CHAPTER ONE INTRODUCTION Introduction: In today's fast growing world, business is more competitive. Banking is an essential industry. We often seek different credit lines such as Health line, Education line, Professionals line, Marriage line, Travel line, festival line, and some other retail loans. It also provides different types of incoming and outgoing deposits, checking account, ATM cards etc. Bank also provides financial advice on how and where to invest our savings. It also helps us in foreign trade. Banking industry is composed of thousand of firms worldwide. The role of Business Administration is increasing day by day. Every organization is concerned about the competency of their executive. To execute the duty and responsibility in efficient way and to cope with the technological advances in industrial and commercial development in this fast growing global environment, the ability and capability of the executive must be enhanced. The purpose of this program is
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A Case Study Of Factors Influencing The Money Market Agrani Bank Limited
In today's fast growing world, business is more competitive. Banking is an essential industry. We often seek different credit lines such as Health line, Education line, Professionals line, Marriage line, Travel line, festival line, and some other retail loans.
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CHAPTER ONE INTRODUCTION
Introduction:In today's fast growing world, business is more competitive. Banking is an essential
industry. We often seek different credit lines such as Health line, Education line,
Professionals line, Marriage line, Travel line, festival line, and some other retail loans. It
also provides different types of incoming and outgoing deposits, checking account, ATM
cards etc. Bank also provides financial advice on how and where to invest our savings. It
also helps us in foreign trade. Banking industry is composed of thousand of firms
worldwide.
The role of Business Administration is increasing day by day. Every organization is
concerned about the competency of their executive. To execute the duty and
responsibility in efficient way and to cope with the technological advances in industrial
and commercial development in this fast growing global environment, the ability and
capability of the executive must be enhanced. The purpose of this program is to prepare
students in such a manner so as to enable them to meet any challenging situation and to
work with competence in the competitive business environment. Bank is the core of the
modern economy. Banking industry is moving faster and changing rapidly by offering
new services continuously and consolidating into much large and complex business
adopting new technologies that seem to change faster than most of us can comprehend
and facing a new and changing set of rules to regulate and supervise the banks that serve
their citizen.
Currently there are four state owned commercial banks are operating in Bangladesh.
Agrani Bank Ltd. is one of the most successful nationalized commercial banks among
them.
Profile of Agrani Bank:Agrani Bank Limited, a leading commercial bank with 867 outlets strategically located
in almost all the commercial areas throughout Bangladesh, overseas Exchange Houses
and hundreds of overseas Correspondents, came into being as a Public Limited Company
on May 17, 2007 with a view to take over the business, assets, liabilities, rights and
obligations of the Agrani Bank which emerged as a nationalized commercial bank in
1972 immediately after the emergence of Bangladesh as an independent state. Agrani
Bank Limited started functioning as a going concern basis through a Vendors Agreement
signed between the ministry of finance, Government of the People's Republic of
Bangladesh on behalf of the former Agrani Bank and the Board of Directors of Agrani
Bank Limited on November 15, 2007 with retrospective effect from 01 July, 2007.
Agrani Bank Limited is governed by a Board of Directors consisting of 13(thirteen)
members headed by a chairman. The Bank is headed by the Managing Director & Chief
Executive Officer; Managing Director is assisted by Deputy Managing Directors and
General Managers. The bank has 7 Circle offices, 30 Divisions in head office, 52 zonal
offices and 867 branches including 10 corporate and 40 AD( authorized dealer) branches.
The corporate and AD branches are authorized to deal in Foreign exchange business. The
authorized capital of the Bank is Tk. 800 crore.
1.3 Objectives of the Study:The study has some objectives. They are
The report is aimed at studying and understanding the various products offered by
the Bank's each Department to its clients as well as the several activities carried
out to achieve the departmental objectives.
To know about the influencing of money market in Agrani Bank.
To know about L/C document handling i.e. settlement procedure of L/C
To know about the import L/C opening procedure.
To know about the remit of funds.
The report also studies how AGRANI BANK LIMITED maintaining growth in
overall banking activities.
This internship report also aims to analyze the performance of the branch as well
Name DesignationDr. Khondoker Bazlul Hoque Chairman Mr. Ranjit Kumar Chakraborty DirectorMr. Shekhar Dutta DirectorMr. Nagibul Islam Dipu DirectorMr. Md. Ekramul Hakim Company SecretaryMr. Lian Kim Seng Company SecretaryMr. Nik Hisham Nik Company SecretaryMd. Abul Bashar CEO and DirectorMd. Monir Uddin General ManagerMd. Enamul Hoque General ManagerMd.Omar Farooque General ManagerMd. Khalilur Rahman General ManagerMd. Khurshed Hossain General ManagerMd. Sarwar Jahan Deputy General ManagerMrs.Aqiqunnessa Deputy General ManagerMd. Mijanur Rabbi Deputy General ManagerMd. Abdur Rashid Deputy General ManagerA.S.M. Rafique Deputy General Manager
Functions:
In addition to traditional deposit taking in various accounts and providing loans to almost
all sectors of the economy, the bank offers many other services through its schemes of
school banking, inland traveler’s cheques, pension funds, industrial development bond
and inland remittance. The bank operates some income generating and economic
development projects such as the Productive Employment Project, Netrokona Integrated
Agri-product and Water Management Project, IFAD Project for poverty Alleviation
through Employment Creation, Kurigram Poverty Alleviation Project, Crop
Intensification Project, National Micro Irrigation Development Project, Micro
Entrepreneurship Development Project, and Agricultural Diversification and
Intensification Project. The bank participates actively in foreign exchange business
including overseas remittance services. The total volume of foreign exchange business
Margin voucher should be posted in the margin deposit register party-wise,
incorporating L/C number. L/C commission and other charges are realized from the
party before opening L/C. National amount may be realized as FCC(foreign
correspondent's charges). FCC includes the advising, postages, cable charges, the
foreign bark charges.
Shipping documents:
Five vital documents consist in an L/C document. These are as Commercial invoice
Bill of Exchange
Bill of Lading
Packing List
Certificate of origin.
Moreover, beneficiary must send shipping advice to the L/C opening bank with in five
working days of shipments.
Commercial Invoice:
The invoice prepared relating to shipment of the goods is commonly identified as
commercial invoice. Commercial invoice is an integral part of the shipping document
prepared by the seller s per terms of the credit. This incorporates the description and
price of goods quantity, quality, name of the buyer, origin, credit and contract
number, name of the vessel, date of shipment, shipping marks, number of packages. This
also may be considered as a seller's bill. This is submitted in number of copies as is
asked by the credit and copies are also needed for custom.
Bill of Exchange:A bill of exchange is an instrument in writing containing an unconditional order, sinned by
the maker. Directing a certain person to pay on demand or at a fixed determinable
future time a certain sum of money only to, or to the order of a certain person, or to the
bearers of the instrument.( Negotiable Instrument Act. 1881, Section
Bill of Lading:
It is a transport document. The Bill of Lading gives proof of shipment/carriage of goods
from port of Lading /place of receipt to port of discharge/place of destination. The bill of
Lading would carry the following information: It must be issued by a ‘named carrier or his agent'.
Description of goods consistent with that in the
credit.
Identifying marks and numbers.
The name of the carrying vessel.
Indication of dispatch or loading and the place of final destination.
The names of' shipper, consignee and the name & address of any
`notify' party.
Whether Freight has been paid or is still
to be paid.
Date of issuing.
3. Packing List:This enlists full particulars of the goods as number of cartoons, bags, pieces, net and
gross weight, shipping marks.
4. Certificate of origin: This certifies his country of origin that manufactured of produced the goods. An
approved chamber of commerce of the exporter's country generally issues the certificate
or as has been stipulated in the credit terms.
5. Inspection certificate: An inspection prior to shipment is conducted by an independent body which confirms
by certifying that the quantity and price and/ other aspects of the goods as have been
specified in the contract. The inspection agency is nominated by the buyer or L/C
opening or as per rule of the importer's country.
When the draft is returned by the drawee (importer) having been duly accepted by
him, the following retirement procedure is followed:
The maturity date of the bill is to be worked out and noted in the
PAD/be registered and also in due date dairy.
The foreign correspondent should be advised the due date of maturity
and be authorized to debit the Nostro account of Authorized Dealer or
to claim reimbursement on due date as per terms of L/C from the
reimbursing bank.
In case of D.A bill, all documents excepted draft are delivered to the
importer against a simple receipt.
The invoice is marked "Documents Delivered against Acceptance and
remittance of Will be effected on due date.
Clearance in absence of shipping documents:
Shipping Guarantee:
It is a guarantee- Cum-indemnity issued by the bank in favor of the shipping company on
prescribed from provided by the shipping company. When shipping documents against
Sales / Purchase Contract
L/C are not received by the bank but goods have arrived at port needing
immediate clearance if the consignment to avoid demurrage, this guarantee is issued. The
shipping company shall release goods to the importer on production of this guarantee.
Procedure for issue of guarantee:
Importer should submit the following documents to the bank for issue of the guarantee.
Counter guarantee signed documents to the bank for issue of the guarantee.
Copy of invoice.
Non-negotiable copy of bill of lading/Airway bill etc.
Deposit of' It30% margin n invoice value.
On receipt of the above documents and margin, the bank will give endorsement on the
shipping guarantee at the end of the following way:
"The above indemnity is countersigned on condition that the bank's liability
hereunder shall not exceed Tk.... and the bank will be finally discharged and
released from its liability if a claim hereunder is not lodged with the bank by..."
Document Retirement:
After retirement' of documents by the importer, the bank will put endorsement on the draft
starting -Received Payment" under seal and signature of the bank's authorized officer. The
invoice is certified as "certify invoice value". The E3/L, is endorsing in favor of the importer.
The draft together will all the other shipping documents are delivered to the importer showing the details of' charges debited to the importer's account along with the Customs Purpose copy of Import License / LCAF retained earlier.
Mechanism of L/C
Importer Exporter
Mak
es p
aym
ent a
gain
st d
ocum
ents
(9)
Pres
ents
doc
umen
ts (8
)
App
lies i
n w
ritin
g to
issu
e L/
C (1
)
Adv
isin
g / C
onfir
min
g L/
C (3
)
Subm
its d
ocum
ents
(4)
Pays or Reimburses
Forwards Documents (6)
Makes payments (7)
Instructs to pay or reimburse
ORM
akes
pay
men
ts b
y ne
gotia
ting
docu
men
ts
(5)
Advising/Negotiating Bank
Issuing Bank
Paying / Reimbursing
Bank
Back to Back L/C
One credit backs by another. It may so happen that the beneficiary/seller of an
L/C is unable to supply the goods direct as specified in the Credit as a result of which
he needs to purchase the same goods and make payment to another supplier by
opening a second letter of credit. In this case, the second credit called a "Back to
Back Credit". A Back-to-Back mechanism involves two separate L/Cs. One is
master Export LIC and another is Back-to-flack L/C. On the strength of Master
Export L/C bank issues bank to Back I,/C. Back-to-Back L/C is commonly
known as Buying L/C. On the contrary, Master Export L/C is known as Selling
L/C.
Export Procedure:The imports and exports trade of our country is regulated by the Imports and Exports
(Control) i1.cL 1950. No person who has been granted registration by the Chief
Controller of Imports & Exports shall indent, import or export anti thing into or out of
Bangladesh except in cases of exemption issued by the government. If any person
contravenes any provision of the Act or any order made under this Act is punishable with
imprisonment for a term, which may extend to one year or with fine or both.
There are a number of` formalities which an exporter has to fulfill before and after
shipment of goods. These formalities or procedures are enumerated as follows:
Registration of Exporters:
The exports from-, Bangladesh are subject to export trade control exercised by the
Ministry of Commerce through Chief' Controller of Imports and Exports (CCI & E). No
exporter is allowed to export any commodity permissible for export from Bangladesh
unless he is registered with CCI & E and holds valid Export Registration Certificate
(ERC) is required to be renewed every year. The ERC number is to be incorporated on
EXP forms and other papers connected with exports.
Procedure for obtaining Export Registration Certificate
For obtaining export Registration Certificate (ERC ), intending Bangladeshi Exporters
are required to apply to the Controller/Joint Controller/ Deputy Controller/Assistant;
Controller of' Imports and Exports, Dhaka/ Chittagong/ Rajshahi /Khulna/Mymensingh/Sylhet/
Comilla/Barisal/Pabna//Bogra//Rangpur/Rangpur/Dinajpur, as the case may be, in the
prescribed form along with the following documents-.
Nationality and Assets Certificate of the Proprietor /Directors;
Registered Partnership Deed in case of Partnership concerns;
Memorandum and Articles of Association and Incorporation Certificate
in case of Limited Company;
Bank Certificate
Income Tax Certificate (TIN),
Copy of Valid '.Trade License:
Copy of Rent Receipt of-the Business Premises,
Membership Certificate of a Trade Association:
Affidavit from a 1st class magistrate;
Any other certificate required in the Policy etc.
Registration/ Renewal
On receipt of necessary advice from the offices of the Control/Joint Controller Deputy Controller/Assistant Controller of Imports and Exports, applicants for Exports Registration. Certificates are required to deposit requisite Registration Fee to the Government Head of Account "42- Trade and Commerce - Fees realized under the imports and Exports Control Act. 1950" through Bangladesh Bank Government Treasury/Sonali Bank. Copies of Treasury Chalans showing payment of' fees should be sent to the concerned offices of the Chief Controller of Imports and Exports for enabling them to issue Export Registration Certificate. Once registered, exporters are to make annual payments for having their export Re-gist ration Certificate renewed.Securing the Order: Upon registration, the exporter may proceed to secure the export order. He can do this
by contracting the buyers directly through correspondence. Some buyers '.)f goods like
jute and jute goods maintain liaison office, representatives or local agents who can be
contracted to secure a deal. Sometimes, TCB BJMC and BJEC secure bulk contracts
and pass or allocate the contracts to the actual exporters. To locate the foreign buyers,
fl-Ac exporter may contract the local Chamber of Commerce of potential buyers. The
Export Promotion Bureau and the Bangladeshi missions abroad are also good sources
for securing information on the prospective foreign buyers.
Signing the contract:The following are the points which need to be borne in wind while making a contract.
Description of the commodity.
Quantity of the commodity.
Price of the commodity.
Shipment.
Insurance and marks.
Inspection.
Arbitration.
Receiving the Letter of Credit
The followings are the main points to be looked into –
The terms of the L/C are in conformity with those of the contract.
The L/C is an irrevocable one, preferably confirmed by the advising bank.
The L/C allows sufficient time for shipment and a reasonable time for
negotiation.
If the exporter wants the letters of credit to be transferable, divisible
inadvisable, he should ensure that these stipulations are specifically mentioned in the
L/C.
Remittance:Foreign remittance refers to the transfer of fund from one country to another either through
the office channel 'i.e. banking channel, Post office or the informal channel. In
Bangladesh still informal market is playing a significant role. However, we shall limit our
discussion within the official channel. Inward and outward '1'.T, M.T and draft are the
main component, of foreign exchange remittance.
Foreign exchange earnings are very low as export earnings are very limited while
import spending are huge which makes the balance of' trade position in a chronic deficit
situation. 'Foreign remittance is very important for the country as valuable foreign
exchange is involved in the transfer mechanism. From the year 1990, financial
liberalization has concern started which side is going on. Due to liberalization,
restrictions on foreign remittance become case. Bangladeshi taka. is convertible for current
account transactions on March 24, 1994 with the view to achieve better exchange ate
management system. And from April 1994 Bangladesh Government has accepted the
status of Article VIII of international monetary fund.
Foreign remittance has two wings i.e. inward and outward remittance. This can be
9. Profit after Tax and Provision 1630 1940 860 265010. Total Assets 155530 154080 186280 18732010. Earnings per Share 34.56 106.52
11. Number of Employees 11938 11793 11345 10988
12. Number of Branches 864 866 866 867
Foreign Exchange Performance over Time:To analyze the performance of AGRANI BANK LIMITED in foreign exchange business I have established some assumptions-
5.2.1 ASSUMPTIONS TO THE ANALYSIS
It is assumed that the reported financial data are free from error & bias because there were no scopes of the study is to verify the data
All the analysis & findings are valid up to 2008 because the other data are not available
The data shown of 2009 are estimated figures I have selected banks with the following classification criterion Nationalized Commercial Bank(State Owned Bank) Private commercial banks (PCB)
The banks selected are assumed to be the representatives of banking sector of our country.
5.2.2 LIST OF BANKS SELECTED FOR COMPARISON
State Owned Banks: Sonali Bank LimitedJanata Bank Limited
Private commercial banks: Bank Asia LimitedOne Bank LimitedNCC Bank LimitedPubali Bank LimitedStandard Bank LimitedThe City Bank LimitedIFIC Bank LimitedDBBL Bank LimitedUttara Bank LimitedDhaka Bank LimitedNational Bank LimitedAB Bank LimitedDhaka Bank Ltd.National Bank Ltd.AB Bank Ltd.
However, the whole analysis is based on comparison & relationships between these banks & Agrani Bank Limited Ltd. The derived comparative results may vary if other banks are selected.
5.2.3 GROWTH STATISTICS IN FOREIGN EXCHANGE BUSINESS
Here is the growth statistics of the banking sector (selected banks). The figures of 2008 are estimated by the individual banks.
Comments:In the above table we see that the growth of Import in foreign exchange sector is negative in 2007 and 2008 and the export of 2007 is negative and also lower in 2008 of Agrani Bank Limited and in the selected banks in 2007 the export and import both was lower in 2007. This is because of the macroeconomic variables like political turmoil, global economic situations etc.
Comment:Here we see that downturn from 2006 to 2007 and thereafter it was rising. This is because of political & other macroeconomic variables.
5.2.5 SECTOR WISE COMPARISON
The sector wise comparison reveals that
Agrani Bank Limited is lagging behind compared to the other banks in foreign exchange business. But the bank has a consistent performance with the trend of industry’s performance
The remittance business for Agrani Bank Limited is significantly lower than the other local competitors.
This can be a cause of customer focus /market segment of the bank The bank has a huge amount of loan incentives for export & import business
compared to other performances in foreign exchange activities
Export Compared To Selected Banks
020,00040,00060,00080,000
100,000TK
. in
Cror
e
All Selected baks 48,714 60,935 61,582 83,968 95,004
Agrani BankLimited
4,171 5,171 4,892 4,954 5,095
2005 2006 2007 2008 2009
Comments:Export operation of AGRANI BANK LIMITED is significantly lower than other counterparts but consistent with the ups & downs.
Import Compared To Al Selected Banks
0
20000
40000
60000
80000
100000
Tk. i
n Cr
ore
All Banks 48714 60935 61582 83968 95004
Agrani BankLimited
5119 11502 11343 10952 12781
2005 2006 2007 2008 2009
Comments:Import operation of AGRANI BANK LIMITED is also significantly lower than other counterparts but consistent with the ups & downs.
Remittance Compared To All Selected banks
0
40,000
80,000
120,000
160,000
200,000Tk
. in
Mill
ion
All Banks 57,974 87,006 102,195 130,940 158,005
Agrani BankLimited
34,570 39,300 42,810 52,690 56,104
2005 2006 2007 2008 2009
Comments:Remittance operation of AGRANI BANK LIMITED is significantly lower than other counterparts and inconsistent with the ups & downs. They are much weaker in the remittance business.
5.2.6 REGRESSION ANALYSIS OF AGRANI BANK LIMITEDS
Interpretation: By coefficient of correlation (R), we can measure association between export and profit after tax or import and profit after tax. Basically it provides the direction either positive or negative of the correlation. The advantage of the coefficient of correlation is that it provides a measure of the strength of the correlation & it gives the true direction of the correlation (+ or -) but only the square root of the strength of the correlation. As we know, the value -1 represents a perfect negative correlation that means when one
increases, the other decreases in exactly the same proportion. The value +1 represents when one
increases, the other increases in exactly the same proportion. The value 0 represents a lack of
correlation. Here correlation coefficient (R) of import & profit is 0.110
2006 2007 2008 2009Import 11,502 11,343 10,952 12,781Export 5,171 4,892 4,954 5,095Profit after Tax and Provision
1960 860 2650 2265
This clearly indicated the movement direction of the two variables. R between import and profit
is 0.110 which indicates very weekly positive relationship that means
If import business increases Tk. 1 then profit after tax will be increased by Tk. 0.11
R2 value of 0.012indicates that about 1.2% of variations in the AGRANI BANK
LIMITED profits can be explained by its import operations
Finally the results are significant at 89.0 % significance level
Interpretation: R, among Profit, Export, and Import is 0.42 which is moderately positively correlated says that
If import & export business increases Tk. 1 then profit after tax will be increased by Tk. 0..42
R2 value of 0.173 indicates that about 17.3% of variations in the AGRANI BANK LIMITED’s profits can be explained by its combined operations of import & export
Finally the results are significant at 20.9 % significance level
Note: The above calculation was done by using Minitab & Ms-excel(Amount in Crore)Interpretation: Stability in foreign exchange business is influenced by several international and domestic
factors. Factors that influenced in foreign exchange businesses are – exchange rate,
bargaining power of exporter and importer, country’s political disturbance,
competitiveness of banking sector and other macro economic factors. For measuring
stability of export and import business of Agrani Bank Limited, we have calculated
Standard deviation (SD) and Coefficient of variation (CV) which is relative measures of
standard deviation.
Here we see,
Standard deviation in import business of AGRANI BANK LIMITED is Tk. 792 Crore
and Coefficient of Variation is 6.8%.
On the other hand export business standard deviation is Tk. 128 Crore with CV of 2.54%.
So we can say that the export import operation is not stable for the bank at a satisfactory
level
Problems in Foreign Exchange Business for the Bank:
Most of the activities are done by manually and lack of the efficiencies among the employees.
Lack of latest or improved technologies and skilled manpower for operating foreign exchange business.
Lack of sophisticated software for banking solution is a great problem in modern banking era.
AGRANI BANK LIMITED makes a positive impact in the economy by their
Foreign Trade which helps our country to grow.
Many of customers do riot have clear idea about the procedures of opening
L/C.
AGRANI BANK LIMITED lacks good number of quality customer.
It is observed that there is lack of motivational activities
Working environment is not sound one, Most of' the officers are working
under pressure and mentally depressed.
Overall Summary of the Findings:
Agrani Bank Limited is a scheduled public bank established on 1972. Within this period
of time the bank has been able to prove itself as one of the most progressive and dynamic
banks in the country.
In my internship period, I have worked in different desks in this bank and I have prepared
my especially on Factors Influencing the Money Market: A Case Study of Agrani Bank
Limited. Also I had to given highlight in a specific department and identify the most
important factors, which influence the prescribed generation. So the internship report
contains the activities of Agrani Bank Limited, Panthapath branch on the following
guidelines: Factors Influencing the Money Market.
In general banking section I work in accounting opening section .I also work in FDR and
cash section’s tried to find out their process of work. I have prepared this report based on
practical fieldwork, personal contact with the top executives of ABL and officers of
CHAPTER SIX CONCLUSION AND RECOMMENDATIONS
different stages of the bank with the involvement of regulatory guidelines provided by
central bank. Different data used in this report have been collected from different primary
and secondary sources.
Finally, As an ABL, special banking system is a separate bank, all the people in general
have right to know how well their money is utilized through banking services by the
special activities in the banking world in our country or foreign country. The profit &
profitability of ABL depends on the degree, to which it’s financial health or managerial
activities through the targets in all respects, which is fixed up for the particular period of
time. Until now there has not been any comprehensive study on the profit & profitability
trend of ABL in Bangladesh. Very few researches have been conducted on this field of
ABL in Bangladesh. Keeping this in mind an important attempt has been taken in this
study to measure the profit & profitability trend of ABL in Bangladesh.
Conclusion:This report has been prepared as an effort to analysis ABL and constituencies gain a
better understanding of the money influencing factors that influence money performances
in market. This report examines as an example ABL and the long-term relationship. The
information highlights the strong linkage between the money in stock market.
By analyzing the annual report 2009 in Agrani bank, a brief discussion in my report is
(1) The money supply, the proportion of non-tradable shares, and the ROE/profit margin
on net assets have most significant impacts on the choice of consideration. And different
factors have different impacts on the probability of consideration choice. Each choice
results from integrated effects of all factors.
(2) One stock’s market performance and whole capital market’s performance do not have
significant impacts on certain listed company’s consideration. Their impacts mainly focus
on the company’s situation and macro environment.
(3) Macro economic factors have certain effects on the choice of consideration, whether
the market participators realize it or not, and the effects are objective and should not be
neglected.
We can further draw these conclusions:
4) The proportion of non-tradable shares is an important influencing factor that affects
the distribution of shareholders’ interests. Although its influences disappear on the
surface, as the non-tradable shares reform is closed, it is evolved into the quantity and
proportion of newly tradable shares. Therefore, we can still take this factor as the basis
for protecting interests of small and medium shareholders.
5) Listed company’s condition is still an important influencing factor. Better conditions
and higher ROE/profit margin on net assets mean small and medium shareholders can
obtain relatively direct interests. In re-distributing interests, such as consideration
payment, the trend to be lower is rational.
6) Macro factors, especially money supply, have great impacts on shareholders’
behaviors. According to studies above, tight monetary policy is still appropriate. At
present, an appropriate tight monetary policy can help to create a favorable macro
environment for China’s capital market.
Recommendations:Though out my internship I discovered that ABL have the opportunity to improve in the
followings sector:
1. Market Promotion: In today’s business, promotional activities is one of the most
import tasks for improvement of the business. ABL does not concentrate much
about this. Hence the firm could be benefited if it invests in the market
promotional activities.
2. Provide Lease To Financial Institution: Over time it has been shown that the
overdue rate is minimum in case of financial institutions. Therefore ABL could
reduced its overdue rate if focus mostly on the providing lease to the financial
institutions.
3. Branch Proliferation: ABL has only three branches; two in Dhaka, one in
Chittagong. It would be benefited if it opens branches in the other places like
Norshingdi, Jessore, Khulna etc as there are huge opportunities of business.
4. Employee’s Incentives: The bank may increase the efficiency of its personnel by
increasing incentives, training etc.
5. Information System and Network: ABL could improve it information
technology by employing the high technology based information system and
networks.
6. Growth Rate: The growth rate of ABL recently plummets due to low retention
could improve its growth rate by reinvesting more from its earnings.
7. Diversify the source of fund: ABL basically depends on the money market
borrowing, call money for source of fund. Rather ABL should concentrate in
collecting deposit from depositors as sound source. When other financial
institutions are looking for new ways to collect deposit, ABL concentrates in
borrowing fund from other banks. Borrowings from the money market increase
the cost of fund.
Separate HR Department:
ABL has no separate HR Department. One of its senior officers performs HR
Management duty for one year tenure along with regular duty. This method
doesn’t provide proper motivation mechanism to employees. So that its employee
turnover rate is high at lower level. ABL should maintain separate HR
Department as early as possible.
Publishing the basic data of the company.
Preparation of monthly rental list
Preservation of rental check.
Collection of dishonored check from the concerned banks
Preparation of dishonored statements
Passing the dishonored statement to the monitoring department.
Collection of bank statement from the concerned banks
For the customers who have applied for rescheduling the accounts and finance
department calculate the rescheduled amount for the client
Calculation and checking the relevant documents to match the rental list before
issuing a closer memo
Preparing the monthly salary statements for the employees
Income taxes are paid through this department
Arrange fund for the company through call money and credit line agreement with
different bank.
Keep the activities on track so that nothing deviates from the rules and regulation
of the Bangladesh Bank
Prepare Balance Sheet, Income Statement, Cash Flow statement for half yearly
and annual report
REFERENCESBOOKS:
Annual Report of ABL Limited 2009.
Several Booklets from ABL
Several Newsletters from ABL
ABL Web site.
Several Reports from ABL Library.INTERNET & WEB ADDRESS: