Standard Bank Limited
Background of the report
Banks plays the most important role in the economy generally banks collect money from the individuals and lend them to others .Now Banks after the widest range of financial services and perform lot of financial function. Thus, banks have proven that they are the key factor for the business and economy as well.
Year 1983 was the remarkable year for the development of banking section, because government had permitted few banks in the private section. These banks have proven their competence by their operation and help in the growth of the business and commence. Through this report I would to present the overall Banking performance from one of them, which have a great contribution in the growth of Bangladesh economy.
Objective of the Report
• To observe the general banking foreign exchange and advance operation of SBL, and their services.
• To get an overall practical knowledge concerning banking activities as a financial institution.
• How a bank operates their activities in different areas being a single organization.
• What a hank is doing for Bangladesh to develop national economy.
• Presentation of an introduction to the organization—Standard Bank Limited as a whole.
• To get knowledge regarding the Import and Export procedure maintained by the bank as well as foreign trade.
• To get overall idea about the credit and general banking of SBL.
• To recommend necessary steps to overcome such problems faced by the SBL.
· Find out the marketing strategy of SBL and how they formulate their marketing strategy.
• Make overall export import trend analysis.
• To identify the major areas of inefficiency.
Scope of the Report
An infrastructure of the organization has been detailed, accompanied by a global perspective and look into the future. The scope of this report is limited to the overall description of the company, its service, and its position in the market and its marketing strategy. The scope of the study is limited to organizational set up, functions and performances of the Banks various department.
The report is prepared on the basis of information collected from both secondary sources and primary data collection survey. The secondary information was collected from the Standard Bank Limited Annual Report, Prospectus and materials from various statement of the Bank, magazines these are for the organizational part of the report.
Some fundamental steps of Research Methodology have been followed in the course of marketing research activity In my study I have adopted the under mentioned methods to conduct the activity.
Determining the Source of Information
I. Direct interviews with relevant personnel.
11. Expert opinion
III. Official record of Standard Bank Limited
I have used different types of secondary data in my research. Sources of secondary data are as follows:
I. Relevant papers and publications
II. Banks Annual Report
III. Resume of financial activities
IV. Any information regarding Foreign Exchange
I. Different books and periodicals related to Bank activities
Limitations of the Study:
The study has been conducted to make an investigation of the bank’s state of affairs of foreign trade, general banking, credit advances; on the study in this field some problems were created that may be termed as limitations of the study. They are as follows:
• The AGIM of this year is not situated at the time when I done my internee in this bank so I cannot show the last year Bank performance which will make my report more attractive.
• Only Four years statements are taken to consider judging the overall performance of the banks. which are not enough.
• Due to shortage of time this study could not go deep in to details.
• Part of an organizational culture was written from individual’s perception and may vary from person to person.
• In many cases. up to date information is not published.
• Non cooperation by some bank officers to some extent.
• The individual department does not maintain any summary of their work.
• Sufficient hooks. Publications, facts and figures were not available it should have made my report more informative perfectly.
• Relevant papers and documents were not available sufficiently.
• Many procedural matters were written from own observation, which may also vary from person to person.
• Another limitation of this report of this report is Bank’s policy of not disclosing some data and information for obvious reason, which could be very much useful.
• Time allocation (3 months) was too short to learn the overall function, operation and performance of SBL.
• Because of short time period, 1 could not collect the information regarding other branches situated outside of Dhaka City.
• Unavailability of SBL officials for consultations due to their excessive business ilk! Unavailability of required data which were mostly
Short profile of SBL
The word BANK’ means ‘ridge of earth diving field’. It joins the field and help people to walk. The Standard Bank Limited is just like the ridge of earth divining field that join customers by their excellent intermediacy. As we know that the financial institution acts as the intermediary and collects the fund of surplus unit to finance the deficit unit. Standard Bank limited is not exceptional. It collects money from the surplus unit and provide to the deficit unit to balance the fund. Just like the modern bank SBL also perform several functions. These are:
By analyzing all the sides of a modern hank we can say that Standard bank limited is a Modern hank.
Historical Perspective of Standard Bank Limited:
The declaration of the Governments bold and far-sighted decisions to allow banks in the private sectors to play its due role in the economy of Bangladesh, have started the process of creating new and dynamic financial institutions. One such institution is the Standard Bank Limited (SBL). The emergence of Standard Bank Limited in the private sector is an important event in the banking arena of Bangladesh. Standard Bank Limited came into existence as a Public Limited Company incorporated in Bangladesh on May 1999 with the primary objectives to carry on all kinds of banking business in and outside of Bangladesh. Standard Bank Limited is one of the largest Commercial Bank in Private Sector in Bangladesh. It tries to provide mass banking services to the customers through its branch all over the country. This Bank has been playing a vital role in socio-economic. industrial development as well as in the overall economic development of the country since its inception through savings mobilization and investment of funds.
“Setting a new standard in banking” with a motto to grow as a leader in the private banking arena of Bangladesh through better counseling and effective service to client and thus to the economy of the country. SBL resumed its operational activities initially with an authorized capital of Tk.1250 million. Into 330.00 million shares of Tk.100 each and paid up capital of Tk.660.00 million after IPO. The first Board of Directors of SBL constituted by the Government of Bangladesh, consisted of 16 Directors from various business and professions.
Standard Bank Limited
Metropolitan Chamber Building (3rd Floor)
Registered & 122-124, Motijheel C/A
Head Office Dhaka
Phone: 9667224, 9667802
(PABX) 9560299, 9558375
Telecommunication Mobile:0 171-685095
FAX: 9550597, 9667 137
Telex: 642488 STL PB BJ
Authorized Capital: Tk.1250.00 million
Capital Paid up Capital: Tk. 200.O0million
3, 300, 00 ordinary shares of Tk.l0Oeach.
No. of Shares
Face Value of
Current Deposit Tk.4101 .56 million
Current Advance Tk.3495.7 I million
Accounting Semi Computerized in Accrual Basis
Audit Firms Howlader, Youns & Co.
“STANDARD BANK LIMITED” at a glance 1999-2002:
|PHd up capital||200.00||200.00||200.00||200.00|
|Loans & Advances||3495.71||1 2365.18||751.78||128.94|
|Non-performing Loans (NPL)||18.32||16.60||0||0|
|NPLs toTotal Credit Outstanding||0.52%||0.70%||0.00%||0.00%|
|Capital Adequacy Ratio||10.07%||11.27%||27.05%|
|Net Interest Income||150.95||93.14||91.86|
|Non Interest Income||82.34||60.93||32.99|
|Earnings per share(Taka)||32.46||15.70||11.64|
|Foreign Exchange Business||6416.82||3673.58||1540.27||143.00|
|Return on Eguity(%)||15.07%||9.5 1%||7.30%||0.95%|
|Ratio of Classified Loan to Total Loans||0.52%||0.78%|
|Nuniber of Branches||14||10||9||4|
|Number of Employees||268||240||230||124|
|02.||Human Resource Department|
|05.||Monitoring & Recovery Department|
|07.||Business Development Department|
|09.||Central Accounts Department|
|10.||Information Technology Department|
|01. Principle Branch||Metropolitan Chamber Building 122-124, Motijheel C/A, Dhaka-I000|
|02. Khatungong Branch||33,Ramjoy Mohajon Lane,Khatungong.Chittagong|
|03. Imamgong Branch||Bellal Market 79,MouloviBnzar.Dhaka-1 100|
|04. Topkhana Branch||Crescent Centre,36,Topkhana Road.Dhaka- 1000|
|05. Chowdhury Hat Branch||Chikandandi.Fateyabad,Hathazari,Chittagong|
|06. Agrabad Branch||Hossain Chamber, 1 05,Agrabad C/A. Chittagong|
|07. Khulna Branch||Chamber Building,5,KDA Avenue,Khulna|
|08. Gulshan Branch||4/A Kamal Ataturk Avenue,Gulshan—2,Dhaka— 1212|
|09. Sylhet Branch||Syl mart Complex,Naya Sarak,East Zinda Bazar,Sylhet|
|10. Munshikhola Branch||DN Road.Shaympur,Munshikhola (Pagla),Dhaka.|
|11. Jubilee Road Branch||Aziz Chanihcr,6,Noor Ahmed Road.Juhlee Road Chitg|
|12. Foreign Exchange Branch||81 ,Motijheel C/A (1St Floor), Dhaka- 1000|
|13. Dhanmondi Branch||House#4,Road# I 6(New),27(Old),Dhanmondi,Dhaka|
|14. Uttara Branch||Uttara Model Town Honse#1 1 3/C,Road#7 Sector#4,Uttara,Dhaka|
|15. Tekerhat Branch||Tekerhat, Madaripur|
Management & Internal Organization:
The management team of the Bank consisting of highly motivated, well educated and skilled executives who have been contributing substantially in the continued growth and progress of the bank. The management is ably supported and assisted by well-motivated and experienced officers.
Business Philosophy of SBL:
The philosophy of SBL is to develop the Bank into an ideal and unique banking institution. The sponsor perception is that SBL should be quite different from other privately owned and managed commercial bank operating in Bangladesh. SBL is to grow as a leader in the industry rather than a follower. The leadership will be in the area of service, constant effort being made to add new dimensions so that clients can get “Additional” in the matter of services to commensurate with the needs and requirement of the country’s growing society and developing economy.
Objectives of SBL:
The motto of the Standard Bank Limited is to explore a new horizon of innovative modern banking creating an automated and computerized environment providing one stop services and prepare itself to face the new challenges of globalization. One of the main objectives of the bank is to be a provider of high quality products and services to attract its potential market. The bank also caters to the needs of its corporate clients a provider a comprehensive range of financial services to national and multinational companies. The growing technological revolution in the bank is not so Distant future, the bank are contemplating to introduce SWIFT, ATM services, Credit Card as well as Electronic & Online banking services to their esteemed clients within the shortest possible time.
The bank management‘s future plan is to turn this bank into a world class bank so that all banking related services could be provided efficiently and effectively. Automation will pay a vital role in this regard. We will bring all the branches under one network so that the customer can bank one account whether he/she likes to operate. ATM services have already been introduced for the purpose.
Corporate clients will be provided banking services at their door steps. This service will help to ease tension of carrying large quantity of money during the salary period.
Phone banking and Internet Banking will inspire them to c—commerce and allow the customer to withdraw and transfer money at any time. More specifically the batik will provide the following services conducive to the demand of the c-age:
• Electronic fund transfer
• Electronic L/C: one stop service.
• Utility bill payment through ATM card
• Clients of SBL ma deposit their monthly installments of Hajj savings account scheme and household durables scheme through ATM
STANDARD BANK LIMITED (Topkhana Road Branch)
This report is covered by the financial, structural, functional and overall performance of Standard Bank Limited. But it is totally written down depending on a branch activity named “Topkhana Road Branch” which is one of the profitable Branches of the SBL. This starts its business transaction in December 12 1999 and now a day total staff member is 24.
Branch Position as on March 31 2004
|Table, Branch Position||Taka|
General Banking Department is one of the rush department of a bank ,the Officers of this department have to perform several kinds of task they are as follow:
• Account opening
• Account close
• Pay Order issue
• Cheaque Book issue
• Telephonic transfer, Demand draft issue
• LBC/OBC Collection
• Clearing House activities
Current Account is an important account by which many parties can get benefit by opening this account. In general, the businesspersons, business corporations open are account for immediate cash or deposit.
Nature of Current Account:
• Any time can en-cash by issuing check
• Any time can deposit money.
• No interest is available on this account.
Types and requirements of Current Account:
There are four types of current account provided h\ the Standard Bank Ltd. to all. They are basically as follows:
It requires: 1 .Name 2. Father’s Name 3. Present & permanent address 4. Date of birth & age 5. TIN no. (If available) 6. Phone no (if available) 7. Photocopy of the Passport (first four pages)! Word Commissioner Certificate/character certificate of the Union Parishad Chairman 8. Birth certificate, 9. Bangladesh Bank Declarations.
Private Business Holder:
It requires: 1. Trade License of the Business 2. All related documents of account conductor mentioned in the above.
It requires: Certificate of incorporation, Articles of Association, Memorandum of Association, Decisions of the Board Meeting, Director’s Message and the necessary information of the account conductors mentioned in the above.
Club/Association/Limited Society/Non-Government/School college:
It requires: 1.Office Employees Description, By-Laws, Government Authorization Letter
(If registered). Certificate of Registration, and Introduction of the Members of the Governing Body or Managing Committee etc.
Process of Current Account:
This account also gives benefit to the account holder. Generally business organization or limited company cannot open this account. Savings Account is opened by those persons/people, who are interested to collect money from his account every now and then as well as want to get interest on deposited amount.
Nature of Savings Account:
No one can collect money from his/her account more than two times per week. Generally week is denoted from Saturday to Sunday.
• Interest is given to this account. But if the given interest of six months is less than Tk. 10 will not he added in the account.
• At least Tk. 1000 has to be kept as balance by the depositor.
• Interest is counted two times meaning after two months after.
• If any body wants to close his account, he must have to closing charge.
• Any body can transfer his account at any time to any branch.
Categories of Savings Account:
Basically savings account has no types. But it can be opened by
· Individual Savings Account
· Joint Savings Account
· Savings Account with Minor.
Requirements of opening a Saving Account:
· Two copies of passport size photo.
· Character certificate by the chairman! commissioner certificate/photocopy of the passport (only first four pages).
· Personal information (if jointly done).
· . Photo of the minor (if opened with minor).
· . Details information of the organization (if needed).
· Signature in the account opening form/card must be same with the signature of the passport.
· Bangladesh Bank Declaration Form
The interest rate of Savings Account is seven percent (7%) annually. But this it is calculated two times per year.
Steps of opening this account:
FIXED DEPOSIT RECEIPT (FDR):
The FDR account is an important account. The interest rate of this account is higher than the other account but it depends on the period of time. The more you hold your money in the bank, the more you get as interest. So many people keep their money as FDR basis in the bank. The SBL also invites a lucrative fixed profit for account holders who are more interested to open this type of account.
Nature of FDR:
There are some information is given below:
• Any Bangladeshi national residing home or abroad may open FDR with SBL.
• FDR may be opened single/joint name for a period of 1, 3,6,12 months and above.
• SBL offers attractive/competitive rate of interest in FDR.
• Interest is given periodically.
• If any account holder wants to receive money from his account without the covering of maturity he must not be paid any interest by the bank. But it is said that if any account cross the three (3) months he must paid on three months interest.
Interest Rate of FDR:
|Period||Interest Rate (%)|
|12 month & above||10.00|
Procedure of opening FDR:
Activities after Maturity:
After crossing the maturity date account is not closed by the bank until and unless the client wants to close it. But the computer program will close it automatically. However, the bank must prepare four vouchers after maturity.
FDR Interest A/C Dr.
FDR A/C Cr.
On FDR l0% the client through bank must pay tax….
FDR A/C Dr.
Source Tax A/C Cr.
SHORT TERM DEPOSIT (STD)
This account is also an important account for many organizations. This account requires a
huge amount. Generally there is no basic difference between the Current Account and the
STD Account. The only main difference is that STD A/C provides interest but Current
A/C does not do it.
Characteristics of STD:
Some features of STD account are given below:
1. Govt., Semi-Govt., Autonomous organization and an individual may open STD Account with SBL.
2. SBL offers attractive/competitive rate of interest in STD Account.
3. After opening these account cheaque is issued.
4. Account holder can withdraw money from his/their account at any time.
5. 7 days notice required withdrawing big amount.
Requirements of this account (STD):
It requires (For Individual): 1.Name 2. Father’s Name 3. Present & permanent address 4. Date of birth & age 5. TIN no. (If available) 6. Phone no (if available) 7. Photocopy 01 the Passport (first four pages)! Word Commissioner Certificate/Character Certificate of the Union Parishad Chairman 9.Have to fill up the Bangladesh Bank Declaration From It requires (For Private Organization): 1. Trade License of the Business 2. All related documents of account conductor mentioned in the above.
It requires (For Limited Company): Certificate of incorporation. Articles of Association, and Memorandum of Association, Decisions of the Board Meeting. Director’s Message and the necessary information of the account conductors mentioned in the above.
It requires (Club and Other Organization): 1.Office Employees Description, By-Laws. Government Authorization Letter (if registered), Certificate of Registration, and Introduction of the Members of the Governing Body or Managing Committee etc.
Interest Rate of STD:
The interest rate of STD account is five percent (5.00%) per year.
Numbers of Account in Topkhana Road Branch
|Types of A/C||Number|
This department is absolutely important for bank. It covers near about fifty percent of profit of a bank. Consequently, all the braches try to provide this service to the clients as much as possible. Basically, these services are for cash transfer.
There are four areas from where remittance comes in general. The names have been given below:
1. Payment Order
2. Demand Draft
3. Telephone Transfer
Payment Order is a real document for paying money from one person to another. There is no risk concerning this matter. Sometimes many people do not want to believe on cheque because account may be out of lowest balance, may be suited by the bank.
Features of P0:
There some features that contain Payment Order. These are discussed in the following:
§ Payment Order is Account Payee only.
§ Purchaser may refund it at any time. He may en-cash or may transfer it to his own account.
§ It may be also en-cased by the client to whom it is issued.
§ Purchaser may purchase it by paying cash or by debiting the exact his account.
§ P0 must he withdrawn from the issuing branch.
Charges of Payment Order (P0):
|Aniount Range Commission )||Tk.|
|Upto 1.00 lac||25.00|
|Tk. 1.0 1ac to Tk. 5.0 lac||60.00|
|Above Tk. 5.0 lac||75.00|
Procedure of P0:
There are some orderly steps must be maintained by the employee before delivering to the P0 purchaser. These steps are-
Maintenance of Daily Payment Order Book:
Every day total P0 must be calculated just to maintain accounts clearly.
Demand Draft is purchased when one person wants to pay money somebody who is living out of this area and bearing an account with another branch in this bank. For instance, a person is living in Dhaka. He wants to give some money another person of Chittagong who is bearing an account with the SBL at Chittagong. But he does not want to pay in cash. In this case he may purchase a DD (A/C payee only) in favor of him.
Nature of DD:
There are some characteristics through which it should be purchased live the clients as per rule. These are:
· Demand Draft must be Account Payee Only.
· Clients may purchase it through cash or through cheque by debiting his account.
· DD must he withdrawn from the responding branch.
· Over writing is strictly prohibited on DD Block.
· DD Advice must be sent to the responding branch. it will not he paid by the hank until the Advice is reached.
|DD postage||Tk. 15|
Steps of making outgoing DD:
Telephone Transfer means that the fund will be transferred over telephone. In this criterion the fund is transferred quickly from one place to another. This service is provided by the bank for a commission basis. Bank earns a lot from this sector.
Characteristics of TT:
The main characteristics of IT have bee given below:
· TT must be sent over telephone or telex.
· In all branches TT can not he sent because it depends on the agreement basis.
· For both outgoing and incoming TT. Advice copy must be sent to the Responding Branch arid Head Office also.
Charges for TT (incoming):
|Tk. Needed to issue|
|Telex charge||At||actual Minimum tk. 50.00|
Inter B ranch Telegraph Advice:
Advice copy consists of three i.e. Original, Duplicate & Triplicate. Originating Branch will Prepare the Advice after sending the TT message to the Responding Branch. The original Cop)’ will have to be sent to the Responding Branch to the IT and the Duplicate Copy of the Advice is to be sent to Head Office and keep the Triplicate copy as their record. The Responding Branch will treat the Original Copy of the T.T. Advice as more
This is the service that is provided by the bank through which clients can be benefited by using this service. It is generally used in collecting money from the different bank. It can be same bank or other bank. In many ways bank can provide this service.
Functions of Clearing and Collection:
There are so many functions that are passed by the clearing and Collection department.
· The entire clearing Cheaques must have to be checked carefully and accurately.
· The entire Inward Clearing Cheques amount must have to be calculated whether the amount is accurate or
· All the things must have to entry in the Clearing and Collection Register respectively.
· Clearing cheque name and the deposit slip name must be the same.
· This department also maintains the Dispatch Activities.
Types of C & C:
Basically there are two types that are generated by this department. These have been discussed in the below:
A. Outward Bills Collection.
B. Inward Bills Collection.
A. Outward Bills Collection:
This process contains another sub-process that is associated with the main activities and through this process all the activities must be done. These are;
A. 1: Outward Clearing Cheque:
In this process parties deposit their amount through another bank’s cheque. It like that an individual hearing an A/C with SBL conies to deposit a cheque of UCBL which is issued for him. But how is it possible? This amount will be credited through clearing house. In general. It takes minimum two working days to pass. If it is dishonored by any cause it must be informed to party.
Outward Collection Cheque:
This collection procedure depends on the out side cheque. For instance, a party A/C is at AHMB of SBL. A cheque of Rajshahi Branch of EBL has been issued in the name of the above party and has been deposited to his A/C by him just to increase amount of money. Now how will he collected? In this case AHMB will send this cheque to their Rajshahi Branch and this branch will collect this money from the EBL through clearing procedure at Rajshahi. If the Rajshahi is failed to collect the amount the cheque must be sent to the AH\IB directly. On the other hand if the can do it they will send an IBCA as LSC (Local Short Credit) to AHMB.
Inward Bills Collection:
It has also some sub-points that are associated with the main topic. That is discussed in the following:
Inward Clearing Cheque:
These are the clearing cheques which have been passed by first Clearing House. It is also this branch’s (AHMB/SBL) cheque that has been deposited to another bank. And it will be debited by the parties A/C. By checking all the Accounts in the computer data base, if it is found that the amount is available then it will be debited otherwise it will be sent to the Local Office again.
Inward collection is two types. They are discussed below:
1. Within the Clearing House.
2. Outside the Clearing House. Out side the Clearing House:
Under this procedure we can take the example of Barisal Branch since it is the matter of out side of Dhaka City. The same procedure must be applied by the Originating Branch mentioned in the above. In this case only some additional vouchers are prepared to cut down sum of money from the parties account as commission for the collection. Here the following accounts will be debit and credit
Actually cash maintenance is vital portion of a bank. Because it is the risky deed one. All the employees should understand the activities of cash department to make self development to be a complete banker. But it is common to all branches that maximum employees are far from the cash function to avoid the risk. No one can go out of the bank until and unless cash is sent to the volt.
4. Receiving cash from the depositors.
4. Payment of cash to the client as demanded.
4. Checking all areas of deposit slip whether it is clearly written or not (name. account no. , amount).
4. Verifying the payment cheque when to pay the money to the clients whether the information is available or not like date, amount, account number etc.
.1. All the received and payment money must he written down in the receipt & payment register along with account number.
4. Cash register must be maintained by the Cash Officer.
4. Maintenance of daily cash balance.
4. Prepare ion of monthly cash balance statement.
Cash Reception Activities:
There are some activities to be performed step by step by the Assistant Officer (cash).
This procedure has been given below: