen signature.
  9. Latest certified copy of Form – xii (to be certified by register of joint stock companies) (In case of Directorship change).

 

 

  1. Rubber Stamp (Seal with designation of each person)
  2. Certificate of registration (In case of Insurance Company – Obtained from department of Insurance from the Peoples Republic of BD).

 

□   Club / societies account:

 

  1. Introduction of the account.
  2. Two photographs of the Signatories duly attested by the introducer.
  3. Board Resolution for Opening A/C duly certified by President/ Secretary.
  4. List of Existing Managing Committee.
  5. Resolution of meeting for opening an account.
  6. Registration (if any).
  7. Rubber Stamp.
  8. Permission letter from Bureau of N.G.O. (In case of N.G.O. A/C).

 

 

►Closing of an account:

 

Theclosing of an account may happen,

 

q  If the customer is desirous to close the account,

q  If the Rupali Bank ltd finds that the account is inoperative for a long duration.

q  If the Rupali Bank ltd get garnishee order from court.

 

A customer may close his/her account any time by submitting an application to the branch. The customer should be asked to draw the final check for the amount standing to the credit of his/her account less the amount of closing an other incidental charge and surrender the unused check leaves. The account should be debited for the account closing charge etc. and the authorized officer of the bank should destroy unused check. In case of joint account the application for closing the account should be signed by the joint account holder. The fee for closing of an account is Tk.100).

 

►Special Savings Scheme:

Savings helps to build up capital and capital is the prime source of business investment in a country. Investment takes the country towards industrialization, which eventually creates wealth. That is why savings is treated as the very foundation of development. To create more awareness and motivate people to save, Rupali Bank ltd offers Special Savings Scheme.

The schemes are:

 

 

 

 

 

                                  

                                             (Youth and Farmer Loan )

 

# No charge no fee…

# Fixed member must be 18-35 years old

# must have a account on this branch

# 200,000**taka the highest provided but in group 50, 00000**are provided but liean must have

# Interest rate 10% and 2 years payable

 

 

(SME Loan)

 

# It’s classifying under 4 categories this are:

 

1/ Shohoj Rin (2 lack only)

2/ Sholob Rin (5 lack only)

3/ business Rin (3 core only)

4/ medium Rin (3-20 core only give the loan)

 

(Student Loan)

 

 

# 12 lacks only for study loan but not payable

# 13% interest rate only for 3 month (changeable)

 

( Rupali Monthly Earning Scheme)

# The time of 3-5 years

# Interest rate for 3 years 8% and for 5 years 8.50%

# 80% advance loan are taken depositor against liean

 

 

 

 

 

 

 

3.04 Loan & Advance:

 

After two years of savings in this scheme the depositor (if an adult) is eligible for a loan up to 80%of his deposited amount. In that case, Profit more or less rates on the loan will be applicable as per prevailing rate at that time. Only Tk/-200 will be collect for service charge.


Reason for disqualification from this scheme:

 

  1. If the depositor fails to pay 3 installments in a row, then he will be disqualified from this scheme and Profit more or less will be applicable as mentioned in withdrawal clause.
  2. In case of death of the depositor the scheme will mark deceased to function. The amount will be handed over to the nominee of the deceased depositor. In case of absence of the nominee the bank will handover the accumulated amount to the successor of the deceased

 

Objectives:

  1. An account is to be opened by filling up a form.
  2. The Bank will provide to the customer a deposit receipt after opening the account. This receipt is non-transferable.
  3. If the deposit is withdrawn before maturity term, then saving rate of profit will be applicable and paid to the depositor. However, no profit will be paid if the deposit is withdrawn within six months of opening the account and monthly income paid to the customer will be adjusted from the principal amount.
  4. A depositor can avail loan/quard up to 80% of the deposit amount under this scheme. In this case, profit will be charged against the loan, the monthly income will be credited to the loan account until liquidation of the loan amount inclusive of profit.

 

3.05 Deposit Section:

Deposit is the lifeblood of a bank. From the history and origin of the banking system

We know that deposit collection is the main function of a bank.

 


Accepting deposits

 

The deposits that are accepted by Ruplai Bank ltd like other banks may be classified in to,

 

a) Demand Deposits

b) Time Deposits

 

Demand deposits:

 

These deposits are withdrawn able without notice, e.g. current deposits. Rupali Bank ltd accepts demand deposits through the opening of –

 

a) Current account

b) Savings account

c) Call deposits from the fellow bankers

 

Time deposits:

 

A deposit which is payable at a fixed date or after a period of notice is a time deposit. Rupali Bank ltd accepts time deposits through Fixed Deposit Receipt (FDR), Short Term Deposit (STD).

 

While accepting these deposits, a contract is done between the bank and the customer. When the banker opens an account in the name of a customer, there arises a contract between the two. This contract will be valid one only when both the parties are competent to enter into contracts. As account opening initiates the fundamental relationship & since the banker has to deal with different kinds of persons with different legal status, Rupali Bank ltd officials remain very much careful about the competency of the customers.

 


3.06 Cash section:

 

Banks, as a financial institution, accept surplus money from the people as deposit and give them opportunity to withdraw the same by cheque, etc. But among the banking activities, cash department play an important role. It does the main function of a commercial bank i.e. receiving the deposit and paying the cash on demand. As this department deals directly with the customers, the reputation of the bank depends much on it. The functions of a cash department are described bellow:

 

Functions of Cash Department

 

Cash Payment
  1. Cash payment is made only against cheque
  2. This is the unique function of the banking system which is known as “payment on demand”
  3. It makes payment only against its printed valid Cheque
Cash Receipt
  1. It receives deposits from the depositors in form of cash
  2. So it is the “mobilization unit” of the banking system
  3. It collects money only its receipts forms

 

 

□ Cash packing:

 

After the banking hour cash is packed according to the denomination. Notes are counted and packed in bundles and stamped with initial.

 

□ Allocation of currency:

 

Before starting the banking hour all tellers give   requisition of money through   “Teller cash proof sheet”. The head teller writes the number of the packet denomination wise in “Reserve sheet” at the end of the   day, all the notes remained are recorded in the sheet.

 

 

3.07 Local Remittance:

Carrying cash money is troublesome and risky. That’s why money can be transferred from one place to another through banking channel. This is called remittance. Remittances of funds are one of the most important aspects of the Commercial Banks in rendering services to its customers.

 

Types of remittance:

 

 

  • Between banks and non banks customer
  • Between banks in the same country
  • Between banks in the different centers.
  • Between banks and central bank in the same country
  • Between central bank of different customers.

 

The main instruments used by the Rupali Bank ltd of remittance of funds are:

 

 

  • Payment order ( PO)
  • Demand Draft ( DD)
  • Telegraphic Transfer (TT)

 

 

 

The basic three types of local remittances are discussed below

 

Points Pay Order Demand Draft TT
Explanation Pay Order gives the payee the right to claim payment from the issuing bank Demand Draft is an order of issuing bank on another branch of the same bank to pay specified sum of money to payee on demand. Issuing branch requests another branch to pay specified money to the specific payee on demand by Telegraph /Telephone
Payment from Payment from issuing branch only Payment from ordered branch Payment from ordered branch

 

 

Generally used to Remit fund Within   the clearinghouse area of issuing branch. Outside the clearinghouse area of issuing branch. Payee can also be the purchaser. Anywhere in the country
Payment Process of the paying bank Payment is made   through clearing 1. Confirm that the DD is not forged one.2.Confirm with sent advice

3.Check the ‘Test Code’

4.Make payment

 1.Confirm issuing branch2.Confirm Payee A/C

3.Confirm amount

4.Make payment

5.Receive advice
Charge Only commission Commission + telex charge Commission     +telephone

 

 

 

 

 

 

Test – key Arrangement:

Test key arrangement is a secret code maintained by the banks for the authentication for their telex messages. It is a systematic procedure by which a test number is and the person to whom this number is given can easily authenticate the same test number by maintaining that same   procedure. Rupali Bank ltd has test key arrangement with so many banks for the authentication of LC message and for making payment.

 

Commission for PO:

Rupali Bank ltd charges different amount of commission on the basis of Payment order at. The bank charges for pay order are given in the following chart:

Total amount of PO Commission VAT
Up to TK. 10,000.00 TK. 15.00 Tk.3
TK. 10,001.00 – TK.1,00,000.00 TK. 25.00 Tk. 4
TK. 1,00,001.00 – TK. 5,00,000.00 TK. 50.00 Tk. 8

 

 

3.08 bill and Clearing Section:

 

 

Cheque, Pay Order (P.O), Demand Draft (D.D.) Collection of amount of other banks on behalf of its customer is a basic function of a Clearing Department.

 

  • Clearing: Clearing is a system by which a bank can collect customers fund from one bank to another through clearing house.

 

  •  

 

  • Clearing House: Clearing House is a place where the representatives of different banks get together to receive and deliver cheque with another banks.

 

  • Member of Clearing House: Rupali Bank ltd. is a scheduled Bank. According to the Article of Bangladesh Bank Order, 1972, the banks, which are the member of the clearinghouse, are called as Scheduled Banks. The scheduled banks clear the cheque drawn upon one another through the clearinghouse.

 

·         Types of Clearing:

 

A)    Outward Clearing: When the Branches of a Bank receive Cheque from its customers drawn on the other Banks within the local clearing zone for collection through Clearing House, it is Outward Clearing.

 

B)    Inward Clearing: When the Banks receive Cheque drawn on them from other Banks in the Clearing House, it is Inward Clearing.

 

  • Types of clearing house: There are three types of clearing house: Those are

1) Normal clearing house

2) Same day clearing house

3) Special Clearing House

 

 

Normal clearing house:

1)      1st house: 1st house normally stands at 10 a.m. to 11a.m

2)      2nd house: 2nd house normally stands after 3 p.m. and it is known as return house.

 


Same day clearing house:

1)      1st house: 1st house normally stands at 11 a.m. to 12 pm

2)      2nd house: 2nd house normally stands after 2 p.m. and it is known as return house.

 

Special clearinghouse:

3)      1st house : 1st house normally stands at 11 a.m. to 12 pm

3)      2nd house: 2nd house normally stands after 7 p.m. and it is known as return house.

(Special clearing generally held on yearly, half yearly closing of Bank and sometimes Eid-ul Fatr and Eid Ul Azha)

  • Who will deposit cheque for Clearing: Only the regular customers i.e. who have Savings, Current, STD & Loan Account in the bank can deposit cheque for collection of fund through clearing house.

 

  • Precaution at the time of Cheque receiving for Clearing, Collection of LBC, OBC & Transfer:

 

1) Name of the account holder same in the Cheque & deposit slip.

2) Amount in the Cheque & deposit slip must be same in words & in figure

3) Date in the Cheque may be on or before (but not more than six months back) clearing       house date.

4) Bank & Branch name of the Cheque, its number & date in the Deposit slip.

5) Cheque must be signed.

6) Signature for confirmation of date, amount in words / in figure Cutting &

Mutilation of Cheque.

7) Cheque should be crossed (not for bearer Cheque).

8) Account number in the deposit slip must be clear.

9) Depositor’s signature in the deposit slip.

Cheque may be dishonored for any one of the following reasons:

 

1)    Insufficient fund.

2)    Amount in figure and word differs.

3)    Cheque out of date/ post- dated.

4)    Payment stopped by the drawer.

5)    ………….Payee’s endorsement irregular / illegible / required.

6)    Drawer’s signature differs / required.

7)    Crossed Cheque to be presented through a bank.

8)    Other specific reasons not mentioned above.

The dishonor Cheque entry in the Return Register & the party is informed about it. Party‘s signature required in the return register to deliver the dishonor Cheque. After duration, the return Cheque is sent to the party’s mailing address with Return Memo.

 

 

Responsibility of the concerned officer for the Clearing Cheque:

  

1)      Crossing of the Cheque.

2)      (Computer) posting of the Cheque.

3)      Clearing seal & proper endorsement of the Cheque.

4)      Separation of Cheque from deposit slip.

5)      Sorting of Cheque 1st bank wise and then on branch wise.

6)      Computer print 1st branch wise & then bank wise.

7)      Preparation of 1st Clearing House computer validation sheet.

8)      Examine computer validation sheet with the deposit slip to justify the computer posting

9) Copy of computer posting in the floppy disk.

 

Bills   Collection:

In modern banking the mechanism has become complex as far as smooth transaction and safety is concerned. Customer does pay and receive bill from their counterpart as a result of transaction. Commercial bank’s duty is to collect bills on behalf of their customer.

           Types of Bills for Collection

 

  1. Outward Bills for Collection (OBC).
  2. Inward Bills for Collection (IBC).

 

Outward Bill for collection OBC:

 

OBC means Outward Bills for Collection .OBC exists with different branches of different banks outside the local clearinghouse. Normally two types of OBC:

 

1)      OBC with different branches of other banks out of clearing house.

 

2)      OBC with different branches of the same bank.

 

 

 

Procedure of OBC:

 

1)      Entry in the OBC register.

2)      Put OBC number in the Cheque.

3)      “Crossing seal” on the left corner have the Cheque & “payees account will be credited on realization “seal on the back of the Cheque with signature of the concerned officer.

4)      Dispatch the OBC Cheque with forwarding.

5)      Reserve the photocopy of the Cheque, carbon copy of the forwarding and deposit slip of the Cheque in the OBC file.

 

 

 

Inward bills for collection (IBC):

 

When the banks collect bills as an agent of the collecting branch, the system is known as IBC. In this case the bank will work as an agent of the collection bank. The branch receives a forwarding letter and the bill.

 

Procedure of IBC:

 

  1. IBC against OBC: To receive the OBC Cheque first we have to give entry in the IBC Register .The IBC number should put on the forwarding of the OBC with date.
  2. Deposit of OBC amount: OBC Cheque amount is put into the “sundry deposit-sundry Creditors account”, prepare debit & credit voucher of it. If the OBC Cheque is honored, send credit advice (IBCA) with signature & advice number of the concern branch for the OBC amount.
  3. If the OBC Cheque is dishonored, the concerned branch is informed about it.
  4. Again place in the clearing house or send the OBC Cheque with Return Memo to the issuing branch according to their information.

 


3.09 Accounts Section:

 

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

 

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

 

Workings of this department:

 

 

  • Recording the transactions in the cashbook.

 

  • Recording the transactions in general and subsidiary ledger.

 

  • Preparing the daily position of the branch comprising of deposit and cash.

 

  • Preparing the daily Statement of Affairs showing all the assets and liability of the branch as per General Ledger and Subsidiary Ledger separately.

 

  • Making payment of all the expenses of the branch.

 

  • Recordings inter branch fund transfer and providing accounting treatment in this regard.

 

o   Preparing the monthly salary statements for the employees.

 

o   Preparing the weekly position for the branch which is sent to the Head Office to maintain Cash Reserve Requirement (C.R.R)

 

o   Preparing the monthly position for the branch, which is sent to the Head Office to maintain Statutory Liquidity Requirement (S.L.R)?

o   Preparing the budget for the branch by fixing the target regarding profit and deposit so as to take necessary steps to generate and mobilize deposit.

 

o   Checking of Transaction List

 

  • Recording of the vouchers in the Voucher Register.

 

  • Packing of the correct vouchers according to the debit voucher and the credit voucher.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Service Level & Customer Satisfaction

 

 

 

 

 

 

 

 

 

 

 

4.0   Service Level & Customer Satisfaction:

 

4.1     The Process of measuring the Satisfaction:

 

The satisfaction is an abstract task. The state of satisfaction of the Customers has been measured under some criteria. The criteria are given below.

 

  1. The Bankers can understand and realize the Customers’ Problem properly and accurately.

 

  1. The Bankers can solve the Customers’ Problem quickly and properly.

 

  1. The Bankers are very friendly and helpful to the Customers

 

  1. The Bank has wide spread Service Facility and Link

 

  1. The Customers can receive the Services from very close to their House and Business Outlet.

 

  1. The Phone Link has increased the Service Level of this Bank to great extent

 

  1. How much the Customers are satisfied with the overall Service of the Bank

 

  1. The Bankers provide Sufficient Information about their Product and Information necessary to the Customers

 

 

The respondents expressed their answer in a 5 point grading scale. Any point close to 5(five) indicates the higher satisfaction of the Customer about the criteria and any point close to 1(one) indicates the dissatisfaction of the Customer regarding the criteria.

 

 

A total of 25 respondents expressed their views. The maximum number under each criterion is 125 (25 x 5). The state of Service Level of the Bank in terms of the satisfaction of the Customers is expressed in the points—————-

 

  1. Very Good                         Total Score ——- (115 to 125)     (Out of 125)

 

  1. Good                                   Total Score ——- (115 to 125)     (Out of 125)

 

  1. Satisfactory                      Total Score ——- (115 to 125)     (Out of 125)

 

  1. Moderate/Average          Total Score ——- (115 to 125)     (Out of 125)

 

  1. Poor                                                Total Score ——- (115 to 125)     (Out of 125)

 

So the Service Level of the Bank has been expressed in these 5(five) points.

These 5(five) points stands for some special meaning and explanation. The statements that stand with these points are given below.

 

 

  1. Very Good:

 

The Service Level is very high quality. The Bank enjoyed a huge advantage in this regard. This will help the Bank to get more Customers and maintain a warm relation with them. The Bank is really getting benefit from this type of Service while maintaining the highly satisfaction from the Customers point of view. So it can be ranked as High-quality Service.

 

 

 

 

 

  1. Good:

 

The Service is competitive in the Banking Business Market and is one of the strong points for the Bank. The Customers are satisfied in an acceptable way for the Service provided by the Bank. The Bank enjoys some advantage in this regard of the Service, which helps the Bank to create new Customers and maintain well relation with the existing ones.

 

 

  1. Satisfactory:

 

The Bank is doing well in the regard of this Service. But it is not a strong point for the Bank. The Bank does not enjoy any advantage over other Banks in this regard. The Customers are satisfied but do not have much positive impression for this Service of the Bank. The Bank needs to improve the Level of this Service in order to gain comparative advantage to other Bank.

 

 

  1. Moderate/Average:

 

The Service Level is very ordinary. It is considered as one of the vulnerable point of the Bank. The other Banks can easily enjoy superiority over this Bank in regard of this Service attract the attention of the Customers to their respective Banks. The Bank really needs to improve this regard as the Customers are not satisfied with the Service.

 

 

 

 

 

 

  1. Poor

 

The Service is really worst and the Customers are quite dissatisfied in this regard. It is a real disadvantage and weak point for the Bank. In order to maintain the Customers loyalty to the Bank, the Bank needs to improve this Service with no delay. If the Bank fails to improve this sector, there is a great possibility that the Bank will loose a huge cluster of its present Customers and lag behind in the competitive market.

 


4.2 General Opinion of the Customers

 

Of the Banking Service provided by various Private Commercial Banks and Public Commercial Banks the Customers can distinguish some Unique Quality and Advantages for making and managing their Banking Relation with Bank. The Advantages that they feel while maintaining the Banking Relation with this Bank are as follows:

 

  1. The Bank is more secured in terms of Banking Transaction and keeping Money here

 

  1. The Bank has wide access and huge range of Service offerings

 

  1. The Atmosphere of the Bank is more attractive than other Banks

 

  1. The Bank can provide them prompt Service

 

  1. The Bankers are very friendly to the Customers

 

  1. Even the Banking Transaction through this Bank is reliable, trustworthy and smooth to various Organizations within the country or abroad.

 

 

According to the Customers there are also some short comings. They are:

 

  1. The Bank takes high Charges for their Service in some areas of Banking Operations than that of the Nationalized Commercial Banks.

 

  1. Even sometimes they are not aware of various Charges for the Products and Services provided by the Bank.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comparative Analysis

 

 

 

 

 

 

 

 

 

 

 

 

5.1. Liquidity Ratio:

 

  1. Current Ratio
Year RBL PBL
2008 0.89 0.88
2009 1.17 0.98
2010 1.11 1.07

Table: 14 Current Ratio

Source: Annual Report of RBL & Pubali Bank Limited (PBL) (2008, 2009, 2010)

 

 

Graphical Presentation:

Figure: 16 Current Ratio

 

Interpretation:

We know that, the current ratio measures a firm’s liquidity by measuring the portion of its current asset relative to its current liabilities and the higher the ratio, the higher the liquidity of the firm. The graph shows that, in 2008, current ratio of RBL and PBL were almost same but RBL current ration was better than PBL in 2009 and 2010 respectively 1.17 and 1.11. In 2010, RBL’s current ratio reduced at 1.11. So it can be said that, lower the current ratio, the lower the ability of the firm to pay its bills.

 

 

 

 

 

5.2. Activity Ratio

 

  1. Total Asset Turnover
Year RBL PBL
2008 0.071 0.053
2009 0.083 0.066
2010 0.066 0.089

Table: 15 Total Asset Turnover

Source: Annual Report of RBL & PBL (2008, 2009, 2010)

 

 

Graphical Presentation:

Figure: 17 Total Asset Turnover

 

 

Interpretation:

We know greater the total asset turnover; it is more efficient and 4 to 6 times is standard position. The graph shows that, the total asset turnover ratio of RBL was more than PBL in 2008 and 2009 but PBL has generated maximum level of turnover in year 2010 comparison with RBL It can be said that PBL was more efficiently use its assets to generate income.

 

 

 

 

 

5.3. Debt Ratio:

 

  1. Debt Ratio
Year RBL PBL
2008 97.92% 94.30%
2009 96.36% 97.72%
2010 88.63% 89%

Table: 16 Debt Ratio

Source: Annual Report of RBL & PBL (2008, 2009, 2010)

 

 

Graphical Presentation:

Figure: 18 Debt Ratio

 

 

Interpretation:

Every organization should give more emphasize on equity capital than debt capital. From the graph it has been that the RBL debt ratio was decreasing year by year. In case of PBL, its debt fluctuated over three years but in 2010 two banks’ debt ratio reduced from previous two years that means two banks took more steps on debt capital to reduce its risky.

 

 

5.4  Profitability Ratio:

 

  1. Net Profit Margin
Year RBL PBL
2008 14.94% 21%
2009 23.04% 19.62%
2010 7.27% 25.20%

Table: 18 Net Profit Margin

Source: Annual Report of RBL & PBL (2008, 2009, 2010)

 

 

Graphical Presentation:

Figure: 20 Net Profit Margin

 

Interpretation:

The graph shows that, in 2010 net profit margin of RBL was so lower i.e. 7.27% but on the other hand PBL’s net profit margin was more than RBL i.e. 25.20% and over three years RBL and PBL’s net profit margin fluctuated. The higher the firm’s net profit margin, the better. So RBL should emphasis to increase its net profit margin.

 

 

 

 

  1. Return on Asset (ROA)
Year RBL PBL
2008 0.46% 1.54%
2009 1.17% 1.94%
2010 1.15% 2.44%

Table: 19 Return on Asset (ROA)

Source: Annual Report of RBL & PBL (2008, 2009, 2010)

 

 

Graphical Presentation:

Figure: 21 Return on Asset (ROA)

 

Interpretation:

After having a careful view on the graph, PBL had maximum return on asset than RBL over three years that means PBL remains more efficient to generate additional ROA than RBL. In 2009, RBL earned 1.17% on each taka of asset investment where PBL earned 1.94% on each taka. But in 2010 RBL’s return on asset silently decreased i.e. 1.15% than 2009 it is not a good sign for a bank, in this year PBL’s return on asset was 2.44%. So the higher the firm’s return on total assets, the better.

 

 

 

 

 

 

 

  1. Return on Equity (ROE)
Year RBL PBL
2008 10.70% 18.62%
2009 29.89% 22%
2010 4.24% 22.48%

Table: 20 Return on Equity (ROE)

Source: Annual Report of RBL & PBL (2008, 2009, 2010)

 

 

Graphical Presentation:

Figure: 22 Return on Equity (ROE)

 

Interpretation:

We know that the ROE means return earned from the owner’s investments. The graph shows that, RBL’s return on equity was fluctuating over three years. In 2009 RBL’s return on equity was in better than PBL at 29.89% but in 2010, RBL’s return was very poor on equity i.e. 4.24% where PBL earned more from the owner’s investments than RBL i.e. 22.48%. Generally, the higher this return, the better off is the owners.

 

 

 

 

 

 

 

 

 

  1. Investment to Deposit Ratio
Year RBL PBL
2008 0.178 0.222
2009 0.196 0.186
2010 0.175 0.167

Table: 21 Investment to Deposit Ratio

Source: Annual Report of RBL & PBL (2008, 2009, 2010)

 

 

Graphical Presentation:

Figure: 23 Investment to Deposit Ratio

 

Interpretation:

As we know that the ratio measures the bank’s efficiency in promoting its investment products the customer and in using its funds collected from the customers to by measuring the percentage of total deposit that the bank has disbursed as loan and advances and the higher the ratio the higher the banks efficiency and vice-versa. The graph shows that, RBL’s investment remained in better position than PBL last two years that means RBL increased its deposit investment. It is a good sign.

 

 

 

 

  1. Earning Per Share (EPS) (Assume face value 100tk per share)
Year RBL PBL
2008 69.93(tk.) 350(tk.)
2009 133.48 42.1
2010 48.02 65.1

Table: 22 Earning Per Share (EPS)

Source: Annual Report of RBL & PBL (2008, 2009, 2010)

 

 

Graphical Presentation:

 

 

 

 

 

 

 

 

 

 

 

Figure: 24 Earning Per Share (EPS)

 

Interpretation:

As we noted earlier, the number of taka earned during the period on behalf of each outstanding share of common stock. From this graph it has been that, RBL’s earning per share was in better position then PBL in 2009 but in 2010 RBL’s earning per share decreased more than 2009 which is not a good sign where PBL’s earning per share increased. Comparison between two banks it can see that RBL and PBL’s earning per share were fluctuating over three years.

 

 

 

 

 

 

 

 

Major Findings

 

 

 

 

 

 

 

 

 

 

 

6.1 Major Findings

 

dFrom the analysis it has seen that Rupali Bank Ltd (RBL) Financial performance was not better than other bank such as Pubali Bank Ltd. (PBL) except in some cases.

 

dFrom the current ratio analysis it has seen that in last two years RBL had enough current assets to pay its short term obligations. But in 2010 the current ratio was decreased silently than 2009.

 

dForm the net working capital analysis it can be seen that in 2009 and 2010 RBL’s had enough working capital to meet up its current obligations but in 2010 its net working capital went down amount than 2009 that is bad sign for RBL.

 

dFrom the trend analysis it has seen that RBL’s total asset turnover was fluctuating year by year. But in 2010 total asset turnover was lower than previous three years. It indicates Negative operating efficiency of RBL.

 

dDebt Ratio RBL was in satisfactory range because in 2010 it was decreased more than last three years.

 

dFrom the trend analysis RBL’s operating profit margin was increasing year by year. It is a good sign for the bank.

 

dFrom the trend analysis it have seen that RBL’s net profit margin was increasing except 2010 because in 2010 bank’s net profit margin was reduced more from previous three years. It indicates negative operating result of RBL.

 

dIn 2010 the investment to deposit of the RBL decreased from previous three years. This is not a good sign for the bank.

 

dFrom the analysis it has been that RBL’s earning per share was not in better than PBL except 2009 which indicates not better earnings for the bank.

dThe P/E ratio of RBL was more than the industry average because bank’s P/E was 36 times while industry average is approximately 10 times.

dRBL’s time interest ratio was not satisfactory because in 2010 bank had only 1.60 tk. earning against 1 taka interest obligation which was not good. But from trend analysis it has seen that RBL’s interest payment ability was increasing year by year.

 

dThe RBL’s return on asset (ROA) was increasing from 2007 to 2009 but last year bank’s ROA decreased silently which is not good sign on the other hand PBL was more efficient to generate additional return on asset than RBL.

 

dReturn on equity (ROE) was also fluctuating over four years but on an average PBL had better position from RBL.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Conclusion

And

Recommendations

 

 

 

 

 

 

 

7.1 Conclusion:

The Banking sector in any country plays an important role in economic activities. Bangladesh is no exception of that. As because it’s financial development and economic development are closely related. That is why the private commercial banks are playing significant role in this regard.

 

From the practical implementation of customer dealing procedure during the whole period of my practical orientation in Rupali Bank Ltd. I have reached a firm and concrete conclusion in a very confident way. I believe that my realization will be in harmony with most of the banking thinkers. It is quite evident that to build up an effective and efficient banking system to the highest desire level computerized transaction is a must.

 

 

This report focused and analyzed on General banking department of Rupali Bank ltd, Pollobi Branch. Rupali Bank ltd a popular bank in Bangladesh but its contribution in socioeconomic prospect of Bangladesh has the greater significance.

 

JBL is attaining offer of special deposit scheme with higher benefits, which is a crying need for long-term position in financial market. Because of the entrance of more banks in the financial market, deposits will splits over. Therefore, it is high time to hold some permanent customers by offering special deposit scheme otherwise in future amount of deposit may come down. To strengthen the future prospect of branch, it is an emergency to collect more deposits.

 

 

 

 

 

 

 

7.2 Recommendations:

 

  • Banking is a service-oriented marketing. Its business profit depends on its service quality. That’s why the authority always should be aware about their service quality.

 

  • To provide quality service to the customer it is necessary to have a trained team of an organization or an institution. For this reason the bank should recruit more fresh, bright and energetic persons such as MBA, BBA, and MBM etc.

 

  • As soon as possible the bank should start more branches in Dhaka city as well as the other cities of the country.

 

  • RBL is offering very medium interest rate of FDR, where as others banks are giving high interest rate than RBL. For this RBL is loosing their customers. So RBL should increase their rate of interest for FDR.

 

  • Now a day’s world is going very fast. Now, most of the banks open online customer service system. Though, Already has introduced on line banking system, but it has problem every day i.e. Jam, slow, Hanging etc. It may be developed on line banking for quick service and customer’s satisfaction.
  • In general banking department it is necessary to implement modern banking process instead of traditional system. It should be more computerized.
  • Account opening form could be more elaborated easily understandable.
  • Evening Banking should be introduced to extend service hour for customer’s
  • One of the business strategies is promotion. Successful business depends how they can promote their products or services to the customer. In this connection to improve the business status bank should introduce more promotional programs.

 

  • The recruitment process of the bank is very lengthy and expensive. The bank should the cost and select the employee by restructuring the lengthy process.

 

  • As the clients are not in favor of introducing system, if possible the rule of introducing to open an account should be changed. Because many people are facing problem to arrange an introducer in the time of opening accounts

 

  • In addition with the present services they should include more services. It is badly needed to provide more services to the customer in order to compete in the market.

 

  • To make exchange process more prompt the authority should use modern communication system such as e-mail, fax, win fax, internet etc

 

 

 

 

 

 

 

 

 

Bibliography

 

 

 

 

 

 

 


BIBLIOGRAPHY

 

Books:

vChandra Pachanna: Project Management.

vKothary C.R. : Research Methodology

vKapoor V.K. : “General Banking Management” and Sons, New Delhi, India. (1999)

vPanday I.M.-Financial Management (8th Edition). Vikas publication house pvt. Ltd. New Delhi, India.

vShekhar K.C : Banking Theory and Practice.

 

 

Documents:

1) Annual Report of Rupali Bank Ltd 2010.

2) Annual Statement of affairs of the branch 2006-2010.

3) Various official records.

 

 

Abbreviations

 

Bangladesh Bank                                           BB

Cash Credit                                                    CC

Credit Information Bureau                            CIB

Consumer Credit Scheme                              CCS

Credit Risk grading                                       CRG

Credit Risk Management                               CRM

Electronic Fund Transfer                               EFT

Financial Spread Sheet                                  FSS

Fixed Deposit Receipt                                   FDR

Head Office                                                   HO

International Accounting Standard               IAS

Industrial Credit Division                              ICD

Information Communication Technology      ICT

Rupali Bank Ltd.                                           RBL

Letter of Credit                                              L/C

Loan against Trust Report                             LTR

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The End

 

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