Overview Of National Bank

  1. Traditional Heritage and Historical Background of National Bank Limited
 National Bank Limited has its prosperous past, glorious present, prospective future and under processing projects and activities. Established as the first private sector Bank fully owned by Bangladeshi entrepreneurs, NBL has been flourishing as the largest private sector Bank with the passage of time after facing many stress and strain. The member of the board of directors is creative businessman and leading industrialist of the country. To keep pace with time and in harmony with national and international economic activities and for rendering all modern services, NBL, as a financial institution automated all its branches with computer network in accordance with the competitive commercial demand of time. Moreover, considering its forth-coming future the infrastructure of the Bank has been rearranging. The expectation of all class businessman, entrepreneurs and general public is much more to NBL. Keeping the target in mind NBL has taken preparation to open new branches in 2008.
The then President of the People's Republic of Bangladesh Justice Ahsanuddin Chowdhury inaugurated the bank formally on March 28, 1983 but the first branch at 48, Dilkusha Commercial Area, Dhaka started commercial operation on March 23, 1983. The second Branch was opened on 11th May 1983 at Khatungonj, Chittagong.
At present, NBL has been carrying on business through its 92 branches spread all over the country. Besides, the Bank has drawing arrangement with 415 correspondents in 75 countries of the world as well as with 32 overseas Exchange Companies. NBL was the first domestic bank to establish agency arrangement with the world famous Western Union in order to facilitate quick and safe remittance of the valuable foreign exchanges earned by the expatriate Bangladeshi nationals. NBL was also the first among domestic banks to introduce international Master Card in Bangladesh. In the meantime, NBL has also introduced the Visa Card and Power Card. The Bank has in its use the latest information technology services of SWIFT and REUTERS. NBL has been continuing its small credit program for disbursement of collateral free agricultural loans among the poor farmers of Barendra area in Rajshahi district for improving their lot. Alongside banking activities, NBL is actively involved in sports and games as well as in various Socio-Cultural activities. Up to September 2006, the total number of workforce of NBL stood at 2239, which include 1689 officers and executives and 550 staff. Since the very beginning, the Bank exerted much emphasis on overseas operation and handled a sizeable quantum of homebound foreign remittance. The Bank established extensive drawing arrangement network with Banks and Exchange Companies located in important countries of the world. Expatriate Bangladeshi wage earners residing in those countries can now easily remit their hard-earned money to the country with confidence, safety and speed.
The year 2006 marked the addition of yet another golden stair in the chronicle of NBL’s success story. Compared to 2005, Foreign exchange business of the Bank increased by 34.40% to Tk.5186 crore, of which export, import and remittance business increased by 34.16%, 31.27% and 56.50% respectively. Total assets of the Bank stood at Tk.4483 crore on 30.09.2006. The Bank invested 25% equity in Gulf Overseas Exchange Company LLC, a joint venture Exchange Company in Oman, operating since November, 1985 under the management of our Bank. The Bank received Riyal Omani 11875 equivalent to Tk.2.10 million as dividend for the year 2006.
Now NBL is on line to establish trade and communication with the Prime International banking companies of the world. As a result NBL will be able to build a strong root in international banking horizon. Bank has been drawing arrangement with well conversant money transfer service agency "Western Union". It has a full time arrangement for speedy transfer of money all over the world. Banking is not only a profit-oriented commercial institution but it has a public base and social commitment. Admitting this true NBL is going on with its diversified banking activities. NBL introduced National Bank Monthly Savings Scheme (NMS), Special Deposit Scheme, Consumer's Credit Scheme and NBL Housing Loan, NBL Small Business Loan, Small House Loan Scheme, Festival Small Business loan etc. to combine the people of lower and middle-income group.
Transparency and accountability of a financial institution is reflected in its Annual Report containing its Balance Sheet and Profit & Loss Account. In recognition of this, NBL was awarded Crest in 1999 and 2000, and Certificate of Appreciation in 2001 by the Institute of Chartered Accountants of Bangladesh.
A team of highly qualified and experienced professionals headed by the Managing Director of the Bank who has vast banking experience operates bank and at the top there is an efficient Board of Directors for making policies.
1.2       Vision of National Bank Limited
Establishing them as a top grade efficient Bank through best application of modern information technology in business activities, offering high standard clientele services and proper coordination of foreign trade business is the core of their vision.
1.3       Mission of National Bank Limited 
With a view to achieving commercial objectives of the Bank, their sincere and all out efforts stay put unabated. Respected clients and shareholders are attracted to us for our transparency, accountability, social commitments and high quality of clientele services.
1.4       Objectives of NBL
  • Bringing modern Banking facilities to the doorstep of general public through diversification of Banking services, thereby arousing saving propensity among the people.
  • Foreign a cordial, deep-rooted and firm banker-customer relationship by dispensing prompt and improved clientele services.
  • Taking part in the development of the national economy through productive deployment of the Bank’s resources as well as patronizing different social activities.
  • Connecting clients to modern banking practices by the best application of improved information technology, so that they get encouraged to continue and feel proud of banking with NBL.
  • Ensuring highest use of the professional workforce through enhancement of their aptitude and competency.
  • Responding to the need of the time by participating in syndicated large loan financing with like-minded Bank’s of the country, thereby expanding the area of investment of the Bank.
  • Elevating the image of the Bank at home and abroad by sustained expansion of its activities.
Business Goal
To patronize, sponsor and encourage games and sports, entertainment and other socio-economic activities, alongside providing the best services to the clients.
Growth and Development of NBL
The NBL carries out all traditional functions, which a commercial Bank performs such as mobilization of the deposit, investment of funds, financing export and import business, trade and commerce and industry. The Bank earned profit TK.275.07 million in the year 1997 and TK.400.64 million in the year 2001. However, profit decreased in the year 1999 TK.197.55 million than the year TK.1382.48 million in the year 2004. The Bank deposits of TK.15553.87 million in the year 1997 and TK.36896.64 million in the year 2004.total advance made by the Bank was TK.15055.90 million and TK.20223.64 million at the end of the year 1997 and 2004 respectively. Foreign Exchange business handles by the Bank; import business was TK.18082.40 million in the year 1997 and TK.19264.50 million in the year 2003 and TK.18964.45 million in the year 2004. Export business is increasing continuously that is TK. 12651.80 million in the year 1997, TK. 21869.00million in the year 2003, TK.23071.00million in the year 2004.TK1778.87millon in the year 2008,TK 8916.76millon in the year2009,TK1750.00 in the year 2010
Management Hierarchy of National Bank
                BOARD OF DIRECTORS.
                  MANAGING DIRECTOR.
                    VICE PRESIDENT.
                PRINCIPLE OFFICER.
Branches of NBL
NBL started its journey through its first branch at 48, Dilkusha C/A, Dhaka on march23, 1983, as a major private commercial Bank in Bangladesh. The bank is now at 27 years of age and meanwhile it has established as many as 145 branches throughout the country and made a smooth and comprehensive network in side the country as well as around the globe.
At present area wise Branches of the Bank around the country is presented below:
Region Number of branches
Dhaka Region 53
Chittagong Region 30
Rajshahi Region 11
Khulna Region 08
Sylhet Region 17
Barishal Region 05
Rangpur Region 06
Total 130
SME Branches 15
Total Branches 145
2.3       Division of NBL
  • Name of the divisions of NBL are as follows:
  • Human Resource department.
  • General Banking Division.
  • Audit and Inspection Division.
  • Credit Card Division.
  • Finance and Administration Division.
  • Marketing Division.
  • Credit Division
  • Computer Division
  • Reconciliation Division
  • Dispatch.
  • Accounts division.
  • Remittance.
  • Public Relation.
  • System and Operation.
  • Law and recovery Division.
  • Foreign Exchange Division.
  • Two Special Divisions.
  • Special Audit Division.
  • Tax Department
National Bank Products and Services
3.1       Consumer Credit Scheme
National Bank's Consumer Credit Scheme gives you a great opportunity to buy household and office items on easy installments. This scheme gives you the advantage of part payment to cope with the high price tags of many necessary home and office appliances.
3.2       Special Deposit Scheme
For most of the people on fixed income the opportunity to supplement their monthly earning is a golden one. And NBL Special Deposit Scheme gives a customer just that. Under this scheme, customers can deposit money for a term of 5 years. The deposited money is fully refundable at the expiry of the term. At the same time, during the term period they can enjoy a monthly profit corresponding to their deposited amount. As for instance, under this scheme a deposit of Tk, 55,000/- gives a monthly income of Tk.500/-.
Deposited Amount Monthly Benefit
Tk. 55,000/- Tk. 500/-
Tk. 1,10,000/- Tk. 1,000/-
Tk. 1,65,000/- Tk. 1,500/-
Tk. 2,20,000/- Tk. 2,000/-
3.3       Monthly Savings Scheme
This scheme is specially designed for the benefit of the limited income group members. This helps to accrue small monthly savings into a significant sum at the end of the term. So, after the expiry of the term period the depositor will have a sizeable amount to relish on. A monthly deposit of Tk.500/- or Tk.1000/- or Tk. 2,000/- or Tk. 3,000/- or Tk.4, 000/- or Tk. 5,000/- or Tk. 10,000/- for 3 or 5 or 8 years period.
Monthly Installment Monthly Savings
3 years (9.00%) 5 years (9.25%) 8 years (9.50%)
Tk. 500/- 20,677/- 37,896/- 70,849/-
Tk. 1,000/- 41,255/- 75,791/- 1,41,691/-
Tk. 2,000/- 82,510/- 1,51,583/- 2,83,394/-
Tk. 3,000/- 1,23,765/- 2,27,374/- 4,25,091/-
Tk. 4,000/- 1,65,020/- 3,03,166/- 5,66,788/-
Tk. 5,000/- 2,06,274/- 3,78,957/- 7,08,485/-
Tk. 10,000/- 4,12,549/- 7,57,914/- 14,16,970/-
3.4       Credit Card                                                                       
Through its Credit Card. National Bank Limited has not only initiated a new scheme but also brought a new life style concept in Bangladesh. Now the dangers and the worries of carrying cash money are memories of the past.
Credit Card comes in both local and international forms, giving the client power to buy all over the World. Now enjoy the conveniences and advantages of Credit Card as you step into the new millennium.
3.5       NBL ATM Service
National Bank Limited has introduced ATM service to its Customers. The card will enable to save our valued customers from any kind of predicament in emergency situation and time consuming formalities. NBL ATM Card will give our distinguished Clients the opportunity to withdraw cash at any time, even in holidays, 24 hours a day, and 7 days a week.
Western Union Money Transfer

Money transfer from anywhere in the World to Bangladesh in minutes. Joining with the world's largest money transfer service "Western Union", NBL has introduced Bangladesh to the faster track of money remittance. Now money transfer between Bangladesh and any other part of the globe is safer and faster than ever before. This simple transfer system, being on line eliminates the complex process and makes it easy and convenient for both the sender and the receiver. Through NBL – Western Union Money Transfer Service, your money will reach its destination within a few minutes.
3.7 Saving Insurance Scheme
This is an uncertain World and the threatening silhouettes of future catastrophes are always looming around. This NBL scheme gives your family protection against the insecurities of the world. This scheme is the first of its kind in Bangladesh. It combines the benefits of regular savings and insurance scheme, so, you get the usual rate of interest on the deposited amount while you enjoy the protection of a comprehensive insurance coverage. Under this scheme, the beneficiary (ies) get equal the deposit in case of natural death of the account holder whereas in the event of accidental death of the account holder the beneficiary (ies) will receive twice the deposit. As for example, if a customer picks up Easy Class (Tk.50,000/-) he/she will get Tk.50,000/- for natural death and Tk.1,00,000/- for accidental death apart from his/her deposited amount and interest.

Class Deposit Normal Death Benefit
(Including Own Deposit)
Accidental Death Benefit
(Including Own Deposit)
Easy 50,000/- 1,00,000/- 1,50,000/-
Convenient 1,00,000/- 2,00,000/- 3,00,000/-
Classic 2,00,000/- 4,00,000/- 6,00,000/-
Standard 5,00,000/- 10,00,000/- 15,00,000/-
3.8       Overseas Operations:
Curr Country Bank City Account Number SWIFT
AUD Australia National Australia Bank Ltd. Melbourn 1803072656500 NATAAU33033
CHF Switzerland UBS AG Zurich 02300000087574050000M UBSWCHZH80A
EURO Germany Commerzbank A.G Frankfurt 50040000/400871506201 COBADEFF
Germany American Express Bank, GMBH Frankfurt 018117607 AEIBDEFX
Italy Unicredito Italiano SPA MILANO 995002792  
GBP U.K Lloyds TSB Bank Plc London 01005511 LOYDGB2L
HSBC Bank UK Plc London 39273437 MIDLGB22
JPY Japan The Bank of Tokyo-Mitsubishi Ltd Tokyo 653-0431079 BOTKJPJT
USD U.S.A Bank of America NA New York 6550-7-89556 BOFAUS3N
JP Morgan Chase Bank New York 001-1-041845 Chips UID CH
223691 //CP 0002
// FW021000021
HSBC Bank USA New York 000124630 //CP 0108, FW021001088 MRMDUS33
Standard Chartered Bank New York 3582-074947-001 //CP 0256, FW026002561 SCBLUS33
American Express Bank New York 00703496 //CP 0159 AEIBUS33
Mashreq Bank Psc New York 70119153 MSHQUS33
CAD CANADA Bank of Nova Scotia Toronto 0286613 NOSCCATT
Country Bank City Account Number
BHUTAN Bank of Bhutan Phuentsholling ACU/34-002
INDIA American Express Bank Ltd
State Bank of India
Sonali Bank Arab Bangladesh Bank Ltd
NEPAL Nepal Arab Bank Ltd Kathmandu 0109014050001
MAYANMAR Mayanmar  Foreign trade Bank Yangoon 92907
PAKISTAN HSBC Bank Karachi 001-079839-190
Pakistan United bank Ltd. Karachi 002-068534-200
SRILANKA ANZ Grindlays Bank Colombo 1374666028
List of branches authorized by Bangladesh Bank (Central Bank) to deal in Foreign Exchange and International trade :
Agrabad branch
Bangshal branch
Barishal branch
Bogra branch
Babubazar branch
Chaktai branch
Dilkusha branch
Elephant Road branch
Foreign Exchange branch
Imamganj branch
Islampur Road branch
Jessore branch
Jubilee Road branch
Joypurhat branch
Khulna branch
Khatunganj branch
Kawranbazar branch
Mohakhali branch
Motijheel branch
Malibagh branch
Naogaon branch
Northbrook Hall Road
Narayanganj branch
Pabna branch
Rajshahi branch\
Rangpur branch
Sylhet branch
Satkhira branch
Sk. Mujib Road branch
Financial Performances of National Bank Ltd. at a Glance
4.1   NBL Balance Sheet as on December 31, 2009
National Bank Limited
Balance Sheet as at 31 December 2009
  Note 2008
Cash in hand(including foreign currencies) 3 717,820,399 494,267,896
Balances with Bangladesh Bank and its agent bank(s)(including foreign currencies) 4 2,408,857,773 2,543,297,769
    3,126,678,172 3,037,565,665
Balances with other Banks and Financial Institutions      
In Bangladesh 5 1,174,661,533 1,665,914,742
Outside Bangladesh   243,451,390 296,312,688
    1,418,112,923 1,962,227,430
Money at call and short notice 6 1,210,000,000 760,000,000
Investments 7 5,730,384,026  3,564,820,110
Govemment   1,286,674,335 1,602,387,470
Others   4,443,709,691 1,962,432,640
Loans and advances 8    
Loans, cash credits, overdrafts etc.   29,619,598,166 24,913,193,862
Bills purchases & discounted   3,090,077,784 2,107,011,252
    32,709,675,950 27,020,205,114
Fixed assets including land,building,furniture and fixtures 9 1,627,288,541 1,431,225,822
Other assets 10 973,904,622 624,333,962
Non-banking assets      
TOTAL ASSETS   46,796,044,234 38,400,378,103
Borrowings from other Banks,Financial Institutions and agents 11 678,543,199 585,288,844
Deposits and other accounts: 12    
   Current Deposists and other accounts, etc 12.2 6,178,409,300 5,810,964,486
   Bills payable 12.3 665,728,459 577,536,825
   Savings Bank Deposits   10,023,258,132 8,606,662,845
   Fixed Deposits   15,502,105,700 12,189,464,357
   Term Deposits 12.4 7,965,541,733 3,733,153,583
   Bearer Certificates of Deposits   15,825,000 15,825,000
    40,350,868,324 32,984,053,891
Other liabilities 13 2,492,373,280 2,096,415,400
TOTAL LIABILITIES   43,521,784,803 35,665,758,135
Shareholders Equity/Capital      
Paid up capital 14 805,471,524 619,593,480
Statutory reserve 15 806,240,084 806,240,084
General reserve 16 482,723,327 382,723,327
Other reserve   770,353,375 738,206,260
Profit and loss account-Retained Earning 17 409,471,121 187,856,817
TOTAL SHAREHOLDERS' EQUITY   3,274,259,431 2,734,619,968

  46,796,044,234 38,400,378,103
Containgent Liabilities      
Acceptances and endorsements 18
Letters of Guarantees   3,548,941,816 3,573,017,908
Irrevocable letter of credit   12,513,112,183 10,845,723,706
Bills for collection   3,053,071,910 1,923,767,080
Other liabilities (Bad & Loss)  
    19,115,125,909 16,342,508,694
Other Contingent Liabilities      
Value of Bangladesh Sanchaya Patra on hand   622,629,000 293,372,000
Value of travelers' cheques on hand   9,877,565
    622,629,000 303,249,565
Total Contingent Liabilities   19,737,754,909 16,645,758,259
Other commitments      
Lease rental commitments  
Documentary Credits and short term trade-related transactions  
Forwaaaard assets purchased and forward deposits placed  
Undrawn note issuance and revolving facilities  
Undrawn formal standby facilities,credit lines and other commitments  
Sport and forward foreign exchange rate contracts  
Other exchange contracts  
Claims against the Bank not acknowledged as debt  
Total off Balance Sheet items  

    19,737,754,909 16,645,758,259
These financial statements should be read in conjunction with the annexed notes.
4.2       Profit and loss (income) account
  2006(TAKA) 2007(TAKA) 2008(TAKA) 2009(TAKA)
Interest income
Interest paid on deposits and borrowing etc.
Net interest/investment income
Investment income
Commission, exchange, and brokerage
Other operating income
Total operating income(A)
Salary and allowances
Rent, taxes, insurances, electricity etc.
Legal and professional expenses
Postage, stamp, telecommunication
Auditor’ fee
Stationary, printing, advertisement, etc.
Managing director’s salary and allowance
Director’s fee
Repairs, maintenance & dep. of assets
Charge on loan losses
Other expenses
Total operating expenses(B)
Profit/(loss) before provision(C=A-B)
Provision for loans
    Specific provision
    General provision
Provision for diminution in value of invests
     Other provision
Total provision (D)
Total profit/(loss) before taxes(C-D)
Provision for taxation for the year
Net profit after taxation
Retained earning brought forward from previous year
Amount transferred from share premium acc
Statutory reserve
Proposed cash dividend
Dividend distribution
Bonus share
Share premium account
Retained surplus
Earning per share(EPS)
LAST FIVE YEAR’S PERFORMANCE AT A GLANCE:                           (Taka in Million)
PARTICULARS 2005 2006 2007 2008 2009
Auth Capital. 1000.00 1000.00 1000.00 1000.00 1000.00
Paid-up Capital. 430.27 430.27 430.27 619.59 805.04
Reserve Fund. 1142.48 1198.70 1270.63 1927.17 2059.32
Deposits. 32984.05 40350.87 47961.22 60187.89 76838.64
Advance. 20200.64 21677.96 22257.15 27020.21 32709.67
Investment. 2891.97 3839.60 4044.20 3564.82 5730.38
Import Business. 31648.20 42458.50 62759.00 78226.32 77539.77
Export Business. 21344.10 28019.20 31824.00 36284.44 38398.85
Gross Income. 3288.00 3343.55 3622.31 2406.43 3287.8
Gross Expenditure. 2271.36 2473.23 2677.22 886.08 1312.5
Profit before tax. 400.64 250.32 336.09 1200 333.75
Profit after tax. 274.44 142.19 88.12 568 133.5
Fixed assets. 797.81 878.46 889.61 1431.22 1627.28
Total assets. 48732.10 45719.10 47929.57 38400.37 46796.04
Book value per share 361.74 365.52 378.59 395.31 569.25
Market value per share 212.00 287.28 238.86 226.61  
Earning per share 53.13 63.78 33.98 20.43 40.59
4.3       Profitability ratio
Book value per share 361.74 365.52 378.59 395.31 569.25
Market value per share 212.00 287.28 238.86 226.61  
Earning per share 53.13 63.78 33.98 20.43 40.59
Dividend 30.00% 30.00% 20.00% 20.00% 20.00%
01. Return on investment
We know that return on investment = net profit after tax/ total assets
Return on investment ratio
Trend analysis of return on investment
02. Return on equity
Return on equity ratio
We know that, return on equity = net profit after tax/shareholders equity
For 2002 418144626/1526408121 .27
For 2003 375455447/1781863568 .21
For 2004 611938344/2239801912 .27
For 2005 568196286/2807998198 .20
For 2006 568196286/2734619968 .21
For 2007 133500000/ 3274259431 .04

Trend analysis of return on equity ratio
4.3   Bank Rate:
The Bangladesh Bank reduced the Bank Rate to 5.0% on 06/11/2003. The Bank Rate had remained unchanged at 6.0% during the period from 24/10/2001 to 05/11/2003. The Bank Rate has been reduced with a view of bringing down the overall rate of interest in the Banking sector.
4.4 Capital and Reserve fund:
The authorized and paid-up capital of the Bank remained unchanged at TK.1000.00 million and TK.430.27 million respectively, while the amount of reserve fund increased to TK.1410.63 million in 2003. The value of total equity held by the Bank stood 4.42% higher at TK.1628.97 million in the preceding year.
Bank’s Own share customize:
NBL started its journey in 1983 with a paid-up capital of TK.4.40 corre and 19 owner shareholders. At present, paid-up capital of the Bank has increased to TK.43.03 crore which is casting a impact in improving liquidity situation in the capital market. Till 31 December 2003, the Bank has opened a total of 18490 share portfolio accounts under its share customize system management, of which 9269 shareholders are active. Compared to the baseline scenario, the rate of increase in the number of shareholders has been 48784%, while that of paid-up capital stood at 936%. Under the above management system, we have issued a total of 127744 share certificates, which has been playing a strong role in shar Total Deposit resources of the Bank stood at TK.27762.12 million in 2007 as compared to TK. 26276.26 million in 2006. The rate of growth is 5.65%.
                                                           Book value per share ( In Taka).
4.6   Deposits:
Total Deposit resources of the Bank stood at TK.27762.12 million in 2007 as compared to TK. 26276.26 million in 2006. The rate of growth is 5.65%.  
                                                                                           Taka in million                                              

4.7 Advances:
The total volume of advances extended by the Bank stood at TK.22257.15 million at the end of December 2007, which is TK.579.19 million higher as compared to TK.21677.96 million at the end of 2006. The rate of growth is 2.67%. By adopting a time befitting policy in credit management and applying modern techniques of loan risk analysis, we have been able to bring down the amount of bad loan to a tolerable level. In line with the Government’s industrial policy and in the light of   Bangladesh Bank’s policy guidelines, alongside priority sectors, we have been extended loans from our own resources as well as through syndication with other Banks to different important sectors, such as information technology, textiles, agro-based industries, shrimp culture, house loan scheme, lease finance, housing industry and other traditional and non-traditional industries. We have been operating retail Banking through our Consumer Credit Scheme.
4.8 Import:
The value of Import trade financed by NBL amounted to $32.65 crore (TK1926.45 crore) in 2003 as compared $32.85 crore (TK.1924.57 crore) in the preceding year. Although import financing in Taka terms showed some increase, in Dollar terms it declined by 0.62%. The main reason for this decline was strict adherence to import margin requirements by AD Branches of the Bank
                                                                                 Taka in Million

4.9 Export:
Export financing by NBL in 2007, though much higher than the level in the preceding year, was quite significant in comparison to Bangladesh’s position in total world trade. NBL handled export documents worth $28.23 crore in 2007 as compared to $14.29 crore in 2006. Export financing by this Bank declined mainly due to diversion of exports excepting garment exports from this Bank during the year under report.      
As in previous years, the incidence of merger and liquidation of large number of Banks in different countries of the world continued to occur in 2007 also due to International and other reasons. National Bank continued to pursue a conservative stance as usual in respect of its relations with associate foreign Banks. Notwithstanding, however, the number of our foreign correspondents in 70 countries across the world increased from 358 in the previous year to 369 in 20037.
NBL earned an operating profit of TK.945.09 million and pre-tax profit of TK.336.09 million in 2007 as compared to TK.870.32 million and TK.250.32 million respectively in 2006.Per share income of the Bank declined from TK.33.90 in the preceding year to TK.20.43 in 2007 due to increase in the rate of corporate tax and higher provision for adjustment of previous year’s tax during the year under report. 
Taka in million
The Issuance of Bonus shares at the Ratio of 5:1 on the basis of Annual Accounts for 2003.
4.13 SWIFT:
National Bank Limited began to make full use of the services of SWIFT right from 2002. In 2003, the software of SWIFT has been shifted from SWIFT Alliance Entry to SWIFT Alliance Access and 5 major AD Branches of NBL have been directly connected with the SWIFT network. Up to the end of 2003, we have executed Bilateral Key Exchange (BKE) with 233 Banks across the world, which is increasing continuously.
From the very inception, National Bank Limited has been attaching priority to Foreign Banking activity. We have drawing arrangements with Banks and exchange houses in Switzerland, Malaysia, Singapore and countries are sending their hard-earned money to the country quickly and safely.
As in previous years, we have been able to bring substantial amount of Foreign Exchanges into the country through remittances from abroad in 2003. Reflecting its dexterity and reputation in handling remittances, total amount of Foreign Remittances made through National Bank increased by 18.26% to $131.76 million or TK.7637.50 million from TK.6458.10 million in 2002.
Since 1985, the Gulf Overseas Exchange Company in Oman has been conducting its Business under the Management of this Bank. National Bank Limited owns 25% equity shares of the company. In 2003, the bank earned 5250.00 Oman Riyal equivalents to TK.0.79 million as Dividend from the company. In order to support expansion of Bangladesh’s border trade with Myanmar, NBL has established a Representative office in 1996.    
Taka in million.
                                                                                          Fixed Assets (Taka in million).

Banglabazar Branch at a Glance
Organ gram of Banglabazar Branch


Junior Officer



      Text Box: Foreign Remittance
    Text Box: Import

5.3       Operation of Banglabazar Branch
The operations of Banglabazar Branch are performed under several functional departments. Functions of all Departments are briefly mentioned as follows: —
Accounts and Administration Department Functions of this Department are: —

  • Assess employee requirements: —
  • Job Design.
  • Job Rotation.
  • Report on employee’s performance for increments.
  • Prepare leave plan.
  • Monitor overall banking functions.
  • Preparation of daily statement.
  • Preparation of supplementary statement.
  • Transfer all transaction for adjusting.
  • Maintain and adjust all branches accounts.
  • Preparation of monthly and quarterly statements to head office and          Bangladesh Bank.
  • All dealing with reconciliation report.
5.3.1    Dispatch
The Department is essential for Bank. Because, several kinds of letters or applications are comes first. Then these are receipt from various professions. Two types of letters are held here Inward and Outward letter.
5.3.2    Account Opening and Closing
Opening of different types of Accounts
Issuing check book and delivering Deposit receipt book.
There are several kinds of Account are held:
  • Savings Account: When a person will do this A/C, the important things are necessary.
  • Introduction of Depositor / A/C’s holder.
  • Photocopy of passport/ Chairman Certificate/ Attested of First Class Officer/ Voter ID Card.
  • Two copies of photographs.
  • KYC {Know Your Customer} form.
       Current Individual Account:
  • Requirement same as savings Account.          
  • Current Account for Proprietorship /Firm Account
  • Common Individual of S/A.
  • Trade License with validity.
  • Seal of the Firm.
Current Account for Partnership Account          
    1)     Common Individual of S/A.
    2)     Trade License with validity (more than two owners).
    3)     Partnership Deed with Registered.
    4)     TK.1000 stamp.
    5)     Partnership letter (Bank will gives).
    6)     Firm’s Seal.     
  • Request letter (for Account Opening)
  • Regulation
Current Account for Private (LTD)
  • Common Individual of S/A.
  • Trade license.
  • Memorandum or articles of association.
  • Certificate in Corporation.
  • Regulation of full board with signature.
  • List of Directors.
  • Organizations seal.
  • Certificate of commencement
Club/ Society
  • By Laws.
  • Regulation.
  • Common Individual.
  • Seal of club/society.
  • Registration number.
  • Trustee
  • Common as club/society.
  • Trustee Deed.
5.3.3    Deposit and cash department
Bank performs their activities simultaneously because these two departments are separately engaged to each other of Branch. The main functions carried on by Deposit and cash Departments are as follows:
  • Verifying signature of clients
  • Receipts.
  • Payments.
  • Cash Balancing.
5.3.4    Remittance Department
Remittance means transmission/transfer of money from one place to another, Local remittance represents remittance that takes place within the territory of a country.
Banks have a wide network of Branches all over the country and offer various types of remittance facilities to the public/customer/client etc.
Virtually there are main works of remittance department that are as under: —
  • Transfer of funds through Demand Draft (DD), Telegraphic Transfer (TT), and Mail         Transfer (MT).
  • Issuance of Pay Order (PO), pay slips (PS), Security Deposit (SD), Bearing Certificate Deposit (BCD) etc.
  • Local Bills for Collection (LBC), Outward Bills Collection (OBC).
  • Collections of cheques, Drafts and presenting them to clearing house.
  • Maintenance of FDR.
5.3.5    Foreign Remittance
These activities are needed: —
  • Activities related to L/C opening.
  • Receiving documents from Exporters Bank.
  • Perform all activities for retirement of document for collecting the importing goods.
The main functions of the Exports are:
  • Getting the L/C Documents from Foreign Importers Bank.
  • Gives this L/C to Exporter.
  • Advising the L/C.
  • Opening the Bank-to-Bank L/C.
  • Collection and distribution of the payment of Bank to Bank.
When after shipment of goods the exporter submits all documents as per as L/C, this Department scrutinizes those Documents and sent to the Importers Bank.
5.3.6    Foreign Exchange
The main functions of Foreign Exchange Department are:
  • Deals with inward foreign Remittance.
  • Dealing of Traveler Checks.
  • Transfer money and currency through Western Union.
  • Transfer fund through draft, Telegraphic Transfer, Mail Transfer etc.
  • Foreign Bills collection.
  • Foreign Bills purchase and discount.
10 ID (To Receive Money through Western Union).
  1. Passport (not expired).
  2. Driving License.
  3. Ration Card.
  4. Voters ID,
  5. Pan Card.
  6. Refugee Card.
  7. Student ID (Nationalized University and college).
  8. Bank Passport (NBL).
  9. Army Card.
  10. Post office loyalty card, govt. employee ID card, local (W/C) ID card.
  11. All ID are valid only if they have a photograph and the ID verifies the person’s signature.
Credit Management
6.1       Introduction:
The objective of a bank is to collect deposits from surplus party (who have surplus capital) and utilized these deposits to deficit parties (whose capital is short). Bank is the proper medium of those parties to utilize the capital properly. Bank guild the surplus parties where to invest. Bank collect deposits from surplus parties in return bank give them some percent of benefits which is gained from the different loan or credit given to the deficit parties. Bank takes some percent of benefit by given credit facilities.
Advances by National bank Limited made in different forms, such as, Overdrafts, Cash credits, bills purchased and discounted etc. National Bank Ltd. deals with the money from the depositor which is repayable on demand. So, it cannot afford to lock up it fund for long periods. NBL usually grant short-term advances, which are utilized to meet the working capital requirements of the borrower. Only a small portion of a bank's demand and time liabilities is advanced on long term basis where the banker usually insists on a regular repayment by the borrower in installments.
Credit Management:
To prevent excessive flow of credit and proper use of it, banks required to follow an appropriate credit appraisal procedure to impose financial discipline on borrowers. The procedure that organize, control and motivate the borrowers will called credit management.
6.3 Principles of sound lending:
Although all lending involves some degree of risk, it is necessary for any bank to develop sound and safe lending policies and new lending techniques in order to keep the risk to a minimum. The principles of sound lending may therefore, be summarized on Safety, Liquidity, Purpose, Profitability, Security, diversification of risk and National Interest.
As the bank lends the funds entrusted to it by the depositors, the first and foremost principle of lending is to ensure the safety of funds lent. By safety is meant that the borrower is in a position to repay the loan, along with interest, according to the terms of loan contract. The repayment of the loan depends upon the borrower’s (1) capacity to pay, and (2) willingness to pay. The former depends upon his tangible assets and the success of his business; if he is successful in his efforts, he earns profits and can repay the loan promptly. Otherwise, the loan is recovered out of the sale proceeds of his tangible assets. The willingness to pay depends upon the honesty and character of the borrower. The banker should, therefore, take utmost care in ensuring that the enterprise or business for which a loan is sought is a sound one and the borrower is capable of carrying it out successfully. He should be a person of integrity, good character and reputation.
Liquidity is the availability of bank funds on short notice. It is not enough that the money will come back, it is also necessary that it must come back on demand or in accordance with agreed terms of repayment. The borrower must be in a position to repay within a reasonable time after a demand for repayment is made; otherwise, the liquidity position of the bank is endangered. A sizable portion of bank advances are, therefore, granted to meet the working capital requirement of the borrower rather than to meet the fixed capital requirement, i.e., construction of building or purchase of fixed assets. A banker would be failing in his duty to safeguard the interest of his depositors and shareholders if his credit policy does not provide a method of gradual repayment and final recovery of the money advanced. Thus the banker regards liquidity as important as safety of the fund.
Commercial bank has to distribute its resources in a manner that they meet the twin requirements of liquidity and profitability. A banker has; therefore, to see that major portion of the assets owned by it are not only liquid but also aim at earning a good profit. The working funds of a bank are collected mainly by means of deposits from the public and interest has to be paid on these deposits. They have also to meet their establishment charge and other expenses. They have to make provision for depreciation of their fixed assets and also for any possible bad and doubtful debts. Interest earned by a bank on its advances is the main source of its income. The difference between the interest received on advances and the interest paid on deposits constitutes a major portion of the banker’s income. It is sometimes possible that a particular transaction may not be profitable in itself but there may be some ancillary business and deposits available from borrowers other concerns which should also be taken into consideration.
A banker would not throw away money for any purpose for which the borrower wants. The purpose should be productive so that the money not only remains safe but also provides a definite source of repayment. The banker should study the purpose for which loan is required and the resources from which the borrower is expected to repay. If the funds borrowed are employed for unproductive purposes, the repayment in the normal course will become uncertain.
It is practice of banks not to lend money without any security. The security offered for an advance is insurance or a cushion to fall back upon in case of need. A banker would not normally like to recover the advance from the sale of security. They would prefer an advance to come back from normal source. The importance of an adequate and acceptable security can, however, be hardly over-emphasized. Security serves as a safety valve for an unexpected emergency. An element of risk is always present in every advances however secured it might appear to be. If the securities are not insisted upon, there are chances that the borrower may raise funds elsewhere by charging them to others and thereby the banker’s position is jeopardized. Security taken by banks can be classified into two broad categories, such as, primary security and collateral security.
Primary security:  
Primary security may be either personal security or impersonal security or both. Personal security is given by a borrower by way of duty executed promissory note, acceptance / endorsement on a bill of exchange and personal covenants in mortgage deeds or loan agreements. Impersonal security is given when a charge is created by way of pledge/hypothecation /mortgage over the borrower’s tangible assets, such as, goods and commodity, fixed assets bills receivables, book debts.
Collateral security:
Collateral security may be direct or indirect. Collateral security obtained from the borrower himself to secure his own account is known as direct collateral security. For example, advance against hypothecation of stock-in-trade is strengthened by equitable mortgage of the title deeds of house property of the borrower. Indirect collateral security means any form of security given by a third person to secure a customer’s account. A guarantee given by a third party is an indirect collateral security.
Diversification of Risks:        
This is also a cardinal principle of sound lending. A prudent banker always tries to select the borrower very carefully and takes tangible assets as securities to safeguard his interests, yet some risk is always involved therein. So the banker follows the principle of diversification of risks based on the famous maxim “do not keep all the eggs in one basket”. It means that the banker should not grant advances to few big firms only or to concentrate them in a few industries or in few cities or regions of the country only. The advances, on the other hand, should be over a reasonably wide area, distributed amongst a good number of customers belonging to different trades and industries. The banker thus diversifies the risk involved in lending. If a big customer meets misfortune, or certain trades or industries are affected adversely, the overall position of the bank will not be in jeopardy.
National Interest:      
Banking industry has significant role to play in the economic development of a country. The banker would lend if the purpose of the advance is for overall national development plans necessitating flow of credit to priority sector in the larger national interest. Sometimes the need of the borrower may be considered so essential for the benefit of the national economy despite heavy risks involved the advance may be granted. In the changing concept of banking national interest for financing in some areas specially in advances to agriculture, small industries, small borrowers, and export oriented industries are assuming great importance.
6.4       Steps of Credit Management
Step-1: Corresponding
  1. Application from the party.
  2. Application & declaration for credit facilities from.
  3. Net worth calculation.
  4. Account statement
  5. CIB report
  6. CRG (Credit Risk Guarantee).
  7. Limit proposal and approval from.
  8. Sanction latter.
Step-2: Disbursement
  1. Acceptance of sanction latter.
  2. Charge documents
  3. Security documentation (Original deed, legal option etc.)
Step-3 Monitoring
  1. Record the transactions against credit facilities.
  2. Make performance report on transactions.
  3. Evaluate and monitor the securities period by period.
Procedure of Disbursement of Loans & Advances
To have crystal clear idea about the Credit Management of critical analysis of the following are essential­:
  1. Credit Policy of the Bank.
  2. Credit Sanctioning Authority  and
  3. Processing and screening of Credit Proposal.
6.5.1    Credit Policy
Credit policy contains the views of total macro-economic development of the country as a whole by way of providing financial support to the Trade, Commerce and Industry. Throughout its credit operation goes to every possible corners of the society. They are financing large and medium scale business house and Industry. At the same time they also takes care entrepreneurs through its operation of Lease Finance and some Micro Credit, Small Loan Scheme etc. As a part of its Credit Policy through its Credit operation maintains Commitment for social welfare. The ban is coming up with a scheme where the under privileged children will be given financial support for education and self-employment.
From operational aspects it is observed that as a matter of policy­-
Charging of interest is flexible depending on insisting of the proposal and the customer. It take care in maintaining proper "Mix" of Short, Medium and Long Term finance in its Credit Portfolio usually they do not g for long term Finance for a period not exceeding 5 years.  Put emphasis on the customer i.e. the "Man" and the "Business no on the Security" in selecting borrowers. It takes care of diversity in credit portfolio.
6.5.2    Credit Sanctioning Authority
In order to implements the system of delegation of power effectively and to Derive the desired for the bank as well as the executive; concerned bank has developed a system to ensure that delegated authority' by the executive can be evaluated realistically and qualitatively.
The basic guideline they follow to achieve the objective of delegation of authority is­ the Managing Director can exercise all the powers vested in other executives of the bank. The Managing Director may suspend exercise of delegated power of any executive through specific or general order. Other Than Managing Director, the delegation of powers is exercise by the executive through specific or general order.
6.5.3    Processing and Screening of Credit Proposal:
There are some common regulatory directives governed by Banking Companies Act, Bangladesh Bank and the Law of the State which or to be followed strictly at the time of screening a credit proposal. In addition, credit proposals are appraised critically by NBL Credit officers from various angles to judge the feasibility or viability of the proposal. The customers at the branches of the bank place credit proposals. When a customer comes with a credit proposal, the Credit Department of the Branch makes an open discussion with the customer on different issues of the proposal to judge the worthiness of the proposal and the customer. If the proposal seems to be worthwhile in all respects then the proposal is placed before the credit committee of the bank. After threadbare discussion, if the committee agrees in principle the proposal is sanctioned as par the delegated business power of the branch.
Head Office
Credit Officer
Credit Committee
Credit Committee
Executive Committee


Fig: Flow Chart of Credit Proposal.
6.6       Tools for Appraisal Credit
The 10 C's of Good and Bad Loan
In addition to the formal credit appraisal, the credit of NBL tries to judge the possible client based on some criteria. These criteria are called the C's of good and bad loans. These C’s are described below:
1. Character: Make sure that the individual or company you are leading to ha outstanding integrity.
2. Capacity: Make sure that the individual or company you are leading to have the   capability of repaying your loan.
3. Conditions     Understanding the business and economic conditions can and will change after the loan is made.
4. Capital: Make sure that the individual or company you are leading to has an appropriate level of investment in the company.
5. Collateral: Make sure that there is a "Second way out" of a credit but do not allow  that to drive the credit decision.
6. Complacency: Do not rely on past history to continue. Start alert to what can go wrong  in any loan.

7. Carelessness: Remember that documentation, follow-up and consistent monitoring are essential to high quality loan portfolio.
8. Communication: Share credit objectives and credit decision making both vertically   and laterally within the bank.
9. Contingencies: Make sure that you understand the risk, particularly the downside possibilities and that you structure and price the loan consistently with that understanding.
10. Competition: Do not get swept away by what others are
Other tools of good and bad loans are as foil

  1. Liquidity.
  2. Profitability.
  3. Purpose of Loan.
  4. Nature of Loan.
  5. Source of repayment.
  6. Diversification of Investment.
Vertical/Common size analysis: A technique for evaluating financial statement that expresses each item within a financial statement in terms of a percent of a base amount.
Horizontal / Trend analysis: It is a technique for evaluating a series of financial statement over a period of time.
And lastly the comparison of ratio can be made by three procedures which are as follows_
Inner firm comparisons: It refers to evaluate data by years of a same company.
Inter firm comparisons: It refers to evaluate data by based on competitors in the same industry.
Industry average: It refers the type of comparisons based on average ratios for a specific industry.
As we are banker, for assessing financial statements and weakness of a proposed/existing borrower, presently we are considering mainly the liquidity, activity, debt and profitability ration. In financial statements spreadsheet (FSS), we are considering the following ratios for analysis purpose.
Lending Risk Analysis (LRA)
LRA stands for Lending Risk Analysis. LRA is a financial. tool used to analyze the risks associated in a loan proposal. According to Bangladesh Bank order every Bank has to conduct LRA for every loan amounting Tk. 1 Crore and above NBL is frequent user of this technique.
This technique 1stly divides all risks into two broad aspects:
  1. Business risk.
  2. Security risk.
1.         Business risk- This risk can be analyzed from two aspects.
  1. Industry risk.
  2. Company risk.
(a)        Industry risk: Industry risk can be sub-divided into two segments.
  1. Supply risk.
  2. Sales risk.
(Supply risk: It analyzes the risk or failure due to disruption in the supply   of input. Sales risk: This risk arises from the failure due to disruption of sales.)
(b)        Company risk: This risk can be sub-divided into two sectors.
               (i)      Company position risk.
               (ii)     Management risk.
(i)     Company position risk:       It is of two types.
(a)    Performance Risk:   By analyzing performance risk a credit officer can be sure that the company position is so weak that it performs well enough to repay the loan, given expected external conditions.
(b)   Resilience Risk: By analyzing resilience risk a Credit Officer can analyze what the risk of Failure is due to lack of resilience to unexpected external condition.
(ii)        Management Risk- It is of two types:
(a) Management Competency risk: Management competency risk is the risks of failure due to competency of the management, which run the company.
(b) Management integrity risk: Management integrity risk is that type of risk, which occurred due to lack of management integrity.
(2)  Security Risk: Security risk is basically two types, these are:
  • (a)Security control risk: Security control risk is that type of risk when bank fails to realize the security.
  • (b) Security cover risk: Security cover risk is that type of risk when the realized security value is less than the exposure.
6.9       SWOT Analysis:
This is a technique used by the credit officers to evaluate credit proposal submitted by company especially by the production concern.
S          stands for Strength.
W        stands for Weakness.
O         stands for Opportunity
T          stands for Threats.
This analyzes the inherent strength of the company, resilience, brand loyally, endowments etc.
It analyzes the inherent weakness of a company, such as management supply risk etc.
This analyzes the opportunity which will be available to a company in near future, such as tax, incentives, export credit facilities etc.
It analyze the threats which may face by the company such as legal barrier, withdraw of tax, exemption, international law, withdraw of most favorable nation (MFN) and GDP facilities etc.
6.10     CIB Report from Bangladesh Bank:
It stands for Credit Information Bureau report. CIB is a department by Bangladesh Bank to help the all-banking and financial Institutions by providing the latest report in the customers, who enjoy credit for facilities more than 10 Lac Taka. According to Bangladesh Bank order no bank can provide only credit facilities more than Tk. 10 Lac, without having CIB report from Bangladesh Bank. If there is any adverse report on raw customer, which represent-classified loan no bank can provide any credit facilities to that customer. This is a unique facility provided by Bangladesh Bank to its entire member Bank/Financial Institutions. Even the Central Bank of India does not provide this type of facilities through there is some credit rating agencies in India. This report includes various latest information's on the customer having outstanding liability of Tk. 10 lac and above and recently Bangladesh Bank is making arrangement to make it to Tk. 1 lack and above. In addition to legal obligation this report helps a credit officer to evaluate a customer along with its all sister concerns/partners.
6.11.1 Bank Perspective:
NBL is a unique characteristic in its loan Management. To make it sure that, there will be no bad loan in its loan portfolio; NBL established a loan monitoring and supervision cell headed by an Assistant Vice President under the nursing of its chief advisor. They frequently visit customer premises/business whether the loan amount which is taken is used properly or not, sometimes it happens that customers need more fund or other type of facilities to run its business : profitably. The monitoring authority takes necessary steps to meet the customers need.
6.11.2 Bangladesh Bank Perspective:
The Bangladesh Bank formulates and implements monetary and Bank supervision policies and advises the Government on economic policy within the framework of the Bangladesh Bank order 1972. The Banking companies/company Act, 1991 and the Financial Institution Act, 1993 that give the Bangladesh Bank general powers to direct banks and financial institutions to conduct monetary policy and to specify and implements prudential rules and requirements.
Bangladesh Bank is empowered to conduct inspection of the scheduled Bank under section 44 of Banking companies Act, 1991 Section 44 of the Act says the Bangladesh Bank at any time may either, or its own motion or on being directed to do so by the Government shall, cause an inspection to be made by one or more of its of any banking company and its books of account.
An inspection team normally consisting of a Deputy Directors as a term leader and two Assistant Directors inspects each bank branch. In case of large branches having advances of Tk. 5.00 Crore and above a Joint Director leads the inspection team instead of a Deputy Director. The leader of the team fixes up time and place where the team wills meet on the date of Inspection. The leader of the team is supplied with a. directive for inspection, which is addressed to the Manager of the branch co'\1cerned. The team reaches the concerned bank branch before it opens for transactions and cash is brought out of the vault. The first duty of the team is to take into their custody. Casebook and general ledger before starting physical verification of cash balance. It includes the verification of foreign currencies, prize bonds, stamp and stamp papers and stock of checkbooks, D. D. forms and shares & securities. Usually the books off account of the book are examined as on a particular data but inspections, especially to find out cases of violation of Bank Company Act, 1991, Credit restrictions and other instructions issued by Bangladesh Bank and Government from time to time.
Normally after loan sanction, bankers are taking care of the client performance. Renewal of the loan is depends on the performance report. In performance report the transaction between bank and the client are recorded. So when turnover of the loan is high then it is good client. If the client takes his allowed loan and deposit it few times, then the client is less risky but the bank can’t get more benefit from the client because of low turnover. Bank expected higher turnover to get more benefit. Performance report will show all of this. Performance report show the debit and credit transactions average balance for the period, average monthly debit, average monthly credit, account’s highest balance, account’s lowest balance, number of time loan adjusted. According to performance report bank make a list of good and bad borrower and show the present position of the clients and rank them according to good or bed borrower.
6.13     SECURITY
It is essential that the proposal define clearly the purpose of the facility, the sources of the repayment, the agreed repayment schedule, the value of security (Land, Machinery’s, Security paper, etc.) and the customer relationships consideration implicit in the credit decision.
Where security is to be accepted as collateral for the facility all documentation relating to the security shall be in the approved form.
All approval procedures and required documentation shall be completed and all securities shall be place, prior to the disbursement of the facilities.
The bank for creation of mortgage on the property- requires the following documents:
  1. Original Sale Deed favoring owner of the landed property.
  2. Certified copy of Mutation Khatian.
  3. Duplicate Carbon Receipt (DCR).
  4. Certified copy of the Sale Deed of the previous owner of the same property.
  5. Up-to-date Rent receipt and Municipal Tax Receipt.
  6. Clearance from RAJUK / WORKS MINISTRY (if the property is lease hold property of any of them) in connection of availing the loan facility from National Bank Limited, Mohakhali Branch, Dhaka by mortgaging the property. Valuation Certificate.
  7. RAJUK approved plan of the building with the approval letter.
  8. Site Plan / Mouza Map
  9. Photograph of the property from three different angles and the owner of the landed property.
  10. Board Resolution for mortgaging the property if the same belongs to any Limited Company.
  11. Certified copy of CS, S.A, and R.S Khatians.
  12. The borrower is request to submit the above-mentioned papers in original for verification by the bank lawyer and creation of mortgage on the property intended to mortgage against the advance.
A document is a written statement of facts of proof or evidence arising out of particular transaction, which on placement may bind the parties there to answerable and liable to the court of law for satisfaction of the charge in question. Document is necessary for the acknowledgement of debt by the borrower and charging of securities to the bank by him. Proper and correct documentation is essential not only for the safety of an advance but also necessary for taking legal action against the debtors in case of non-payment of dues. Depending on the types of loans & advances different documents are required. Such as:
6.14.1  Loan
  1. Demand Promissory (D.P) Note.
  2. Letter of partnership (in case of partnership concerns) or Resolution of the Board of Directors (in case of Limited Companies).
  3. Letter of arrangement.
  4. Letter of disbursement.
  5. Letter of pledge (in case of pledge goods).
  6. Letter of hypothecation (in case of advances against shares).
  7. Trust Receipts (in case of L TR facility).
  8. Letter of lien and transfer authority (in case of advance against PSP, BSP, etc.)
  9. Letter of lien and ownership (in case of advance against shares).
  10. Letter of lien for packing credits (in case of Packing Credit).
  11. Letter .of lien (inc case of advance against FDR)
  12. Legal documents for mortgage of property.
6.14.2  Overdraft
  1. Demand Promissory (D.P) Note.
  2. Letter of arrangement.
  3. Letter of partnership (in case of partnership concerns) or Resolution of the Board of Directors (in case of Limited Companies).
  4. Letter of continuity.
  5. Letter of lien (in case of advance against FDR).
  6. Leal documents for mortgage of property (as drafted by Legal Adviser).
  7. Letter of lien and transfer authority (in case of advance against PSP, BSP, etc.)
  8. Letter of lien and ownership (in case of advance against shares).
6.14.3  Cash Credit
               1.      Demand Promissory (D.P) Note.
               2.      Letter of arrangement.
               3.      Letter of partnership (in case of partnership concerns) or Resolution of the Board of Directors (in case of Limited Companies).
               4.      Letter of continuity.
               5.      Letter of pledge (in case of pledge goods).
               6.      Letter of hypothecation (in case of advances against shares).
               7.      Letter of continuity.
                8.     Letter of lien (in case of advance against (FDR).
                9.     Leal documents for mortgage of property (as drafted by Legal adviser)
              10.      Letter of lien and transfer authority (in case of advance against PSP,                   BSP, etc.)
              11.      Letter of lien and ownership (in case of advance against shares).
6.14.4   Bill Purchase
  1. Demand Promissory (D.P) Note.
  2. Letter of hypothecation Bill.
  3. Letter of arrangement.
  4. Letter of partnership (in case of partnership concerns) of Resolution of the Board of Directors (in case of Limited Companies).
All required documents, as enumerated above, should be obtained before any loan is disbursed Disbursement of any credit facility requires approval of the competent authority that should ensure, before exercising such delegated authority, that all the required documentation's have been completed.
Progotishoroni Branch like other branches ensures proper documentation’s and submission of monthly statement to Head Office on prescribed format confirming such compliance.
6.14.5 Short notes of these documents
  1. Demand Promissory Note (D.P. Note)- Joint and Several D.P. Note for limited company.
  1. Letter of Disbursement- The loan amount has been sanctioned in favoring the customer.
  1. Letter of Hypothecation with supplementary- In case of CC (Hypothecation) and where
    • there is hypothecated charge on goods and Assets.
  1. Letter of continuity- In case of continuity loan as CC (Hypothecation) SOD etc.
  1. Letter of Lien- To be given by the holder/owner of the instrument where PSP, BSP, FDR, 
    • DBDR etc. are kept under lien as security.
  1. Letter of Security Deposit- Where PSP, BSP, FDR. DBDR etc. are kept under lien as security.
  1. Letter of Undertaking- In case of Heir Purchase Loan, Lease Finance, Consumer Credit.
  1. Letter of Installment- In case of loan where loan is repaid in installment.
  1. The landlord gives letter of Disclaimer- To where the customer is at a rental premises.
  1. Personal Guarantee- Proprietor all Directors in case of Limited Company and of the owner of the Property to be mortgage if any.
Credit Policy and Guidelines of NBL
This statement sets out the underlying principles and intention which the Board of Directors has determined how the Bank will carry out in all of its credit activities. The Board has delegated authority to the Managing Director, Head Office Credit Committee and other Officers to approve, direct, monitor and review lending operations throughout the Bank and to ensure that the credit policies are adhered to and the credit operation is conducted in a most effective manner. These policy guidelines refer to all credit facilities extended to customers including placement of funds on the inter-bank market or other transactions with financial institutions. The purpose of this policy statement which replaces all previous ones is to set out the credit policies of the Board of Directors. The policies are described under the following headings:-
Credit Principles
Global Credit portfolio limits
Credit categories
Types of credit activities
Credit approval
Credit administration
Credit monitoring and review
The following are the principles to be adopted for lending authority, approval, monitoring and control on a basis consistent with the global operational objectives and business strategies of the Bank.
7.1.1 General
            –           The Bank shall provide suitable credit services and products for the markets in which it operates.
            –           Loans and advances shall normally be financed from customers' deposits and not out of short term temporary funds or borrowing from other banks.
            –      Credit will be allowed in manners which will in no way compromise the Bank's standards of excellence and to customers who will complement such standards.
            –           All credit extension must comply with the requirement of banking companies Act 1991 and Bangladesh Bank's instructions as amended from time to time.
The authority structure adopted will enable effective adoption to changes in the economic, technological, regulatory and competitive environment within which the Bank operates.
7.1.2    Performance
            –           The conduct and administration of the loan portfolio should contribute, within defined risk limitation, to the Bank's achievement of profitable growth and superior return on the Bank's capital
            –           Credit advancement shall focus on the development and enhancement of customer relationships and shall be measured on the basis of the total yield for each relationship with a customer (on a global basis), though individual transactions should also be profitable.
The nature of credit portfolio shall be governed within guidelines set down by the Head Office Credit Committee and regulatory requirements. These guidelines will however be consistent with the global limits identified below for the Bank's credit portfolio in aggregate. Criteria for exposure to customers are set out below:
7.2.1    Total Facilities
The aggregate of all cash facilities shall not exceed 80% of customer deposits. It is further governed by the statutory and liquidity reserve requirement of Bangladesh Bank.
7.2.2    Term Facilities
Aggregate Bank facilities extended for a period exceeding one year shall not exceed 30% of the total credit portfolio. Facilities shall not be allowed for a period exceeding five years. Any exceptions will require the approval of the Board of Directors.
7.2.3    Country/Cross border Exposure
Limits to be established by the Board for individual country as well as for aggregate Bank Credit exposures to different countries. These limits are to be reviewed from time to time with due regard to the political and economic environment in each country. The country exposure limits may be utilized up to maximum amounts for different maturities as follows:-
                        For maturities up to one year: 100% of the limit.
                        For maturities up to two years: maximum 50% of the limit.
                        For maturities up to three years: maximum 25% of the limit.
                        For maturities beyond three years: maximum 10% of the limit.
                        For exceptions, reference is required to the Board of Directors.
Exposure to Customer Groups
Credit facilities in aggregate extended to any one customer group shall not exceed 15% of the capital funds of National Bank Ltd. Should any branch, subsidiary or affiliate propose a facility which would result in the aggregate exposure to that risk related group exceeding 15% of capital funds of the Bank, this fact shall be specifically drawn to the attention of the Head Office Credit Committee or Board of Directors. All proposals submitted to the Head Office Credit Committee will also be required to indicate the extent of the Bank's global exposure to that customer group.
7.2.5    Unsecured Facilities
Aggregate Bank advances to corporate or individual customers (i.e. other than government or parasitical organizations) which are not secured by collateral and are allowed on the strength of customer's personal integrity and financial standing or the corporate customer's balance sheet, with or without hypothecation of stock shall not exceed 30% of the total credit portfolio.
For the unsecured credit facilities extended to a business dominated by one or two individuals, the bank shall insist on taking Life Insurance Policies by the principals which is sufficient to repay the loan in the event of death or injury of any one key individual. The policy to be assigned to the Bank and the premium to be paid by the customer through the Bank under suitable arrangement.
7.2.6    Industry Concentration
Limits are to be established and reviewed from time to time for aggregate Bank Credit exposure to any one industrial sector. A facility will be allocated to the industry in which the facility is to be utilized. Standard industry classifications are to be used; these will be reviewed from time to time appropriate margin of security will be taken to reflect such factors as the disposal costs or potential price movements of the underlying assets.
As initiated by Bangladesh Bank vide BCD Circular No.33 dated 16-11-89 different kinds of lending were subdivided into 11 categories w.e.f. 01-01-90 which had subsequently been reduced to 9 vide BCD Circular No.23 dated 09-10-93 and again to 7 prime sectors vide BCD Circular No.8 dated 25-04-94 for fixation of rates of interest by the individual banks on competitive basis reviewing the prevailing market condition and monetary policy of the country.
            Loans and advances have primarily been divided into two major groups:
            a)         Fixed term loan: These are the advances made by the Bank with fixed repayment schedules. The term of loan are defined as follows:
                        Short term: Up to 12 months.
                        Medium term: More than 12 and up to 60 months.
                        Long term: More than 60 months.
            b) Continuing credits: These are the advances having no fixed repayment schedule, but have an expiry date at which it is renewable on satisfactory performance.
Further all categories of loans have been accommodated under the 7 prime sectors as under:
7.3.1    Agriculture  
Credit facilities for the agricultural sector falls under some category; it is subdivided into two major heads:
            a) Loans to primary producers: This sector of agricultural financing refers to the credit facilities allowed to production units engaged in farming, fishing, forestry or livestock. Loans to processors or traders of agricultural products are not to be categorized as agricultural loans.
Loans to tea gardens for production are treated as agricultural loan, but loans to tea gardens for export should be treated under the category "Export Credit." Similarly medium and long term loans to tea gardens are categorized as industrial term lending.
            b) Loans to input dealers/distributors: It refers to the financing allowed to input dealers and (or) distributors in the agricultural sectors. Agricultural loans may include short, medium and long fixed term loans as well as continuing credits. As such it may fall under the head "Loan (Gen)" as well as under "Cash Credit."
7.3.2    Term Loan for Large & Medium Scale Industry
This category of advances accommodate the medium and long term financing for capital structure formation of new Industries or for BMRE of the existing units who are engaged in manufacturing goods and services. Term financing to tea gardens may also be included in this category depending on the nature and size.            As the financing under this category have fixed repayment schedule it falls under the head "Loan (Gen)."
7.3.3    Working capital
Loans allowed to the manufacturing units to meet their working capital requirements, irrespective of their size – big, medium or small, fall under the category.
These are usually continuing credits and as such fall under the head "Cash Credit."
7.3.4    Export Credit
Credit facilities allowed facilitating export of all items against confirmed export orders fall under this category. It is accommodated under the heads "Export Cash Credit (ECC)," "Packing Credit (PC)," "Foreign Documentary Bills Purchased (FDBP)," etc.
73.5     Commercial Lending
Short term loans and continuing credits allowed for commercial purposes other than exports fall under this category. It includes import financing, financing for internal trade, service establishment, etc. No medium and long term loans are accommodated here. This category of advances are allowed in the form of (i) Loan against imported merchandise (LIM), (ii) Loan against trust receipt (LTR), (iii) Payment against import documents (PAD), (iv) Secured overdraft (SOD), (v) Cash Credit (CC), (vi) Loan(Gen), etc for commercial purposes.
7.3.6    Term loans to Small & Cottage Industry
These are the medium and long term loans allowed to small & cottage manufacturing industries [Small industry is presently defined as those establishments whose total investment in fixed capital such as land, building, machinery and equipment (excluding taxes and duties) does not exceed 30 million taka and investment in machinery and equipment (excluding taxes and duties) does not exceed 10 million taka. Cottage industries also fall within this definition].
No short term or continuing credits are to be included in this category. Medium & long term weaver credits are also included under this category. Like the Large & Medium Scale Industry it is also allowed in the form of "Loan (Gen)."
7.3.7    Others
Any loan that does not fall in any of the above categories is considered under the category "Others." It includes loan to (i) transport equipments, (ii) construction works including housing, (iii) work order finance, (iv) personal loans, etc.
Depending on the various nature of financing, all the lending activities have been brought under the following major heads:
7.4.1    Loan (General)
Short term, Medium term & Long term loans allowed to individual/ firm/industries for a specific purpose but for a definite period and generally repayable by installments fall under this head. This type of lending are mainly allowed accommodating financing under the categories (i) Large & Medium Scale Industry and (ii) Small & Cottage Industry. Very often term financing for (i) Agriculture & (ii) Others are also included here.
7.4.2    House Building Loan (General)
Loans allowed to individual/enterprises for construction of house (residential or commercial) fall under this type of advance. The amount is repayable by monthly installment within a specified period. Such advances are known as Loan (HBL).
House Building Loan (Staff)
Loans allowed to our Bank employees for purchase/construction of house shall be known as Staff Loan (HBL).
Other Loans to Staff
Loans allowed to employees other than for House shall be grouped under head – Staff Loan (Gen).
7.4.5    Cash Credit (Hypo)
Advances allowed to individual/firm for trading as well as whole-sale purpose or to industries to meet up the working capital requirements against hypothecation of goods as primary security fall under this type of lending. It is a continuous credit. It is allowed under the categories (i) "Commercial Lending" when the customer is other than a industry and (ii) "Working Capital" when the customer is an industry.
7.4.6    Cash Credit (Pledge)
Financial accommodations to individual/firms for trading as well as whole-sale purpose or to industries as working capital against pledge of goods as primary security fall under this head of advance. It is also a continuous credit and like the above allowed under the categories (i) "Commercial Lending" and (ii) "Working Capital."
8.4.7    SOD (General)
An advance allowed to individual/firms against financial obligation (i.e. lien of FDR/PSP/BSP/Insurance Policy, etc) and against assignment of work order for execution of contractual works falls under this head. This advance is generally allowed for a definite period and specific purpose i.e. it is not a continuous credit. It falls under the category "Others."
7.4.8    SOD (IMPORT)
Advances allowed for purchasing foreign currency for opening L.C for import of goods fall under this type of lending. This is also an advance for temporary period which is known as pre-import finance and falls under the category "Commercial Lending."
7.4.9    PAD
Payment made by the Bank against lodgment of shipping documents of goods imported through L.C. falls under this head. It is an interim advance connected with import and is generally liquidated shortly against payments usually made by the party for retirement of the documents for release of imported goods from the customs authority. It falls under the category "Commercial Lending."
7.4.10  L I M
Advances allowed for retirement of shipping documents and release of goods imported through L.C. taking effective control over the goods by pledge in godowns under bank's lock & key fall under this type of advance. This is also a temporary advance connected with import which is known as post-import finance and falls under the category "Commercial Lending."
7.4.11  L T R
Advance allowed for retirement of shipping documents and release of goods imported through L.C. without effective control over the goods delivered to the customer falls under this head. The goods are handed over to the importer under trust with the arrangement that sale proceeds should be deposited to liquidate the advances within a given period. This is also a temporary advance connected with import and known as post-import finance and falls under the category "Commercial Lending."
7.4.12  I B P
Payment made through purchase of inland bills/cheques to meet urgent requirement of the customer falls under this type of credit facility. This temporary advance is adjustable from the proceeds of bills/cheques purchased for collection. It falls under the category "Commercial Lending."
7.4.13  E C C
Financial accommodation allowed to a party for exports of goods falls under this head and is categorized as "Export Credit." The advances must be liquidated out of export proceeds within 180 days.
7.4.14  P C
Advance allowed to a party against specific L.C/firm contract for processing/packing of goods to be exported falls under this head and is categorized as "Packing Credit." The advances must be adjusted from proceeds of the relevant exports within 180 days.
7.4.15  F D B P
            Payment made to a party through purchase of a Foreign documentary bills falls under this head. This temporary advance is adjustable from the proceeds of the negotiable shipping/export documents. It falls under the category "Export Credit."
7.4.16  L D B P
Payment made to a party through purchase of local documentary bills falls under this head. This temporary liability is adjustable from proceeds of the Bill
The primary factor determining the quality of the Bank's credit portfolio is the ability of each individual counterpart to honor, on a timely basis, all credit commitments made to the Bank. This must be accurately determined by the authorizing credit personnel prior to credit approval. The credit approval process shall be governed by the Bank Credit policy framework which can be summarized under the following headings:-
7.5.1    Credit Evaluation Principles
To have the optimum returns from the deployed funds in different kinds of lending, more emphasis shall be given on refund of loans and advances out of funds generated by the borrowers from their business activities(cash flow) instead of realization of money by disposing of the securities held against the advance which is very much uncertain and time consuming.
Accordingly the credit evaluation principles must be adhered to at every level of approval.
The lending risk analysis tool containing analysis of both the business risk and security risk provides overall ratings of risk in a particular loan under the following lending process:
                        –           Assess risk of failure to repay.
                        –           Decide whether to accept or reject a loan proposal.
                        –           Set price and terms.
                        –           Obtain sanctioning documents and disburse loan.
                        –           Monitor performance and ensure repayment/recovery.
The most pertinent and prime part of the process is assessment of risk of failure to repay which deals with the overall lending risk combining the business risk and the  security risk in a matrix derived out of six segments of the Business risk viz. (i) Supplies risk, (ii) Sales risk, (ii) Performance risk, (iv) Resilience risk, (v) Management competence risk & (vi) Management integrity risk and two segments of the Security risk viz. (i) Security control risk & (ii) Security cover risk.
The overall matrix provides four kinds of lending risk for decision makers viz. (i) Good, (ii) Acceptable, (iii) Marginal and (iv) Poor which are detailed in the Lending Risk Analysis Manual.
Bank shall not approve any lending having an overall risk as "marginal" and "poor" without proper justifications except for renewal of existing facilities under compelling circumstances or for other reason such as salvage which shall also contain covenants for future improvement of the position. All credit applications rated "Poor" shall require the approval of the Board regardless of purpose, tenor or amount.
Credit Risk Assessment:
The importance of a detailed and complete credit risk assessment for each facility and customer relationship cannot be over emphasized. The steps that should be followed in carrying out such an assessment are set out in the Bank advances manual and in Head Office Circular issued from time to time. It is the absolute responsibility of the proposing Officer to ensure that all necessary proposal documentation is collected before the facility request is sent to the authorizing Officer.
7.5.2    Authority
Credit will be extended in accordance with the authority levels approved/delegated by the Board of Directors from time to time.
The responsibilities for Credit Policy, procedure, approval & review shall vest amongst the following groups:-
            A)        Board of Directors:
                   1)  Establishing overall policies and procedures for approving & reviewing Credits.
                   2)  Delegating authority to approve and review Credits.
                   3)  Approving Credit for which authority is not delegated.
                   4)  Approving all extensions of credit which are contrary to Bank's written credit policies.
                   5)  Approving all credit applications in support of credit to a classified                                    borrower.
            B)        Finance Committee:
            Finance Committee to be constituted by the Board and shall be responsible for
            1)         Exercising the power of the Board in all Credit matters.
                        2)         Establishing lending policy.
                        3)         Establishing policies and procedure for reviewing and analyzing extensions of credit and loan portfolios.
                        4)         Supervising the implementation of the directives of the Board of Directors.
5)         Approving credit facilities beyond the delegated authority of the Management.
6)         Reviewing of each extension of credit approved by the Head Office Credit Committee/Managing Director.
                        7)         Keeping the Board of Directors informed concerning all the above.
            C)        Head Office Credit Committee:
Head Office Credit Committee will be headed by the Managing Director; other members will be nominated by him. The committee shall be responsible for:
1)         Reviewing, analyzing and approving extension of credit in accordance with authority established and delegated by the Board of Directors.
                        2)         Evaluating the quality of lending staff in the Bank & take appropriate       steps to improve upon.
3)         Recommending Credit proposals to the Finance Committee which are beyond their delegated authority.
4)         In exceptional circumstances when approval of an extension of Credit is required at short notice, the proposal may be referred by the Branches directly to the Head Office Credit Division by Telex/Fax. The Head of the Credit Division with the approval of Managing Director and in case where the amount exceeds the Authority of the Management with the approval of both the Managing Director & the Chairman of the Board of Directors may approve the extension. All such approvals, together with the appropriate supporting documentation, must be submitted to the Head Office Credit Committee (and Finance Committee if necessary) for information and post-facto approval at their next regular meeting.
            5)         Reviewing of credit facility approved by the Regional Credit Committee & Branch Credit Committee.
            6)         Ensuring that all elements of the credit application i.e. forms, analysis, statement and other papers have been obtained and are in order.
            7)         Confirming that the transaction is consistent with existing loan policy and Bangladesh Bank guidelines & if not the Committee may prepare a recommendation for an exception to or a change in policy for consideration by the Finance Committee/Board of Directors.
D)        Regional Credit Committee:
The Regional Credit Committee will be headed by the Regional Manager (where the bank will appoint a Regional Manager to manage a number of branches) and be constituted by the Managing Director.
            The responsibilities will include
                        1)         Evaluation of lending officer (Branch Manager/Credit Officer), approving credit within the authority delegated.
                        2)         Ensuring that credit proposal submission to Head Office are complete and consistent with established policies and procedures.
                        3)         Maintaining an efficient credit practices, procedure and personnel within the Region and developing program and action plan for overcoming weaknesses.
                        4)         Review of credit facility approved by the Branch credit Committee.
            E)        Branch Credit Committee:
Branch Credit Committee to be headed by the Branch Manager and other members to be selected by the Regional Manager in consultation with Head Office.
The Branch Managers will be the first line lending officers and are responsible for exercising their authority with due diligence and discipline. They must also:
                        i)          Know their borrower fully;
                        ii)         Comply with the applicable instructions, manuals, circulars and other parallel rules of the Bank as well as those of Bangladesh Bank including Banking companies Act 1991 (as amended from time to time).
                        iii)         Ensure that credit proposal submission to Regional Credit Committee and/or to Head Office Credit Committee is complete and consistent with established policies and procedures.
                        iv)        Review and analyze the following in connection with credit risk proposals covering any one obligor:
                                    a)         history of antecedent of the obligor and its management personnel.
                               b)  Financial condition of the obligor evidenced by comparative statement, latest Balance Sheet, income statement, operating results and supplementary facts.
                               c)  Bank & Credit Information Bureau (CIB) checking and trade standing obtained through investigation.
                                    d)         Any other pertinent information.
                        v)         Secure necessary and adequate legal & banking documentation as well as insurance cover, all in our favor to ensure maximum legal protection. They should also ensure that all charge documents, securities, collateral, etc. as per sanction letter have been obtained prior to disbursement.
                        vi)        Comply with necessary and customary internal & external control & safeguard.
                        vii)        Ensure continuing review of the risks and exposure and compliance with limits with particular attention being paid to term loans. At the minimum the following should be done:
a)         Every month all credit facilities should be reviewed by the Branch Manager along with other members of credit committee.
b)         Ensure that all loan covenants are being complied with.
c)         Review that regular deposits are being made in the accounts especially for CC & SOD limits and the deposits commensurate with limits and business.
d)         Ensure verification of stock reports by his authorized officer every month.
e)         Visit the Business establishment/factories/office of the borrower once in a month to review business position, profitability, future projection, etc. and prepare a report of the findings which is copied to Head Office/Regional Office.
                        viii)    Ensure that all credit facilities are covered by appropriate approval and that they are kept within approved limits and ensure compliance with terms and conditions of the approval.
The principal elements of Bank credit administration are as follows:
                        a)         Credit approval
                        b)         Credit files maintenance
                        c)         Facility evidence maintenance
                        d)         Credit monitoring and review
7.6.1    Credit File Maintenance
The credit file on each facility shall contain all information necessary to facilitate ready monitoring of that facility. It should contain a thorough history of the customer relationship to
                        –           help credit officers track any problems,
                        –           assist a newly assigned credit officer in understanding the                                    customer and
                        –           make the lending process transparent.
The maintenance of credit files shall be disciplined to force the lending officer to obtain all relevant documents and encourages him to consider all relevant information when analyzing customer risk.
Complete credit files help prevent loan losses resulting from imperfect security documentation.
Primary items in credit files will include:
            a)         Credit application, Credit approval notes/analysis. The analysis should contain information about the borrower, credit purpose, credit repayment sources, collateral security with valuation and guarantees. It should also contain an assessment of the competence and quality of the borrower's management, the general economic and competitive environment of the borrower's industry and any other pertinent factors which may affect the borrower's ability to repay the facility.
            b)         Evidence of credit approval and data upon which approval was granted together with any comments, if appropriate. Copy of sanction letter & loan agreements. A check list of all Legal & Banking documents obtained/to be obtained.
            c)         Details and 6 monthly updated information of all related facilities to the same customer group (Group liabilities information’s).
            d)         All supporting data such as financial statements and analysis thereof, references, credit investigation results, C.I.B. & other Bank reports and notes of all discussions with the borrower and other relevant parties with paper clipping.
            e)         Correspondences, call reports, site visit reports. Each credit file shall be maintained in a secured location and access restricted to authorized personnel. Copies of the information may be kept where regular access is required.
7.6.2    Facility Evidence Maintenance
All legal and banking documentation and register of security shall be maintained, at the branch, separately from the credit file in a location of utmost security. Such documentation may include:
            1-         All charge documents as prescribed by the Bank & local laws, for the relevant credit facility.
            2-         Signed Credit agreement.
            3-         Signed guarantees or other evidence of credit security or collateral agreements.
            4-         Where collateral is taken, the original documents of title reports on the collateral concerning its existence, location and value should be held in the secured location.
            5-         All legal & banking documentation shall be kept in fire proof safe under dual custody of Branch Manager or his designate alternate and another officer. A register of security documents shall be maintained under the supervision of Branch Manager.
7.7.1    Responsibility
It is the responsibility of the Manager to monitor the overall profile and risk aspect of the credit portfolio in accordance with the criteria set down in the Bank credit policy. Such monitoring shall be evidenced from the comments of the Manager in monthly call/visit reports of the assigned officers and be kept in the credit file with copy to Regional Office/Head Office.
This review shall be formally performed at intervals prescribed by Head Office but it is the responsibility of the Manager to ensure at all times that the credit portfolio meets the standard set forth by the Bank.
Periodic review and follow-up should, inter alias, aim at ensuring:
            a)         that terms of approval have been adhered to;
            b)         that conduct (turnover, regularity of repayments, etc.) of the borrowing accounts during the period under review has been satisfactory or as expected;
            c)         that the continuing value of collateral is adequate;
            d)         that there are no adverse trends in market, economic and political conditions which may endanger the reliability of the facility;
            e)         that the borrower's business is being satisfactorily conducted as reflected through a review and analysis of their financial and operating statements and detailed information such as quality of the inventory, ageing of receivables, trend in sales and profitability, liquidity and cash flow situation, maintaining various ratios, particularly those stipulated by Bank at the time the facility was granted, etc;
            f)          that the business reciprocity offered and received is commensurate with the facilities allowed;
            g)         That earnings from the account are cost effective (i.e. adequate to meet direct cost of funds and leave sufficient margin for adequate risk reward, overheads and profits).
7.7.2    Assessment of group exposure
If facilities to any one customer group are booked in a number of locations a designated officer shall be responsible for the management of the Bank's global exposure to that customer group. Any developments in the customer's circumstances which may affect the management of the facility and in particular the credit rating assigned to the customer, shall be documented and advised to the designated officer.
To ascertain repaying ability of each customer a formal assessment shall be carried out on a regular basis. Where a facility is secured, the advance should be based on the current value of the underlying asset. The frequency of these assessments will depend on the quality of the facility which is based on the classification ratings set out below:
a)         Sub-standard Advances:           
This classification contains accounts where irregularities have occurred but where such irregularities are considered to be either "technicalities" or temporary in nature. The main criterion for a sub-standard advance is that despite these "technical" or temporary irregularities no loss is expected to arise. These accounts will require close supervision by management to ensure that the situation does not deteriorate further.
Provisions @ 10% of the base is required for debts in this classification where base is the outstanding balance less interest kept in Interest Suspense Account less the value of eligible securities.
b)         Doubtful Debt:
This classification contains debts where doubt exists over the full recoverability of the principal and/or interest. Although a loss is anticipated it is not possible at this stage to quantify the exact extent of that loss. Management is required to pursue such debts with the utmost resolution to either avoid or minimize the Bank's losses.
Provisions @ 50% of the base are required for debts in this classification.
c)         Bad Debts:
            These facilities are considered to be uncollectible or worthless even after all security has been exhausted and shall be provided for @ 100% of the base.
d)         Special Mention:
Facilities requiring special monitoring are to be flagged or put on a watch list. Whilst this is not a debt classification as such this facility will allow the Bank to monitor customer who, though not in breach of their facility agreements, the Bank feels would be prudent to monitor more closely than other facilities. No provision is necessary for this category.
8.7.3    Identification of Delinquent Facilities
A facility can be identified as potentially being 'Delinquent' as above by any of the following persons:
                        a)         Second Officer/Credit Officer at a Branch.
                        b)         Branch Manager.
                        c)         Regional Manager.
                        d)         Head Office Audit Division.
                        e)         Head Office Credit Division.
In case any officer in a lending or non-lending function gets information on a Borrower which affects the quality of a credit he must write a memo recording the information addressed to the Branch Manager with a copy to Regional Manager & Head Office Credit Division.
Whenever a facility is identified as 'Delinquent' recommendation is to be sent to Regional Manager and to Head Office with full justification for classification of the facility especially in case of classification as Substandard, Doubtful or Loss. Regional Manager will advise their concurrence or otherwise to Head Office with copy to Branch Manager.
It is the responsibility of the Branch Manager/Second Officer/ Credit Officer to timely identify and to try to take necessary steps to avoid classification of any facility.
Once classified, the Branch Manager must work with the Credit Officer to develop an action plan for restoring the facility to acceptable credit standards and to lessen the chances of a worsening condition leading to a loss.
Classified Loan
Any credit facility where any one or more of the following features is present should be classified
            I) Past due interest or other receivables payment for 180 days.
            ii) Past due principal repayment for 180 days.
            iii) Significant decrease in the value of collateral/securities.
            iv) Weakening in Bank's position as a creditor due to any reason whatsoever.
            v) Significant change in the environment leading to a weakening of the credit.
            VI) Diversion of funds to uses other than what the facility was approved for.
            vii)        Incorrect information supplied by the borrower, which affects his credit standing.
            Viii) Bankruptcy of the borrower.
            ix) Unfavorable Bank/Trade reports (from reliable sources) of the borrower.
            X) Any information which forebodes a future problem or affects the borrower's credit worthiness.
The above list is by no means exhaustive. Any inkling of trouble along the line must be reported appropriately and be followed up.
Responsibilities of Bank’s staffs        
In addition to the Branch Manager, the Second Officer and Credit Officer at a Branch should as a matter of practice, be responsible for follow up of loan agreement covenants and the production of other required information/documentation or action during the life of a facility. They should alert the Branch Manager of any deficiencies/omissions & if not acted upon within a reasonable period, should report the deficiency to the Regional Manager and/or Head Office Credit Division depending on the seriousness of the problem. Obviously, such situation would preclude further disbursement of facilities.
7.7.6    Monitoring of Delinquent Accounts
As soon as an account is classified delinquent (in any group) a detailed report will be sent to Regional Manager and Head Office Credit Division by the Branch Manager.
Thereafter a monthly outstanding report on all delinquent facilities is to be prepared by the Second Officer which will be sent to Regional Manager and to Head Office Credit Division jointly signed with Branch Manager.
This monthly outstanding statement should be accompanied by a status report and future action plan to upgrade the facility to satisfactory status from the Branch Manager.
            A.        specific an loss reserve:
                        At the end of each year, Head Office will review:
                        i) Lists of classified Accounts where no loss is anticipated.
                        ii) List of classified Accounts where partial or total loss is expected.
                        iii) Audit Reports by Audit Division and Bangladesh Bank.
                        iv) Previous and current review of the credit portfolio by external Auditors.
                        v) Branch Manager & Regional Managers comments on classified credit facilities on the basis of the above review and knowledge & information of loans and advances available, the Head Office Credit Division in consultation with the Branch Manager & Regional Manager, will prepare a list of accounts which are considered to be partially or totally unrecoverable. This list will be discussed in the Regional Credit Committee which will finalize recommendations for making specific provision against each account. This final list will then be discussed with the External Auditors, and an agreement or consensus will be reached as to the adequacy of the provisions. The list of facilities against which specific provisions are required to be made will then be submitted to Finance Committee/ Board of Directors specifying the amount of provision required in each case. After approval of the Finance Committee/Board of Directors necessary arrangement will be made for booking necessary entries for the provisions.
            B.         General Loan Loss Reserve:
This relates to latent bad and doubtful debts which are present in the portfolio of any bank. The policy of National Bank Ltd is to maintain such reserves against the total credit portfolio as may be decided by Bangladesh Bank and/or Finance Committee/Board of Directors from time to time.
7.7.8    Procedure for writing-off bad debts
All requests for the writing-off of irrecoverable credit facilities will be initiated by the Branch Manager after all avenues for recoverability of the account have been exhausted and that no purpose is served by retaining the account on our books. He will forward the case to Regional Manager. The Regional Manager will satisfy himself as to the findings of the Branch Manager if necessary, by conducting a further personal review of the account at the Branch. The Regional Manager will send his recommendation to Head Office Credit Division.
Detailed Operational Mechanism of Credit
The Credit facilities extended by NBL can be divided in to two ways:

Funded                                                 Non-funded.
Consumer Credit                                   Ø         Letter of Credit
General Loan                                Ø     Bank guarantee
Packing Credit
Hire purchase
Staff Loan
Term Loan
Cash credit against hypothecation.
Small loan scheme
Personal loan
Secured overdraft
Lease finance

When a current account holder is permitted by the banker to draw more than what stands to his credit, such an advance is called an overdraft. The banker may take some collateral security or may grant such advance on the personal security of the borrower. NBL has given this overdraft Facility to clients.
Eligibility : Overdraft facilities are generally granted to businessmen for expansion of their business, against the securities of stock-in-trade, shares, debenture, Government promissory notes, fixed deposit, life policies, gold and gold ornaments etc.
Nature:  short term loan.
Interest rate: 16% per annum.
Terms and conditions:
Bank may cancel/alter the sanction without assigning any reason whatsoever.
In case of client failure to pay the Bank's dues within the algidity of the limit bank may encase client pledge without any prior intimation to client.
8.2.2    Consumer Credit
Consumer credit is a relatively new field of micro-credit activities, people with limited' income can avail of this credit facility to buy any household effects including car, computer and other commercial durable. National Bank Limited plays a vital role in extending the consumer credit.
Eligibility: The borrower must be confirmed official of any of the following
Government Organization
Semi-Government Organization
Multinational Organization
Bank and Insurance companies
Reputed Commercial Organization
Nature: Mid-term Micro Credit
Interest rate: 13.50% per annum.
Terms and conditions:
Credit will procure the specified from the dealer/agent/shop (s) acceptable to bank.
All the papers/cash Memos etc. related to the procurement of the goods will be in the name of the Bank ensuring. Ownership of the goods. Where applicable. The ownership shall be transferred in the name of the client after full adjustment of Bank's dues.
The client shall have to bear all the expenses of License, Registration, Insurance etc. of the articles wherever necessary.
The client shall to bear the cost of Repair and Maintenance of the acquired articles.
Mode of recovery:
Incase of Consumer credit scheme dues shall be recoverable in the following manners:

  • In equal monthly installments.
  • The monthly installment shall be repayable by every month, but
  • The 151 installment shall be payable by the 7th of the subsequent month of disbursement.
  • Through deduction from the monthly salary of the client wherever applicable, by his employer. In this regard the concerned employee shall authorized irrevocable his employer to deduct the said amount from his monthly salary. The authority can only revoked by the client with the concurrence of the Bank.
8.2.3 General Loan
When an advance is made in a lump sum repayable either in fixed monthly installment or in lump sum and no subsequent debit is ordinarily allowed except by way, of interest, incidental charges, etc it is called a loan. The whole amount of loan is debited to the customer’s name on a loan account to be opened in the ledger and is paid to the borrower either in cash on by way of credit to his current/savings account.
Eligibility: Loans are normally allowed to those parties who have either fixed source of income or who desire to pay it in lump-sum.
Interest rate: 14.50% per annum.
Loan disbursement system: One time.
Term and condition:
Disbursement will be made after completion of all formalities.
Bank reserve the right to cancel or amend the terms and condition partly or wholly at is direction without assigning any reason whatsoever.
When the principle debtor in fulfilling this obligation or promise liability bestow on guarantor.
8.2.4    Packing Credit
Packing credit is essentially a short-term advance granted by NBL to an exporter for assisting him to buy process, pack and ship the goods. The credit is generally extended for payment of freight, handling charge, insurance and export duties. The packing credit advances does not normally extend 180 days and has to be liquidated by negotiation/purchase of the export bill covering the particular shipment for which the packing credit was granted.
Eligibility: Packing credit facility has given for small-scale indigenous manufactures or exporters.
Interest rate: 7% per annum.
Term and condition:
r         Disbursement will be made after completion of all formalities as per sanction terms.
r         The amount of advance against packing credit will be adjusted from the amount payable to exporter on negotiation or purchase of the bill.
      The exporter letter of credit should be irrevocable, constricted and valid and confirming Bank must mark lien on it.
December 1,15,46,345.76
November 68,10,364.24
October 1,08,38,302.15
September 99,75,398.76
August 1,08,75,398.76
Source: Monthly Statement of Bangla Bazar Branch.

8.2.5 Hire Purchase
Another form of consumer credit, such as; hires Purchase facility also given by NBL. The feature of Hire Purchase that usually a deposit has to be paid and the rest of the purchase price are spread over a period-six months, two years or sometimes even longer, the article being regarded as the property of the bank until the final payment has been made.
Eligibility: Hire Purchase normally allowed to those persons who have either fixed source of income or who desire to pay it in lump-sum. Interest rate: 14.50% per annum.
Term and condition:
r         The durable will be covered by first party comprehensive insurance policy throughout the loan period and the premium for the policy of each year will be borne by the client.
r         Retailed feasibility report containing marketing, financial, technical and socio-economic aspects showing detailed break­ up of project cost and other usual financial analysis duly supported by its assumption.
8.2.6 PAD (Payment against document)
A loan facility provided by the banks to the customers against document/bills, like, Bill of Lading, Warehouse keepers Certificate/receipts, Railway receipt, Delivery order, Dock Warrant.
In other word, Payment made by the Bank against lodgment of shipping documents of goods important through L/C falls under this head.
It is an interim advance connected with import and is generally liquidated shortly against payments usually made by the party for retirement of the documents for release of imported goods from the customer authority. If falls under the category "Commercial Lending".
Eligibility: This type of credit facilities is given generally Exporter and Importer.
Interest rate: 14% per annum.
Term and Condition:

  1. In the event of default by the borrower ban has the right to sell the goods.
  2. Insurance policy to be obtained against the goods covering fire and RSD risk at the cost of customer.
  3. Bank reserves the right to cancel or amend the terms and condition partly or wholly at its direction without assigning any reason whatsoever.
8.2.7 Personal Loan Scheme
Personal loan is another method of lending by NBL. Under this system, the banker specifies a limit called the credit limit, for each customer, up to which the customer is permitted to borrow against the security of tangible assets of guarantees.
Loan Limit:
Maximum loan limit is TK. 3(three) Lac However, the loan should not exceed eight times of the gross salary per month of the person.
Loan Repayment Period:
The maximum loan period is 3 years i.e., repayable by maximum 36 equal monthly installments..
8.2.8 Cash credit against hypothecation
Cash credit is another method of lending by NBL. Under this "'system, the banker specifies a limit called the cash credit limit, for each customer is permitted to borrow against the security of tangible assets or guarantees. Cash credit in its truest sense is against pledge of goods. Cash credit is sometimes allowed against hypothecation of goods. In case of cash credit hypothecation the ownership an possession of the goods remain with the borrower. By virtue of the hypothecation agreement the bank can take possession with the borrower defaults.
Eligibility: Hypothecation advances are normally allowed by bank to limited companies and businessmen for their working capital and not for any capital investment.
Interest rate: 14.50% per annum.
Renew system: It can be renewed after one year.
Term and condition:
  1. Insurance policy to be obtained against the stocks to be hypothecation covers fire and RSD risk at the cost of the customer.
  2. Stock report to be submitted on monthly basis.
  3. Banks reserve the right to cancel or call back the sanctioned credit limit.
8.3       Non-Funded Credit
8.3.1    Letter of Credit
Opening or issuing letter of credit is one of the important services provided by NBL. A letter of credit is a document authorizing a bank to pay the bearer a specified sum of money; it provides a useful means of settlement for a foreign trade transaction, the purchase establishing a credit in favor of his credit at a bank.
Letters of Credit are two types:
1. Traveler’s letter of credit issued for the convenience of the traveling public and
2.  Letter of commercial credit issued for the purpose of facilitating trade transaction.
Eligibility: Letter of facilities is given credit to exporter, manufacturers / producers.
Rate of Commission:  0.50% per quarter.
8.3.2 Letter of Guarantee
A letter of guarantee has special significance in the business of banking as a means to ensure safety of funds lent to the customers. In case the borrower is unable to provide the security of tangible assets or, the value of the assets falls below the amount of the loans, and the borrower's personal security is not  considered sufficient, an additional security is sought by the banker in the form of a guarantee giver by a third person.
Term and condition:
  1. The banks legal adviser must verify all security documents.
  2. When the principal debtor defaults in fulfilling this obligation or promise the liability bestow on guarantor. Banks reserves the right to cancel or amend the terms and condition party or wholly at its direction without assigning any reason whatsoever.
8.4       Concept of Micro Credit
The credit program that promotes small credit to the poor people for creating self-employment with a view to alleviating their poverty and attaining sustainable development is referred here as micro-credit program. It is especially related to micro level development. This concept is according to different NGO forum mainly in ASHA.
8.4.1 Micro Credit Program of NBL
Consumer Credit is a relatively new field of collateral-free finance of Bank. People with limited income can avail of this credit facility to buy households goods including car, computer and other consumer durable.
The main objective of this scheme is to help the lower mid-class people for purchase different types of household equipment's. And also help to the mid class people for buy car/microbus for personal use.
Lubricant facilities of this scheme is that, the loan amount directly placed to the consumer account and not necessary any collateral security for this loan.
Interest Rate/Service Charge/Risk Fund/Installment:
In case of this credit facility the consumer have to pay 14% of equity,    1 % Service Charge and 1 % Risk fund. Payment should be made by monthly (24 installment up to 1 lac). Within the 151 week of every month. Incase of car, maximum loan amount should be 4 month. Installment amount is compound made (interest with principal). The rate of interest is 14% in case of Consumer Credit Scheme.
8.5       Small loan :This scheme has been evolved especially for small shopkeepers who need credit facility for their business and cannot provide tangible securities. Maximum loan amount of this program is to Tk. 2 lac, which is payable within 2 years (extensional) Creditor have to pay 14.50% interest, Risk Fee 1% and Supervision fee 1 % (for one time).
8.6       Lease Finance. :
This scheme has been designed to assist and encourage the genuine and capable entrepreneurs and professionals for acquiring capital machinery’s, medical equipment’s, computers and other items which may help them to be economically self-reliant.
v         Help the entrepreneurs to buy tools, treatment instrument, car, generator, Air-condition etc.
v    To help improvement of industries in the country.
Categories of Lease Items:
Capital Machinery, Medical Equipment, Automobiles, Air-condition, Lift and Generator etc.
Primary the applicant will mortgage his/her all documents of property and than Land, Bank guarantee, Shanchay Patra, ICB unit certificate etc.
Interest Rate/Services Charge/Risk Fund/Time Limit:
Rate of return of Lease Finance- per annum 15% and service charge 1 % and risk fund 1 % of Loan amount for onetime. Loan amount (with interest) will be paid within 3 to 7 years depend on lease category.
8.7       Rural Development Scheme
Rural Development Scheme has been evolved for the rural people of the country to make them self-employed through financing various income generating activities. This scheme is operated through to rural branches of National Bank Limited. It is also not available at Mirpur Branch.
v         To developing rural people
v         To increasing purchasing power among the rural people.
Loan Limit:
Per person Tk. 5,000 to Tk. 10,000
Group guarantees not essential others.
Interest Rate/Service Charge/Risk Fund/Time Limit:
Rate of return of Rural Development Scheme- per annum 14% and risk fund 2% and Service Charge 1 % for one time. Loan amount (with interest) will be paid within 1 year.
Loan Recovery
Recovery plan is one of the components of performance plan. It is a future intended action in respect of recovery. In other words, it is a conscious and deliberate effort to recover all current dues and overdue loans.
9.1.1    Steps for recovery:
Step 1: (Existing loans and advances):
Make due dates of repayment
Regular follow-up
Periodical inspection
Supervise visit
Step 2: (Overdue loans and advance):
Preparation of quarterly lists likes branch copy, controlling office copy and head office copy.
Attempts are to be made for adjustment of loans before application of quarterly interest.
Loans must be adjusted before classification.
Target for recovery.
Steps for declassification.
Step 3: (Provision for classified loan):
Un classified = 1%
Substandard = 10 ~ 20%
Doubtful = 50%
Classified /Bad / Loss = 100%
Step 4: (Interest exemption):
Finding out the legitimacy of interest exemption it needs to follow the instruction of Bangladesh Bank and head office.
Step 5: (Write off):
Finding out the legitimacy of writing off for a particular loan case it needs to follow the instruction of Bangladesh Bank and head office.
Step 6: (Others):
In case of any other situation, recovery will be happened as the requirements of the Bangladesh Bank and as the requirements of NBL.
Recommendations and Conclusion
10.1     SWOT Analysis of NBL
As we  observed the overall operations of NBL Banglabazar Branch for quiet sometime we could found some of the strengths, weaknesses, opportunities and threats of the branch which would be applicable for the other branches and the NBL as a whole in more or less in the similar manner. A list of those is furnished below:
Sound profitability , growth and internal capital generation.
Larger  individual and corporate client base
Experienced and efficient management team.
Experienced   employees.
Quaity products and services
Better infrastructural facilities and more number of Brs.
Company reputation and goodwill
Declining market share
Decling standard of customer service.
Lack of computer skill among the senior officer.
Reluctance to use technology among the employee.
Lack of full scale automation.
Scope of market penetration through diversified products
Full automation and online  banking in all branches.
Government’s policy of encouraging large DFI.
Regulatory environment favoring private sector development
Value addition in products and services
Increasing trend in international business
Increased competition for market share by other banks
mainly basing on technolgy and good customer service.
Chances of technically expert employee to switch to other banks.
Market pressure for lowering of the interest rate.
Global and national economic ressesion.
Reduced flow of remittence.
10.2                 Suggested Strategy for NBL 
Analyzing the SWOT the following strategies can be suggested for NBL;
            a. Take due measure to improve customer service specially using technology.
            b. Must introduce new value adding product to keep the loyal customers.
            c. NRBs must be attracted with special service to continue with the remittance.
            d. Reduce the lending rate to tackle the economic recession.
Findings and Recommendations Based On the Internship Program.
 On completion of the internship program the findings can be enumerated as follows:
Competitive Banking Market: Many different commercial Bank with diversified product and services are emerging every day, where NBL with little old product and services will really have to struggle to keep its market share. NBL should have strong R&D wing to find new product that assures more value to the customer.
Customer Satisfaction:  At the end of the day it is all that matter for a service providing company like bank is customer satisfaction. Now a days it seems that NBL becoming little sluggish and reluctant to ensure customer service. . NBL should care more for the customer because now there are many options open to the customer to choose.
E-Banking: It is not a point of argument any more that without E-banking a commercial bank will not be able to survive. New banks are ready to provide all services in very quick time and online. These help the customer to save their time and money both. NBL has lot s of room to improve in this aspect. NBL should make a prompt action plan to be fully automated not only with machines but also with the employees.
More Marketing Effort is required: NBL has definitely some new product to launch but it often found that those new products are unable bring any new customer. NBL heavily relies on it huge loyal customer base. We are apprehensive that without an effective marketing effort no new customer will come in and old customers will also not be retained. So NBL should make a great marketing campaign to remain in the market.
Declining Remittance from NRBs; It should be a matter of great concern that the cash flow from foreign remittance is declining which was a main source of NBLs earning. Without a major effort to attract the NRBs remittance flow will not be retained.
Global Economic recession: There is no way to escape the effects of economic recession worldwide. NBL should make all out effort to hedge the effect on its capital as well as find diversified product and services to help the business to recover their losses.
Training Of employees: NBL has plenty of rooms to improve their employees’ Professional knowledge and expertise especially the computer is very important for all level of officers of NBL even the MD.
10.4     Conclusion
The internship program of three month on National Bank Limited at Banglabazar Branch in Dhaka is completed successfully. National Bank Limited is a popular and profitable bank with little old culture and practices in the private banking sector of Bangladesh. It has been giving service to customer since 1983 properly.
We made a humble effort to put my experience and learning in the report. Through the process of learning in the program we made an effort to find the areas where NBL has scope to improve upon. We are making an effort to portray those below:
Competitive Banking Market: Many different commercial Bank with diversified product and services are emerging every day, where NBL with little old product and services will really have to struggle to keep its market share. NBL should have strong R&D wing to find new product that assures more value to the customer.
Customer Satisfaction:  At the end of the day it is all that matter for a service providing company like bank is customer satisfaction. Now a days it seems that NBL becoming little sluggish and reluctant to ensure customer service. . NBL should care more for the customer because now there are many options open to the customer to choose.
E-Banking: It is not a point of argument any more that without E-banking a commercial bank will not be able to survive. New banks are ready to provide all services in very quick time and online. These help the customer to save their time and money both. NBL has lot s of room to improve in this aspect. NBL should make a prompt action plan to be fully automated not only with machines but also with the employees.
More Marketing Effort is required: NBL has definitely some new product to launch but it often found that those new products are unable bring any new customer. NBL heavily relies on it huge loyal customer base. We are apprehensive that without an effective marketing effort no new customer will come in and old customers will also not be retained. So NBL should make a great marketing campaign to remain in the market.
Declining Remittance from NRBs; it should be a matter of great concern that the cash flow from foreign remittance is declining which was a main source of NBLs earning. Without a major effort to attract the NRBs remittance flow will not be retained.
Global Economic recession: There is no way to escape the effects of economic recession worldwide. NBL should make all out effort to hedge the effect on its capital as well as find diversified product and services to help the business to recover their losses.
Training Of employees: NBL has plenty of rooms to improve their employees’ professional knowledge and expertise especially the computer is very important for all level of officers of NBL even the MD.
L.R. Chowdhury: A text Book on Bankers Advances, 2002
H. Weihrich & H Koontz, Management
A Global Perspective, McGraw- Hill. 1993
Dr. A. R. Khan, Bank Management
Prospectus of National Bank Limited.
Annual Report of National Bank Limited (2008 & 2009)
Several Booklets, Brushier, Leaflet etc. from National Bank Limited
Previous Report from Dhaka & ASA University Lab  
Web sites National Bank etc.