OVERVIEW OF EXIM BANK LIMITED

(Source: www.eximbankbd.com)

HISTORY
EXIM Bank Limited was established in 1999 under the leadership of Late Mr. Shahjahan Kabir, founder chairman who had a long dream of floating a commercial bank which would contribute to the socio-economic development of our country. He had a long experience as a good banker. A group of highly qualified and successful entrepreneurs joined their hands with the founder chairman to materialize his dream. In deed, all of them proved themselves in their respective business as most successful star with their endeavor, intelligence, hard working and talent entrepreneurship. Among them, Mr. Nazrul Islam Mazumder became the honorable chairman after the demise of the honorable founder Chairman.

This bank starts functioning from 3rd August, 1999 with Mr. Alamgir Kabir, FCA as the advisor and Mr. Mohammad Lakiotullah as the Managing Director. Both of them have long experience in the financial sector of our country. By their pragmatic decision and management directives in the operational activities, this bank has earned a secured and distinctive position in the banking industry in terms of performance, growth, and excellent management. The authorized capital and paid up capital of the bank are Tk. 1000.00 million & Tk. 313.87 million respectively. The bank has migrated all of its conventional banking operation into Shariah based Islami banking since July 2004.

CORPORATE CULTURE
This bank is one of the most disciplined Banks with a distinctive corporate culture. Here we believe in shared meaning, shared understanding and shared sense making. Our people can see and understand events, activities, objects and situation in a distinctive way. They mould their manners and etiquette, character individually to suit the purpose of the Bank and the needs of the customers who are of paramount importance to us. The

people in the Bank see themselves as a tight knit team/family that believes in working together for growth. The corporate culture we belong has not been imposed; it has rather been achieved through our corporate conduct.

Corporate Mission of EXIM Bank

The mission of Exim bank are stated in below_ To provide excellent quality Customer service. To maintain Corporate and business ethics. To become a trusted repository of customers' money and their financial advisor. To make our stock superior and rewarding to the customers/share holders. To display team spirit and professionalism. To provide high quality financial services in export and import trade.

Objectives of the study

The specific of the study may be pointed out as follows_ To acquire knowledge of practical operations and the way of functioning of the bank. To have knowledge of the banking operation performed and services offer by the bank. To get idea about the procedure of general banking operations. To show the trends of the key financial indicators. To examine the potentials of feature growth of the bank. To gain an over all idea regarding the functional as well as the financial performance of the bank.

Methodology of the study

We have collected some primary and secondary data from different sources. The sources are given below: Primary data are collected though_ Oral interview of the responsible officer Conducting interview both customer and staffs of the branch. Secondary data collection from_ Annual Reports From the website http://www.eximbankbd.com Companies other published information. Research report relating to the bank. Bangladesh bank report.

Limitation of the study

At first I want to say that, most of the cases I have to use previous data for the evaluation and analysis, since data about the performance of the bankof the year 2010 are not available. The study of such a short course of time is not free from limitation. So time limation is the main point of limitation. The data relevant for the analysis report writing sometimes could not be collected due to excessive year-ending workload at the branch. It is too much difficult to comment and suggest based on only the annual report and information collected from written documents.

About general banking

Banking operation carried out by EXIM bank
The General Banking department does the most important and basic work of the banks. All other departments are linked with this department. It also played a vital role in deposit mobilization of the branch. EXIM Bank provides different types of accounts and special types of saving scheme under general banking. For proper functioning and excellent customer service this department is divided into various sections namely as follows: 1. Deposit Section 2. Account opening section 3. Cash section 4. Bills and Clearing Section 5. Remittance section 6. Accounts Section 7. FDR Section

1. Deposit section
A bank is essentially an intermediary of short-term funds. It can carried out extensive lending operation only when it can effectively channels the savings of community. A good banker is one who effectively mobilizes the savings of the community as well as use of saving by making it available to productive and priority sector of the economy thereby fostering the growth. Therefore deposit is the blood of banking system. Thats why deposit collection is the main function of bank.

Accepting deposits
The deposits that are accepted by EXIM bank like other banks may classified into: Demand deposits Time deposits

Demand deposits Deposit that can be withdrawn without any prior notice. EXIM bank accepts demand deposits through the opening of_ Current Account Saving account Call deposits from the fellow bankers.

Time deposits A deposit which is payable at a fixed date after a period with prior notice is a time deposit. EXIM bank accepts time deposits through fixed deposit receipt, short-term deposit, bearer certificate deposit etc. While accepting these deposits, a contract is executed between the banker and the customer. The contract will be valid only when both the parties are competent to enter into the contract. As accounts initiates the fundamental relationship and since the banker has to deal with various kind of persons with various legal status. EXIM bank officials remain very much careful about the competency of the customers.

ACCOUNTS OPENING SECTION

This section deals with opening of different types of accounts. It is also deals with issuing of checkbooks and different accounts openers. A customer can open different types of accounts through this department such as: 1. 2. 3. 4. 5. 6. 7. Current Deposit Saving Deposit Short Term Deposit Term Deposit Savings Scheme . Education Saving Scheme Foreign currency Account

CURRENT DEPOSIT The main objective of this account is to provide convenience to the customers in their savings. This account allows the customer to deposit his/her surplus money as and when

available and receive lucrative profit on the same. The customer can deposit any sum desired at any time of the operational hours in this account.

SAVINGS DEPOSIT This deposit is basically meant for small-scale savers. There is restriction on withdrawals in a month. Heavy withdrawals are permitted only against prior notice. Interest is paid yearly on these types of accounts. These accounts can be Individual Joint Partnership Non-profit making organizations (associations, clubs, trust etc.)

SHORT TERM DEPOSIT It is known as time liabilities or form deposits. These are deposits, which are made with bank for a fixed period specified in advance. The bank need not maintain cash reserves against these deposits and therefore, the bank offer higher rate of interest on such deposits.

TERM DEPOSIT It is also time based deposit scheme. Under this the interest are paid 9.75%, 13.25%, 13.25%, 13.00% on the basis of monthly fixed deposit. In this scheme time may vary which are given below One Month Three Months Six Months Twelve Months Twenty Four Months Thirty Six Months

SAVINGS SCHEME EXIM bank offer following saving scheme for their customer___

Monthly Saving Scheme (DPS) Monthly Income Scheme Multiplus Saving Scheme Super Saving Scheme

Monthly Saving Scheme The first & foremost objective of this scheme is to encourage people to build up a habit of savings. Under this scheme, one can deposit monthly a fixed amount of money regularly and will receive a substantial amount with handsome benefit after maturity of reasonable period /tenure.

Monthly Income Scheme It is an alluring and commonly accepted scheme of EXIM Bank as an investment of steady monthly return. Under this scheme, the depositor is allowed to deposit at least Tk.1,00,000/or its multiple amount for 3 years and in return he/she will receive profit on monthly basis at an attractive rate. This scheme mainly has been drawn up as well as introduced for the benefit of middle-income group, particularly retired personal.

Multiplus Savings Scheme Under this scheme, the depositor is allowed to deposit at least Tk.5, 000/or its multiple amount for 10 (Ten) years and at the maturity of the account, it will be arrived at more than triple of his/her deposited amount. Moreover, the depositors may avail themselves of investment facility under abovementioned schemes, by meeting easy terms and condition in regard to scheme(s), as the case may be.

Super Savings Scheme Super Savings Scheme is offered for all classes of people, specially for the middle class, where the depositor is allowed to deposit at least Tk.5,000/or its multiple amount for 6 years and at the maturity of the account, deposited amount will be stood at more than double.

Education Savings- For higher education

With a view to assisting the customer for higher education, EXIM Bank has introduced this scheme with convenient terms & conditions. The most gratifying experience for parents is proper education of their children. Educational expense is rapidly increasing and therefore appropriate needs to be done by all parents. EXIM Bank offers you Education Savings Scheme to assist you financial planning well ahead in time for your childrens higher education. One may deposit Tk.25000 or multiples thereof at a time. The instrument shell be issued for 7 years, 10 years, 15 years, 20 years term. The deposit is payable at maturity with either in lump sum or on monthly basis as education allowance for 6 (six) years starting after the completion of respective term Normally, no withdrawal will be allowed before maturity.

Foreign Currency Deposit Account

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

REQUIREMENT OF OPENING AN ACCOUNT

There are some requirements that have to be completed for opening an account. Requirements for the different types of accounts opening are discussed below 1. 2. 3. INDIVIDUAL / JOINT ACCOUNT Introduction of the account Two photographs of the signatory duly attested by the introducer One copy photograph of nominee along with singular duly attested by the account holder 4. 5. 1. Nominee declaration form duly signed by the nominee & account holder Identification (Copy of Passport)/Chairman Certificate/National ID/Copy T&T bill/Employee certificate/Student ID etc PARTNERSHIP ACCOUNT Introduction of the account

2. 3.

Two photograph of the signatory duly attested by the introducer One copy photograph of nominee along with singular duly attested by the account holder

4.

Partnership deed duly sign by all partners to open & operate the account (Signature should be similar as stated in Partnership Deed)

5.

Partnership deed duly certified copy by Notary Public (Deed should be written in Bond of Tk.500, if the capital is Tk.25,000, but if the capital exceed of Tk.25,000 bond of Tk.1,000

6. 7. 8.
9.

Registration (if any) Rubber stamp Updated Trade License Identification of partners (Copy of Passport/Chairman Certificate/National ID Card etc.)

1. 2. 3.

PROPRIETORSHIP ACCOUNT Introduction of the account Two photograph of the signatory (es) duly attested by the introducer One copy photograph of nominee along with singular duly attested by the account holder

4. 5. 6. 7. 1. 2. 3. 4.

Updated Trade License Rubber stamp TIN Certificate (if any) Identification of properties (Copy of Passport/Chairman Certificate/National ID Card etc.) LIMITED COMPANY Introduction of the account. Two photograph of the signatory (es) duly attested by the introducer Valid copy of the trade License Board Resolution for opening account & operation of the same duly certified by the chairman / Managing Director

5. 6.

Certificate of Incorporation. Certificate of commencement (In case of Public Limited Company)

7.

True copy of the Memorandum and Article of Association of the companies. Duly attested by the Chairman of Managing Director.

8. 9.

List of Directors along with designation and specimen signature. Latest certified copy of FormX11 (to be certified by the registrar of Joint stock companies) (in case of directorship change)

10. 11.

Rubber stamp (seal with designation of each person) Certificate of registration (in case of Insurance companyobtained from department of Insurance from the peoples Republic of Bangladesh)

12.

Identification of directors (Copy of Passport/Chairman Certificate/National ID Card etc.)

1. 2. 3. 4. 5. 6. 7. 8. 9.

CLUB / SOCIETIES ACCOUNT Introduction of account. Two photograph of the signatories duly attested by the introducer. Board Resolution for opening account [Duly certified by president / Secretary] List of Existing Managing Committee. Registration [if any] Rubber stamp By Laws Permission Letter from Bureau of N.G.O [in case of NGO account] Government Account

Closing of an account
The closing of an account may happen, if: The customer is desirous to close the account. The bank finds that the account is inoperative for a long period of time. The court of EXIM bank issues garnishee order.

A customer may close his/her account any time by submitting an application to the related branch. The customer should be asked to draw the final check for the amount standing to the credit of his/her account less the amount of closing and other incidental charge and surrender the unused check leaves. The amount should be debited for the

account closing charge etc. The fee for closing of an account is tk.25 for SB account and tk.50 for CD and STD account.

CASH SECTION
The cash section of EXIM bank deals with all types of negotiable instrument, cash and other instruments treated sensitive section of the bank. It include the vault that is used as the beyond this time, the excess cash is then transferred to Bangladesh bank. Cash section performs the functions of cash packing, after the banking hour cash is packed according the denomination. Notes are counted and packed in bundles and stamp with initial. Before starting the banking hour all tellers give requisition of money though Teller cash proof sheet. The head teller writes the number of the packet denomination wise in Reverse Sheet at the end of the day; all the notes remained are recorded in the sheet.

Bills and clearing section

The schedule banks clear the cheques drawn upon one another through the clearinghouse. This an arrangement by the central bank where everyday the representative of the member banks gather to clear cheques. The place where they meet and settle their dues is called the clearinghouse. The clearing house sits for two times a working day. The members submit the claimable cheque in the respective desks of the banks and viceversa. Consequently the debit and credit entries are given. At the end debit summation and the credit summation are calculated. Then the banks clear the balances through the cheque of Bangladesh Bank. The dishonored cheques are sorted and returned with return memo. The main function of this section is to collect instruments on behalf of the customers through Bangladesh Bank clearinghouse, outward bills for collection, and inward bills for collection. Upon the receipts of the instruments this section examines the following things: Whether the paying bank is within the Dhaka city Whether the paying bank is outside the Dhaka city.

Whether the paying bank is their own branch.

Out ward bills for collection

Collections of bills, which are beyond the clearing range and collected through OBC mechanism.

In ward bills for collection

Collection of bills, which EXIM Bank does as an agent is called collection through IBC mechanism.

Dishonored cheque
If the cheque is dishonored EXIM Bank sends a memorandum to the customer starting the reason in the following way Refer to drawer Not arranged for Effects not cleared. May present again. Exceed arrangements. Full cover not received. Payment stopped by drawer Payees endorsement irregular. Payees endorsement irregular, require banks confirmation. Drawers signature differs/ required. Alteration in date/figures/words, require drawers full signature. Cheque is post dated/differ. Crossed cheque must be presented through a bank. Clearing stamp require/requires cancellation. Addition to bank discharge should be authenticated. Cheque crossed account payee only. Collecting bank discharge out of date/multilated. Amount in words and figures irregular/required. If the cheue is dishonored due to insufficiency of fund of EXIM Bank charges tk.25 as penalty.

Rules for passing cheque

In order to enable the branches to facilitate their day to day transsections smoothly/efficiently/accurately, the following schedules of power for passing of cheque/instrument signature of vouchers shall come into the force with immediate effect.

An authorized officer shall pass cheque for less than tk.10000 singly after proper supervision in computer print out. Cheque for tk.10000 and above but below tk.50000 shall be passed jointly by any two authorized officer after proper supervision of computer print out by any officer. He will however also ensure that no factitious credit in the amount has been posted on the day by referring to credit vouchers of the day.

Cheque for tk.50,000 and above shall be passed under joint signatures of two officers, one of whom must be manager of the branch. The procedures regarding supervision of cheque as at above must however be followed.

All suspense A/c (debit) vouchers, sundry deposit vouchers, credit A/C debit vouchers, expenditure A/C vouchers must be singed by the incumbent incharge of the branch with any other authorized officer. As at the close of business of the day all transaction shall be checked by referring to computer print out and relative cheque vouchers.

Apart from the above it will also be ensure that the amount of debit and credit totaling to current A/C, savings, STD& term deposit corresponds with the total of cash receipts/payments, transfer clearing (both outward &inward).

Local remittance section

The offers various kinds of remittance facilities all over the country through it branch network. Telegraph transfer, travelers cheque and draft and cheque can do remittance. There are two steps of remittance as are: Inward remittance:- when one bank sends this T.T, M.T, T.C or cheque to another bank within the country it will be called inward remittance.

Outward remittance:- when a bank got this T.T,M.T, T.C and cheque from any bank outside the country then it will be called foreign remittance.

Types of remittance:
Between bank and non-bank customer Between bank in the same country Between bank in different countries Between bank and central bank in the same country Between central bank of different customers.

The main instruments used by EXIM bank for remittance of funds are:Payment order (PO) Demand draft (DD) Telegraphic transfer (TT)

Payment order (PO)

A pay order is a written order, issued by a branch of a bank, to pay a certain sum of money to a specified person or a bank. It may be said to be a bankers cheque as it is issued by a bank drawn upon and payable by itself. EXIM bank charges different amount of commission on the basis of payment order amount, as follows:Payment Order Charge Total amount of PO Up to Tk. 10,000 Tk.10, 001 to Tk.100, 000 Tk. 100,001 and above VAT Tk.4 Tk. 9 Tk.18 Commission Tk.25 Tk. 60 Tk. 120

Source: annual report of EXIM bank.

Demand draft (DD)

A demand draft is a written order of one branch upon another branch of the same bank, to pay a certain some of money to or to the order of a specified person. Drafts are not issued payable to bearer. In practice drafts are not to be drawn between branches within the same city. In EXIM bank commission for DD is 0.15% of the principal amount.

Telegraphic transfer (TT)

Telegraphic Transfer may be affected at the written request of any person and against value received from him. A written application on the banks prescribed form duly signed by the purchaser should be obtained. If the application for issue of telegraphic transfer contains instruction to debit the account of the customer, his signature should be verified. It is however, preferable to obtain a confirmation cheque from the customer. Charge for TT is tk.0.15% of the principal amount and the additional charge for telex.

Accounts section
This is a very much crucial department for each branch of a commercial bank. Records of all the transactions of every department are kept here as well with other respective branches. Accounting department verifies all financial amounts and contents of transactions. If any discrepancy arises regarding any transaction this department report to the concerned department

Tasks of account section: Accounts department plays a vital role in commercial banking. In private banking sector accounts department of EXIM Bank Bangladesh Ltd. Performs its tasks properly. The activities of accounts section are as follows: Record all transaction in the cash book. Record all transaction in the general and subsidiary ledger. Prepare daily fund function, Weekly position, Periodic statement of affairs etc.

Prepare necessary statement for reporting purpose. Pay all expenditure on behalf of the branch. Make salary statement and pay salary. Branch to branch fund remittance and support for accounting treatment. Budgeting for branch. Make charges for different types.

Findings of the study

Although the profit earning condition is satisfactory, the customer service condition of the bank is not yet top class. The bank is not still technological updated. There are no online banking facilities; the bank should have its own data communication facilities for better customer service and security. The account opening procedure for various kinds of clients should be made easier. Efficient work force along with proper division of work is vital for the success of any bank, EXIM bank has the scope to consider these factors to enhance sustain it growth. Most of the people in our country dont have proper knowledge of BAIM- policies. They some time think all are same as traditional banking expect change in the name. There is scope to introduce the most modern services like- ATM, Credit card, Debit card etc. Since the work is done mostly manually, the investment section takes long time to process loans. Foreign exchange department could provide better service through computerization of all its operations. The cash counter and the whole