Chapter:
One

Introduction

A bank serves the
main purpose of acting as a payment system, and as a financial intermediary. The
banking system helps the flow of capital from those who have excess of it to those who
need it. The depositors at the banks keep their excess money and the banks use
these funds to finance various organizations, individuals and other who need money. A bank has a
very important social role to play. The careful maintenance of the deposits kept at a
bank is a matter of trustworthiness for the bankers. This is why the banking sector is
always under supervision. The investments that a bank makes with the help of deposits
have to be economically sound, because the default on that advance would make it
difficult for the bank to return the deposit amount to the depositor. The monitoring authority,
in our country, Bangladesh Bank, keeps a constant vigil to make sure that these
depositors get their money back.

All banks try to
promote their deposit and loan products in the market. The vision of every bank
is to be the most efficient bank in terms of customer service, profitability
and technology application. The mission is continuous improvement in business
policies and procedures, cost reduction through integration of technology at
all level. The efforts on delivery service in all areas of banking activities
with the aim to add increased value to shareholders investments and offer
highest possible benefits to the customers.

We try to present an
overview of NCC Bank Limited and its financial products, a comparative analysis
of NCC Bank Limited Consumer Credit Schemes with other commercial banks and
some suggestion for the improvement of NCC Bank Limited throughout the report.

The required data
about the interview procedure are collected from face to face conversation with
the manager and employee of NCC Bank Limited.

The report will be more interesting if the
time duration increased. But we have tried my best to full fill the report. Another
important factor is that data are not structurally distributed in the
organization for that reason we have to depend on the secondary data like the Annual report,
different product brochure. Due to secrecy point of view it was not possible to collect all the core information/data
from the office. Though it is a competitive market, the company was quite
liberal in disclosing the confidential information
to me for my report but it was expected to me to keep the confidential things at my discretion and as at the same time, render
as much information in the report as required.

Objectives of the report

The
main objectives of the report are: –

To study existing banker-customer relationship particularly
the efficacy of customer services of the bank.

Shown the profitable sector in which the bank achieved
high return after investing.

Identified the weak sector in which the bank has some
bad experience in past.

Methodology of
the Study:

Methodology of the study:

 The report was
fully exploratory in nature. Data have been collected from both primary &
secondary sources.

Primary Sources

Ø  Direct observation.

Ø  Information discussion with professionals.

Ø  Secondary
Sources

Ø  Annual report (2009) of NCC Bank Ltd.

Ø  Banks record.

Ø  Websites and News papers are was major sources.

Ø  Some of my course element as related to this report.

Limitation of the Project:

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

ü  The main constraint of the study is inadequate access
to information, which has hampered the scope of analysis required for the
study.

ü  Every organization has their own
secrecy that is not revealed to others. While collecting data i.e. interviewing
the employees, they did not disclose much information for the sake of the
confidentiality of the organization.

ü  Since the bank personals were very busy, they could provide me very little time.

ü  Another problem is that creates a lot of confusions
regarding verification of data. In some cases more than one person were
interviewed to clarify each concept as many of the bankers failed to provide
clear-cut idea about the job they perform.

ü  We carried out such a study for the first time, so
inexperience is one of the main constraints of the study.

Chapter: Two

An overview of Bangladesh’s Banking
Environment

The
banking in Bangladesh has passed three decades through different policy
environment and comprises central bank at the apex, nationalization commercial
banks, private commercial banks, foreign commercial banks and specialized
financial institutions.

Before
liberation of Bangladesh in 1971, the total banking system was private owned,
urban based and profit oriented. But after liberation, the government of
Bangladesh nationalized all the banks operating in Bangladesh in 1972, except a
few foreign bank branches.

Currently
the major financial institutions under the banking systems include:

·
Bangladesh Bank

·
Commercial Banks

·
Islamic Banks
(For interest free Islamic banking in adherence to the Islamic principles &
practice)

·
·
Merchant
Banks

Generally
the commercial banks and finance companies provide a myriad of banking products
/facilities and services to the needs of their customers. These include 24
hours banking, (Tele banking via modems and phones) and general banking and
service products. For customers’ convenience, such products are available
throughout the bank branches in our country.

However
the Bangladesh banking industry is characterized by the tight banking rules and
regulations set by Bangladesh Bank. All banks and financial institutions are
highly governed and controlled under the banking companies act 1993, which lays
out many restrictions, besides other guidelines. Among the many regulations
imposed, Bangladesh Bank does not allow any FI to into bankruptcy or insolvency.

In
addition as banking products which can be offered in our country, are fairly
homogeneous in nature due to the tight regulation imposed by Bangladesh Bank.
Competing through differentiating the range of products offered is often
difficult and not effective. Moreover any innovative banking service launched
is quickly duplicated by 7 other banks such as ATMs, Tele banking, online (real
time) computerization bank branches etc. Hence the key to establish a
competitive edge in banking industry of Bangladesh is to provide better
customer service quality.

1^st
Generation Banks (Established 1982-1988)

2^nd
Generation Bank (Established 1992-1996)

Eastern Bank Limited, National Credit and Commerce
Bank Limited, Prime Bank Limited, Southeast Bank Ltd, Dhaka Bank Ltd., Al
Arafah Islami Bank ltd., Social Investment Bank Ltd., Standard Chartered Bank
and Dutch-Bangla Bank Ltd.

3^rd
Generation Bank (Establish 1996-2003)

HSBC Bank, Mercantile Bank Ltd., Standard Bank Ltd,
One Bank Ltd, EXIM Bank ltd, Premier Bank Ltd, Mutual Trust Bank Ltd, First
Security Bank Ltd, Bank Asia Ltd and the Trust Bank Ltd.

An overview of NCC Bank Limited

Introduction:

NCC
Bank Limited is a new generation bank. It is a scheduled bank under private
sector established under ambit of Bank Company Act, 1991 and incorporated as
Public Limited company act, 1994 on 17^th May 1993.Prior to
conversion into a scheduled commercial bank; National Credit Limited (NCL) was
incorporated as public limited investment company in Bangladesh on 18^th
November 1985. It made its journey with a modest beginning on 25^th
November 1985 at its registered office and first branch at 7-8 Motijheel
Commercial Area, Dhaka-1000. The initial Authorized Capital of the company was
30 (Thirty) crore consisting of 30 (Thirty) lac. Ordinary share of Tk. 100/-
each. A new opportunity in this field of financial activities was opened for
the business. NCL made a careful journey and maintained its successive growth
for few years with its qualified professional management under most
unpredictable, unregulated, uncertainties and limitations.

The emergence of NCC Bank Limited at the Juncture of
liberalization of global economic activities, after the URUGUAY round has been
an important event in the financial sector of Bangladesh. The experience of the
prosperous force and the strategic operational policy option of the bank. The
company philosophy, “A Bank with vision” has been precisely the essence of the
legend of Bank’s success.

Glance of
the Bank

National
Credit and Commerce Bank Limited is one of the second generation domestic
private banks in Bangladesh after the war of the independence. It is a
scheduled Bank under private sector established under the ambit of Bank Company
Act, 1991 and incorporated as Public Limited Company Act, 1994 on 17^th
May 1993. Prior to conversion into a scheduled commercial bank. National Credit
Limited (NCL) was incorporated as public limited Investment Company in
Bangladesh on 18^th November 1985. It made its journey with a modest
beginning on 25^th November 1985 at its registered office and first
branch at 7-8 Motijheel Commercial Area, Dhaka-1000. The initial Authorized
Capital of the company was Taka 30 (Thirty) Crore consisting of 30 (Thirty) Lac ordinary Shares of Tk.
100.00 each. A new opportunity in the field of financial activities was opened
for the business. NCL made a careful journey and maintained its successive
growth for few years with its qualified professional management under most
unpredictable, uncertainties and limitations.

Having
started its operations as a commercial bank in 1993 recovering from some
primary difficulties. National Credit and Commerce Band Limited has now emerged
as a major player in the financial sector. Listed in both the Dhaka and
Chittagong bourses since 1999 with an IPO that the paid-up capital of the bank
to Tk.39 crore.

Banks
are the pillars of the financial system. Specially, in Bangladesh the health of
the banking system is very vital because the capital market is little developed
here. As the banks are still the major sources of credit and exercise great
influence on the financial system, it is extremely important that the country’s
banking systems should be in good health in the interest of investment
activities meeting the needs of all kinds of finance and related matters.

NCC
Bank- At Present

Like
clothes shops, candy shops, bake shops, food shops, NCCBL is not a “debt shop”
the term being used by many to call the present say banks. It is now been
called a modern bank that undertakes all its operation at international
standard.

Having
standard its operation as a commercial bank in 1993, recording from some
primary difficulties, NCC bank has now emerged as a major player in the
financial sector. Listed in both Dhaka and Chittagong bourses since late 1999
with an IPO that raised the paid-up capital of the bank to Tk. 39 crore.

Banks
are the pillars of the financial system. Specially, in Bangladesh, the health
of the banking system is very vital because the capital market is little
developed here. As the banks are still the major sources of credit and exercise
great influence on the financial system, it is extremely important that the
country’s banking systems should be in good health in the interest of
investment activities, meeting the needs of all kinds of finance and related
matters.

Over
the years, NCC bank has built itself as one of the pillars of Bangladesh’s
financial sector and is playing a pivotal role in the extending the role of the
private sector of the economy. The bank has a strong branch network nation wide
with 67 branches.

Mission of NCC bank

We
shall be the forefront of national economic development by:

q  Anticipating business solutions required by all our
customers everywhere and innovative supplying them beyond expectation.

q  Setting industry benchmarks of world class standard
delivering customer value through our comprehensive product range, customer
service and all our activities building an exciting team-based working
environment that will attract, develop and retain employees of exceptional
ability who help celebrate the success of our business, of our customer and of
national development.

q  Maintaining the highest ethical standards and a
community responsibility worthy of a leading corporate citizen.

q  Continuously improving productivity and profitability,
and thereby enhancing shareholder value.

To be in the front of
national development by providing all the customers inspirational strength,
dependable support and the most comprehensive range of business solution
through our team of professional that work passionately to be outstanding in
everything we do.

Goal
of the Bank

To
share a significant portion of the banking sector’s by utilizing available
manpower and also state of the art technology for maximizing the shareholders
wealth.

i.
Long Term Goal

To maximize the wealth of the shareholders.

ii.
Short Term Goal

To earn satisfactory rate of return on investment by
providing wide range of banking service.

Board of Directors

At present there are 26
members in the Board of Director. Out of 26 members 23 of them are the sponsor
of the shareholder and 3 of them are publicly nominated as the equity
participants from capital market have included them.

However
the members are obliged to maintain the annul general meeting and declare the
dividend payout schedule on due time. Moreover, the committee selected by
shareholders represents individual body that then looks after the periodic
issue with the management and tries to solve the problem.

Organization Structure of NCCBL

Hierarchy of NCCBL

The
Classification of Posts

Management Executive

Ø  Deputy Managing Director.

Ø  Senior Executive Vice President.

Ø  Executive Vice President.

Ø  Senior Vice President.

Ø  Vice President.

Ø  Senior Assistant Vice President.

Ø  Assistant Vice President.

Banking Staff

Ø  Senior Principal Officer.

Ø  Principal Officer.

Ø  Executive Officer.

Ø  Management Trainee.

Ø  Probationary Officer.

Ø  Officer

Ø  Junior Officer.

Ø  Assistant Officer.

Ø  Trainee Assistant Officer.

Non Banking Staff

Computer Staff

Ø  Officer.

Ø  Junior Officer.

Ø  Assistant Officer.

Ø  Computer – Trainee.

Cash Staff

Ø  Head Cashier.

Ø  Officer.

Ø  Junior Officer.

Ø  Cashier- Trainee.

Sub- Ordinate Staff:

Ø  Messenger.

Ø  Bank Guard.

Branches of the
NCCBL

Features
of NCCBL

Bank
is an intermediary institute. Like other commercial bank NCCBL also has some
special features. They are as follows:

1. Legal Entity: It is
   compulsory matter for a bank to achieve legal entity. The stronger legal
   entity leads to effective banking program. NCCBL has a strong legal
   entity.
2. Organizational
   Structure: NCCBL has a well-set organizational structure. Organizational
   structure is a precondition of effective banking activities.
3. Financial Solvency:
   Though NCCBL is a new bank, its ratio of liquidity is well and strong. So,
   the clients get greater confidence in the bank.
4. Location of The Bank:
   Location is very useful for bank. The Head Office and the branches of
   NCCBL are located in the central point of the capital and the other
   district towns.
5. Security: the NCCBL is
   totally a secured bank. The clients of the bank get a heavy security on
   their deposit.
6. Management of the
   Bank: The executives and the officers of NCCBL are very experienced.
   Maximum executives are ex-government bank officers.
7. Foreign Exchange:
   NCCBL operates foreign exchange business promptly. There 13 branch deals
   with foreign exchange.

Nature
of the business

NCC
bank is a progressive commercial bank in privet sector in Bangladesh. It
creates a new opportunities for its clients. It gives customized service and
harmonious banker-client relationship. It contributes towards formation of
national capital, growth of saving and investment in trade, commerce and
industrial sectors. It provides different types of commercial banking and
services to the customer of all stratum in the society with in the stipulation
laid down in the Bank Company Act 1991. Rules and regulations framed by the
Bangladesh bank from time to time.

Business
Operation

National
Commerce and Credit Bank Limited emerged as bank in the country on 17^th
May 1993 out of a great turbulent situation encounter by set while National
Credit Limited. However the institution survived the ordeals and come out as a
full-fledged commercial bank. The company raised its Authorized Capital to Tk.
750 million as per guidelines set out by the Bangladesh Bank. The paid up
capital was fixed at Tk. 480.48 million as against Tk. 429.00 million.

Trade
Finance and Correspondent Banks

Successful companies today
are fully aware that they need to be able to rely on the services of a bank
that can handle international trade with a good hand. Ever since its conversion
into a full –fledged bank in 1993, NCC bank has been an accomplished “Trade
Finance” bank. With a highly professional team experienced and competent
professionals we are able to provide a wide range of services to companies
engaged in international trade.

NCC
Bank has also positioned itself as an established correspondent bank. Through a
worldwide network of 260 correspondent banks NCC Bank is present in all key
areas of the globe. Our ambit of correspondent includes top ranking
international banks with a global reach.

Number
& name of the Branches of NCCBL

NCCBL
has 67 (Sixty seven) branches all over in Bangladesh. The name of the branch,
their addresses are given in the appendix-1.

Performance
of the Bank

The
bank may sustain its strong image in the mind of the customers and shareholders
as a leading financial institution despite serious competition from both local
and foreign banks operating in the country. Sill they are increasing their
profit. Its opening profit was Tk. 624.94 million in 2007, which were Tk.
597.57 million in previous year. But whole performance of the bank is not
looking well.

Authorize
Capital

The
authorize capital of the bank remain unchanged at Tk. 750 million in the year
2008.

Paid-up
Capital

The
bank raises its paid-up capital from Tk. 480.48 million to Tk. 552.55 million
for 2008 to 2009. With the increase of paid-up capital to Tk. 552.55 million,
the capital based of the bank has become strong.

Reserve Fund and Other Reserves

The reserve fund of the
bank increased of Tk. 336.12 million in the year 2008 as against Tk. 336.12
million of previous year, increase being 24.85%.

Corporate Mission

• To provide high quality financial services in
  export and import trade.
• To provide excellent quality Customer service.
• To maintain Corporate and business ethics.
• To become a trusted repository of customers’
  money and their financial advisor.
• To make our stock superior and rewarding to the
  customers/share holders. 
• To have a Sound Capital Base.

Corporate Culture

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

SWOT Analysis

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

Strengths:

 — NCC BANK Limited has already established
a favorable reputation in the banking industry of the country. It is one of the
leading private sector commercial banks in Bangladesh. The bank has already
shown a tremendous growth in the profits and deposits sector.

 — NCC BANK Limited has already achieved a high growth
rate accompanied by an impressive profit growth rate in 2001. The number of
deposits and the loans and advances are also increasing rapidly.

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

Weaknesses:

— Not proper utilization of the banking
system.

 __ The
poor service quality has become a major problem for the bank. The quality of
the service at NCC BANK is higher than the Dhaka Bank or Dutch Bangla Bank etc.
But the bank has to compete with the Multinational Bank located here.

Opportunities:

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

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

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

—   A large number of private
banks coming into the market in the recent time. In this competitive
environment NCC BANK must expand its product line to enhance its sustainable
competitive advantage. In that product line, they can introduce the ATM to
compete with the local and the foreign bank.

Threats:

—
All sustaining multinational banks and upcoming foreign and private banks
pose significant threats to NCC BANK Limited. If that happens the intensity of
competition will rise further and banks will have to develop strategies to
compete against these local and foreign
banks.

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

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

Management of NCC BANK

For
any financial and non-financial organization, Management is the most valuable
and important resources of any kind of organization. And, a well-organize
management provides the organization to reach its ultimate goal. Management
means planning, organizing, staffing, directing and controlling of all
financial and non-financial resources of an organization. Different aspects of
management practice in NCC BANK planning, organizing, staffing, directing &
controlling, human resources practices and
recruitment finally.

Chapter: Three

GENERAL BANKING

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

Since
bank is confined to provide the services everyday, general banking is also
known as ‘retail banking’. In NCC BANK LTD Main Branch, the following
departments are under general banking section:

A) Account
opening section

B) Remittance
section

C) Clearing
section

D) Accounts
section

A) ACCOUNT OPENING SECTION

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

1. Current
Deposit.

2. Savings account.

3. Short notice deposit (SND)

?Types of
Accounts with Terms and Conditions

Current Deposit

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

Some Important Points are as follows :

v  v  There is no withdrawal limit.

v  v  Minimum Tk.1000 balance must always maintain all the
time;

Savings Bank
Account

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

v  v  Minimum Tk.1000 balance must always maintain all the
time;

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

v  If withdrawal amount exceed 1/4^th of the
total balance at a time no interest is given upon the deposited money for that
month.

SND (Short Notice Deposit) Account

Normally various big companies,
organizations, Government Departments keep money in STD account. Frequent
withdrawal is discouraged and requires prior notice.  The deposit should be kept for at least seven
days to get interest. The interest offered for STD is less than that of savings
deposit. Interest is calculated based on daily minimum product and paid two
times in a year. Interest rate is 6.00%.

Table-01

?
Account Opening procedure

?Documents
required for opening account

• Introduction of
  the account.
• Two photographs of the
  signatories duly attested by the introducer.
• Identity (copy of
  passport).
• Joint Declaration Form
  (For joint a/c only).
• Employee’s Certificate
  (in case of service holder).

• Introduction of the
  account.
• Two photographs of the
  signatories duly attested by the introducer.
• Partnership letter
  duly signed by all partners (Sign should be similar as stated in
  Partnership Deed).
• Partnership Deed duly
  certified by Notary public.
• Registration (If any).
• Updated Trade license.

?
Proprietorship account

Introduction of the account.

2. Two photographs of the signatories duly
   attested by the introducer.
3. Valid copy of Trade
   License.
4. Rubber stamp.
5. TIN number
   certificate.
6. Identity (Copy of
   passport).
7. Permission letter from
   DC/ Magistrate (in case of newspaper)

? Limited company

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

? Club / societies account

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

?Closing
of an account

The
closing of an account may happen,

q  If the customer is desirous to close the account,

q  If the NCC BANK finds that the account is inoperative
for a long duration.

q  If the court of NCC BANK issues garnishee order.

A
customer may close his/her account any time by submitting an application to the
branch. The customer should be asked to draw the final check for the amount
standing to the credit of his/her account less the amount of closing an other
incidental charge and surrender the unused check leaves. The account should be
debited for the account closing charge etc. and the authorized officer of the
bank should destroy unused check. In case of joint account the application for
closing the account should be signed by the joint account holder. The fee for
closing of an account is Tk.50.

B) LOCAL REMITTANCE

In
these purpose the three officer of this bank to help me. They are Mr. Humaun
Kabir, Ms. Syeda Taslima Begum and Special thanks Ms. Syeda Shammi Akter. 

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

Types
of remittance:

Ø  Between banks and non banks customer

Ø  Between banks in the same country

Ø  Between banks in the different centers.

Ø  Between banks and central bank in the same country

Ø  Between central bank of different customers.

The main instruments used by
the NCC BANK of remittance of funds are

Ø  Payment order (PO)

Ø  Demand Draft (DD)

Ø  Telegraphic Transfer (TT)

So the basic three types of
local remittances are discussed below:

Table- 02

2.Confirm with sent
advice

3.Check the ‘Test Code’

4.Make paymentCharge Only commissionCommission + telex charge

• Test – key
  Arrangement 

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

• Commission for PO

NCC
BANK charges different amount of commission on the basis of Payment order
amount. The bank charges for pay order are given in the following chart:

Table-
03

Term Deposit Receipt

The
Local Remittance section of NCC BANK Motijheel Branch also issues TDR. They are
also known as time deposit or time liabilities. These are deposits, which are
made with the bank for a fixed period, specified in advance. The bank need not
maintain cash reserves against these deposits and therefore, the bank offers
higher of interest on such deposits.

• Opening of TDR
  Account:  The depositor has to fill
  an account form where in the mentions the amount of deposit, the period
  for which deposit is to be made and name/names is which the TDR term
  deposit is to be issued. In case of a Joint name NCC BANK also takes the
  instructions regarding payment of money on maturity of the deposit. The
  banker also takes specimen signatures of the depositors. A TDR term
  deposit account is then issued to the depositor acknowledging receipt of
  the sum of money mentioned there. It also contains the rate of interest
  and the date on which the deposit will fall due for payment.
• Term Deposits: These
  rates are not negotiable. In this table we can find out the percentage
  that is given by the bank for specific period of time to the customer.

Table
– 04

Term
Deposits

• Payment of interest:
  It is usually paid on maturity of the fixed deposit. NCC BANK calculates
  interest at each maturity date and provision is made on that
  “miscellaneous creditor expenditure payable accounts” is debited for the
  accrued interest.
• Encashment of FDR: In
  case of premature FDR< NCC BANK is not bound to accept surrender of the
  deposit before its maturity date. In order to deter such a tendency the
  interest on such a fixed deposit is made cut a certain percentage less the
  agreed rate. Normally savings bank deposit is allowed.

• Renewal of FDR: In NCC
  BANK, the instrument is automatically renewed within seven days after the
  date of its maturity if the customer does not come to encash the FDR. The
  period for renewal is determined as the previous one.

C)
CLEARING SECTION

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

• Normally, Bangladesh
  Bank performs the Clearing House in Dhaka, Chittagong, Rajshahi, Khulna
  & Bogra. Where there is no branch of Bangladesh Bank, Sonali bank
  arranges this function.
• Member of Clearing
  House:  NCC BANK limited is a
  scheduled Bank. According to the Article 37(2) of Bangladesh Bank Order,
  1972, the banks which are the member of the clearinghouse are called as
  Scheduled Banks. The scheduled banks clear the cheque drawn upon one
  another through the clearinghouse.

Types of Clearing

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

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

• Types of clearing
  house:  There are two type of
  clearing house: Those are

1)
Normal clearing house:

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

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

2)
Same day clearing house:

1^st house: 1^st house normally
stands at 11:00 am to 12:00 pm

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

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

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

2) Amount
in The cheque & deposit slip must be same in words & in figure

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

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

5) Cheque must be signed.

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

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

9) Depositor’s signature in the deposit
slip.

Return
house:  Return House means 2^nd
house where the representatives of the Bank meet after 3 p.m. to receive and
deliver dishonored chouse which placed in the 1^st Clearing House.

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

Insufficient fund.

Amount in figure and word differs.

Cheque out of date/ post- dated.

Payment stopped by the drawer.

…Payee’s endorsement irregular / illegible / required.

Drawer’s signature differs / required.

Crossed cheque to be presented through a bank.

Other specific reasons not mentioned above.

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

If the cheque is dishonored due to insufficiency of
funds then NCC BANK charges TK.25 as penalty.

Responsibility
of the concerned officer for the Clearing Cheque

Crossing of the cheque.

(Computer) posting of the cheque.

Separation of cheque from deposit slip.

Sorting of cheque 1st bank wise and then on branch
wise.

Preparation of 1^st Clearing House computer
validation sheet.

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

·

 Types of Bills for Collection

i.
Outward
Bills for Collection (OBC).

Inward
Bills for Collection (IBC).

What
is OBC?

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

OBC with different branches of other banks

OBC with different branches of the same bank

Procedure
of OBC:

Entry in the OBC register.

Put OBC number in the cheque.

Despatch the OBC cheque with forwarding.

Reserve the photocopy of the cheque, carbon copy of
the forwarding and deposit slip of the cheque in the OBC file.

Table-
05

Commission
for bills collection:

Inward bills for collection (IBC)

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

Procedure
of IBC:

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

Again
place in the clearing house or send the OBC cheque with Return Memo to the
issuing branch according to their information.

D) ACCOUNTS SECTION

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

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

Workings of this
department:

• Packing of the correct
  vouchers according to the debit voucher and the credit voucher
• Recording the
  transactions in general and subsidiary ledger
• Preparing the daily
  position of the branch comprising of deposit and cash
• Preparing the daily
  Statement of Affairs showing all the assets and liability of the branch as
  per General Ledger and Subsidiary Ledger separately
• Making payment of all
  the expenses of the branch
• Recording inters
  branch fund transfer and providing accounting treatment in this regard.
• Preparing the monthly
  salary statements for the employees
• Preparing the weekly
  position for the branch which is sent to the Head Office to maintain Cash
  Reserve Requirement (C.R.R)
• Preparing the monthly
  position for the branch which is sent to the Head Office to maintain
  Statutory Liquidity Requirement (S.L.R)
• Make charges for
  different types of duties
• Preparing the budget
  for the branch by fixing the target regarding profit and deposit so as to
  take necessary steps to generate and mobilize deposit.
• Checking of
  Transaction List
• Recording of the
  vouchers in the Voucher Register

Chapter: Four

Findings

When we were working
at NCC Bank Motijheel, Main Branch, we have attained to a never kind of
experience. By analyzing the various data the following finding have been
found:

General
Banking activities are related with progression of operation. NCC’S operations
are increasing gradually. Each year deposits growth indicates NCC`S better
movement in the banking field which is satisfying clients. As a result, clients
are increasing and ultimately equity is increasing. In 2009 Bank’s reserve
capital was Tk.871.77 (Million) compared with Tk.598.39 (Million) in 2007.
Gradually bank’s operations are increasing. Investment is increasing rapidly
and a good response is getting from the clients in different investment scheme.
NCC`S increasing movement is generating increasing profits. NCC is gaining huge
profits by satisfying clients. Client’s satisfaction depends on the efficacy of
customer service. All operational improvement with profit leads us to say that
–efficacy of customer service of NCC BANK is in the positive situation.

Recommendations

As per earnest observation
some suggestions for the improvements of the situation are given below:

q
Bank should offer
more facilities to the customers such as credit card visa card ATM machine etc.

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

q
Now a day’s world
is going very fast. Now most of the banks open online customer service system.
So in order to compete in the world marketing they should adopt online banking
system in every branch.    

q
In General Banking department it is
necessary to implement modern banking process instead of traditional system. It
should be more computerized.

W

CONCLUSIONS

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

Success in the banking
business largely depends on effective various accounts. The more income will be
from reserve fund. And also the more income from Credit operations the more
will be the profit of the NCC BANK Limited.

Though there are some
drawbacks in implementing Credit General banking in NCC BANK Limited as per
manual, it can be further developed in light of the recommendations being
discussed above. Finally it can be argued that though the results achieved so
far are not satisfactory, General banking is much more important part for
enhancing NCC Bank’s strength and there lies the opportunities to make it more
effective in the future for our own benefit.

BIBLIOGRAPHY

Prospectus
of NCC BANK (June 1^st , 2010)

Annual
Report of NCC BANK (2006)

Annual
Report of NCC BANK (2007)

Annual
Report of NCC BANK (2008)

Annual
Report of NCC BANK (2009)

Total
Quality Management (Third Edition)

Dale H.
Besterfield

Strategic
Management (Fourth Edition)

Charles
W.L. Hill & Gareth R. Jones