Prime Bank's Credit Card - a comparative study on Prime Bank Limited & Other Banks and Financial Institutions of Bangladesh
: its impact on organizational growth
specially on Prime Bank Limited.
Prepared For: M Sirajul Islam Lecturer Institute of Business Studies Darul Ihsan University
Prepared by: Arkanul Haque Roll #8031, BBA. 8th Batch Major in Finance Submission Date: 27 January 2004 Institute of Business Studies Darul Ihsan University
Letter of Transmittal
January , 2004 M Sirajul Islam Lecturer Institute of Business Studies Darul Ihsan University. Subject: Submission of Internship Report. Dear Sir, It is a pleasure to me to submit this internship report on " Prime Bank's Credit Card - a comparative study on Prime Bank Limited & Other Banks and Financial Institutions of Bangladesh: its ^impact on organizational growth specially on Prime Bank Limited. " , as a fulfillment of the requirement of BBA Program. I was assigned to work at Prime Bank Limited for 3(three months). This report is based on my acquired knowledge, experience and skill during my stay at this Bank. This is for your kind perusal and consideration.
I, Arkanul Haque, hereby declare that the report of internship entitled & "Prime Bank's Credit Card - a comparative study on Prime Bank Limited & Other Banks and Financial Institutions of Bangladesh: Its impact on organizational growth specially on Prime Bank Limited" is prepared & after the completion of the internship in Card Division of Prime Bank Limited and a comprehensive study of the existing activities and its implementation. I also declare that the report is prepared for academic purpose not for any award on degree.
At first I have to express my gratitude and thanks to Almighty Allah who gave me the opportunity to complete the BBA-Degree Courses. Now, I would like to give my thanks to Mr. Rafiqul Islam, Lecturer, Open University (Ex. Lecturer, IBS, DIU) so that without his close guidance and valuable advice it would be too much difficult to go through the study. I wish to extend my thanks to the Human Resources Department of PBL who has assigned me with the topic. Finally I would like to give my thanks to all staffs and officers of Dhanmondi Branch, PBL, for their helpful cooperation. ;
I really owe to them. Shamima Sharmin BBA (7th Batch) Roll No. 7006 Institute of Business Studies Darul Ihsan University
1.1 Work Study :The management of Prime Bank Ltd. and Mr. Rafiqul Islam Lecturer, IBS, Darul Ihsan University, Dhaka, Bangladesh has assigned internship report on "Marketing of Financial Products in Prime Bank Limited with comparison of other banks" to me. In this regard an organization attachment at Dhanmondi Branch of Prime Bank Limited has been given to me a lot of time. Within that period, I collected necessary data for the report. 1.2 Background of the Study : Prime Bank Ltd. one of the most successful Banking organization in the country. For the last few years the performance of the company was really goods. Prime Bank is the premier bank for consumers and small business with a commanding market presence in consumer credit, hire purchases and lease finance. As a Banking organization Prime Bank has several deposit schemes (MBDS, FDR, CCA, SA etc) and financial product (master card, loan from different purposes etc) As a business student, I have worked with Prime Bank Ltd. for my internship purpose I carried out a survey and my topic was "Marketing of Financial Products in Prime Bank Limited with comparison of other banks". I filtered, stored reshuffled and analyzed the collected information and interpreted all the analysis to bring about my hypothesis to be right. In my project I gave my attention to find out the comparative analysis among Prime's different deposit schemes and also to detect the strategy for creating strong market position.
.3 Objective of the Study : The main objective of the study is to know the marketing strategy o financial products of Prime Bank Limited through different aspects of the banking sector and to evaluate how well bank is doing in its Deposit Scheme. The specific objective of the study are given bellow: i) To find out the satisfaction level of the clients with the financial products and deposit schemes provided by the Prime Bank Ltd. 1. ii) Market feasibility of different schemes and financial products offered by the Prime Bank Ltd. iv) To find out any correction or addition/deduction required in the rules and procedures of the schemes and financial products offered by the Prime Bank Ltd. Analyzing the clients' opinion about the schemes and financial products offered by the Prime Bank Ltd. v) vi) To find out suitable marketing strategy for the schemes and financial products offered by the Prime Bank Ltd. are treated as a part of the financial products. vii) To prove my hypothesis to be right. at present. iii) To find out the positive as well as negative sights of different schemes and financial products offered by the Prime Bank Ltd.As a Banking institution all the deposit schemes of the Prime Bank Ltd.
information have been collected from the primary sources. Discussion with officers of several banks. graphs.4 Scope of the Study : This report cover's PBL's market position of Deposit scheme It focuses on the over view of Management & organizational structure. 1. secondary scours.5 Methodology: This report is based on Primary & Secondary data. General Banking. In case they could not able to supply my topic related data for preparing a more in depth presentation. annual reports of banks. I have faced many problems that may be terms as the limitation/shortcoming of the study. Trend & growth rate analysis. ii. published doeuments and other published papers & reports. journals.e.1. to prepare this report & for submitting the report. have been used for evaluate consumer credit performance and prepare the report. Loans & Advances and Foreign Exchange Department of PBL. i. It highlights other schemes of PBL. ratio analysis & graphical presentation like chart. For write this report. It also covers the overall performance i. 1.
.6 Limitation Although I have got co-operation from employee of PBL Dhanmondi Branch & Head office and they also gave me much time to make the report properly the way of my study.) It was very tough to collect data for making a comparative study PEL performance about the Deposit scheme. newspaper. bar chart.) The time for the study may not enough for my study.
Prime Bank Limited is a fast growing private sector bank and the Bank is already at the top slot in terms of quality services to the customers and value addition for the shareholders.PART: TWO
Details of Prime Bank Ltd. Prime bank ltd. Against the background of liberalization of economic Policies in Bangladesh. PBL through its steady Progress & continuous success has.: The banking system plays a critical role in underpinning economic development.
Prime Bank. by now. earned the reputation of begin one of the leading private sector Banks of the country. It is not a conventional Bank. has resulted in great success in all areas of operation of its bank with a view to improve the Socio-economic development of the country.
2. Prime bank is the first private bank to introduce lease finance. Prime Bank Ltd. hire purchase & customer credit schemes in the banking sector in order to bring about qualitative changes in the lives of people of Bangladesh.1 Historical Background of Prime Bank Ltd. 100 million of paid up capital by a group of Successful entrepreneurs. It's a modern dynamic private commercial bank & play a constructive role in the economic development of the country. The Bank made
. (PBL) was in corporated on 17 th April 1995 with 1000 million of Authorized Capital & Tk.
Of the 3 new Branches. two are Islamic banking branches pronouncing the Management's vow to strengthen Islamic banking operation alongside conventional banking are very selective in locating branches so that customers can be better served." To work as a team to serve the best interest of the group. The Bank retained its lead position with the capital adequacy ratio of 11.satisfactory progress in all areas of business operation in 2003. During the year under review. The Return of Assets (ROA) was 4. This year we" have already planned to add a few branches to our network. We have a. the network of branches increased to 30 with three branches -one in the Chittagong city and two in the Dhaka city.
. Values The Bank holds the following values: • • • To have a strong customer focus and to builcla relationship based on integrity superior services and mutual benefit. The Bank further expanded and consolidated its customer base in both of its core business and retail banking. which will give the Bank strategic advantages in terms of operation and business potentials.92% as on December end 2003 which is well above the stipulated requirement of 9%. To work for continuous business innovations and improvements. plan to add 50% of new branches as Islamic banking branches to our branch network in order to keep landing operation.13% which was well above the industry average. The Bank closed the year with a number "of achievements registering significant growth in all areas of its operation including profitability.
The bank has some mission to achieve its goals. MotijheelC/A Dhaka.
. • PEL intend to focus more on small and medium sized
enterprises by providing a broad range of financing options.
Corporate Profile Registered office: Adamjee Court Annex Building-2 1 1 9 . Bangladesh Cable: PRIMEBANK Phone: 9567265. and 9566215 E-mail: Primebank@bangla. • The bank intends to increase the advance amount in different sectors.net
2. 9570747-8 PABX Telex: 642459 PRIME BJ Fax: 88-02-9567230. These are: • Its aim to improve customer services further through diversity in product and service.2 Mission of BPL: Prime Bank Limited aims to become one of the top-performing banks by prudent financing to earn sustention profit and rendering of services to customers more efficiently and effectively. To provide recognition and rewards on performance.• •
To value and respect people and make decisions based on merits.1 2 0 .1000. 9560977.
• PEL is always encouraging the client for purchasing its share by creating the opportunity of long-term investment and increasing the value of share through prosperity as developed day by day.• The bank aims to help fixed income group in rising standard of living through financing to customers and small business group. • The bank provides greater sufficient wealth for their shareholders. It products and services such as ATM.4 Director of Prime Bank Ltd. • The bank plays in vital role in socio-economic development of Bangladesh by developing world network in domestic and international operation.
2. ONLINE BANKING & POINT OF SALES transaction.:
. • The Major objective of PEL is to maximize profit through customer's satisfaction.3 Objective & Goals : • PEL is ready to improve the highest quality customer service through new. 2.
We believe were able to assemble a pool of highly talented professionals are proud to . The Bank had compensation always focused on retaining employees through fair bonus as an and creating opportunities for career development. We and excellence of having built the finest team in the country and providing
them an environment in which team. our highest priority. Moreover. As on 31 st December 2003 total number of employees was 777 compared to 730 of 2002. Employees' compensation package and other welfare schemes were adjusted in line with the prevailing market levels. We aimed at.6 Organogram of PBL
2.manage the Bank in an efficient manner.
During the year under review. w^ awarded substantial
incentive for all the employees. We ' continued our efforts to create and develop ethical members and listened to their and cohesive culture. W€ ^-trained them at various levels. As a result. mainly through of training institute. for staff morale had been enhanced by a feeling with stronger loyalty and belongingness to the Bank. Management frequently communicated with staff ideas and suggestions.2. recruitment only competent work force. employees with outstanding performance had been rewarded. Our ' recruitment process is very rigid and policy oriented but fully transparent. creativity
thrives.-sprit.5 Human Resource Management of PBL: The vibrancy of the Bank emanates from its people who are.
Prime Bank Foundation and Social Services
While strengthening risk management and improving asset quality was the main focus for.level executives. Its activities were further recognized and efforts intensified towards welfare related
. Prime Bank Foundation was created at the later part of 2001.7 Prime Bank Training Institution (PBTI):
Prime Bank Training Institute had all along supported the Bank through various in house training courses. we "were also aware of : responsibility to the society to which we belonged of also recognized expectations of but valued customers and shareholders towards our:" commitment for the welfare of poorer sections of the society. PBTI conducted 4 (four) Foundation Training Courses. junior level management staff. Besides. In addition. a (one) workshop was organized on Relationship between Bangladesh Bank and commercial banks for senior.2. In 2003. Against this backdrop. the Institute conducted 6(seven) short courses on Credit Operation and Management. Those were measured for evaluation of performance by life trainees. mid level management staff and senior executives. the Bank. It constantly worked _an improvement ""of" training methods and materials. 8(eight) short courses and 24(twenty 'four) workshops for new recruits. workshops and seminars. Most of the programs were designed in modular form with specific objectives and goals. Law and Practice of Banking and Islamic Banking Operation for mid level management staff. International Trade Finance. The Institute played a significant role in strengthening the capabilities of 00? human resources.
existed. The first branch was opened at Motijheel area in Dhaka. Besides.00 million was donated to the Prime Minister's Relief Fund. In the year under review.initiatives.
2. Khulna. The wise Board has decided to establish a hospital solely managed and funded by Prime Bank Foundation for the benefits of "the underprivileged of the society. PEL divided its branches networks into five arenas i.e. All those strongly reflected strong commitment of the Bank to working closely through Foundation with the community with which it co. Prime Bank Foundation would continue to contribute to the activities that benefit the lives of common people and community throughout Bangladesh. Tk. The main objective of the Foundation was to invest part of the Bank's profit in poverty alleviation and community welfare. The Bank on its own organized friendly cricket matches between a few private banks to promote fellow feeling within the banking community. 5.8 Network of the Branch:
The bank established its business on 17 April 1995. Chittagong. the Foundation had made allocations to different areas of poverty alleviation and primary health care programs for the low income group of people. The Foundation and employees of the Bank took part in diverse charitable and voluntary programs during the year under review. Rajshahi & Sylhet arenas
. were distributed to the cold wave torn people. Now the total number of branches stood at 25 at the and of the year 2002. Dhaka. To add to the above. Accordingly. warm clothes. the Bank participated in major sponsorship programs in the area of sports such as Football and Cricket to popularize the same among the public.
Among these branches 20 of have been licensed by Bangladesh Bank as Authorized Dealers in Foreign Exchange. 3.with 15. 1 & 4 branches respectively. The bank targets to open total 50 branches all over the Bangladesh for providing banking service to their customers. The branch network of PBL is shown in the next page
• Educational Deposit Scheme. The bank offers different types of quality services to its clients. • Special Deposit Scheme. The main function of the bank is customer service. The interest rate is different for the different types of deposits. For current deposit bank doesn't pay any interest. is a service oriented financial institution. PBL offers all types of deposit services to its customer available in today's bank in Bangladesh. • Fixed Deposit • Saving Deposit Account • Short Term Deposit Account • Foreign Currency Deposit Account • Non Resident Taka Account • Non Resident Foreign Currency Deposit Account (NFCD) • Non Resident Investors Taka Account (NITA)
. Deposit Services: The first primary function of the bank is to accept deposits of money from the customer or saver group. PBL performs the functions. • Monthly Benefit Deposit Scheme. which are given bellow: i.2.9 Function of PBL:
Prime Bank ltd. serves following deposit services: • Contributory Saving Scheme. Prime Bank Ltd.
Credit Services: Banking business essentially involves lending. • House Building Financing Scheme • Financing Scheme for Contractors • Computer Software Financing Scheme • Prime Bank Master Card Credit Card • Working Capital Financing • Import Financing • Export Financing • Industrial and Project Financing
. • Consumers Credit Scheme • Lease Finance • Hire-Purchase • Small and Medium Enterprise Credit Scheme • Loan against share & Securities. In fact the deposits are accepted for lending or investment.• Prime Bank Insured Fixed Deposit Scheme. It interest rate ranges from 10% to 16. • Prime Bank Money Scheme • Multi Currency Account
ii.5% PBL gives loans in follows sectors.
T) Pay order (P. Customer Service. They ensure high quality customer services through competent workforce. One of their greatest assets is the trust of its customers. Bank Draft or Demand Draft (D.O) Pay Slip (P.S) Mail Transfer Advice (MTA)
2. The bank lend money in the following forms: • On Line Banking Services • SWIEL Services • Islamic Banking • Locker Services • Exchange Rate. • L/C Delivery Services. PBL has the following arrangement of remittance with in and out side the country. iii. To keep their trust they are to uphold the highest professional & ethical standards amidst all odds of competitive environment. The Prime Bank Provides value added services to their customers.Depending on the requirement of the borrower.10.D) Telephone Transfer (T.1 Insurance Scheme:
40.PEL offers Insurance scheme for its customer like life Insurance. 1000 respectively of a period of 5. 1000
Benefit payable at maturity (Tk). 500 Tk. ii) Monthly Saving Scheme (MSS): PEL has introduced monthly saving scheme in the market offering monthly deposit of Tk. There are two types of Insurance Scheme. The Bank first offers this scheme with a lot of interest amongst the prospective clients to open accounts. middle & low-income group of people PEL has been able to mobilized significant amount of deposit through this product. Tk.50.2 Credit Card . The bank mainly offers their scheme for fixed.000 200.00
. 10 years. Marine. Goods & Industry etc. Fire.10.000 1. Under this scheme the clients will enjoy death risks cover and the bank will pay usual rate of interest as prescribed for that account. 500 & Tk. In order to galvanize the people minds towards saving the middle lower income group of people feels comfortable in saving their money under this scheme. 8. It will help growth of stable deposit in the bank. The saving rate in our country is very low comparing to any other neighboring countries.000 100.000 80. The terminal benefits under this type of deposit are appended in below : Installment Term 5 years 8 years 1 0 years 2.000 75. i) Saving Insurance Scheme (SIS): PEL has introduced saving insurance scheme in the market offering deposit with insurance coverage.
PBL offer Locker service in some selected branch. The bank charges Tk.10.# 01 02 03 04 05 06 07 08 09 10 Fees Annual Fee Additional Fee Replacement Fee Late Payment Fee Excess limit Return Cheque Statement Retrieval Sales Fee Slip Retrieval Out town Fee Gold Int'l 120 (US$) 120 50 10 20 15 5 10 20 Local (Tk) 2500 1500 1000 450 750 350 50 250 250 1000 Salver . Fees for PrimeJlank Credit Card: Sl. International 70 70 35 10 15 10 5 10 15 20 Local (Tk. All preparations are under-Way to launch visa card as early as possible.3 Locker Service . 1000 for larger & smaller
. The bank charge different amount from its clients on yearly based according to the size of locker.Prime Bank Ltd. which has opened up new possibilities for improved customer service and for becoming a dominant player in the market. The Bank has recently obtained principle membership from Visa International. 15000 & Tk. PBL ensues high level of security by inserting its customer photograph on the card and provides 24 hours a day & 365 days a year worldwide service. issues (Master Card) credit card to its customers who have the card pay their bill in to PEL against their card number. Prime bank offers (Master Card) credit card.) 1400 900 500 300 500 250 50 200 200 1000
cheque Collection Fee PIN Replacement Fee 20
If he/she fails to make payment or time. the fees will be adjusted from his/her account. 2. The service named PRIME LINE has opened up several possibilities of improved customer services.
. Under this scheme. Prime Bank Ltd. clients of one branch are able to do banking transaction at any other branch of the bank.10. The bank hosts its web site (ww. Under this service the client should have an account in that particular branch.4 ON-LINE Banking.size.com) to facilitate dissemination of information about our banking services & facilities to out side world. The bank is planning to provide 24 hours customer services by installing Automated Teller Machine (ATM) in the near future.prime-bank. has set up a wide area Network (WAN) across the country to provide on-line branch banking facilities to its valued clients.
1. Demand Deposit: Under demand deposit the client can withdraw his/her money any time without any prior notice. Different types of Account/Deposit Scheme in PBL: The total deposits held by the banker are broadly divided into demand deposits and time deposits. 03. The operational procedures of PEL are divided into following parts. The different types of account/scheme as: follows: i. These are: A) Current Account (CD) B) Saving Account (SB) C) Short term deposit Account (STD)
My Project Part: Deposit Scheme of Prime Bank Limited
A bank is a financial institution. PBL is maintaining the major accounts for deposit mobilization. At present prime bank limited offer three types of demand deposit. which take deposits money from surplus economic unit and provides leading to the deficit economic unit. It plays an important role for developing economic growth in a country & it is a largest mobilizes of surplus domestic savings.
5% interest rate to the clients. C.5%. Under this scheme Bank pays 5% to 8. Under this scheme interest rate is 5. Here clients have to hold money for some period of time & the volume of the deposit will be large than current account. A) Fixed Deposit Receipt (FDR): This is reclassified by period of maturity and is exclusively time deposit.A. Short term Deposit (STD): The characteristics of short-term deposit & current Deposit are same. B. varying from time to time has saving deposits constituted demand deposit. Term Deposit In case of term deposit client can withdraw his/her money offer specific period of time. No interest is allowed on this deposit.0007 • Age Limit for the deposit should be 18 to 45 years
. A portion. This account has chequing facilities & balances are transferable. Saving Account (SB): Deposit on this account is self-explanatory and generally emanates from the individual. ii. Under this scheme there are some terms & condition are as follow: • Minimum deposit of this scheme will be 25. Current Account (CD): This scheme is of the nature of demand deposit. Prime Bank limited offers following kinds of term deposits.
So that with the help of the lump sum amount they received.75% 9.
.25% 9.00% 9.2$%
B) Contributory Saving Scheme (CSS): This is a savings scheme in which a person gets the opportunity to build up saving by contributing monthly installments for getting an attractive fixed amount at the end of a specified term. The Scheme is designed to help the fixed income group to save money and build up a sizable fund. • In case of FDR scheme PEL deals with following terms deposit Term 30 Days 3 months 6 months 1 year 2 years 3 years Interest Rate 8.50% a The minimum time for this scheme is 1 year.50% 8.• Insurance coverage will be available up to Tk.75% 10. they can go for some income-generating venture to improve the quality of their life or meet any future plan and program. 20 lac • Insurance coverage for natural death & for accidental death both deposit amount will be 100 • The range of interest rate of this scheme is 8075% to 10.
Amount payable at Maturity (Taka)
.000 Tk. Tk. 1. 1000 to be deposited every month throughout the savings term. 250 20.50. Tk. 8.000 50. 7) A lump sum amount shall be paid to the depositor after maturity of respective terms of saving as per the following table: Installment Term 5 years 8 years 10 years Tk. 6) have the option to draw Tk.000 80.000 after 10 years. For example. Tk. 500 40. 100 will. 20.000 Tk.000 2. 250.000 15.000 1. Photograph and introduction will be required for opening of the account.000 75. 100.000 1. 4) Account under the Scheme can be opened on the separate Form designed for the purpose. 2) The term of Saving shall be for 5 years and 10 years 3) The depositor will have the option to choose any installment at the time of opening of an Account and will not be allowed to change the size of installment afterwards.00.The salient future of the Scheme are given below: 1) The size of the monthly installment shall be Tk. a depositor with a monthly installment of Tk. 5) The depositor will have the option to close his account specified for the term and draw the amount at the end of any term.000 after 5 years.000 Tk.000 after 8 years and Tk.000 37.00. 15. 500 and Tk.000 20.
00 D) Special Deposit Scheme: This is Deposit Scheme where an instrument is issued for the full amount payable after a specified period against deposit of a certain
. which award monthly scholarship/stipends to students. The investment of wage Earners who want to pay a fixed amount monthly to there families /dependents in Bangladesh from the profit of their investment iii) iv) v) The deposit of those persons who intend to meet the monthly budget of their families from the income out of the deposit. The Scheme is -designed to attract: i) ii) The retirement benefits of service holders.00 and multiples there of shall be acceptable for the Scheme.00. Investment of fund of Trusts and Foundations.000. 2) The Deposit shall be for a period of 5 (five) years.000. 1. 3) Profit shall be paid on monthly basis @ Tk.C)
Monthly Benefit Deposit Scheme: This is a Deposit Scheme where the depositor gets monthly benefit
out his depositor gets monthly benefit out of his deposit. 1.00 per Tk. The Principal amount is refundable on maturity. Parents who want to defray the educational expenses of their children from the monthly benefit of their deposit with the bank.00. The Salient features of the Scheme are given below: 1) Deposit of Tk.000. 1.
. Any other Bank/Organization/Firm/Person can also discount the instrument. the amount of the Instrument will be paid at a discounted rate to the nominee of the payee or. to the legal heirs of the payee on production of Succession Certificate. It may.00 and multiple thereof shall be acceptable under the Scheme. Provident Fund. Trust Fund. 7 or 10 years. if necessary. In case of the Instrument being discounted by other Bank/Organization/Finn /(Person.amount. in the absence of nomination. It will create good opportunity for attractive investment of. But in any case the depositor shall not lose his Principal. the Instrument may be retain with them till maturity or presented at the counter of the issuing Bank for immediate payment at the discounting rate. 3) The Instrument shall not be encashable before maturity. marriage and old age security. 2) An Instrument shall be issued for 5. It will also provide opportunities for the Wages Earners towards profitable investment of their funds. The Salient features of the Scheme are given below: 1) Deposit of Tk. 1. Organizations.00. 4) In case of death of the payee. be discounted at the counter of the issuing Bank at any time @ 15% on the remaining period of maturity. however. The Scheme is specially designed to provide for children education. Reserve Fund/Security Fund of Institutions and. 5) In Instrument will be acceptable as primary /collateral security against any advance/loan subject to registering the lien of he same with the issuing Branch of the Bank.
. The scheme provides a unique opportunity to the parents to make a future provision for the education expenses of their children when they enter in to school.000 Value Payable at maturity (Taka) 1. organization firm. for an amount payable at maturity as written on the face of the Instrument as per the following table: Term 5 years 7 years 1 0 years Initial Deposit (Taka) 1.00.00.000
Amount payable with profit at maturity will vary proportionately as per above table according to the size of initial deposit amount.00.000 3. 7) Bank will issue 'Order Instrument' payable to a particular person. E) Educational Savings Scheme (ESS) Prime Bank limited has introduced a saving scheme entitled "Educational Saving Scheme".000 1. colleges and university out of the benefit of a small amount of savings with the bank at an opportunity moment.000 1. etc. rules pertaining to issuance of Duplicate FDR after loss of Fixed Deposit Receipt (FOR) shall be applicable for such issuance of "Duplicate".00.00. The instrument shall be issued for 7 years.000 2.6) n case of loss of the Instrument. The salient features of the scheme are given below: a) b) Deposit of Tk.and multiplies thereof at a time will be accepted under the scheme. 10 years or 20 years term.
Generally account opening means to open a deposit account. a deposit account & loan account. It binds the Banker & customer into a contractual relationship.e. A) Individual /Joint i) Account Opening Form with nominee form duly filled up
. 3. When a customer want to pen a bank account the banker's has to maintain some common principle & procedure form & he/she have to field those prescribed form & have to attached their organization's document.2. Banker & customer relationship established though opening an account.1 Opening an Account.2 General Precaution in account Opening: There are following papers /document required for opening of various types of accounts.2 Account Opening Department 3.2.1.c)
The deposits is payable at maturity with benefit either in.1.1.lump sum or on monthly basis as educational allowance for six year completion of the respective term as per the following table:
Term 7 years 15 years 20 years
Initial Deposit Amount payable at maturity 25000/25000/25000/25000/55000/77000/136000/240000/-
Education allowance per 1000/month 1500/2500/4500/-
3. There are two types of account i.
iii) iv) v)
One copy of photograph of the Nominee duly attested by the account holder(s). Proper introduction by an introducer. address. Introducer will confirm the identity of the account holder and he/she will also sign in the account opening form as an introducer.
Special instruction (if any)
B) Proprietorship Firm i) ii) Account Opening Form duly filled up. Two Copies of Photograph of the Account holder(s) who will operate the account duly signed by the account holder(s) and attested by the introducer iii) Copy of valid Trade License regarding its validity. title/ownership of the license etc. Introducer will confirm the identity of the account holder by putting his/her signature on the back of the photograph of account holder and he/she will also sign the account opening form as an introducer. Specimen signature Card signed d by the account operator(s) on the presence of an authorized officer of the Bank.ii)
Two copies of Photograph of the Account holder(s) who will operate the account duly signed by the account holder(s) and attested by the introducer. iv) officer of the Bank. Introducer should have acceptability to the bank. Specimen Signature card signed by the account operator(s) on the presence of an authorized
. v) Proper introduction by an introducer should have acceptability to the bank.
Banker will examine the trade license regarding its validity. Proper introduction by an introducer. Introducer will confirm the identity of the account holder(s) & he/she will also sign the account opening form as an introducer. address. iv) v) Specimen signature Card signed by the account operator(s) on the presence of an authorized officer of the Bank.vi)
Special instructions (if any)
C) Partnership Firm i) ii) iii) Account Opening form duly filled up. Two Copies of Photograph of the Account holder(s) who will operate the account duly singed by the account holder(s)
. Introducer should have acceptability to the bank. Two Copies of Photograph of the Account holder(s) and attested by the introducer Copy of valid Trade license duly attested by the Bank Officer. Partnership Account Agreement (Bank's prescribed form) viii) Resolution signed by all partners to open the account & instruction regarding operation of the account. ix) Special instruction (if any)
D) Limited Company: i) ii) and attested by the introducer. title/ ownership of the license etc . vi) vii) Certified copy of partnership deed or copy of partnership deed attested by the MD. Account Opening Form duly filled up.
Specimen signature card signed by the account or)eratof(s) on the presence of an authorized officer of the Bank. Certified copy (Certified by the Register of Joint Stock Company) of Certificate of Incorporation.
List of Director (Included Present & Permanent Address of the Directors) which will be supported by the FORM-12 duly Certified by the Register of joint stock Company. Certified copy (Certified by the Register of Joint Stock Company) of Certified of Commencement of Business. (In case of Public Limited Company). Two copies of Photograph of the Account holder(s) who will operate the account duly signed by the account holder(s) and attested by the introduced. Special instructions (in any)
E) Club /Society/School / College etc. iii) iv) Certified copy of Bye-Laws & Regulations/Constitution duly certified by the Chairman /Secretary. Certified copy of Resolution of Management/ Committee/ Executive Committee duly signed by the member of the
. i) ii) Account Opening Form duly filled up.
Board Resolution duly signed by the Board of Directors as per their Memorandum for opening & operation of their Account with the Bank.iii) iv) v)
Certified copy (Certified by the Register of Joint Stock Company) of Memorandum & Article of Association.
2.committee as per their Memorandum for opening & operation of their Account with the Bank. iii) iv) v) vi) Up to date list of Members of the Trusty Board Certified copy of Deed of Trust Certified copy of Resolution of the trustee Board for opening & operation of their Account with the Bank. specimen Specimen signature Card signed by the account operator (s) on the presence of an authorized officer of the Bank. the banker's has to scrutinized account opening from. After observation of all the formalities /document mentioned above. v) Up to date List of Office Bearers/Governing Body/Managing Committee duly certified by the Chairman/Secretary (Including Present & Permanent Address of the Office Bearers /Governing Body /Managing Committee) vi) vii) F) Trust: i) ii) Account Opening Form duly filled up. Specimen signature Card signed by the account operator(s) on the presence of an authorized officer of the Bank. Two Copies of Photograph of he Account holder(s) who will operate the account duly signed by the account holder(s) and attested by the introducer.3 Documentation after Opening and Account.1. vii) Initial Deposit viii) Special instruction (if any) 3. Special instructions (if any)
481. Then the applicant is required to deposit minimum Tk. a 28% increase compared to Tk. The banker then has to mention the following steps. This was undoubtedly a remarkable progress considering volatile price situation for acquiring deposits. the bank opens an account in the name of the applicant.2 DEPOSIT POSITION OF PRIME BANK LIMITED IN YEAR 1997 TO 2003 At the end of 2003 total deposits stood at Tk.60 million from the preceding year. 16. 21092. for opening a bank account as per account category. Despite our low offering.signature card & all required documents as per accounts category. • Numbering/indexing the account • Issuance of chaque book • Supplying a passbook & pay-in -slip book • Issuance of letter of Thanks to the introducer • Mandate form it the Account holder wants to operate the account by giving a mandate to another person. the Bank had to rationalize pricing for different sets of liability. As soon as this money is deposited. which are also 'related with the opening of an account in all the cases. Before giving the approval of account the branch manager has to used sufficient intelligence & common sense in ascertaining the genuineness of new account. the Bank was able to mobilize substantial deposits
. Because of the weak demand.35 million. Liability pricing came under stress on a number of occasions during the year. this is called initial deposit. • All special instruction to be authenticated by all the signatories of the account. 3.
186.83 9.73 14.644.52
» it i •424.97 5313.7 5 10.82
2662. As on December end 2003.0 0
15.37 13 421.3 0 30.85 100. deposit under various schemes stood Tk.91 million against Tk.13
.9 3765 Q 346.36
Year 2000 tk in millio %of total depos it 536.00 1135. 87
1.8 0 1996. 4.23
7018.7 9 40.05
62.through various deposit schemes. 3.83 7. No Items Year 2002 tkin million %of total depos it 1 2 3 current & other depost saving bank deposit Bearer certificate of deposit 4 5
Year 2001 tkin million %of total depos it 2214.4 2 650.7 6
22998 4 228.02
Year 1999 tkin millio n %of total depos
2649.3 6 1092.67 100.04 8
Fixed deposit Short term deposit
Deposit scheme Others deposit
19.20 7.51 11168.8 5 197.115.84 5. 3.49 100.95 8.1 1 7660.61 8 715.1 THE DEPOSITE MIX AS ON DECEMBER 1997 TO 2003
SI.40 in the last year showing an increase of around 13%.9 9 537.02 0.0 0
41 2000 1524.24
3.98 Deposit Scheme Others deposit 9.5 Performance & Growth of PBL: 3.30 1999 964.08 Anrrent & Other deposit 40.95 Saving bank deposit Beerer certificate Fixed deposit Short term deposit 19. The investment growth of PBL (1997-2001) as mentioned in the following table & graph: Table year Tk.3.3 million against Tk.54 in 2000 & the growth over 2000 is 13%.1 Investment Growth of PEL: The investment of the bank as on 31 st Dec.49 0.4 COMPARATIVE ANALYSIS OF O SIT MIX OF YEAR 200§-1998
1. (in million ) 1997 583.30
(source: annual Report)
. 1729.5. 2001. at Tk. 1524.06 1998 604.54 20QB 1729.02 8.24 20.
Advance Growth of PBL: The bank has formulated its policy to give priority to small & medium enterprises with in the policy guidelines of the bank & Bangladesh addition to traditional financing of commercial & industrial groups. The bank introduces consumer credit scheme that aims to help the fixed income group in raising standard of living have been widely appreciated. 11168.5.72 million of 2000 & the growth rate over the preceding year is 19% has introduced several deposit schemes to encourage & mobilize savings.5. Deposit Growth of PBL: The total deposit of the bank was Tk. (in million) 1997 4236.18 1998 5313. 13269.3.02 2000 11168.9 at the end of Dec.3.2.9
3. Its various purpose oriented deposit scheme have been appreciated by the public & have gained popularity. The deposit growth of the bank (1997-2001) is shown bellow: Year Tk. 2001 as against Tk.72 2001 13259.25 1999 7660. The total
(in million) 1998 17.03 2000 7667.5.73 million of the previous year & the growth over 2000 is 18%. (in million) Is997 1752.11 1998 3127. (1997-2001) as shown in below. Year Tk.39 1999 31.77 1999 5121. 791.4 Net Profit of PEL: Prime Bank limited established in 1995 & in these six years. The growth of advance of the bank. Year Tk. The Bank earned profit worth Tk. 7667. 2001 as against Tk. The profits of the bank (1998-2001) is show in below.82 2001 79.16
.loans & advances of the bank amounted Tk. 60.93 2000 60.9
3.73 2001 9074.6 million at the end of Dec.82 million on 2000 showing & increase of 30% over the preceding year. the bank achieved satisfactory progress in every aspect of its operations.
which is higher than the other sources. This graph is shown as follow: 3.3. find the position of loan as a percentage of total deposit is given below: Year Tk. we find: out the proportion of deposit in the total sources of fund is £4%. in Million 199741% 1998 59% 1999 67% 2000. of Prime Bank Ltd.69% 2003 68%
. LOAN AS A % OF TOTAL DEPOSITE After observation of Annual Report of year 1997 to 2001 of Prime Bank Ltd.6 SOURCES OF FUND After observation the Annual Report 200$.7.
1. The report is completed at Dhanmondi Branch office of PBL. General Banking Department: This department includes the following operation. Time Deposit: Time deposit are repayable on the expire of a fixed period of time only.Dhanmondi Branch of PBL at a Glance The topic 'Marketing of Financial Products in Prime Bank Limited with comparison of other banks is the main part of my internship report / paper.2. The whole activities of the branch are divided into three major departments.2001 . which is started on 02 May. PBL accepts time deposits through the following different deposit scheme.1. • Fixed Deposit
.1. Those are given below: • General Banking Department • Advanced Department • Foreign Exchange Department 4. Demand Deposit: This deposit one with draw able on demand and no prior notice is needed for PBL to accept demand deposit through the opening of: • Current A/C • Saving A/C 4.1. 4.
In the accounts section the officer has to post all the vouchers into the computer under different heads.C) • Mail Transfer Advice (M.A) Under these Departments. account division receives vouchers from every section & they keep it under different heads. & T. It is very important for P.and also transfers it into the record book. In the end of the day. to match the test number. Other Operations: • Cheque Issue • Demand Draft (D. & T.D. D. The total amount of the records has to match with other record book.O. the officer receives & forwards every letters & documents. the particular schedule paper for sending to Bangladesh Bank.D.O) • Telegraphic Transfer • Travelers Cheque (T.T.D) • Pay Order (P. In dispatch section. He/she has to keeps record of collecting cheque & return cheque in the registered book. the bank officer receives different types of cheque.T.T.M. If the total amount of records doesn't match with other
.D. Under remittance department.3. the bank officer writes vouchers of pay order.1. he/she has to make. Every day with in 3 P.• Short-term Deposit • Bearer Certificate Deposit • Contributory Savings Scheme • Educational Saving Scheme • Money Building Scheme 4.
This department exercises the lending function.2. i) ii) •
Pledge & Hypothecation
• Loan General • Secured overdraft (S. then the officers have to check it from the beginning. It is very tough job to do.D) i) ii) iii) Financial obligation General Export
⇒ Working capital ⇒ Bank Guarantee ⇒ Hire Purchase ⇒ Consumer credit scheme
.O. Under this department PEL of offers following types of loans & advance.2. Advance Department.1 Cash Credit. Infect the deposit are accepted for lending or investment. Banking business essentially involves in deposit extraction & credit instruction.records. 4. 4.
This department includes following activities of PEL. Then it has to suffer a lot due to the classified loans & advances & monitoring is made much difficult for banker. If the borrower is not of good character. lending upon which repayment is interest servicing performance deteriorates are to identified at an early stage is closely monitored in order to loan losses. Dhanmondi Branch L/C issue L/C collection & negotiation A/C Advising & conforming FDBP Encasement of Traveler's cheque Presentation & Retirement of Import Documents
.3 Foreign Exchange department. responsible & reliable. In lending.Under credit department. the bank can't easily get the return from the lending. That's why the banker has to maintain some restrictions. 4. borrower selection is the most important step of this department. resourceful.
= 619.received averagedAdvance
2. Yield on Advance
Formula = Intt. Per Employee Deposit
. In Lac.28 lac
= 47.86 =29. Ration Analysis for the Periof of Jan.08 = 3.5 Ratio Analysis of Dhanmondi Branch of PBL.21 times 7.86/513.05/26. Employee Expenses
Formula = employeeExpenditure ToalExpendure
= 619.79% 5.97 = 1.35 lac 8. Overall Productively
Formula = TotalIncome ToalExpendure
= 1.93 = 8. Return on Asset
Formula = Pr ofit Asset
2. Per employee Deposit
Formula = TotalIncome No.20/513.46/224.20/15=41.4. Manpower Productivity
Formula = TotalIncome ToalExpendure
= 619. 2004 Fig. Cost of Fund
Formula = Intt.ofEmployee
= 37. Cost of Fund wit Establishment Cost
Formula = TotalExpenditure Totaldeposit
=513. 01 to Dec.41=7.33/6595.97 = 7.86= 16.PaidonDeposit averagedpost
= 65. Per Employee Profit
10.89% 6.61% 4.
86/73.41 = 40.23/15 = 7.95 = 7%
= 2698.23/619.33/6595.9% 15.33/15 = 179. Employee Expenses to Operational expenses
Formula = EmployeeExpenses OprtionalExpenses
= 2698. Credit Deposit Ratio
Formula = TotalAdvance TotalDeposit
= 6.20 = 16.41/=439.02 lac 11.ofEmployees
= 105.89 lac
= 37. Burden Coverage
Formula = FeeIncome NonInterestExpenses
= 105.Formula =
NetIncome No. Per employee advance
TotalAdvance No. Profit Margin
14.62% 13.35 = 51.70 lac 12.Employees
(Sources of Data: Dhanmondi Branch of PEL)
4.4. 3356. 6595. 30. 2698 Lac as on Dec. 2002 where on Dec. 30. Deposit Growth .1. Branch Performance & Growth 4.58 lac on 2001. Dhanmondi branch of PEL mobilized total deposit of Tk. Advance Growth.41 lac at the end of December 2002 as against Tk.2. The total loans & advances of Dhanmondi branch of PBL stood at Tk. (in lac) 2001 3356. The advance growth of the branch is shown is below:
. 324. Year Tk.6.58 2002 6595.6.99% over the preceding year. The deposit growth of the branch (2001-2002) is shown bellow.6. 2001 it was Tk.32 lac & increase of 87.
4.36 4809.) are furnished bellow: Month January February March April May June July August September October November December Deposit 3269.21 6465.41 Advance 362.6.61 1837.07 1491.52 377.89 6595.09 1551.-Dec.81 1704.18 9799.92 1590.08 6221.96 3748.47 566. (in lac)
2001 324.65 1605.75 5783.3 Month wise trend of Deposit & Advance of Dhanmondi branch of PBL for the year 2002 (Jan.
.82 2698.95 4147.6.50 3482.52 4262.32
4.66 5248.4 Net Profit.40 1085.14 1649.
reliability & responsibility. I have found a fewer number of factors as problems.I have already mentioned that. Year Tk. 2001.
. Dhanmondi Branch of PEL Started in 02 May. Guarantors & renowned sellers of consumer products. • To reduce their defaulter customer & & earn more profit. gathering & analyzing the data on deposit. resourcefulness. they should have to reduce their interest rate because their interest rate is higher than that of other Banks. In these short time the Branch achieved satisfactory progress in every aspects of it operations. -33 lac on 2001. 105 lac as against Tk. in lac 2001 -33 2002 105
(source of Data: Dhanmondi Branch of PBL)
Recommendations : After conducting the survey in different private banks. The following major problems of the PEL & recommendation are thus advised: • To increase effectiveness of various activities on deposit the bank should have to select only potential customer on the basis of the customer's good character. • They should increase mess communication with the clients. During the year 2002 this branch earned profit worth Tk.
Contact with the employers f the defaulter customers (After 03 overdue installment) Issuance of legal notice to the defaulter customers and guarantors prior to classification of the loans. the bank should follows the following particulars: Regular checking of the balance of clients SB/CD/A/CS. Legal action to be taken after failing all possible efforts to recover the Bank's dues. so PBL should have to take some extensive promotional activities to attract more consumers
. Issuance of Appreciation/ Greetings Letter to the regular customers. Periodical visit with the customer to maintain relationship and supervision of supplied articles. Regular communication with the defaulter customers and guarantors Issuance of letter to customers immediately after dishonor of cheque. • to increase recovery rate. so PEL should utilize its existing Management Information system (MIS) effectively. Issuance of letter to the defaulter customer and respective guarantors. The market position of this scheme is very competitive.• for successful handling of this scheme proper supervision & monitoring is essential.
In this situation. Every day new competitors appear into the industry with better innovative ideas & product as well. According to the survey there are few private banks operating this program with low volume & some newly established banks are planning to launch this program in a large volume. compared to traditional banking system. "Deposit Scheme" is one of the innovative products. PBL can actually attract more customer of Deposit & can drive to higher level of performance. PBL is a leading bank for financing & operating Deposit program with more attractive benefits in the private banking sector in our country. In order to serve within such competitive market PEL needs to decrease interest rate for their consumer credit scheme. services. If interest rate decreases & some extensive promotional activities are taken.Conclusion:
The Banking sector plays an important role in modern society &' private banks has made more competitive.
. diversified & dynamic .
2001. Annual Report. Prime Bank Limited. Annual Report. and 2002. 3. Annual Report. 1999. Brochures of different programs of PBL
. 2000. Prime Bank Limited. 4. Prime Bank Limited. 5. 2. Half yearly performance report of PBL for the year of 1999.2001.2000.References: