National Bank Essay

A research program is very important & essential for acquiring experience through learning and spreading the backcloth of Knowledge. I agree done my research program in national swear limit, abroad Exchange Branch. This research tarradiddle is aimed at providing a nationwide picture to the areas of remote Exchange operation of issue Bank Limited. The composition has been divided into twelve parts. These are- Introduction, Brief History of Banking Sector of Bangladesh, Corporate review of NBL, Foreign Exchange, Documents Used in Foreign Exchange occupancy, Letter of Credit (L/C), Import, Export, Foreign Remittance, Findings and Analysis, References. National Bank Limited is one of the largest commercial Bank of Bangladesh. The main verifiable of the Bank is to house all of entrusting services at the doorsteps of the tribe. The Bank also participates in versatile social and development programs and takes part in implementation of various policies and promises made by t he Government.National Bank Limited plays a pioneering role in handling foreign workmanship and foreign give-and-take transactions. With wide profits of branches at home and a large number of correspondent argots worldwide, it is handling the largest volume of export-import credit line including homebound remittances. For this reason, Foreign Exchange of the Bank is very a lot(prenominal) essential. But now a days canting companying vault of heaven of Bangladesh is suffering the disease of default culture which is the consequence or result of bad surgical process of most banks. There are three types of modes of foreign exchange market, which are- Export Financing, Import Financing and Foreign Remittance.Foreign Exchange Branch does these foreign exchange activities vastly. In this report, I mention the overall operating procedure of foreign exchange transaction of National Bank Limited. I also mention the findings of my report and describe the exhortation to overcome the limitation. I have taken all the reasonable care to ensure the accuracy and quality to make the report standard. And I believe that it has included all the necessary information to be relevant.INTRODUCTIOINORIGIN OF THE REPORTAs a mandatory part the BBA Program, all the students of the faculty ofBusiness Studies, Premier University, Chittagong have to undergo a three month recollective research program with an objective of gaining practical knowledge ab give away current worry world. After this research program each and every students have to submit a research report mentioning their activities during the research program. Ive started my research at the National Bank Limited, Foreign Exchange Branch. At the end of the research program I am submitting my research report focusing on the contribution of Foreign Exchange operation to the overall performance of bank especially on profitability perspective under the supervision of Tasnim Uddin Chowdhury, Lecturer, Department of Finance , in Premier University, Chittagong.OBJECTIVES OF THE guinea pigThe general objective of the study is to gather practical knowledge regarding banking system of rules and operation. The research gives us a chance to relate the four year long theoretical learning of BBA Program with the reserch experience. This consists the followingTo get an overall idea slightly the Foreign exchange Business of National Bank Limited. To apply theoretical knowledge in the practical field.To describe the organizational structure, management, background, functions and objectives of the bank and its contribution to the national economy. To achieve overall understanding of National Bank Limited.To analyze the financing systems of the bank to find out any contributing field. To examine the profitability and productivity of the bank.To acquire knowledge about the everyday banking operation of National Bank Limited.To evaluate the effect of world recession on foreign exchange income of NBL, Foreign Exch ange Branch.To understand the real management situation and try to recommend for improving animated problems.SCOPE OF THE STUDYThis study raises those scopes of knowing are the following History and performance of National Bank Limited.Terms used in foreign exchange operationsForeign exchange operations of National Bank LimitedLiterature review.Total concept of Foreign Exchange Operation.methodological analysis OF THE STUDYThe report is prepared on the basic of foreign Exchange of National Bank Limited. To conduct the overall study, at come I explored the sources of primalval and Secondary information and entropy. Different files of the department and statement prepared by FED helped me to prepare this report. To present numerical data, I used the Annual address of 2008 and monthly statement of January to October 2009 of National Bank Limited, Foreign Exchange Branch. For preparing this report I have used some graphical representation to find out different types of analytica l and interpretation.SOURCES OF DATAAs mentioned earlier, mainly primary and secondary data has been used. Some eras the customers gave some important information regarding the services of the Bank principal(a) DATAOfficial records of National Bank Limited (NBL)..Expert opinion.SECONDARY DATAMonthly Statement of NBL.Annual Report of NBL.Official Files.Selected books.Other manual of arms information.Websites.Various publications on the Bangladesh Bank.Newspaper reports in this concern.DATA ANALYSIS AND INTERPRETATIONBoth three-figure and qualitative analysis will be performed on the findings. The quantitative analysis will be done on the trend of export- import, growth pattern of export-import, pre and post facilities provided for easing the export-import operations. Qualitative analyses will be based on the macroeconomic variables and foreign exchange policy provided by Bangladesh bank, the central bank of Bangladesh. Different statistical tools will be used for the analysis of th e findings.LIMITATIONS OF THE STUDYTo provide current information and to make the report read-worthy, support from various sources is essential. In spite of having my wholehearted effort, I could not collect some information unavoidable at the time of the study. So this study is not free from the following limitation Due to unavailability of latest annual report (Annual report 2009), I have to prepare the report on the basis of annual report 2008. As a result, analysis, presentation of data may not show the existing position/present condition of National Bank Limited. For the whole research I had only 90 long time, out of which I get 61 days because of late commencement of research program, which were totally insufficient. So I faced time shortage extremely. Lack of previous experience to prepare this type of report and it is totally clean to me as an intern.Foreign exchange division follows Uniform Customs and Practice for Documentary Credits (UCPDC), but within this short peri od, I was totally stunned to understand. Learning all the banking functions within just two months was really difficult. Sometimes the officers of National Bank Limited were very busy. For this reason the in the flesh(predicate) did not co-operate me. National Bank Limited did not give me any kind of monetary support for this research program Most of the working days in NBL, I have to work in cash department to help in IPO subscription collection, so I get limited time work in other departments to have practical knowledge Another limitation ofthis report is Banks policy of not disclosing some data and information for obvious reason, which could be very much helpful.BRIEF HITORY OF BANKING SECTOR OF BDEVOLUTION OF THE WORD BANKThe word bank originated from Italian word Banca. Banca bureau long tool. In ancient time Italian Jews merchant used to do business of lending funds by sitting on the tools. It is assume that the word bank derived from the word Banca. To meet the expense of war of 1171 one type credit certificate was launched in Italy at an interest rate of 5% it was called as Monte in Italian language and Bank in German language then German language was widely used in Italy. As a result the word Bank gradually changed to the word Banca from which the word Bank originated.THE EMERGENCE OF MODERN BANKINGThe linguistics and etymologists suggests an interesting story about banking origins. Both the old French word Banque and the Italian word Banca were used centuries ago to mean a bench or moneychangers table. This describes quite well(p) what historians have observed concerning the first bankers, who lived more than 2000 years ago. They were money changers, situated usually at table or in a small shop in the commercial district, aiding travelers who came to town by exchanging foreign coins for local money or discounting commercial notes for a fee in ensnare to supply merchants with working capital. The first bankers probably used their own capital to fund their activities, but it was not long before the idea of attracting deposit and securing temporary loans from wealthy customers became a source of bank funding.Loans were then made to merchants shippers and landowners at rates of interests low as 6 percent per annum to as high as 48 percent a month for the riskiest ventures. Most of the early bank was Greek in origin. The banking industry gradually spread outward from the classical civilizations of Greece and Rome into Federal and western Europe. The early bank in Europe was places for safe keeping of valuable items (such as gold andsilver bullion) as people came to fear sacking of their asset due to war, theft, or expropriation by authorities. When colonies were established in North and South America, old world banking practice were transferred .DEVELOPMENT OF BANKING IN BANGLADESHSince early British rule, the history of banking in Bangladesh territory shows that the traditional pile-networks developed before the banks inv aded rural areas. And the banking services have slowly flourished in Bangladesh territory. Even today, in many places, moneylenders provide credit services. Small shopkeepers and businessman use informal credit at high interest rate. Traditional mahjongs money lending business gradually declined due to expansion of bank and the micro credit programs of NGOs, cooperative banks and government agencies.PUBLIC SECTOR BANKSDuring the liberation war in 1971, the economic, political, and social system including the banking system was severally damaged. At that time, all big and medium financial institutions except two small banks had their head office in the West Pakistan. The non-beagle owners and managers of the financial establishments that operated in East Pakistan had abandoned them. After independence in 1971, the new government had to take over management and ownership of all such institutions. The banks nationalization Order 1972 was issued to nationalize banks and financial inst itutions (except those incorporated abroad) in order to control chaos in the field of ownership, party bureaucracy, the intelligentsia, and pressure group. By several orders the government of Peoples Republic of Bangladesh created- Six nationalized commercial banks (NCBs)1. Sonali Bank2. Agrani Bank3. Janata Bank4. Rupali Bank5. Pubali Bank6. Uttra BankOne industrial bank (BSB)One agricultural bank (BKB)One industrial development financial institution (BSRS) The bank and financial institutions which originated during the Pakistan period and were merged, and renamed and functioning after independence of Bangladesh. In the year 1983, the government allowed hugger-mugger sector to participate in the banking business. The Publi Bank and the Uttara Bank were denationalized in 1985, due to non profitability. This action reduced the number of NCBs to four. Such restructuring of public sector banks was in order to play their role in industry, agriculture, export, self employment etc.PRIVAT E COMMERCIAL BANKSTaking advantage of the liberalization policy of the government regarding participation of close sector in the banking business, a number of head-to-head banks were established in and after 1983. With the emergence of head-to-head banks in Bangladesh, a competitive situation in the sector has been created. Now there are 48 commercial banks in Bangladesh which are enlisted with Bangladesh Bank, among them four (4) are NCBs, five (5) are specialized banks, twenty club (29) are buck private commercial banks and ten (10) are foreign commercial banks. The emergence of private banks has added a new dimension to the banking system in Bangladesh. The private commercial banks show a steady growth in terms of number of branches, deposit and advances.CORPORATE REVIEW OF NATIONAL BANKHistory of National Bank LimitedNational Bank Limited has its prosperous past, glorious present, prospective future and under processing projects and activities. Established as the first priva te sector Bank fully owned by Bangladeshi entrepreneurs, NBL has been flourishing as the largest private sector bank with the passage of time after veneering many stress and strain. The member of the board of directors is creative businessman and international economist. For rendering all advanced(a)services, NBL, as a financial institution alter 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 much more to NBL. Keeping the target in mind NBL has taken preparation branches by the wear 2000-2001. The emergence of National Bank Limited in the private sector is an important event in the banking area of Bangladesh. When the national was in the grip of severe recession, Govt. took the farsighted decision to allow in the private sector to revive the economy of the country.Several dynamic entrepreneurs came forward for establishing a bank with a mott o to revitalize the economy of the country. National Bank Limited was innate(p) as the first hundred percent Bangladesh owned Bank in the private sector. From the very inception it is the firm determination of National Bank Limited to play a vital role in the national economy. We are determined to bring back the long forgotten taste of banking services and flavors. We compulsion to serve each one promptly and with a sense of dedication and dignity. The President of the Peoples 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 functioning on March 23, 1983. The 2nd Branch was opened on eleventh May 1983 at Khatungonj, Chittagong. Today we have total 103 Branches all over Bangladesh. A representative office was established in Yangon, Myanmar in October, 1996 by our bank and obtained permission from the government of Bangladesh to handle border trade with Myanmar .oppo rtunities is being explored for further business avenues there.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 muster arrangement with well conversant money transfer service agency Western union. It has 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 bas and social commitment admitting this unbowed NBL is going on with its diversified banking activities NBL introduced monthly Savings Scheme, special Deposit Scheme, and Consumers. Credit Scheme and savings Insurance scheme etc. To combine the people of lower and middle income group. A team of highly qualified and experiment professional headed by the managing Director of thebank who has vast banking experience operates bank and at the top three is an efficient Bo ard of Directors for making policies.Vision of National Bank LimitedEstablishing as a top grade efficient bank through best application of modern information technology and business activities, offering high standard client services and Proper coordination of foreign trade business in the core of their vision.Mission of national bank LimitedWith a view to achieving commercial objective of the bank, their sincere and all out efforts deterrent put unabated. Respected client and shareholders are attracted to us for our transparency, accountability, social communities, and high quality of clientele services.Objective of national Bank LimitedBring modern banking facilities to the doorsteps of general public through diversification of services, thereby arousing saving propensity among the people. Foreign a cordial, deep rooted and farm banker customer relationship by dispensing prompt and modify clientele services. Taking part in the development of the national economy through productiv e development of the banks 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 high of banking with NBL. Responding to the need of the time by participating in the syndicated large loan financing with like-minded banks of the country, thereby expanding the area of enthronement Elevating the image of the bank at home and abroad by sustained expansion of its activities.Strategies of National Bank LimitedTo manage and operate the bank in the most efficient mode to enhance financial performance and to control cost of fund. To strive for customer satisfaction through quality control and delivery of timely services. To identify customer credit and other banking needs and monitor their perception towards our performance in meeting those and update requirement. To review and update policies procedures and practices to enhanc e the ability to extend stop services to customer. To train and develop all employs and provide them adequate resources so that customer needs can responsibility addressed. To promote organizational effectiveness by openly communicating company plans, policies, practices and procedures to all employers in a timely fashion To naturalise a working environment that fosters positive motivation for improved performance To diversify portfolio both in the retail and whole sale market. To increase direct contact with customer in order o cultivate a closer relationship Business GoalTo patronize, sponsor and encouraged games and sports, entertainment and other socio-economic activities alongside providing the best services to the client.The Future thrust entire duplex on-line BankingIntroducing more innovative products and services Opening new branchesExpansion of business network at home and abroad SMS BankingIntroduction of new liability / Asset productsCorporate CultureEmployees of NBL s hare certain common values, which helps to create a NBL culture.The client comes firstSearch for professional excellence bleakness to new ideas& new methods to encourage creativity Quick decision makingFlexibility and prompt responseA sense of professional ethics exploitation and Development of NBLThe 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 banking sector in the country faced different problems thought the year. Even through the board and management never stopped its effort to maximize wealth, which is reflected by 143.97percent profit growth in 2007, highest ever in the last 15 years. The bank earned the 676.45 core revenue in 2007 as interest, income from investment and commission & exchange earning, which who Tk. 53069 corer in the provision year. As a result the total operating profit rode to Tk. 221.51 corer in 2007 from Tk.114.68 corer in the previous year.Branches of NBLNBL, which was started at Dilkusha Branch on March 23rd, 1983, was the first major commercial Bank. In Bangladesh operating throughout the country as well as the age of the bank is only 25 years .During this period it has established total 112 branches over the country and made smooth network inside the country as well as thought the world. The number of branches as well as territory wise is mentioned in the table.