City Bank Term Paper

Introduction

It’s our great pleasure to introduce City Bank. Since our beginning, always we have been trying to maintain the best quality standard of our banking sector. We can give a loan for many people, business industry, bank etc. We constantly innovate by frequently introducing new balance sheet.

City Bank is one of the oldest private Commercial Banks operating in Bangladesh. It is a top bank among the oldest five Commercial Banks in the country which started their operations in 1983. The Bank started its journey on 27th March 1983 through opening its first branch at B. B. Avenue Branch in the capital, Dhaka city. It was the visionary entrepreneurship of around 13 local businessmen who braved the immense uncertainties and risks with courage and zeal that made the establishment & forward march of the bank possible. Those sponsor directors commenced the journey with only Taka 3.4 crore worth of Capital, which now is a respectable Taka 330.77 crore as capital & reserve.

City Bank is among the very few local banks which do not follow the traditional, decentralized, geographically managed, branch based business or profit model. Instead the bank manages its business and operation vertically from the head office through 4 distinct business divisions namely Corporate & Investment Banking; Retail Banking (including Cards); SME Banking; & Treasury & Market Risks. Under a real-time online banking platform, these 4 business divisions are supported at the back by a robust service delivery or operations setup and also a smart IT Backbone. Such centralized business segment based business & operating model ensure specialized treatment and services to the bank's different customer segments.

The bank currently has 83 online branches spread across the length & breadth of the country that include a full fledged Islami Banking branch. Besides these traditional delivery points, the bank is also very active in the alternative delivery area. It currently has 25 ATMs of its own; and ATM sharing arrangement with a partner bank that has 225 ATMs in place; SMS Banking; Interest Banking and so on. Soon its Customer Call Center is going to start operation. The bank has a plan to end the current year with 50 own ATMs.

City Bank is the first bank in Bangladesh to have issued Dual Currency Credit Card. The bank is a principal member of VISA international and it issues both Local Currency (Taka) & Foreign Currency (US Dollar) card limits in a single plastic. VISA Debit Card is another popular product which the bank is pushing hard in order to ease out the queues at the branch created by its astounding base of some 400,000 retail customers. The launch of VISA Prepaid Card for the travel sector is currently underway.

City Bank prides itself in offering a very personalized and friendly customer service. It has in place a customized service excellence model called GAP (Graceful-Appropriate-Pleasing) that focuses on ensuring happy customers through setting benchmarks for the bank's employees' attitude, behavior, readiness level, accuracy and timelines of service quality.

City Bank is one of the largest corporate banks in the country with a current business model that heavily encourages and supports the growth of the bank in Retail and SME Banking. The bank is very much on its way to opening many independent SME centers across the country within a short time. The bank is also very active in the workers' foreign remittance business. It has strong tie-ups with major exchange companies in the Middle East, Europe, Far East & USA, from where thousands of individual remittances come to the country every month for disbursements through the bank's large network of 83 online branches.

The current senior management leaders of the bank consist of mostly people form the multinational banks with superior management skills and knowledge in their respective "specialized" areas. The bank this year, is celebrating its 25th year of journey with the clear ambition of becoming the no.1 private commercial bank in the country in 3 years time. The newly launched logo and the pay-off line of the bank are just one initial step towards reaching that point.

Objective

Our objective is to earn competitive return from our various business activities at acceptable risk levels. Risk management involves overseeing the risks associated with all our business activities in the environment in which we operate, and ensuring that risk-taking is within prudent boundaries and that the prices charged for products and services properly reflect the risk we take. Risk is calculated in terms of impact on income and asset value. We assess the potential effect on our business consequential to changes in political, economic, market and operating conditions, and the creditworthiness of our clients using four primary risk categories: credit, market, liquidity and operational risk. In the management of these risks we rely on:

The competence and experience of our dedicated professional staff operating with due segregation of duties;

Sophisticated, quantitatively based analytical tools; Ongoing investment in technology.

This combination of prudence, analytical skills and technology, together with adherence to our operating procedures, is reflected in the strengths and quality of our earning over time.

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Methodology

The Methodology of this project is to understand the financial position of a business through financial statement.

In this term-paper several financial position are used to SWOT analysis in this business.

The method is very simple. We took the information from the SWOT analysis of the business.

Financial Performance - Overall Activities

Highlights on the overall activities of the bank for the year 2007 and 2006

Sl. Particulars Year Under Review (2007) Previous Year (2006)1 Paid-up capital 1,188.00 1,080.002 Total capital 3,156.25 2,601.003 Capital surplus / (deficit) 652.55 59.504 Total assets 48,755.40 47,445.755 Total deposits 40,539.63 40,881.416 Total loans and advances / investments 26,788.47 30,789.027 Total contingent liabilities and commitments 8,277.64 12,901.578 Credit deposit ratio 66.08% 75.31%9 Percentage of classified loans / investments against total loans and advances /

investments 6.24% 7.18%10 Profit after tax and provision 343.46 240.0211 Amount of classified loans /

investments during current year 1,671.83 2,209.7312 Provisions kept against classified loans /

investments 462.78 943.2613 Provision surplus/(deficit) against classified loans /

investments 40.00 - 14 Cost of fund 7.55% 6.94%15 Interest earning assets 42,757.28 40,820.2416 Non-interest earning assets 5,998.12 6,625.5117 Return on investment (ROI) 12.33% 8.58%18 Return on assets (ROA) 0.71% 0.58%19 Income from investment 860.27 431.4520 Earnings per share (Taka) 28.91 20.2021 Net income per share (Taka) 28.91 20.2022 Price earning ratio (times) 25.09 19.31

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On 5th July 2008, The City Bank Limited changed its brand name into, simply, City Bank. Bank's new logo along with a brand philosophy line or pay-off line were unveiled that day at a ceremony held at Radisson Water Garden Hotel, Dhaka, Hon'ble Advisor to the Ministry of Finance & Planning, Dr A B Mirza Azizul Islam did this honor to the bank by launching it. We give here a simple note on the philosophy that went behind the creation of this logo:

It's a simple logo. Its beauty is in its simplicity of arrangement which is also bold. Since it is simple, it connects with people easily.

The red and silver shape may mean a chess board. Chessboard stands for wisdom & vision. Since we are 25 years old, we are expert, wise & experienced. Chess is the game of the smart people who knows all the moves. Our game is to deal with your money matters and - as wise & experienced bankers, we are experts in that.

The red and silver shape may also mean something dynamic. It may mean the checkered flag of Formula One Racing. Then it signifies speed and agility & fast pace.

The red and silver shape may also mean a kite. It's a beautiful colorful kite, nose up, going to reach for the sky. In that case, it means the bank is soaring high into the skies of many possibilities in order to make customers' financial dreams come true

The red and silver shape may also mean it's a flying chessboard. It's a chess-board that has taken wings and is flying. In that case it indicates to what extent this bank can go to serve customers better

The logo has a dynamic shape. Such dynamism stands for modernity, the 21st century. That signifies, this is going to be a techno-savvy bank, a state-of-the-art tech-powered modern bank

The color 'red' stands for emotion, passion, strength, vitality, action, confidence & courage.

The color silver symbolizes riches, just as gold does. Silver is glamorous & distinguished. Silver is the traditional 25th anniversary color or Silver Jubilee color. Another thing is: "Pieces of silver" means money or coin. And our pay-off line is "Making Sense of Money".

Now the pay-off line "Making Sense of Money".

No money, no bank. We all know how important money can be for any of us. Money is a need all by itself. It is the most precious thing. Money is the port key to any destination. It is everything between a person and his / her dreams & hopes. So, the money which is almost synonymous to life must make sense. And for your money to make sense, it must be handled by an expert. That is where we come in. We say, we make sense of your

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money. Because at City we are wise men of banking. With 25 years of experience, we know how to make your money more meaningful for you, how to lend you money in times of your needs or how to grow your money safely for you.

Retail Banking

One of the most remarkable success stories of last 50 years’ banking industry globally has been the conceptualization and innovative execution of banking with individual customers, their friends & families. The industry has termed it as Retail Banking or Personal Banking or Consumer Banking; and it has now - at a very rapid pace – become the major revenue line for most of the top banks in the world.

City Bank, too, recently has started its journey in Retail Banking.

“City Retail - add a little city to your life” is the new brand-mantra, the pay-off line for City Retail.

Our aim is clear. We want City Bank to become the most preferred bank to all individual clientele of the country, at least of the cities and towns where we operate. We want to provide our customers the best-in-class services, innovative products and financial solutions from smart outlets - all with a big smile that conveys and generates happiness all the way!

Deposit

City Bank offers a wide variety of deposit products to meet your financial needs. From current and savings accounts to Fixed Deposits and Pension Schemes each account is designed to give you the best value for your money.

Please take a closer look at all the deposit products of City Bank has to offer and then visit any of our branches close to your location.

Current Account

Our current account meets the needs of individual and commercial customers through our schedule benefit.

Minimum balance: Taka 5,000/-

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Interest Rate: Nil

Customer Benefit:

Cheque-book facility

Opportunity to apply for - safe deposit locker facility

Collect foreign remittance in both T.C. & Taka draft.

Transfer of fund from one branch to another by

- Demand Draft

- Mail Transfer

- Telegraphic Transfer

Transfer of fund on Standing Instruction Arrangement

Collection of cheques through Clearing House.

Online banking service.

Saving Account

It is a sound savings for retail customer. We give the major facilities and services to our customer through 77 branches allover in Bangladesh with our skilled manpower.

Minimum balance: Taka 500/-

Interest Rate: 6.50

Customer Benefit:

Cheque-book facility

Opportunity to apply for - safe deposit locker facility

Utility payment service

Collect foreign remittance in both T.C. & Taka draft.

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Transfer of fund from one branch to another by

- Demand Draft

- Mail Transfer

- Telegraphic Transfer

Transfer of fund on Standing Instruction Arrangement

Collection of cheques through Clearing House.

Online banking service...

City Onayash

City Onayash – earn easy on your savings account, earn profit every month!

City Onayash is a unique kind of savings account which calculates interest on your daily balance and pays interest to you every month.

It is a major departure from the conventional savings account available in the market. All such accounts calculate interest on the average or lowest balance of the month, while City Onayash does on daily product basis. Not only that, while those conventional savings accounts pays interest only twice a year - in December and June - City Onayash pays it to you every month. Happiness at each month end!

Eligibility:

Age: At least 18 years

Nationality: Bangladeshi

Availability:

All 83 of City Bank branches spread across the country.

What you need to do:

Just fill up the City Onayash account opening form and hand it over to our branch staff. That’s it! Enjoy saving in a unique way!

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Special Feature:

Withdraw and deposit cash as you wish – without at all having your monthly interest earning eligibility.

No hidden or undisclosed fees or charges or profit-cutting

Interest forfeiture rules of a common conventional savings account do not apply here. So, stay tension-free-100%

Every month’s interest earning goes into your account automatically. What better way to take care of you family’s recurring monthly expenses?

Interest Rate: 5.50

City Shomridhdhi

City Shomridhdhi - A unique offer from City Bank

City Shomridhdhi is an exceptional DPS product that is distincity more attractive than the prevalent DPS products in the market. You receive a hefty sum at the end of the term against your monthly deposit of small installments. It's a perfect way to secure your financial future!

Eligibility

Age: At least 18 Years

Nationatity: Bangladeshi

Features

No initial deposit required

Monthly installment deposit ranges from Tk. 500 to Tk. 20,000

Flexible tenor of 3, 5, 7 and 10 years

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On premature encashment, you get the maturity value of nearest term - not the routine savings rate.

Profitability Matrix:

Term Interest Rate3 (Three) Years 10.005 (Five) Years 10.257 (Seven) Years 10.5010 (Ten) Years 11.00

City Projonmo

City Projonmo – financial safety for your future generations backed by complete immense protection!

City Projonmo is a unique monthly deposit scheme that you open for your kids to safeguard their future against all uncertainties and risks. As a guardian of the child you can open this account which builds great & unmatchable savings for you over the years. By the time your child is past his or her school age, there is this sufficient cash in your hand to take care of his / her higher education, marriage or other such large expenses.

However, the most interesting part of this scheme is the full insurance protection that you automatically enjoy. This simply means, in case of death or total physical collapse of the parent or guardian, the bank will pay the full value of the scheme for the full term no matter in reality how many months or years have been actually completed by you.

Eligibility:

Age: At least 18 years

Nationality: Bangladeshi

You will have to have a savings or current account in your name in order to operate your City Projonmo account.

Availability:

All 83 branches of City Bank spread across the country.

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What you need to do:

Just fill up the City Projonmo account opening form. Submit it to the branch. And that’s it! Enjoy earning for your junior ones!

Profitability Matrix:

Term Interest Rate5 (Five) Years 9.2510 (Ten) Years 9.5015 (Fifteen) Years 9.0020 (Twenty) Years 9.00

Fixed deposit

If you believe in long-term investments and wish to earn higher interests on your savings, NOW is the time to invest your money in our Fixed Deposit.

Fixed Deposit Rate

Term of Deposit Interest Rate1 (one) month 09.003 (Three) months 11.506 (Six) months 11.5001(One) yearBelow Tk. 1.00 crore 12.00Tk. 1 crore & above 12.5002(Two) years 11.50

Auto Loan for salaried person, business person & self employed individuals

Loan up to Tk. 20 Lacs

90% - 100% loan of car value

Flexible & low interest rateOwning a car is no longer a luxury. Car for your family is now a matter of fulfilling a necessity. Appreciating that basic need, City Bank introduces City Drive, a tailor-made auto loan scheme for individuals.

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Features

Loan amount ranging from Tk. 300,000 to Tk. 20, 00,000

Car financing up to 90% of reconditioned or new vehicle price

Lower interest rate & up to 100% financing for loan against cash security

Loan tenor 12 to 60 months

No hidden charges

Competitive interest rate

Loan processing fee 1% of loan amount

Eligibility

Age: 22 to 60 years

Experience: Salaried executive total 1 year including 6 months with current employer

Experience: Business person/propofessional 1 year

Monthly income: Minimum Tk. 30,000

City solution

Dream Vacation? Son's admission to a foreign university? Medical treatment? Daughter's wedding? House renovation?

Whatever the occasion or requirement may be, City Solution - any personal loan from City Bank - is there to solve all your problems and to fulfill all your dreams. You can access this facility from our selected branches across the country.

Features

Loan amount ranging from Tk. 50,000 to Tk. 1000,000

Loan tenor 12 to 60 months

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No guarantor required for the loan amount up to Tk. 3 lac

No hidden charges

Competitive interest rate

Processing fee 1%

Eligibility

Age: 22 to 60 years

Experience: Salaried executive total 1 year including 6 months with current employer

Experience: Business person 2 years

Experience: Professional 1 year

Minimum monthly income: Salaried executive Tk. 15,000self employed Tk. 25,000 and business person Tk. 30,000

Loan take over plan

An exclusive offer for other bank's credit worthy customers who can now transfer their personal loan outstanding to City Solution with a preferential interest rate and waiver on processing fee.

Eligibility

Minimum 6 loan EMI repayment with existing bank

A minimum take over loan amount is Tk. 1,00,000 and maximum Tk 9,50,000

Benifits

No processing fee

No extra cost for loan takeover

No processing fee for additional loan

1% reduced from City Solution interest rate

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Credit card

City Bank is the first bank to issue Dual Currency Credit Card in Bangladesh. This card enables you simultaneous usage of your card both in home and in abroad. You do not need to carry two different cards for the same purpose.

Features:

Variable Interest Rate

EMI Plan

Balance Transfer

Round the clock cash withdrawal facility at any Visa branded ATM throughout the world

Round the clock purchasing power for goods and services at any Visa branded POS outlet

24% interest on Cash Advance

No cash Advance fee at CITY ATMs

Lowest Annual/Renewal Fee

International Roaming facility

Internet Transaction*

Convenient Repayment option

E-statement

Limited Lost Card Liability

Secured with your Photo – Photo Card

24 hours customer service help desk

Eligibility:

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Bangladeshi Nationals

Age range for primary card holder is 18 years to 60 years

Age range for supplementary card holder is 18 year to 60 years

Age bar can be relaxed for secured cards

Minimum Gross Monthly Income(GMI) for silver card Tk 12,000

Minimum Gross Monthly Income(GMI) for gold card Tk 30,000

Minimum 6 month permanent employment for salaried executives (this indicates total length of service as a total of all companies he or she has worked for), and 1 year of experience in business or practice for self employed professionals and business person

City Credit Cards:

VISA Local Classic

VISA Classic Dual

VISA Gold Local

VISA Gold Dual

Variable Interest Rate

Balance Transfer

City Card EMI Plan

Debit card

CITY Visa Electron Debit Card - By your side, round the clock

Now comes the Visa Debit Card from City Bank. Your life, therefore, becomes hassle-free and safe; and it is Visa Electron branded, which makes you the proud owner of a meaningful plastic.

Features:

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Cash withdrawal from 500+ Visa ATMs 24/7/365 all over the country

Shop and dine at hundreds of merchant Visa outlets all over the country

Balance enquiry

Fund transfer from your account to credit card 24/7/365

PIN Change

Mini statement

Cash withdrawal @ Taka 12 per transaction at 250+ DBBL ATMs

Eligibility:

If you are an individual and have a savings, current or STD account in CBL, you are eligible avail this card. Just drop in any nearby CBL branch, collect an application form and submit duly filled up form. Within shortest time you will get the card delivered at your mailing address or at your designated branch.

Foreign remittance

By your side - all the way

The city Bank's Foreign Remittance unit meets growing customer needs for fast, sucure & easy money transfers to an extensive range of destinations. Being a committed bank to its customers, we go all the lengths to remit your hard earned money safely to your loved ones. With us, apart from a range of high-class modem remittance solutions, you will get peace of mind which we believe counts to most.

Facility

City Bank Limited has 83 online branches across the country; besides, the Bank has a strong remittance network with other major banks of the country. Therefore, wherever your account is, we are able to send your money instantly.

If you are a City Bank account holder, then please visit any of our branches. Our Foreign remittance service personnel will be there to help you out. If you are not an account holder, then please open an account of your choice with us to receive your remittance at earliest convenience.

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CBL understands the value of your precious time. That's why have made the payment procedure simple & easy. You have the privilege of enchasing the remitted money instantly from your branch counter without going through any hassle. That is to say, if you are an account holder of City Bank, we can instantly credit the money to your account or pay cash to the receiver.

So, place your trust with City Foreign Remittance Service. Send your money to your loved ones & experience peace of mind.

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Corporate banking

City Bank is a major player in Bangladesh wholesale banking industry to offer the full scope of innovative, customized solutions and services. We offer service at the highest level. Our focus is not on short-term profit, but on building long-term relationships and standing by our clients whenever they need us.

We have a unique business focus on enabling project financing, trade, investment and supply chain financing for clients. We aim to be a one-stop gateway for corporate and financial institutions looking to extend their business. And we are committed to using our country wide network to facilitate our clients’ growing trade and investment flows and supply chain financing needs across our business footprint.

We focus exclusively on corporate and institutional clients domiciled or conducting business in our footprint, offering clients access to our extensive branch network and award-winning suite of state of the art services.

City Bank fully understands the importance of time, convenience and efficiency to the success of your business. We make easy the complex financial world for you and help you maximize every opportunity.

Capital finance

Overdraft:

A convenient and flexible form of short-term financing for routine operating expenses and overheads of your company.

Guarantees and Bonds:

City Bank issues a full range of Performance Guarantees, Advance Payment Guarantees, and Financial Guarantees and Bid bonds for supporting the underlying business of our customers.

Trade Finance

City Bank’s trade finance is tailored to meet the individual needs of your business. We can help even if your company has limited unstructured credit lines, due to reasons such as limited financial resources or sudden spike requirements. That’s because our risk evaluation focuses more on your performance track record, existing performance and collateral valuation.

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Imports:

Letter of Credit:

When buying goods from overseas suppliers, you will wish to receive the goods as ordered in the right quantity, on time and at the designated place. You will also wish to make payments only after receipt of the required documents including the title of goods.

We can solve your needs by issuing a documentary credit on your behalf. A documentary credit is our Bank's guarantee of payment for a shipment of goods against specific documents as stipulated on it.

By using a Letter of Credit, we will only make payment after receipt of titles and other documents that should fully comply with the terms of the credit. You can enjoy a safer and cheaper alternative to making advance payment or deposits.

Back-To-Back Letter of Credit:

If you are an intermediary and your supplier wants to sell on documentary credit term only, you may apply for the issuance of a Back-to-Back Letter of Credit from us against the export Letter of Credit.

A Back-to-Back Letter of Credit is issued against the export credit (the master credit), but the terms and conditions may not the same as the export credit. You must submit your own draft and invoice, together with the other shipping documents presented by your supplier to secure payment under the export credit. After processing, you will have the export proceeds to pay your supplier and the balance credited to your account.

Deferred Letter of Credit:

A DC which allows the nomination of a bank, or the issuing bank to effect payment against stipulated documents at a maturity date as specified or determinable from the wording of the credit. With this you are able to receive the goods now and pay later.

Import bills for collection:

By informing your supplier to send their shipping documents to City Bank, you will enjoy prompt advice upon our receipt of documents and efficient payment according to your instructions.

Shipping Guarantee:

To operate your business efficiently, it is vital your goods be cleared expeditiously. By issuing a shipping guarantee in the shipper’s favour, City Bank facilitates prompt clearance of goods until bills or lading is received.

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Import Financing:

City Bank will be able to provide financing solutions to pay for the supplier’s documents under letter of credit or import collections. Open account invoice financing is also available.

Performance bonds and other guarantees:

City Bank offers tailored solutions to meet all your performance bond and guarantee needs.

Exports:

If you are in the export business, we can help you with Export L/C advising, L/C Safekeeping, L/C Confirmation, L/C Checking and Negotiation. For financing solutions, tap on to Pre-shipment Export Finance, Export Bills for Collections, Invoice Financing. Outsource your administrative functions to City Bank’s document preparation service.

Export letter of credit advising:

Benefit from prompt advising of export letter of credit from a wide international network through City Bank.

Export letter of credit safekeeping:

Rather than be inconvenienced by having to come to the bank to collect your export letter of credit, City Bank will safe keep your original and send you a working copy to facilitate the preparation of documents.

Export letter of credit confirmation:

Exporters may deal not only with unknown foreign buyers, but also with their banks which are less well known institutions and whose letter of credit (LC) may not be sufficient comfort. By requesting City Bank to confirm your export LCs, you obtain our guarantee of payment for document presented in compliance with the credit.

Pre-shipment export financing:

We provide pre-shipment finance against irrevocable letters of credit from or purchase orders in a number of currencies to allow you to trade with confidence. If you need to fulfill a sales contract but need funds to purchase raw materials or process goods for export, City Bank offers you pre-shipment export financing in a variety of currencies.

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Letter of credit checking and negotiation:

City Bank’s thorough checking standards will reduce the chances that your documents will be rejected. Strict service standards are applied to ensure that your documents are negotiated and dispatched quickly.

Export bills for collection:

Simplify dispatch tracking of payment and reconciliation of your export collections when you choose City Bank’s documents against acceptance, documents against payment or clean collections. Discounting of export collections is also available.

Export invoice financing:

To tide over any cash flow problems arising from credit terms to the buyers, the exporter may obtain invoice financing pending buyers’ payment.

Document preparation:

Benefit from lower costs, faster processing and fewer errors - outsource to City Bank the paperwork and administrative functions related to your export activities based on your letter of credit or purchase order.

Short and Mid-term Finance

Short Term Financing:

As the responsive player in market, you may anytime need fund to utilize for a very short time due to either emergency or short term projects.

In such case, City Bank is there to facilitate you. This can be a Short Term Loan or a Short Term Revolving Loan. You can get it either for your inland business or cross-border payment in foreign trade.

Mid Term Financing:

City Bank can also equip you the required fund for a longer period. If you worry about fund requirement for a bit longer, ‘City Bank Term Loan’ will make you feel confident that, you got a friend for this.

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Project finance

City Bank has been very active in the

Our project financing solutions:

mitigate sponsor exposure to project risk

enhance use of leverage to increase project returns by lowering the weighted average cost of capital

provide access to significantly longer tenor debt financings

create optimum financing structures (source of debt, currency, derivatives) that take into account your company’s particular capital needs as well as industry specific issues.

Lease and Long Term Loans:

We can customize a Term Loan or Lease to finance the fixed assets that your business needs (such as land, new premises, equipment and machinery). It may be a greenfield project or an expansion of an existing plant, that may be financed at competitive floating rate of interest.

Structured finance

A leading provider of cost-efficient, lease-based and asset-based financing solutions to businesses in Bangladesh, we can create and tailor the right structured solutions for your business needs in order to enhance shareholders’ wealth and your market competitiveness.

These solutions include:

Structured financing solutions:

Principal to principal structured capital market transactions optimizes investment returns and reduces effective funding costs.

Syndications:

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This normally involves getting a group of banks together (forming a syndicate) to provide the loan amount required by the customer under a set of common terms and conditions laid down in a loan agreement.

Choose City Bank and you gain access to full loan origination, distribution and trading capabilities, together with an unrivalled ability to match lenders and borrowers. Our leadership position and world class distribution capability result from the team’s ability to read the market, and to provide superb sell down coverage.

Local know-how:

Our intimate knowledge of the diverse industries as well as understanding and working with regulatory bodies, means we can provide you with a solution designed solely to meet your needs.

We also partner our clients to arrange syndicated loan facilities for project finance, aircraft finance, structured trade and acquisition financing including leveraged buy-outs.

We have been successful in loan capital raisings for financial institutions, real estate development, hotels, telecoms, institutional banking and finance, public utility, oil and petroleum, light manufacturing and food sectors.

Your partner for success:

We have a proven track record in devising innovative capital-raising structures that exceed our clients' expectations. Our tailored solution for your business could include:

Working capital and corporate funding

Commodity and trade finance

Islamic structures

Project finance

Structured, complex and tax-efficient capital raisings

Cash Management

In today's competitive financial environment, effective cash management has become a critical success factor. This is the right time to have integrated cash management solution.

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Our cash management services include local and cross border payments, collections, information management, account services, liquidity management and investment services for both corporate and institutional clients.

Payment Services

We can help you save time and money by reducing processing costs while providing a value-added service to your suppliers.

City Bank’s payment solutions can help to reduce your overall processing costs – for domestic and global payments – saving you time and money while providing a value-added service to your suppliers. Our comprehensive payment services will be tailored to enhance your accounts payable process. This will eliminate many manual tasks involved in making payments, allowing you and your staff to spend more time focusing on your core business needs.

We understand that most of your effort in the payment cycle is directed towards initiation; difficulties in the subsequent reconciliation process can jeopardize the whole process. With City Bank Channels you can now track the exact status of each payment through timely reports that can be uploaded seamlessly into your company’s system.

Collection Services:

We have a comprehensive branch network and the local knowledge to help you with lower costs and greater efficiency.

The City Bank Collections Solution leverages the Bank's extensive regional knowledge and widespread branch network across our key markets to specially tailor solutions for your regional and local collection needs.

This Collections Solution, delivered through a standardized international platform, has the flexibility to cater to your local needs, thus enabling you to meet your objectives of reducing costs and increasing efficiency and profitability through better receivables and risk management. The key components of our solution include the following:

Liquidity Management

Let us help you to get the most out of your company’s cash resources with physical sweeping, notional pooling, interest reallocation and investment.

Investment banking

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We are a market leader across our footprint in innovative, landmark deals, multi-jurisdiction solutions and sophisticated product structuring for corporate and institutional clients. We hold leading positions in fixed income local currencies and loan syndications. Our in-depth understanding of the local regulatory framework in the domestic debt and loan markets, product expertise and wide geographic reach, help you achieve your financing and investment objectives.

Debt Capital Markets

Our proven knowledge, product capabilities and global reach make us well-suited to matching investors’ needs with the funding requirements of international and domestic issuers.

Asset Backed Securities

We structure, arrange and distribute asset-backed and future flow transactions for clients and our track record of innovative deals puts us at the forefront of developing securitization markets in our footprint.

Credit Derivatives

We offer investment tools and a range of local currencies to provide structured asset solutions to meet specific investment needs, achieve target yields on your portfolio and manage risk exposure.

Convertible Bonds / Equity Derivatives

Our convertible bonds and equity derivatives teams open avenues of financing and investing linked to the equity asset class - all underpinned by local market knowledge, deep client relationships and innovation

SME banking

SME Banking of City Bank is assuming a new and modern dimension. It is entering in to a wider horizon. The philosophy of extending banking services to SME's of the country is to meaningfully push every one of them up to the next level of respective business operations. The upward push would be meaningful as they would be business wise competitive for a sustainable future. It is therefore would be turning in to an abode of SME's to grow to the next level. Hence, the bank has named it City Business - for taking SME's to the next level.

For the first time in the history of CityBank, SME Banking business processes are going to be driven thru a centralized platform model. This is a fundamental move away from a

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25 years legacy system of decentralized geography based branch banking model. We all know this transformation process and momentum is already in place. This would be completed by 2008.

For more details please contact with our branch nearest to you.

Treasure

City Bank Treasury & Market Risk Division

City Bank Ltd. has a dedicated Treasury team who is capable of providing all treasury Solutions. Through our foreign correspondent business partners CBL is providing a wide range of Treasury products. In CBL Treasury, there are four teams who are specialized in their own area to ensure the best possible solution to our customer requirement. CBL has following teams in the Treasury:

01. Foreign Exchange (Local & G7)

02. Money Market

03. Corporate Sales

04. ALM & Market Research

Each team is dedicated to provide best solutions to their respective areas. Through our four dedicated team we provide the following services:

01. Client Solution & Risk Management

Hedging solutions against adverse market movements

Advice on efficient hedging policy

Structured products to match customers' needs

Corporate Advisory Services

02. Product Range

Foreign Exchange

i. Local Currency spot & Forward*

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ii. G7 Spot & Forward

Money Market

i. Call Money

ii. Term Depositsiii. Securities ( T-Bills, T-Bonds)

iv. Repo & Reverse Repo

Foreign Exchange & FC Interest Rate SWAP

Foreign Currency & Commodity Derivatives

03. Market Information & News Update

Economic Research & Technical Analysis

Market Report ( Daily, Quarterly & Half Yearly)

Overnight deposit

Funds which are placed / borrowed for overnight are known as overnight deposit. Rates of the overnight deposit are fixed on a daily basis and the rate keeps on changing on the basis of demand and supply of any day. It is used to meet up the daily fund management of all financial institutes. Overnight deposit is also known in the market as call deposit.

CBL is an active participant of the inter-bank call market. CBL injects market liquidity and plays an important role in the inter - bank call money market.

Benefits

Due to the nature of product it has minimum credit risk as the tenor is overnight.

Very effective tool to manage daily liquidity management.

Call money rates indicates the market liquidity.

Traded in bulk volume.

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Term Deposit

A deposit held at a financial institution that has a fixed term. These are generally short-term with maturities ranging anywhere from a month to a year. When a term deposit is account are opened, the lender/borrower understands that the money can only be withdrawn after the term has ended or by giving a predetermined number of days notice.

Inter-bank term deposits are considered as relatively safe investment and these are especially very appealing to conservative, low-risk investors who are expecting a adverse interest rate movement.

CBL has a strong presence in the inter-bank term deposits and Mudaraba Term deposits market. Due to our presence in both conventional banking and Shraiah banking CBL is one of the liquidity provider in the inter-bank Term deposit market.

Benefits

Due to its nature of fixed term, it minimizes interest rate risk during the tenor of the deposit.

Helps to manage Balance Sheet Gap.

Reduce too much dependency on call market thus helps to manage regulatory liquidity requirement.

Depending on the forward yield curve can be used to maximize returns on investment.

Foreign Exchange

Foreign Exchange market is known as the market in which currencies are traded. The forex market is the largest, most liquid market in the world with an average traded value that exceeds $1.9 trillion per day and includes all of the currencies in the world. The volume of this market is increasing continuously.

There is no central marketplace for currency exchange; trade is conducted over the counter (OTC). The international forex market is open 24 hours a day, five days a week, and these currencies are traded worldwide among the major financial centers of London, New York, Tokyo, Zürich, Frankfurt, Hong Kong, Singapore, Paris and Sydney

The forex is the largest market in the world in terms of the total cash value traded, and any person, firm or country may participate in this market.

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Local currency spot & forward

Our currency is not fully convertible thus it is not traded across the world. Our currency BDT is traded in our local market and this market is regulated as per our foreign exchange regulation and central bank core risk management guidelines.

The City Bank Ltd. is very active in the inter-bank USDBDT market and one of the leaders among the local private banks. CBL treasury provides market information and competitive price in USDBDT. It has wide source of foreign currency through its Exporter, Exchange Houses and different local and multinational corporate customers. Its dedicated local currency desk is designed to provide tailor made solution for USDBDT trade.

Spot & Forward both are used to manage foreign exchange risk. Forwards, especially in our economy where our local currency BDT devalues periodically against USD, is very popular among the importer to hedge BDT devaluation risk.

Major Currency Spot & Forward

CBL also well equipped to price world major currency spot & forward price. CBL treasury is connected to the international market quotes very competitive prices on world major currency spot & forwards.

Operations of the Bank

Deposits

The bank mobilized total deposits of BDT 39,348.00 million as of December 31, 2007 as compared to BDT 33,332.65 million in 2006. Competitive interest rates, attractive deposit products, deposit mobilization efforts of the Bank and confidence reposed by the customers in the Bank contributed to the notable growth in deposits. The Bank evolved a number of attractive deposits schemes to cater to the requirement of small and medium savers. This improved not only the quantum of deposits; it also brought about qualitative changes in the deposits structure.

Advances

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The Bank has formulated its policy to give priority to small and medium businessmen while financial large-scale enterprises through consortium of Banks. Total loans and advances of the Bank stood at BDT 31,877.86 million as December 31, 2007 as compared to BDT 26,842.14 million in 2006. Trade and commerce, garments industry, large and medium scale industries and construction are major sector in which the Bank extended credit.

Depreciation

Depreciation is charged on freehold properties at the following rates on reducing balance method from the date of acquisition, other than the Vehicles on which straight-line method is applied.

Name of Assets Rate

Land Nil

Furniture and Fixtures 10% p.a.

Office Equipment 20% p.a.

Vehicles 20% p.a.

Books 20% p.a.

Loans and Advances

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Required provisions have been kept against loans and advances as per instructions contained in Bangladesh Bank BRPD circular no. 05 dated June 05, 2006 and BRPD Circular No. 10 dated September 18, 2007 at the following rates:

Particulars Rates

A. For Unclassified Loans and Advances

i) All Unclassified loans (other than loans under Small Enterprise and Consumer Financing and Special Mention Account) 1% ii) Unclassified loans against Small Enterprise financial and Consumer Financial for Housing and professionals (to set up business) 2% iii) Unclassified loans against other Consumer Financing 5% iv) Outstanding amount of loans kept in the ‘special Mention Account’ after netting off the amount of interest Suspense. 5%

B. For Classified Loans and Advances

i) Specific Provision on substandard loans and advances 20%ii) Specific Provision on doubtful loans and advances 50%iii) Specific Provision on bad/loss loans and advances 100%

C. For Off- Balance Sheet Exposures 0.50%

Deposit

Total Deposit of the Bank as on December 31, 2007 stood Tk. 40,540 million against Tk. 40.881 million of the previous year registering a marginal negative growth of Tk.341 million (0.83%). This reduction in deposits was the result of a strategic plan by reducing high interest bearing deposits, to not only reduce interest expense but also to match reduced lending in order to improve NPL of the bank. Deposit position of last years is depicted in the following bar diagram:

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Cost of deposit however, increased during the year under report, due to high interest rate allowed against long term fixed deposit in earlier years. Deposit mix of the bank as on December 31, 2007 along with 2006 comparison is depicted in the table below:

Sl. No. Type of Deposit 2006 2007

Amount Share (%) Amount Share (%)

1. Current & Others 5,815.47 14.23% 7,625.59 18.81%

2. Savings 7,167.83 17.53% 7,761.12 19.14%

3. Short Term 2,829.34 6.92% 3,229.63 7.97%

4. Fixed Deposits 18,324.06 44.82% 16,308.43 40.23%

5. Scheme 6,744.71 16.50% 5,614.86 13.85%

Total Deposit 40,881.41 100.00% 40,539.63 100.00%

Loans and Advances

The loans and advances portfolio of the bank at the end of the year 2007 stood at Tk. 26,788 million with loans diversified in both conventional credit and finance based on Islami Shariah. Total loan volume of the bank during the reviewed year decreased by Tk. 4,001 million, 13% reduction from previous year. The outstanding amount of loans & advances at the same period of previous year was Tk. 30,789 million. A major consolidation effort was undertaken to exit, reschedule, recover deteriorating credits in order to improve NPL, hence this reduction in loans & advances was part of a strategic plan. Last five years loans & advances volume is presented below:

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Loan portfolio allocation, sector wise, for the years 2006 & 2007 is depicted in the table below:

Sl. No. Sector 2006 2007

Amount Share (%) Amount Share (%)

1. Agriculture 147.00 0.48% 5.22 0.02%

2. Large & Medium Industries 4,863.10 15.79% 5,541.25 20.69%

3. Small & CottageIndustries 25.58 0.08% 27.90 0.10%

4. Commerce & Trade 7,947.17 25.81% 10,998.50 41.06%

5. Insurance, Real state & Service 5,732.69 18.62% 2,158.90 8.06%

6. Transport & Communication 238.43 0.77% 284.61 1.06%

7. Other 11,835.04 38.45% 7,772.08 29.01%

Total Deposit 30,789.01 100.00% 26,788.46 100.00%

Net Performing Loans

It is a mammoth task to keep the non performing loans within a sustained level; through a planned strategy of improving real NPLs, your Bank was however able to reduce its non-

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performing loans to Tk. 1,671.83 million compared to Tk. 2,209.73 million in 2006. The NPL ratio was recorded at 6.24% as of end of 2007 compared to 7.18% as of the end of 2006. It should be noted that 2007 NPL ratio improved over that of 2006, deposit reduction in total loans and advances. The following table shows category wise break0down of non performing loans in 2006 and 2007:

Million Taka Sl. No. Classification Type 2006 2007

1. Sub Standard 100.45 348.08

2. Doubtful 175.95 129.86

3. Bad/Loss 1933.33 1,193.89

Total Classified Loan 2,209.73 1,671.83

Recovery of Classified Loan

During the year under review, your bank recovered, including recovery from written off loans, an amount of Tk. 547.77 million compared to Tk. 576.02 million during last year. As per rescheduling policy, your bank rescheduled Tk 889.18 million in 2007. Total recovery amount with rescheduling for the year 2007 stood at Tk. 1,436.96 million compared to Tk. 920.66 million of the previous year. In line with guidelines of write off policy, an amount of Tk. 687.52 million was also written off during the year under review.

The following diagrams depict the bank’s performance vis-à-vis improvements in NPLs as well as recoveries.

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Value Added Statement

For the year ended December 31, 2007

Particulars 2007 2006 Taka % Taka %

Income from Banking Services 5,806,509,476 5,215,179,491 Less: Cost of Services and Supplies (3,590,096,895) (2,891,070,310)

Value added by the Banking Services 2,216,412,581 2,324,109,181

Non-Banking Income 1,045,899 2,245,951 Loan written off and Provision (447,414,118) (841,674,976) Total Value Addition 1,770,044,362 1,484,680,156 Distribution of value Addition

To Employees as Salaries & Allowances 882,946,990 49.88% 469,377,203 31.62%

To Shareholders 343,463,026 19.41% 546,870,344 36.83%

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To Government as Income Tax 465,000,000 26.27% 413,000,000 27.82%

Depreciation 78,616,346 4.44% 55,432,609 3.73%

1,770,044,362 100.00% 1,484,680,156 100.00%

Economic Value Added Statement

For the year ended December 31, 2007

EVA is a measure of profitability which takes into consideration the cost of total invested equity. Shareholders/ equity providers are always conscious about their return on capital invested. As a commercial banking company, we are deeply concerned for delivery value to all of our shareholders/ equity providers.

Particulars 2007 2006 Taka Taka

Share holders Equity 2,874,366,986 2,530,903,960 Add: Provision for Loans and Advances 963,612,192 1,277,292,518

3,837,979,178 3,808,196,478

Earnings

Profit after Tax 343,463,026 240,021,193

Add: Provision for Loans and Others 447,414,118 841,674,976

790,877,144 1,081,696,889

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Average cost of equity (based on weighted average rate Patra issued by the Bangladesh Government plus riskfactor) 13.75% 12.00% Cost of Equity 527,722,137 456,983,577

Economic Value Added 263,155,007 624,713,312

Balance Sheet

As at 31 December 2007

Property and Asset 2007 2006 Taka Taka

Cash

In hand (including foreign currencies) 771,568,562 475,924,568 Balance with Bangladesh Bank and 2,705,998,489 2,350,473,440 Its agent bank(s) (including foreign currencies) 3,477,567,051 2,826,398,008

Balance with other banks and financial institutions

In Bangladesh 4,672,954,417 1,438,813,121Outside Bangladesh 109,529,003 135,657,686

4,782,474,420 1,574,470,807 Money at call and short notice 1,830,000,000 1,435,000,000

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Investments Government 7,094,714,100 5,873,020,642 Others 455,892,392 532,064,208

7,550,606,492 6,405,084,850Loans and advances Loans, Cash credit, overdraft etc. 25,039,792,708 27,040,242,081 Bills purchased and discounted 1,748,673,430 3,748,779,901

26,788,466,138 30,789,021,982Fixed assets including premises,furniture and fixtures 1,390,732,198 1,282,090,427Other assets 2,935,556,719 3,133,685,810Non-banking assets - -

Total assets 48,755,403,018 47,445,751,884

LIABILITIES AND CAPITALSLiabilitiesBorrowing from other banks, financialInstitution and agents 850,000,000 Deposit and other accounts Current deposit and other accounts 6,735,767,915 5,221,288,738 Bills payable 889,821,320 594,785,472 Saving bank deposits 7,767,124,764 7,167,831,748 Fixed deposits 25,152,920,036 27,898,108,479 Bearer certificate of deposit - -

40,539,634,035 40,881,413,837

Other liabilities 4,491,401,997 4,033,434,087

Total liabilities 45,881,036,032 44,974,847,924

Capital / Shareholders equityPaid up capital 1,188,000,000 1,080,000,000Statutory reserve 896,948,006 735,255,401Other reserve 573,104,088 573,104,088Surplus in profit and loss account / Retained earnings 38,114,892 34,544,471Proposed dividend (stock) 178,200,000 108,000,000

Total Shareholders equity 2,874,366,986 2,530,903,960

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Total liabilities and Shareholders equity 48,755,403,018 47,445,751,884

OFF-BALANCE SHEET ITEMS

Contingent liabilities

Acceptances and endorsements 847,890,070 1,090,738,041

Letters of guarantee 1,569,361,688 1,830,293,797

Irrevocable letters of credit 2,622,378,064 4,518,970,170

Bills for collection 3,211,005,932 5,461,568,637

Others contingent liabilities - -Total 8,277,635,754 12,901,570,645

Profit and Loss Account For the year ended 31December 2007

2007 2006 Taka Taka

Interest income / profit on investments 4,183,260,712 3,772,069,319Interest / profit paid on deposits and borrowings etc (3,235,362,655) (2,567,271,785)

Net interest / net profit on investments 947,898,057 1,204,797,534Investment income 860,271,122 431,448,405Commission, exchange and brokerage 532,246,444 756,731,706Other operating income 231,777,097 257,176,012

Total operating income (A) 2,572,192,720 2,650,153,657

Salaries and allowances 877,594,990 771,990,634Rent, taxes, insurance, electricity etc. 141,269,481 122,374,347Legal expenses 9,882,321 7,874,625Postage, stamp, telecommunication etc. 25,868,331 28,625,396Stationery, printing, advertisements etc. 52,143,307 40,616,762Chief Executive’s salary and fees 5,370,000 4,235,000Directors’ fees 892,000 853,000Auditors’ fees 792,375 274,000Depreciation and repair of Bank’s assets 115,733,404 93,020,263

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Other expenses 86,832,367 85,592,341

Total operating expenses (B) 1,316,315,576 1,155,456,768

Profit / (loss) before provision (C=A-B) 1,255,877,144 1,494,696,889

Provision for loans advances / investments

Specific provision (134,999,808) (758,428,806)General provision (162,100,192) (83,246,170)Total provision for loans and advances / investment (297,100,000) (841,674,976)Provision for Off-Balance Sheet exposures (45,000,000)Provision for gratuity (50,000,000)Provision for diminution in value of investments (10,108,000)Other provision (45,206,118)

Total provision (D) (447,414,118) (841,674,976)

Total profit / (loss) taxes (C-D) 808,463,026 653,021,913Provision for taxation (125,000,000) (413,000,000)Current tax (279,000,000)Previous years tax (50,000,000)

Deferred tax (465,000,000) (413,000,000)

Net profit after taxation 343,463,026 240,021,913Retained earning brought forward from previous year 34,544,471 33,172,558

378,007,497 273,194,471

Appropriations

Statutory reserve 161,692,605 130,650,000Proposed dividend (stock) 178,200,000 108,000,000

339,892,605 238,650,000

Retained surplus 38,114,892 34,544,471

Earnings per share (EPS) 28.91 20.20

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Cash Flow Statement

For the year ended 31 December 2007

A) 2007 2006 Taka Taka

Interest receipts in cash 4,060,027,793 3,669,260,800Interest payments (3,089,944,490) (2,224,779,585)Dividend receipts 9,152,956 13,508,142Fees and commission receipts in cash 273,225,031 360,283,167Recoveries of loans previously written off 18,415,068 18,099,288Cash payments to employees (882,964,990) (776,225,634)Cash payments to suppliers (22,502,530) (25,583,203)Income taxes paid (610,287,020) (735,110,965)Receipts from other operating activities 1,082,895,263 675,116,275Payments for other operating activities (332,231,710) (298,215,322)Cash generated from operating activities before changes in operating assets and liabilities 505,785,371 676,352,963

Increase / (decrease) in operating assetsand liabilities

Statutory deposits - -Purchase of trading securities (Treasury bills) - -

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Loans and advances to other banks - -Loans and advances to customers 4,000,555,844 (7,462,683,432)Other assets 912,363,334 (1,022,490,397)Deposits from other bank / borrowing 659,173,232 260,451,488Deposits from customers (150,953,034) 9,817,045,160Other liabilities account of customers - -Trading liabilities - -Other liabilities (598,993,745) (103,262,308)

4,822,145,631 1,489,060511

Net cash from operating activities 5,327,931,002 2,165,413,474

B)

Cash flows from investing activities

Debentures - -Proceeds from sale of securities 76,171,816 -Payments for purchases of securities - (85,855,162)Purchase / sale of property, plant and equipment (187,258,117) (240,137,363)Payment against lease obligation - -Proceeds from sale of property, plant and equipment - -

Net cash used in investing activities (111,086,301) (325,992,525)

C)

Cash flows from financial activities

Dividend paid - -

Net Cash from financing activities - -

D)Net increase / (decrease) in cash and cash equipments (A+B+C) 5,216,844,701 1,839,420,949E)Effects of exchange rate changes on cash and cash equipment 259,021,413 396,448,539

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F)Cash and cash equivalents at beginning of the year 11,708,889,457 9,473,019,969

G)Cash and cash equivalents at end of the year 17,184,755,571 11,708,889,457(D+E+F)

Cash and cash equivalents at end of the yearCash in hand (including foreign currencies) 771,568,562 475,924,568Balance with Bangladesh and its agent bank(s) 2,705,998,489 2,350,473,440(including foreign currencies)Balance with other banks and financial institutions 4,782,474,420 1,574,470,807Money at call and short notice 1,830,000,000 1,435,000,000Government securities 7,094,714,100 5,873,020,642

17,184,755,571 11,708,889,457

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Loans and advances/ investments

a) loans and advances of conventional Banking / investments of Islamic Banking branches are stated in the balance sheet on gross basis.

b) Interest / profit is calculated on a daily product basis but charged and accounts for on accrul basis. Interest / profit on classified loans and advances/ investments is kept in suspense account as per Bangladesh Bank instructions and such Interest / profit is not accounted for as income until realised from borrowers. Interest / profit is not charged on bad and loss loans / investments as per guidelines of Bangladesh Bank . Records of such interest amount are kept in seperate memorandum accounts.

c) Provision for loans and advances/ investments is made on the basis of quarter-end review by the management following instructions contained in Bangladesh Bank BCD Circular no. 34 dated 16 November 1989, BCD Circular no. 20 dated 27 December 1994, BCD Circular no. 12 dated 4 September 1995, BRPD Circular no. 16 dated 6 December 1998, BRPD Circular no. 9 dated 14 May 2001, BRPD Circular no. 02 dated 06 December 2005. The classification rates are given below :

General provision on unclassified loans & advances / invesments 1%General provision on unclassified small % medium enterprise financing 2% General provision on unclassified loans / invesments for housing finance and on loans for professions 3%

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General provision on unclassified consumer financing other than housing finance and loans for professions 5%General provision on special mention account 5%Specific provision on substrandard loans and advances / invesments 20%Specific provision on doubtful loans and advances / invesments 50%Specific provision on bad / loss loans and advances / invesments 100%

Fixed assets and depreciation

a) All fixed assets are stated at cost less accumulated depreciation as per BAS-16 “ Property. Plant and Equipment”.

b) Depreciation is charged for the year at the following rates on straight line method on all fixed assets and no depreciation on land is charged:

Category of fixed assets Rate Land Nill Building 2.50% Furniture and fixtures 10% Office equipment 20% Software 5% Vehicles 20%

c) For additions during the year, depreciation is charged days of the year and for disposal depreciation is charged up to the date of disposal. d) Land was revalued in the year 2006. Detail information regarding revalution has been shown in the notes to the accounts.

General

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A) These financial statements are presented in Taka, which is the Bank’s functional currency. Figures appearing in these financial statements have been rounded off to the nearest Taka.

B) The expenses, irrespective of capital or revenue nature, accured / due but not paid have been provided for in the books of the Bank.

C) Figure of previous year have been rearranged whenever necessary to conform to current years presentation.

D) The external auditors of the Bank, M/s. Howladar Yunus & Co. Chartered Accountants worked in excess of 4,876 man hours at the Bank’s Head Office different branches. During their sudit, they audited above 80% of the Bank’s risk weighted assets as on the reporting date.

E) All previous year figures for comparative purposes are those of The City Bank Limited only.

Cash 2007 2006

Taka TakaCash in handIn local currency 713,887,282 439,131,304In foreign currency 57,681,280 36,793,264

771,568,562 475,924,568

Balance with Bangladesh Bank and its agent bankIn local Currency 2,366,585,485 2,515,054,010In foreign currency (9,801,033) 18,527,453

2,357,057,452 2,169,581,463Sonali Bank Ltd. as agent of Bangladesh Bank(Local Currency) 274,078,621 128,551,531Sonali Bank Ltd. other than agent of BangladeshBank (Local Currency) 74,862,416 52,340,446

348,941,037 180,891,977

2,705,998,489 2,350,473,440

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Foreign currency balance with Bangladesh Bank on December 31, 2007 was negative due to an unresponded entry, which was responded on the following data and the balance become positive on that date.

Cash Reserve Requirement (CRR) and statutory Liquidity Ratio (SLR)

Cash Reserve Requirement and statutory Liquidity Ratio have been calculated and maintained in accordance with section 33 of Bank Companies Act, 1991 and BRPD circular no. 11 and 12, dated August 25, 2005.The minimum Cash Reserve Requirement on the Bank’s time and demand liabilities at the rate of 5% has been calculated and maintained with Bangladesh Bank in current and 18% Statutory Liquidity Ratio, including CRR, on the same liabilities has also been maintained in the form of treasury bills, bonds and debentures including FC balance with Bangladesh Bank. Both the reserves maintained by the Bank are in excess of the statutory requirements, as shown below:

2007 2006 Taka Taka

Cash Reserve RequirementRequired reserve 2,171,060,000 1,945,317,000Actual reserve maintained 2,201,544,235 1,957,657,000

Surplus / (deficit) 30,484,235 12,340,000

Statutory Liquidity RatioRequired reserve (including CRR) 7,821,976,000 7,008,262,000Actual reserve maintained (including CRR) 10,696,769,000 8,370,218,335

Surplus / (deficit) 2,874,793,000 1,361,956,335

Total required reserve 7, 821,976,000 7,008,262,000Actual reserve held 10,696,769,000 8,370,218,335

Total Surplus 2,874,793,000 1,361,956,335

Held for Statutory Liquidity RatioCash in hand 478,329,000 439,073,804Balance with Bangladesh Bank and its agent bank(S) 2,537,777,000 2,086,208,531Government securities and bonds 7,680,663,000 5,844,936,000

10,696,769,000 8,370,218,335

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Balance with other banks and financial institutionsIn Bangladesh 4,672,945,417

1,438,813,121Outside Bangladesh 109,529,003 135,657,686

4,782,474,420 1,574470,807

In BangladeshCurrent account

Janata Bank Ltd. 202,806 3,602,806Agrani Bank Ltd. 14,239,491 16,890,867Standard Bank Ltd. - 4,531United Commercial Bank Ltd. 2,549,620 2,552,420Bangladesh Krishi Bank 200,000 -

17,191,917 23,050,624

2007 2006 Taka Taka

Short-term deposit accounts

Social Investment Bank Ltd. 29,890 14,682Standard Bank Ltd. 3,891 -Standard Chartered Bank 7,870,974 11,412,122

7,904,755 11,426,804Savings accountsSocial Investment Bank Ltd. Dhaka 493,745 480,693

493,745 480,693

Fixed deposit receipts

Phoenix Finance & Investments Ltd.* 247,355,000 247,355,000Bangladesh Industrial Finance Company Ltd. 20,000,000 20,000,000IDLC Finance Limited - 6,500,000International Leasing Co. Ltd. 200,000,000 200,000,000Industrial Promotion and Development Co. ofBD. Ltd. (IPDC) - 100,000,000

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Industrial & Infrastructural Development FinanceCompany Ltd. (IIDFC) 140,000,000 140,000,000National Housing Finance and Investment Co. Ltd. - 20,000,000Uttara Finance and Investment Ltd. 250,000,000 100,000,000Farest Finance & Investment Ltd. 20,000,000 20,000,000Islamic Finance and Investment Ltd. 120,000,000 -Dutch Bangla Bank Ltd. - 200,000,000Merchantile Bank Ltd. 650,000,000 300,000,000First Security Bank Ltd. - 50,000,000Dhaka Bank Ltd. 750,000,000 -BRAC Bank Ltd. 500,000,000 -AB Bank Ltd. 600,000,000 -Prime Bank Ltd. 150,000,000 -Bank Asia Ltd. 400,000,000 -One Bank Ltd. 300,000,000 -Jamuna Bank Ltd. 200,000,000 -Habib Bank Ltd. 100,000,000 -

4,647,355,000 1,403,855,000

4,672,945,417 1,438,813,121

* Term deposits amounting Tk. 22,355,000 is under lien against Lease Obligation

Payable

2007 2006 Taka Taka

Money at Call and short notice

Banking company

Sonali Bank Ltd. - 400,000,000BRC Bank Ltd. - 100,000,000The Oriental Bank Ltd. 100,000,000 100,000,000Eastern Bank Ltd. 200,000,000 200,000,000One Bank Ltd. - 150,000,000Bangladesh Krishi Bank - 300,000,000United Commercial Bank Ltd. - 50,000,000IFIC Bank Ltd. 150,000,000 100,000,000Mutual bank Ltd. 300,000,000 -Bank Asia Ltd. 200,000,000 -Uttara Bank Ltd. 500,000,000 -

1,450,000,000 1,400,000,000

Non-banking finance institutions

Phoenix Finance & Investments Ltd. - 20,000,000Phoenix Finance & Investments Ltd. - 15,000,000

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Investment Corporation of Bangladesh 250,000,000 -Industrial Promotion and Development Company of Bangladesh Ltd. 50,000,000 -Fareast Finance & Investment Co. Ltd. 30,000,000 -National Housing Finance and Investment Co. Ltd. 50,000,000 -

380,000,000 35,000,000

1,830,000,000 1,435,000,000

Investments

Investment securities are classified as follows

a) Government securities

28 days treasury bills - 458,267,3622 years treasury bills - 235,405,6505 years treasury bills 727,208,490 2,251,411,930Reverse repo with NCC Bank Ltd. 250,000,000 -

977,208,490 2,945,084,942

2007 2006 Taka Taka

b) Government bonds

Prize bonds 6,305,500 6,152,200 Government bonds 6,111,200,110 2,921,783,500

6,117,505,610 2,927,935,700

7,094,714,100 5,873,020,642

c) Other investments

Debenture of Bangladesh Welding Electrodes Limited 368,000 368,000 Debenture of IDLC Finance Limited 100,000,000 100,000,000 ULC Securitized Bond 11,486,850 25,871,645 IDLC Asset Backed Bond 3,764,337 11,024,925 BRAC Securitization Bond 7,657,104 69,944,482 Shares 332,616,101 324,855,156

455,892,392 532,064,208

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7,550,606,432 6,405,084,850

Maturity grouping of investments

On demand - 181,375,356Over 1 month but not more than 3 months - 507,976,212Over 3 months but not more than 1 years 549,144,913 1,307,020,240Over 1 year but not more than 5 years 2,755,158,158 2,516,840,842Over 5 years 4,246,303,421 1,891,872,200

7,550,606,492 6,405,084,850

Government bonds

Name of the bonds

3 years T&T Treasury bonds - 150,000,0005 years Treasury bonds 2,224,032,700 964,911,30010 years Treasury bonds 3,346,067,410 1,741,872,20015 years Treasury bonds 486,100,000 -Debentures of Bangladesh House Building FinanceCorporation (bearing interest rate @ 5.5%) 40,000,000 45,000,000Debentures of Investment Corporation of Bangladesh (bearing interest rate @ 5%) 15,000,000 20,000,000

6,111,200,110 2,921,783,500

2007 2006 Taka Taka

Debentures of Bangladesh House Building

Finance Corporation – at redeemable value

Principal 100,000,000 100,000,000Redeemed up to 31 December 2007 60,000,000 55,000,000Redeemed value 40,000,000 45,000,000

Debentures of Investment Corporation of Bangladesh- at redeemable value

Principal 50,000,000 50,000,000Redeemed up to 31 December 2007 35,000,000 30,000,000Redeemed value 15,000,000 20,000,000

Loans and advances / investments

i) Loans, cash credits, overdrafts etc.

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Inside Bangladesh

Secured overdraft 2,243,144,722 2,398,290,438Quard against TDR 9,347,508 21,208,170Cash credit 6,650,487,648 7,476,165,137Murabaha 31,393,741 22,687,892Loans 23,967,722 47,022,773House building loans 272,106,278 432,765,912Loans against trust receipt 2,484,080,608 3,261,724,130Loans against imported merchandise 424,050,119 661,037,983Payment against document 242,846,963 804,246,946Consumer credit scheme 34,792,449 52,182,056Lease finance / Izara 269,740,360 245,715,677Hire purchase shirkatul melk 395,227,122 275,331,881Bai-Salam 1,439,550 -Musharska - 8,269,992Industrial credit 8,849,321,383 8,408,021,471Export development fund 66,313,409 89,379,833Staff loan 662,088,222 436,837,660City card loans* 251,081,080 220,340,433Small and medium enterprise loans 399,008,851 439,213,591Transportation loans 284,611,303 280,131,555Bai-muajjal 138,363,073 282,578,138Other loans and advances 1,306,380,597 1,177,090,413

25,039,792,708 27,040,242,081

2007 2006 Taka Taka

Outside Bangladesh

ii) Bills purchase and discounted

Payable Inside Bangladesh

Inland bills purchased 1,470,581,439 2,753,431,358

Payable Outside Bangladesh

Foreign bills purchased and discounted 278,091,991 995,348,543

1,748,673,430 3,748,779,901

26,788,466,138 30,789,021,982

Performing loans and advances / investments

Gross loans and advances / investments 26,788,466,138 30,789,021,982Less:Non-performing loans and advances / investments 1,671,833,000 2,209,732,000Interest suspense 352,005,997 277,219,774

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Provision for loans and advances / investments 963,612,192 1,277,292,518

2,387,451,189 3,764,244,292

23,801,014,949 27,024,777,690

*City Card loans represents the legitimate claims raised against credit card up to

December 30, 2007.

Loans and advances / investments

Loans 16,105,419,090 17,121,890,445Cash credits 6,681,881,388 7,498,853,028Overdrafts 2,252,492,230 2,419,498,608

25,039,792,708 27,040,242,081Bills purchase and discounted 1,748,673,430 3,748,779,901

26,788,466,138 30,789,021,982

2007 2006 Taka Taka

Loans and advances / investments –

geographical Location- wise

Inside Bangladesh

Urban

Dhaka 20,662,930,175 2,825,571,554Chittagong 3,348,073,259 4,843,607,625Sylhet 194,397,281 222,263,291Bogra 1,144,784,030 1,281,693,892Khulna 1,016,169,218 1,191,150,541

26,366,353,963 30,364,286,903

RuralDhaka 194,140,066 198,905,687Chittagong 154,231,852 163,789,235Sylhet 32,394,918 23,134,689Bogra 41,345,339 38,905,468Khulna - -

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422,112,175 424,735,079

Outside Bangladesh - -

26,788,466,138 30,789,021,982

Sector-wise loans / investments includingbills purchase and discounted

Public sector - -Co-operative sector - -Private sector 26,788,466,138 30,789,021,982

26,788,466,138 30,789,021,982

2007 2006 Taka Taka

Deposits and other accounts

Current deposits and other accounts

Current / Al-wadeeah current deposits 5,112,087,783 3,275,830,083Foreign currency deposits 91,265,878 102,719,312Security deposits receipts 73,279,474 87,050,259Sundry deposits 1,459,134,780 1,755,689,084

6,735,767,915 5,221,288,738

Bills payable

Pay orders issued 742,575,283 484,396,486Pay slips issued 33,831,215 23,076,830Demand draft 112,838,614 418,208T.T. payable 576,208 86,293,948

889,821,320 594,185,472

Saving bank deposits 7,761,124,764 7,167,831,148

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Fixed deposits

Fixed deposits / Mudaraba fixed deposits 16,308,429,606 18,324,063,772Short term deposits / Mudaraba short noticedeposits 3,229,631,684 2,829,338,967Non resident taka deposits 72,186,116 1,309,468,318Scheme deposits 5,542,672,630 5,435,237,422

25,152,920,036 27,898,108,479

40,539,634,035 40,881,413,837

Sundry Deposits

Sundry creditors 135,219,278 196,810,942Foreign currency 802,525 980,129Margin on L/C 249,029,344

490,160,899Margin on L/G 181,278,269 166,466,905Interest payable on three stage deposits 485,155,150 351,557,335Foreign correspondence charges 14,474,210 11,649,466Sanchaypatra 44,016,563 73,265,000Unclaimed foreign DD 52,425 -Security money- Supplies 18,472,812 -Security money- Staff 680,628 -Unclaimed balances 212,770 212,655Hajj deposits 194,597 194,597

2007 2006 Taka Taka

Margin on inland purchased 1,832,942 65,197,356Foreign bills purchased awaiting remittance 304,797,872 382,374,528Imprest fund- Cash Incentive 1,165,347 520,764Key deposits 713,200 586,500Risk deposits (consumer Credit Schemes and Lease finance) 3,744,910 2,471,663Lease deposits 12,664,269 12,136,512Agent commission on Consumer Credit Schemes 232,766 228,144CIB service charges 89,350 72,050Currency settlement 349,936 -Late payment charge 324,665 -Excess over limit charge 443,324 -Charge back 1,029,056 -Auto debit receipt/ payment (credit Card) 2,105,099 -Others 55,473 803,639

1,459,134,780 1,755,689,084

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Saving bank deposits

Savings bank deposits 7,525,568,887 6,718,782,651Mudaraba savings deposits 235,555,877 449,048,497

7,761,124,764 7,167,831,148

Scheme deposits

City Bank sanchaya scheme 639,444,630 826,553,517Bonus deposit scheme 18,300,000 96,100,000Deposit pension scheme 68,114,500 61,474,804Three stage scheme deposit 2,729,356,230 1,930,732,221Monthly benefit scheme 1,910,450,000 2,424,448,980Education savings scheme 28,086,312 20,859845Junior saving scheme 87,830,562 50,065,224Lakpati saving scheme 25,834,371 9,498,048Marriage savings scheme 20,258,340 15,004,783Mudaraba monthly profit 1,600,000 500,000City ichchapuron 13,200,000 -City projonmo 197,685 -

5,542,672,630 5,435,237,422

Deposit pension scheme was closed from the year 1995 and its interest was 15% p.a.

2007 2006 Taka Taka

Sector-wise deposits

Government 525,900,931 718,281,178Deposit money banks 241,316,025 432,142,793Other public 2,752,608,193 3,009,854,344Foreign currency 91,265,878 102,719,312Private 36,928,543,008 36,618,416,210

40,539,634,035 40,881,413,837

Maturity analysis of inter-bank deposits

Payable on demand 37,277,989 48,189,811Up to 1 month 40,807,607 21,103,607Over 1 month but within 3 months 61,211,410 362,849,375Over 3 month but within 1 year 102,019,019 -

241,316,025 432,142,793

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Maturity analysis of other deposits

Payable on demand 7,396,591,154 7,151,160,548Up to 1 month 4,934,026,635 5,315,828,489Over 1 month but within 6 months 10,691,746,790 13,496,053,335Over 6 months but within 1 year 12,035,691,374 8,647,927,820Over 1 year but within 5 years 3,975,016,658 4,154,188,703Over 5 years but within 10 years 375,424,079 1,089,926,677Over 10 years - -

39,408,496,690 39,855,085,572

Maturity analysis of other deposits (bill payable)

Payable on demand 889,821,320 594,185,472Up to 1 month - -Over 1 month but within 3 months - -Over 3 months but within 1 years - -Over 1 years but within 5 years - -Over 5 years but within 10 years - -Over 10 years - -

889,821,320 594,185,472

40,298,318,010 40,449,271,044

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SWOAT ANALYSIS :

Strengths

Satisfactory business growth.

Experienced top management

Diversified product lines

Equity base enhancement decision

No short fall in Capital Adequacy

Satisfactory NPL coverage

Strong Capital base

Experienced management team

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Diversified funding sources

Outstanding market share

Corporate shareholding structure

Diversified business exposure

Weaknesses

Declining Asset Quality

Average Profitability

Tight Liquidity position

MIS at primary stage

Limited market share

Poor Corporate Governance

Significant deterioration in Asset Quality having adequate provisions

High ownership concentration

Declining financial performance

MIS needs further development

Single unit Financial Institution

High turnover in top & mid tier management

Opportunities

Satisfactory business growth

SME and Agro based industry

Investment

Real time online banking

Increasing awareness for Islamic banking

Business expansion opportunities

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SME financing

Fund raising through new financial products

Capital market operation

Scope of product diversification

Threats

Increased competition

Market pressure for increasing the SLR

Overall liquidity crisis in money market

Commercial banks portfolio

Expansion to lease financing

Increasing local and foreign cost of fund

New entrants into the market

Findings

Through current ratios we understand the current position of the company. It is a comparison between current liabilities and current assets.

In 2006, current assets were 1.10 times more than the current liabilities.

Where as, in 2007, the ratio increased by 0.23 to 1.33.

This means the company succeeded in decreasing its current liabilities and increasing its current assets.

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Conclusion & Recommendation

First, I express my deep gratitude to Almighty Allah for enabling the Bank to achieve tremendous progress in all aspects of the operations in the year 2007. I am grateful to our valued shareholders and customers, who have trusted us with their business. Without their continuous support we could not have achieved this success. I also take this opportunity of expressing my heart –felt appreciation and gratitude to the Government of the People’s Republic of Bangladesh and Bangladesh Bank, for their help and assistance, valuable guidance and advice extended to the Bank from time to time. Finally, I also put on record my appreciation and thank to the employees at all levels for their sincere and dedicated services to the Bank.

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Reference

[1] Hossain Mehmood, Vice Chairman of City Bank Ltd.

[2] Rubel Aziz, Director of City Bank Ltd.

[3] Tabassum Kaiser, Director of City Bank LTD.

[4] K Mahmood Sattar, Managing Director & CEO.

[5]WWW.thecitybank.com

[6]WWW.Google.Com

[7]WWW.Wiki.Com

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