Foreign Exchange Activities of EXIM Bank: Performance Analysis & Impact of Exchange Rate Fluctuations on Export, Import & Remittance

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“Foreign Exchange Activities of EXIM Bank: Performance Analysis & Impact of Exchange Rate Fluctuations on Export, Import & Remittance”

EXIM Bank Limited was established in 1999 under the leadership of Late Mr. Shahjahan Kabir, founder chairman who had a long dream of floating a commercial bank which would contribute to the socio-economic development of our country. He had a long experience as a good banker. A group of highly qualified and successful entrepreneurs joined their hands with the founder chairman to materialize his dream. In deed, all of them proved themselves in their respective business as most successful star with their endeavor, intelligence, hard working and talent entrepreneurship. Among them, Mr. Nazrul Islam Mazumder became the honorable chairman after the demise of the honorable founder chairman. This bank starts functioning from 3rd August, 1999 with Mr. Alamgir Kabir, FCA as the advisor and Mr. Mohammad Lakiotullah as the Managing Director. Both of them have long experience in the financial sector of our country. By their pragmatic decision and management directives in the operational activities, this bank has earned a secured and distinctive position in the banking industry in terms of performance, growth and excellent management. The authorized capital and paid up capital of the bank are Tk. 1000.00 million and Tk. 313.87 million respectively.

From August 03, 1999 to August 31, 2004 Export Import Bank of Bangladesh Limited (EXIM Bank) provides their services on the way of conventional banking system. But as per approval of Bangladesh Bank, Export Import Bank of Bangladesh Limited (EXIM Bank) converted into Islamic Banking system from conventional system of banking with effect from July 1, 2004.

The Bank offers full range of Personal, Corporate, International Trade, Foreign Exchange, Lease Finance and Capital Market Services. EXIM Bank Limited is the preferred choice in banking for its friendly and personalized services, cutting edge technology, tailored solutions for business needs, global reach in trade and commerce and high yield on investments, assuring Excellence in Banking Services.

EXIM Bank Limited at the Life cycle of banking industry.

Logo of EXIM Bank

Tag line of EXIM Bank

EXIM Bank at a glance

Name of the Institution Export Import Bank of Bangladesh Limited
Date of incorporation June 02,1999
Commencement of operation August 03.1999
Authorized Capital Tk. 10000.00 million (December 31st 2009)
Paid up Capital Tk. 225 million (initial)Tk. 3373.96 million (as on 31 December, 2009)
Converted to Islamic bank July 01,2004
Legal form “A Sbariah based Islamic Bank”
Slogan “Together Towards Tomorrow”
Industry Banking industry of Bangladesh
Nature of business Shariah based Islamic banking with different financial services/products
Target customers Individuals and Corporate customers
Deposits, accumulated (2009) Tk. 7383.55 core
General Investments (2009) Tk. 6860.99 core
Investments (shares & bonds) Tk. 216.94 core
Foreign Exchange Business (2009) Tk. 16260.46crore
Operating profit (2009) Tk. 190.82 core
Net profit (2009) Tk. 169.41 core
Number of branch (2009) 59
Total manpower 1800+
Chairman Md. Nazrul Islam Mazumder
Managing director Mohammad Lakiotullah
Web address


The gist of EXIM bank vision is ‘Together Towards Tomorrow’. Export Import Bank of Bangladesh Limbed believes in togetherness with its customers, in its march or the road to growth and progress with services. To achieve the desired goal, there will be pursuit of excellence at all stages with a climate of continuous improvement, because, in EXIM Bank, they believe, the line of excellence is never ending. Bank’s strategic plans and networking will strengthen its competitive edge over others in rapidly changing competitive environments. Their personalized qualities services to the customers with the trend of constant improvement will be cornerstone achieve their operational success.


The bank has checked out the following corporate objectives in order to ensure smooth achievement of its goals-

To became a trusted repository of customers’ money and their financial advisor.

To maintain Corporate and business ethics.

To display team spirit and professionalism.

To provide high quality financial services in export and import trade.

To be the most caring and customer friendly and service oriented bank.

To ensure sustainable growth and establish full value of the honorable shareholders and

Above all, to add effective contribution to the national economy


To receive, borrow or raise money through deposits, loan or otherwise and to give guarantees and indemnities in respect of all debts and contracts

To establish welfare oriented banking systems

To play a vital role in human development and employment generation to invest money in such manner as may vary from time to time

To carry on business of buying and selling currency, gold and other valuable assets


To be one EXIM by holding and guiding the following values:

To strive for private and sound growth.

To work as a team to serve the best interests of the organization.

To work for continues business innovation and improvements.

Organizational Structure and Organ gram of EXIM Bank

The Organ gram of EXIM Bank Ltd

Products and Services of EXIM Bank Ltd.

The bank serves all types of modern, progressive and dynamic business as well as banking services to the customers of all strata of the society. During the short span of time, the bank has been highly recognized and praised by the business community, from small entrepreneurs to large traders and industrial conglomerates and emerged as the fastest growing among the third generation banks in respect of business and profitability.

Export Import Bank of Bangladesh Limited successfully marketed its products designed to fulfill the needs of various socio-economic strata. Attractive features of the products have given a distinctive image among the private banks. The bank has been making continuous endeavor to offer new products and services. As a commercial bank, they provide all traditional banking services:

General Banking Department

Investment Department

Foreign Exchange Department

Different departments of EXIM Bank Ltd

Deposit Products

Mudaraba Monthly Saving Scheme

Mudaraba Multiplus Savings Scheme

Mudaraba Super Savings Scheme

Mudaraba Hajj Scheme

Credit Card

Foreign Currency Deposit Account

Mudaraba Monthly Income Scheme:

It is a monthly income scheme that really makes good sense as well as a sure investment of steady return. Under this Scheme, customer has to deposit a fixed amount of money for 03 (three) years and in return he will receive benefits on monthly basis. Benefits start right from the first month of opening an account under the Scheme and will continue up to 03 (three) years when the depositor will get refund of his deposit. This scheme is a sure investment for a steady return.

Mudaraba Monthly Saving Scheme:

The prime objective of this Scheme is to encourage people to build up a habit of savings. In this scheme one can save a fixed amount of money every month and receive substantial lump sum of money after five, eight, ten or twelve years.

Mudaraba Multiplus Savings Scheme:

Under this scheme, depositor’s money will be almost tripled in 10 (ten) years period. Any individual, Company, Educational Institution, Government Organization, NGO, Trust, Society etc. may invest their savings under this scheme.

Mudaraba Super Savings Scheme:

It helps to build up capital. Super Saving Scheme offers a small depositor to invest his fund (minimum 10,000/-) and the fund will be almost double in 6 (Six) years period. This scheme will secure the future of the investment with ease.

Mudaraba Hajj Scheme:

In order to smooth arrangement of fund for performing Hajj, the bank has introduced this scheme for 5, 8, 10, 15 & 20 year’s period.

Credit Card:

The Bank has launched Master Card among its customers in joint collaboration with Prime Bank Ltd.

Foreign Currency Deposit Account:

This account provides the customer with safe and lucrative way of saving their foreign currency. All non-resident Bangladeshi are most welcome to save and remit their wages and earnings from abroad through this account.

Investment Products:

Corporate Finance

Commercial Finance

Industrial Finance

Project Finance

Lease Finance

Syndicate Finance

Hire Purchase Finance

Real Estate Finance

Foreign Exchange Department of EXIM Bank

Foreign exchange is an important department of EXIM Bank Limited, which deals with import, export and foreign remittances. Foreign Exchange is an International Department of the Bank. It facilitates international trade through its various modes of services. It bridges between importers and exporters. This department mainly deals in foreign currency, that’s why it is called Foreign Exchange department.

This department is playing an important role in enhancing export earning, which aids economic growth and in turn it helps for the economic development. On the other hand, it also helps to meet those goods and service, which are most demandable and not adequate in our country.

Functions of Foreign Exchange Department

Chart: Function of Foreign Exchange Department

The bank, which is authorized by Bangladesh Bank for dealing foreign exchange business on transaction under the FER Act, 1947 is called Authorized Dealership. NCCBL, Kawran Brazar Branch is one of the Authorized Dealership Branch of NCCBL.

In EXIM Bank limited foreign exchange is divided in to three parts according to the major activities:

Import oriented foreign exchange activities.

Export oriented foreign exchange activities.

Foreign Remittance Operation.

Import Section:

The function of this section is mainly to deal with various components such as:

Letter of Credit (L/C)

Payment against Document (PAD)

Payment against Trust Receipt (PATR)

Loan against Imported Merchandise (LIM)

There are a number of formalities, which on Importer has to fulfill before import goods. These formalities are explained bellow:

Import Registration Certificate (IRC)

The first thing one need to carry on a business of import is called Import Registration Certificate. But registration is not required for import goods, which do not involved remittance of foreign exchange like medicine; reading materials etc. can be imported without registration by the users within monetary limit. Documents to be required for Import Registration Certificate are as follows:

Income Registration Certificate

Nationality Certificate

Certificate from Chambers of Commerce and Industry Registered Trade


Bank Solvency Certificate

Copy of Trade License

Requisite fees

On receiving application, the respective CCI&E, officer will scrutinize the documents and conduct physical verification and issue demand note to the prospective importers to furnish the following papers through their nominated Bank-

  • Original copy of treasury deposited as IRC fees
  • Assets Certificate
  • Rent receipt
  • Affidavit from 1st class Magistrate

· Two passport size photograph

  • Partnership deed in case of partnership firms
  • Certificate of Registration, Memorandum and Articles of Association in case of Limited Company.

After scrutinizing and verifying, the nominated Bank will forward the same to the respective CCI&E office with forwarding schedule in duplicate through Banks representative. CCI&E then issue Import Registration Certificate to the Applicant.

Import Procedures:

The procedures, which follows at the time of Import are as, follow:

The buyer and the seller conclude a sale contract provided for payment by documentary credit.

The buyer instructs his Bank (the issuing Bank) to issue a credit in favor of the seller / Exporter / Beneficiary.

The Issuing Bank then send message to another Bank (Advising Bank/Confirming Bank) usually situated in the country of seller, advice or confirms the Credit Issue.

The Advising / confirming Bank then informs the seller through his Bank that the Credit has been issued.

As soon as the seller receives the credit, if the credits satisfy him the he can reply that, he can meet its terms and conditions, he is in position to load the goods and dispatch them.

The seller then sends the documents evidencing the shipment to the „! Bank where the Credit is available (nominated Bank). This can be the A issuing Bank or Confirming Bank; Bank named in the Credit as the paying, accepting and Negotiating Bank.

The Bank then checks the documents against the credit. If the documents meet the requirements of the credit, the Bank then pay, accept or negotiate according to the terms of credit. In the case of credit available by negotiation, Issuing Bank will negotiate with recourse. The Bank, if other then the issuing bank, sends the documents to the issuing Bank.

The issuing Bank checks the document and if they found that the document has meet the credit requirements, they realize to the buyer upon payment of the amount due or other terms agreed between him and the issuing Bank.

The buyer sends transport documents to the carrier who will then proceed to deliver the goods.

Payment Procedure of the Import Documents:

This is the most sensitive task of the import department. The officials have to be very much careful while making payment. The task constitute the followings-

Date of payment- Usually payment is made within seven days after the documents have been received. If the payment is become differed, the negotiating bank may claim interest for making delay.

Preparing sale memo- a sale memo is made at B.C rate to the customer. As the TT & O.D rate is paid to the ID, the difference between these two rates is exchange trading. Finally an inter branch exchange trading credit advice is sent to ID.

Requisition for foreign currency- for arranging necessary fund for payment a requisition is sent to the ID.

Transmission of telex- a telex is transmitted to the correspondent bank ensuring the payment is being made.

Loan against Imported Merchandise (LIM):

If the importer does not come to negotiate the shipping documents from the issuing bank then it creates LIM through the bank clears the goods from the port and holds the goods in its warehouse beside the above as soon as the imported goods come to the port the party may fall into financial crisis and request the bank to clear the goods from the port making payment to the exporter, in this case the party later may take the goods partly or fully from the banks by making required payment (if he/she takes the goods time to time payment will be adjusted simultaneously).

Export Section:

By the term Export, we mean that carrying of anything from one country to another. On the other hand Banker’s define Export as sending of visible things outside the country for dale. Export Trade plays a vital role in the development process of an Economy. With the Export earning, we meet our Import Bills.

The export trade of the country is regulated by the Import and Export (Control) Act, 1950. There are some formalities, which an exporter has to fulfill before and after shipment of goods. No exporter is allowed to export any commodity from Bangladesh unless he/she is registered with Chief Controller of Export & Import (CCI&E) and holds valid Export Registration Certificate (ERC). The ERC is required to be renewed every year and this task is generally done by the bank. As per instruction by Bangladesh Bank, the bank has to report respective department of Bangladesh bank by mentioning latest payment.

Export Registration Certificate (ERC):

Similar to any other business, exporters are required to obtain ERC from the offices of the Chief Controller of Import and Export (CCI&E). No person is allowed to export any goods from Bangladesh without obtaining such ERC. For Registration, prospective Exporters required to submit the following documents:

Application Form,

Fees paid treasury Challan,

Asset certificate

Income Tax Clearance

Valid Trade License

Nationality Certificate

Bank’s Solvency Certificate

Registered Partnership Deed

Memorandum & Articles of Association and Incorporation Certificate

Copy of rent receipt of the business firm

On receipt of the above documents to the office of CCI&E, the applicant is required to deposit required registration fee to the treasury office and receipted Challan should be sent to CCI&E office for enabling there to issue ERC. Every year registered exporters are to make payment of prescribed fee towards renewal of ERC.

Function of Export Section:

Foreign Exchange Regulation (HER) Act- 1947 prohibit export of any goods directly or indirectly to any place outside Bangladesh unless the exporter furnish a declaration to the effect that the export value of goods has been or will be repatriated into the country within a period time specified by the Bangladesh Bank. So, repatriation of export proceeds is mandatory for all exported good or services. Accordingly, before shipment of goods an exporter must declare on Export form (Exp) prescribed by Bangladesh Bank and issued by the Authorized Dealer (Exporters Bunk). The EXP forms are numbered serially and issued in quadruplicate. For delay in repatriation of export proceeds or non-realization of export proceeds, the exporters render themselves for action under Foreign Exchange Regulation Act 1947. Authorized Dealers (AD) and their officials who certify the export forms also render themselves of such action by the Central bank.

L/C Terms:

Each and every clause in the L/C must be complied with meticulously and ensure the following:

Documents are not stale

Documents are negotiated within the L/C validity. If credit expires on a recognized bank holiday its life is automatically valid onto the next working day. This is to be stipulated on the documentary schedule.

Documents value does not exceed the L/C value.


Draft is to be examined as under

Draft must be dated

It must be made out in the name of the beneficiary bank to be endorsed to the order of the bank

Bank must verify the signature of the drawer 4- Amount must be tallied with the invoice amount

It must be marked as drawn under L/C No, date, issued by, bank.


It is to be scrutinized to ensure the followings —

Invoice is addressed to the importer

Full description of merchandise as per L/C

Price, quantity, quality must be as per L/C terms

Must be language in the language of L/C

No other charges are permissible in the invoice beyond the stipulation on the L/C

The amount of draft and invoice must be same and within the L/C value

Required number of invoice must be submitted

Shipping mark and number of packing list must be identical

Invoice value must not be less than the value of declared in EXP form.

Must be correct on the basis of price, quantity as appear L/C

Export Procedure:

A person eager to export should make application to obtain ERC from CCI&E office. Then the person should take step for export purpose into the bank for obtaining EXP form. He must submit following documents:

Trade license

Export Registration Certificate (ERC)

Certificate from concerned Government Organization

After satisfaction on the documents the banker will issue EXP form to the exporter. Now exporter will be getting shipping and other documents from the shipment procedure. Exporter should submit all these documents along with letter of indemnity to his bank for negotiation.

Discrepancy and Industry:

After the shipment of goods, the exporter submits export documents to authorized dealer for negotiation of the same. Here authorized dealer is exporter’s bank. The banker is to ascertain that documents are strictly as per the terms of L/C before negotiation of the export bill; the banker should scrutinize and examine each and every document with great care & must be go through the original L/C in the time of scrutiny. Any kind of lacking can be classified as major or minor. There may be some discrepancies which are removable. If the discrepancies are minor, the export bill against submission of indemnity. Documents with discrepancy should be negotiated.


At the time of negotiation the checklist or required documents are as follows –

Commercial Invoice 8 copies (4 original)

Custom Invoice of Importer’s Country

Packing List 8 copies (4 original)

Original Certificate of Origin

Inspection Certificate by the Agent of Importer

Acknowledgement Letter

Frightful Letter etc.

All the documents are found strictly as per terms and conditions of L/C i.e. if the documents are free from discrepancies or if the discrepancies are covered by Indemnity of the party, bank has to negotiate the Export Bill for negotiation of cash export bills, the O.D buying rate prevailing on the date of negotiation is applied conversion of the foreign currency into Bangladesh currency. All transactions are reported through F.E.T sent daily to the international division Head Office, Dhaka. On receipt of the F.E.T the head office credits the FBNA Account by debit the balance with foreign Banks abroad Account after the process of the bill is realized. After negotiation of the export bills, the documents are to be sent abroad (normally to the L/C Issuing Bank) as per the instructions of L/C & claim reimbursement of the proceeds from the bank as mentioned in the L/C.

Risk in Negotiation:

If the Bank failed to indemnify any discrepancy in documents prepared by the Exporter and if bank paid the demanded amount, bank will face huge loss. At that time, the Negotiating Bank personally try to contact with party and if they agree to deliver the required documents then the bank may get rid out from huge loss otherwise not. So, Banker-Customer relationship is very important in this regard. Bank need to be very careful at the time of negotiation.

Banks Profit through Negotiation:

A question can arise that if the risks involved there, why banks will go for negotiation. Because –

At first, through negotiation bank will earn a certain commission from the party without involving any fund.

Bank will earn US$ from reimbursing bank from the foreign and bank is also earning commission from that.

If the payment make overdue, on that time branch of the concerned bank will earn interest from that amount.

Procedure for collection of Export Bill:

There are two types of procedures regarding collection of Export Bill:

Foreign Documentary Bill for Collection (FDBC)

Foreign Documentary Bill for Purchase (FDBP)

Foreign Documentary Bill for Collection (FPBC):

Exporter can collect the bill through negotiating bank on the basis of collection. Exporter in this case, will submit all the documents to the negotiating bank for collection of bill from importer. The exporter will get money only when the issuing bank gives payment. In this connection bank will scrutinize all the documents as per terms and conditions mentioned in L/C.

Foreign Documentary Bill for Purchase (FDBP):

When exporter sale all the export documents to the negotiating bank is known as Foreign Documentary Bill Purchase (FDBP). In this case, the exporter will submit all the documents to the bank. The bank gives 60-80% amount to the exporter against total L/C value.

Local Document Bill for Purchase (LDBP):

Incoming of L/C customer come with the L/C to negotiate

Documents given with L/C.

Scrutinizing documents as per L/C terms and conditions.

Forward the documents to L/C opening bank.

L/C issuing bank give acceptance and forward acceptance letter.

Payment given to the party by collection basis or by purchasing documents.

Secure Over-Draft (SOD) Export:

Secured Overdraft is one kind of credit facility enjoying by the exporter from the export section. It is generally given to meet the back-to-back L/C claim. Sometimes it is given to the exporter by force for meet the back-to-back L/C claim due to delay of Master L/C payment.

Packing Credit (PC):

It is one kind of credit sanctioned by the export department to meet the exported goods shipment timely. Packing credit is granted to pay salary, wage& other related factory expenses of processing the imported products. The bank will give the facility after deduction of back-to-back.

Foreign Remittance:

Fund transfer from one country to another country goes through a process which is known as remitting process. Suppose a local bank has 200 domestic branches and has the corresponding relationship with a foreign bank say-“X”, maintaining “Nostro Account” in US$ with the bank. Bangladeshi expatriates are sending foreign remittance to their local beneficiary, through that account. Now, when the Bangladeshi expatriates through other banks of different countries remit the fund to their Nostro Account” with “X”, then the local bank’s Head office international division will receive telex message and the remittance section will record the advice and generate the advice letter to the respective branch of the bank. The branch will first decode the test, verify signature and check the account number and name of the beneficiary. After full satisfaction, the branch transfers the amount to the account of the beneficiary and intimates the beneficiary accordingly. But sometimes complexity arises, if the respective local bank has no branch where the beneficiary maintains his account. Then the local bank has to take help of a third bank who has branch there.

Chart: Flowchart of Remitting Process

Export Import Bank of Bangladesh Limited (EXIM) Bank is the Authorized Dealer (AD) to deal in foreign exchange business, as an authorized dealer, bank must provide some services to the clients regarding foreign exchange and this department provides the service of remitting foreign currencies from one country to another country. In the process of providing this remittance service it sells and buys foreign currency, the conversation of one currency into another takes place at an agreed rate of exchange , which than Banker quote one for buying and another for selling.

Foreign Currency Remitting Procedures:

There are two types of remittance:

1. Inward Remittance:

Inward remittance covers purchase of foreign currency in the form of foreign Telegraphic Transfer (T.T), Demand Draft (DD) and Bills & Travelers Cheque, Export Bill etc. sent from abroad favoring a beneficiary in Bangladesh, purchase of foreign exchange is to be reported to Exchange Control Departmentof Bangladesh Bank on from – letter of Credit (L/C). Basically, these are the formal channels of receiving inward remittance. A local bank also receives indenting commission of local firm also comes under purview of inward remittance.

Chart: Model of Inward Remittance

2. Outward Remittance:

Outward remittance covers sales of foreign Currency by Authorized Dealer (AD) or Formal Channel through issuing foreign Telegraphic Transfer (T.T), Demand Drafts (D.D), Traveler’s Cheque etc. as well as sell of foreign exchange under L/C and against Import Bills retired. The Authorized Dealers have to demonstrate utmost caution to ensure that foreign currencies remitted or released by them are used only for the purposes for which they are released. Most outward remittance is approved by the authorized dealer on behalf of Bangladesh Bank.

Chart: Model of outward Remittance

Income of the Bank in Foreign Exchange Sector:

Commissionon opening a BTB L/C which is determined on the basis of “Bills for Collection” selling rate.

0.45% commission on the deferred L/C for 120 days & .30% commission on the deferred L/C for 90 days if the applicant bank accepts the bill for payment (ABP) in respect of its applicant.

Tk.500 for shipping guarantee to the customs department of the port if the applicant wants to discharge the imported products before receiving the documents related to export. The bank acts as a guarantor taking all responsibilities related to payments.

7-10% interest rate on packing credit.

Ratio Analysis

Liquidity Ratio:

Year 2006 2007 2008 2009
Current Ratio .79 1.56 6.17 8.48
Quick Ratio .52 1.04 5.12 6.45


Current ratio shows that short term assets are available to service short-term debt. Both current & quick ratio indicates the liquidity position of the organization. From 2006 to 2009 both current & quick ratio are upward trend. In 2006 the current ratio was 0.79 & quick ratio was 0.52 but in 2008 both current & quick had increased much. And in 2009 the current ratio was 8.48 & quick ratio is 6.45. So, it can be said that the liquidity position of the EXIM Bank is well that the previous year. That means the bank has available current asset to service short term debt & to service the customers. The growth of both current and quick ratio is increased. Hope that the liquidity position of the EXIM Bank increased in future.

Profitability Ratio:

Year 2006 2007 2008 2009
Operating Profit Margin 68.46% 67.66% 70.95% 71.35%
Net Profit Margin 46.22% 23.06% 30.90% 37.87%
ROA 3.94% 4.39% 4.45% 4.14%
ROE 29.91% 16.09% 21.98% 25.10%


Profitability ratios measure the profits of the organization relative to sales, asset or equity. It is important to emphasize that profitability ratios describe the organization past profitability. Profitability is measured by Operating Profit Margin, Net Profit Margin, ROE & ROA. From the above graph, from 2006 to 2009 the operating profit margin & net profit margin decreased. In 2006 the operating profit margin was 68.46% and in 2009 it is 71.35%. That means up to 2009 it is increasing .And in 2006 net profit was 46.22% and 37.87%.So, net profit margin decreased into 23.06% in 2007 it again increased in 2008 and 2009. If we compare to the 2006 the net profit margin decreased in 2009 but it increased compare to 2006 and 2007. In spite of increasing operating profit of EXIM Bank (2006-2009), net profit margin decrease because of increasing administrative costs.


From the table and graph, return on asset (ROA) is increased from2006 to 2008 but in 2009 it is decreased than 2008. This indicates that the firm is efficiently uses its asset and gets a good return from it. Return on equity (ROE) is gradually increased from 2006 to 2009. This means that the firm’s net profit margin, total asset turnover and leverage are in good position. High ROE indicates better profitability and efficiency in the firm that generates good return for shareholder and the ROA & ROE of EXIM Bank is increasing.

Market Ratio:

Year 2006 2007 2008 2009
EPS 43.48 34.76 40.95 50.21
P/E Ratio 7.74 9.02 7.85 7.52


The Earning per share (EPS) was increased from 2006 to 2009 because the share holder’s equity of the EXIM Bank increased. So, it can be also said that the capital market position of the EXIM is well & it share price will be increased. And for this reason investors must fell interested to invest in this bank. P/E Ratio of the bank fluctuated. It increased in 2007 from 7.74 to 9.02 but again it decreased 7.52 in 2009.

Leverage Ratio:

Year 2006 2007 2008 2009
Debt/Equity Ratio 12.43 11.74 11.85 12.72
Debt/Total Asset Ratio 0.925 0.921 0.922 0.93


Leverage ratios indicate to what extent the firm has financed its investment by borrowing. These ratios focus on firm’s financial structure. In the above graph there are two ratios: Debt/Equity ratio and Debt/Total Asset Ratio. In 2006 Debt-equity ratio was 12.43 it decreased in 2007 from 12.43 to 11.74 that means bank uses less debt than equity. But it again increased 11.85 in 2008 and 12.72 in 2009 that means it used more debt to format its capital structure. Debt to total Asset ratio was 0.925 in2006 it also decreased from 0.925 to 0.921 again it increased in 2008 and 2007.So. it can be said that the capital structure of EXIM bank in well but not satisfactory compare to in the year of 2007.

SWOT Analysis of EXIM Bank Ltd.


EXIM Bank Ltd. has already established a favorable reputation in the banking sector. The bank has already shown a tremendous growth in the profit and deposit sector.

The bank uses fast PC Bank Software and T24 software along with online banking system.

EXIM Bank has its own SWIFT code which is very supportive in foreign exchange operations.

The bank provides an interactive corporate culture. Strong employee bonding and belongingness is present among the employees of the bank. The employees of EXIM bank have a strong sense of commitment towards organization and also feel proud and a sense of belonging towards EXIM bank. The strong culture of EXIM bank is one of its major strengths.

The human resource of EXIM bank is extremely well organized and perfectly managed. As from the very first, the top management believed in empowered employees, where they refused to put their finger in every part of the pie. This empowered environment makes EXIM bank a better place for the employees. The employees are not suffocated with authority but are able to grow as the organization matures.


The main problem is that the bank has no clear and specific mission and strategic plan.

The service quality is poor compare to many well known banks in the country.

EXIM bank currently don’t have any strong marketing activities through mass media e.g. Television. TV ads play a vital role in awareness building.

The bank falls far behind when the innovative and new schemes are considered. It has not been involved in the tug of war between the competitors to the accounts and strengthens the existing customer base. This stands out to be the major incompetence and weakness of the bank.


The ultimate goal of EXIM Bank should be to expand its operations to whole Bangladesh and outside of Bangladesh or in other words strong network building. Nurturing this type of vision and mission and to act as required, will not only increase EXIM bank profitability but also will secure its existence in the long run.

Credit Cards are one of the most popular and emerging products in Bangladesh, which offers customers total financial mobility. Various other banks and institutions are currently offering this product. EXIM bank has introduced its own international Islamic Visa card. In future they have the opportunity to introduce other cards and facility.

The world today has become a global village because of advancement in the technologies, especially in communication sector. More emphasis is now given to avail the modern technologies to better the performances. EXIM Bank can utilize the electronic banking opportunity to ensure on line banking 24 hours a day. This would give a competitive edge over others.

Because of the need for micro financing in the market, there are lot of opportunities in this regard. Other banks have already initiated, now the time has arrived when the EXIM Bank must realize it and take on step to cater an ongoing demand.


The upcoming private local and multinational banks posses a serious threat to the existing banking networks of EXIM bank. It is expected that in the next few years more commercial banks will emerge. If that happens the intensity of competition will rise further and banks will have to develop strategies to compete against and win the battle of banks.
EXIM bank has obtained moderate level of customer satisfaction in case of service strategies and the overall service quality which needs to be improved to win the customer satisfaction undoubtedly.

There exists no regular and specific system or department to deal with the customer complaints. Now a day a need for total customer satisfaction is emerging and in their demanding consequences customer’s complaints are ignored

The Project Part

The project part is consists of 2 parts:

  1. The Impact of Exchange Rate Fluctuation on Export, Import and Remittance of EXIM Bank Ltd of both Rajuk Avenue Branch & the overall EXIM Bank.
  2. The Performance Analysis of EXIM Bank’s Foreign Exchange Activities.

The Impact of Exchange Rate Fluctuation on Export, Import and Remittance

Exchange rate plays a very important role on the foreign exchange activities of any country as well as of any institution. The objective of my study is to find out that whether the fluctuation of exchange rate here it is fluctuation of USD had any impact on the volume of Export, Import & Inward Remittance of EXIM Bank.

Total EXIM Bank

Hypothesis Testing: (Remittance)

H?: Fluctuation of exchange rate influence/affects Remittance

H?: Fluctuation of exchange rate don’t influence/affects Remittance

Pairwise Granger Causality Tests
Date: 05/21/11 Time: 14:10
Sample: 2008M01 2010M12
Lags: 6
Null Hypothesis: Obs F-Statistic Probability
REMITTANCE does not Granger Cause EXCH_RATE 29 0.25166 0.95148
EXCH_RATE does not Granger Cause REMITTANCE 0.34111 0.90487

We don’t get a statistically significant result to draw upon the conclusion that whether fluctuations of exchange rate influence/affects Remittance

Regression Analysis & Interpretation:

Here, Remittance is dependent variable & Exchange Rate is independent variable:

Variables Entered/Removed
Model Variables Entered Variables Removed Method
1 exchange . Enter
a. All requested variables entered.
b. Dependent Variable: remittance
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .461a .212 .189 1132.75777
a. Predictors: (Constant), exchange
Model Sum of Squares df Mean Square F Sig.
1 Regression 1.176E7 1 1.176E7 9.169 .005a
Residual 4.363E7 34 1283140.157
Total 5.539E7 35
a. Predictors: (Constant), exchange
b. Dependent Variable: remittance
Model Unstandardized Coefficients Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) -92087.605 31055.455 -2.965 .005
exchange 1370.659 452.665 .461 3.028 .005
a. Dependent Variable: remittance


The B1(Exchange rate)Value of 1370.659 means that for 1 unit change in exchange rate, the average remittance increases by 1370.659. R2=.212 means that 21.2% of the total variation of remittance is explained by the regression line which is not significant at 1% level but at 5% level. The relatively poor R2 value explains the fact that more independent variables should be added in this model to achieve a better adjusted R2 with proper action against the multicolinearity problem.


exchange remittance
exchange Pearson Correlation 1 .461**
Sig. (2-tailed) .005
N 36 36
remittance Pearson Correlation .461** 1
Sig. (2-tailed) .005
N 36 36
**. Correlation is significant at the 0.01 level (2-tailed).

Exchange rate and export value are moderately correlated evident by the Pearson correlation value of 0.461 which is significant at 5% level of significance.

Hypothesis Testing: (Export)

H?: Fluctuation of exchange rate influence/affects Export Value

H?: Fluctuation of exchange rate don’t influence/affects Export Value

Pairwise Granger Causality Tests
Date: 05/21/11 Time: 13:58
Sample: 2008M01 2010M12
Lags: 6
Null Hypothesis: Obs F-Statistic Probability
EXPORT does not Granger Cause EXCH_RATE 29 1.92241 0.13870
EXCH_RATE does not Granger Cause EXPORT 1.29997 0.31244

We don’t get a statistically significant result to draw upon the conclusion that whether fluctuations of exchange rate influence/affects Export Value.

Regression Analysis & Interpretation:

Here, Export is dependent variable & Exchange Rate is independent variable:

Variables Entered/Removed
Model Variables Entered Variables Removed Method
1 exchange . Enter
a. All requested variables entered.
b. Dependent Variable: export
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .685a .469 .453 8550.0055
a. Predictors: (Constant), exchange
Model Sum of Squares df Mean Square F Sig.
1 Regression 2.192E9 1 2.192E9 29.985 .000a
Residual 2.485E9 34 7.310E7
Total 4.677E9 35
a. Predictors: (Constant), exchange
b. Dependent Variable: export_v
Model Unstandardized Coefficients Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) -1214623.145 234405.198 -5.182 .000
exchange 18709.418 3416.692 .685 5.476 .000
a. Dependent Variable: exportInterpretation:

The B1(Exchange rate)Value of 18709.41 means that for 1 unit change in exchange rate, the average export increases by 18709.418. R2=.469 means that 46.9% of the total variation of export is explained by the regression line which is significant at 1% level of significance.


exchange export
exchange Pearson Correlation 1 .685**
Sig. (2-tailed) .000
N 36 36
export_v Pearson Correlation .685** 1
Sig. (2-tailed)