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OUR BANKING HERITAGE

Southeast Bank Limited is a second-generation bank that was established in 1995 with a dream and a vision to become a
pioneer banking institution of the country and contribute significantly to the growth of the national economy. The Banks
journey began when it was incorporated as a Public Limited Company on March 12, 1995. The Registrar of Joint Stock
Companies and Firms issued the Certificate of Commencement of Business of the Bank on the same date. The Southeast
Bank received its Banking License from the Bangladesh Bank on March 23, 1995. The Banks first branch was opened by
Late M. Saifur Rahman, the then Honourable Finance Minister of the Government of the Peoples Republic of Bangladesh
as the Chief Guest at the commercial hub of the country at 1, Dilkusha Commercial Area, Dhaka on May 25, 1995.

In its arduous journey since, Southeast Bank has succeeded in realizing the dreams of those who established it. Today it is
one of the countrys leading banks in the private sector contributing significantly to the national economy. The Authorized
Capital of the Bank today is Tk.10,000 million. Its Paid-Up-Capital and Reserve reached Tk. 17,095.90 million as on
December 31, 2010. The Bank had 1613 Staff of whom 126 were Executives, 1247 were Officers and 240 were other staff
as on December 31, 2010.

The Southeast Bank was established by leading business personalities and eminent industrialists of the country with stakes
in various segments of the national economy. They established the Bank with a vision to bring efficient and professional
banking service to the people and the business community of Bangladesh to help the national economy grow. The
incumbent Chairman of the Bank is Mr. Alamgir Kabir, FCA, a professional Chartered Accountant. The Banks Managing
Director is Mr. Mahbubul Alam, an eminent banker of the country with 43 years experience in both nationalised and local
private sector banks to his credit.

The Banks operations are built upon unequivocal emphasis on effective corporate governance. The objective is to create,
promote and build long-term company value. The Banks first and the highest priority is to provide effective services and
maximum satisfaction to the customers. The ethos of harmony and co-operation is widely practiced in the Bank. We take
pride in the fact that the public and private face of the Bank is one and identical. We believe that transparency in
decision-making, monitoring mechanism and full disclosure to shareholders and regulatory authorities are essential aspects
of Banks corporate governance and that they create an intense pressure to rationalize Banks services and search for new
competitive advantages. We work ceaselessly within these parameters.

A team of efficient professionals manages the Bank. They create and generate an environment of trust and discipline that
encourages everybody in the Bank to work together for achieving the objectives of the Bank. The culture of maintaining
congenial work-environment in the Bank has further enabled the staff to benchmark themselves better against
management expectations. A commitment to quality and excellence in service is the hallmark of their identity.

Southeast Bank has become a synonym of quality banking services and products. It has a diverse array of products and
services tailored carefully to cater to the needs of all segments of customers. Our operational strategies are structured to
address the special and often complex needs of the customers. In the growth graph, the Bank has generated profit of
Tk.2,763.14 million after provision and income tax in the year 2010. The curve keeps soaring upward everyday making it
one of the leading and most successful banking institutions in Bangladesh with a total asset base of Tk.131,943.48 million
as on December 31, 2010.
Financial Highlights
Deposits + 11.44% Advances + 19.30%
92,453
107,730
96,669 77,498

Deposit Growth Advance Growth


Deposit increased by 11.44% Advances up by 19.30%
to Tk. 107,730 million to Tk. 92,453 million
(2009 Tk. 96,669 million) (2009 Tk. 77,498 million)

Y-2009 Y-2010 Y-2009 Y-2010

Guarantee Business + 91.17% Foreign Remittance + 18.10%


28,082
22,781
23,779

11,917 Guarantee Business Growth Foreign Remittance Growth


Deposit increased by 91.17% Foreign Remittance increased by 18.10%
to Tk. 22,781 million to Tk. 28,082 million
(2009 Tk. 11,917 million (2009 Tk. 23,779 million)

Y-2009 Y-2010 Y-2009 Y-2010

Export Business + 24.47% Import Business + 49.07%


58,158
103,727
46,724

Export Growth 69,583 Import Growth


Export increased by 24.47% Import increased by 49.07%
to Tk. 58,158 million to Tk. 103,727 million
(2009 Tk. 46, 724 million) (2009 Tk. 69,583 million)

Y-2009 Y-2010 Y-2009 Y-2010

Profit after Tax (PAT) + 47.75% Earning Per Share + Tk.45.20


45.20
2,763

32.44
1,870
Profit after Tax Growth
Profit after Tax up by 47.75%
to Tk. 2,763 million Tk. 45.20 for 2010
(2009 Tk. 1,870 million) Tk. 32.44 (Restated) for 2009

Y-2009 Y-2010 Y-2009 Y-2010


Name of the Company : Southeast Bank Limited
02 Chairman
Vice Chairman
:
:
Alamgir Kabir, FCA
Ragib Ali
Managing Director : Mahbubul Alam
Corporate Profile 02 Company Secretary : Muhammad Shahjahan
Financial Calendar in 2010 02 Legal Status : Public Limited Company
Date of Incorporation : March 12, 1995
Key Events in 2010 02 Registered Office : Eunoos Trade Centre
Core Values 03 52-53, Dilkusha C/A (Level 2, 3 & 16),
Core Strengths 03 Dhaka-1000
Line of Business : Banking
Core Competencies 03 Authorized Capital : Tk.10,000.00 million
Vision 04 Paid Up Capital : 6,930.84 million
Year of Initial Public Offer : 1999
Missions 04
Stock Exchange Listing : April 10, 2000 (DSE) & April 24, 2000 (CSE)
Commitments to Clients 04 Phone : 9571115, 7160866, 7173793, 9555466 & 9550081
Ethical Principles 05 Fax : 9550086, 9550093 & 9563102
SWIFT : SEBDBDDHXXX
10 Years at Glance 06
E-mail : info@southeastbank.com.bd
Website : https://www.southeastbank.com.bd/owa
07 Name of the Banks : Southeast Bank Capital Services Limited
Subsidiary Company
07
08
Financial Calendar in 2010
Dividend declaration for 2009 : February 24, 2010
10
Publication of Financial Statement -2009 : March 24, 2010
20 Record Date for 15th AGM : March 11, 2010
15th Annual General Meeting held : March 29, 2010
22
Stock Dividend Credited : April 15, 2010
1R:2 Rights Shares Credited : September 13,2010
to National Exchequer, operational
performance, growth etc. Un-audited Half Yearly Accounts : July 25, 2010
67 (June-2010)mailed to Shareholders
74
77
82
Key Events in 2010
84 January : Business Policy and Managers' Conference held and Annual
85 Budget discussed.
86 February : 35% stock dividend declared for shareholders.
March : 15th Annual General Meeting held.
87
April : Bank's Paid-up Capital reached Tk.4,620.56 million with the
issuance of 35% Bonus Shares for 2009 .
: Credit Rating AA- for Long Term and ST-2 for Short Term.
88 May : Southeast Bank Foundation initiated a scholarship program for
poor but meritorious students as part of Corporate Social
88 Responsibility(CSR).
June : Half-yearly operating profit reached Tk.2,970 million.
90 Total deposit crossed Tk.95,000 million.
100 July : Half-yearly Managers' Conference held for review of
operational performance against budgets.
161 August : Total loans and advances crossed Tk.85,000 million.
September : Bank's Paid-up Capital reached Tk.6,930.84 million with
Qualitative and Quantitative Disclosures the Right issue @ 1:2
under Pillar-3 of Basel-II 161 October : Operating profit crossed landmark of Tk.5,000 million.
List of Branches 171 November : Total Import and Export business reached Tk.145,000 million.
Notice of the 16th AGM 175 December : Southeast Bank Capital Services Limited, a Subsidiary
Proxy Form and Attendence Slip 177 Company of Southeast Bank Limited, started its merchant
banking operation.
: 76th Branch of the Bank which is the last branch in 2010
opened at Dinajpur.
: Yearly operating profit reached Tk.6,750 million.

02 Annual Report - 20 10
Our Core Values
Integrity
Respect
Fairness
Harmony
Team Spirit
Courtesy
Commitment
Service Excellence
Insight and Spirit
Enthusiasm for Work
Business Ethics

Our Core Strengths


Transparent and Quick Decision Making
Efficient Team of Performers
Satisfied Customers
Internal Control
Skilled Risk Management
Diversification

Our Core Competencies


Knowledge
Experience and Expertise
Customer Orientation / Focus
Transparency
Determination
Zeal for Improvement
Pursuit of Disciplined Growth Strategy
Reliability

Annual Report - 20 10 03
Vision

Missions

Commitments

FOUNDATION OF OUR
Our Vision, Missions and Commitments to Clients
Strength
OUR VISION
To be a premier banking institution in Bangladesh and contribute
significantly to the national economy.

OUR MISSIONS

High quality financial services with state of the art technology


Fast customer service
Sustainable growth strategy
Follow ethical standards in business
Steady return on shareholders equity
Innovative banking at a competitive price
Attract and retain quality human resource
Commitment to Corporate Social Responsibility

OUR COMMITMENTS TO CLIENTS


Ours is a customer focused modern banking institution in Bangladesh. We deliver
unparalleled financial services to Retail, Small and Medium Scale Enterprises (SMEs),
Corporate, Institutional, Governmental and individual clients through branch outlets
across the country. Our business initiatives center on the emerging demands of the
market. Our commitments to the clients are the following:

Provide service with high degree of professionalism and use of modern technology.
Create long-term relationship based on mutual trust.
Respond to customer needs with speed and accuracy.
Share their values and beliefs.
Grow as our customers grow.
Provide products and service at competitive pricing.
Ensure safety and security of customers valuables in trust with us

04 Annual Report - 20 10
Ethical Principles
Southeast bank believes that its efforts to become a leading bank in the private sector can only be achieved and sustained
by creating effective corporate governance, inculcating professionalism among its staff and strictly adhering to rules and
regulations. We believe that our aims and objectives can only be realized fully and sustained over time by adherence to ethics
that cannot always be built into sets of rules and regulations. This belief in ethics motivates the bank in its dealings with
those with whom it interacts.

A. We adhere to the following principles in dealing with Customers


1. Strictly follow ethical banking practices.
2. Provide fair treatment to all customers, depositors, and borrowers, without any discrimination.
3. Provide speedy customer service at a very competitive cost.
4. Deal with customers in a transparent manner and without any hidden cost.
5. Maintain strict secrecy of customer account.
6. Provide free financial advice to clients.
7. Deal quickly with complaints received from the customers. We endeavour continuously to build trust and
understanding with customers.
8. We give very competitive return to the depositors on their investment.
9. We listen to our customers and work for improvement of customer service as per their suggestions.
10. We never desert our customers in adversity.
11. We always keep promises we make.

B. We follow the following principles in dealing with Shareholders


1. Adequate disclosure of corporate information and operational results to help them take suitable
investment decisions / options.
2. Stable Dividend Policy and payment of good dividend.
3. Dialogue with them and implementations of their suggestions for improvement
4. Equal treatment to all shareholders irrespective of their individual size of shareholding.

C. We follow the following principles in dealing with our Regulators


1. We are transparent in operations and governance.
2. We have a culture of timely compliance of regulatory requirements.
3. We give their suggestions and directives great value that we implement for improvement of our
corporate governance standard.

D. We follow the following principles for our Employees


1. We do not discriminate on grounds of religion, sex or race at any stage. We recruit the best on the basis
of merit under a rigorous recruitment policy without any biasness or favoritism to anybody.
2. We pay competitive compensation package with career echelon for the really deserving candidates.
3. We care for our employees and respect them
4. We have clearly defined duties and responsibilities for every employee. No one is made a scapegoat
for undefined responsibilities.
5. We have a zero tolerance for any act of dishonesty.
6. We provide a congenial work environment.
7. We encourage freedom to our employees to give opinion for both qualitative and quantitative
improvement of the Bank.
8. We take care of their health and safety.

E. We follow the following principles in respect of Society


1. We believe that the Bank gets business sustenance from the community in which it operates and
therefore must remain responsive to the community and the society in reciprocity.
2. We do not encourage projects which are not environment-friendly for financing by the Bank.
3. We provide material support for protection of environment.
4. We give aid to the poor, helpless and natural-calamity-hit people.
5. We support charitable ventures.
6. We give sponsorships to sports, culture, education, health-care and community development ventures.
7. We support the women as a community and contribute to women empowerment.
8. We are keen to move fast for green banking to protect environment.

Annual Report - 20 10 05
at a glance
In Million Taka

PARTICULARS 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001

Authorized Capital 10,000.00 10,000.00 3,500.00 3,500.00 3,500.00 2,500.00 2,500.00 2,500.00 2,500.00 500.00

Paid up Capital 6,930.84 3,422.64 2,852.20 2,281.76 2,112.74 1,056.37 880.31 677.16 399.30 363.00

Reserve Fund/ Others 10,165.06 6,504.52 4,804.81 4,186.60 2,828.18 1,180.47 769.13 622.98 571.66 394.20

Total Capital (Tier-I+Tier-II) 17,095.90 9,927.16 7,657.01 6,468.36 4,940.92 2,236.84 1,649.44 1,300.14 970.96 757.20

Deposit 107,729.58 96,669.05 68,714.67 55,474.05 46,056.18 38,258.15 27,930.84 19,618.82 15,343.45 10,570.25

Advance 92,452.62 77,497.57 60,281.26 48,164.60 41,147.28 32,551.09 22,001.70 15,541.50 13,027.13 9,178.03

Investment 18,327.65 21,350.23 12,299.61 8,462.86 6,265.55 5,113.14 3,190.15 2,581.61 2,282.08 1,727.44

Import Business 103,726.70 69,582.92 58,019.77 38,470.34 35,125.12 29,079.30 20,229.62 16,270.80 12,817.01 12,187.37

Export Business 58,158.06 46,724.47 42,178.60 28,771.36 25,874.61 13,511.10 6,761.93 3,033.79 2,263.45 2,675.05

Foreign Remittance 28,082.25 23,779.20 15,221.87 11,040.17 13,479.83 3,507.40 1,091.25 654.25 - -

Guarantee Business 22,781.19 11,916.74 15,078.99 9,008.32 8,656.80 7,975.00 4,717.82 3,391.19 2,502.48 1,854.50

Total Income 16,071.33 13,415.21 10,250.13 8,670.47 6,766.11 4,689.55 3,043.49 2,772.52 1,936.54 1,748.18

Total Expenditure 9,316.39 8,800.55 7,237.55 5,754.27 4,703.45 3,216.11 2,234.83 2,107.36 1,443.98 1,256.05

Operating Profit 6,754.94 4,614.66 3,012.58 2,916.20 2,062.66 1,473.44 808.66 665.16 492.56 492.13

Net Profit after Tax and Provision 2,763.13 1,870.19 887.24 1,222.97 909.88 374.20 294.69 256.06 253.56 270.74

Fixed Assets 4,463.08 4,323.59 2,685.56 1,708.11 1,300.39 790.62 313.73 288.02 48.81 36.26

Total Assets 131,943.48 112,676.98 81,181.53 64,370.69 53,706.12 43,294.81 33,744.96 23,135.74 18,882.48 14,468.66

Earning per Share (Tk.) 45.20 32.44 31.11 42.88 59.71 35.42 43.52 45.38 69.85 82.04

Cash (%) 10% - 15% 15% 20% - - 20% 20% 30%


Dividend
Bonus Shares 20% (5:1) 35% (20:7) 20% (5:1) 25% (4:1) 8% (12.5:1) 20% (5:1) 30(10:3) 20% (5:1) 10% (10:1) 10% (10:1)

Return on Equity (ROE) 19.41% 16.51% 12.06% 19.90% 17.98% 17.64% 17.87% 19.69% 26.11% 35.76%

Return on Asset (ROA) 2.26% 1.66% 1.09% 1.90% 1.66% 0.86% 1.00% 1.11% 1.34% 1.87%

Non Performaning Loan 4.26% 3.73% 4.12% 3.77% 3.97% 4.37% 4.96% 2.09% 1.99% 2.78%

Capital Adequacy Ratio 11.25% 11.72% 11.12% 13.00% 11.50% 6.90% 7.83% 9.20% 8.23% 8.77%

Number of Correspondent Banks 152 146 145 140 138 130 122 80 45 40

Number of Foreign Correspondents 645 589 587 598 536 507 463 350 295 280

Number of Shareholders 66,898 22,152 12,536 9,636 8,855 5750 4704 2912 1666 1429

Number of - Banking 1373 1254 1080 964 845 759 685 586 488 479
Employees
- Non Banking 240 148 151 152 153 154 150 115 107 96

Number of Branches 76 56 46 38 31 31 27 23 19 13

06 Annual Report - 20 10
A session of the Board of Directors in progress

Board of Directors Executive Committee


Chairman
Chairman
Alamgir Kabir, FCA
Alamgir Kabir, FCA
Members
Vice Chairman Ragib Ali
Ragib Ali M. A. Kashem
Azim Uddin Ahmed
Directors Dr. Zaidi Sattar
M. A. Kashem A.H.M. Moazzem Hossain
Azim Uddin Ahmed Mahbubul Alam
Bangla Capital Limited represented by Audit Committee
Tahnoun A. Harun
Jusna Ara Kashem Chairman
Azim Uddin Ahmed
Duluma Ahmed
Syed Shahid Ali Members
M. A. Kashem
Rehana Rahman Dr. Zaidi Sattar
Md. Akikur Rahman
Monjur Miah Shariah Supervisory Committee
Sirat Monira Chairman
Karnafuli Tea Co. Limited represented by Professor Moulana Mohammad Salah-Uddin
Abdul Hye
Members
Dr. Zaidi Sattar
A. S. M. Fakhrul Ahsan
A.H.M. Moazzem Hossain Moulana Abdul Hakim Azadi
Alamgir Kabir, FCA
Managing Director Advisor Ragib Ali
Mahbubul Alam Zakir Ahmed Khan M. A. Kashem
Azim Uddin Ahmed
Company Secretary Dr. Zaidi Sattar
Muhammad Shahjahan Mahbubul Alam

Annual Report - 20 10 07
Members of the Management Committee

Management Team
Managing Director
Mahbubul Alam

Deputy Managing Directors Chief of Capital Market Division Executive Director


Syed Imtiaz Hasib Faruq Ahmad Siddiqi M. Serajul Islam
Mohammed Gofran
Shahid Hossain

Senior Executive Vice Presidents


Senior Vice Presidents
Saleh Uddin Ahmed
Mohammad Mahmud Hasan Md. Mosharraf Hossain
Muhammad Shahjahan Md. Abdul Mannan Lt Col Md Abdur Rafique, psc (Retd)
Giash Uddin Ahmed Mahfuzur Rahman Khan Muhammad Hajjaj-Bin-Mahfooz
S. M. Mainuddin Chowdhury A. T. M. Manjurul Alam
Md. Abdul Naim
A. K. M. Nurul Alam A. M. M. Ariful Haque
Md. Shahjahan Sarker
Md. Anwar Hossain Md. Jashim Uddin
Md. Anwar Hossain Md. Abdul Karim
Kamal Uddin Shafiur Rahman
Executive Vice Presidents
Mahbubur Rahman Shabbir Md. Zakir Hossain
M. Kamal Hossain Syed Nurul Bashar Abdul Batin Chowdhury
Haradhan Banik Md. Asadul Azim Nuruddin Md. Sadeque Hussain
Ziaus Shams Chowdhury
Vice Presidents Md. Giash Uddin Bhuiyan
Pritish Kumar Sarker Mirza Akhteruzzaman Begg Panu Ranjan Das
Mustafizur Rahman Golam Akbar Chowdhury
Anwar Uddin Mohammed Hafizur Rahman Chief Financial Officer
Md. Shamsul Huda Nur Hossain Chowdhury
Arun Chandra Paul

08 Annual Report - 20 10
Respected Members of the Board of Directors of the Bank at the 15th Annual General Meeting held on March 29, 2010.

Alamgir Kabir,
Queue of the respected Shareholders at
the registration counters for their
disciplined registration for the 15th
Annual General Meeting held on 29
March, 2010.

A partial view of the respected Shareholders that


attended the 15th Annual General Meeting held
on 29 March, 2010.

Annual Report - 20 10 09
Alamgir Kabir, FCA

Chairmans Report
Bismillahir Rahmanir Rahim

Dear Shareholders:
Assalamualikum

I heartily welcome you to the sixteenth Annual General Meeting of the respected shareholders of the Bank. I have the
pleasure to present before you a report about the performance of the Bank in 2010 with an outlook for the year ahead.

01. OUR OPERATIONS IN TOUGH TIMES


The Southeast Bank advanced another step forward in 2010 towards materializing its vision of becoming a premier
banking institution in Bangladesh. It was a very successful year for the Bank in terms of adding substantial value to our
shareholders and significantly contributing to the growth of the national economy. Achieving continuing business success
was not easy in 2010. The growth of the global economy and recovery from the recent recession in the western world fell
much short of expectations. Domestic competition in the financial sector became more intense.

The growth of the national economy failed to reach its potential due to infrastructural constraints. Money market became
volatile towards the end of the year adding pressure on risk management of the banks.

Your bank has successfully faced all these challenges and achieved greater business success in 2010. The keys to our success
are forward looking strategic planning, management efficiency, effective risk management strategy, strict compliance with
regulatory requirements, quality service, innovation and above all support and co-operation from our stakeholders and
regulators.

10 Annual Report - 20 10
Chairmans Report

In our operation, we know that our stakeholders scrutinize every taka we spend. They want that we operate in a transparent
and socially responsible way and achieve sustainable growth. We do not see sustainability as optional. It is core to our long
term success. We have partnered with our customers and with the society in a broader sense for mutual benefit. We assure
our shareholders that we will continue to remain accountable to you, follow transparent business operations and do our
best to achieve sustainable growth of your institution.

02. OUR OPERATIONAL RESULTS


Southeast Bank has successfully achieved improved operational results with all business targets showing an impressive
upward trend. Banks deposit shot up by 11% to Tk. 107,729.59 million, loans and advances increased by 19% to Tk.
92,452.62 million, volume of import business registered an increase of 49% to Tk. 103,726.70 million, volume of export
business posted growth of 24% to Tk. 58,158.06 million and foreign remittance grew by 18% to Tk. 28,082.25 million
in 2010. The operating profit of the Bank increased by 46% to Tk. 6,754.94 million.

03. OUR CREDIT GROWTH


Credit growth is an issue of paramount importance. We always follow a cautious approach and remain watchful to see that
credit growth is consistent with deposit growth. Besides, loans are extended after ascertaining the credit worthiness of the
borrower. We want to lend more in productive sectors to increase production rather than for conspicuous consumption.
Our credit deposit ratio stood at 85.82% as on 31st December, 2010. Banks credit grew by 19% to Tk92,452.62 million
in 2010 from Tk. 77,497.57 million of the previous year.
We are happy to note that Dr. Atiur Rahman, Governor, Bangladesh Bank, has relentlessly been trying to boost up SME
and Agriculture sectors to enhance countrys GDP. We are ardent supporter of his initiatives and gradually increasing our
lending to these sectors.

04. BANKS CAPITAL MANAGEMENT


Capital plays the central role in the execution of Banks strategies. Our capital management aims at (a) best composition of
capital in relation to our business growth, regulatory requirement and Basel-II compliance and (b) optimum use of capital
through a host of investment options.
Being guided by the above principles, the Banks Paid Up Capital was increased to Tk. 6930.84 million in 2010 through
issuance of 35% bonus share and Rights Shares at 1R:2 i.e. one Right Share for every two shares held by a shareholder on
the record date.

05. OUR BASEL-II PREPAREDNESS


Basel II is an internationally agreed deal signed by the Central Banks of several countries. Under the deal, banks of
Bangladesh will have to achieve international standards that include capital adequacy, risk management and greater
disclosure of banks business results.
Southeast Bank has successfully implemented the Risk Based Capital Adequacy from January 01, 2010 in line with the
Capital Adequacy Framework devised by the Basel Committee on Banking supervision under the guidelines of Bangladesh
Bank. We have been submitting quarterly reports of Minimum Capital Requirement (MCR) under Pillar I of Basel II to
Bangladesh Bank. The total capital of the Bank has been deliberately increased to Tk. 17,095.90 million as on 31st December
2010. We also ensure enough disclosure of financial results and analysis to comply with Pillar II of Basel II requirements.
We have upgraded our IT solution and data store house to facilitate implementation of Pillar II of Basel II.

06. OUR IT DEVELOPMENT IN 2010


We emphasize on the services that a particular technology provides to the customers rather than focusing on the technology
itself and its procuring price. We are increasingly using technology to deliver innovative services to the customers.
The local software BankUltimus of international standard is being successfully used by the Bank. Islamic Banking Module
under Bank ultimus has been customized to suit the needs of our valued customers. Internet Banking System is being
currently used internally. It will be expanded for customers convenience. Existing products are being fine-tuned and more
innovative products are being devised with the support of the new technology.

07. OUR EFFORTS FOR INNOVATION


Only an enabling culture that promotes creative way of working can spur innovation. We give space and flexibility to our
employees to do things differently. We promote innovation and creativity through developing specialization and instituting
system of job mobility. We try not to keep them doing the same job for long. It kills their creativity. I think that is a better
way for them to think outside the box.

Annual Report - 20 10 11
Chairmans Report

The Bank is also run in a way like a family. Our people work in the Bank together in an amiable and friendly environment.
They all together as a team create a fertile soil for innovation with the strong support of their professional skills and deep
commitment. They come from different families to work in one. We give utmost importance to teamwork. We pursue
excellence every day of the week, every week of the month and every month of the year.

08. OUR QUALITY POLICY


Our Quality Policy is to achieve and maintain a reputation for quality in the market by offering products and services that
meet and exceed the requirement of valued customers. We constantly strive to remain the Bank of choice in all our products
and services, welcome feedback from employees and customers to ensure continuous improvement. Offering our
customers excellent service, innovative products and value added banking at a reasonable pricing is our priority. We strive
to develop with our customers a relationship of partnership for mutual growth in commercial pursuits. We demonstrate
vision, professionalism, transparency and integrity in the conduct of our business and service. We long for achieving
disciplined growth and reasonable profitability while operating on a sound financial base. We work to create value for our
customers. Our employees are our most valuable asset and the cornerstone of the Bank. We encourage, motivate and
develop them to be truly professional all the way. We substantially contribute to the achievement of national objectives
applicable to us. Our goal is to reach the top position in the banking industry. To be the best, we keep on growing better.

09. OUR HUMAN RESOURCE POLICY


Employees are our best assets. They are our managers, they are our engines of productivity and they are our partners. This
approach, I believe, makes us successful. In human resource policy, talented people with deep commitment to the Bank is
our priority. We believe, people with right combination of savvy and ambition can afford to shop the right boss, right
colleagues and the right environment. In recruitment, the best is sieved out from the contestants of many. The best is
retained. They are developed as sober and flexible professionals who take care of companys interest, follow code of ethics,
give full days work and work together for a brighter tomorrow for their institution. They are highly paid, but their
compensation is linked to what they contribute.

We concentrate on managing our people more effectively and efficiently. In the process, we focus on pooling skills and
building the people on learning and research program. Knowledge is being effectively managed in the Bank with efficiently
connecting those who know with those who need to know. Personal knowledge is converted into organizational knowledge.
Our people enjoys the advantages of belonging to the organization in which their mutual commitment builds continuity
of a congenial work environment. We deal with our people with respect and never allow any one to take advantage of
hierarchical position.

10. OUR CSR INITIATIVES


While pursuing our business, we are mindful of our responsibility to the society at large. We believe in socially responsible
business and are committed to give something back to the society in a sustainable manner. We remain accountable to the
society and our shareholders on the status of our initiatives on Corporate Social Responsibility. We have carefully crafted
CSR strategy in the light of the needs of the society as well as overall national policy and priorities. Our present CSR
activity covers specific poverty alleviation measures, promotion of education, supporting distressed humanity during
national calamities, women empowerment etc. We are also increasingly giving special attention to green banking to ensure
environmental sustainability. In 2010, the Bank has spent Tk. 23.7 million in implementing CSR activities.

We have established Southeast Bank Foundation in 2002 which is funded by Southeast Bank Ltd. to carry out CSR related
activities in an organized manner. The Foundation has since executed a number of CSR programs on a sustainable basis
which includes scholarship for poor but meritorious students from all over the country, training program for English
teachers of schools for improvement of English teaching. In 2010, Southeast Bank Foundation spent Tk. 21.26 million in
the execution of CSR activities.

We are thankful to Dr. Atiur Rahman, Governor, Bangladesh Bank, for his initiatives and interest in the promotion of CSR
activities by Banks and Financial Institutions. We feel inspired by his encouragement to accelerate the pace of CSR
activities by Southeast Bank Limited for the wellbeing of the down trodden people of the country.

11. RISK MANAGEMENT


Management of risks is of vital importance to the Bank. Our Risk Management is the process by which the bank identifies
key risks, obtains consistent but understandable risk measures and chooses which risks to reduce, which to increase and by
what means. It also includes devising workable procedure to monitor the resulting risk position. The objective of our Risk
Management is to ensure that the Bank operates within the risk levels set by the Central Bank and the Banks Board.

12 Annual Report - 20 10
Chairmans Report

The Board approves the risk policy, analyses and sets risk limits for core risks within the regulatory framework designed by
the Central Bank. The policy is updated based on an analysis of the economic trends and the operating environment. The
risk level of each category of risk is measured and monitored on a continuous basis. Compliance to the prescribed risk levels
is reported to the Board on a regular basis.

12. TEAMWORK
Teamwork continues to be one of the strategic tools to achieve organizational success. Our employees believe in teamwork.
There is teamwork in everything they do to achieve corporate objectives. Consensus is a vital requirement for teamwork
which they build through vigorous discussion and analysis. They help solve problems. They assume responsibility for the
whole task assigned to the team. Resultantly, there is excitement, dedication and commitment. They form into a team and
act within set norms to perform or outperform, to reach or outreach their goals. Their combined effort always produce
tremendous results.

13. CORPORATE GOVERNANCE:


Our corporate governance is about promoting corporate fairness, transparency, trust, respect, culture and accountability
not just to shareholders but to all stakeholders. It ensures that the Bank is responsibly managed and supervised with an
orientation towards value creation.

Our corporate governance start from the top. We are fortunate to have a great Board of Directors to help oversee the
strategic direction. The diverse talent of the Board continues to expand. The broad knowledge, experience and sound
judgment of the members of the Board are very valuable to the company. The forums from which the Board gives the
strategic direction and exercises control mechanism are the following:

a) Board of Directors b) Executive Committee of the Board of Directors c) Audit Committee of the Board of Directors,
and d) Shariah Supervisory Committee to oversee Banks Islamic Banking operations.

Apart from the above, Banks Management, Independent External Auditors, Regulatory Agencies and Shareholders play an
important role in the effective corporate governance of the Bank.

The Bank operates within the legal framework of the Companies Act-1994, the Bank Company Act-1991 and the security
laws. The functional activities of the Bank are constantly supervised by a number of regulatory authorities. They have
prescribed a variety of requirements for the Bank. We are pledge-bound to comply with all the requirements of all
regulatory authorities.

Our corporate governance framework focuses on business risks as well as corporate social responsibility. As a corporate citizen,
we maintain respect for the society, environment and the community in which we operate. Because of our responsible
management and operation, the community finds good reasons for continuity of our existence and further growth.

14. CUSTOMER FOCUS


We are responsive to customer needs and we know what those needs are. Our first step in building superior customer
responsiveness is through motivating the whole company to focus on the customer. Our customer focus starts from the top
level of the organization. A commitment to superior customer focus brings attitudinal changes throughout the Bank and
strengthens our focus on customers. We stay close with our customers and visit as many customers as possible every week
at different levels.

15. OUR SHAREHOLDERS


The daily volume of trading of Southeast Bank Shares in the Dhaka Stock Exchange and the Chittagong Stock Exchange
averaged Tk. 260.72 million and Tk. 31.84 million respectively during the year 2010. We had 66,898 Shareholders as of
31st December, 2010. The shares of the Bank are held by a cross section of people and institutions. The above statistics
demonstrate investors trust and confidence in Southeast Bank Limited.

16. DISCLOSURE POLICY


The Bank greatly weighs regular and prompt communication with its customers, shareholders, regulatory authorities,
employees and the members of the public. Media releases, reports, half-yearly financial statements, annual reports,
disclosure in the Banks website: www.southeastbank.com.bd and annual financial statements in the press provide enough
information about the Bank. Information that could have a substantial impact on the share price of the Company are
quickly disclosed to the regulatory authorities and in the print media for public information.

Annual Report - 20 10 13
Chairmans Report

17. OUTLOOK
Southeast Bank is now well positioned to move forward in the chosen areas of financial services. We have sound capital
base, devoted staff members, loyal customers, basket of rich products and a good management team in a supportive
regulatory environment.

Bangladesh economy is advancing well at annual growth rate of around 6% over the last 5 years. It was one of the most
resilient economies in the face of global economic meltdown. Doing business in Bangladesh has become easier. Bangladesh
had been rated BB-by Standard and Poors which was announced in April, 2010. Moodys Investment Service has assigned
Ba3 rating meaning macro-economic fundamentals of the country is better and it has less chance of facing severe stress on
credit worthiness. It is similar to BB- rating of S&Ps. With such ratings, we foresee new era in global business for us.

With better operating environment, I believe Southeast Bank has a promising future. Amid intensifying competition, it is
becoming increasingly difficult to maintain a competitive edge. Nevertheless, we are committed to the realization of
sustainable increase in corporate value through speedy business development, combination and enhancement of existing
strategic business and establishment of new strategic business. We are duty-bound to meet the expectations of our
customers, shareholders, the market and the society by speedily producing results.

18. ACKNOWLEDGEMENT
I am thankful to the Almighty Allah for the business success of the bank in 2010 amid competitive business conditions
and global economic recession. I also take the opportunity to thank the Directors of the Bank for their support and input
during the year under review. Their collective wisdom substantially contributed to our success.

I also thank our Management and the members of the staff under the able leadership of the Managing Director for their
loyalty, support and relentless efforts for Banks qualitative and quantitative improvements. I respect their zeal to work hard
to reach newer heights of success.

I conclude by conveying my very sincere and special thanks to our respected shareholders, valued customers, patrons,
well-wishers, the Government of the Peoples Republic of Bangladesh, Bangladesh Bank, Registrar of Joint Stock
Companies and Firms, the Securities and Exchange Commission, the Dhaka Stock Exchange Limited, the Chittagong
Stock Exchange Limited and all others concerned who have supported us and extended to us their valued co-operation.
We look forward to their continued support, co-operation and guidance that are our constant source of encouragement in
the days ahead. We renew to them our promise to remain disciplined, compliant and result-oriented in all our endeavors
and in return seek their co-operation.

May the Almighty Allah in His infinite mercy bestow upon us compassion and blessings.

Allah Hafiz

With warm regards,

Sincerely yours,

Alamgir Kabir, FCA


Chairman

14 Annual Report - 20 10
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Annual Report - 20 10 17
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18 Annual Report - 20 10
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Annual Report - 20 10 19
Mahbubul Alam

From the Desk of Managing Director


2010 was indeed a challenging year in the local and the international banking sector as the world was still coping with
aftershock left by Global Recession that continued in the year. The increase in commodities and oil prices in global market,
falling prices and stiff competition faced in the Readymade Garments sector from other emerging markets and increase in
inflation of the country stressed the countrys banking sector throughout the year.

Despite the exigent backdrop, with the effective crisis management strategies formulated by our Board of Directors and
backed by a highly committed team of professionals in our workforce, Southeast Bank registered a solid performance in
2010, which is reflected in all the performance indicators including profitability, imports and exports, foreign remittance,
loans and deposits and capital adequacy. The operating profit of Southeast Bank stood at Tk.6,754.94 million over
Tk.4,614.66 million of 2009 showing a growth of 46% from previous year. Return on Equity (RoE) was 19.41% and
Return on Assets (RoA) was 2.26% in 2010. The Bank was one of the leading local banks in terms of assets and liabilities
in 2010. The deposits of the Bank increased by 11% to Tk.107,729.59 million from Tk.96,669.05 million of 2009 while
the lending of the Bank grew by 19% from Tk.77,497.57 million in 2009 to Tk.92,452.62 million in 2010.

Loans and advances were well diversified in various viable sectors and deposit mix of the Bank was optimized to ensure
prudent management of the assets and liabilities of the Bank, which resulted in the steady and consistent growth of the
Bank.

Amidst tough competition in the local banking sector, Southeast Bank was able to capture a sizable share of the
International Trade and Foreign Remittance business done in Bangladesh during 2010. The Banks export grew from
Tk.46,724.47 million of 2009 to Tk.58,158.06 million in 2010 which is 24% higher than the export of 2009. The Banks
facilitated imports for Tk.103,726.70 million in 2010 which is 49% higher than the import of previous year.

Due to the exercise of efficient cost control measures, cost income ratio was significantly lower than the industry average
while our profit per branch and the profit per employee still continued to be the highest among our local peer banks in
2010. Our fee based income stood at Tk.1,374.94 million showing good annual growth.

20 Annual Report - 20 10
From the Desk of Managing Director

In 2010, with the guidance from our learned Board of Directors, an effective and continuous Risk Monitoring Policy was
devised to guard against bad loans and to maintain quality of assets of the Bank. Prudent credit policies were adopted to
keep the NPLs at a tolerable limit. The Banks Risk Management Unit formed in 2009 had been continuously working
toward assessment and mitigation of various types of risk. Capital Adequacy has been calculated as per BASEL II. In 2010
the CAR was 11.26% (consolidated) which is well above the requirement set by Bangladesh Bank (9%).
Southeast Banks Capital Market activities have been centralized under a separate Subsidiary since Sept, 2010 named
Capital Services Limited. Under the new Subsidiary, we wish to diversify our investment portfolio to Capital Market to
attain sound profitability from the sector while exercising due caution and with a proper understanding of the volatility of
the countrys money market.
Since inception, Southeast Bank made continuous effort to extend its reach to the customers even in the remotest corner
of the country. In line with this strategy, every year new branches are opened in both urban and rural areas. In 2010 another
10 branches were added with the Bank making a total network of 76 branches. In addition to the expansion of Banks own
network of ATMs, arrangements were made for shared ATMs of other local players with larger ATM network.
Our Research and Development Team is in continuous pursuit to develop innovative products to mobilize more deposits
for the Bank.
Southeast Bank is now at the final stage of implementing the highly sophisticated local Core Banking Solution named
Bank Ultimus which enables the Bank to provide Realtime Online Banking Solutions for both retail and trade based
customers.
In order to create an environment of professionalism, banking acumen, sound risk management and proper understanding
of customer needs, employees from entry level to higher level are regularly sent to trainings and workshops in Southeast
Bank Training Institute, Bangladesh Institute of Bank Management (BIBM), Bangladesh Bank Training Institute (BBTI)
as well as in trainings organized by SEDF, ADB and other foreign organizations. The Bank follows a transparent
recruitment policy where eligible candidates are selected through a comprehensive merit based recruitment process. The
Bank enforces a strict code of conduct among its employees that ensures non-bias, non-discrimination and congenial work
environment.
In Southeast Bank we firmly believe in the concept of Corporate Social Responsibility whereby we integrate social and
environmental concerns into our business operations. Southeast Bank Foundation established in 2002 has been highly
active in the area of promoting education and poverty alleviation of the country.
Future Outlook:
We have set the following goals for ourselves in 2011:
Increase our market share both in the corporate and retail banking sector.
Strengthen our technology platform to install highly efficient and cost effective product solutions for the customers.
Enhance our corporate brand image through promotional campaigns and marketing activities.
Expand our remittance mobilizing activities, design special schemes for wage earners to give them highest level of
benefit and convenience.
Maintain high standard for asset quality through disciplined credit risk management and risk monitoring.
Participate in the viable projects under PPP (Public Private Participation) in Power and Energy Sector
Strengthen our Syndication and Club Financing operations

We are committed to do this through ensuring the highest level of ethical standard, professional integrity, corporate
governance and regulatory compliance while achieving healthy growth in profitability to create greater added value for our
shareholders.
With this thought, I convey my sincere gratitude to all the learned members of the Board of Directors, Regulatory
Agencies, Valued Customers and Shareholders, Correspondent Partners for their continuous support, advice and guidance
in shaping up the Southeast Bank as a Visionary Bank of today. I also pray to the Almighty Allah for the eternal Mercy and
Blessings for our sustainable growth and prosperity.

Mahbubul Alam
Managing Director

Annual Report - 20 10 21
Boards Report
Dear Shareholders :
The Board of Directors of Southeast Bank Limited takes the opportunity to welcome you all to the 16th Annual General
Meeting of the Shareholders and has immense pleasure to present before you the 16th Annual Report of the Bank together
with the Auditors Report for the year ended December, 2010.

01. Global Economic Situation and Prospects in 2011


The growth of world economy is likely to decelerate in 2011 after a year of fragile and uneven recovery last year. The
recovery in 2010 was sluggish in advanced countries and much stronger in emerging and developing countries. The global
GDP is estimated to have increased 3.9 percent in 2010, a year of rebound from the 2009 recession. The World Bank in its
latest forecast estimates global growth of 3.3 percent this year. Emerging and developing countries are expected to grow by
6.0 percent, down from 7.0 percent in 2010 while the growth of high income countries are likely to decelerate from 2.8
percent in 2010 to 2.4 percent this year.

The pace of global recovery will continue to be affected by the weaknesses in major developed economies posing risks to
world economic stability in coming years, says the IMF report on World Economic Situation and Prospects 2011. The
growth of US economy is likely to decelerate to 2.2 percent in 2011 from 2.6 percent in 2010. The prospects for Europe
and Japan are even dimmer. Economic recovery in the euro area is forecast to virtually stagnate at 1.3 percent in 2011.
Many European countries will witness even less growth especially those in which drastic fiscal cuts and high unemployment
are draining domestic demand. Faced with persistent deflation and rising public debt, Japan is expected to grow by a
meager 1.1 percent in 2011.

Developing countries will continue to drive the global recovery this year in varying degrees though their expansion will
moderate a bit. Developing Asia, led by China and India, will continue to show strongest growth performance but GDP
growth is expected to show some moderation. The overall pace of economic growth is likely to be too weak to give the
recovery solid traction, says the World Bank. Unfortunately these growth rates are unlikely to be fast enough to eliminate
unemployment and slack in the hardest-hit economies and economic sectors . . . . Serious tensions and pitfalls persist in the
global economy, which, in the short run, could derail the recovery in different degrees. Threats that could derail the
recovery includes the euro-zone financial market crisis, volatile capital flows and rising prices of commodities including
food and fuel, the 187 - Nation Institution said.

22 Annual Report - 20 10
Boards Report

Developing countries in Asia and Africa will face moderate slowdown in growth emanating mainly from higher
commodity prices; especially food and fuel. If international prices of food continue to rise, the issues of affordability and
poverty impacts could intensify. Policy makers in these countries are likely to give more attention to get inflation under
control, the consequences of which would be weaker growth.
02. A Review of Bangladesh Economy in 2010
Despite global economic meltdown and energy and infrastructure shortage, most of the economic indicators of the country
showed positive trend throughout the year except some volatility in the money and capital markets.
The economy managed to achieve a 5.8 percent growth during the fiscal 2009-10. The Government has targeted a 6.7
percent GDP growth for the fiscal FY11 and if the economic performance observed in the third and fourth quarters of
2010 can be sustained, the projected growth target should not be difficult to achieve.
Agriculture sector grew by 4.7 percent in FY10 up from 4.1 in FY09. Industry sector growth was 6 percent in FY10 down
from 6.5 percent in 09. Growth in service sector slightly rose to 6.4 percent in FY10 from 6.3 percent in FY09.
After moderating at the beginning of FY11 from the rising trend observed in the previous year, inflation rate reached 7.6
percent in September 2010. Tax revenue collection has grown robustly by 25.7 percent during the first four months of
FY11 over the corresponding period of last year. Broad Money (M2) grew by 22.9 percent in August 2010 higher than 19.2
percent growth in August 2009. Bangladesh Banks monetary programme for FY11 was set to provide adequate monetary
accommodation conducive to 6.7 percent GDP growth target to be achieved in FY11. The programme provides for 16.0
percent credit growth to the private sector against high base that grew 24.2 percent in 2010 to support Bangladesh Banks
growth friendly monetary policy as well as to contain inflation at the targeted level of 6.5 percent for FY11 says Annual
Report 2009-2010 of the Central Bank.
Export grew by 35.8 percent to $8.27 billion during July November of FY11 compared to the same period of the
previous year. Import growth was also over 35.00 percent higher compared to the same period of FY10. The Country
received $10 billion in remittance during the first eleven months of 2010 against nearly $11 billion in 2009. Trade deficit
widened to 1.3 billion during July - September of 2010, up from $739 million during the same period of last year.
With adequate energy, infrastructure and more favorable business environment, the economy has the potential to grow
over 7 percent annually. According to the Annual Report (2009-2010) of Bangladesh Bank, the downside risks for
attaining the potential growth are uncertainty in the full implementation of the Annual Development Programme, tardy
implementation of the projects of power sector, delayed institutionalization of Public Private Partnership (PPP) program,
unmet expected improvement of efficiency of ports, upward inflationary pressure emanating from oil and food prices in
the international and domestic markets and the downward trends of manpower export and remittance inflows.
03. An Overview of the Bank
Southeast Bank Limited, a second generation private Bank, emerged in 1995 amid liberalization of global economies.
Currently, its Authorized Capital is Tk.10,000.00 million and its capital and reserve reached 17,095.90 million as of
December 31, 2010. Its vision is to stand out as a premier banking institution in Bangladesh and contribute significantly
to the national economy.
The Bank, in the meantime, successfully completed 16th year of banking operations recording significant growth in all the
performance indicators. In 2010, the Bank earned an after tax profit of Tk. 2,763.13 million. The deposit of the bank grew
by 11 percent to Tk.107,729.59 million and advance by 19 percent to Tk.92,452.62 million compared to those of 2009.
During the last five years (2006-2010), the Bank achieved an average annual growth of 23 percent in deposit, 23 percent
in advances, 37 percent in export and 30 percent in import and 76 percent in remittance. During the last six years, the
export volume increased by three times to Tk.58,158.06 million and foreign remittance increased by eight times to
Tk.28,082.25 million.
Operational excellence coupled with qualitative improvements continued to be of paramount importance to the Bank. At
present, the Bank has 76 branches and 2 Off-Shore Units across the country. Plans have been drawn to raise another 10
branches and at least 10 more SME / Krishi Branches in 2011. Our journey towards greater operational success continues
with increased energy and enthusiasm.
As we face the stiff challenges ahead on the way to further improving the profitability of the Bank, we rely on our skilled
and experienced workforce. Our strengths are our close and cordial partnership with customers, our firmly anchored
presence in the country's strategic places of commercial and business importance and global reach through our
correspondent Banks for expansion of foreign trade, foreign exchange and remittance business. Our product-basket
encompasses Real Time Online Branch Banking, Islamic Banking, Merchant Banking, Dual Currency Visa Credit Card,
Visa Travel Card, ATMs, Education Loan Scheme, Double Benefit Scheme, Consumer Loan, Millionaire Deposit Scheme,
SME Banking, Corporate Banking, Syndicate Loan, Monthly Savings Scheme, Monthly Income Scheme, Pension Saving
Scheme, Wage Earner Pension Scheme, SMS Banking etc. in addition to our traditional credit and foreign trade related
products and services.

Annual Report - 20 10 23
Boards Report

High quality customer service through the integration of the latest and state of the art banking
technology and products is our tool to achieve success. Customers are our first priority. We are
trying hard to provide a system of one-stop shopping for customers by providing a spectrum
of services. Our employees have mastered new technology, enhanced their product knowledge
and honed their skill to help customers meet their financial goals. We want to be the best at
helping customers become financially better off by providing free advice, innovative
leading-edge financial solutions, choice and convenience. Whether our customers are
individuals, small businessmen, or commercial clients, we aim to deliver the best customer
service by meeting their unique and different needs in a professional, ethical, friendly and
knowledgeable manner.

We are pledge-bound to turn Southeast Bank into a modern banking institution, dynamic in
actions, progressive in programs, honest in dealings, just in judgment, futuristic in attitude,
fair in approaches and devoted to high quality service to customers. Our charted plans are
aimed at boosting modern management, advanced technology, good profitability, sound
financial strength and fair image of the Bank. We are firmly committed to transparent,
responsible and accountable corporate governance with the participation of our strong and
most capable team of professionals and under the prized policy directives and guidance of the
Board of Directors of the Bank.
Honorable Members of the Board of
Directors on the stage at the Banks Annual Southeast Bank Limited carries out business activities with due respect to its values and norms
Business Policy and Managers Conference and with an understanding of the importance a large financial institution has for the society
held on January 27, 2010. and the environment. It is moving fast to Green Banking. The bank wants to ensure its
shareholders a competitive return in line with the best among peer institutions.

04. Capital and Reserves


The Authorized Capital of the Bank was Tk.10,000.00 million and paid-up Capital was
Tk.6,930.84 million as of December 31, 2010. The Capital and Reserve of the Bank in 2010
stood at Tk.17,095.90 million compared to Tk.9,927.16 million of the previous year showing
an increase of 72.21 percent.

The Capital and Reserve of the Bank as on 31st December, 2010 are appended below:
Capital and Reserves Taka in Million
Taka in Million
18,000 (a) Core Capital (Tier-I Capital) :
16,000
14,000 Paid Up Capital 6,930.84
12,000 Statutory Reserve 3,650.25
10,000
8,000 Non-repayable shere premium account 1,386.17
6,000
4,000 General Reserve 247.65
2,000
0 Retained Earnings 1,778.64
2006 2007 2008 2009 2010
Total Core Capital 13,993.55

(b) Supplementary Capital (Tier-II Capital)


Provision for Unclassified Advances 972.20
General Provision on off. Balance Sheet Exposures 554.28
Assets Revaluation Reserves 1,064.47
Revaluation Reserves of Government Securities 511.40
Revaluation Reserves for equity instruments -
Exchange Equalization Account -
Total Supplementary Capital 3,102.35
17,095.90

05. Capital Adequacy Ratio


The Bank maintained capital adequacy ratio of 11.25 percent of the risk-weighted assets an on
December 31, 2010 as against the minimum capital requirement of 9 percent as set by
Bangladesh Bank under Basel-II reporting.

24 Annual Report - 20 10
Boards Report

06. Capital Market Scenario in 2010


In the year 2010, institutional investors, mainly Financial Institutions along with tens of
thousands of new small investors from across the country have invested crores of money in the
countrys two Stock Exchanges. The influx of liquidity forced share prices of many companies
to go up substantiating that their market prices were higher compared to their market
fundamentals. Change in denomination or rumor of change of denomination of share face
value from Tk.100/= to Tk.10/- also encouraged small investors to invest more in those stocks
traded in the bourses of the country in the year 2010. Investors confidences in the Stock
Market was high almost throughout the year 2010. Consequently, return of discipline in the
Market and price correction became inevitable.
Shareholders Equity
At the end of 2010, DSE General Index closed at 8,290.41points compared to 4,535.53 Taka in Million
points of the previous year. The index gained 3,754.88 points or 81.71 percent in 2010. The 18,000
16,000
highest closing level of the Index during the year was 8,918.51 points as on December 05, 14,000
2010 according to DSE statistical report. The total market capitalization at the end of the year 12,000
2010 reached Tk.3,508.00 billion compared to Tk.1,903.20 billion of the previous year which 10,000
is up by 84.32 percent. 8,000
6,000
4,000
25 companies offered part of their shares to the public as Initial Public Offerings (IPOs) in the year.
2,000
The total value of offered shares reached Tk.34,788.10 million. All 25 new companies were listed 0
and their shares were traded in DSE in 2010 bringing the total number of listed companies to 218. 2006 2007 2008 2009 2010

07. Southeast Bank Shares and its Owners


All stock market indicators reflect sound financial base of our Bank namely Earning Per Share
(EPS), Trend of Dividend Declaration, Net Asset Value Per Share (NAV), Cash Flow from
Operation, Balance in Share Premium Account, General Reserve, Price Earning Ratio (PE) etc.
The shareholders of Southeast Bank Limited look for satisfactory return on their investment for
the long term and carefully evaluate the fundamentals of a company before making investment.

i) Number of Shareholders
A large number of shareholders repose their trust in our Banks Securities. The number of
Banks registered shareholders rose to 66,898 on 31st December 2010 from 22,152 of the
previous year showing an increase of 202.00 percent. The trend of increase in the number of
shareholders of the Bank for the last five years is shown below:
Company's Securities
Year Shareholders Growth Rate in Electronic and
2010 66,898 202.00% Physical form
2009 22,152 76.70%
2008 12,536 30.09%
2007 9,636 8.82%
2006 8,855 54.00%
Demat Shares
ii) Positive Earning Per Share (EPS) Remat Shares
The total Paid-Up Shares of the Bank stood at 6,93,08,404 at the end of the year 2010. Since Paper Shares
our listing with the two bourses of the country, the number of issued shares increased by
2210.28%. We are generating substantial amount of profit through operational excellence for
the last six years and allocated good rate of dividend against each outstanding share of the
company. Our EPS which is a prime indicator of the Banks profitability is shown below for
the last five years:
in Taka
Year Earning Per Share
2010 45.20
2009 32.44
2008 31.11
2007 42.88
2006 59.71

Annual Report - 20 10 25
Boards Report

iii). Satisfactory Net Asset Value (NAV)


Our Companys Net Asset Value per share is always positive reflecting higher assets compared
to liabilities. For our better NAV, a large number of investors subscribed to our shares. The Net
Asset Value of the Bank since 2006 is given below:
Year Net Asset Value (NAV)
per Share (in Tk.)
2010 247.38
2009 331.01
2008 257.95
2007 269.29
2006 239.47
iv) Authorized Capital and Paid-Up Capital
Net Asset Value (NAV) per Share
Our Authorized Capital and Issued Share Capital have considerably increased since inception.
350
In Taka At present our Authorized Capital is Tk.10,000.00 million and our Paid-Up Capital is
300 Tk.6,930.84 million. The Banks year-wise Authorized Capital and Paid-Up-Capital since
1995 are shown below:
250
200 Year Authorized Capital Paid Up Capital
150 (Taka in million) (Taka in million)
100 2010 10,000.00 6,930.84
50 2009 10,000.00 3,422.63
0
2006 2007 2008 2009 2010
2008 3,500.00 2,852.20
2007 3,500.00 2,281.76
2006 3,500.00 2,112.74
2005 2,500.00 1,056.37
2004 2,500.00 880.31
2003 2,500.00 677.16
2002 2,500.00 399.30
2001 500.00 363.00
2000 500.00 330.00
1999 500.00 300.00
1998 500.00 150.00
1997 500.00 125.00
Growth in Paid up Capital
1996 500.00 100.00
Taka in million
1995 500.00 100.00
7,000
6,000 v) Declaration of Dividend
5,000
4,000 In the preceding years, our Board of Directors declared dividend out of profit to companys
3,000 shareholders at a good rate. Therefore, shareholders of our Bank always received satisfactory
2,000 dividend. The rates of Cash Dividend and Stock Dividend declared by the Bank since 2006 are
1,000
0
shown below:
2006 2007 2008 2009 2010
Year Cash Dividend Stock Dividend Total
2010 10% 20% 30%
2009 - 35% 35%
2008 15% 20% 35%
2007 15% 25% 40%
2006 20% 8% 28%

vi) Rights Issue of Shares of the Bank


In the year 2003, Southeast Bank Limited issued 16,50,000 Ordinary Shares as Rights Issue of
Shares to the existing shareholders at par at the ratio of 1R:2. The Bank issued 1,05,63,696
Ordinary Shares as Rights Issue of Shares in 2006 which were issued at issue price of Tk.200/-
each with a premium of Tk.100/- per share. The Bank also issued 2,31,02,801 Ordinary
Shares as Rights Issue of Shares in 2010 at issue price of Tk.160/- each with a premium of
Tk.60/- per share to build-up a good capital base.

26 Annual Report - 20 10
Boards Report

vii) Characteristics of Shares of Southeast Bank at a Glance


1. Large number of Shareholders.
2. Good and satisfactory rate of dividend.
3. Positive Earning Per Share (EPS).
4. Good Net Asset Value per share (NAV).
5. Traded in both the bourses of the country as an 'A' category share.

08. Deposits
The Bank mobilized total deposits of Tk.107,729.59 million as of December, 2010 as
compared to Tk.96,669.05 million in 2009. Competitive interest rates, attractive deposit Deposit Mix
products, deposit mobilization efforts of the employees and confidence reposed by the
customers in the Bank contributed to the notable growth in deposits. The Bank introduced a
number of attractive deposit schemes to cater to the requirement of small and medium savers.
This improved not only the quantum of deposits but also brought about qualitative changes in
deposits structure. The deposit mix of the Bank as on December 31, 2010 was as follows:

Particulars Taka in Million Share in Total


Deposits
a) Current and Other Deposits 10,048.97 9.33% Current and Other Deposits - 9.33%
Savings Bank Deposits - 5.36%
b) Savings Bank Deposits 5,773.71 5.36% Short Notice Deposits - 7.31%
c) Short Notice Deposits 7,877.81 7.31% Fixed Deposits or Term Deposits - 74.11%
d) Fixed Deposits or Term Deposits 79,836.86 74.11% Fund under different deposit Schemes - 2.64%
Bills Payable Accounts - 1.25%
e) Fund under different deposit Schemes 2,846.02 2.64%
f) Bills Payable Accounts 1,346.21 1.25%
TOTAL : 107,729.59 100.00%

09. Credit policy


Southeast Bank has formulated and implemented a well devised lending policy in accordance
with the guidelines provided by Bangladesh Bank to minimize the risks of default. The policy
broadly encompasses all the aspects of prudent lending procedure (i) the permissible and
priority sectors (ii) the selection process (iii) the approval procedure (iv) documentation (v)
monitoring and supervision. Deposit Growth
Taka in million
120,000
Additionally, the Bank also devised separate policy and guidelines to cover the business 100,000
80,000
requirements of the specific sectors like consumers for household products, home loan, car
60,000
loan, SME business, Agricultural credit, Leather sector in limited scale etc. 40,000
20,000
10. Loans and advances 0
2006 2007 2008 2009 2010
Year 2010 saw many ups and downs in the economic field of the country. The capital market
witnessed unprecedented surge from the middle of the year and also the market started to
decrease in the last quarter. The commercial banks faced liquidity problem and had to squeeze
their lending to some extent. The loans and advances portfolio stood at Tk.92,452.62 million
as on 31st December, 2010 in comparison to Tk.77,497.57 million as on 31st December,
2009 registering a growth of 19%.

The loan portfolio of the bank covered different sectors like ready made garments, textile,
spinning, dyeing, ceramics, pharmaceuticals, telecommunication, petroleum, steel,
engineering, ship scrapping, cement, edible oil, sugar industry, real estate, transport,
agriculture, SME and other commercial products ensuring diversification without
concentration in any specific sector.

Annual Report - 20 10 27
Boards Report

11. Loans to Directors


No fresh loan was allowed to any Director of the Bank during the year 2010.
12. Guarantee Business
The Bank issued guarantees amounting to Tk.22,781.19 million during the year 2010
compared to Tk.11,916.70 million recorded in the previous year registering a growth of 91.17
percent. The guarantees were issued in favour of different Govt. Authorities, Ministries,
Autonomous Bodies, Corporations, Private Companies, Individuals and Multinational
Companies, etc. on behalf of the valued clients of the Bank.
13. SME Finance
In line with the Government and Bangladesh Banks policy guidelines, promoting a dynamic
SME sector is a priority to the Bank. During 2010, the Bank increased financing in the SME
sector by opening another 10 (Ten) SME / Krishi Branches
throughout the country resulting in 15 (Fifteen) SME / Krishi
Sector -wise Allocation of Loans & Advances Branches by the end of December, 2010. Outstanding loan in SME
stood at Tk.13,060.00 Million as on December 31, 2010 compared
Agriculture, Fishing, Forestry to Tk.8,884.30 Million as on December 31, 2009 resulting in
and Dairy Farm 47.01% growth in the sector.
Industry (Jute, Textile, Garments, In order to finance further in the SME sector, the bank is actively
Chemicals, Cements, etc.)
considering additional resource mobilization in SME, redesign its
Working Capital finance
products and re-structure its business process. The Bank has also
Export Credit identified Indigenous Weavers located in Tangail, in addition to the
Commercial Credit already undertaken project to finance small Leather Goods
Small and Cottage industries producers in the Old Dhaka City area, as potential customers under
Others cluster financing and already conducted base line survey, diagnostic
study and formulated an action plan to finance this activity.

14. Consumer Credit Scheme (CCS)


The consumer credit loans were extended for household purchases like Refrigerator, Television,
Washing Machine, Furniture, Computer, Motor Car etc. through a separate cell established at
Head Office in 2009. Total investment in CCS loan stood at Tk.221.56 Million as on
December 31, 2010 against Tk.205.21 Million as on December, 2009.
15. Syndicate / Club Finance
Southeast Bank remains one of the leaders in the banking sector for Syndicated / Club
financing of corporate houses for new project establishment, BMRE
and working capital facilities. The Bank participated in 05 (five)
syndications during 2010 and allowed Tk.1,170 Million in different
Growth of Loans and Advance economic segments like power, sugar, oil, textile, spinning etc.

90,000
Taka in mllion 16. Corporate Finance
80,000 Corporate finance team of Southeast Bank offers client-focused
70,000 corporate banking services to Corporate, Institutional and Business
60,000 Banking clients to meet their specialized requirements in working
50,000 capital, trade and transactional services, foreign exchange and cash
40,000 management to name a few. Southeast Bank provides a wide array
30,000
of banking products which are suitably structured taking into
account the clients risk profile and specific needs.
20,000
10,000 17. Finance in Leather Sector
0 Under guidance of the Leather Sector Business Promotion Council
2006 2007 2008 2009 2010
(LSBPC) of GoB, the Bank, during 2009, devised financing scheme
for the primary producers of Leather Goods, with an initial
allocation of Tk.20.00 Million. The disbursement process has already been initiated and allocation
in the sector shall be increased considering the requirement of the leather goods producers.
18. Agriculture Credit with Special Focus on Cluster Financing
In a country where 48 percent of employment is in agriculture, the Government has
undertaken policy measures to channelize increased agricultural credit by private banks, either
independently or in collaboration with NGOs, hoping to spur domestic food production to
meet the rising domestic demand for food and face the situation against protectionist policies
by food-exporting countries and use of crops to produce bio-fuel. Southeast Bank is
considering cluster financing as a new mode of financing to the Agricultural Sector. Under area
approach method of cluster financing, the Bank is looking for timely, hassle-free and
transparent open disbursement of credit to small farmers through bank accounts opened at a

28 Annual Report - 20 10
Boards Report

nominal deposit. The Bank initiated a model project to finance betel-leaf producers in Patiya
of Chittagong through cluster financing. The model will be replicated to finance other cash
crops like turmeric, ginger etc.
During 2010 Southeast Bank undertook disbursement target of Tk.400.00 million during
2010-2011 in agricultural/ rural credit through banks existing branch networks as well as
linkage with micro finance institutions. In addition to financing to primary producers,
Southeast Bank also allowed significant amount of loans to the Agro processing industries
during 2010. The recently opened SME / Krishi Branches of the Bank are expected to serve
better to the Agro based industries. A new Agri Credit Unit has also been opened at Head Office
to facilitate Agricultural Finance.
19. Export Development Fund (EDF)
Bangladesh Bank established EDF in 1989 to facilitate financing in foreign exchange for
procurement of raw materials by the manufacturer-exporter.
Authorized Dealer branches can borrow US Dollar from Geographical Location-wise Position of Disbursed
Bangladesh Bank through EDF against their foreign currency Loan and Advances %
loan to manufactures / exporters. The current allocation of fund is
USD 300 million. The Bank allowed USD 23.37 million from Dhaka Region 68.44%
the fund during 2010 and the borrowing is expected to increase
further during 2011 commensurate with the increase in export Chittagong Region 26.21%
from the manufacturing sector. Rajshahi Region 1.17%
20. Project Finance and Value Addition to GDP
Sylhet Region 3.11%
From the very inception, Southeast Banks lending policy is
projected to finance the prime sectors contributing more to GDP Khulna Region 1.02%
and 2010 was not any exception. Besides RMG, the Bank has
significant exposure in ceramics, healthcare, sugar, petroleum and Barisal Region 0.05%
infrastructure projects contributing significantly to the GDP of
the country. In the years to come, the bank expects to mobilize
additional financing in new project ventures like agro based industries, jute & jute goods, oil
and petroleum, gas, light engineering products etc.
21. Women Entrepreneurship Fund
Southeast Bank has given utmost emphasis on the growth and flourishing of women
entrepreneurs. With this end view, the Bank has provided 41 (forty-one) entrepreneurs with
necessary credit and outstanding was Tk.177.30 million as on December 31, 2010. The credit
against the fund is expected to grow further in future since more and more women
entrepreneurs are likely to engage in business endeavors.
22. Loan Classification and Provisioning
Loan classification is a process of categorizing the loans based on
their quality/performance /risk associated with and maintaining
required provisions thereagainst on a particular date in protecting
the interest of shareholders/depositors. Southeast Bank Limited
classifies the loans and maintains the required provisions as per
the guidelines of Bangladesh Bank. Our Bank Management is
always vigilant to minimize the classified loans by way of cash
recovery and regularization through rescheduling complying with
the rules and regulations of Bangladesh Bank. As a result, the
Bank could maintain the percentage of classified loans at 4.26 %
as on December 31, 2010.
Besides, Southeast Bank Limited always maintains the required
provisions against classified, unclassified loans and off balance sheet items as per Bangladesh A partial view of a 100% export oriented
Banks guidelines. In 2010 the Bank kept provisions of Tk.3,389.23 million against required modern Readymade Garments Industry
provisions of Tk. 3,105.18 million. (RMG) financed by Southeast Bank
Limited.
23. Credit Monitoring, Early Alert and Management of Non-Performing Loans
Credit Monitoring is a continuous process to maintain and upgrade the health of assets of the
Bank. To secure the interest of the shareholders, depositors and customers, our Bank has
strengthened/intensified its monitoring and follow-up activities in order to maintain quality of
assets and to reduce the NPLs. Primarily, the Credit Administration Department at Head
Office and related Executives/Officers of the branches remain vigilant in monitoring and
following up of overall credit portfolios and timely repayment of the loans. In case, any weak
performing loan is identified, they are grouped under a list called Watch List for close
monitoring and follow up to arrest further deterioration of those accounts. A separate Problem
Account Management Committee headed by the Managing Director is continuously
monitoring the status of problem accounts.

Annual Report - 20 10 29
Boards Report

24. Write-off and Recovery of Classified Loans


Minimizing the amount of non-performing loans through writing-off of bad loans is an
internationally accepted practice to keep the balance sheet sound. The Legal Affairs and
Recovery Department under Credit Risk Management (CRM) Division at Head Office
together with Branch Officers/Executives are continuously monitoring and following up cash
recovery and regularization through rescheduling of classified loans. In the year 2010, the Bank
recovered around Tk.594.78 million from the defaulted borrowers and an amount of Tk.25.73
million has also been recovered from written-off loans.

25. Investment Scenario


The investment portfolio of the Bank during the year 2010 was Tk.18,327.65 million against
Tk.21,350.23 million in the previous year. The portfolio of investment included Government
Treasury Bills, Prize Bonds, Shares of Public Limited Companies etc. The Bank has always
given emphasis on investment of Funds in high yield areas simultaneously maintaining
Statutory Liquidity Requirements (SLR) as fixed by Bangladesh Bank.
Growth in Investment
Taka in million 26. International Trade Operations of Southeast Bank in 2010
25,000
20,000 Southeast Bank has always focused on facilitating its corporate customers with
15,000 state-of-the-art solutions for conducting international trade business. A team of seasoned
10,000 professionals at our 21 Authorized Dealer branches are adequately trained and have the
5,000 expertise to handle the Import and Export Letters of Credit, Foreign Guarantees and
Standby Letter of Credits and Documentary Collections of our valued customers. Apart
2006 2007 2008 2009 2010 from the 21 Authorized Dealer Branches, our non-Authorized Dealer branches located all
over the country are also sufficiently staffed and have the infrastructure to handle
international trade of their corporate customers through the AD branches.

With the combination of experienced foreign exchange professionals, timely and efficient
trade finance solutions and strong infrastructural support, Southeast Bank has seen the
gradual and steady growth in its International Trade activities over the years since its
inception.
Import Trade
In 2010 Southeast Bank has seen another year of sustained growth in its Import Business.
This year the total Import finance of the Bank was Tk. 103,726.7 million (eqvt. USD
Growth of Import & Export Business 1466.10 million) registering a growth of 49% over the Import finance of 2009. Apart from
Taka in million
essential commodities such as Wheat, Sugar and Edible Oil, our other major imported
120,000 items for 2010 were Capital Machineries, Fabrics and Accessories, Scrap Vessel, Live
100,000 Ocean Going Vessel, Steel Billets and Passenger Aircraft.
80,000
60,000
40,000 Year-wise Import Finance Figures of the bank for last 6 years are as below:
20,000
2006 2007 2008 2009 2010 Year Import volume in eqvt. US Import volume in eqvt.
Export Import Dollars (in Million) Taka (In Million)
2005 421.44 29,079.30
2006 501.79 35,125.12
2007 557.50 38,470.34
2008 840.86 58,019.77
2009 1,004.51 69,582.92
2010 1,466.10 103,726.70

Export Trade
Acknowledging the fact that a countrys export sector is the lifeblood for its economy,
Southeast Bank has given utmost thrust to boost the Countrys export sector through
offering prioritized services to the exporters. Since 2003, Southeast Bank has seen a
substantial and consistent growth in its export trade. Despite the aftershock of global
economic downturn, which still persisted in 2010, Southeast Bank registered a sound

30 Annual Report - 20 10
Boards Report

growth in its export finance in 2010. The combined foreign currency inflow from export
and foreign remittance has enabled our Bank in efficient treasury fund management to
settle our import commitments without being dependent on the highly volatile local
inter-bank foreign exchange market in 2010. The major export items of our Bank in 2010
were Readymade Garments, Jute and Jute made goods, Ceramics, Frozen Fish and
Agricultural products.

In 2010 the total export finance of the Bank was Tk.58,158.06 million (equivalent to
USD 822.02 million) which is 24% higher than that of 2009.

Year Export volume in eqvt. US Export volume in eqvt. Country -Wise Inflow of Foreign
Dollars (in Million) Taka (In Million) Remittance through our Bank
2005 202.41 13,511.10 KSA 5%
2006 369.64 25,874.61
2007 423.10 28,771.36 UAE 22% USA
2008 611.28 42,178.60 41%

2009 674.53 46,724.47


2010 822.02 58,158.06 Italy 2%

BB midrate : 70.7497
Oman
27. Inward Foreign Remittance UK 29% 1%

The year 2010 has not been a promising one for the country in remittance business. Against an
increase of 10% for the year 2009, remittance growth fell to 2.2 % for the country in the year
2010. There are a number of factors for this downward trend in remittance. First, the global
depression has been one important reason for the fall in remittance. Second, the manpower
export has also fallen in 2010 that has in turn negatively affected remittance growth.

In the context of the depressing national growth, Southeast Banks remittance business has
grown by 18%. In the year 2009, we brought home Tk. 23,779.20 million in remittance. In
2010, the amount grew to Tk. 28,082.25 million. In bringing home this amount, we have
moved into the sixth place among the private banks in the remittance business. Our share in
the overall remittance business has increased from 3.21% of the market to 3.67%.

In the year 2010, we have strengthened the structure of the remittance business substantially. Inflow of Foreign Remittance
In million USD
450
Abroad, we have entered into business relationship with a number of leading exchange houses 400 402.43
350
in different countries. 300 344.29
250 220.70
193.75
200
Within the country, we have entered into agreement with a number of established NGOs in 150 160.04
100
order to use their outlets for distributing remittance money to the beneficiaries. We have entered 50 11.00 17.32 53.14
0
into these agreements in order to overcome our own weakness where our 66 branches and 10 2003 2004 2005 2006 2007 2008 2009 2010

added towards the end of the year are alone very inadequate for remittance business. As a result
of these agreement, our total outlets for distributing money to the beneficiaries stand at 900.
In anticipation of the usefulness of mobile technology in the remittance business, we have
entered into an agreement with Grameen Phone Limited. Bangladesh Bank has given us
permission to execute the agreement which will be done as soon as Grameen phone receives
the approval of Bangladesh Bank. We are also in discussion with other mobile operators to
enter into agreement with them.

In order to help the expatriates, SEBL has floated a new product that we have named
Probashi Reen. This has been done as part of a DFID (Department for International
Development, UK) aided project under the guidance of Bangladesh Bank and in partnership
with Bangladesh Consultant Limited. The expatriate workers who have jobs abroad and have
received training will be given loan under this scheme at a reasonable rate of interest to pay
the manpower agent to save them from borrowing money from the money lenders at
exorbitant rate of interest, often by selling or mortgaging whatever land or property they
possess. The scheme will also help the expatriate workers to have their documents checked by
the Bank so that they do not become victims of fraud and deceit.

Annual Report - 20 10 31
Boards Report

In order to strengthen the IT base of the remittance business, SEBL has developed its own
software that has been in use since February this year. Overall, the past year has been a
satisfactory one for SEBL as we have been able to strengthen the structure of remittance
business in all the three key areas. In the remittance destination stations, we have taken a few
top remittance houses and banks as our correspondents. In the country, we have strengthened
our distribution channel by taking some very well established and reputed NGOs as
distribution channels to use their network for reaching remittance to the beneficiaries at their
door steps. Finally, we have strengthened the remittance division at the head office by
substantially upgrading its IT base.

28. Foreign Correspondents


Over the years Southeast Bank has continuously developed strong correspondent relationship
with internationally reputed banks to facilitate its foreign trade business. As of 31st December,
2010 the number of foreign correspondents stood at 645 banks in 94 countries of the world.

Our excellent reputation in meeting our commitment and strong financials enabled us in
securing Credit lines (both funded and non-funded) from International Finance Corporation
(a World Bank Group Institution), FMO, of the Netherlands, Asian Development Bank and
other world renowned Banks.
Southeast Bank signed an Agreement with
TMSS on November 09, 2010 for The Bank currently maintains 26 nostro accounts in major international currencies : US
disbursement of foreign remittance through Dollar, Pound Sterling, Swiss Franc, Japanese yen, Australian Dollar, and Euro & Dollar
their outlets across the country.
accounts under Asian Clearing Union with reputed international banks which ensures effective
foreign currency management and timely payment of foreign commitments.

29. SWIFT Operations


Southeast Bank has become member of SWIFT in 2000 to ensure smooth, reliable and secured
financial transactions for its retail and corporate customers. Our SWIFT team consists of one
of the most experienced and trained experts available in the local banking sector. Over the years
our expert SWIFT team has introduced many innovative features in its existing SWIFT
system. In the last quarter of 2010, Southeast Bank Limited SWIFT unit introduced web
based centralized software SWIFT Alliance Messenger SE (SAM) so that all branches can
be hooked up to SWIFT uninterrupted with more than 9,000 Live User Institutions in 210
countries around the world.

30. Treasury Operations and Fund Management


Treasury operation of Southeast Bank Limited is in charge to measure and minimize the risk
associated with Banks liquidity, interest rate, asset liability management and overall fund
management of the bank both in Local and Foreign Currency. The Treasury Division monitors
the direction of the markets, through different modern business techniques and sophisticated
technological support. Besides, our treasury team also managed all the regulatory requirements
like maintenance of CRR, SLR etc in an efficient manner.
Shrimps in the growth process at a hatchery
established by the Banks finance. Due to recent global financial turmoil all the major currencies, commodities and equities
around the world were highly volatile especially during the last quarter of the year 2010. In this
circumstance the main emphasis of our treasury was to maintain adequate risk management for
the bank. Our Treasury Department managed the fund effectively and was able to manage all
the associated risks in the volatile interest rate and liquidity scenario successfully. Treasury
department offered best possible services to its customers and counterparties.

The role of Treasury Division in relation to Foreign Exchange trading is mainly around
currency management trading and market making. The Foreign Exchange desk used money
market transactions in order to borrow / purchase in foreign currencies when necessary,
channeled idle funds into investments / placements and deployed instruments such as swap
and forward contracts in order to manage the Bank's funds effectively. The desk handled
significant amount of Foreign Currencies throughout the year with a reasonable spread
through its widespread branch network.

32 Annual Report - 20 10
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31. Asset Liability Committee (ALCO)


As per Bangladesh Bank guideline, Bank has established a fully functional Asset Liability
Committee (ALCO) for prudent balance sheet risk management. The committee consists of
the Managing Director as the Chairman of the committee, Deputy Managing Directors and
strategically important Divisional Heads of Head Office. The meeting of the Asset Liability
Committee is held every month. The committee reviews interest rate risk and liquidity risk of
the bank and takes necessary steps to mitigate them.

32. Money Market Scenario in 2010


Money market has experienced a turbulent situation in the year 2010. Due to the
contractionary monetary policy, Bangladesh Bank has increased Cash Reserve Requirement
(CRR) twice in this year: at first in May 2010 from 5% to 5.5% and lately in December 2010
from 5.5% to 6% to arrest inflation. The banking sector faced a severe liquidity crunch and
consequently overnight borrowing rate was highly volatile at the end of the year. Apart from
this, Bangladesh Bank raised around Tk.32,000.00 million through issuance of treasury bills
and bonds to mop up excess liquidity from the market. In addition to that a hike in CRR by
50 basis point mopped up around Tk.30,000.00 million from the banking channel; moreover,
A partial operational view of a modern
Bangladesh Banks curb in the Repo market has further tightened the liquidity situation in Ceramic industry financed by the Bank.
the banking sector.

Our bank actively participated in the money market with greater insight and maintaining
utmost professionalism. For the sharp acumen in making investment decisions our bank was
able to minimize the interest rate risk, liquidity risk along with ensuring maximum
profitability in the prevailing volatile market condition. Bank also actively participated in the
secondary transactions of government securities as a Primary Dealer and recorded a substantial
amount of profit from trading activities of the same.

33. Offshore Banking Units


Our two Offshore Banking Units located at Dhaka Export Processing Zone and Chittagong
Export Processing Zone are now fully operational and offer wide array of banking services for
Type A industries including international trade finance, non-resident foreign currency
accounts, working capital loans in foreign currencies at the Export Processing Zones at very
competitive rates. In 2010 our offshore Banking Units registered an income of USD
75,712.23 from discounting of import bills.

34. Information Technology


It is a well established fact that without improvement in technology modern banking sector
can not survive and prosper. Technology is playing an increasingly dominant role in providing Bangladesh Bank Governor, Dr. Atiur
Rahman delivering his speech as Chief Guest
banking products and services. Southeast Bank is continuously upgrading its core banking in presence of SEBL Managing Director
platform and heavily investing to bring about changes in technological infrastructures to keep Mahbubul Alam in the workshop on
its alignment with technology but also to bring efficiency to its operation and ensure Automation in Banking jointly organized
by Southeast Bank Limited and Bangladesh
continuous customer satisfaction. Computer Society on April 1, 2010.

Some of Information Communication Technology (ICT) projects have been initiated in the
year 2010. There were two major developments during the year, first, is the establishment of
the banks state-of-the-art Data Centre (DC) which is an association of various live and
backup servers at its own premises for smooth operation of its Core Banking System (CBS),
second, bank has established Disaster Recovery Site (DRS) at Uttara. Both the DC and DRS
have been constructed by following the standard set out under the tier III of Uptime Institute.
During the year bank has established its own ATM switching system and signed agreements
with Dutch-Bangla Bank Limited (DBBL) and BRAC Bank Limited to access their ATM
Booths.

Annual Report - 20 10 33
Boards Report

An innovative arrangement to collect the motor vehicle taxes and fees on behalf of the
Bangladesh Road Transport Authority (BRTA) through the branches of the Bank across the
country has been launched which is in live operation since last November -2010.
In addition, the bank has also plugged-in smart internet banking service by which client can
get desired banking service from home or a convenient place of his choice which will save
clients time and money.
The Bank has taken initiatives for developing a comprehensive remittance and enquiry
management system to bring automation in the particular field to disburse remittance to its
beneficiary within shortest possible time. The system is in UAT stage and expected to
be live by 1st quarter of 2011.
One noticeable project during the year was joining the Bangladesh Automated Clearing House
(BACH) to participate in Bangladesh Automated Cheque Processing System (BACPS). The
Bank has already delivered MICR (Magnetic Ink Character Recognition) cheque to its valued
customers all over the country. At present the BACPS is in live operation with Dhaka-based
branches and hopefully within the 1st quarter of 2011, depending on the time frame set by
Bangladesh Bank the network will span to the rest of the branches across the country. The real
intention of the project is to diminish clearing instrument settlement time from three days to
one day.
Bangladesh Electronic Fund Transfer Network (BEFTN), another wing of BACH has also
been included to the upcoming operational system of the bank which is in System Integration
Outside view of a Medical College and
Hospital financed by Southeast Bank Limited. Testing (SIT) stage for commencement of service within 1st quarter of 2011. Bangladesh Bank
has initiated the BEFTN project to renovate the payment system structure of the financial
organizations and its stakeholders.
The Bank has also participated in CIB Online Project of Bangladesh Bank to enhance
efficiency for data exchange relating to loans and advances between other financial institutions
and itself. The bank has already incorporated CIB Module with its CBS according to the
specification of Bangladesh Bank which is under UAT stage. The project is scheduled to be
completed by 1st quarter of 2011.
The year 2010 was a constructive year for technological growth of the bank and the bank has
realigned its technology with business objectives and brought about changes for greater
Manpower position for the last 5 years customer satisfaction.
35. Human Resource Division
1800
1600
1400
1200
1000 The most important resource of a financial institution like bank is its manpower i.e. human
800
600
resource. Thus in the modern corporate world, human resource is considered to be a form of
400
200
capital, a produced means of production and the product of investment. Keeping these
0
2006 2007 2008 2009 2010 objectives in mind, the Bank adopted a Human Resource Strategy for recruitment of
employees, acquiring their services, developing their skills, motivating them to high levels of
performance, and ensuring that they continue to maintain their commitment to the
organization to achieve its goals. Southeast bank follows a comprehensive recruitment process
regularly to hire talented, spirited, energetic and dynamic fresh graduates/Masters from
reputed universities. Experienced bankers are also recruited at regular intervals on the basis of
requirement to add more productivity in the day to day work.
The vision and objective of the recruitment in each year is to develop Southeast Banks core
cadre who would be able to take the responsibility as senior executives in future. To support
banks expansion plan and to fill up positions created due to retirement and other
administrative ground, we have recruited 165 Probationary Officer, Trainee Junior Officer and
Trainee Cash Officer during the year of 2010.
Total manpower of the bank as on December 31, 2010 stood at 1613 of which 126 are
executives, 1247 are banking officers and staffs, and 240 are subordinate staff. The bank
recruited a total 318 employees of which 57 were experienced bankers, 165 were fresh entrants
and 96 Bank Guards in 2010. The bank promoted 266 officers during the year 2010. The Bank
arrange orientation program as well as basic training to all fresh entrants to enhance their
competencies in the field of modern Banking.

34 Annual Report - 20 10
Boards Report

Attracting and retaining quality human resource is the most important aspect of human
resource policy. In this regard, the Bank always takes appropriate decisions to design
satisfactory salary structure compared to peer banks and declares a good amount of bonus as
incentive every year. All employes of the Bank works with full enthusiasm in a very congenial
working atmosphere. Everybody enjoys the right to express his own opinion or putting up any
innovative idea to the top management of the Bank. To ensure social security, the Bank has
different staff benefit policies like gratuity, contributory provident fund, encashment of
unavailed leave, etc. The Bank takes appropriate and timely action in all disciplinary cases
keeping conformity with the service rules and regulations of the Bank.

36. Internal Control and Compliance


The Internal Control Framework of the Bank is designed to manage the Banks risks within an
acceptable risk profile to implement the policies and achieve the goals and objectives of the
Bank. It also provides reasonable assurance of effectiveness against material misstatement of
management and financial information or against financial losses and fraud and compliance
with the applicable laws and regulations.

The Board of Directors of the Bank and its different Committees are actively involved in an
ongoing process for identifying, evaluating, monitoring and managing significant risks that
positively affect the achievement of business objectives of the Bank. The Internal Control View of an Ocean Going Vessel procured by
Process which has been instituted throughout the Bank is reviewed and updated from time to Banks finance by the Banks customer.
time in line with the changes in the business environment and this process was in place for the
whole year under review.

The management of the Bank proactively performs the following tasks for mitigating all the
risks associated with the Banks operation and business:

identifying and evaluating the risks to be faced;


formulating related policies and procedures to mitigate these risks;
designing, operating and monitoring a suitable system of internal controls; and
implementing the policies approved by the Board.

Internal Control and Compliance Division, as an independent division of the Bank,


undertakes regular examinations of the Banks operations and monitoring of the systems of
internal control by performing regular reviews of the business processes to examine and
evaluate the adequacy and efficiency of financial and operating controls and highlights
significant risks and non-compliance impacting the Bank. Where applicable, the division
provides recommendations to improve the effectiveness of risk management, control and
governance process. The External Auditors also review the systems of internal control of the
Bank and provide necessary recommendations for improvement. Necessary control measures
are taken according to their recommendations or suggestions.
A partial view of a Betel Leaf Development
37. Products and Services
Program under Micro Credit in Agriculture
In line with the Banks objective to become market leader, Southeast Bank Limited adopted a Sector Financing at Patiya, Chittagong,
customer-oriented service policy and developed diverse products to meet the needs of financed by Southeast Bank Limited.
corporate, commercial and retail customers. That is why the Bank increases its branch network
always to reach all classes of the potential customers of the Bank. In continuation to this, bank
converted its all SME Services Centers into SME/Agri Branches and opened another five new
SME/Agri Branches and five new state-of-the-art branches in the year 2010. In addition, the
Bank also intensified and strengthened its technological infrastructure to ensure that
transactions are executed safely and faster at competitive prices.

38. Budget and Budgetary Control


The Bank follows bottom up planning approach in the preparation of annual budget and
initially invites draft proposals on different budgetary items including deposits, advances,

Annual Report - 20 10 35
Boards Report

by the Head Office Management and reviewed/finalized in the Business Policy and Managers
Conference. After approval in the meeting of the Board of Directors, Banks budget is

achievement of the budget. It periodically reviews the variances and the progress towards
achieving the budgetary goals.
39. Analysis of Income and Expenditure Statements
A brief analysis on Banks income and expenditure in 2010 is given below:
Interest Income
For the year 2010 interest Income of the Bank was Tk.10,257.04 million as against

income growth generated mainly from Loans and Advances which remained the main
contributor.
Interest Expenses
A partial view of a modern Steel and
Re-rolling Mills established by the Banks Total Interest Expenses in 2010 was Tk.7,580.85 million as against Tk. 7,555.99 million in
finance. 2009, posting an increase of 0.33 percent .

Net Interest Income

Tk.1,406.09 million of the previous year.

Investment Income
In 2010, Banks income from investment was Tk.3,788.43 million as compared to
Tk.2,615.82 million of the previous year. Income increased by Tk.1,172.61 million
registering a growth of 44.83 percent. Investment income consists of interest earned and
capital gain on treasury bills and bonds dividend received from shares and gain from
Growth in Total Assets investment in shares.
Taka in Million
150,000 Other Income
100,000
In the year under review, commission, exchange and brokerage earnings increased to
50,000
0
2006 2007 2008 2009 2010 related fee based activity.

Operating Expenses
In the year under review, total operating expenses stood at Tk.1,735.54 million as against
Tk.1,244.55 million of previous year, thus, registering an increase of 39.45 percent.

40. Assets Portfolio

break-up of the total assets are given below:

Taka in Million
a) Cash and Cash Equivalent 10,836.19
b) Investments 18,327.65
c) Loans and Advances 92,452.62
d) Fixed Assets 4,463.08
e) Other Assets 5,863.94
TOTAL : 131,943.48

41. Adoption of IAS and IFRS


International Accounting Standard and International Financial Reporting System have been
adopted by Institute of Chartered Accountants of Bangladesh (ICAB), Bangladesh Bank and

been complied by our Bank in the preparation of the Financial Statements.

36 Annual Report - 20 10
Boards Report

42. Our Contribution to the National Exchequer for the last 5 years

2009 and our contributions to the National Exchequer for the last 5 years are given below:
Year Amount
(Taka in million)
2009 1,550.77
2008 1,252.93
2007 1,217.33
Growth in Operating Profit
2006 882.99
Taka in million
2005 492.14 7,000
6,000
5,000
43. Year-wise Operating Income for last 5 years 4,000
3,000
2,000
1,000
Interest Income, Income from Investment, Commission, Exchange and brokerage and other 0
2006 2007 2008 2009 2010

for the last 5 years is given below.


Year Amount
(Taka in million)
2010 8,490.48
2009 5,859.21
2008 4,039.43
2007 3,817.97
2006 2,721.48
44. Total Lending for the last 5 years

lendings for the last 5 years are given below:


Year Amount Growth
(Taka in million) Rate
2010 92,452.62 19%
2009 77,497.57 29%
2008 60,281.26 25%
2007 48,164.60 17%
2006 41,147.28 26%
A partial of view of a Power Plant established
45. Growth of Operating Profit for the Last 5 years by the Banks finance.

Year Amount Growth


(Taka in million) Rate
2010 6,754.94 46%
2009 4,614.66 53%
2008 3,012.58 3%
2007 2,916.20 41%
2006 2,062.66 40%

46. Return on Equity for last 5 years


During the year 2010, Return on Equity (ROE) of the Bank was 19.41 percent as against

are given below:

20 10
Annual Report - 37
Boards Report

Year Percentage (%) of RoE


2010 19.41%
2009 16.51%
2008 12.06%
2007 19.90%
2006 17.98%

47. Provision for Income Tax

Tk.1,581.58 million of the previous year.


48. Net Profit before Tax and Provision

Provision for Bad and Doubtful Debt, Provision for Off -Balance Sheet Exposures, Taxes etc.
including General Provision on Unclassified Loans and Advances as against Tk.4,614.66
million of the previous year, thus, posting an increase of 46 percent.
49. Net Profit after Provision and Income Tax

A partial view of a 100% export oriented Bad and Doubtful Debt, Provision for Off -Balance Sheet Exposures, Taxes etc. including
sophisticated textile industry established by General Provision on Unclassified Loans and Advances as against Tk.1,870.19 million of the
the Banks finance. previous year, thus, posting an increase of 48 percent.
50. Year-wise Net Profit for the last five years
Net profit of the Bank stood at Tk.2,763.14 million as on 31st December, 2010 as against

for the last 5 years are given below:

Year Amount Growth


(Taka in million) Rate
2010 2,763.14 47.75%
2009 1,870.19 110.80%
2008 887.24 (27.41%)
2007 1,222.97 34.41%
2006 909.88 143.15%

51. Operating Results

any Provision for Bad and Doubtful Debt, Provision for Off-Balance Sheet Exposures, Taxes

the Bank during the year 2009 was Tk.4,614.66 million and thus the Bank attained growth of
Reptiles at the breeding ground of the Export
Oriented Reptile Project set up by the Banks percent and 18 percent respectively in deposit mobilization, loans and advances, imports,
finance. exports, bank guarantee and foreign remittance respectively.
52. Statutory Reserve

provisions before tax and dividend during the year as per Section 24 of the Bank Company

December, 2010.
53. Customer Service
Customers are our first priority and our all endeavors are directed to meet their requirements.
Our core strategy is to build up long term relationship with customers to achieve sustained
growth objectives and increase brand image. It is our motto to provide superior quality
customer service through the integration of the latest state -of- the art technology and to fulfill

excellent, innovative, flawless and speedy solutions to all problems of different customer

38 20 10
Annual Report -
Boards Report

segments and has been widely acclaimed by the business community ranging from small
entrepreneurs to large business conglomerates for excellence in service delivery. Customers, in
a nutshell, are the prime priority for the Bank and the company philosophy is to satisfy clients
who act as ambassadors of the Bank for its image building.

marketing division organogram focuses on customer centric approaches to increase brand

promotional activities and established Brand marketing through Customer Service, CSR,
Event Management, Product Diversification, Positioning and Repositioning etc.

and their profitability in doing Banking business. We have tailored, designed and validated

promotes establishing long term profitable relationship with the clients, providing total
solutions to customer problems and ultimately adds value to the Bank by way of creating a
win-win situation both for the client and for the Bank.

We have introduced diverse range of products and services to cater to the varying needs of all
our valued clients both asset and liability products, retail products, internet Banking, SMS
Banking, online and all branch Banking, Capital Market Services (CMS), SME and Agri
finance etc. We are proud to have satisfied customers from every strata of society, Corporate,
Small and Medium Entrepreneurs and Retail Customers. We meet the demand of all segments
of customers, men and women, professionals and businessmen, resident and non-resident,
public servants and entrepreneurs, homemakers and builders, etc. We are offering our
corporate customers a wide range of banking products and financial solutions to meet their
everyday business needs which include Corporate Credit Products, Treasury Products, Foreign
Trade Finance, Project and Syndicated Loans etc. We are pledge bound to introduce financial
Participant are seen along with the Resource
inclusion products for the under privileged, Green Banking etc. to cater to the emerging socio
Persons at the workshop entitled Islamic
economic priorities of the country. We firmly believe that continuity of our earning good
Banking Module in BankUltimus held on
profit growth, and market share of business depend mainly on our quality of customer service. January 28, 2010 at Banks Training Institute.
54. Research and Development (R&D) and Training

existing position and cope with the ever increasing growth potentials, focuses on making
continuous investment in Research and Development (R& D) and Training to optimize
operational efficiency in raising employee productivity, ensure excellence in banking opera-

manpower with skills and professional expertise. In implementation of the human resources
development strategy, the Bank established a Training Institute in 2005 at the 4th floor of
Head Office premises with the vision to build up professionals with technical, human and

exchange their free ideas, update their knowledge base, and open up their eyes to the

Training Institute in other words, is contributing to capacity build up of human resources,


exploiting their full potentials and update them with latest banking theories and practices.

recording highest per Branch profitability which speaks of highest employee productivity in
the banking sector.

During the year 2010, the Southeast Bank Training Institute arranged a total of 42 training

conducted in 2010 are summarized as follows:

20 10
Annual Report - 39
During the year 2010, the Southeast Bank Training Institute arranged a total of 42 training courses, seminars and
Boards Report

01. Professor Moulana Mohammad Salah-Uddin


Chairman, Shariah Supervisory Committee and Khateeb
Baitul Mukaram National Mosque, Dhaka.
and Former Principal, Madrasha-e-Alia, Dhaka.

02. Mr. A. S. M. Fakhrul Ahsan


Member, Shariah Supervisory Committee and former Deputy Governor,
Bangladesh Bank.

03. Moulana Abdul Hakim Azadi


Member, Shariah Supervisory Committee.
Media personality and Khateeb
Eskaton Garden Jame Mosque
Dhaka.
Under the guidance of Shariah Supervisory Committee, the Bank designed all deposits, investment products and services
of the Islamic Banking Branches and formulated policy guidelines and working procedure. The Bank obtained membership
of the Central Shariah Board of Islamic Banks of Bangladesh and the Islamic Banks Consultative Forum. It has also been
maintaining close relationship with Islamic Banks in Bangladesh and abroad.

As on December 31, 2010, the deposit and investment of Islamic Banking Branches were Tk.993.70 crore and Tk.613.55
crore which posted growths of (3.60) % and 29.71% respectively over those of 2009. During the period 2010, total import
and export business handled by the Islamic banking branches were Tk.323.53 crore and Tk.246.53 crore respectively. Non
Performing Investment of Islamic branches was 0.433 % of their total investment in 2010. The performance of the Islamic
Banking Branches during the year 2010 is also reected in Banks Balance Sheet and Prot and Loss Account as are given
hereafter:

58. Credit Card


Back in 2005, the bank joined the band of Credit Card service providers in the country to meet the emerging demand of
the customers. At that time, a small number of banks were providing the service to a small segment of potential customer
group. As customers get to recognize the benets of using credit cards, the potential market grew bigger triggering entrance
of more banks into card business. Amid sti competition, we have observed our consecutive growth in last ve years both
in customer base and operating income. At the end of the year 2010, our customer base stood at 19,172 which is 44% more
than that of the previous year and operating income grew 20% to reach Tk. 106 million in the same period. Year by year,
we are posting consistent growth to ensure the sustainability of the business in the long run.

In line with our focus, we are in constant eort to ensure that our customers get maximum benet while using SEBL Credit
Card. Throughout the journey; we have congured our card service with all the major applications indispensable in
modern society to make payment at store and to avail quick cash in time of urgent need from anywhere in the world. We
have already introduced Card Cheque and Cash Withdrawal facility from any branch of the bank and SMS Push-Pull
service for transaction alert. Travel Card is our another new product which is a prepaid International Card.

While all the applications and facilities are available in our card service menu, we cannot overlook the signicant role
played by customer service and technological sophistication. Prompt and reliable customer service standard has been set by
our dedicated support team with the most sophisticated technological setup.

Coupled with Credit Card, from last year we have also started to provide own proprietary Debit Card service under our
own processing system to facilitate 24 hrs cash withdrawal to our customers. In 2010, we have already started installing our
own ATM Booths and we are in massive rollout plan to expand our own ATM Network across the country in the years
ahead. Meanwhile, we have established our network connection with DBBL and Brac Platform so that our valued clients
do not miss out cash withdrawal from over thousands of ATMs all over the country.

As number of cardholders is increasing day by day, we are now in a position to segregate the potential market and plan our
products and services according to the needs of dierent segments. To provide elevated service experience to the most
valued and honored citizens of the country, we have a plan to introduce VISA Platinum Card in the next year. With all our
innovative product design and dedicated service delivery the Card Division is contributing to enhance the brand image of
SEBL in the modern technology-based nancial transaction arena.

42 Annual Report - 20 10
Boards Report

59. Branch Expansion Program


The Bank has been operating with 76 (seventy six) Branches tilll
December 2010, out of which 46 Branches are urban including 4
(four) Islami Branches, 15 Branches are rural including 1 Islami
Branch and the rest 15 (fiffteen) are SME/Krishi Branches in
different important locations of the country. Moreover, 2 Off
Shore Banking Units at Dhaka EPZ and Chittagong EPZ are also
performing since 30-12-2009 and 18-04-2010 respectively. The
Bank plans to open 10 more Branches and 10 SME/Krishi
Branch in 2011 to cover more areas with a number of new
products to provide smooth services to the people of the country
subject to obtaining license from Bangladesh Bank.
60. Credit Rating of the Bank
Southeast Bank was rated by Credit Rating Information and Services
Limited (CRISL). The summary of their ratings is given below:
Banks Director A H M Moazzem Hossain is
Name of seen inaugurating Banks Rokeya Sarani
the Rating Particulars Long Term Short Term Remarks Branch at Dhaka City on 30 December, 2010.
Company
Entity AA- ST-2
Rating Double A Minus High Grade Based on
(High Safety) Audited
Financial
Credit Banks rated in this High certainty of
Statement
Rating category are adjudged to be timely payment.
of high quality, offer higher s as of 31
Information Liquidity factors
safety and have high credit December
and Services are strong and
quality. This level of rating 2009 and
Limited supported by good
indicates a corporate entity is valid up
(CRISL) fundamental
with a sound credit profile to April
and without significant protection factors.
26, 2011
problems. Risks are Risk factors are
for long
modest and may vary very small.
term.
slightly from time to time
because of economic
conditions.
Reporting Date: 27th April, 2010
The task of the Credit Rating of the Bank for the year 2010 has been assigned to Credit Rating
Information and Services Limited (CRISL). They have not yet finalized the report. Their
report shall be disclosed in print media and to the regulators as soon as it is received.

61. Implementation of Basel-II and Our Preparedness


Southeast Bank Limited is well placed to implement the Risk
Based Capital Adequacy under Basel-II regime and has
commenced reporting of Minimum Capital Requirement
(MCR) from January 01, 2009 under the guidelines of
Bangladesh Bank in line with the capital adequacy framework
devised by Basel Committee on Banking Supervision. The new
capital framework is intended to foster a strong emphasis on risk
management and is structured on 3 (three) pillars which are (1)
Minimum capital Requirement (2) Supervisory Review Process
and (3) Market discipline.
Basel-II introduces an array of sophisticated credit risk
approaches and a new focus on operational risk. The essential
features of the Basel-II are:
A partial operational view of a modern
A. Three different approaches to calculate Minimum Capital Requirement for Credit Risk. Bi-Cycle Industry financed by the Bank.
B. Capital incentive for banks for moving to more sophisticated credit risk management
approaches based on internal rating.
C. Core disclosure (basic information) and supplementary disclosure to make market
discipline more effective.

Annual Report - 20 10 43
Boards Report

To calculate Minimum Capital Requirement we follow Standardized Approach against Credit


Risk, Standardized Rule Based Approach against Market Risk and Basic Indicator Approach
for Operational Risk. In order to fulfill the regulatory requirement of maintaining minimum
capital, the bank has increased paid up capital to Tk.6.93 billion by issuance of right share
@2:1 amounting to Tk.3.69 billion including premium towards expanding the capital base.
The Bank has also approved issuance of subordinated bond for Tk.2.00 billion to increase the
banks Tier-II capital in the light of additional requirement under the Basel-II framework.
The Bank has stepped up efforts to prudently manage risk weighted assets under the Basel-II
guidelines by expediting credit rating of corporate/ large borrowers from approved external
credit rating agencies which shall be instrumental in efficient and optimum capital management.
The implementation of Pillar-II of Basel-II framework would
perhaps be the most challenging as it requires development of
comprehensive risk model infrastructure to capture all the risks not
covered under Pillar-I of the framework. The Bank has formed a
Supervisory Review Process (SRP) team comprising members from
the senior management approved by the Board which will
participate in dialogues with the SREP team of Bangladesh Bank on
the issue of maintenance of adequate capital to compensate all the
risks associated in the business. The Bank is in the process of
developing an Internal Capital Adequacy Assessment Process
(ICAAP) for capital targets in line with the Banks risk profile and
control environment.
A strong stress-testing framework for sensitivity analysis is in place to
ascertain the ability of the Bank to withstand adverse economic
scenario. The Bank has also put impetus on preparing itself to adapt
A high-tech modern Knit Factory financed by to the advanced methods of risk calculation as per the roadmap of Bangladesh Bank.
the Bank.
62. Corporate Governance
One of the basic policies of the Bank is to strengthen its corporate governance status by
establishing responsible management system and strengthening supervision. Efforts are also
being geared up to improve the transparency and accountability of the management. While
putting efforts to achieve corporate objectives, Southeast Bank gives top priority to establishing
corporate governance standard at all levels and in all units.
The Bank has also implemented the requirements contained in
Securities and Exchange Commission Notification No.
SEC/CMRRCD/2006-158/Admin/02-08 dated February 20,
2006. A comprehensive report about corporate governance scenario
of Southeast Bank Limited is given at page 67.
63. Appointment of Statutory Auditors
In the 15th Annual General Meeting of the company, M/S Rahman
Rahman Huq was appointed External Auditors of the Bank for the
1st term till conclusion of the next Annual General Meeting. They
are eligible to re-appointment in the 16th Annual General Meeting.
64. Dividend
The Bank focuses on the principles of sharing good achievements
with the respected Shareholders. Accordingly, the Board of Directors
recommends 20% Stock Dividend (Bonus Share) and 10% cash
A view of an Inland Cargo Ship procured by dividend for the year 2010. The Banks priority is to increase shareholder value by enhancing
Banks finance by the Banks customer. the overall earnings of the Bank.
65. Election of Directors
In terms of Article 105.(i) of the Articles of Association of the Bank, one-third (1/3rd) of the
Directors for the time being or if their number is not three (3) or multiples of three (3) then
the number nearest to one-third (1/3rd) shall retire from office.
66. Corporate Social Responsibility
Southeast Bank manages its business in a responsible way and contributes to the society and
environment in which it operates. A report on Corporate Social Responsibility of the Bank in
2010 is given at page 77 of this Annual Report.

44 Annual Report - 20 10
Boards Report

67. Acknowledgement

The Board expresses gratitude to the Almighty Allah for the success of the Bank in 2010. The Board extends thanks to the
valued customers, patrons and well-wishers for their continued support and cooperation to the Bank. The Board also places
on record its appreciation for the Senior Management Team, all Executives and other members of the Staff for their
dedicated services to the Bank. The Board offers thanks to the Government of Bangladesh, Bangladesh Bank, Securities and
Exchange Commission, Registrar of Joint Stock Companies and Firms, Dhaka Stock Exchange Limited and Chittagong
Stock Exchange Limited for their appreciable support and co-operation to the Bank. The Board also expresses its apprecia-
tion to M/S. Rahman Rahman Huq, the Auditors of the Bank, for their efforts for timely completion of Audit and prepara-
tion of Financial Statements. The Board of Directors also thanks both the print and electronic media personnel for giving
media coverage to Banks different activities and events.

Finally, the Board thanks the respected Shareholders and assures them that it will continue to add to the shareholder wealth
through further strengthening and development of the Bank in which they have placed their trust and confidence.

On behalf of the Board of Directors.

Alamgir Kabir, FCA


Chairman

Annual Report - 20 10 45
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6.70% wbavib KiQ| 2010 mvji 3q I 4_ gvwmKi gZ A_bwZK cew AevnZ _vKj G jgvv ARb
`y:mva bq|
2010 A_ eQi Kwl LvZ cew eo 4.70% G `uvovq| 2009 A_ eQi G LvZ cewi nvi wQj 4.10%| 2010 A_
eQi wkLvZ cew nvm cq 6% G `uvovq| 2009 A_ eQi G LvZ cewi nvi wQj 6.5%| Drcv`b LvZi cew
2010 mvj nvmcv nq 5.7% G `uvovq hv 2009 mvj wQj 6.7%| 2010 A_ eQi mev LvZi cew wKwr ewcv
nq 6.40% G `uvovq hv 2009 mvj wQj 6.3%|
2010-11 A_ eQii iZ c~eeZx eQii Zzjbvq cewi aviv gvUvgywU mvlRbK wQj| 2010 mvji m^i
g~jxwZ 7.6% G cuQQ| 2011 A_ eQii c_g 4 (Pvi) gvm Ki AvniYi evcK cew AwRZ nq hv c~eeZx
eQijvi Zzjbvq 25.7% ekx| evcK gy`v (Gg-2) AvM-2010 G 22.9% ew cvq| 2009 Gi AvM ewi nvi wQj
19.2%| 2010-11 A_ eQi `ki wRwWwc cew&i jgvv 6.7% DbxZ Kivi j evsjv`k evsK cqvRbxq A_
hvMvbg~jK gy`v bxwZ Mnb Ki| K`xq evsKi 2009-10 mvji evwlK cwZe`b Abyhvqx emiKvix LvZ 2010 mvj
kZKiv 24.2 fvM FYi cewi wecixZ 2011 A_ eQi kZKiv 16.0 fvM FYi cewi jgvv wbq Dbqbeve
gy`vbxwZ cbqY Kiv nq hvZ 2011 A_ eQi g~jxwZ 6.5 fvM wi ivLv me nq|

46 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b
2011 A_ eQii RyjvB-bf^i G 2010 Gi GKB mgqi Pq ivbx 35.8% nvi eo 8.27 wewjqb gvwKb Wjvi
DbxZ nq| GKB mgq `ki Avg`vbxi cewi nvi 35% Gi Dci wQj|
2009 mvj AvnwiZ e`wkK iwgU 11 wewjqb Wjvii wecixZ 2010 mvji c_g 11 gvm AvnwiZ e`wkK
iwgUi cwigvb wQj 10 wewjqb Wjvi| 2010 mvji RyjvB-m^i ch `ki evwYR NvUwZ 1.3 wewjqb Wjvi
evo, weMZ eQi GKB mgqi evwYR NvUwZi cwigvb wQj 739 wgwjqb gvwKb Wjvi|
chv Rvjvbx, AeKvVvgv Ges AwaKZi eemv eve cwiek wbwZ Kiv Mj `ki A_bxwZi 7 fvM ch cew
ARbi gZv iqQ| evsjv`k evsKi 2009-10 mvji evwlK cwZe`b Abyhvqx mve cew ARbi
SzuwKmg~n nQ: evwlK Dbqb cwiKbv cwic~Y evevqbi AwbqZv, we`yyr LvZi cKmg~ni evevqb axiMwZ,
miKvix-emiKvix h_ DMvM Kgm~Px (wcwcwc) cvwZvwbwKKiYi wej^, AvRvwZK I `kxq evRvi Rvjvbx
I Lv` `ei g~j ewi `ib g~j wbqbi cZvwkZ djvdj ARb Kiv Ges Rbkw ivbx I e`wkK gy`v
AvniYi wbgg~Lx ceYZv BZvw`|
03| GK bRi evsKi cwiwPwZ
mvD_B evsK wjwgUW wZxq cRbi GKwU emiKvix evsK wnmve D`vi wek A_bxwZi hyM 1995 mvj cwZwZ
nqQ| eZgvb G evsKi Abygvw`Z gyjab 10,000 wgwjqb UvKv Ges 31k wWm^i, 2010 ZvwiL megvU gyjab
Ges mwwZi cwigvb `vuwoqQ 17,095.90 wgwjqb UvKvq| evsjv`ki bZvbxq evsK wnmve cwZv jvf Kiv Ges
RvZxq A_bxwZZ Zvrchc~Y Ae`vb ivLv Gi j|
BZvga evsK mKj Kvhm~PK cew ARb c~eK 16 eQi evswKs Kvhg mdjZvi mv_ cwiPvjbv KiQ| 2010 mvj
evsKi Ki cieZx gybvdvi cwigvb 2,763.13 wgwjqb UvKv| AvjvP eQi evsKi AvgvbZ 2009 Gi Zzjbvq 11
kZvsk ew cq 107,729.59 wgwjqb UvKvq Ges AMxg 19 kZvsk ew cq 92,452.62 wgwjqb UvKvq DbxZ nqQ|
weMZ 5 eQi (2006-2010) evsK AvgvbZ 23 kZvsk, AMxg 23 kZvsk, ivbxZ 37 kZvsk, Avg`vwbZ 30 kZvsk
Ges e`wkK iwgU 76 kZvsk Mo cew ARb Ki| weMZ 6 eQi ivbxi cwigvY eoQ wZbY hvi cwigvY
58,158.06 wgwjqb UvKv Ges e`wkK iwgUi cwigvY eoQ AvUY hvi cwigvb 28,082.25 wgwjqb UvKv|
mvweK Kvhgi DrKlZvi AvjvK evsK cwiPvjbv Ges YMZ DiY evsKi wbKU mevwaK iZc~Y welq|
eZgvb mviv`k Ryo evsKi 76wU kvLv hvi ga 10wU GmGgB / Kwl kvLv Ges 2wU Ae-kvi evswKs BDwbU
iqQ| fwelZ AviI 10wU kvLv Ges Kgc 10wU GmGgB / Kwl kvLv Lvjvi cwiKbv iqQ|
KwVb evav mI, Drmvn-Dxcbv Ges Kgv`gi mv_ AwaKZi mvdj ARb Avgv`i cPv AevnZ iqQ|
gybvdv ARbi Zxe cwZhvwMZv gvKvejvq Avgiv Avgv`i ` I Awf Rbkwi Dci wbfi Kwi| Avgv`i kw
nQ MvnK`i mv_ Nwb I n`Zvc~Y Askx`vwiZ, `ki eemvwqK I evwYwRKfve iZc~Y vbmg~n Avgv`i `p
Aevb Ges e`wkK evwYR ew K AvRvwZKfve LvZ evsKi mv_ KimcbU evswKs mK | cPwjZ FY
I e`wkK evwYR msv mevmg~n QvovI Avgv`i Abvb mev cYjv nQ Real Time On-Line Any Branch
Banking, Bmjvgx evswKs, gvPU evswKs, Z gy`vi wfmv wWU KvW, GwUGg, wkv FY cK, fvv FY, GmGgB
evswKs, KcviU evswKs, wmwKU FY, wY ew mq cK, gvwmK mq cK, gvwmK gybvdv cK, cbkb mq
cK, IqR Avbvi cbkb wg Ges Gm,Gg,Gm evswKs BZvw`|
AZvaywbK Ges cixwZ evswKs chyw Ges mev cYmg~ni mgw^Z eenvii gvag DbZ MvnK mevB nQ
Avgv`i mdjZvi g~j PvweKvwV| MvnKivB nPQ Avgv`i cavb AMvwaKvi| Avgiv KVvi cwikgi gvag Pv Ki
_vwK MvnK`i GKwU KvDUvi _K m~b evswKs mev cuQ w`Z| MvnK`i Avw_K Pvwn`vmg~n c~iY Avgv`i
Kgxevwnbx bZzb chyw AvZ KiQ, Zv`i mevcYi vb ew KiQ Ges Zv`i `Zvq bZzb gvv hvM KiQ|
MvnK`i cqvRbxq civgk c`vb Ges mwkxj Avw_K Pvwn`vi cQ`bxq Ges ^vPQ`c~Y mgvavb c`vbi gvag
Avgiv kZ ARb wekvmx| Avgiv ckvMZ, bvqwfwK, eyermj Ges vb-wbfi AvPiYi gvag evwYwRK, z`
eemvqx I ewmn mKj aibi MvnK`i mevg MvnK mev c`vb Ki _vwK|
mvD_B evsKK GKwU AvaywbK evswKs cwZvb icvwiZ KiZ Avgiv msKe| Avgiv Avkvev`x G evsKwU ne
Kg Zrci, Kgm~PxZ cMwZkxj, jb`b mZvkxq, wePvi-weePbvq bvqcivqY, gbb fwelgyLx, `wfxZ
wbic Ges MvnKmevq wbew`Z| Avgv`i cwiKbvmg~n evsKi AvaywbK eevcbv, DbZ chywi eenvi,
AwaKZi gybvdv ARb Ges my`p Avw_K wfw I evsKi DP mybvg mwi j cYxZ| evsKi cwiPvjbv cl`i
g~jevb w`K-wb`kbv I Zveavb Ges Avgv`i ` Rbkwi mvweK mnhvwMZvq Avgiv ^Q I `vwqZkxj Kvvbx
eevcbvq AxKvive|

Annual Report - 20 10 47
cwiPvjbv cl`i cwZe`b

mvD_B evsK wjwgUW we`gvb g~jeva I Pjgvb avivi mv_ Zvj iL Ges enr Avw_K cwZvbi mvgvwRK I
cwieki cwZ `vwqZ I iZi cwZ mvb iL evwYwRK Kvhg cwiPvjbv Ki _vK| Mxb evswKs Gi w`K evsK
`Z AMmi nQ| evsK kqvinvvie`K Zzjbvg~jKfve Dg cwZ`vb `Iqvi wbqZv w`Z AvMnx|
04| g~jab I wiRvf
evsKi Abygvw`Z g~jabi cwigvY nQ 10,000.00 wgwjqb UvKv Ges 31k wWm^i, 2010 Bs ch evsKi
cwikvwaZ g~jab wQj 6,930.84 wgwjqb UvKv | AvjvP eQi evsKi g~jab I wiRvfi cwigvY wQj 17,095.90
wgwjqb UvKv hv 2009 mvj wQj 9,927.16 wgwjqb UvKv, G cewi nvi 72.21 kZvsk|
31k wWm^i, 2010 Bs ZvwiL evsKi g~jab Znwej I wiRvfi cwigvY wbgic :

wgwjqb UvKvq
(K) g~j g~jab (Uvqvi-1 g~jab)
cwikvwaZ g~jab 6,930.84
kqvi wcwgqvg wnmve 1,386.17
mswewae wiRvf 3,650.25
mvaviY wiRvf 247.65
msiwZ Avq 1,778.64
gvU g~j g~jab 13,993.55

(L) evowZ g~jab (Uvqvi-2 g~jab)


AkYxKZ FYi Rb msvb 972.20
mve `vqi Dci msvb 554.28
m` c~b:g~jvqb wiRvf 1,064.47
wmwKDwiwUi c~Y:g~jvqbRwZb wiRvf 511.40
GP BKzqvjvBRkb wwZ -
gvU evowZ g~jab 3,102.35
gvU g~jab I wiRvf (K+L) 17,095.90

05| g~jab chvZvi AbycvZ


evsjv`k evsKi evmj-2 wicvwUs Gi AvIZvq evsK wbavwiZ Ab~b 9 fvM g~jab chvZvi nvi Gi wecixZ 31k
wWm^i 2010 G SzuwKc~Y m`i Dci 11.25 fvM g~jab chvZvi AbycvZ eRvq ivL|
06| 2010 mvj c~wRuevRvii mvweK Aevb
2010 mvj cwZvwbK kqvinvvi cavbZ: Avw_K cwZvbmg~n Ges mBmv_ `ki wewfb RvqMvq nvRvi nvRvi
bZzb bZzb z` wewbqvMKvix `ki `ywU cyuwRevRvi KvwU KvwU UvKv wewbqvM Ki| cyuwRevRvi Zvij AvwaKi
cfve ekxifvM Kvvbxi kqvig~j evRvi gjwfwi Zzjbvq AbK ekx ew cvq| 2010 mvj kqvii AwfwnZ
g~j 100 UvKv _K 10 UvKvq cwieZb A_ev AwfwnZ g~j cwieZbi Rei dj z` wewbqvMKvixMY cyuwRevRvi
mswk Kvvbxi kqvi ePv-Kbvq AwaK DrmvwnZ nb| 2010 mvji cyiv mgq Ryo cyuwRevRvii cwZ
wewbqvMKvix`i Avv Divi ew cZ _vK| djkwZZ cyuwRevRvi ksLjv c~btcwZwZ nIqv Ges g~j mskvab
Acwinvh nq co|
2010 mvji kl wWGmB mevP m~PK 8,290.41 cqU cuxQ c~eeZx eQii kl hv wQj 4,535.53| 2010
mvj m~PK 3,750.88 cqU ev 81.71 kZvsk ew cvq| wWGmB Gi cwimsLvb Abyhvqx 5B wWm^i 2010 ZvwiL
cyuwRevRvii mvaviY m~PK mevP 8,918.51 cqU cuxQ| 2010 mvji kl cyuwRevRvi gvU evRvi g~jabi
cwigvb `uvovq 3,508.00 wewjqb UvKv hv c~eeZx eQii H mgq wQj 1,903.20 wewjqb UvKv, G ewi nvi
kZKiv 84.32 fvM|

48 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b

weMZ eQi gvU 25wU Kvvbx Zv`i kqvi Rbmvavibi ga Bmy Kivi Rb cv_wgK MY cve (AvBwcI) ck Ki|
AvBwcI cveKZ gvU kqvii gvU g~j wQj 34,788.10 wgwjqb UvKv| 2010 mvj MY cve ckKvix bZzb 25wU
Kvvbx ZvwjKvf~ nIqvi dj wWGmB Z ZvwjKvf~ Kvvbxi msLv 218 Z `uvovq|
07| mvD_B evsKi kqvi Ges Zvi gvwjKvbv
c~wRuevRvii mKj gjwfw hgb- kqvi cwZ Avq, jfvsk NvlYvi aviv, kqvi cwZ bxU m` g~j, Kvhg cm~Z
bM` cevn, kqvi wcwgqvg wnmvei wwZ, mvavib mwwZ Ges kqvi cwZ Avqi wecixZ evRvi g~j weePbvq Avgv`i
evsKi kqvi kwkvjx Avw_K Aevb cKvk cvq| mvD_B evsKi kqvinvviMb mvlRbK wewbqvMi dj
cvIqvi j wewbqvM wmv Mnbi cye `xNgqv` mZKZvi mv_ chvjvPbv c~eK gjwfw m^wjZ KvvbxZ
wewbqvM Ki _vK|
K) kqvinvvi msLv
Avgv`i evsKi kqvii Dci wecyj msLK kqvinvvi Avv iLQb| 31k wWm^i 2010 ZvwiL evsKi
kqvinvvi msLv `uvovq 66,898 Rb| weMZ eQii G mgq kqvinvvi msLv wQj 22,152 Rb| kqvinvvi
msLvi ewi nvi 202%| bxP c~eeZx cuvP eQi Avgv`i evsKi kqvinvvi msLv ewi Z_ `qv nj :
eQi kqvinvvi msLv ewi nvi
2010 66,898 202.00%
2009 22,152 76.70%
2008 12,536 30.09%
2007 9,636 8.82%
2006 8,855 54.00%
L) kqvicwZ abvZK Avq
2010 mvji kl evsKi cwikvwaZ mvavib kqvii msLv `uvovq 6,93,08,404| `ki Dfq cyuwRevRvi
ZvwjKvf~wi ci _K G ch Avgv`i BmyKZ kqvi 2210.24% ew cvq| evswKs eemv cwiPvjbvi gvag Avgiv
weMZ cuvP eQi hver DjLhvM cwigvY gybvdv ARb KiwQ Ges jfvski DjLhvM Ask mswk kqvinvvi`i ga
eUb KiwQ| Avgv`i Kvvbxi kqvi cwZ DP Avq evsKi jvfRbKZv cKvk Ki| bxP evsKi cuvP eQii kqvi
cwZ Avq `Lvbv nj:
UvKvq
eQi kqvi cwZ Avq
2010 45.20
2009 32.44
2008 31.11
2007 42.88
2006 59.71
M) mvlRbK bxU m` g~j
Avgv`i Kvvbxi kqvii bxU m`g~j _K evSv hvq Kvvbxi gvU m`i cwigvb gvU `vqi Zzjbvq AwaK|
Kvvbxi DPZi bxU m`g~ji KviY AwaK msLK wewbqvMKvix Avgv`i evsKi kqvi wewbqvM KiQb| 2006
mvj _K evsKi bxU m` g~j bxP `Lvbv nj:
UvKvq
eQi bxU m` g~j
2010 247.38
2009 331.01
2008 257.95
2007 269.29
2006 239.47

Annual Report - 20 10 49
cwiPvjbv cl`i cwZe`b

N) Abygvw`Z I cwikvwaZ g~jab


1995 mvj evsK Kvhg i Kivi ci _K Gi Abygvw`Z I cwikvwaZ kqvi g~jabi cwigvb DjLhvMfve
eoQ| eZgvb Avgv`i Abygvw`Z g~jabi cwigvb 10,000 wgwjqb UvKv Ges cwikvwaZ g~jab 6,930.84 wgwjqb
UvKv| bxP 1995 mvj _K evsKi Abygvw`Z I cwikvwaZ g~jabi cwigvb `Lvbv nj :
wgwjqb UvKvq
eQi Abygvw`Z g~jab cwikvwaZ g~jab
2010 10,000.00 6,930.84
2009 10,000.00 3,422.64
2008 3,500.00 2,852.20
2007 3,500.00 2,281.76
2006 3,500.00 2,112.74
2005 2,500.00 1,056.37
2004 2,500.00 880.31
2003 2,500.00 677.16
2002 2,500.00 399.30
2001 500.00 363.00
2000 500.00 330.00
1999 500.00 300.00
1998 500.00 150.00
1997 500.00 125.00
1996 500.00 100.00
1995 500.00 100.00

O) jfvsk Nvlbv
Avgv`i Kvvbxi cwiPvjbv cl` kqvinvvi`i Rb AwRZ gybvdv _K DPnvi jfvsk Nvlbv Ki _vK| m
KviY Avgv`i evsKi kqvinvviMY kqvi cwZ mvlRbK jfvsk cq _vKb| bxP 2006 mvj _K evsKi
NvwlZ bM` jfvsk I gyjabx jfvski nvi `Lvbv nj :

eQi bM` jfvsk g~jabx jfvsk gvU jfvsk


2010 10% 20% 30%
2009 - 35% 35%
2008 15% 20% 35%
2007 15% 25% 40%
2006 20% 8% 28%

P) evsKi ivBUm& kqvi Bmy


mvD_B evsK 2003 mvj we`gvb 2wU kqvii wecixZ 1wU kqvi AbycvZ 16,50,000 wU ivBUm& kqvi Bmy Ki|
evsK cybivq 2006 Bs mvj 1,05,63,696 wU ivBUm& kqvi Bmy KiQ| 2006 mvj cwZwU 100 UvKvi kqvi 100
UvKv wcwgqvgmn 200/- UvKv Bmy g~j Bmy Ki| evsK mekl 2010 mvj 60/- UvKv wcwgqvgmn 160/- UvKv g~j
2,31,02,801 wU ivBU kqvi Bmy Ki|

50 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b

Q) GK bRi mvD_B evsKi kqvii ewkmg~n


1) wecyj msLK kqvinvvi|
2) fvj I mvlRbK jfvski nvi|
3) abvZK kqvicwZ Avq|
4) kqvicwZ fvj bxU m` g~j|
5) 'G' kYxf~ kqvi wnme `ki Dfq cuywRevRviB jb`b nQ|

08| AvgvbZ
evsK 31k wWm^i 2010 ch 107,729.59 wgwjqb UvKv AvgvbZ msMn KiQ hv 2009 mvj wQj 96,669.05
wgwjqb UvKv| cwZhvwMZvg~jK my`i nvi, evsKi AvgvbZ msMni KvhKi cPv Ges evsKi Dci MvnK`i Avv
AvgvbZi G DjLhvM AMMwZZ Ae`vb iLQ| evsK z` I gvSvwi mqKvix`i Rb ek wKQz AvKlYxq mq
cK Pvjy KiQ| mq cKmg~n ay AvgvbZi cwigvb ew Kiwb, AvgvbZi bMZ gvbiI cwieZb NwUqQ| 31k
wWm^i, 2010 ZvwiL evsKi AvgvbZ wgkY wQj wbgic :

wgwjqb UvKvq %
K) PjwZ I Abvb AvgvbZ 10,048.97 9.33%
L) mqx AvgvbZ 5,773.71 5.36%
M) ^ bvwUk AvgvbZ 7,877.81 7.31%
N) vqx ev gqv`x AvgvbZ 79,836.86 74.11%
O) wewfb cKi AvIZvq msMnxZ AvgvbZ 2,846.02 2.64%
P) c`q weji wnmve LvZ 1,346.21 1.25%
gvU: 107,729.59 100.00%

09| FY bxwZgvjv
mvD_B evsK wjwgUW Ljvcx FY SuywK Kgvbvi j evsjv`k evsKi wb`kbv AbymiY Ki GKwU myy FY weZiY
bxwZgvjv Zix I evevqb KiQ | GB FY weZiY bxwZgvjvq eni cwimi GKwU cwigvwRZ FY weZiYi hveZxq
welqvewj hgbt AMvwaKvi LvZ mg~n wPwZ Kiv, Abygv`b cwqv, `wjjvw` mv`b Ges Z`viwK I cwi`kb Af~
Kiv nqQ|
AwaKy, LvZwfwK wekl cqvRbxq FY hgb cwievii Rb fvv FY, Mn wbgvb FY, Mvox q FY, GmGgB FY, Kwl
FY Ges mxwgZ cwimi PvgovRvZ cY mvgMx ZixKviK`i Rb FYi Abygv`b I weZiYi Avjv`v bxwZgvjv Zix Kiv
nqQ|
10| FY I AwMg
2010 mvj Avgiv `ki A_bxwZZ wewfb Dvb cZb `LwQ| eQii gvSvgvwS mgq _K `ki cuywRevRvi Avgiv
bwRiwenxb Pvvfve cZ KiwQ hv kl PZz_vsk Gm KgZ i KiQ| 31k wWm^i, 2009 mvj gvU FY
cvUdwjIi cwigvY wQj 77,497.57 wgwjqb UvKv hv 19% ew cq 31k wWm^i, 2010 mvj 92,452.62 wgwjqb
UvKvq DbxZ nqQ| Zix cvkvK, e, is, wmivwgK, Jla, UwjKwgDwbKkb, cUvwjqvg, BvZ, cKkj, RvnvR
fvv wk, wmgU, fvR Zj, wPwb wk, wiqj GU, cwienb, Kwl I Abvb eemvqxK LvZ wewbqvM Kivi gvag
Kvb wbw` LvZ K`xf~Z bv Ki FYi egyLx eenvi wbwZ Kiv nqQ|

Annual Report - 20 10 51
cwiPvjbv cl`i cwZe`b

11| cwiPvjK FY
2009 mvj evsKi cwiPvjKMY evsK _K Kvb bZzb FY Mnb Kibwb|
12| MvivwU eemv
evsK 2009 mvji 11,916.70 wgwjqb UvKvi wecixZ G eQi gvU 22,781.19 wgwjqb UvKvi MvivwU Bmy Ki|
evsKi mvwbZ MvnK`i Ave`bg wewfb miKvix KZc, gYvjq, ^vqZkvwmZ cwZvb, Kcvikb, eweM,
emiKvix Kvvbxmg~n Ges eRvwZK Kvvbxmn wewfb cwZvbi AbyK~j MvivwU Bmy Kiv nq|
13| GmGgB A_vqb
miKvi I evsjv`k evsKi bxwZgvjvi mv_ GKgZ cvlY Ki GKwU MwZkxj GmGgB LvZ Zwi Avgv`i GKwU
AMvwaKvi wfwK KvR| 2010 mvji 31k wWm^i ch mviv `k gvU 10 wU bZzb GmGgB/Kwl mvwfm mUvi vcb
Ki hv ciewZZ GmGgB/Kwl kvLvq icvi Kivi gvag GB LvZ FY weZiYi KvhgK eMevb Kiv nqQ|
31k wWm^i, 2010 ch Avgv`i evsKi gvU GmGgB/Kwl kvLvi msLv 15wU| 2009 mvji 31k wWm^i
GmGgB LvZ gvU FYi wwZ wQj 8884.30 wgwjqb UvKv hv 2010 mvj 47.01% ew cq UvKv 13060.67
wgwjqb DbxZ nq|
GmGgB LvZ Aviv AwaK A_vqb Kivi Rb bZzb bZzb FY cY Pvjy Kiv I GB LvZ Aviv ekx cwigvY A_
wewbqvMi K_v AwaK ZrciZvi mv_ weePbv Kiv nQ| cyivZb XvKvi PvgovRvZ `e ZwiKviK`i QvovI mve Q
A_vqbi Rb UvsMvBji vbxq ZuvZx`i K_v Avgv`i evsK iZi m weePbv KiQ| GB Kvhgi AvIZvq
Zv`i Avw_K cqvRb wgUvevi Rb BZvga cqvRbxq mgxvi KvR kl Ki Abvb Kgm~PxI Zwi Kiv nqQ|
14| fvv FY
fvv FY cvwievwiK / ZvmvaviYi cqvRbxq wewfb wRwbm c hgbt iwdRviUi, Uwjwfkb, Iqvwks gwkb,
Avmevec, ewMZ Mvox BZvw` q Kivi Rb c`vb Kiv nq| GB FY 2009 mvj MwVZ cavb Kvhvjqi GKwU wekl
BDwbU viv cwiPvwjZ nq| 31k wWm^i, 2009 mvj GB LvZ c` FYi gvU wwZ wQj 205.21 wgwjqb UvKv hv
31k wWm^i, 2010 mvj 7.96% ew cq 221.56 wgwjqb UvKvq DbxZ nq|
15| wmwKU A_vqb
mvD_B evsK wjwgUW wmwKU A_vqbi gvag wewfb KcviU nvDRi bZzb cK evevqb, weGgAviB I PjwZ g~jab
mieivn Kivi evswKs LvZ AMYx f~wgKv cvjb Ki AvmQ| 2010 mvj Avgv`i evsK 5wU wmwKU A_vqbi
gvag wewfb wk LvZ hgbt we`yr, wPwb, ZjRvZ, e I myZv BZvw` LvZ gvU 1170 wgwjqb UvKv weZiY KiQ|
16| KcviU A_vqb
mvD_B evsKi ` Kgxevwnbx wewfb cvwZvwbK MvnK`i Pvwn`v I cqvRbi mv_ mvgmc~Y wewfb A_vqb, hgb:
PjwZ g~jab, jb`bi cwic~iK mevmg~n, e`wkK gy`vi jb`b, A_ eevcbv cfwZ mev w`q _vK|
17| Pvgov LvZ A_vqb
evsjv`k miKvii Leather Sector Business Promotion Council (LSBPC) m 2009 mvj, Avgv`i evsK cv_wgKfve
20 wgwjqb UvKv eUb Kivi j GB LvZ FY weZiY Kvhg i KiQ| BZvga PvgovRvZ `e cyZKviK`iK
FY weZiY Kiv i nqQ Ges cqvRb Abyaveb Ki FY weZiY Aviv evoe ej Avkv Kiv nQ|
18| Q A_vqbi gvag Kwl FY
`ki 48% gvbylB RxweKvi Rb Kwli Dci wbfikxj| `ki geagvb Lv` Pvwn`v, Lv` kmi gvag Re Rvjvbx
Zwi I Lv` ivbx KviK `ki iYkxj bxwZgvjv gvKvejvi j `ki Lv` Drcv`b ewi Avkvq miKvi evwYwRK
evsKjvi wbR^ Zveavb Ges emiKvix cwZvbi gvag AwaKcwigvb Kwl FY weZiY wbwZ Kivi Rb cqvRbxq
bxwZgvjv Zwi KiQ| Avgv`i evsK KwlLvZ FY weZiYi Rb Q A_vqbK GKwU bZzb cwZ wnmve MnY KiQ|
GB Kvhgi AvIZvq Avgv`i evsK mvgvb wWcvwRUi gvag wnmve Lvjvi myweav c`vb Ki mgqgZ, evavnxb I ^Q
FY weZiYi cwZ bRi w`qQ| Avgv`i evsK Q A_vqbi gvag cwUqvq cvb Pvlx`i gvS FY weZiY Kvhg i
KiQ| Abvb g~jevb km hgb njy`, Av`v BZvw` Pvl Kivi Rb GKB FY weZiY cwZ AbymiY Kiv ne|
mvD_B evsK wjwgUW 2010-2011 mvj wbR^ kvLv Ges z` FY cwZvbi mnhvMxZvq 40 KvwU UvKv Kwl I cjx
FY weZiYi jgvv wbaviY KiQ| cvwK Drcv`bKvix`i A_vqb QvovI Avgv`i evsK 2010 mvj Kwl FYi

52 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b

GKwU eo Ask Kwl wfwK wki Rb Abygv`b KiQ| Avgiv Avkv KiwQ mcwZ Lvjv GmGgB/Kwl kvLv mg~ni
gvag Kwl wfwK wk A_vqb Kvhg Aviv Rvi`vi ne| Kwl FY c`vbi Rb cavb Kvhvjq GKwU Avjv`v
BDwbU BZvga Kvhg i KiQ|
19| ivbx Dbqb Znwej
ivbxKviK`i cqvRbxq KuvPvgvj we`kx gy`vq q Kivi Rb evsjv`k evsK 1989 mvj ivbx Dbqb Znwej bvg
GKwU wekl Znwej MVb Ki| Abygvw`Z wWjvi kvLv mg~n ivbxKviK`i we`kx gy`vq FY c`vb Kivi Rb GB Znwej
nZ gvwKb Wjvi FY MnY KiZ cvi| eZgvb GB Znweji cwigvb 300 wgwjqb gvwKb Wjvi| Avgv`i evsK 2010
mvj GB Znwej nZ gvU 23.37 wgwjqb gvwKb Wjvi weZiY KiQ hv 2011 mvj Drcv`b LvZi ivbx ewi Rb
Aviv ew cve ej Avgiv Avkvevw`|
20| cK A_vqb I wRwWwcZ Ae`vb
i _KB mvD_B evsK wjwgUW wRwWwcZ Zzjbvg~jK ekx Ae`vb ivL Ggb LvZ A_vqb Ki AvmQ Ges 2010
mvjI Zvi ewZg wQj bv| Zwi cvkvK QvovI wRwWwcZ iZc~Y f~wgKv ivL GiKg AbK LvZ Avgv`i wewbqvM
iqQ hvi ga iqQ wmivwgK wk, ^v mev LvZ, wPwb wk, cUvwjqvg, wiqj GU, AeKvVvgvMZ Dbqb BZvw`|
AvMvgx eQi jvZ Avgv`i evsK bZzb cK wekl Ki Kwl wfwK wk, cvU I cvURvZ`e, Rvjvwb / cUvwjqvg,
Mvm I jvBU Bwwbqvwis LvZ Aviv A_vqbi welqwU iZi mv_ weePbv KiQ|
21| gwnjv D`vv Znwej
mvD_B evsK wjwgUW gwnjv D`vv`i eemvq cmvi I mgwi evcvi mevP iZ c`vb KiQ| 31k
wWm^i, 2010 mvj ch Avgv`i evsK 41 Rb gwnjv D`vvi gvS FY weZiY KiQ| D LvZ gvU wwZi
cwigvY 177.30 wgwjqb UvKv| gwnjv D`vv`i eemvqxK Kvhg w`bw`b mcmvwiZ nIqvq GB Znwej AvMvgx
eQi jvZ evovbv ne ej Avgiv Avkvev`x|
22| FY kYxKiY I msvb msiY
evsKi Z_v kqvinvvi I AvgvbZKvix`i ^v_ iv_ FYi YMZgvYi wfwZ FYmg~ni kYxwebvmKiY Ges Zvi
wecixZ cqvRbxq msvb msiY Kiv GKwU AZxe iZc~Y eev| evsjv`k evsKi bxwZgvjv Abyhvqx mvD_B
evsK FYmg~n kYxKiY I cqvRbxq msvb msiY Ki _vK| kYxKZ FYmg~n _K bM` Av`vq I Dchy
evsjv`k evsKi wbqg cwicvjb Ki cyb:ZdwmwjKiYi gvag weic kYxKZ FY nvmKiY evsK eevcbv KZc
me`v mRvM| djkwZZ, wWm^i 2010 G evsKi kYxKZ FYi nvi 4.26% G mxwgZ ivLv me nqQ|
cvkvcvwk evsjv`k evsKi bxwZgvjv Abyhvqx kYxKZ / AkYxKZ I wwZc ewnf~Z AvBUgmg~ni wecixZ cqvRbxq
msvb msiY Kiv nQ| 2010 mvj evsK KZK cqvRbxq msvb 3,105.18 wgwjqb UvKvi wecixZ 3,389.23
wgwjqb UvKv msiY Kiv nqQ|
23| FY cheY, AvMvg mZKZv I AmvlRbK FYmg~ni eevcbv
FYi YMZgvb eRvq ivLv I Zv Dbqbi j FY cheY GKwU Pjgvb cwqv| Avgv`i evsKi mvwbZ MvnK,
kqvinvvi I AvgvbZKvix`i ^v_ iv_ c` FYmg~ni YMZgvb eRvq ivLv I kYxKZ FYi cwigvY nvmK
wbqwgZ cheY I Zveavb Kiv nq| g~jZ: cavb Kvhvjqi wWU GvWwgwbkb wWcvUgU Ges kvLv chvqi mswk
KgKZvMY mgw^Z nq c` FYmg~n mgqgZ Av`vqi Rb wbqwgZ cheY I Zveavb weklfve Zrci _vK| Kvb
FYi `~ejZv cwijwZ nj D FYmg~ni GKwU ZvwjKv (Watch List) cZ KiZ: Zv wbweofve cheYi gvag
weickYxKZ nIqv _K weiZ ivLZ Zviv weklfve mP _vKb| eevcbv cwiPvjKi bZZ cavb Kvhvjqi
DaZb chvqi KgKZv`i mg^q MwVZ GKwU wekl KwgwU `~ej cKwZi / AmvlRbK FYmg~n wbqwgZ cheY I
Zveavbi gvag Dnvi YMZ gvbvbqb me`v mP AvQ|
24| FY Aejvcb Ges kYxKZ FYi wecixZ Av`vq
Kz-FY Aejvcbi gvag kYxKZ FY nvm I evjvmxU mg ivLv GKwU AvRvwZKfve ^xKZ eev| kYxKZ
FYmg~n _K bM` Av`vq I wbqwgZKiYi wbwg wWU wi gvbRgU wWwfkbi wjMvj Avdqvm G wiKfvix
wWcvUgU I kvLv chvqi mswk wWcvUgUi KgKZve` hyMcrfve wbqwgZ cheY I Z`viwK Ki AvmQ| 2010
mvj evsK kYxKZ FYi wecixZ 594.78 wgwjqb UvKv bM` Av`vq KiQ Ges AejvcbKZ FYi wecixZ 25.73
wgwjqb UvKv bM` Av`vq KiQ|
25| wewbqvM
evsKi wewbqvMi cwigvb AvjvP eQi wQj 18,327.65 wgwjqb UvKv hv MZ eQi wQj 21,350.23 wgwjqb UvKv |
wewbqvM gvagjvZ Af~ wQj miKvix URvix wej, cvBR e, cvewjK wjwgUW Kvvbxi kqvi BZvw`| evsK
me`v DP gybvdv mbLvZ wewbqvM Ges evsjv`k evsK KZK wbavwiZ hyMcr wewae Zvij AbycvZ eRvq ivLvi Dci
AwaKZi iZ Avivc Ki |

Annual Report - 20 10 53
cwiPvjbv cl`i cwZe`b

26| mvD_B evsKi AvRvwZK evwYR Kvhg 2010


mvD_B evsK me`vB Zvi KcviU MvnK`i AvRvwZK evwYR mv`bi Rb hyMvchvMx I Awfbe eemvwqK
mgvavb I mev c`vb Ki AvmQ|
evsKwUi 21wU kvLv e`wkK Kvhg mv`bi Rb evsjv`k evsKi Abygv`bcv Z_v Authorized Dealer (AD) |
GB 21wU AD kvLvq chv msLK Awf I cwkYcv Rbej iqQ hviv evsKi mvwbZ MvnK`i Avg`vbx I ivbx
evwYR, e`wkK MvivwU, vevB FYc, WKzgUvix KvjKkvbm BZvw` mev `Zvi mv_ c`vb Ki AvmQ| GB
21wU AD kvLv QvovI `kevwc Qwoq _vKv Avgv`i Abvb cvq me kvLvq chv Rbej I chywMZ AeKvVvgv we`gvb
hv Zv`i KcviU MvnK`i e`wkK evwYR Ab AD kvLvi gvag myPvifve mb KiZ mvnvh KiQ|
e`wkK evwYR Kvhg Awf Rbkw, mgqvchvMx Ges KvhKix evwYwRK mev Ges kwkvjx chywMZ
AeKvVvgv GB mei mg^q m~Pbv jM _KB mvD_B evsK AvRvwZK evwYR geagvb nvi DjLhvM cew
jvf Ki AvmQ|
Avg`vbx evwYR
Abvb eQii gZv 2010 mvjI mvD_B evsK Avg`vbx evwYR A_vqb DjLhvM mvdj jvf KiQ| GB eQi
evsKwU gvU 103,726.70 wgwjqb UvKvi (BDGm Wjvi 1466.10 wgwjqb) Avg`vbx evwYR A_vqb KiQ hv 2009
Gi Avg`vbxi Zzjbvq 49% AwaK|
Riix Lv`km hgb Mg, wPwb, fvRZj BZvw` QvovI 2010 mvj mvD_B evsK KZK A_vqbKZ cavb
Avg`vbx cYwj nQ g~jabx hcvwZ, 100% ivbxgyLx wki KuvPvgvj, vc RvnvR, mgy`Mvgx RvnvR I
hvxevnx DovRvnvR|
evsKi MZ Qq eQii Avg`vbx evwYRi ZvwjKv

eQi Avg`vbx evwYRi cwigvb Avg`vbx evwYRi cwigvb


BDGm Wjvi (wgwjqb) UvKv (wgjqb)
2005 421.44 29,079.30
2006 501.79 35,125.12
2007 557.50 38,470.34
2008 840.86 54,019.77
2009 1,004.51 69,582.92
2010 1,466.10 103,726.70

ivbx evwYR
mvD_B evsK me`vB Abyaveb Ki AvmQ h GKwU `ki ivbx wk nQ mB `ki cvYkw| GB gbvfveK
mvgb iL, evsKwU `ki ivbx wk DrKl mvabi j mevP iZ Avivc Ki ivbxKviK`i DbZi I
Awfbe mev c`vb Ki AvmQ| 2003 mvj _KB evsKwUi ivbx evwYR geagvb cew cwijwZ nq AvmQ|
wekevRvi A_bwZK g`vi bwZevPK cfvei KviY 2010 mvj `ki ivbx wk wKQzUv weiZv _vKv mI
mvD_B evsK 2010 mvj ivbx evwYR A_vqb mvlRbK cew jvf KiQ|
2010 mvj mvD_B evsKi gvU ivbx A_vqb wQj 58,158.06 wgwjqb UvKv (BDGm Wjvi 822.02 wgwjqb) hv
2009 mvji ivbx A_vqbi Zzjbvq 24% ekx|
evsKi MZ Qq eQii ivbx evwYRi ZvwjKv

eQi ivbx evwYRi cwigvb ivbx evwYRi cwigvb


BDGm Wjvi (wgwjqb) UvKv (wgjqb)
2005 202.41 13,511.10
2006 369.64 25,874.61
2007 423.10 28,771.36
2008 611.28 42,178.60
2009 674.53 46,724.47
2010 822.02 58,158.06

54 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b

e`wkK gy`vi AgyLx cevn hv h_fve evsKi iwgUv I ivbx evwYR _K AwRZ nqQ Zv evsKwUi
e`wkK Avg`vbx `vq kvai j e`wkK gy`v eevcbvq AZ KvhKixfve AwwZkxj e`wkK gy`v
evRvii Dci evsKwUi wbfikxjZv ejvsk nvm KiQ| GB eQi evsKwUi cavb ivbx cYwj nQ Zix
cvlvK, cvU I cvURvZ cY, wmivwg cY, wngvwqZ gvQ I Abvb KwlRvZ cY|
27| e`wkK iwgUv AvniY
e`wkK iwgUv msMni Rb weMZ 2010 mvj Avgv`i `ki Rb h_ mdj wQj bv | G 2009 mvji
Zzjbvq cew AwRZ nqQ gv 2.2 kZvsk | wek g`vev I Rbkw ivbx nvm cvIqv GB bwZevPK cewi KviY
ej aiv nQ |
iwgUv LvZ RvZxq cew nvm cjI mvD_B evsK 18 kZvsk cew ARb mg nqQ Ges 2010 mvj
28,082.25 wgwjqb UvKvi mgcwigvb e`wkK iwgUv AvniY Ki evsKwU gvKU kqvi 3.21 kZvsk _K 3.67
kZvsk DbxZ KiQ|
2010 mvj mvD_B evsK `k I we`k iwgUv AvniY I weZiY bUIqvK ewi j weki kxlvbxq KwZcq
GP nvDRi mv_ Pzwe nqQ Ges vbxqfve ^bvgab KqKwU GbwRIi mv_I iwgUv weZiY Pzw
mv`b KiQ| GQvov gyVvdvbi gvag DcKvifvMxi nvZ iwgUvi A_ cuuQ `Iqvi Rb, `k cwiPvwjZ
eng gvevBj dvb AcviUi, Mvgxb dvbi mv_ Pzw mv`b KiQ | GmKj eev evsKwUi iwgUvi A_
mvavib gvbyli nvZ `Z, mnR I wbivc` cuuQ `Iqvi mgZv ew KiQ |
` Rbkw ivbx DrmvwnZ Kivi wbwg mvD_B evsK `wi` RbMvxK A_vqbi Rb cevmx FY bvg GKwU wekl
FY mev Pvj~ KiQ | mvD_B evsK wekvm Ki cevmx FY mevwU we`kMvgx `wi` RbMvxK evnviv nIqv _K
iv Ki, HmKj cwievii gyL nvwm dvUvZ Dj f~wgKv ivLe| mnbxq gvvi my`i nvi, mnR kZ, b~bZg
WKzgUkbi Rb cevmx FY mevwU h_ RbwcqZv cve ej Avkv Kiv nQ |
DbZ I gvb mb chywi gvag AwaKZi MvnK mev wbwZ KiZ mvD_B evsK GKwU bZzb iwgUv mwjDkb
md&UIqvi Pvjy KiQ | hvi dj mvwbZ DcKvifvMxiv `Z, mnR I wbivc` iwgUvi A_ Mnb KiZ mg
neb| Avi MvnK mevi DrKlZvq AvgivI GKavc GwMq _vKe |
28| e`wkK cwZm (Correspondent) mK
evswKs Kvhgi m~Pbv _KB e`wkK evwYRi mvdji Rb mvD_B evsK wbijm cPvq AvRvwZK
LvwZmb evsKwji mv_ kwkvjx cwZm mK Mo ZzjQ| 31k wWm^i 2010 ch 94wU `ki 645wU
evsK, mvD_B evsKi cwZm wnme Afy nqQ|
e`wkK gy`vq Avg`vbx `vq cwikva Avgv`i Azb mybvg Ges kwkvjx A_bwZK Aevb Avgv`iK International
Finance Corporation (IFC), Asian Development Bank (ADB) FMO (Netherland Finance Company) Ges Abvb
LvwZmb AvRvwZK evsKwj nZ Funded Ges Non-Funded Credit Line ARb KiZ mnvqZv KiQ| mvD_B
evsK iZc~Y 6wU e`wkK gy`vq ^bvgab AvRvwZK evsKwji mv_ eZgvb 26wU bv GKvDU Pvwjq hvQ|
GB e`wkK gy`vwj nQ BDGm Wjvi, cvD, BDiv, RvcvwbR Bqb, myBm dvb&K Ges Asian Clearing Union Gi
Aaxb Wjvi I BDiv| 6wU iZc~Y gy`vq Lvjv 26wU bv GKvDU evsKwUi e`wkK Avg`vbx `vq myzfve cwikva
Ges Afixb dv eevcbvq AZ iZc~Y f~wgKv cvjb Ki AvmQ|
29| SWIFT Kvhg
mvD_B evsK Zvi MvnK`i wbiwewQb, wbfihvM I wbivc` A_bwZK jb`b myweavi j 2000 mvj SWIFT
(Society for Worldwide Interbank Financial Telecommunication) Gi m`m c` Mnb Ki| evsKwUi SWIFT Unit
`ki evswKs RMZi AbZg miv Awf I cwkYcv Rbeji mg^q MwVZ| cwZ eQiB evsKwUi SWIFT Unit
chywMZ DrKlK KvR jvwMq SWIFT Network Gi mv_ bZzb bZzb Feature hvM Ki SWIFT mevK Aviv
mnRZi I DbZ Ki AvmQ| 2010 mvji kl fvM evsKwUi SWIFT Iqe wbfi Centralized Software SWIFT
Alliance Messenger (SAM) Gi Afy nqQ hvi dj evsKwUi SWIFT m^wjZ mKj kvLv wbiwewQbfve 210wU
`ki 9000 cwZvbi mv_ Live mshywZ mg nqQ|
30| URvix Kvhg I Znwej eevcbv
mvD_B evsKi URvix wefvM evsKi vbxq, e`wkK g~`vi jb`b, Zvij SzuwK nvm, my`i nvi nvm, m` I
`vq eevcbv Ges mevcwi Znwej eevcbv cwigvc I Zvi SzuwK nvm Ki _vK| AvaywbK eemvqxK cwZ I DbZ
chywi mnvqZvq evRvii w`K wb`kbv wbYqi gvag G wefvM KvhKix f~wgKv cvjb Ki| GQvovI Avgv`i URvix
wUg CRR (Cash Reserve Requirement), SLR (Statutory Liquidity Requirement) msiY mn mKj wewae wbqg
myyfve gb PjQ|
weklZ 2010 mvji klva wek A_bwZK g`vi KviY cavb e`wkK gy`v, cY Ges kqvi evRvi wQj AZ
AwwZkxj| GB cwiwwZZ SzuwK eevcbvB wQj URvixi g~j j| URvix wefvM G AwwZkxj my`i nvi I Zvij
cwiwwZZ Ges Znwej eevcbv I Zvi AvbylwK SzuwK gvKvejvq KvhKix f~wgKv cvjb KiQ| URvix wefvM Zvi

Annual Report - 20 10 55
cwiPvjbv cl`i cwZe`b

e`wkK g~`v evwYRi URvix wefvMi cavb f~wgKv nQ gy`v eevcbv, jb`b I evRvi Zix Kiv| dib
GP W cqvRb Abyhvqx q/weq, AeeZ Znwej wewbqvM Ges wewfb cwZZ, hgb SWAP, AwMg Pzw
(Forward Contract) Gi gvag evsKi Znweji KvhKix eenvi wbwZ KiQ| GB W mviv eQi evsKi weZ
kvLvi gvag DjLhvM cwigvY e`wkK gy`v jb`b KiQ|
31| m` I `vq KwgwU (ALCO)
evsjv`k evsKi bxwZgvjv Abyhvqx, wwZci SzuwK `fve eevcbvi Rb evsKi GKwU c~Y KvhKix m` I `vq
KwgwU (ALCO) iqQ| G KwgwU evsKi eevcbv cwiPvjK, Dc-eevcbv cwiPvjKMY Ges cavb Kvhvjqi
KkjMZ fve iZc~b wefvMxq cavb`i wbq MwVZ| m` I `vq KwgwUi mfv cwZgvm AbywZ nq| G KwgwU
evsKi my`i nvi SzuwK I Zvij SzuwK chvjvPbv Ki Ges SzuwK nvmi cqvRbxq eev MnY Ki|
32| 2010 mvji gy`vevRvi
2010 mvj gy`vevRvi GKwU Awi mgq AwZg KiQ| gy`vmsKvPb bxwZi KviY evsjv`k evsK bM` msiY nvi
G eQi `yBevi cwieZb KiQ; c_gevi g 2010 mvj 5% _K 5.50% Ges mekl wWm^i 2010 mvj 5.50%
_K 6.0% G DbxZ Ki| G KviY evswKs LvZ cP Zvij msKU co, hvi djkwZZ eQii kl w`K Kjgvwb
my`i nvi wQj AZ AwwZkxj| ZvQvov evsjv`k evsK miKvix wmwKDwiwURi wbjvgi gvag cvq 32,000.00
wgwjqb UvKv evRvi _K Dvjb KiQ| Zv mI, bM` msib nvi 50 ewmm cqU evovbvi dj evswKs LvZ
_K AviI cvq 30,000.00 wgwjqb UvKv DvwjZ nqQ; GQvovI evsjv`k evsKi icv gvKU wbqY evswKs
LvZi Zvij msKUK AviI Nbxf~Z KiQ|
Avgv`i evsK AZ wePbZv I ckv`vwiZi mv_ gy`vevRvi mwqfve AskMnY KiQ| AZ wePb wewbqvM
wmvi dj Avgv`i evsK GB SzwKc~b evRviI my`i nvi I Zvij SzuwK wbqb iL mevP Avq wbwZ KiQ|
GQvov evsK cvBgvix wWjvi wnme miKvix wmwKDwiwURi q-weqI mwqfve AskMnY KiQ Ges G
_KI DjLhvM cwigvY gybvdv ARb KiZ mg nq|
33| Adkvi evswKs BDwbU (OBU)
mvD_B evsKi `yBwU Adkvi evswKs BDwbU hv XvKv I PMvg BwcRW Aj AewZ, GLb m~bfve Zv`i
Kvhg Avi KiQ| GB BDwbU `ywU BwcRW Aj AewZ UvBc 'A' cwZvbwjK bvbv cKvii evswKs myweav
c`vb KiZ cvi hgb: AvRvwZK evwYR mev Avg`vbx I ivbx, Non-Resident Foreign Currency (NFCD) GKvDU,
e`wkK gy`vq IqvwKs KvwcUvj A_vqb BZvw`| evsKwUi Adkvi evswKs BDwbUmgyn GB mKj myweav AZ
AvKlbxq g~j mnRZi kZ c`vb Ki _vK| 2010 mvj Avgv`i Adkvi BDwbU Avg`vbx wej discounting Gi
gvag 75,712.23 BD Gm Wjvi Avq KiQ|
34| Bbdigkb UKbvjwR
GK_v Ab^xKvh h, chywi Dbqb ewZZ AvaywbK evswKs LvZK wUwKq ivLv Ges Gi mvweK Dbqb me bq| evswKs
mevZ chyw geagvb nvi AMYxf~wgKv cvjb Ki hvQ| mvD_B evsK AvaywbK chywi mv_ mvgm iL
evswKs mev Ges MvnK mwi avivevwnKZv wbwZ ivLZ Kvi evswKs Gi AeKvVvgvMZ Dbqb I chywi DrKl
chv wewbqvM Ki hvQ|
2010 mvj evsK Z_ I hvMvhvM chyw (ICT) LvZ ek KqKwU cK MnY KiQ| Gi ga AbZg nQ evsKi
wbR^ feb GKwU AvaywbK WvUv mUvi (DC) vcb hLvb wbiwewQb fve Kvi evswKs wmg (CBS) cwiPvjbvi
cwiek mw Kiv nqQ Ges wZxqwU nQ Divq wbR^ feb wWRvvi wiKvfvwi mvBU (DRS) vcb| Dfq
Uptime Institute Gi Tier III Gi wbwZgvjv K Abymib Kiv nqQ|
GB ermi evsK Zvi wbR^ ATM Switching System vcb KiQ Ges WvP&-evsjv I evK evsKi mv_ Zv`i ATM
eenvii Dk Pyw ^vi KiQ|
evsKi AviKwU bZzb D`vM MnY nQ wewfb kvLvi gvag evsjv`k ivW UvcvU A_wiwU (BRTA) Gi c gUi
Mvoxi Ki I wdm MnYi eev hv MZ eQii bf^i _K i nqQ|
AwaK, evsK Zvi mev mg~ni ga BUvibU evswKs mev mshy KiQ hv _K MvnKe` Ni A_ev AbKvbv
myweavRbK vb nZ wKQz evswKs mev Mnb KiZ cvie| Gi dj MvnKe`i A_ I mgqi mvkq ne|
MvnKi wbKU h_v me `Z iwgU mev c`vbi j evsK iwgU G BbKvqix gvbRgU wmg bvgK
GKwU cK Pvjy KiQ hv cixvg~jK chvq iqQ Ges AvMvgx 2011 mvji ga hv MvnK chvq Pvjy ne|
GB ermi AviKwU DjLhvM cK nQ evsjv`k AUvgUW PK cmwms wmg (BACPS) G AskMnb| GB j
evsK BZvga evsjv`k AUvgUW wKqvwis nvDR (BACH) Gi mv_ hy nqQ| BZvga evsK mviv`k mvwbZ
MvnK`i gvS Magnetic Ink Character Recognition (MICR) PK weZiY KiQ| eZgvb BACPS XvKv wfwK kvLv
mg~n Pvjy nqQ Ges evsjv`k evsK Gi mgqmxgv Abyhvqx 2011 mvji gvP gvmi ga XvKvi evBi AewZ Aewk
kvLv mg~n GB mev Pvjy ne| GB mevi g~j Dk nQ PK wKqvwis Gi mgqmxgv Kwgq Avbv|

56 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b

(BACH) Gi AviKwU kvLv evsjv`k BjKUwbK dv Uv&dvi bUIqvK (BEFTN) mev| eZgvb Zv cixvgyjK
chvq iqQ Ges Avkv Kiv nQ 2011 mvji ga Gi Kvhg i ne| evsjv`k evsK Avw_K cwZvb mg~ni ga
Avw_K jb-`b KvVvgvi Dbqbi Rb GB mev Pvjy KiQ|
FY mwKZ Z_ Av`vb c`vb AvaywbKiYi Rb evsK BZvga evsjv`k evsK Gi CIB Online cKi mv_ hy
nqQ| GB j evsK BZvga Zvi Kvi evswKs wmg (CBS) Gi m CIB gwWIj mshy KiQ hv eZgvb
cixvg~jK chvq iqQ Ges 2011 mvji ga GB cK mgv ne|
2010 mvj wbtm`n evsKi Rb KvwiMix I chywMZ Dbqbi ermi Ges eemvwqK Dk I MvnK e`i eni
mwi K_v wPv Ki evsK Zvi chywK hyMvchvMx KiQ Ges GB aviv AvMvgxZI AevnZ _vKe|
35| gvbe m` wefvM
evsKi gZ GKwU Avw_K cwZvb gvbe m`K mevwaK GKK iZc~Y Ges wnZKi kw wnme weePbv Kiv nq|
eZgvb KcviU RMZ my` gvbe m`K GK cKvii g~jab wnme weePbv Kivi cvkvcvwk G mKj cKvi
eqK Drcv`bi j wewbqvM wnme Mb Kiv nq| GB aviYvK mvgb iL Ges mevwaK cew ARbi j
mvD_B evsK GKwU mgw^Z gvbe m` msMn Ges Dbqb Kkj Mnb KiQ| evsK wbwZ h, DbZ gvbe m`
Kkj Aej^bi gvag DrK gvbi KgPvix msMn, Zv`i `Zv ew, mRbkxjZv, AvbyMZ Ges evsKi cwZ `p
AxKvi jvf mg_ ne|
mvD_B evsKi gvbe m` cwiKbvi g~j wfw njv wbR^ ` gvbe m` mw| G j mvD_B evsK me`v
GKwU mgw^Z bxwZi gvag gvbe m` msMn Ki| 2010 mvj evsKi eemv mcmviY, Aemi MnY Ges Abvb
ckvmwbK Kvib m c` c~ibi j mvD_B evsK wewfb c` 165 Rb m` cvk Kiv Zib/ZibxK KgKZv wnme
wbqvM c`vb KiQ|
31 k wWm^i 2010 ZvwiL evsKi Rbej 1613 Rb wMq cQ Za 126 Rb wbevnx, 1247 Rb KgKZv Ges
240 Rb Abvb KgPvix| 2010 mvj evsK 318 Rb KgKZv/KgPvix wbqvM `vb KiQ Zvi ga 57 Rb Awf
evsKvi, m` cvk Kiv 165 Rb Ges 96 Rb evsK MvW| GQvov evsK 2010 mvj 266Rb KgKZvK c`vbwZ c`vb
KiQ|
hvMZv mb gvbe m` msMn, wbqvM Ges AevnZ fve ai ivLv gvbe m` bxwZi GKwU AZ iZc~b welq|
G mvD_B evsK memgq Zvi mgchvqi evsKi mv_ wgj iL DP eZb I Drmvn evbvm c`vbi gvag
KgKZv/KgPvix`iK ciYv hvMvq| evsKi mKj KgKZv GKwU my`i I mnv`c~Y Kgcwiek Drmvn-Dxcbvi mv_
KvR Ki AvmQ| cZK KgPvix Zv`i wbR^ gZvgZ I mRbkxj aviYvmg~n evsKi DaZb KZci mv_
Lvjvgjvfve AvjvPbv KiZ cvi| KgKZv`i mvgwMK wbivcv wbwZ KiZ evsK wewfb aibi KgPvix KjvY
bxwZgvjvi AvIZvq MvPzBwU, fwel Znwej, AfvMKZ QywU bM`vqb, BZvw` myweav c`vb Ki _vK| GQvovI evsKi
gvbe m` wefvM kLjv fi NUbvi m~ mgvavbK evsKi PvKzix wewagvjv Abymvi mwVK I mgqwPZ c`c MnY
Ki _vK|
36| AfixY wbqb I cwicvjb
evsKi AfixY wbqb KvVvgvK Ggb fve mvRvbv nqQ, hvZ evsKi SuywK cZvwkZ mxgv ev gvvq iL Gi
hveZxq bxwZ, Dk I j ARb Kiv me nq| GQvovI GUv eevcKxq I Avw_K Z_ mwKZ evcK fzj-vw A_ev
Avw_K wZ I Rvj-RyqvPzwii wecixZ Ges c` wewaweavb mg~ni cwicvjbi welq djc` bvqmZ wbqZv c`vb
Ki|
AwaK, evsK Zvi mev mg~ni ga BUvibU evswKs mev mshy KiQ hv _K MvnKe` Ni A_ev AbKvbv
myweavRbK vb nZ wKQz evswKs mev Mnb KiZ cvie| Gi dj MvnKe`i A_ I mgqi mvkq ne|
MvnKi wbKU h_v me `Z iwgU mev c`vbi j evsK iwgU G BbKvqix gvbRgU wmg bvgK GKwU
cK Pvjy KiQ hv cixvg~jK chvq iqQ Ges AvMvgx 2011 mvji ga hv MvnK chvq Pvjy ne|
GB ermi AviKwU DjLhvM cK nQ evsjv`k AUvgUW PK cmwms wmg (BACPS) G AskMnb| GB j
evsK BZvga evsjv`k AUvgUW wKqvwis nvDR (BACH) Gi mv_ hy nqQ| BZvga evsK mviv`k mvwbZ
MvnK`i gvS Magnetic Ink Character Recognition (MICR) PK weZiY KiQ| eZgvb BACPS XvKv wfwK kvLv
mg~n Pvjy nqQ Ges evsjv`k evsK Gi mgqmxgv Abyhvqx 2011 mvji gvP gvmi ga XvKvi evBi AewZ Aewk
kvLv mg~n GB mev Pvjy ne| GB mevi g~j Dk nQ PK wKqvwis Gi mgqmxgv Kwgq Avbv|
evsKi cwiPvjK cl` Ges Gi wewfb KwgwU Zvrchc~Y SzuwK mg~ni wbavib, g~jvqb, Z`viwK Ges eevcbv msv
Pjgvb cwqvq mwqfve AskMnb Ki _vK, hv evsKi eemvwqK jmg~n ARb BwZevPK f~wgKv ivL| cwiewZZ
eemvqxK cwiwwZK gvwbq Pjvi j evsKi me we`gvb AfixY wbqb cwqvK mgq mgq chvjvPbv I
mgqvchvMx Kiv nq Ges G cwqv AvjvP eQi mgM mgq ai AevnZ wQj|

Annual Report - 20 10 57
cwiPvjbv cl`i cwZe`b

evsKi cwiPvjbv I eemvqi mv_ RwoZ SuywK mg~ni ckgb Kivi j evsKi eevcbv KZc AZ mwqfve
wbgv Kvhg mb Ki _vKt
mve mKj SuywK wbaviY I g~jvqb Kiv;
D SuywKmg~ni ckgbi j h_vh_ bxwZ I cwqv mg~n cYqb Kiv;
GKwU Dchy AfixY wbqb Kkj cYqY, evevqb ev cwiPvjb I Z`viwK Kiv; Ges
cl` KZK Abygvw`Z bxwZmg~ni evevqb Kiv|
evsKi GKwU ^vaxb wefvM wnme BUvibvj KUvj G Kgcvq wWwfkb evsKi Avw_K I cwiPvjbMZ wbqbi
chvZv I KvhKvwiZv hvPvB I g~jvqbi j evsKi `bw`b cwiPvjb Kvhg I eemvwqK cwqvmg~ni wbqwgZ
chjvPbvi gvag AfixY Kkj mg~ni Z`viwK Ki Ges evsKi Dci cfveweviKvix SuywK I cwicvjb-wePzwZmg~n
iZmnKvi Dcvcb Ki| chvR Zviv SuywK-eevcbv, wbqb I mykvmb cwqvi KvhKvwiZv cmvi mycvwik
ck Ki| ewn:wbixKMYI evsKi AfixY wbqb Kkj mg~n chvjvPbv Ki Ges Zvi kwkvjxKib cqvRbxq
mycvwik ck Ki| Zv`i mycvwik I civgk gvZveK cqvRbxq wbqY Kvhg cwZv Kiv nq|
37| cY I mevmg~n
c_g mvwii AMMY evsK nIqvi j mvD_B evsK wjwgUW MvnKgyLx mevbxwZ MnY Ges KicviU, Kgvwkqvj I
wiUBj MvnK`i Pvwn`v wgUvZ bvbvgyLx mev Pvjy KiQ| GB cwicwZ mve meaibi fvvi KvQ cuQvZ evsK
cwZwbqZ Zvi kvLv ew Ki PjQ | GiB avivevwnKZvq 2010 mvj evsK Zvi mejv SME mev c`vb K`K Gm
Gg B/Kwl kvLvq cwiYZ KiQ Ges bZzb cvuPwU Gm Gg B/ Kwl kvLv I AvaywbK mKj myhvM-myweav mcb cvuPwU bZzb
kvLv Pvjy KiQ | GQvovI `Z, wbivc` I cwZhvwMZvg~jK LiP jb`b mb Kivi j evsK Zvi chywMZ
AeKvVvgv AwaKZi kwkvjx KiQ|
38| evRU Ges evRU wbqY
evsK KZc Dag~Lx cwiKbv AbymiY (bottom up planning approach) Ki wewfb kvLvmg~n _K evRUi
LvZmg~ni (hgb AvgvbZ, AwMg, jvf, eemv BZvw`) cv_wgK cvebv Avnvb Ki| cavb Kvhvjqi eevcbv KZc
kvLvmg~ni Dcvmg~n mg^q Ki evrmwiK evRUi Lmov Zix Ki eemvwqK bxwZ I eevcK mjb AvjvPbvi
gvag evRU Zix mb Ki| evsKi cwiPvjbv cl`i Abygv`bi ci evRU evevqbi Rb kvLvmg~n ciY Kiv
nq| evsK eevcbv KZc mviveQi evRUi wecixZ wewfb jgvv ARbmg~n wek`fve chvjvPbv Ki hvZ Ki
evRUi jmg~n AwRZ nq|
39| Avq I eqi LvZIqvix weklY
evsKi Avq I eqi Dci GKwU msw weklY wbg `qv njv :
my` _K Avq
2010 mvj mvD_B evsKi my` _K Avqi cwigvb wQj 10,257.04 wgwjqb UvKv, hv 2009 mvj wQj
8,962.09 wgwjqb UvKv, cewi nvi 14.45% | G cewi bc_ iqQ evsK _K `qv FY I AwMg|
my` c`vbi Rb eq
AvjvP eQi my`i Rb eq wQj 7,580.85 wgwjqb UvKv hv 2009 mvj wQj 7,555.99 wgwjqb UvKv, cewi nvi
0.33% |
bxU my` Avq
evsKi bxU my` Avq 2010 mvj `vovq 2,676.19 wgwjqb UvKv hv MZ eQi wQj 1,406.09 wgwjqb UvKv |
wewbqvM nZ Avq
MZ 2010 mvj mvD_B evsKi wewbqvM _K Avqi cwigvb wQj 3,788.43 wgwjqb UvKv hv 2009 mvj wQj
2,615.82 wgwjqb UvKv| G LvZ cwZe`bKvjxb eQi Avq 44.83% A_vr 1,172.61 wgwjqb UvKv ew cvq |
wewbqvM _K Avqi Dcv`vb wQj URvix wej I ei Dci my`, kqvii jfvsk Ges g~jabx Avq|
Abvb Avq
AvjvP 2010 mvj, Kwgkb, wewbgq Ges `vjvwj _K Avq nqQ 1,700.99 wgwjqb UvKv, hv MZ 2009 mvj wQj
1,644.22 wgwjqb UvKv| gyjZ: ewaZ eemv Ges wd-wfwK KgKv _K G Avq GmQ|
cwiPvjb eq
2009 mvj gvU cwiPvjb eq wQj 1,244.55 wgwjqb UvKv hv kZKiv 39.45 fvM eo 2010 mvj nqQ
1,735.54 wgwjqb UvKv |

58 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b

40| m`i cvUdwjI


31k wWm^i, 2010 Bs ZvwiL evsKi gvU m`i cwigvb wQj 131,938.09 wgwjqb UvKv | evsKi gvU m`i
wgkY wQj wbgic :
wgwjqb UvKvq
bM` I bM` mgZzj 10,836.19
wewbqvM 18,327.65
FY I AwMg 92,452.62
vqx m` 4,463.08
Abvb m` 5,863.94
gvU m` 131,943.48
41| AvB.G.Gm Ges AvB.Gd.Avi.Gm. Gi KvhKvwiZv cm
BUvibvkbvj GKvDwUs vvW Ges BUvibvkbvj dvBbvbwkqvj wicvwUs wmg, BwUwUDU Ae PvUvW GKvDUUUm&
Ae evsjv`k (AvBwmGwe), evsjv`k evsK Ges Gm.B.wm KZK MnxZ nqQ | Avgiv Avgv`i Avw_K weeiYx cZ
Kivi Dciv bxwZgvjv I cwZ cwicvjb KiwQ |
42| RvZxq KvlvMvi AvqKi wnmve Rgv
2009 mvj RvZxq KvlvMvi AvqKi wnmve Rgv w`qQ 1,550.77 wgwjqb UvKv | evsKi weMZ cvuP ermii RvZxq
KvlvMvi AvqKi wnmve Rgvi cwigvb wbgic :
eQi wgwjqb UvKvq
2009 1,550.77
2008 1,252.93
2007 1,217.33
2006 882.99
2005 492.14

43| weMZ cvuP eQii Kvhg cm~Z Avq


2010 mvj Kvhg cm~Z Avq wQj 8,490.48 wgwjqb UvKv hvi ga wQj bxU my` Avq, wewbqvM nBZ Avq, Kwgkb,
GP I `vjvjx Ges Abvb Avq | 2009 mvj Avq wQj 5,859.21 wgwjqb UvKv hv kZKiv 45 fvM eoQ |
evsKi weMZ cvuP ermii Kvhg cm~Z Avq wbgic:
eQi wgwjqb UvKvq
2010 8,490.48
2009 5,859.21
2008 4,039.43
2007 3,817.97
2006 2,721.48

44| weMZ cvuP ermii gvU AwMgi cwigvY


evsKi AwMgi cwigvb MZ eQii 77,497.57 wgwjqb UvKv _K kZKiv 19 fvM nvi eo AvjvP eQi
92,452.62 wgwjqb UvKvq DcbxZ nq | evsKi weMZ cvuP ermii gvU AwMgi cwigvY wbgic:
eQi wgwjqb UvKvq cewi nvi
2010 92,452.62 19%
2009 77,497.57 29%
2008 60,281.26 25%
2007 48,164.60 17%
2006 41,147.28 26%

Annual Report - 20 10 59
cwiPvjbv cl`i cwZe`b

45| Kvhg cm~Z gybvdv jvf weMZ cvuP eQi cew


G eQi evsK 6,754.94 wgwjqb UvKv Kvhg cm~Z gybvdv ARb Ki| 2009 mb evsKi Kvhg cm~Z gybvdv wQj
4,614.66 wgwjqb UvKv | evsKi weMZ cvuP ermii Kvhg cm~Z gybvdvi cwigvb wbgic:
eQi wgwjqb UvKvq cewi nvi
2010 6,754.94 46%
2009 4,614.66 53%
2008 3,012.58 3%
2007 2,916.20 41%
2006 2,062.66 40%

46| weMZ cuvP eQi BKyBwUi Dci Avqi nvi


evsKi BKzBwUi Dci Avq AvjvP eQi nq 19.41 kZvsk hv MZ eQi wQj 16.51 kZvsk| evsKi weMZ cvuP eQi
BKzBwUi Dci Avqi nvi wbgic :
eQi wiUvb Ab BKzBwU (%)
2010 19.41%
2009 16.51%
2008 12.06%
2007 19.90%
2006 17.98%

47| AvqKii Rb msvb


evsK AvjvP eQi AvqKii Rb msvb wnmve iLQ 2,160.10 wgwjqb UvKv hv 2009 mvj wQj 1,581.58
wgwjqb UvKv |
48| msvb I Ki c~eeZx gybvdv
G eQi evsK weZiYKZ AkYxKZ FYi Dci msvbmn Kz-FY Ges m`nRbK FY, wwZc ewnfyZ `dvmgyn, AvqKi,
BZvw`i Dci cqvRbxq msvb msiYi c~e 6,754.94 wgwjqb UvKv gybvdv ARb Ki| 2009 mb evsKi Ki
c~eeZx gybvdv wQj 4,614.66 wgwjqb UvKv Ges evsKi gybvdvq cewi nvi 46% eRvq wQj |
49| msvb I Ki cieZx gybvdv
G eQi evsK weZiYKZ AkbxKZ FYi Dci msvbmn KzFY Ges m`nRbK FY, wwZc ewnf~Z `dvmgyn, AvqKi,
BZvw`i Dci cqvRbxq msvb msiYi ci 2,763.14 wgwjqb UvKv gybvdv ARb Ki | 2009 mb evsKi Ki I
Abvb msvb cieZx gybvdv wQj 1,870.19 wgwjqb UvKv Ges evsKi gybvdvq cewi nvi 48% eRvq wQj |
50| bxU gybvdv jvf weMZ cvuP eQi cew
G eQi evsK 2,763.14 wgwjqb UvKv Kvhg bxU gybvdv ARb Ki| 2009 mb evsKi Kvhg bxU gybvdv wQj
1,870.19 wgwjqb UvKv Ges bxU gybvdv cewi nvi 48%| evsKi weMZ cvuP ermii bxU gybvdvi cwigvb wbgic:

eQi wgwjqb UvKvq cewi nvi


2010 2,763.14 47.75%
2009 1,870.19 110.80%
2008 887.24 (27.41%)
2007 1,222.97 34.41%
2006 909.88 143.15%

60 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b

51| Kvhg cm~Z djvdj


G eQi evsK weZiYKZ AkbxKZ FYi Dci msvbmn Kz-FY Ges m`nRbK FY, wwZc ewnf~Z `dvmgyn, AvqKi.
BZvw`i Dci cqvRbxq msvb msiYi c~e 6,754.94 wgwjqb UvKv cwiPvjb cm~Z gybvdv Avq Ki| 2009 mvj
evsKi cwiPvjb cm~Z gybvdvi cwigvb wQj 4,614.66 wgwjqb UvKv Ges evsKi gybvdvi cewi nvi 46% eRvq wQj|
evsK weMZ eQii Zzjbvq AvgvbZ, AwMg, Avg`vbx, ivbx, MvivwU Ges e`wkK iwgUv G h_vg 11%, 19%,
49%, 24%, 91% Ges 18% cew ARb Ki |
52| msiwZ Znwej
evsK Kvvbx Gv 1991 Gi 24 aviv Abyhvqx wewfb msvb ivLvi ci Ges AvqKi c`vb I jfvsk NvlYvi c~e
gybvdvi 20% A_vr 984.65 wgwjqb UvKv msiwZ Znwej vbvi Kiv nqQ| DjL, 31k wWm^i, 2009 ZvwiL
gvU msiwZ Znweji cwigvb `uvwoqQ 3,650.25 wgwjqb UvKvq|
53| MvnK mev
MvnK`i cqvRbB Avgv`i cavb AMvwaKvi Ges Avgv`i mKj cPv wbwnZ iqQ mivmwi Zv`i mKj mgmv
mgvavbi Rb| Avgv`i g~j Kkj nQ MvnK`i mv_ `xNw`bi mK Mo Zvjv hvi gvag weivgnxb mgw Ges
Kvvbxi fveg~wZ evovbv hvq| mevrK chywi wbiwewQb eenvii gvag mevP MvnKmev c`vb Ges `Zv,
mwkxjZv I AvwiKZvi gvag MvnK`i mgmv gUvbvB Avgv`i g~j j| Avgiv mKj kYxi MvnK`iK AvaywbK
DbZ I zwUgy evswKs mev `~ZZvi mv_ cuQ w`Z AxKvive Ges eemvwqK `~i`w I MvnK`i wbZbZzb mgmv
mgvavbi Rb Avgiv eemvwqK mgvR evcK cksmv ARb KiwQ| GK K_vq MvnKMY evsKi AMvwaKvi Ges Kvvbx
`kb nQ MvnK`i m Kiv hviv evsKi fveg~wZ ewZ `~Z wnme KvR Ki |
cwiewZZ wekvqbi cwicwZ mvD_B evsK weKwkZ wecYb KgKvi gvag bZzb Pvj gvKvejv I
cwZhvwMZvq wUK _vKvi Rb mnvqK cvwZvwbK KvVvgv MVb KiQ| eemv eve evsK wnme fveg~wZ ewi j
mvD_B evsK MvnKKw`K welq weePbvq iL gvKwUs wefvMi AMvbvMvg cybMVb KiQ| geagvb wecYb KgKv
I DbZ MvnKmev, mvgvwRK `vqeZv, BfU gvbRgU, cY bevqb Ges cY cwRkwbs I wicwRkwbs BZvw`i gvag
evi fveg~wZ ew KiZ mP iqQ|
mvD_B evsK cY wew Kibv eis cY wecYb Ki hvZ evswKs eemvi MvnKMYi mw Ges gybvdv mevP
nq| g~jevb MvnK`i Pvwn`v c~ib Avgiv Avgv`i cY I mevi gvb bZzbZ wbq GmwQ| GUv `xNvqx MvnK mK
vcbi mv_ mv_ MvnK`i c~bv mgmv mgvavbi wbqZv w`Q Ges Aekl evsK Zvi wbRi I MvnKi Rb
jvfRbK Aev mwZ AMMvgx iqQ hv evsKi g~jevaK Aviv weKwkZ KiQ|
Avgiv MvnK`i wbZ bZzb Pvwn`v weePbv Ki wewfb cYi m` I `vq cYmg~n, LyPiv cYmg~n, BUvibU evswKs,
Gm.Gg.Gm. evswKs, AbjvBb Ges mKj kvLv evswKs, g~jab evRvi mev, GmGgB Ges Kwl A_vqb BZvw`i mgvnvi
NwUqwQ hvZ Avgv`i MvnK`i mKj cKvi wbZ bwgwK Pvwn`v c~iY nq| Avgiv Meeva Kwi h mgvRi mKj ii
KcviU, z` I gvSvwi D`vv, LyPiv MvnKMYi mw ARb KiZ ciwQ| Avgiv bvix, cyiyl, Awf eemvqx,
`kx-we`kx, miKvix KgPvix I D`vv, cKkjx BZvw` mKj kbxi MvnK`i mKj Pvwn`v c~iY Ki AvmwQ| Avgiv
cwZwbqZB Avgv`i KcviU MvnK`iK weZ cwimi evswKs mev `qvi Pv KiwQ Ges Zv`i bwgwK eemvwqK
cqvRbxqZvi ga KcviU wWU cY, URvix cY, e`wkK evwYR A_vqb, wewfb cK I wmwKU FY BZvw`
welqjvi Avw_K mgvavbi wbqZv c`vb KiwQ| myweav ewZ`i Rb wdbvbwkqvj BbKzkb, Mxb evswKs BZvw`i
gvag `ki Av_-mvgvwRK Dbqb NUvZ Avgiv cwZk~wZe| Avgiv `pfve wekvm Kwi h, Avgv`i AevnZfve
mvlRbK gybvdv ARb, cew, evRvii Askx`vwiZ BZvw` GKvfveB Avgv`i mevi YMZ gvbi Dci wbfikxj|
54| MelYv I Dbqb Ges cwkY
mvD_B evsK Zvi 76 wU kvLvi mvnvh eemv I gybvdvq DjLhvM cew ARbi gvag AZ mdjZvi mwnZ 16
eQi AwZg KiQ | mvD_B evsK cwZhvwMZvg~jK evswKs RMZ ckv`vix `Zv ARbi Rb MelYv Dbqb Ges
cwkY Gi Dci mevwaK iZ w`q _vK| `Zv I ckv`vixZi mg^q gvb-mZ gvbe m` ZixB evsKi g~j
j, hvZ Ki Kgx Drcv`bkxjZv ew Ki MvnK mev I evswKs Kvhg mevg DrKlZv wbwZ Kiv hvq| gvbe
m` Dbqbi KkjMZ, gvbexq Ges ZMZ `Zv ewi j evevqbi Rb 2005 mvj evsKi cavb Kvhvjqi
5g Zjvq wbR^ cwkY K` vcb Kiv nqQ| Uwbs BbwwUDU Kgx`i vbwfwK gy wPvi Av`vb c`vb I vbi
AvaywbKvqbi gvag evswKs RMZi RwUj Kvhgi welq mwVK w`K-wb`kbv `q| mKj cKvi cwkY cbqYi g~j
j nQ Kgxe`i eZgvb I cqvRbxq KvRi `Zvi ga cv_K Kwgq Avbv| Uwbs BbwwUDU GK K_vq gvbe
m`K wbZbZzb evswKs Z I fveavivi mwnZ cwiwPZ Ki Zv`i c~Y Kg mvebv I mvg_K weKwkZ KiZ Ae`vb
ivLQ| Gi dj^ic MvnK`i mgmvi `Z I ` mgvavb `qvi gZv ` gvbe m` Zwi nQ Ges kvLv cwZ mevP
gybvdv ARb wbwZ KiQ hv Kgx`i mevP KggZvi cgvY `q|

Annual Report - 20 10 61
cwiPvjbv cl`i cwZe`b
mvD_B evsK Uwbs BbwwUDU KZK 2010 mvj AvqvwRZ megvU 42wU cwkY Kvm, mwgbvi I Kgkvjv AbywZ
nq, GZ cwkYcv Kgxi msLv wQj 1923 Rb|
2010 mvj AfixY cwkYi Kvmjv njv :
AfixY cwkY Kvm/mwgbvi/ Kgkvjv Kvmi msLv cwkYv_xi msLv
1 dvDkb cwkY Kvm 1 58
2 dib GKvP wi gvbRgU 3 126
3 dib iwgU 3 170
4 dib UW Acvikb 1 40
5 dib GKvP wicvwUs 1 44
6 myBdU& Acvikb 1 53
7 wWU wi gvbRgU/wWU gvbRgU 1 38
8 GmGgB G GwM dvBbv 1 38
9 wWU Bb&digkb eyiv (wmAvBwe) 1 43
10 wWU KvW GwUGg/WweW KvW Acvikb 1 32
11 evmj-Uz G BU&m BgwcgbUkb 4 180
12 GwU gvwb jvwis 4 224
13 AvBwmwU G evsK Avwgvm Kvi evswKs wmg 5 188
14 AUvgkb Bb wKqvwis 2 70
15 BmjvwgK evswKs 1 24
16 gvKwUs Ae evswKs cvWvm& G KvqUj mvwfm 1 57
17 AvIqvibm Ab Kvk gvbRgU G KvqUj mvwfm 1 58
18 AUvgkb Bb evswKs wqwUs Gbvwes GbfvBibgU di B-evswKs G Gg-Kgvm 1 100
19 evsK msv Abvb Kgkvjv 9 380
megvU AfixY cwkY 42 1,923
AfixY cwkY QvovI, evsK 2010 mvj 198 Rb KgKZvK `k I we`k wewfb cwkY Kvm ciY Ki| 2010
mvj evsKi evBi AbywZ cwkYi weeiY wbg `qv njv:
AfixY cwkY Kvm/mwgbvi/ Kgkvjv Kvmi msLv cwkYv_xi msLv
1 weAvBweGg KZK AvqvwRZ wewfb evswKs mwKZ cwkY/Kgkvjv 35 43
(hgb FY, mvaviY evswKs, SuzwK eevcbv, m`-`vq evevcbv,
GmGgB A_vqb, AvRvwZK evwYR, e`wkK evwYR BZvw`)
2 dvDkb Uwbs 2 60
3 weAvBweGg eZxZ `ki Abvb Uwbs BbwwUDU(hgb evsjv`k 46 81
evsK cwkY GKvWgx, evd`v, GmBwm), evmj-Uz, Bmjvgx evswKs,
GGgGj, myBdU, Kvi, wi gvbRgU, wmAvB we BZvw`
4 we`k cwkY Kvm/mwgbvi/Kgkvjv 10 14
megvU evwnii cwkY 93 198
55| SzuwK eevcbv
evsKi wewfb aibi SuywK wbaviY, cwigvcKiY I SuywK gvKvejvq wewfb mZKxKiY eev MnY Kivi Rb mvD_B
evsK SuywK eevcbv BDwbU (RMU) MVb KiQ|
SuywK gvKvejvi c~ekZ nQ SuywK eevcbv KvVvgv MVb| ewkifvM B `Lv hvq SuywK eevcbv KvVvgvi
AbycwwZ A_ev Am~Y SuywK KvVvgvB SuywK gvKvejvq e_Zvi AbZg KviY| wewfb aibi SuywKi weklY, kYxKiY I
SuywK MnYi gZv wbicYKiY SuywK eevcbv KvVvgv MVbi c~ekZ| evsKi wewfb aibi SuywK wPwZKiY,
cwigvcKiY, cheY Ges wbqY eev vcb Kiv SuywK eevcbvi AMZ|

62 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b
vbxq I AvRvwZK evRvi mvD_B evsKi wewfb aibi cwiPvjbvRwbZ SuywK cheY I g~jvqb Kiv SuywK eevcbv
BDwbUi `vwqZ| GQvovI evsKi SuywK eevcbv cwqv DPZi i DbxZ Kiv, evmj - 2 evevqb Kiv Ges
AvRvwZK gvbi SuywK eevcbv iciLv Zix Kiv, SuywK eevcbv BDwbUi (RMU) AbZg `vwqZ|
SuywK eevcbv KvVvgvi wfw wewfb Dcv`vbi mg^q MwVZ wK Gi ga h `ywU Dcv`vb evsKi Rb me mgq
iZc~Y mjv nj chyw I Rbej| mRb mvD_B evsK SuywK eevcbv Dbqbi j Z_ chyw AvaywbKvqb I
gvbem` Dbqbi Dci Rvi w`qQ|
evsK SuywK eevcbvK GKwU MwZkxj cwqv gb Ki, hv evsKi cwZwU cwqvi mv_ mKhy| SuywK eevcbv
GKwU ixwZZ cwibZ ne hLb evsKi mKj KgKZv I wbevnxiv Lye mnRfve SuywK wPwZ KiZ cvieb Ges wewfb
wmv wKfve Gi Dci cfve wevi Ki Zv wbaviY KiZ cvieb| evsKi SzuwK eevcbvi Dci GKwU wek` cwZe`b
74 cvq mwbewkZ njv|
56| gvPU evswKs Acvikb
gvPU evswKs DBs Zvi cwZvjM 2009 Gi 1jv AvM _K mdjZvi mv_ Kvhg cwiPvjbv Ki AvmQ| 2010 mvj
Avgiv ek wKQz iKWfKvix cwiwwZi myLxb nqwQ Ges ek fvjvfveB Zv gvKvejv KiwQ| Zvi ga XvKv K
GPi mvaviY m~PK 8918.51 Z cuxQ Ges mevP 3249 KvwU UvKvi jb`b DjLhvM| GB mgqi AwwZkxj
evRvi wbqbi Rb wmwKDwiwUR G GP Kwgkb ek wKQz DjLhvM c`c MnY KiwQj| GB aibi AwwZkxj
Aevi gaI Avgiv weMZ eQiwj _K DjLhvM gybvdv ARb KiZ mg nqwQ|
2010 mvj _K gvPU evswKs DBs Zvi wewbqvMKvix`i Rb cvUdwjI gvbRgU Ges Avvi ivBwUs mev c`vb
Ki AvmQ| ZviB djkwZZ wewbqvMKvixi msLv 910 Ges cvUdwjI Gi cwigvb 511 KvwUZ cuQQ| eZgvb
`wbK Mo jb`bi cwigvb cvq 27 KvwU UvKv|
2009 mvji 14B Avei evsjv`k evsKi mvKzjvi Abyhvqx Kvb evsK Avjv`v mvewmwWqvix Kvvbx Qvov Kvb gvPU
evswKs Kvhg cwiPvjbv KiZ cviebv| GB mvKzjvi gvZveK evsKi cwiPvjbv cl` mvD_B evsK gvPU evswKs
DBs K mvD_B evsK KvwcUvj mvwfmm wjwgUW (SBCSL)" bvg Avjv`v GKwU mvewmwWqvix Kvvbx cwZv Kivi
wmv wbqQ hvnvi 2010 mvji 1jv wWm^i nBZ Abygvw`Z g~jab 300 UvKv Ges cwikvwaZ g~jab 100 KvwU
UvKv|
1jv Rvbyqvix 2010 _K 30 bf^i 2010, GB 11 gvm gvPU evswKs DBs 38.97 KvwU UvKv gybvdv KiQ| 2010
mvj cyuwRevRvi mvD_B evsK KvwcUvj mvwfmm wjwgUW Zvi wbR^ 54 KvwU UvKvi wewbqvM Kvl w`q evsKi
AevbK Aviv my`p KiQ| AvaywbK wewbqvMbxwZi mv_ mvgm iL Avgiv Avgv`i cyuwRevRvii wewbqvM Kkj
cwieZb GbwQ hvZ SzuwKi cwigvb Kg Ges GKwU wewQb wewbqvM Kvl ZixZ mnvqK nq|
MvnK`i Rb wewfb cvmwK iZc~Y mev c`vbi j SBCSL AbK vb Zvi Kvhg cuxQ w`Z Pvq| GiB
avivevwnKZvq SBCSL Lye kxNB gvnv`cyi, mvZgmwR` ivW, Kvgvj AvZvZ~K GwfwbD, w`jKzkv Ges `ki wewfb cv
bZ~b kvLv LyjZ hvQ| GB mg kvLvi gvag cyuwRevRvi evsKi GKwU my`p bUIqvK Zix ne Ges evsKi g~bvdv
Divi ew cve| GQvov SBCSL w`jKzkvi BDbyP mUvii jej-9 jxR wbqQ Bnvi eemvwqK cavb Kvhvjq I
Kvhg myPviic cwiPvjbvi Rb|
57| Bmjvgx evswKs
mvD_B evsK wjwgUW ew gvwjKvbvaxb evsKmg~ni ga bZvbxq evsK| G evsK mbvZb evswKs mevi mv_
mv_ c_Kfve Bmjvgx evswKs mevI evsjv`k evsKi wb`kvejx I BmjvwgK kixqvn& g~jbxwZi wfwZ c`vb KiQ|
BmjvwgK evswKs kvLvjvi Kvhg mybic mbvZb evswKs Kvhg _K wfb| evsK BmjvwgK evswKs wnmvemg~n
m~Y Avjv`vfve msib Ki _vK|
evsK 2003 mvj nZ BmjvwgK evswKs mev c`vb KiQ| evsK Gi gvU 76 wU kvLvi ga 5 wU BmjvwgK evswKs
kvLvi gvag MvnK mev c`vb KiQ| BmjvwgK evswKs Kvhg cwiPvjbvi Rb evsK `ki kxlvbxq BmjvwgK
wPvwe` Ges BmjvwgK evsKvi wbq GKwU kixqvn& mycvifvBRvwi KwgwU iqQ| D kixqvn& mycvBfvBRvwi KwgwU
BmjvwgK evswKs Kvhg mwVKfve cwiPvjbvi Rb bxwZgvjv cYqb I w`K&-wb`kbv w`q _vK| wbgewYZ kxlvbxq
BmjvwgK wPvwe``i wbq kixqvn& evW MwVZ:
1| cdmi gvIjvbv gv: mvjvn-Dwb
Pqvigvb, kixqvn mycvifvBRvwi KwgwU, LwZe, evqZzj gvKviig RvZxq gmwR`, XvKv

Annual Report - 20 10 63
cwiPvjbv cl`i cwZe`b
2. G.Gm.Gg. dLij Avnmvb
m`m, kixqvn mycvifvBRvwi KwgwU, cvb WcywU Mfbi, evsjv`k evsK|
3. gvIjvbv Avyj nvwKg AvRv`x
m`m, kixqvn mycvifvBRvwi KwgwU, wgwWqv ewZ Ges LwZe, BvUb MvWb Rvg gmwR`, XvKv|
D kixqvn mycvifvBRvwi KwgwUi Zveavb evsK mKj cKvi wWcvwRU, wewbqvM xgmg~n Ges bxwZgvjv cYqb I
w`Kwb`kbv w`q _vK| evsK K`xq kixqvn& evW Ges BmjvwgK evsKmg~ni KbmvjUwUf dvivgi m`m| evsK
`k-we`ki Abvb BmjvwgK esKmg~ni mv_ mymK envj iL KvR Ki _vK|
wWm^i 31, 2010 Bs ZvwiL mgv wnmve Abymvi BmjvwgK evswKs kvLvmg~ni mq I wewbqvMi cwigvY wQj
h_vg 993.70 KvwU Ges 613.55 KvwU Ges 2009 mvji Zzjbvq cewi nvi h_vg 3.60% Ges 29.71%|
AvjvP eQi evsKi Bmjvwg evswKs kvLvjvi gvU Avg`vwb I ivbx eemvi cwigvY wQj h_vg 323.52 KvwU
Ges 246.53 KvwU UvKv hv c~eeZx eQii Zzjbvq DjLhvM nvi ew cqQ| 2010 mvj Bmjvwg evswKs kvLvmg~ni
gvU Ljvwc FYi cwigvY wQj 0.433%| wWm^i 31, 2010Bs ZvwiL BmjvwgK evswKs kvLvmg~ni Dc I Avq
eqi wnmve G cwZe`b mwbewkZ nj|
58| wWU KvW
MvnK`i DZ Pvwn`v c~ibi j `ki AbZg wWU KvW mev c`vbKvix wnmve mvD_B evsK 2005 mvj hvv
i Ki| mmgq, wUKqK evsK Zv`i Lye ^ msLK mve MvnKK GB mev c`vb Ki AvmwQj| chvqg
MvnKiv wWU KvW eenvii mydj cZ i Ki Ges Gi mveZvi AviI ew cvq| dj Abvb Aviv AbK
evsK wWU KvW eemvq AeZxb nq| KwVb cwZhvwMZvi gaI weMZ 05(cuvP) eQi Avgiv Avgv`i MvnK msLv Ges
cwiPvjb Avq Gi avivevwnK DbwZ ARb KiwQ| djkwZZ, 2010 Gi kl Avgv`i MvnK msLv nqQ
19,172; hv c~eeZx eQii Zzjbvq 44% ekx Ges cwiPvjb Avq c~eeZx GKB mgqi Zzjbvq 20% ew cq 106
wgwjqb UvKvq DbxZ nqQ| UKmB wfw MVbi j Avgiv avivevwnK cew eRvq ivLZ mg nqwQ|
wWU KvW MvnK`i mvP myweav wbwZ Kivi j Avgiv Avgv`i cPv Pvwjq hvwQ| GB Pjgvb cPvi Ask
wnmve Avgv`i KvW mevq Avgiv mshy KiwQ H me eenvwiK DchvwMZv hv AvaywbK mgvR KbvKvUvq A_ cwikva
Ges cqvRb bM` Dvjb Acwinvh| BwZgaB Avgiv evsKi h Kvb kvLv nZ A_ Dvjb, KvW PK I SMS
Push Pull myweav wbwZ KiwQ| Travel Card Avgv`i Aci GKwU AvRvwZK Prepaid Card.

GK w`K hgb KvWi mev ZvwjKvi mKj mKj cKvi myweavmg~n wbwZ Kiv nqQ, Abw`K chywMZ
AvaywbKZv I MvnK mevi I iZc~Y fwgKvmg~n DcwZ nqwb| mevaywbK chywMZ myweavmg~n eenvii gvag
Avgv`i wbew`Z MvnKmev `j `Z I wekZvi mv_ mev c`vb Ki hvQ|
mvwbZ Accountholder-`i 24 Nv bM` UvKv Dvjbi myweav c`vbi j G eQi nZ Avgiv Own Processing
System G MvnKMbK Proprietary Debit Card - "My Card" myweav c`vb i KiwQ| BwZga 2010 mvj Avgiv wbR^
ATM vcb i KiwQ Ges AvMvgx ermiMyjvZ mviv`k evwc wbR^ ATM myweav weZ Kivi j wekvj cwiKbv
Mnb Kiv nqQ| Avgiv DBBL Ges BRAC evsKi Network mevi mv_ hy nqwQ| hvi djkwZZ Avgv`i mvwbZ
MvnKMY mviv`k nvRvii ekx ATM ey_ _K mivmwi bM` UvKv Dvjbi myweav fvM KiQb|
hnZz wWU KvWi MvnKmsLv cwZwbqZ ew cvQ ZvB kYxf`i cqvRb Abyhvqx Avgiv wewfb mev c`vb Kivi
K_v weePbv KiwQ| `ki mePq mvwbZ bvMwiK`i DPZi mev c`vb Kivi j VISA cvwUbvg KvW ceZb Kiv
Avgv`i AvMvgx eQii cwiKbv| AvaywbK mgqi Z_chyw wfwK Avw_K jb`bi SEBL KvW wWwfkb Zvi
Awfbe cwiKbv Ges wbew`Z mev c`vb KiQ hv evsKi mvweK fveg~wZ Dbqb iZc~Y fwgKv ivLQ |
59| kvLv mcmviY Kgm~Px
mvD_B evsK wjwgUW eZgvb `ki wewfb iyZc~Y GjvKv Ges eemvK` mg~n AewZ 76 wU kvLvi gvag Zv`i
evswKs Kvhg cwiPvjbv KiQ| `ki mKj ii MvnK`i wbKU DbZZi I `Z mev c`vb Kivi j mvD_B
evsKi 46wU kniKw`K kvLv, 15wU cjx-kvLv Ges 10 wU GmGgB/Kwl kvLv iqQ| GQvovI evsKi 5wU kvLv
Bmjvgx kixqvn& gvZveK Kvhg cwiPvjbv KiQ| XvKv I PMvg AewZ `ki ivbx cwqvKiY GjvKvq evsKi
2wU Ad&-kvi evswKs BDwbU& iqQ| MvnK`i bZzb bZzb Pvwn`v gUvZ Ges MvnKmevi cwiwa wewZK evsK 2011
mvj 10wU kvLv I 10wU GmGgB/Kwl kvLvmn gvU 20wU kvLv evsjv`k evsKi AbygwZ mvc Lvjvi cwiKbv MnY
KiQ| `ki cjx Kw`K geway eemvK` mg~n kvLv Lvjvi gvag evsK `ki fvimvgc~Y A_bwZK AMMwZ
ARb mg ne|

64 Annual Report - 20 10
cwiPvjbv cl`i cwZe`b
60| evsKi wWU iwUs
wWU iwUs weeiY `xN gqv`x ^ gqv`x ge
wWU iwUs kYxgvb GG- Gm wU-2
Bbdigkb Wej G gvBbvm DP MW
G mvwfmm (DP wbivcv)
wjwgUW G kYxfy evsKjvi G kYxfy evsKjv Zv`i 31 wWm^i 2009
FYmg~n AwaKZi wbivc` Ges Avw_K cwZkwZ c~iYi ZvwiLi wbixwZ
DP gvbmb | G ii iwUs mvg_i DP wbqZvi Avw_K weeiYxi
wbwZ Ki h, KcviU wfwZ| `xN
wb`kK| kwkvjx Zvij Ges gqv` G iwUs
cwZvbwUZ eo Kvb mgmv Gwcj 26, 2011
Qvov fvj FY eevcbv fvj gwjK cwZivaK Dcv`vb
ch ejer
we`gvb| SuzwK Dcv`vbjv we`gvb | SzwK Dcv`vb ^ | _vKe|
bgbxq Ges A_bwZK Aevi
mv_ mgq mgq A gvvq
cwieZb nq|
cwZe`b c`vbi ZvwiL: 27k Gwcj, 2010 Bs

61| evmj-2 Gi evevqb I cwZ


evmj KwgwU Ae evswKs mycviwfkb KZK cewZZ g~jab chvZvi bxwZB evmj-2 bvg cwiwPZ| GB bxwZgvjvi Aaxb
evsjv`k evsKi wb`kbvq mvD_B evsK wjwgUW 1jv Rvbyqvix 2009 _K b~bZg g~jab chvZvi cwZe`b `vwLj
Ki AvmQ Ges Gi Abvb w`Kmg~n chvqg evevqbi D`vM Mnb KiQ| GB bZzb g~jab KvVvgvi Dk nQ
evsKi SzuwK eevcbvi Dci iZ Avivc Kiv, hv wZbwU i Dci cwZwZ, wZbwU nj :
1) b~bZg g~jab chvZv
2) Z`viwK chvjvPbv
3) evRvi ksLjv
evmj-2 FY SzuwK eevcbvq hyMvchvMx Kkj ceZb KiQ Ges cwiPvjb SzuwKi Dci weklfve AvjvKcvZ
KiQ| evmj-2 Gi Acwinvh ewkjv nQ:
K) b~bZg g~jab chvZv wbYq FY SzuwKi wZbwU c&wZ iqQ|
L) FY SzuwK eevcbvq AfixY iwUs cwZ cqvMi gvag evsKjvi g~jab msiY wbR^ wePvi weklY cqvM
wKQzUv ^vaxbZv c`vb Kiv nqQ|
M) evRvi kOLjv Avbqb cqvRbxq Z_ cKvki Dci iZ Avivc Kiv nqQ hv evsKi m wewfb Mvxi ^v_iv
Kie|
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Annual Report - 20 10 65
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66 Annual Report - 20 10
Report on Corporate Governance
Southeast Bank operates within the legal framework of the companies Act-1994 and as a banking company complies with
the provisions of the Bank Company Act-1991.The Bank is responsibly managed and supervised in fulfillment of the
objectives of adding value to the shareholder wealth and contributing to the national economy. Our Corporate
Governance principles serve the goal of strengthening and consolidating company position with sustained growth
objectives in materializing the trust placed in the company by the shareholders, clients, employees and the general public.
Fair practice, accountability, transparency, compliance, value creation and corporate social responsibility are the pillars of
our corporate governance. A comprehensive framework of policies across all the areas of the Banks operations are set in
place. The control mechanism is working well and has further been strengthened in the Bank. The principles of corporate
governance in practice have been strengthened and are now embedded in the Banks overall activities. There is clear
leadership and Management Structure across the entire Bank. The Banks corporate governance structure comprises the
following parties and participants:
A) The Shareholders.
B) The Board
C) Bank Management
D) Regulatory Authorities and
E) Independent External Auditors
A. Shareholders
The shareholders of the Bank exercise their rights at the Annual General Meeting (AGM). AGM is being held every year
within March. The constructive suggestions of the shareholders are implemented in the interest of the Bank. They by their
considered votes approve Banks financial statements, reports of the Board and that of the Auditors, declaration of
dividend by the Bank, elect/re-elect directors of the Bank and appoint External Auditors in the Annual General Meeting
of the Bank. They also by their considered votes pass special resolutions in Extra-Ordinary General Meetings in amending
Memorandum and Articles of Association of the Bank, issuance of Rights Shares, Bond by the Bank etc. Our Share
Division is shareholders relationship department. Shareholders have right to information which we provide them timely.
Any material change in the Bank concerning shareholder interest or any price sensitive information is quickly disclosed
for information of the shareholders and potential investors. The Bank Management also holds meaningful dialogue with
the shareholders for both qualitative and quantitative improvement of the Bank.

Annual Report - 20 10 67
Participants in Corporate Governance Report on Corporate Governance
Board of
Directors
Bank
Independent
Management
External
Auditors
Shareholders.

Regulatory
Bank
Authorities
Employees
Customers

B. Board of Directors
Composition
The Board of Directors is the body responsible for corporate governance, devising policies and determining objectives for
stewardship of Banks resources. The Board of Directors consists of 16 (sixteen) Directors including the Managing Director.
The Chairman and in his absence, the Vice Chairman, presides over meetings of the Board of Directors, Annual General
Meetings and the Extra-Ordinary General Meetings.
Compliance
To comply with the requirement of Securities and Exchange Commission (SEC) Notification dated 20th February, 2006,
the Board appointed Dr. Zaidi Sattar, a renowned economist of the country and Chairman of the Policy Research Institute
of Bangladesh as an Independent Director of the Bank in the 12th Annual General Meeting held on April 28, 2008.
Southeast Bank has also appointed two Directors from the Depositors of the Bank in compliance with BRPD Circular
Letter No.12 dated 18th August, 2008 of Bangladesh Bank. One of the Depositor Directors is Mr. A.H.M. Moazzem
Hossain, an economist and the editor of the leading Financial daily, The Financial Express. The appointments of the two
Depositor Directors took effect from 8th October, 2008. Their first term in office will expire on 7 October, 2011.
Functions
The functional areas of the Board include, but not limited to, approving suitable business strategy, fixation of operational
budgets, approval of financial statements, review of Banks operational performance towards achievement of objectives and
approval of policies and operational manuals to establish effective risk management in core banking areas.
The functions of the Board also include reviewing companys corporate governance standard for further improvement,
determining Banks corporate social responsibility status and taking steps for its improvement, developing compliance
culture in the Bank, approving proposals which are beyond the delegated business / financial / administrative powers of the
Management, appointment of the Chief Executive Officer and fixation of his benefits, etc. The Board held 22 (Twenty
Two) meetings in 2010.
Rotation and Retirement of Directors
The Directors of the Bank excluding the Managing Director retire in rotation in accordance with the provisions of
Companies Act 1994. In this respect, the provisions contained in the relevant laws and the Articles of Association of the
Bank are complied with in letter and spirit.
The Board has constituted the following 02 (two) Committees:
i) Executive Committee
The Board has set up the Executive Committee as a body to deliberate on generally important management issues and
matters in the execution of operations of the Bank. The Committee performs within the powers delegated to it by the
Board of Directors. The Committee is composed of 7 (Seven) members including the Managing Director. The Chairman
of the Board is the Chairman of the Executive Committee. Twenty Four meetings of the Executive Committee were held
in 2010.
ii) Audit Committee
The Audit Committee oversees internal control, audit and financial reporting. It monitors implementation of policies on
internal control and compliance and management actions on audit findings. It actively reviews appropriateness of the
accounting policies, annual audit plan, audit reports, risk management of the Bank and Banks technological needs. It also
recommends appointment of external auditors and oversees their discharge of responsibilities as external auditors.
The Audit Committee consists of 3 (three) members of the Board as per BRPD Circular No.12 dated December 23, 2002
of Bangladesh Bank. Mr. Azim Uddin Ahmed is the Chairman of the Audit Committee. The Audit Committee held 4
(Four) meetings in 2010. The minutes of meetings of the Audit Committee were submitted before the Board of Directors
and the Board reviewed them.

68 Annual Report - 20 10
Report on Corporate Governance

iii) Loan to Director


No fresh loan was allowed to any Director of the Bank during the year 2010.
C. Bank Management
Ensuring effective corporate governance is one of the top priorities of management for realizing the objectives advocated
in our management philosophy. The Bank is managed by a team of dedicated and efficient professionals headed by the
Managing Director. The functions of the Board and the Management are clearly defined and sharply bifurcated.
The Management implements and acts within the policies approved by the Board. A clearly defined organizational
structure with definite lines of responsibility and delegation of powers to different echelon of the management are in place
in the Bank. The Management enjoys full freedom in conducting the business of the Bank within the scope of the
policy-guidelines of the Board and the regulatory bodies. However, the Board and the Management work in unison for the
continued growth and improvement of the Bank. To streamline functions, the following Committees are actively working
in the Bank:
i) Management Committee (MANCOM)
To address general issues of importance, evaluate different types of risks, monitor internal control structure and to review
effectiveness of the internal control system, a Management Committee (MANCOM) is working in the Bank. It is
composed of senior members of the Management. The Managing Director acts as the Chairman of MANCOM. The
meetings of the MANCOM are held every month to review and address relevant issues timely.
ii) Asset Liability Management Committee (ALCO)
Asset Liability Management Committee consists of the Managing Director, the Deputy Managing Directors and
strategically important Divisional Heads of Head Office. The Managing Director and in his absence the Deputy Managing
Director chairs the meeting of the Asset Liability Management Committee. The Committee is responsible for managing
balance sheet gap with particular emphasis on maturity profile of deposit and landing, interest rate risk and liquidity risk
of the Bank. The meetings of the Asset Liability Management Committee are held every month.
iii) Credit Committee
A Credit Committee headed by the Managing Director of the Bank has been constituted at Head Office of the Bank for
appraisal and quick disposal of credit proposals. The Deputy Managing Director of Corporate Banking plays an important
role in the meetings of the Credit Committee. Credit proposals that do not merit considerations are declined. Credit
proposals that merit considerations in the opinion of the Credit Committee are presented before the Managing Director
of the Bank for approval. The credit proposals that are beyond the delegated business power of the Managing Director are
placed before the Executive Committee / Board of Directors for consideration / approval.
D. Regulatory Authorities
The role of regulatory authorities is very important in respect of corporate governance practices of Southeast Bank Limited.
The Bank is pledge-bound to comply with all the requirements of regulatory authorities. Their continuous support and
co-operation to the Bank are highly valued by the Banks Board and the management.
E. Independent External Auditors
M/S Rahman Rahman Huq, a top ranking Audit Firm have been re-appointed as the External Auditors of the Bank in the
15th Annual General Meeting held on March 29, 2010 for the first term. They are eligible for re-appointment in the 16th
Annual General Meeting of the Bank. The External Auditors enjoy full freedom in their audit of accounts of the Bank and
reporting to the Shareholders.
A report on corporate governance of the Bank as per directives of the SEC dated February 20, 2006 is appended hereto.
Compliance report as per Securities & Exchange Commissions Notification dated 20th February, 2006 for all companies
listed with any Stock Exchange in Bangladesh in order to improve Corporate Governance in the interest of Capital Market
on Comply or Explain basis.

Annual Report - 20 10 69
Report on Corporate Governance

Compliance report as per Securities & Exchange Commissions Notification dated 20th February, 2006 for all
companies listed with any Stock Exchange in Bangladesh in order to improve Corporate Governance in the
interest of Capital Market on Comply or Explain basis.

Condition Title Compliance status Remarks


No. (Put in the appropriate column)
Complied Not Complied
1.1 Boards size.
1.2(i) Independent Director.
1.2(ii) Appointment of Independent Director.
1.3 Chairman of the Board and
Chief Executive Officer (CEO)
1.4 Boards Report.
1.4(a) Fairness of Financial Statements
1.4(b) Maintenance of proper books of accounts.
1.4(c) Appropriate accounting policies.
1.4(d) Compliance with International Accounting Standards
1.4(e) Soundness of Internal Control System
1.4(f ) Banks abilities to continue as a going concern
1.4(g) Changes in operating results.
1.4(h) Three years financial data
1.4(i) Declaration of Dividend
1.4(j) Details of Board meeting
1.4(k) Shareholding pattern
2.1 Appointment of: Company Secretary
CFO
Head of Internal Audit.
2.2 Attendance of : Company Secretary
CFO Attends as and when
in Board Meetings required

3.0 Audit Committee


3.1(i) Constitution of Audit Committee
3.1(ii) Inclusion of independent Director on the
Audit Committee
3.1(iii) Filling of casual vacancy in the No such situation
Audit Committee
3.2(i) Chairman of the Committee
3.2(ii) Qualification of the Chairman of the
Audit Committee
3.3 Reporting of the Audit Committee.
3.3.1(i) Reporting to the Board of Directors
3.3.1(ii)(a) Reporting of conflict of interest to the Board
3.3.1(ii)(b) Reporting of any fraud or irregularity to the Board
3.3.1(ii)(c) Reporting of violation of any laws to the Board Not Applicable The Audit Committee
had no findings on
violation of law during
the year to report to
Board.

70 Annual Report - 20 10
Report on Corporate Governance

Condition Title Compliance status Remarks


No. (Put in the appropriate column)
Complied Not Complied

3.3.1(ii)(d) Reporting of any other matter to the Board Not Applicable The Audit Committee
had no such findings for
report to the Board of
Directors.
3.3.2 Reporting to the concerned Authorities. Not Applicable The Audit Committee
had no findings for report
to the Securities and
Exchange Commission.
3.4 Reporting to the Shareholders and
general investors
4.0 External/Statutory Auditors
4.0(i) Non-engagement in appraisal or valuation
4.0(ii) Non-engagement in designing of
Financial Information System
4.0(iii) Non-engagement in Book keeping Not applicable
4.0(iv) Non-engagement in Broker -
dealer service Not applicable
4.0(v) Non-engagement in actuarial services Not Applicable
4.0(vi) Non-engagement in internal audit Not Applicable
4.0(vii) Non-engagement in any other services Not Applicable

Attendance of Directors in the meetings


A) Meeting of the Board of Directors

Name of the Directors Total no. of meetings Total Remarks


from 01.01.2010 to attendance
31.12.2010
Alamgir Kabir, FCA 22 22 The Directors who
Ragibl Ali 22 13 could not attend any
meeting were granted
M. A. Kashem 22 18
leave of absence
Azim Uddin Ahmed 22 19
Tahnoun A. Harun
representing Bangla Capital Limited 22 2
Jusna Ara Kashem 22 17
Duluma Ahmed 22 21
Syed Shahid Ali 22 20
Rehana Rahman 22 18
Md. Akikur Rahman 22 9
Monjur Miah 22 1
Sirat Monira 22 21
Abdul Hye
representing Karnafuli Tea Co. Ltd 22 8
Dr. Zaidi Sattar 22 15
A.H.M. Moazzem Hossain 22 17
Mahbubul Alam
Managing Director 22 21

Annual Report - 20 10 71
Report on Corporate Governance

B) Meeting of the Executive Committee of the Board of Directors

Name of the Directors Total no. of meetings Total Remarks


from 01.01.2010 to attendance
31.12.2010
Alamgir Kabir, FCA 24 22 The Directors who
Ragib Ali 24 13 could not attend any
meeting were granted
M. A. Kashem 24 18
leave of absence
Azim Uddin Azim 24 21
Dr. Zaidi Sattar 24 18
A.H.M. Moazzem Hossain 24 22
Mahbubul Alam
Managing Director 24 18

C) Meeting of the Audit Committee of the Board of Directors

Name of the Directors Total no. of meetings Total Remarks


from 01.01.2010 to attendance
31.12.2010
Azim Uddin Ahmed 4 4 The Directors who
M. A. Kashem 4 3 could not attend any
meeting were granted
Dr. Zaidi Sattar
leave of absence
(Independent Director) 4 4

D) Pattern of Shareholdings:
i) Shares held by Parent/Subsidiary/Associated Companies and other related Parties
NIL
ii) Ownership of Companys Securities by the Members of Board of Directors.

Sl. No. Name of the Directors No. of Shares Value in Tk. Percentage
1. Alamgir Kabir, FCA 8,59,613 8,59,61,300.00 1.24%
2. Ragib Ali 19,51,404 19,51,40,400.00 2.82%
3. M. A. Kashem 19,64,751 19,64,75,100.00 2.83%
4. Azim Uddin Ahmed 18,96,456 18,96,45,600.00 2.74%
5. Bangla Capital Limited 1,02,351 1,02,35,100.00 0.15%
6. Jusna Ara Kashem 4,58,192 4,58,19,200.00 0.66%
7. Duluma Ahmed 14,21,551 14,21,55,100.00 2.05%
8. Syed Shahid Ali 1,92,705 1,92,70,500.00 0.28%
9. Rehana Rahman 8,80,843 8,80,84,300.00 1.27%
10. Md. Akikur Rahman 6,38,669 6,38,66,900.00 0.92%
11. Monjur Miah 3,29,313 3,29,31,300.00 0.48%
12. Sirat Monira 9,112 9,11,200.00 0.01%
13. Karnafuli Tea Co. Limited 12,277 12,27,700.00 0.02%
14. Dr. Zaidi Sattar, Independent/Depositor Director - - -
15. A.H.M. Moazzem Hossain, Depositor Director - - -
16. Mahbubul Alam, Managing Director - - -
Total Shares : 1,07,17,237 107,17,23,700.00 15.46%

72 Annual Report - 20 10
Report on Corporate Governance

iii) Shares held by Chief Executive Officer, Company Secretary, Chief Financial Officer, Head of Internal
Audit and their spouses and minor children.

Sl. No. Designation Shareholdings as


on 31.12.2010

1 a) Mahbubul Alam
Chief Executive Officer -
b) Spouse / Minor Children of CEO -

2 a) Muhammad Shahjahan
Company Secretary 84
b) Spouse / Minor Children of Company Secretary -

3 a) Arun Chandra Paul


Chief Financial Officer -
b) Spouse / Minor Children of Chief Financial Officer 2

4 a) Haradhan Banik
Head of Internal Audit -
b) Spouse / Minor Children of the Head of Internal Audit -

iv) Shares held by top five salaried Executives in the regular services of the Bank.

Sl. No. Designation Shareholdings as


on 31.12.2010

1. Syed Imtiaz Hasib, Deputy Managing Director -

2. Mohammed Gofran, Deputy Managing Director -

3. Shahid Hossain, Deputy Managing Director -

4. Muhammad Shahjahan, Senior Executive Vice President 84

5. S. M. Mainuddin Chowdhury, Senior Executive Vice President 72

v) List of Shareholders holdings 10% and above shares in the Paid-Up-Capital of the Bank.
NIL

Annual Report - 20 10 73
A commercial Bank broadly categorized, performs two major functions:

Offer financial products and services to the clients.


Engage in financial intermediation and risk management.

A Banks economic performance therefore largely depends on the quality service and efficiency of its risk management.
Effective Risk Management is perceived to be necessary and critical to ensure long time survival of the Bank. Southeast
Bank Limited has taken various initiatives for strengthening risk management practices in conjunction with the business
strategy and operational activities. The Bank has an integrated approach for management of risk and in this regard it has
formulated policy documents taking into account the business requirements / best international practices and above all as
per the guidelines of the Bangladesh Bank. The risk management of the Bank covers following six core risk areas:

a) Asset Liability Risk Management,


b) Foreign Exchange Risk Management,
c) Credit Risk Management,
d) Internal Control & Compliance Risk Management,
e) Money Laundering Risk Management,
f ) Information and Communication Technology (ICT) Risk Management.

74 Annual Report - 20 10
Report on Risk Management

trol
C on
e
ag
an
M

01. Asset Liability Risk Management:

The Asset Liability Management (ALM) is a key Balance Sheet Risk Management discipline which mainly focuses on
liquidity and interest rate risk of the Bank. ALM process of our Bank involves analysis, evaluation, identification and
management of certain risks or combination of risks. The main objective of ALM is to manage the Balance Sheet risk of
the bank through management of net interest income, sensitivity, management of liquidity risk, capital management,
undertaking financial hedge positions, internal profitability measurement and regulatory compliance. The year 2010 was
an eventful year for each of the banks Treasury Division. In this year the Bangladesh Bank with the aim of controlling the
inflation rate of the country has taken certain measures by increasing the Cash Reserve Requirement (CRR) & Statutory
Liquidity Ratio (SLR) in the middle and at the end of the year. In this complex situation our bank managed its assets and
liabilities more prudently ensuring optimum liquidity with compliance of regulatory requirements again realizing
considerable amount of profit by manipulating the risk associated with the market. To address and mitigate various risks
involved in the business, ALM desk of the treasury department of our Bank prepared ALCO (Asset Liability Committee)
paper in each month and conducted monthly Asset Liability meeting where economic outlook and financial fundamentals
of the Bank were highlighted. Decisions taken in the ALCO meetings were duly recorded and action plans were
implemented by the branches and departments to optimize Banks financial performances. As a result, the Bank registered
substantial growth in all the performance indicators including operating profit in 2010 by minimizing the liquidity and
interest rate risk. As a part of regulatory requirement, the Management also reviewed and revised the ALM manual in June
2010.

02. Foreign Exchange Risk Management

Foreign exchange risk arises when the Bank is involved in foreign currency transactions. These transactions include foreign
currency exchange, placement, investments, loans, borrowings and different contractual agreements. The foreign exchange
risk of our Bank was minimal as almost all the transactions were carried out on behalf of the customers against underlying
L/C commitments and other remittance requirements. Also, proper risk limits were approved by the Board of Directors,
which were meticulously observed and Internal Control & Compliance Division of Head Office also regularly reviews the
process of Foreign Exchange Risk Management. In general, the Banks policy is to match foreign currency assets and
liabilities following strictly the overnight limit of our open position fixed by the Central Bank.

Treasury Department independently conducts the transactions and the back office of the treasury is responsible for
verification of the deals and passing of their entries in the books of accounts. All foreign exchange transactions are revalued
and all Nostro Accounts are reconciled periodically.

03. Credit Risk Management

In order to bring more perfection in the implementation of our CRM policy, establishing better control over the loan
portfolio and to comply with Bangladesh Banks guidelines, Southeast Bank Limited has established a separate Credit Risk
Management (CRM) Division at Head Office in February, 2010 comprising of three departments namely; Credit Approval
Department, Credit Administration Department and Legal Affairs & Recovery Department. Under the new set up of
CRM Division, Credit Approval Department is responsible for analyzing the proposal, assessing different risk elements like
Management, Financial, Marketing, Technical etc. associated with the business and finding out the mitigating factors
which help the management to take decisions. On the other hand, the functions of documentation, disbursement,
monitoring and compliance are vested upon Credit Administration Department. This Department keeps themselves
vibrant in maintaining/improving quality of assets of the Bank. Legal Affairs and Recovery Department is entrusted with
the responsibility of recovering of classified/non-performing loans and filing of suits against defaulted borrowers & other
related legal matters of the Bank.

Annual Report - 20 10 75
Report on Risk Management

v) AML Risk Analysis.

vi) Monitoring of Clients Accounts.

vii) Special attention and implementation of adequate security measures on Correspondent Banking.

viii) Reporting of unusual/suspicious transactions to regulatory authority.

ix) Implementation of adequate customer & business related controls according to the AML & ATF

requirements.

x) Training & Awareness of all the employees on the issue of AML & ATF.

xi) Implementation of Record Retention Requirements.

xii) Implementation of Embargo Requirements.

xiii) Discharging Individual Roles & Responsibilities on the issue of AML & ATF, etc.

All the concerned officials of the Bank ensure that SEBL is not used as a channel for criminal funds. They are
well-conversant about the standards, laws & regulations, manuals, guidelines, policies, circulars etc in connection with
AML & ATF activities and follow the same properly.

06. Information and Communication Technology (ICT) Risk Management

Information assets are very critical to the services provided by the Bank to its customers. Protection and maintenance of
these assets are essential for sustainability and growth. The Bank has already commissioned state-of-art Data Center and
Disaster Recovery Site and taken initiatives to protect the information from unauthorized access, modification, disclosure
and destruction to protect customers interest. The Bank has been maintaining physical security for its workplace to protect
ICT resources as per the Physical Security Guideline under Tier-1 of ICT guideline of Bangladesh Bank. The Bank is
strictly following the Information Security Standard of Bangladesh Bank which covers Password Control, User ID
Maintenance, Input Control (i.e. Maker-Checker Concept), Network Security, Data Encryption, Virus Protection and
users access to internet and e-mail. The Bank has established secured network infrastructure by deploying a number of
logical protection levels between web application and database layers. The Routers are configured with ACL (Access
Control List) and Virtual Private Network (VPN) allowing traffic only to destination IP and desired service. The Bank has
elaborate Business Continuity Plan (BCP) in place as per the ICT guidelines of Bangladesh Bank. Training is a key
component of ICT Risk Management. The Bank has been continuously conducting training programs on critical ICT
matters (i.e. operational procedure, security procedures, steps to be taken in case of any contingency / health security in the
ICT area, Business Continuity Plan, Disaster Recovery Plan etc.) for relevant employees. The Bank has developed a critical
human resource backup plan with detail job description for IT personnel, segregation of duties for IT tasks and system
support in respect of severity.

76 Annual Report - 20 10
Report on Corporate Social Responsibility
Our CSR activities follow transparent business practices that are based on ethical values, compliance with legal and
regulatory requirement and respect for people, communities and the environment. We are responsible for the totality of
our impact on people and the planet, beyond making profit.

Southeast Banks banking practice is based on a network of relationship with its employees, customers, suppliers,
business associates, shareholders, regulatory authorities and the community. The Banks corporate social responsibility is
about addressing the needs of all the stakeholders in a way that advances its business and makes a positive and
meaningful contribution to the society.

Employees
The Banks business is dynamic and growing. This dynamism and growth come from its skilled and experienced human
resource that can be found at every level of the organization. The Bank offers its employees very competitive pay package
and bonus that are reviewed on a continuous basis in line with the market dynamics. It provides the employees a safe and
congenial work environment. It also offers its employees handsome retirement benefits by way of Contributory
Provident Fund, Gratuity, Superannuation benefits, etc. As a consequence, Southeast Bank has emerged as a Bank with a
vision; workplace of choice of many. The Banks rapid growth in business presents opportunities for talented employees
to take added responsibilities. The employees follow the ethical and other codes of conduct as embodied in the Service
Rules and Regulations of the Bank.

Annual Report - 20 10 77
Report on Corporate Social Responsibility

Customers

The need to focus on the need of customers is fundamental to banking business. Southeast
bank discharges this vital responsibility by offering financial products and services that truly
meet their needs. In discharging this vital responsibility, the Bank always strives to maintain
the highest standard of ethics in the conduct of its business. The Bank feels proud that these
efforts have earned it the trust of the customers. This trust in turn motivates the Bank to carry
out every single transaction with the customers with the highest degree of commitment and
transparency without any hidden cost. The Bank looks upon the customers as its partners in
business and sincerely endeavours to improve its relationship with them for mutual benefit.

Shareholders

The Southeast bank is fully committed to protect the interest of its


shareholders. They fully exercise their rights and their constructive
suggestions are implemented for the betterment of the company.
The Bank releases enough disclosures for the information of the
shareholders in the Annual Reports, half-yearly financial statements,
the print and electronic media and in the Banks website. It always
endeavours to enhance shareholders value by optimizing financial
performance at least cost. Since inception, the Bank has paid good
dividends to the shareholders. The number of shareholders of the
Bank is increasing that testifies their unshakable trust in the Bank.

The Banks Business Associates

Alamgir Kabir, FCA, Chairman, The Bank continuously endeavours to create a long-lasting win-win relationship with its
accompanied by Azim Uddin Ahmed, suppliers and business associates for mutual growth. Its relationship with them is based on
Director, Southeast Bank Limited handed mutual trust and respect. It deals with them in a fair and transparent way. Southeast Bank
over a cheque for Tk.25.00 lac to the Honble
Prime Minister for the victims of the fire enjoys credit lines from Correspondents and Foreign Banks and special credit line from ADB
incident of Neemtali and building collapse of and IFC.
Begunbari of Dhaka City.
Environment
The Bank continuously strives to ensure that its operations are environment-friendly and
discourages financing projects contrary to it. It has extended its helping hands to initiatives of
community leaders for environment protection and development. It is one of the leading
participants in the beautification of Dhaka City. The beautification
of the road-island from Russell Square to Manik Miah Avenue was
done by the Southeast Bank. We are moving fast towards green
banking.

Regulators

Southeast bank firmly believes that it is imperative to comply with


the relevant laws, rules and regulations of all regulatory authorities
to be a responsible corporate citizen. The Banks business practices
are transparent and are appreciated by the regulators. The Bank
operates cautiously observing the anti-money laundering practices.

Community
a) We believe every business should give something back to the
Dr. Atiur Rahman, Governor, Bangladesh society. Southeast Bank works to promote good community relations to foster a relationship
Bank and Directors of Southeast Bank of understanding, trust and credibility. It has a long history of support for charitable causes.
Limited are seen with the recipients of
Southeast Bank Foundation Scholarship at a
We help achieve lasting changes in the lives of people who are disadvantaged or vulnerable. In
function held on 23 May, 2010. Two 2010, Southeast Bank has spent Tk.2.37 million as donations for education, sports, art,
Hundred Thirty (230) poor but meritorious culture, health-care, community development, relief operations etc.
students have been selected for scholarship.
The Scholarship money for every student is b) Our credit policy has been redesigned to avoid concentration of Banks credit in major cities
Tk.1,500.00 per month with a lump-sum and to encourage distribution of credit in priority sectors particularly in Agriculture and
amount of Tk.4,000.00 for each Academic
Session. SMEs.

78 Annual Report - 20 10
Report on Corporate Social Responsibility

c) A senseless killings of valiant army officers was committed by the misguided BDR personnel at BDR Headquarters,
Peelkhana, Dhaka on February 25, 2009. It widowed and orphaned innocent people and catapulted the affected families
in distress and uncertainty. Southeast Bank pioneered and propagated an idea to stand by the affected families which won
wide appreciation at different levels. In accordance with our devised formula, the Bank, in collaboration with the
Government of Bangladesh, selected the following 7 (seven) bereaved families of the Shaheed Army Officers who embraced
martyrdom at the carnage at BDR(now BGB) Headquarters to stand by them. Each family is being given Tk.40,000.00
(Forty Thousand) only per month totaling Tk.4,80,000.00 (Four Lac Eighty Thousand) only in a year and the contribution
will continue for 10 (ten) years.
Sl. Name of the Shaheed Monthly Yearly Widow of Shaheed
No. Army Officers Contribution Contribution Army Officers
1. BA 1892 Tk. 40,000.00 Tk. 480,000.00 Ms. Farhana Bari
Brig. General Md. Abdul Bari
2. BA 1480 Tk. 40,000.00 Tk. 480,000.00 Ms. Nehrin Ferdousi
Col. Md. Mojibul Huq
3. BA 2324 Tk.40,000.00 Tk.480,000.00 Ms. Zobaida Begum
Col. Mohammad Mashiur Rahman
4. BA 2409 Tk.40,000.00 Tk.480,000.00 Ms. Loby Rahman
Col. Kudrat Elahi Rahman Shafiq
5. BA 2605 Tk.40,000.00 Tk.480,000.00 Ms. Mahbuba Begum
Maj. Md. Abdus Salam Khan
6. BA 2806 Tk.40,000.00 Tk.480,000.00 Ms. Munmun Rahman
Lt. Col. Md. Lutfur Rahman
7. BA 3716 Tk.40,000.00 Tk.480,000.00 Ms. Rita Rahman
Maj. Md. Mahbubur Rahman
Total: Tk. 33,60,000.00

First years contribution for Tk.3.36 million only was paid to the widows of the Shaheed Army Officers at the Prime
Ministers Office (PMO) on April 01, 2009. The second years contribution of Tk.3.36 million was paid to the widows of
the Shaheed Army Officers at the PMO vide pay orders dated February 02, 2010.

d) Apart from the above, Southeast Bank also donated Tk.2.50 million only to the Prime Ministers Relief Fund on 16
June, 2010 for relief operations amongst victims of fire incident at Neemtali and building collapse of Begunbari of Dhaka
City.

e) Southeast Bank also donated Tk.5.00 million on 26.07.2010 towards establishment of Muktijuddha Jadughar to uphold
national heritage for posterity.

f ) Boxing is a neglected sport areas, Southeast Bank came forward for improvement of boxing in the country. The Bank
donated total Tk.2.26 million to Bangladesh Amateur Boxing Federation for the purpose.

g) Southeast Bank donated Tk.5.00 million on 11.01.2010 to Bangladesh Olympic Association in co-sponsoring the 11th
SA Games Dhaka-2010.

Southeast Bank donated Tk.0.50 million on 05.04.2010 to Bangladesh Hand Ball Federation in sponsoring the IHF
Challenge Trophy, Bangladesh 2010.

National Economy

Southeast Bank has directly employed people in the service of the Bank. We have also generated employments for
thousands of men and women in the projects and industrial ventures established with our finance. The credit policy of the
Bank has also been so designed as to promote trade, commerce and industry which will ultimately contribute to the growth
of national economy. It will also help creation of employment opportunities. By mobilizing deposits for the Bank, we have
contributed to the formation of capital of the country. We have collected tax on interest/profit earning of the depositors for
the public exchequer. Our Bank has been a conduit for bringing foreign remittance from Bangladeshi expatriates living
abroad and thereby contributed to the overall foreign exchange reserve of the country. We contributed handsome amounts
to the national exchequer in the preceding years as corporate tax.

Annual Report - 20 10 79
Report on Corporate Social Responsibility

Southeast Bank Foundation


The Bank has also established the Southeast Bank Foundation to
participate in social work in a more organized manner. In 2009 the
Bank has suciently manned the Foundation to carry out activities
towards the promotion of high order CSR i.e. activities over and
beyond simple donation.

Under the Corporate Social Responsibilities (CSR), the


Foundation has identied education as the main eld of
responsibility and has initiated a Scholarship Project in the
Secondary Level to support meritorious students of poor and low
income families in the year 2009. It has begun with two layers
one for school students and the other for HSC Level College
Adan Islam, Executive Director, Dhoritri students.
Foundation is receiving a cheque of Tk.7,00,000/-
only on 8 August, 2010 from Chairman Alamgir
Kabir, FCA for social upliftment of Dalit people A huge number of Secondary Schools established in the rural areas of Bangladesh within last
and education of their children. two decades are yet to create conducive teaching environments mainly due to poorly trained
underpaid teachers. Though government has taken a number of
projects to address issues like training of teachers and stipend for
girl students, the overall gain regarding quality education is not
noteworthy.
Schools near and around the Southeast Bank Branches of rural and
semi-urban areas identied to be improved are included in the
project. The important components of the project are: a)
scholarship for meritorious students of low income families
studying from class VII class X, b) training of teachers, c)
enhancing facilities for library, science laboratory and computer
laboratory. The respective Southeast Bank Branches act as the focal
points of the scholarship program. Scholarship money for class VII
and VIII is Tk.600/- per month with a lump-sum amount of
Dr. Zaidi Sattar, Director, Southeast Bank Limited Tk.1,500/-. For students of class IX and X stipend money is
is seen (sitting in the middle) in the inaugural
session of a month long program: Training of Tk.1,000/- per month with a lump- sum amount of Tk.2,500/-. The stipend will be renewed
Teachers and Learners (TOTAL) held on December on the basis of annual results and class performances. The Foundation has selected 245
4, 2010 organized for secondary level English
Teachers of selected schools for improvement of students in 2010 in the School Level.
quality of English teaching in schools.
The Southeast Bank Foundation has organized a month long
English Course titled - Training of Teachers and Learners
(TOTAL) for the English teachers of selected schools in December,
2010. This Course has been primarily designed to help them take
new steps and guidelines in teaching English in the Secondary
Level. Besides, two English Newspapers are being subscribed to
each of these schools as reading materials for both teachers and
students. Other innovative programs will be gradually included for
these schools based on their respective needs.

A country wide Scholarship Project for Higher Secondary students


has been undertaken from 2009. For students of class XI and XII
the scholarship money is Tk.1500/- per month with a lump- sum
amount of Tk.4,000/-. Applications are invited through a number
of daily newspapers. Students who pass SSC examination or
Mrs. Zohra Rahman, widow of late Poet Shamsur
Rahman and Chairman Alamgir Kabir, FCA are equivalent can apply for the SEB Foundations scholarship. Each student should have opened
seen, among others, in a photo session on 16 June, a SEB Account to realize the scholarship money. So far a number of 491 students are selected
2010 after the announcement that Southeast Bank
Foundation will contribute Tk.40,000.00 per for the SEB Foundation Scholarship.
month for ve years to her family to eke out living.

80 Annual Report - 20 10
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Southeast Bank Limited and its subsidiary
Consolidated Balance Sheet as at 31 December 2010

2010 2009
PROPERTY AND ASSETS Notes
Taka Taka

Cash 4
In hand (including foreign currencies) 826,992,106 606,493,449
Balance with Bangladesh Bank and its agent bank
(including foreign currencies) 6,468,590,498 5,413,864,130
7,295,582,604 6,020,357,579
Balance with other banks and financial institutions 5(a)
In Bangladesh 1,972,298,388 87,767,997
Outside Bangladesh 1,058,808,731 734,577,920
3,031,107,119 1,122,345,917
Money at call on short notice 6 509,500,000 189,700,000
Investments 7 (a)
Government 16,603,461,142 19,407,606,604
Others 2,265,610,095 1,942,627,246
18,869,071,237 21,350,233,850
Loans and advances/investments 8(a)
Loans, cash credit, overdrafts etc./investments 88,408,896,195 73,466,742,724
Bills purchased and discounted 5,572,306,128 4,030,830,475
93,981,202,323 77,497,573,199
Fixed assets including premises, furniture and fixtures 9(a) 4,463,638,993 4,323,590,535
Other assets 10(a) 3,634,168,250 2,173,183,844
Non - banking assets - -
Total assets 131,784,270,526 112,676,984,924

LIABILITIES AND CAPITAL


Liabilities
Borrowings from other banks, financial institutions and agents 11(a) 976,452,941 261,836,236

Deposits and other accounts 12(a)


Current/Al-wadeeah current accounts and other accounts 10,072,568,542 6,226,255,141
Bills payable 1,346,207,382 1,163,140,147
Savings bank/Mudaraba savings bank deposits 5,773,710,807 6,694,031,711
Fixed deposits/Mudaraba fixed deposits 90,060,703,587 82,585,625,140
Bearer certificates of deposit - -
Other deposits - -
107,253,190,318 96,669,052,139

Other liabilities 13(a) 6,308,520,096 4,416,919,262


Total liabilities 114,538,163,355 101,347,807,637
Capital/shareholders' equity
Paid up capital 14.2 6,930,840,400 3,422,637,300
Share premium 1,386,168,060 -
Statutory reserve 15 3,650,252,294 2,665,605,000
Revaluation reserve 16 3,151,727,770 3,710,209,074
Other reserves 17 247,650,000 251,854,046
Retained earnings 18(a) 1,779,358,967 1,278,871,867
Total shareholders' equity 17,145,997,491 11,329,177,287
Non-controlling interest 19 100,109,680 -
Total liabilities and shareholders' equity 131,784,270,526 112,676,984,924

90 Annual Report - 20 10
Southeast Bank Limited and its subsidiary
Consolidated Balance Sheet as at 31 December 2010

2010 2009
OFF-BALANCE SHEET ITEMS Notes
Taka Taka

Contingent liabilities 20
Acceptances and endorsements 24,625,818,168 12,020,156,780
Letters of guarantee 6,701,765,198 6,034,183,466
Irrevocable letters of credit 22,425,566,090 15,013,644,393
Bills for collection 3,628,745,629 2,059,440,636
Value of Bangladesh Sanchaypatra 632,084,000 523,555,000
58,013,979,085 35,650,980,275
Other commitments
Documentary credits and short term trade-related transactions - -
Forward assets purchased and forward deposits placed - -
Undrawn note issuance and revolving underwriting facilities - -
Undrawn formal standby facilities, credit lines and other commitments - -
- -
58,013,979,085 35,650,980,275
Total off-balance sheet items including contingent liabilities 58,013,979,085 35,650,980,275

The annexed notes 1 to 41 form an integral part of these financial statements.

Chairman Vice Chairman Director Managing Director

As per our report of same date.

Dhaka, 20 February 2011


Auditors
Rahman Rahman Huq
Chartered Accountants

Annual Report - 20 10 91
Southeast Bank Limited and its subsidiary
Consolidated Profit and Loss Account for the year ended 31 December 2010
2010 2009
Notes
Taka Taka
Interest income/profit on investments 22(a) 10,275,162,797 8,962,092,477
Interest paid/profit shared on deposits and borrowings etc. 23(a) (7,593,806,743) (7,555,998,616)
Net interest income/net profit on investments 2,681,356,054 1,406,093,861
Investment income 24 3,788,427,272 2,615,816,028
Commission, exchange and brokerage 25 1,700,994,440 1,644,226,192
Other operating income 26(a) 336,228,093 193,078,837
5,825,649,805 4,453,121,057
Total operating income (A) 8,507,005,859 5,859,214,918
Salaries and allowances 27(a) 729,434,438 526,015,328
Rent, taxes, insurance, electricity etc. 28(a) 228,512,945 170,558,136
Legal expenses 294,149 359,253
Postage, stamp, telecommunication etc. 29(a) 78,333,486 54,018,201
Stationery, printing, advertisements etc. 30(a) 80,690,086 66,715,189
Managing Director's salary and fees 31 10,350,000 9,207,250
Directors' fees and expenses 32(a) 3,040,379 3,440,553
Auditors' fees 33 525,000 500,000
Depreciation and repair of Bank's assets 34(a) 183,496,709 121,238,874
Other expenses 35(a) 423,062,024 292,503,363
Total operating expenses (B) 1,737,739,216 1,244,556,147
Profit before provision (C=A-B) 6,769,266,643 4,614,658,771
Provision for loans and advances/investments 13.1
General provision 144,200,000 186,685,000
Specific provision 1,500,000,000 923,500,000
1,644,200,000 1,110,185,000
Provision for off-balance sheet items 13.2 202,950,000 38,300,000
Provision for diminution in value of investments 36(a) (8,288,385) -
Other provisions 1,000,000 14,409,000
Total provision (D) 1,839,861,615 1,162,894,000
Total profit before tax (C-D) 4,929,405,028 3,451,764,771
Provision for taxation 37(a)
Current 2,150,972,000 1,581,579,531
Deferred 14,500,000 -
2,165,472,000 1,581,579,531
Net profit after tax 2,763,933,028 1,870,185,240
Net profit after tax attributable to:
Equity holders' of the Bank 2,763,853,348 1,870,185,240
Non-controlling interest 79,680 -
Net profit after tax 2,763,933,028 1,870,185,240
Appropriations
Statutory reserve 15 984,647,294 690,353,200
General reserve - -
984,647,294 690,353,200
Retained surplus 1,779,285,734 1,179,832,040
Earnings per share (par value Taka 100) 40(a) 45.21 32.44

Chairman Vice Chairman Director Managing Director


As per our report of same date.
Dhaka, 20 February 2011

Auditors
Rahman Rahman Huq
92 Chartered Accountants Annual Report - 20 10
Southeast Bank Limited and its subsidiary
Consolidated Statement of Changes in Equity for the year ended 31 December 2010
Paid up Statutory Share Revaluation Other Retained Non-controlling
Total

Annual Report - 20 10
Particulars capital reserve premium reserve reserves earnings interest
(Taka) (Taka) (Taka) (Taka) (Taka) (Taka) (Taka) (Taka)

Balance as at 1 January 2009 2,852,197,800 1,975,251,800 485,930,025 1,249,249,803 251,854,046 542,790,957 - 7,357,274,431

Statutory reserve - 690,353,200 - - - (690,353,200) - -


Revaluation reserve - - - 2,460,959,271 - - - 2,460,959,271
Issue of bonus share 570,439,500 - (485,930,025) - - (84,509,475) - -
Cash dividend - - - - - (427,829,670) - (427,829,670)
Adjustment of deferred tax liabilities - - - - - 26,325,015 - 26,325,015
Diminution in value of investments - - - - - 72,263,000 - 72,263,000
Transfer to SEBL Foundation - - - - - (30,000,000) - (30,000,000)
Net profit for the year - - - - - 1,870,185,240 - 1,870,185,240
Balance as at 31 December 2009 3,422,637,300 2,665,605,000 - 3,710,209,074 251,854,046 1,278,871,867 - 11,329,177,287

Statutory reserve - 984,647,294 - - - (984,647,294) - -


Revaluation reserve - - - (558,481,304) - - - (558,481,304)
Issue of bonus share 1,197,923,000 - - - - (1,197,923,000) - -
Issue of right share 2,310,280,100 - 1,386,168,060 - - - - 3,696,448,160
Exchange equalization reserve - - - - (4,204,046) 4,204,046 - -
Transfer to SEBL Foundation - - - - - (50,000,000) - (50,000,000)
Transfer to SEBL Employees' welfare fund - - - - - (35,000,000) - (35,000,000)
Net profit for the year - - - - - 2,763,853,348 - 2,763,853,348
Non-controlling interest - - - - - - 100,109,680 100,109,680
Balance as at 31 December 2010 6,930,840,400 3,650,252,294 1,386,168,060 3,151,727,770 247,650,000 1,779,358,967 100,109,680 17,246,107,171

93
Southeast Bank Limited and its subsidiary
Consolidated Cash Flow Statement for the year ended 31 December 2010
2010 2009
Notes
Taka Taka
A) Cash flows from operating activities:
Interest receipts 11,735,054,080 10,509,289,650
Interest payments (8,354,903,258) (7,425,614,632)
Dividends receipts 35,198,093 15,500,611
Fee and commission receipts 1,700,994,440 1,644,226,192
Recoveries on Loans previously written-off 25,100,439 3,827,501
Payments to employees (739,784,437) (535,222,578)
Payments to suppliers (101,002,935) (68,951,459)
Income taxes paid (1,870,473,293) (1,405,698,677)
Receipts from other operating activities 38(a) 426,797,349 189,251,336
Payments for other operating activities 39(a) (730,182,270) (579,529,930)
Operating profit before changes in operating assets and liabilities (i) 2,126,798,208 2,347,078,014
Increase/decrease in operating assets and liabilities:
Sale of trading securities 10,319,595,939 2,195,701,194
Purchase of trading securities (8,437,665,084) (1,486,681,267)
Loans and advances to customers (16,483,629,124) (17,216,312,810)
Other assets (1,353,574,960) (737,255,105)
Deposits from other banks 714,616,705 (1,300,156,889)
Deposits from customers 11,345,234,692 27,536,758,170
Other liabilities (516,416,558) (511,880,820)
Cash (used in)/received from operating assets and liabilities (ii) (4,411,838,390) 8,480,172,473
Net cash (outflow)/inflow from operating activities (i+ii) (2,285,404,182) 10,827,250,487
B) Cash flows from investing activities
Proceeds from sale of securities 118,108,945,703 12,837,225,250
Payment for purchase of securities (120,075,712,423) (20,966,627,782)
Purchase of fixed assets (260,030,070) (675,645,178)
Sale of fixed assets 4,057,778 533,157
Net cash outflow from investing activities (2,222,739,012) (8,804,514,553)
C) Cash flows from financing activities:
Payment of dividend - (427,829,670)
Payment against lease obligation (16,191,990) (29,122,069)
Receipts from issue of ordinary shares of Southeast Bank Capital Services Limited 100,030,000 -
Receipts from issue of right shares 3,696,448,160 -
Net cash flow from financing activities 3,780,286,170 (456,951,739)
D) Net (decrease)/increase in cash and cash equivalents (A+B+C) (727,493,024) 1,565,784,195
E) Cash and cash equivalents at beginning of the year 12,844,289,866 11,278,505,671
F) Cash and cash equivalents at end of the year (D+E) 12,116,796,842 12,844,289,866
Cash and cash equivalents at end of the year represents
Cash in hand (including foreign currencies) 826,992,106 606,493,449
Balance with Bangladesh Bank and its agent bank
(including foreign currencies) 6,468,590,498 5,413,864,130
Balance with other banks and financial institutions 3,031,107,119 1,122,345,917
Money at call and on short notice 509,500,000 189,700,000
Treasury bills 1,276,504,519 5,506,036,370
Prize bond 4,102,600 5,850,000
12,116,796,842 12,844,289,866

94 Annual Report - 20 10
Southeast Bank Limited
Balance Sheet as at 31 December 2010
2010 2009
Notes
Taka Taka
PROPERTY AND ASSETS

Cash
In hand (including foreign currencies) 826,992,106 606,493,449
Balance with Bangladesh Bank and its agent bank
(including foreign currencies) 6,468,590,498 5,413,864,130
7,295,582,604 6,020,357,579
Balance with other banks and financial institutions 5
In Bangladesh 1,972,298,388 387,767,997
Outside Bangladesh 1,058,808,731 734,577,920
3,031,107,119 1,122,345,917
Money at call on short notice 6 509,500,000 189,700,000
Investments 7
Government 16,603,461,142 19,407,606,604
Others 1,724,186,131 1,942,627,246
18,327,647,273 21,350,233,850
Loans and advances/investments 8
Loans, cash credit, overdrafts etc./investments 86,880,309,365 73,466,742,724
Bills purchased and discounted 5,572,306,128 4,030,830,475
92,452,615,493 77,497,573,199
Fixed assets including premises, furniture and fixtures 9 4,463,082,010 4,323,590,535
Other assets 10 5,863,941,651 2,173,183,844
Non - banking assets - -
Total assets 131,943,476,150 112,676,984,924

LIABILITIES AND CAPITAL

Liabilities
Borrowings from other banks, financial institutions and agents 11 976,452,941 261,836,236

Deposits and other accounts 12


Current/Al-wadeeah current accounts and other accounts 10,048,965,997 6,226,255,141
Bills payable 1,346,207,382 1,163,140,147
Savings bank/Mudaraba savings bank deposits 5,773,710,807 6,694,031,711
Fixed deposits/Mudaraba fixed deposits 90,560,703,587 82,585,625,140
Bearer certificates of deposit - -
Other deposits - -
107,729,587,773 96,669,052,139

Other liabilities 13 6,092,154,825 4,416,919,262


Total liabilities 114,798,195,539 101,347,807,637
Capital/shareholders' equity
Paid up capital 14.2 6,930,840,400 3,422,637,300
Share premium 1,386,168,060 -
Statutory reserve 15 3,650,252,294 2,665,605,000
Revaluation reserve 16 3,151,727,770 3,710,209,074
Other reserves 17 247,650,000 251,854,046
Retained earnings 18 1,778,642,087 1,278,871,867
Total shareholders' equity 17,145,280,611 11,329,177,287
Total liabilities and shareholders' equity 131,943,476,150 112,676,984,924

Annual Report - 20 10 95
Southeast Bank Limited
Balance Sheet as at 31 December 2010
2010 2009
Notes
Taka Taka
OFF-BALANCE SHEET ITEMS
Contingent liabilities 20
Acceptances and endorsements 24,625,818,168 12,020,156,780
Letters of guarantee 6,701,765,198 6,034,183,466
Irrevocable letters of credit 22,425,566,090 15,013,644,393
Bills for collection 3,628,745,629 2,059,440,636
Value of Bangladesh Sanchaypatra 632,084,000 523,555,000
58,013,979,085 35,650,980,275
Other commitments
Documentary credits and short term trade-related transactions - -
Forward assets purchased and forward deposits placed - -
Undrawn note issuance and revolving underwriting facilities - -
Undrawn formal standby facilities, credit lines and other commitments - -
- -
58,013,979,085 35,650,980,275
Total off-balance sheet items including contingent liabilities 58,013,979,085 35,650,980,275

The annexed notes 1 to 41 form an integral part of these financial statements.

Chairman Vice Chairman Director Managing Director

As per our report of same date.


Dhaka, 20 February 2011

Auditors
Rahman Rahman Huq
Chartered Accountants

96 Annual Report - 20 10
Southeast Bank Limited
Profit and Loss Account for the year ended 31 December 2010
2010 2009
Notes
Taka Taka
Interest income/profit on investments 22 10,257,037,859 8,962,092,477
Interest paid/profit shared on deposits and borrowings etc. 23 (7,580,851,090) (7,555,998,616)
Net interest income/net profit on investments 2,676,186,769 1,406,093,861
Investment income 24 3,788,427,272 2,615,816,028
Commission, exchange and brokerage 25 1,700,994,440 1,644,226,192
Other operating income 26 324,873,820 193,078,837
5,814,295,532 4,453,121,057
Total operating income (A) 8,490,482,301 5,859,214,918

Salaries and allowances 27 729,128,338 526,015,328


Rent, taxes, insurance, electricity etc. 28 228,471,845 170,558,136
Legal expenses 294,149 359,253
Postage, stamp, telecommunication etc. 29 78,316,636 54,018,201
Stationery, printing, advertisements etc. 30 80,668,877 66,715,189
Managing Director's salary and fees 31 10,350,000 9,207,250
Directors' fees and expenses 32 3,010,379 3,440,553
Auditors' fees 33 500,000 500,000
Depreciation and repair of Bank's assets 34 183,357,463 121,238,874
Other expenses 35 421,443,131 292,503,363
Total operating expenses (B) 1,735,540,818 1,244,556,147
Profit before provision (C=A-B) 6,754,941,483 4,614,658,771
Provision for loans and advances/investments 13.1
General provision 144,200,000 186,685,000
Specific provision 1,500,000,000 923,500,000
1,644,200,000 1,110,185,000
Provision for off-balance sheet items 13.2 202,950,000 38,300,000
Revarsal of provision for diminution in value of investments 36 (16,444,985) -
Other provisions 1,000,000 14,409,000
Total provision (D) 1,831,705,015 1,162,894,000
Total profit before tax (C-D) 4,923,236,468 3,451,764,771
Provision for taxation 37
Current 2,145,600,000 1,581,579,531
Deferred 14,500,000 -
2,160,100,000 1,581,579,531
Net profit after tax 2,763,136,468 1,870,185,240

Appropriations
Statutory reserve 15 984,647,294 690,353,200
General reserve - -
984,647,294 690,353,200
Retained surplus 18 1,778,489,174 1,179,832,040

Earnings per share (par value Taka 100) 40 45.20 32.44

The annexed notes 1 to 41 form an integral part of these financial statements.

Chairman Vice Chairman Director Managing Director


As per our report of same date.
Dhaka, 20 February 2011
Auditors
Rahman Rahman Huq
Chartered Accountants
Annual Report - 20 10 97
98
Southeast Bank Limited
Statement of Changes in Equity for the year ended 31 December 2010
Paid up Statutory Share Revaluation Other Retained
Particulars capital reserve premium reserve reserves earnings Total
(Taka) (Taka) (Taka) (Taka) (Taka) (Taka) (Taka)

Balance as at 1 January 2009 2,852,197,800 1,975,251,800 485,930,025 1,249,249,803 251,854,046 542,790,957 7,357,274,431

Statutory reserve - 690,353,200 - - - (690,353,200) -


Revaluation reserve - - - 2,460,959,271 - - 2,460,959,271
Issue of bonus share 570,439,500 - (485,930,025) - - (84,509,475) -
Cash dividend - - - - - (427,829,670) (427,829,670)
Adjustment of deferred tax liabilities - - - - - 26,325,015 26,325,015
Diminution in value of investments - - - - - 72,263,000 72,263,000
Transfer to SEBL Foundation - - - - - (30,000,000) (30,000,000)
Net profit for the year - - - - - 1,870,185,240 1,870,185,240
Balance as at 31 December 2009 3,422,637,300 2,665,605,000 - 3,710,209,074 251,854,046 1,278,871,867 11,329,177,287

Statutory reserve - 984,647,294 - - - ( 984,647,294) -


Revaluation reserve - - - (558,481,304) - - (558,481,304)
Issue of bonus share 1,197,923,000 - - - - (1,197,923,000) -
Issue of right share 2,310,280,100 - 1,386,168,060 - - - 3,696,448,160
Exchange equalization reserve - - - - (4,204,046) 4,204,046 -
Transfer to SEBL Foundation - - - - - (50,000,000) (50,000,000)
Transfer to SEBL Employees' welfare fund - - - - - (35,000,000) (35,000,000)
Net profit for the year - - - - - 2,763,136,468 2,936,136,468
Balance as at 31 December 2010 6,930,840,400 3,650,252,294 1,386,168,060 3,151,727,770 247,650,000 1,778,642,087 17,145,280,611

Annual Report - 20 10
Southeast Bank Limited
Cash Flow Statement for the year ended 31 December 2010
2010 2009
Notes
Taka Taka
A) Cash flows from operating activities:
Interest receipts 11,716,929,142 10,509,289,650
Interest payments (8,341,947,605) (7,425,614,632)
Dividends receipts 35,198,093 15,500,611
Fee and commission receipts 1,700,994,440 1,644,226,192
Recoveries on Loans previously written-off 25,100,439 3,827,501
Payments to employees (739,478,337) (535,222,578)
Payments to suppliers (100,981,726) (68,951,459)
Income taxes paid (1,870,473,293) (1,405,698,677)
Receipts from other operating activities 38 415,443,076 189,251,336
Payments for other operating activities 39 (728,450,427) (579,529,930)
Operating profit before changes in operating assets and liabilities (i) 2,112,333,802 2,347,078,014
Increase/decrease in operating assets and liabilities:
Sale of trading securities 10,319,595,939 2,195,701,194
Purchase of trading securities (7,888,084,519) (1,486,681,267)
Loans and advances to customers (14,955,042,294) (17,216,312,810)
Other assets (3,581,984,237) (737,255,105)
Deposits from other banks 714,616,705 (1,300,156,889)
Deposits from customers 11,821,632,149 27,536,758,170
Other liabilities (728,773,956) (511,880,820)
Cash (used in)/received from operating assets and liabilities (ii) (4,298,040,213) 8,480,172,473
Net cash (outflow)/inflow from operating activities (i+ii) (2,185,706,411) 10,827,250,487
B) Cash flows from investing activities
Proceeds from sale of securities 117,665,845,085 12,837,225,250
Payment for purchase of securities (119,632,611,805) (20,966,627,782)
Purchase of fixed assets (259,333,841) (675,645,178)
Sale of fixed assets 4,057,778 533,157
Net cash inflow/(outflow) from investing activities (2,222,042,783) (8,804,514,553)
C) Cash flows from financing activities:

Payment of dividend - (427,829,670)


Payment against lease obligation (16,191,990) (29,122,069)
Receipts from issue of right shares 3,696,448,160 -
Net cash flow from financing activities 3,680,256,170 (456,951,739)
D) Net (decrease)/increase in cash and cash equivalents (A+B+C) (727,493,024) 1,565,784,195
E) Cash and cash equivalents at beginning of the year 12,844,289,866 11,278,505,671
F) Cash and cash equivalents at end of the year (D+E) 12,116,796,842 12,844,289,866
Cash and cash equivalents at end of the year represents
Cash in hand (including foreign currencies) 826,992,106 606,493,449
Balance with Bangladesh Bank and its agent bank
(including foreign currencies) 6,468,590,498 5,413,864,130
Balance with other banks and financial institutions 3,031,107,119 1,122,345,917
Money at call and on short notice 509,500,000 189,700,000
Treasury bills 1,276,504,519 5,506,036,370
Prize bond 4,102,600 5,850,000
12,116,796,842 12,844,289,866

Annual Report - 20 10 99
Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
1. Reporting entity

1.1 Status of the Bank

Southeast Bank Limited ("the Bank") is a scheduled commercial bank in the private sector established under the
Bank Companies Act 1991 and incorporated in Bangladesh as a public limited company to carry out banking
business in Bangladesh. The registered office of the Bank located at Eunoos Trade Centre 52-53, Dilkusha Com-
mercial Area (Level 2,3 &16), Dhaka-1000. The consolidated financial statements of the Bank as at and for the
year ended 31 December 2010 comprise the Bank and its subsidiary (together referred to as the Group and
individually as Group entities).

1.2 Principal activities of the Bank

The Bank has 76 branches, with no overseas branch as on 31 December 2010. Except 5 (five) branches of Islamic
banking the rest 71 branches run on commercial conventional basis, of which 15(fifteen) agricultural branches are
located across the country. The Bank offers services for all commercial banking needs of the customers, which
includes deposit banking, loans and advances, export import financing, inland and international remittance
facility etc. The Bank is listed with Dhaka Stock Exchange Limited and Chittagong Stock Exchange Limited as a
publicly traded company.

The Bank operates Islamic banking in 5 branches designated for the purpose in complying with the rules of
Islamic Shariah the modus operandi.

The bank has one subsidiary for its merchant banking operation (For details see note 1.5).

1.3 Islamic banking

The Bank obtained the Islamic Banking branches permission vide letter no. BRPD(P)745(22)/2003-2525 dated
28 June 2003, BRPD(P)745(22)/2004-1801 dated 9 May 2004 and BRPD(P)745(22)/2004-3957 dated 13
October 2004. The Islamic banking branches are governed under the rules and regulations of Bangladesh Bank.

1.4 Off-Shore Banking

In order to cater the varied financial needs of 100% foreign owned/joint venture industrial units and foreign
entities located in Export Processing Zones of the country, The Bank obtained Off-Shore Banking License on 24th
June 2008 vide letter no. BRPD(P-3)744(98)/2008-2213 from Bangladesh Bank. Presently the Bank has 2 (two)
off-shore banking units - one at Dhaka Export Processing Zone and the other at Chittagong Export Processing
Zone. Off-shore banking unit is governed under the rules and regulations of Bangladesh Bank.

1.5 Southeast Bank Capital Services Limited

Southeast Bank Capital Services Limited is a subsidiary of Southeast Bank Limited which was incorporated on
23 September 2010 and commenced its operation from 1 December 2010. The Bank has transferred its
Merchant Banking operation to the newly formed subsidiary company in pursuance of the direction of
Bangladesh Bank vide DOS Circular No. 4 dated 15 June 2010. The principal activities of the subsidiary
company is to provide quality services to the prospective institutional and individual investors in the Capital
Market. It is decisively providing the following services:
i) Portfolio Management Services
ii) Underwriting of Share
iii) Issue Management Services etc.
Due to separation of the Bank's merchant banking unit opearation the following assets and liabilities were
transferred to Southeast Bank Capital Services Limited:

i) Cash at bank
ii) Margin loan
iii) Fixed assets

100 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2. Basis of preparation of the financial statements

2.1 Statement of compliance

The consolidated financial statements of the Group and the financial statements of the Bank are made up to 31
December each year and are prepared in accordance with the First Schedule (Sec. 38) of the Bank Companies Act
1991 as amended by the BRPD Circular No. 14 dated 25 June 2003, other Bangladesh Bank Circulars, Interna-
tional Financial Reporting Standards (IFRSs) as adopted by the Institute of Chartered Accountants of Bangladesh
(ICAB) as Bangladesh Financial Reporting Standards (BFRSs), the Companies Act 1994, the Securities and
Exchange Rules 1987 and other prevailing laws and regulations applicable in Bangladesh.

The financial statements of the Islamic banking branches has also been prepared as per Bank Companies Act
1991, Bangladesh Financial Reporting Standards (BFRSs) and other prevailing laws and regulations applicable in
Bangladesh

A separate balance sheet and profit and loss account are shown in Annexure - I and I.1 and the figures appearing
in the annexure have been converted into relevant heads of financial statements under conventional banking for
consolidation and incorporation in these financial statements.

The consolidated financial statements were approved by the Board of Directors on 20 February 2011.

2.2 Basis of measurement

The financial statements of the Bank have been prepared on the historical cost basis except for the following:

- Government Treasury Bills and Bonds designated as 'Held for Trading (HFT)' at present value using marking
to market concept with gain crediting revaluation reserve.

- Government Treasury Bills and Bonds designated as 'Held to Maturity (HTM)' at present value using amortisa-
tion concept

2.3 Basis of consolidation

The consolidated financial statements include the financial statements of Southeast Bank Limited and its subsid-
iary Southeast Bank Capital Services Limited, made up to the end of the financial year.

The consolidated financial statements have been prepared in accordance with Bangladesh Accounting Standard
27: Consolidated and Separate Financial Statements. The consolidated financial statements are prepared to a
common financial year ended 31 December 2010.

Figures in the comparative were not consolidated amounts as there was no subsidiary in 2009 to consolidate.

Subsidiary

Subsidiary is that enterprise which is controlled by the Bank. Control exists when the Bank has the power, directly
or indirectly, to govern the financial and operating policies of an enterprise. The financial statements of subsidiary
are included in the consolidated financial statements from the date that control effectively commences until the
date that the control effectively ceases. Subsidiary company is consolidated using the purchase method of
accounting.

Transactions eliminated on consolidation

Intra-group balances, and income and expenses (except for foreign currency transaction gains or losses) arising
from intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised losses
are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

2.4 Functional and presentation currency

These financial statements are presented in Bangladesh Taka (Tk) which is the Bank's functional currency. Except
as otherwise indicated, financial information presented has been rounded to the nearest Taka.

Annual Report - 20 10 101


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2.5 Use of estimates and judgements

The preparation of the consolidated financial statements in conformity with BFRSs requires management to make
judgements, estimates and assumptions that affect the application of accounting policies and the reported
amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised and in any future periods affected.

Information about significant areas of estimation uncertainty and critical judgements in applying accounting
policies that have the most significant effect on the amounts recognised in the consolidated financial statements
are described in notes 3.1.4 and 3.10.

2.6 Foreign currency conversion

Transactions in foreign currencies are translated into the respective functional currency of the operation at the
spot exchange rate at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies
at the reporting date are retranslated into the functional currency at the spot exchange rate at that date. The
foreign currency gain or loss on monetary items is the difference between amortised cost in the functional
currency at the beginning of the period, adjusted for effective interest and payments during the period, and the
amortised cost in foreign currency translated at the spot exchange rate at the end of the period. Non-monetary
assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated into the
functional currency at the spot exchange rate at the date that the fair value was determined. Foreign currency
differences arising on retranslation are recognised in profit or loss. Non-monetary assets and liabilities that are
measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the
transaction.

2.7 Reporting period

These financial statements cover one calendar year form 1 January to 31 December 2010.

2.8 Cash flow statement

Cash flow statement has been prepared in accordance with the Bangladesh Accounting Standard-7 " Statement of
Cash Flows" under direct method as recommended in the BRPD Circular No. 14 dated 25 June 2003 issued by
the Banking Regulation & Policy Department of Bangladesh Bank.

2.9 Statement of Changes in Equity

The Statement of changes in equity reflects information about the increase or decrease in net assets or wealth.

2.10 Liquidity Statement

The liquidity statement of assets and liabilities as on the reporting date has been prepared on residual maturity
term which has been given in the Statement.

2.11 Adoption of new accounting standards

Adoption of new accounting standards with effective from 1 January 2010 the Group/Bank has adopted the
following Bangladesh Financial Reporting Standards:

i) BFRS 4 : Insurance Contracts


ii) BFRS 7 : Financial Instruments: Disclosures
iii) BFRS 8 : Operating Segments
iv) BAS 32: Financial Instruments: Presentation
v) BAS 39 : Financial Instruments: Recognition and Measuremenrs

102 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

3. Significant accounting policies

The accounting policy set out below have applied consistently to all periods presented in these consolidated finan-
cial statements and those of the Bank, and have been applied consistently by the group entities except as explain
in note 3.14.1.

3.1 Assets and basis of their valuation


3.1.1 Cash and cash equivalents
Cash and cash equivalents include notes and coins on hand, unrestricted balances held with Bangladesh Bank and
its agent bank, balance with other banks and financial institutions, money at call and on short notice, investments
in treasury bills and prize bond.
3.1.2 Investments
All investment securities are initially recognised at cost, including acquisition charges associated with the invest-
ment. Premiums are amortised and discounts are accredited.
Held to Maturity
Investments which have, 'fixed or determinable payments' and are intended to be held to maturity are classified
as 'Held to Maturity'.
Held for Trading
Investment classified in this category are acquired principally for the purpose of selling or repurchasing in short
trading or if designated as such by the management.
Revaluation
As per the DOS Circular letter no. 5 dated 26 May 2008, HFT securities are revaluated each week using Marking
to Market concept and HTM securities are amortised once a year according to Bangladesh Bank guidelines.

Value of investments has been shown as under:

Government Treasury Bills and Bonds (HFT) At present value (using marking to market concept)
Government Treasury Bills and Bonds (HTM) At present value (using amortisation concept)
Prize Bond At cost
Unquoted shares At cost or book value of the last audited balance sheet
whichever is lower
Quoted shares At cost or market value whichever is lower at balance sheet date.

Details are shown in Note-7.

3.1.3 Loans, Advances/Investments and provisions

a) Loans and advances of conventional Banking/Investments of Islamic Banking branches are stated in the
Balance Sheet on gross value.

b) Provision for loans and advances is made on the basis of periodical review by the management and of instruc-
tions contained in Bangladesh Bank BRPD circulars no. 16 of 6 December 1998, 9 of 14 May 2001, 9 and 10
of 20 August 2005, 5 of 5 June 2006, 8 of 7 August 2007, 10 of 18 September 2007, 5 of 29 April 2008 and
BRPD Circular No. 32 of 27 October 2010. The rates of provision for different classifications are given below:

Annual Report - 20 10 103


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

Particulars Rate
General provision on:
All unclassified loans and advances/investments except followings 1%
Small and medium enterprise financing 2%
Consumer finance for house building loan and loans for professional setup 2%
Loan to BHs/MBs/SDs against shares 2%
Other consumer finance 5%
Special mention account 5%
Specific provision on:
Substandard loans and advances/investments 20%
Doubtful loans and advances/investments 50%
Bad/loss loans and advances/investments 100%

c) Loans and advances are written off to the extent that


i) there is no realistic prospect of recovery, and

ii) against which legal cases are filed and classified as bad loss for more than five years as per guidelines of Bangla-
desh Bank.

These write off however will not undermine/affect the claim amount against the borrower. Detailed memoran-
dum records for all such write off accounts are maintained and followed up.

d) Amounts receivable on credit cards are included in advances to customers at the amounts expected to be recov-
ered.

Details are shown in Note 8.

3.1.4 Fixed assets and depreciation

Recognition and measurement

Items of fixed assets excluding land are measured at cost/revaluation less accumulated depreciation and accumu-
lated impairment losses, if any. Land is measured at cost/revaluation.

Cost includes expenditure that are directly attributable to the acquisition of asset and bringing to the location and
condition necessary for it to be capable of operating in the intended manner.

Subsequent costs

The cost of replacing part of an item of fixed assets is recognised in the carrying amount of the item if it is probable
that the future economic benefits embodied within the part will flow to the company and its cost can be measured
reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of fixed
assets are recognised in profit or loss as incurred.

Depreciation

Depreciation is charged on reducing balance method. In case of acquisition of fixed assets, depreciation is charged
from the month of acquisition, whereas depreciation on disposed off fixed assets is charged up to the month prior
to the disposal. Asset category-wise depreciation rates are as follows:

104 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

Category of assets Rate of depreciation

Land Nil
Building 4%
Furniture and fixtures 10%
Office appliances 20%
Electrical appliances 20%
Motor vehicles 20%

Gain or loss on sale of fixed assets are recognised in profit and loss account as per provision of BAS 16 "Property,
plant and equipments".
3.1.5 Leased assets lessee
Leases in terms of which the Group assumes substantially all the risks and rewards of ownership are classified as
finance leases. Upon initial recognition the leased asset is measured at an amount equal to the lower of its fair value
and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted
for in accordance with the accounting policy applicable to that asset.

Other leases are operating leases and, except for investment property, the leased assets are not recognised in the
Groups Balance sheet. Investment property held under an operating lease is recognised in the Groups Balance
sheet at its fair value.

3.2 Liabilities and basis of their valuation

3.2.1 Borrowings from other banks, financial institutions and agents

Borrowings from other banks, financial institutions and agents includes refinance from Bangladesh Bank against
agro-based credit, SME Loan etc., interest-bearing borrowings against securities from Bangladesh Bank and call
borrowing from other banks. These items are brought to financial statements at the gross value of the outstanding
balance. Details are shown in Note 11.

3.2.2 Deposits and other accounts


Deposits and other accounts include non interest-bearing current deposit redeemable at call, interest bearing on
demand and short-term deposits, savings deposit and fixed deposit. These items are brought to financial
statements at the gross value of the outstanding balance. Details are shown in Note 12.

3.2.3 Other liabilities


Other liabilities comprise items such as provision for loans and advances/investments, provision for taxation,
interest payable, interest suspense, accrued expenses, obligation under finance lease etc. Other liabilities are recog-
nised in the balance sheet according to the guidelines of Bangladesh Bank, Income Tax Ordinance 1984 and
internal policy of the Bank. Details are shown in Note 13.

3.3 Capital/shareholders' equity

Authorised capital
Authorised capital is the maximum amount of share capital that the Bank is authorised by its Memorandum and
Articles of Association.

Paid up capital
Paid up capital represents total amount of shareholder capital that has been paid in full by the ordinary sharehold-
ers. Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to
vote at shareholders meetings. In the event of a winding-up of the Bank, ordinary shareholders rank after all other
shareholders and creditors and are fully entitled to any residual proceeds of liquidation. Details are shown in
Note 14.2.

Annual Report - 20 10 105


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

Statutory reserve

Statutory reserve has been maintained @ 20% of profit before tax in accordance with provisions of section 24 of
the Bank Companies Act 1991 until such reserve equal to its paid up capital together with the share premium.

Revaluation reserve

Revaluation reserve arises from the revaluation of Treasury bills and bonds (HFT & HTM) in accordance with
the DOS circular no. 5 dated 26 May 2008 and DOS(SR) 1153/120/2010 dated 8 December 2010. The tax
effects on revaluation gain are measured and recognised in the financial statements as per BAS 12: Income Taxes.

3.4 Contingent liabilities

A contingent liability is -

A possible obligation that arises from past events and the existence of which will be confirmed only by the occur-
rence or non-occurrence of one or more uncertain future events not wholly within the control of the Bank; or

A present obligation that arises from past events but is not recognised because:

* it is not probable that an outflow of resources embodying economic benefits will be required to settle the obliga-
tion; or

* the amount of the obligation cannot be measured with sufficient reliability.

Contingent liabilities are not recognised but disclosed in the financial statements unless the possibility of an
outflow of resources embodying economic benefits is reliably estimated.

Contingent assets are not recognised in the financial statements as this may results in the recognition of income
which may never be realised.

3.5 Revenue recognition

Interest income

"Interest on loans and advances is calculated on daily product basis, but charged and accounted for on quarterly
basis. Interest on loans and advances ceases to be taken into income when such advances fall into SMA and under
classification. It is then kept in interest suspense account. Interest on SMA and classified loans and advances is
accounted for on a cash receipt basis. Interest is not charged on bad and loss loans as per guideline of Bangladesh
Bank. Such interest is kept in separate memorandum account.

Profit on investment (Islamic Banking)

Mark-up on investment is taken into income account proportionately from profit receivable account. Overdue
charge/compensation on classified investments is transferred to profit suspense account instead of income
account.

Investment income

Income on investments is recognised on accrual basis. Investment income includes discount on treasury bills,
interest on treasury bonds and fixed deposit with other banks. Capital gain on investments in shares is also
included in investment income. Capital gain is recognised when it is realised.

Fees and commission income

The Bank earns fees and commissions from diverse range of services provided to its customers. Fees and commis-
sion income is recognised on a realisation basis. Commission charged to customers on letters of credit and letters
of guarantee are credited to income at the time of effecting the transactions.

106 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

Interest paid on borrowing and other deposits (Conventional banking)

Interest paid and other expenses are recognised on accrual basis.

Profit Shared on deposits (Islamic Banking)

Profit shared to mudaraba deposits is recognised on accrual basis as per provisional rate.

3.6 Employee benefits

3.6.1 Provident Fund

Provident fund benefits are given to the staff of the Bank in accordance with the registered provident fund rules.
The commissioner of Income Tax, Large Tax Payers Unit, Dhaka has approved the Provident Fund as a recognized
fund within the meaning of section 2(52) read with the provisions of part - B of the First Schedule of Income Tax
Ordinance 1984. The fund is operated by a Board of Trustees consisting of 6 (six) members of the Bank. All
confirmed employees of the Bank are contributing 10% of their basic salary as subscription of the fund. The Bank
also contributes equal amount to the fund. Contributions made by the Bank are charged as expense. Interest
earned from the investments is credited to the members' account on half yearly basis. Members are eligible to get
both the contribution after 5 (five) years of continuous service from the date of their membership.

3.6.2 Gratuity Fund

Gratuity fund benefits are given to the staff of the Bank in accordance with the approved gratuity fund rules.
National Board of Revenue has approved the gratuity fund as a recognized gratuity fund with effect from Decem-
ber 2001. The fund is operated by a Board of Trustees consisting of 7 (seven) members of the Bank. Employees
are entitled to gratuity benefit after completion of minimum 7 (seven) years of service in the Bank. Actuarial
valuation is not considered essential since amount payable at the date of balance sheet is recognised and accounted
for as at that date based on actual rate. The gratuity is calculated on the basis of last basic pay and is payable at the
rate of one month's basic pay for every completed year of service. The amount so calculated are transferred to the
fund and charged to expenses of the Bank.

3.6.3 Superannuation Fund

The Bank operates a Superannuation Fund covering all its eligible employees. The Fund is operated by a separate
Board of Trustees.

3.7 Provisions and accrued expenses

In compliance with BAS-37, provisions and accrued expenses are recognized in the consolidated financial
statements when the Group has a legal or constructive obligation as a result of past event, it is probable that an
outflow of economic benefit will be required to settle the obligation and a reliable estimate can be made of the
amount of the obligation.

3.8 Provision for Off-Balance Sheet Exposures

In compliance with Bangladesh Bank guidelines Off-Balance Sheet items have been disclose under contingent
liabilities. As per BRPD Circular No.10 dated 18 September 2007, the Bank is required to maintain provision @
1% against Off-Balance Sheet Exposures. Details are shown in note 13.2

3.9 Provision for Nostro Accounts

According to guideline of Foreign Exchange Policy Department of Bangladesh Bank, Circular No. FEOD
(FEMO)/01/2005-677 dated 13 September 2005, Bank is not required to make provision regarding the
un-reconciled debit balance as at Balance Sheet date since there was no debit entries more than three month.

Annual Report - 20 10 107


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
3.10 Taxation
Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in profit or
loss except to the extent that it relates to items recognised directly in equity.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates
enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous
years.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the
following temporary differences: the initial recognition of goodwill, the initial recognition of assets or liabilities in
a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and
differences relating to investments in subsidiaries to the extent that it is probable that they will not reverse in the
foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differ-
ences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities
against current tax assets, and they relate to income taxes levied by the same tax authority on the same taxable
entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their
tax assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences to the
extent that it is probable that future taxable profits will be available against which they can be utilised. Deferred
tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the
related tax benefit will be realised.
Deferred tax relating to unrealised surplus on revaluation of held to maturity (HTM) securities and land and
buildings are recognised directly in revaluation reserve as a part of equity and is subsequently recognised in profit
and loss account on maturity of the security and disposal of land and buildings. Details are shown in note
13.4.2.
3.11 Earnings per share
The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated
by dividing the profit or loss attributable to ordinary shareholders of the Bank by the weighted average number of
ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attribut-
able to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of
all dilutive potential ordinary shares, which comprise share options granted to employees.
3.12 Reconciliation of inter-bank/inter-branch account
Books of accounts with regard to inter-bank (in Bangladesh and outside Bangladesh) are reconciled regularly and
there are no material differences which may affect the financial statements significantly.
Un-reconciled entries in case of inter-branch transactions as at the reporting date are not material.
3.13 Risk management
Risk is an integral part of the banking business and the Bank aims at delivering superior shareholder value by
achieving an appropriate trade-off between risk and return. The Banks risk management strategy is based on a
clear understanding of various risks, disciplined risk assessment and measurement procedures and continuous
monitoring. The Banks risk management policy defines the relationship between the risk management philoso-
phy, process and procedures. Developing and communicating the risk policy is an important step in ensuring that
risk is managed effectively at all levels of the Bank.
The framework under which the Risk Management Unit (RMU) would work is not one discrete policy, strategy
or document, rather it is composed of all the structure, policies, strategies and procedures within the Bank that
deal with risk management. The essential elements of an effective risk management framework are:
a) Clearly defined management responsibility and accountability.
b) Clear separation of responsibilities and reporting lines between risk management functions, business lines
and support functions to avoid conflict of interests.

108 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
c) Detailed risk controls for each business line.
d) A comprehensive and independent internal audit or compliance process for reviewing and testing internal
controls and risk management systems.
e) Strong risk governance and stewardship by the Board, which demonstrates an understanding of all major risks.
The risk management of the Bank covers following six core risk areas:
i) Credit Risk
ii) Foreign Exchange Risk
iii) Asset Liability Management
iv) Money Laundering Risk
v) Internal Control & Compliance
vi) Information and communication technology
3.13.1 Credit risk
Credit risk is the possibility that a borrower or counter party will fail to meet agreed obligations. Managing credit
risk for efficient management of a bank has become one of the most crucial tasks. Given the fast changing,
dynamic global economy and the increasing pressure of globalization and liberalization it is essential that banks
have robust credit risk management policies and procedures that are sensitive and responsive to this changes.

A thorough assessment is done before sanction of any credit facility at Credit Risk Management Division of the
Bank. The risk assessment includes borrower risk analysis, financial analysis, industry analysis, historical perfor-
mance of the customer, security of the proposed credit facility etc. The assessment process starts at Branch Credit
Division by the Officer and ends at Credit Risk Management Division when it is approved/declined by the
competent authority. Credit approval authority has been partially delegated to the individual executives/Credit
Committee. Proposals beyond their delegation are approved/declined by the Board.

In determining Single borrower/large loan limit, the instruction of Bangladesh Bank is strictly followed. Internal
Audit is conducted at periodical intervals to ensure compliance of the Banks and Regulators' policies.

3.13.2 Foreign Exchange Risk


Foreign exchange risk is defined as the potential change in earnings due to change in market prices. The Bank has
a Functional Instruction Manual covering foreign exchange risk policies and investment policy. The Bank has also
developed different strategies to handle foreign exchange risk by setting limits on Net Open Positions by curren-
cies, mismatch limits by currency and time buckets of Forward Foreign Exchange transactions, overall gross limits
for FWD transaction, Maximum Loss limits per day and per month, as well as Value at Risk limits which are
measured and monitored.

All treasury functions are disseminated and are separately overseen by treasury front office, mid office and back
office. The front office is involved only in dealing activities, the back office is responsible for passing of their entries
in the books of account and the mid office is responsible for verification of the deals. All foreign exchange transac-
tion are revalued at Mark-to-Market rate as per the directive of Bangladesh Bank. All Nostro accounts are recon-
ciled on a monthly basis and outstanding entry beyond 30 days is reviewed by the management for its settlement.

3.13.3 Asset Liability Management


Changes in market liquidity threaten the survival of a financial institution. As such, emphasis has been given on
ALM so that the level of the balance sheet risks are effectively managed, appropriate policies and procedures are
established to control and limit these risks and proper resources are available for evaluating and controlling these
risks. The Asset Liability Committee (ALCO) of the Bank monitors Balance Sheet risk and liquidity risk of the
Bank.

Asset Liability Committee (ALCO) reviews countrys overall economic position, the Banks Liquidity position,
ALM Ratios, Interest Rate Risk, Deposit Advance Growth, Cost of Deposit & yield on Advance, Market Interest
Rate, Loan loss provision adequacy and deposit and lending pricing strategy.

Annual Report - 20 10 109


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
3.13.4 Money Laundering Risk
Money Laundering is the participation in any transaction that seeks to conceal or disguise the nature or origin of
funds/assets derived from illegal activities, for example, fraud, forgery, corruption & bribery, trading of illegal
arms, drug trafficking, smuggling, theft or burglary, extortion, etc. It is a vital process of making the crime worth-
while and provides the fuel for drug dealers, smugglers, terrorists, illegal arms dealers, corrupt public officials and
others to operate and expand their criminal activities.
Southeast Bank Ltd has developed and enforced an Anti-Money Laundering and Anti Terrorist Financing
Program, which can deter criminals from using their facilities for money laundering, in order to ensure that the
Bank complies with the obligations under the law. This Program includes establishing adequate procedures for
customer due diligence, reporting, record keeping, internal control, risk management & communication in order
to forestall & prevent operations related to money laundering or financing of terrorism. The elements of the
program are communicated to all levels of personnel to ensure a thorough understanding of individual responsi-
bilities; the prompt identification of unusual activity to senior management and maintaining record retention
requirements set forth by the law of the Country.
3.13.5 Internal Control & Compliance
Effective internal control is essential to a bank for management of risk and it is the foundation of safe and sound
banking. A good system of internal controls helps the management to safeguard the banks resources. The Board
of Directors and Management of Southeast Bank Limited (SEBL) take the plan of the Bank and adopt all the
methods, policies & procedures as per standard guidelines with a view to continually recognize and assess all of
the material risks that could adversely affect the achievement of the banks goals. The system of Internal Control
of SEBL has been designed with intention to provide reasonable assurance in achieving objectives against material
misstatement or loss and ensure the:
i) reliability of the financial information;
ii) effectiveness of operations;
iii) compliance with applicable laws and regulations;
iv) adherence to management policies;
v) safeguarding of Banks Assets;
vi) prevention and detection of fraud and errors; and
vii) accuracy and completeness of the accounting records.
Board of Directors, Board Audit Committee, Senior Management, each Division of Head Office including
Internal Control & Compliance Division and Branches of SEBL are discharging their role on the issue of manag-
ing the risk of Internal Control & Compliance effectively.

3.13.6 Information and Communication Technology


Information assets are critical to the services provided by the Bank to its customers. Protection and maintenance
of these assets are critical to its sustainability. Todays ICT infrastructure is more often logical and virtual in nature
rather than physical. It requires logical approach to define critical functions for assessing threats and vulnerabilities
and consequences of loss, degradation, or compromise of these functions rather than physical assets or locations.
The Bank has already taken initiatives to protect the information from unauthorized access, modification, disclo-
sure and destruction to protect customers interest. The Bank has already introduced number of logical protection
levels between web layer and its core application and database layer.
In general, ICT risk management is embedded in organizational internal control and audit which are widely used
as part of the management control for risk management in organization. This management control emphasizes
both business control and technological control which support business requirements and governance. Business
and technological controls are involved in the policies, processes, systems and people in the organization. The
Bank has already revised its own ICT policies on ICT Training, Problem Management, Data Encryption, Business
Continuity, Backup and Restore, and SLA (Service Level Agreement). The topics are very detailed and are closely
in line with the ICT guideline of Bangladesh Bank. The Bank has developed a critical human resource backup
plan with detail job description for each IT personnel, segregation of duties for IT tasks and system support in
respect of severity. Further to safeguard the bank has taken insurance coverage for its entire ICT asset from a
reputed insurance company.

110 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

3.14 Compliance of Bangladesh Financial Reporting Standard (BFRS)

Name of the standards Ref. Status


First-time adoption of Bangladesh Financial Reporting Standards BFRS-1 Not applicable
Share based Payment BFRS-2 Not applicable
Business Combinations BFRS-3 Not applicable
Insurance Contracts BFRS-4 Not applicable
Non-current Assets Held for Sale and Discontinued Operations BFRS-5 Not applicable
Exploration for and Evaluation of Mineral Resources BFRS-6 Not applicable
Financial Instruments: Disclosures BFRS-7 Applied with some
departure (note 3.14.1)
Operating Segments BFRS-8 Not applicable
Presentation of Financial Statements BAS-1 Applied with some
departure (note 3.14.1)
Inventories BAS-2 Not Applicable
Statement of cash flows BAS-7 Applied
Accounting Policies, Changes in Accounting Estimates and Errors BAS-8 Applied
Events after the Reporting Period BAS-10 Applied
Construction Contracts BAS-11 Not Applicable
Income Taxes BAS-12 Applied
Property, Plant and Equipment BAS-16 Applied
Leases BAS-17 Applied
Revenue BAS-18 Applied
Employee Benefits BAS-19 Applied
Accounting for Government Grants and Disclosure of
Government Assistance BAS-20 Not Applicable
The Effects of Changes in Foreign Exchange Rates BAS-21 Applied
Borrowing Costs BAS-23 Applied
Related Party Disclosures BAS-24 Applied
Accounting and Reporting by Retirement Benefit Plans BAS-26 Not Applicable
Consolidated and Separate Financial Statements BAS-27 Applied
Investments in Associates BAS-28 Not Applicable
Interests in Joint Ventures BAS-31 Not Applicable
Financial Instruments: Presentation BAS-32 Applied with some
departure note 3.14.1
Earnings Per Share BAS-33 Applied
Interim Financial Reporting BAS-34 Applied
Impairments of Assets BAS-36 Applied
Provisions, Contingent Liabilities and Contingent Assets BAS-37 Applied
Intangible Assets BAS-38 Not Applicable
Financial Instruments: Recognition and Measurement BAS-39 Applied with some
departure see note 3.14.1
Investment property BAS-40 Not Applicable
Agriculture BAS-41 Not Applicable

Annual Report - 20 10 111


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
3.14.1 Disclosure of departures from few requirements of BFRSs due to mandatory compliance of Bangladesh
Banks requirements

Bangladesh Bank is the prime regulatory body for banks in Bangladesh. Some requirements of Bangladesh Banks
rules and regulations contradict with those of financial instruments and general provision standards of BFRSs. As
such the Bank has departed from those contradictory requirements of BFRSs in order to comply with the rules
and regulations of the Bangladesh Bank which are disclosed below along with financial impact where applicable:

1. As per BRPD circular no. 14 dated 25 June 2003 investments in quoted shares and unquoted shares are
revalued at the year end at market price and as per book value of last audited balance sheet respectively. Provi-
sion should be made for any loss arising from diminution in value of investment. As such the Bank measures
and recognizes investment in quoted and unquoted shares at cost if the year end market value (for quoted
shares) and book value (for unquoted shares) are higher than the cost. At the year-end the Banks market value
and book value of investments in quoted and unquoted shares was higher than cost price by Tk. 277 million.
However as per requirements of BAS 39 investment in shares falls either under at fair value through profit and
loss account or under available for sale where any change in the fair value at the year-end is taken to profit
and loss account or revaluation reserve respectively.

2. According to DOS circular no. 05 dated 26 May 2008 and subsequent clarification in DOS circular no. 05
dated 28 January 2009 loss on revaluation of Government securities (T-bill/T-bond) should be charged in
profit and loss account, and gain on such revaluation should be recorded under Revaluation Reserve Account.
At the year end the company has accumulated revaluation gain of Tk. 1,028.89 million for T-bonds. However
as per requirement of BAS 39, such T-bills and T-bonds will fall under the category of held for trading and
held to maturity where any change in the fair value of held for trading is recognized in profit and loss
account, and amortized cost method is applicable for held to maturity using an effective interest rate.

3. As per BRPD circular no. 5 dated 5 June 2006 a general provision at 1% to 5% under different categories of
unclassified loans (good/standard loans) has to be maintained. However such general provision cannot satisfy
the conditions of provision as per BAS 37. At the year end the Bank has recognized an accumulated general
provision of Tk. 972.2 million in the balance sheet under liabilities as per Bangladesh Banks requirement.

4. As per BRPD circular no. 10 dated 18 September 2007, a general provision at 1% is required to be provided
for all off-balance sheet exposures. However such general provision cannot satisfy the conditions of provision
as per BAS 37. At the year end the Bank has recognized an accumulated general provision of Tk. 554.28
million in the balance sheet under liabilities as per Bangladesh Banks requirement.

5. Bangladesh Bank has issued templates for financial statements which will strictly be followed by all banks. The
templates of financial statements issued by Bangladesh Bank do not include Other Comprehensive Income
nor are the elements of Other Comprehensive Income allowed to include in a Single Comprehensive Income
(OCI) Statement. As such the company does not prepare the other comprehensive income statement.
However elements of OCI, if any, are shown in the statements of changes in equity.

6. As per Bangladesh Bank guidelines financial instruments are categorized, recognized and measured differently
from those prescribed in BAS 39. As such some disclosure and presentation requirements of BFRS 7 and BAS
32 have not been made in the accounts.

112 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

3.15 Credit Rating of the Bank

As per the BRPD instruction circular No.6 dated 5 July 2006, the bank has done its credit rating by Credit Rating
Information and Services Limited (CRISL) based on the financial statements dated 31 December 2009

Particulars Date of Rating Long term Short term

Entity Rating 27-Apr-10 AA- ST-2


double A minus (High certainty)
(High Safety)

3.16 Correspondence items


Correspondence items are maintained to have control over all items of importance and for such transactions
where the Bank has only a business responsibility and no legal commitment. Stock of travelers cheques, savings
certificates, wage earners bond and others fall under the correspondence items.

3.17 Offsetting
Financial assets and liabilities are offset and the net amount presented in the balance sheet when, and only when,
the Group has a legal right to set off the recognised amounts and it intends either to settle on a net basis or to
realise the asset and settle the liability simultaneously.

Income and expenses are presented on a net basis only when permitted under BFRSs, or for gains and losses
arising from a group of similar transactions such as in the Groups trading activity.

3.18 General
"Figures of previous year have been rearranged, whenever necessary, to conform the current year's presentation."

4. Cash 2010 2009


Taka Taka
In hand:
Local currency 796,113,612 568,197,415
Foreign currencies 30,878,494 38,296,034
826,992,106 606,493,449
Balance with Bangladesh Bank:
Local currency 6,120,864,709 5,051,775,889
Foreign currencies 242,354,590 266,671,909
6,363,219,299 5,318,447,798
Balance with Sonali Bank Limited. (as agent of Bangladesh Bank):
Local currency 105,371,199 95,416,332
6,468,590,498 5,413,864,130
7,295,582,604 6,020,357,579

4.1 Cash Reserve Requirement (CRR) and Statutory Liquidity Requirement (SLR) have been calculated and main-
tained in accordance with section 33 of Bank Companies Act, 1991, MPD circular nos. 4 and 5 dated 1 Decem-
ber 2010.

The statutory Cash Reserve Requirement on the Bank's time and demand liabilities at the rate of 6% has been
calculated and maintained with Bangladesh Bank in current account and 19% Statutory Liquidity Requirement,
including CRR, on the same liabilities has also been maintained in the form of treasury bills, bonds and deben-
tures including FC balance with Bangladesh Bank. Both reserves maintained by the Bank, are shown below:

Annual Report - 20 10 113


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

4.1.1 a) Cash Reserve Requirement (CRR) for Conventional Banking 2010 2009
6% (2009: 5%) of average Demand and Time Liabilities: Taka Taka
Required reserve 5,774,410,000 4,096,239,550
Actual reserve held 6,326,690,991 5,051,775,889
Surplus 552,280,991 955,536,339
b) Cash Reserve Requirement (CRR) for Islamic Banking
6% of average Demand and Time Liabilities:
Required reserve 391,539,000 -
Actual reserve held 424,834,444 -
Surplus 33,295,444 -
4.1.2 a) Statutory Liquidity Requirement (SLR) for Conventional Banking
19% (2009: 18%) of required Average Demand and Time Liabilities:
Required reserve 18,285,632,000 14,746,462,380
Actual reserve held 23,384,829,469 25,427,964,183
Surplus 5,099,197,469 10,681,501,803
Held for Statutory Liquidity Requirement of Conventional Banking:
Cash in hand 766,897,941 606,493,450
Balance with Bangladesh Bank as per statement 6,326,690,991 5,381,447,798
Balance with agent bank (Sonali Bank Ltd.) as per statement 99,779,395 95,416,332
Government treasury bills 1,276,504,519 5,512,691,126
Government treasury bonds 14,914,956,623 13,894,915,477
23,384,829,469 25,427,964,183
b) Statutory Liquidity Requirement (SLR) for Islamic Banking
11.5 % of required average Demand and Time Liabilities:
Required reserve 750,450,000 -
Actual reserve held 890,520,413 -
Surplus 140,070,413 -
Held for Statutory Liquidity Ratio of Islamic Banking:
Cash in hand 60,094,165 -
Balance with Bangladesh Bank as per statement 424,834,444 -
Balance with agent bank (Sonali Bank Ltd.) as per statement 5,591,804 -
Government treasury bills - -
Government treasury bonds 400,000,000 -
890,520,413 -

In Bangladesh (Note 5.1) 1,972,298,388 387,767,997


Outside Bangladesh (Note 5.2) 1,058,808,731 734,577,920
3,031,107,119 1,122,345,917
5.1 In Bangladesh
Current account with:
Sonali Bank Limited 60,720,142 54,688,065
Agrani Bank Limited 1,426,229 15,275,576
AB Bank Limited 6,728,716 75,166
13,457 2,816,303
National Bank Limited 2,216,727 194,476
Janata Bank Limited 2,596,921 2,138,766
Pubali Bank Limited 8,048,037 8,352,609
Rupali Bank Limited 3,137,981 5,019,306
United Commercial Bank Limited 8,719,014 3,045,891
Bangladesh Krishi Bank 248 248
Al-Arafah Islami Bank Limited 2,795 3,945
1,407 (161,424)
Islami Bank Bangladesh Limited 1,017,963 (103,393)

114 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka

Bank Asia Limited (165,079) 3,943,421


Shahjalal Islami Bank Limited 550,000 552,673
One Bank Limited 98,545 99,382
Dutch-Bangla Bank Limited 3,255,964 1,338,522
Jamuna Bank Limited 25,321 2,009,725
Mercantile Bank Limited 89,008 5,504,072
Mutual Trust Bank Limited (2,925,121) -
Dhaka Bank Limited - 1,452
Brac Bank Limited 1,665,011 -
97,223,286 104,794,781
Short term deposits account with:
976,408 955,693
AB Bank Limited 28,003 29,273
Eastern Bank Limited 28,729 188,174
Uttara Bank Limited 3,555 13,047
EXIM Bank Limited 567,705 578,953
Sonali Bank Limited 20,118,522 20,362,428
Standard Chartered Bank 3,049,867 2,122,048
Dutch-Bangla Bank Limited 302,313 8,723,600
25,075,102 32,973,216
Fixed deposits with other banks:
AB Bank Limited 200,000,000 -
Dhaka Bank Limited 400,000,000 -
600,000,000 -

Bay Leasing and Investment Limited 300,000,000 100,000,000


Bangladesh Industrial Finance Company Limited 250,000,000 -
International Leasing and Financial Services Limited 500,000,000 100,000,000
Fareast Finance & Investment Limited - 50,000,000
Prime Finance & Investment Limited 200,000,000 -
1,250,000,000 250,000,000
1,972,298,388 387,767,997
5.2 Outside Bangladesh
Current account
Interest bearing :
Standard Chartered Bank, New York 75,380,904 11,245,447
Standard Chartered Bank, New York 175,941,057 -
Citibank, New York 18,980,057 79,517,685
HSBC, New York 24,993,908 137,079,316
HSBC, PLC London 69,872,782 55,522,881
Mashreq Bank PSC New York 246,905,610 208,962,332
Wells Fargo Bank, N.A., New York 112,710,060 38,297,211
Citibank AG Frankfurt Germany 11,002,585 25,433,403
Standard Chartered Bank, Kolkata 10,831,283 18,985,301
Arab Bangladesh Bank Ltd., Mumbai 34,449,169 25,372,899
ICICI Bank, Mumbai 43,476,635 44,378,668
JP Morgan Chase Bank, New York 15,707,367 1,974,058
Habib American Bank, New York 23,749,121 45,580,662
Mashreq Bank, Mumbai, India 23,630,032 -
Mashreq Bank, Mumbai, India 3,440,519 -
891,071,089 692,349,863

Annual Report - 20 10 115


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
Non-interest bearing :
Bank of Nova Scotia, Toronto, Canada 3,159,715 1,989,364
United Bank Limited, Karachi 55,474,785 6,166,397
Standard Chartered Bank, Colombo 10,446,227 1,146,974
Standard Chartered Bank, Mumbai (AEB) 23,154,511 1,764,223
Nepal Bangladesh Bank Ltd., Nepal 1,276,113 3,746,775
Bank of Bhutan, Pheuntsholing 1,081,374 354,265
Bank of Tokyo Mitsubishi, Kolkata 1,786,784 1,749,331
Commerz Bank AG 31,329,842 10,970,625
U. B. A. F., Tokyo 29,472,127 5,796,165
Zuercher Kantonal Bank, Zurich 5,671,874 6,252,988
National Australia Bank Ltd. Melbourne 4,884,290 2,290,950
167,737,642 42,228,057
1,058,808,731 734,577,920

5.3
On demand 1,156,032,017 104,794,781
Not more than three months 1,225,075,102 917,551,136
More than three months but not more than six months 650,000,000 -
More than six months but not more than one year - 100,000,000
- -
- -
3,031,107,119 1,122,345,917

In Bangladesh
Southeast Bank Limited (Note 5.1) 1,972,298,388 387,767,997
Southeast Bank Capital Services Limited 539,907,204 -
2,512,205,592 387,767,997
Less: Inter company balance eliminated 539,907,204 -
1,972,298,388 387,767,997

Outside Bangladesh
Southeast Bank Limited (Note 5.2) 1,058,808,731 734,577,920
Southeast Bank Capital Services Limited - -
1,058,808,731 734,577,920
3,031,107,119 1,122,345,917

6. Money at call and on short notice


In bank:
19,500,000 19,700,000
Bank Asia Limited 300,000,000 -
319,500,000 19,700,000

International Leasing and Financial Services Limited 80,000,000 -


Bangladesh Industrial Finance Company Limited 10,000,000 10,000,000
Prime Finance & Investment Limited 100,000,000 -
Premier Leasing International Limited - 50,000,000
Phonix Leasing Company Limited - 30,000,000
Bay Leasing and Investment Limited - 80,000,000
190,000,000 170,000,000
509,500,000 189,700,000

116 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
7. Investments Taka Taka
Government securities
Conventional Banking (Note 7.1.1) 16,203,461,142 19,407,606,604
Islamic Banking (Note 7.2.1) 400,000,000 -
16,603,461,142 19,407,606,604
Others
Conventional Banking (Note 7.1.2) 273,872,881 1,942,627,246
Islamic Banking (Note 7.2.2) 1,450,313,250 -
1,724,186,131 1,942,627,246
18,327,647,273 21,350,233,850
7.1 Conventional Banking

7.1.1 Government Securities


28 days Treasury Bills - -
91 days Treasury Bills 648,356,492 3,475,576,090
182 days Treasury Bills 1,033,294,412 906,129,651
364 days Treasury Bills 1,711,243,193 1,130,985,385
2 Years Treasury Bills - -
5 Years Treasury Bills - -
3,392,894,097 5,512,691,126
Add: Reverse repo with other banks - -
3,392,894,097 5,512,691,126
Less: Repo with other banks 2,116,389,578 -
1,276,504,519 5,512,691,126
Government Bonds
Prize Bonds 4,102,600 5,850,000
T & T Treasury Bond - 196,273,800
4,102,600 202,123,800

Bangladesh Government Treasury Bond 17,584,154,526 15,564,891,678


Less: Repo with other banks 2,661,300,503 1,872,100,000
14,922,854,023 13,692,791,678
16,203,461,142 19,407,606,604
7.1.2 Others
Shares in listed companies 18,172,881 1,825,647,346
Shares in un-listed companies 260,000,000 194,979,900
278,172,881 2,020,627,246
Less: Provision for diminution in the market value of shares 4,300,000 78,000,000
273,872,881 1,942,627,246
7.2 Islamic Banking

7.2.1 Government Securities


Bangladesh Government islamic bond 400,000,000 -
7.2.2 Others
Shares in listed companies 1,070,514,010 -
Shares in un-listed companies 407,999,240 -
1,478,513,250 -
Provision for diminution in the market value of shares (28,200,000) -
1,450,313,250 -

Held for trading (HFT) 11,508,624,726 16,344,376,400


Held to maturity (HTM) 5,090,733,815 2,861,049,165
Other securities 1,728,288,732 2,144,808,285
18,327,647,273 21,350,233,850

BGTB (HTM) of Tk 12,000,000 is held in Bangladesh Bank as Lien for T.T. discounting facilities.

Annual Report - 20 10 117


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
7.4 Maturity-wise grouping
On demand 4,102,600 1,942,627,246
Not more than three months 1,924,187,721 4,264,205,360
More than three months but not more than one year 1,476,504,305 1,580,461,138
3,232,007,202 5,479,460,143
11,690,845,445 8,083,479,963
18,327,647,273 21,350,233,850

7.5 Cost and market value of investments

7.5.1 Government securities

2010 2009
Cost price Market price Market price
Conventional Banking Taka Taka Taka
Treasury Bills 1,270,375,378 1,276,504,519 5,512,691,127
T & T Treasury Bond - - 196,273,800
Bangladesh Government Treasury Bond 14,327,299,874 14,922,854,023 13,692,791,677
Prize Bonds 4,102,600 4,102,600 5,850,000
15,601,777,852 16,203,461,142 19,407,606,604
Islamic Banking
Bangladesh Government islamic bond 400,000,000 400,000,000 -
16,001,777,852 16,603,461,142 19,407,606,604
7.5.2 Others
Conventional Banking
Investment in Shares & Bonds
Particulars
Shares in listed companies 13,956,402 18,172,881 1,825,647,346
Shares in un-listed companies 260,000,000 260,000,000 194,979,900
273,956,402 278,172,881 2,020,627,246
Provision for diminution in the market value of shares (4,300,000) (78,000,000)
273,872,881 1,942,627,246
Islamic Banking
Shares in listed companies 1,319,565,179 1,070,514,010 -
Shares in un-listed companies 407,999,240 407,999,240 -
1,727,564,419 1,478,513,250 -
Provision for diminution in the market value of shares (28,200,000) -
1,450,313,250 -
1,724,186,131 1,942,627,246
Shares in listed companies
Investments have been recorded at cost and adequate provision for probable future losses as per Bangladesh Bank
guidelines. Market value of shares has been determined on the basis of the value of shares at the last trading day
of the year.

Details are shown in Annexure-D

118 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Market price Cost price Cost price
Taka Taka Taka
7.6 Sector wise investment
Shares in Listed Companies
Banks and NBFIs 323,417,548 289,984,811 1,063,547,526
Insurance Companies 284,065,869 109,264,280 361,692,426
Fuel and Power Companies 111,801,300 121,239,936 -
Manufacturing & Others 614,236,805 568,197,864 400,407,394
1,333,521,522 1,088,686,891 1,825,647,346

Shares in Un-Listed Companies


Banks and NBFIs 20,000,000 20,000,000 46,814,000
Fuel and Power Companies 87,000,000 87,000,000 -
Manufacturing 200,000,000 200,000,000 100,000,000
Others 360,999,240 360,999,240 48,165,900
667,999,240 667,999,240 194,979,900
1,756,686,131 2,020,627,246
Provision for diminution in the market value of shares (32,500,000) (78,000,000)
1,724,186,131 1,942,627,246

statements as per provision of BRPD 14.

7.7 Market price of investments whose prices decreased as on 31 December 2010

2010 (Provision to
Name of the Company Market price Cost price be required)
Taka Taka Taka

Rupali Bank Limited 6,268,765 9,074,723 2,805,958


KPCL 6,756,000 8,394,665 1,638,665
Summit Power Ltd. 29,421,000 32,112,348 2,691,348
Titas Gas Trans & Dist. Co. Ltd. 75,624,300 80,732,923 5,108,623
Beximco Limited 15,575,000 16,269,238 694,238
Trust 1st MF 7,656,000 9,068,228 1,412,228
Lafarge Surma Cement Limited 272,460,375 290,381,578 17,921,203
413,761,440 446,033,703 32,272,263
Actual provision 32,500,000
227,737

7.8 Repo and Reverse-repo

7.8.1 Repo as on 31 December 2010


Counter party name Agreement date Reversal date Amount
Taka
Bangladesh Bank 30-Dec-10 2-Jan-11 4,557,606,272
Standard Chartered Bank 28-Dec-10 4-Jan-11 255,850,384
4,813,456,656

Annual Report - 20 10 119


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

7.8.2 Transactions of Repo and Reverse-repo during the year 2010

Minimum Maximum Daily average


outstanding outstanding outstanding
Taka Taka Taka
Securities sold under repo

i) With Bangladesh Bank 255,532,535 6,837,714,787 344,572,016


ii) With Other Bank & FIs 100,000,000 1,000,000,000 65,897,839

Securities purchase under reverse repo


i) With Bangladesh Bank - - -
ii) With Other Bank & FIs 76,803,439 1,499,831,011 25,591,216

2010 2009
7 (a) Consolidated Investments Taka Taka
Government securities
Southeast Bank Limited 16,603,461,142 19,407,606,604
Southeast Bank Capital Services Limited - -
16,603,461,142 19,407,606,604
Others
Southeast Bank Limited 1,724,186,131 1,942,627,246
Southeast Bank Capital Services Limited 541,423,964 -
2,265,610,095 1,942,627,246
18,869,071,237 21,350,233,850
8. Loans and advances/investments
Loans, cash credit, overdrafts etc./Investments (Note 8.1) 86,880,309,365 73,466,742,724
Bills purchased and discounted (Note 8.14) 5,572,306,128 4,030,830,475
92,452,615,493 77,497,573,199
8.1 Loans, cash credit, overdrafts etc./Investments
In Bangladesh
Conventional Banking
Cash credit and overdrafts 20,270,923,124 14,630,464,999
Demand loan 2,338,351,118 2,262,183,637
Time loan 8,246,310,483 11,598,808,511
Term loan 27,991,248,054 24,982,363,453
Consumer credit scheme 221,556,631 205,214,801
Bills against letter of credit (BLC) 951,307,409 521,343,375
Loan against trust receipt (LTR) 19,952,749,783 12,072,275,458
Export Development Fund (EDF) 957,178,193 241,475,856
Advances - Packing credit (PC) 1,114,041,396 928,519,025
144,831,912 146,869,198
Loan - Credit card 427,787,662 321,261,434
Education - Loans 137,349 178,364
27,015,776 21,803,098
Portfolio Margin Loan - 1,969,179,889
Loan against foreign bills 77,029,201 6,748,245
Loan against Cash Incentive 17,782,749 -
82,738,250,840 69,908,689,343

120 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
Islamic Banking
Bai-Muajjal - Investment 1,883,633,679 1,315,720,799
Murabaha - Investment 228,762,465 205,547,196
Hire purchase - Investment 1,510,030,936 1,012,574,568
Izarah - Investment 119,461,850 122,514,748
Quard against MTDR 400,169,595 901,696,070
4,142,058,525 3,558,053,381
86,880,309,365 73,466,742,724
Outside Bangladesh - -
86,880,309,365 73,466,742,724
8.2 Performing loans and advances/Investments

Gross loans and advances/investments 92,452,615,493 77,497,573,199


Non-performing loans and advances/investments (3,938,492,848) (2,892,999,553)
88,514,122,645 74,604,573,646
8.3 Maturity-wise grouping
On demand 3,341,467,493 4,231,362,199
Less than three months 29,109,474,000 23,573,383,000
More than three months but less than one year 31,522,946,000 24,973,906,000
18,857,218,000 15,634,707,000
9,621,510,000 9,084,215,000
92,452,615,493 77,497,573,199
8.4 Concentration of loans and advances
Advances to allied concerns of directors - 24,578,165
Advances to chief executive and other senior executives 29,500,548 47,912,000
Advances to customers' group:
Advances to large and medium industries 41,672,900,000 32,061,100,000
Advances to small and cottage industries 115,300,000 113,100,000
Commercial Lending 34,428,800,000 30,846,100,000
Export Financing 4,369,600,000 2,684,900,000
House Building Loan 4,804,300,000 3,518,000,000
Consumer Credit Scheme 221,556,000 221,300,000
Other Loans and Advances 6,810,658,945 7,980,583,034
Details of large loan/investments 92,452,615,493 77,497,573,199
As at 31 December 2010 there were eighteen (2009: thirty two) clients with whom amount of outstanding loans
and advances exceeded 10% of the total capital of the Bank. Total capital of the Bank was Tk 17,095.9 million
as at 31 December 2010 (Tk 9,927.16 million in 2009).
Details are shown in Annexure-E.
8.5 Sector-wise allocation of loans and advances 2010 2009
% of Taka % of Taka
total total
0.22% 199,000,000 0.35% 273,500,000
Industry (jute, textiles, garments, chemicals,
cements, etc.) 22.17% 20,500,900,000 23.79% 18,437,400,000
22.90% 21,172,000,000 17.58% 13,623,700,000
Export credit 4.73% 4,369,600,000 3.46% 2,684,900,000
Commercial credit 37.24% 34,428,800,000 39.80% 30,846,100,000
Small and cottage industries 0.12% 115,300,000 0.15% 113,100,000
Miscellaneous 12.62% 11,667,015,493 14.86% 11,518,873,199
100.00% 92,452,615,493 100.00% 77,497,573,199

Annual Report - 20 10 121


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
8.6 Industry-wise Loans and Advances (Industrial Loan)
Textile and Garments Industries including Spinning Industries 23,208,000,000 19,008,100,000
Food and allied Industries 3,871,800,000 2,067,900,000
Pharmaceutical Industries 351,500,000 339,900,000
Chemical, Fertilizer, etc. 815,800,000 882,100,000
Cement and Ceramic Industries 1,294,900,000 1,089,300,000
Service Industries 1,960,100,000 1,733,500,000
Other Industries 10,170,800,000 7,053,400,000
41,672,900,000 32,174,200,000
8.7 Category-wise Small Medium Enterprise Loans and Advances (SME)
Service Sector 1,264,132,000 705,051,000
Trading Sector 8,639,298,000 5,638,949,000
Industrial Sector 3,157,246,000 2,540,302,000
13,060,676,000 8,884,302,000
8.8 Geographical location-wise allocations of loans and advances
2010 2009
% of Taka % of Taka
total loan total loan
Urban:
Dhaka region 66.37% 61,363,563,852 69.88% 54,153,529,067
Chittagong region 25.33% 23,417,343,706 21.95% 17,006,897,479
Rajshahi region 1.17% 1,082,447,266 0.76% 590,200,731
Sylhet region 2.89% 2,668,533,833 4.75% 3,679,419,232
Khulna region 1.02% 940,668,597 0.54% 416,172,615
Barishal region 0.05% 47,954,638 0.00% 27,078
96.83% 89,520,511,892 97.87% 75,846,246,202
Rural:
Dhaka region 2.07% 1,911,857,770 1.25% 966,101,800
Chittagong region 0.88% 810,654,144 0.65% 505,971,831
Sylhet region 0.22% 205,152,098 0.23% 179,253,366
Khulna region 0.00% 4,439,589 0.00% -
3.17% 2,932,103,601 2.13% 1,651,326,997
100.00% 92,452,615,493 100.00% 77,497,573,199

94.19% 87,079,031,934 94.76% 73,433,338,556


Special Mention Account (SMA) 1.55% 1,435,090,711 1.51% 1,171,235,090
95.74% 88,514,122,645 96.27% 74,604,573,646

Sub-standard 0.88% 811,798,731 0.97% 751,554,367


Doubtful 1.76% 1,625,919,229 0.33% 251,995,691
Bad/loss 1.62% 1,500,774,888 2.44% 1,889,449,495
4.26% 3,938,492,848 3.73% 2,892,999,553
100.00% 92,452,615,493 100.00% 77,497,573,199

122 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

8.10 Particulars of loans and advances


2010 2009
Taka Taka
i) Debts considered good in respect of which the bank is
fully secured; 61,037,472,644 54,135,566,398
ii) Debts considered good for which the bank holds no
other security than the debtors' personal security; 11,006,727,866 4,938,802,676
iii) Debts considered good secured by the personal
liabilities of one or more parties in addition to the
personal security of the debtors; 18,907,640,097 16,533,754,630
iv) Debts adversely classified; provision not maintained - -
v) Debts due by directors or officers of the bank or any of
them either severally or jointly with any other persons; 144,831,912 163,485,824
vi) Debts due by companies or firms in which the directors or
officers of the bank are interested as directors, partners or
managing agents or, in case of private companies, as
members; - 24,578,165
vii) Maximum total amount of advances, including temporary
advances made any time during the year to directors
or managers or officers of the bank or any of them
either severally or jointly with any other persons; 149,745,313 167,486,599
viii) Maximum total amount of advances, including temporary
advances granted during the year to companies or
firms in which the directors of the bank are interested
as directors, partners or managing agents or, in case of
private companies, as members; - 29,774,798
ix) Due from banking companies; - -
x) Classified loans/investments for which interest has not been charged:

(a) Increase/decrease of provision (specific) 732,003,918 36,406,875


Amount of debts written off 851,950,000 981,644,225
Amount realised against the debts previously written off 25,734,000 117,107
(b) Provision against the debt classified as
bad/loss at the date of balance sheet 855,860,350 950,048,230

(c) Amount of interest charged in suspense account 666,489,856 477,029,930

xi) Loans written off:


- Current year 851,950,000 981,644,225
Cumulative to-date 2,462,301,328 1,610,351,328

- The amount of written off loans


for which lawsuit filed 2,462,301,328 1,610,351,328

Annual Report - 20 10 123


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
8.11 Particulars of required provision for loans and advances/investments

2010 2009
Outstanding Base for % of required Required Required
as at 31 Dec 2010 provision provision provision provision
Status Taka Taka Taka Taka
For loans and advances/Investments:
Unclassified - General provision
All unclassified loans (other
than small enterprises,
housing finance, loan to MBs
loans for professional, consumer
financing and special
mention account) 74,691,508,555 74,691,508,555 1% 746,915,086 632,504,773

Small and medium


enterprise financing 10,722,214,056 10,722,214,056 1% 107,222,141 85,407,564

Loan to BHs/MBs/SDs
against shares 550,671,799 550,671,799 2% 11,013,436 -

Housing and loan for


professional 343,709,803 343,709,803 2% 6,874,196 14,792,961

Consumer finance 626,095,804 626,095,804 5% 31,304,790 37,780,243

Special Mention
Account (SMA) 1,435,090,711 1,376,915,725 5% 68,845,786 56,811,270
972,175,435 827,296,811

Classified - Specific provision:


Sub-standard 811,798,731 404,670,462 20% 80,934,092 91,340,370
Doubtful 1,625,919,229 1,283,883,064 50% 641,941,532 79,328,825
Bad/loss 1,500,774,888 855,860,350 100% 855,860,350 950,048,230
1,578,735,974 1,120,717,425

Required provision for loans and advances 2,550,911,409 1,948,014,236

Total provision maintained 2,834,946,840 1,958,742,922

Excess/(short) provision at 31 December 284,035,431 10,728,686

124 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
8.12 Suits filed by the Bank (Branch-wise details) Taka Taka

Principal Branch 1,550,584,935 1,546,703,000


Agrabad Branch 40,504,207 292,898,000
Khatungonj Branch 3,863,000 3,863,000
Laldighirpar Branch 42,972,000 1,447,000
Imamgonj Branch 34,837,000 16,328,000
Bangshal Branch 469,037,000 217,008,000
Jubilee Road Branch 42,620,000 38,103,000
Moulvibazar Branch 13,070,000 13,069,000
Gulshan Branch 675,693,858 413,109,000
Khulna Branch 67,868,000 23,459,000
Dhanmondi Branch 753,010,000 157,541,000
Uttara Branch 122,692,000 9,090,000
Chouhatta Branch 2,911,000 3,007,000
Kawranbazar Branch 3,674,000 3,237,000
Shahjalal Uposhahar Branch 1,943,000 1,943,000
Agargoan Branch 11,242,000 4,632,000
Kulaura Branch 9,078,000 4,992,000
Hetimgonj Branch 1,800,000 14,309,000
Corporate Branch 5,437,000 5,437,000
Banani Branch 135,622,000 -
Rangpur Branch 32,054,000 -
Kakrail Branch 890,000 -
4,021,403,000 2,770,175,000
8.13 Listing of assets pledged as security/collaterals

Nature of the secured assets


Collateral of Land and Building 51,491,318,009 41,790,346,075
Share Certificate 4,145,673,173 5,260,979,477
Local Banks and Financial Institutions Guarantee 1,744,726,509 514,626,405
Government Guarantee - -
Foreign Banks Guarantee - 33,216,000
Export Document 7,425,337,940 3,922,875,394
Fixed deposit receipts ( FDR/DBS) 5,509,513,542 4,563,707,446
FDR of other Banks 108,130,902 92,813,540
Government Bonds 17,754,595 103,357
Personal guarantee 6,213,086,308 6,964,794,550
Others Security 15,797,074,515 14,354,110,955
92,452,615,493 77,497,573,199
8.14 Bills purchased and discounted

Bills purchased and discounted excluding treasury bills:

In Bangladesh 4,211,295,366 3,177,031,647


Outside Bangladesh 1,361,010,762 853,798,828
5,572,306,128 4,030,830,475

Annual Report - 20 10 125


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

2010 2009
Taka Taka
8.15 Maturity grouping of bills purchased and discounted

Within one month 1,536,067,000 1,879,353,475


More than one month but less than three months 2,235,084,000 1,591,373,000
More than three months but less than six months 975,856,000 545,400,000
More than six months 825,299,128 14,704,000
5,572,306,128 4,030,830,475
8 (a) Consolidated Loans and advances/investments
Loans, cash credit, overdrafts etc./investments
Southeast Bank Limited 86,880,309,365 73,466,742,724
Southeast Bank Capital Services Limited 1,721,557,083 -
88,601,866,448 73,466,742,724
Less: Inter company balance eliminated 192,970,253 -
88,408,896,195 73,466,742,724
Bills purchased and discounted
Southeast Bank Limited 5,572,306,128 4,030,830,475
Southeast Bank Capital Services Limited - -
5,572,306,128 4,030,830,475
93,981,202,323 77,497,573,199

9 Fixed assets including premises, furniture and fixtures


Cost:
Land 2,785,035,544 2,784,940,544
Building 1,065,320,239 1,065,280,239
Furniture and fixture 542,878,114 455,218,069
Office Appliances 6,805,625 4,269,062
Electrical Appliances 484,663,516 321,192,258
Motor vehicles 43,802,452 25,630,216
4,928,505,490 4,656,530,388
Less: Accumulated depreciation
Building 113,364,380 75,426,046
Furniture and fixture 151,489,506 111,807,921
Office Appliances 2,306,768 1,796,456
Electrical Appliances 181,928,754 130,189,368
Motor vehicles 16,334,072 13,720,062
465,423,480 332,939,853
Written down value at the end of the year 4,463,082,010 4,323,590,535
Details are shown in Annexure-F

9(a) Consolidated fixed assets including premises, furniture and fixtures


Cost:
Southeast Bank Limited 4,928,505,490 4,656,530,388
Southeast Bank Capital Services Limited 696,229 -
4,929,201,719 4,656,530,388
Less: Accumulated depreciation
Southeast Bank Limited 465,423,480 332,939,853
Southeast Bank Capital Services Limited 139,246 -
465,562,726 332,939,853
Written down value at the end of the year 4,463,638,993 4,323,590,535

Details of consolidated amounts have not been provided as such amounts are insignificantly different from those
of the Banks.

126 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
10. Other assets 5,862,577,526 2,173,183,844

10.1 Classification of other assets

a) Income generating other assets - -


b) Non-income generating other assets:
i) Investment in shares of subsidiary companies:
- In Bangladesh 899,970,000 -
- Outside Bangladesh - -
ii) Stationery, stamps, printing materials, etc. 73,322,732 53,582,292
iii) Advance rent and advertisement 85,618,942 69,562,259
iv) Interest accrued on investment but not collected,
commission and brokerage receivable on shares and
debentures, and other income receivables 444,918,955 371,942,505
v) Security deposits 1,339,982 1,311,392
vi) Preliminary, formation and organisational expenses,
renovation, development and prepaid expenses 2,006,092,522 480,779,931
vii) Branch adjustment (Note 10.2) 911,161,905 -
viii) Suspense account 3,424,352 10,147,485
ix) Silver - -
x) Others (Note 10.3) 1,438,092,261 1,185,857,980
5,863,941,651 2,173,183,844
10.2 Branch adjustment

General accounts debit 4,250,855,905 -


General accounts credit 3,339,694,000 -
911,161,905 -

Branch adjustments account represents outstanding interbranch and head office transactions (net) originated but
yet to be responded at balance sheet date. However, the unrespondent entries of 31 December 2010 are given
below:
No. of unrespondent entries Unrespondent entries (Taka)
Debit Credit Debit Credit
Upto 3 months 1,086 889 3,559,076,905 2,678,688,000
Over 3 months but within 6 months 57 71 685,251,000 657,422,000
Over 6 months but within 1 year 72 44 2,897,000 1,422,000
Over 1 year but within 5 years 138 153 3,631,000 2,162,000
1,353 1,157 4,250,855,905 3,339,694,000

2010 2009
10.3 Others Taka Taka

Accounts receivable - others 1,435,930,424 666,520,127


Advance paid for preference share - 510,353,500
ATM teller account - 8,147,600
DD paid without advice 2,161,837 836,753
1,438,092,261 1,185,857,980

Annual Report - 20 10 127


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

10.4 Particulars of required provision for other assets


2010 2009
Base for provision Rate (%) Taka Taka
Legal Expenses for Defaulting Borrowings 19,923,400 50% 9,961,700 5,948,617
Legal Expenses for Defaulting Borrowings 7,444,374 100% 7,444,374 8,916,450
Protested bills - - - 1,778,900
Nostro Account Balance 1,769,807 100% 1,769,807 1,769,807
Required Provision on Other Assets 19,175,881 18,413,774
Total Provision maintained 19,635,281 18,414,181
Excess / (Short) Provision 459,400 407

2010 2009
10 (a) Consolidated other assets Taka Taka

Southeast Bank Limited 5,863,941,651 2,173,183,844


Southeast Bank Capital Services Limited 102,416,433 -
5,966,358,086 2,173,183,844
Less: Investment in subsidiary 899,970,000 -
Inter company balance eliminated 1,432,219,836 -
2,332,189,836 -
3,634,168,248 2,173,183,844

In Bangladesh (Note 11.1) 976,452,941 261,836,236


Outside Bangladesh - -
976,452,941 261,836,236
11.1 In Bangladesh
Secured:
447,000 448,000
106,707,312 261,388,236
189,298,629 -
Borrowing against securities from Bangladesh Bank 600,000,000 -
Call borrowing from Other Banks 80,000,000 -
976,452,941 261,836,236
Un secured - -
976,452,941 261,836,236

11.2 Maturity grouping of borrowings


Repayable on demand 80,000,000 -
Repayable within one month 200,000,000 -
Over one month but within six months 400,000,000 -
Over six months but within one year - -
Over one year 296,452,941 261,836,236
976,452,941 261,836,236

Southeast Bank Limited 976,452,941 261,836,236


Southeast Bank Capital Services Limited 192,970,253 -
1,169,423,194 261,836,236
Less: Inter company balance eliminated 192,970,253 -
976,452,941 261,836,236

128 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
12. Deposits and other accounts
Current/Al-wadeeah current accounts and other accounts
Current / Al-wadeeah current deposits 5,060,678,437 2,857,053,475
Foreign currency deposits 558,110,099 368,335,289
Sundry deposits (Note 12.1) 4,430,177,461 3,000,866,377
10,048,965,997 6,226,255,141
Bills payable
Payment order issued 1,230,191,392 1,094,777,697
Demand draft 116,015,990 68,362,450
1,346,207,382 1,163,140,147
Savings bank/Mudaraba savings bank deposits 5,773,710,807 6,694,031,711
Fixed deposits/Mudaraba fixed deposits
Fixed deposits / Mudaraba fixed deposits 77,934,184,382 70,969,472,459
Short notice / Mudaraba short notice deposits 7,877,810,445 6,573,407,109
Scheme deposits 2,845,825,965 2,378,766,263
Interest Payable on FDR/Scheme 1,902,882,795 2,663,979,309
90,560,703,587 82,585,625,140
107,729,587,773 96,669,052,139
12.1 Sundry deposits

Margin under letter of credit 1,522,363,055 2,256,298,601


Margin against IBP 3,927,002 15,976,555
Margin under letter of guarantee 432,928,654 466,536,387
Margin under Export Procceds 1,433,841,093 6,858,296
Deposit held against FDBP/ IDBP, export bills etc 65,566,109 14,051,749
Accounts Payable 1,497,709 21,838,847
Telegraphic Transfer 13,110,442 9,763,670
Mail Transfer - 10,000
Remittance awaiting disposal 36,613,989 35,171,592
Others 920,329,408 174,360,680
4,430,177,461 3,000,866,377
12.2 Deposits from banks and others

Inter-bank deposits (Note 12.3) 4,087,053,000 7,805,232,000


Other deposits 103,642,534,773 88,863,820,139
107,729,587,773 96,669,052,139
12.3 Inter-bank deposits

Basic Bank Limited - 400,000,000


Exim Bank Limited 3,640,000 3,400,000
IFIC Bank Limited 100,225,000 300,223,000
The City Bank Limited - 2,480,000,000
Mercantile Bank Limited 1,905,000 2,639,000
AB Bank Limited 200,070,000 50,000,000
Social Islami Bank Limited 10,672,000 556,500,000
Brac Bank Limited 902,000 400,078,000
Janata Bank Limited 130,000,000 150,000,000
Shahjalal Islami Bank Limited 373,066,000 512,200,000
Al-Arafa Islami Bank Limited 2,605,347,000 809,700,000
Islami Bank Bangladesh Limited 185,000 1,007,800,000
Bangladesh Krishi Bank 257,525,000 600,000,000
First Security Islami Bank Limited 3,510,000 96,300,000
Dutch Bangla Bank Limited 6,000 300,000,000
Premier Bank Limited 400,000,000 -
Grameen Bank - 80,000,000
Bangladesh Bank Refinance - 34,400,000
Accrued Interest - 21,992,000
4,087,053,000 7,805,232,000

Annual Report - 20 10 129


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
12.4 Sector-wise deposits
Government 6,725,732,000 8,403,447,000
Deposit money banks 4,087,053,000 7,805,232,000
Other public 6,995,924,000 7,751,335,000
Foreign currency 558,110,099 368,335,289
Private 89,362,768,674 72,340,702,850
107,729,587,773 96,669,052,139
12.5 Unclaimed Deposits and valuables
Payment Order 10,666 12,240
10,666 12,240
12.6 Analysis of residual maturity grouping of deposits
Inter-bank deposits:
Payable on demand - -
Within one month 1,099,528,000 3,657,891,667
More than one month but less than six months 2,530,000,000 4,147,340,333
More than six months but less than one year 457,525,000 -
More than one year but less than five years - -
More than five years but less than ten years - -
4,087,053,000 7,805,232,000
Other Deposits:
Payable on demand 1,913,812,073 2,777,072,000
Within one month 15,397,140,700 13,994,108,333
More than one month but less than six months 39,639,280,000 30,883,912,667
More than six months but less than one year 21,777,814,000 26,226,814,000
More than one year but less than five years 19,613,369,000 10,962,482,139
More than five years but less than ten years 5,301,119,000 4,019,431,000
103,642,534,773 88,863,820,139
107,729,587,773 96,669,052,139
12(a) Consolidated deposits and other accounts

Current/Al-wadeeah current accounts and other accounts


Southeast Bank Limited 10,048,965,997 6,226,255,141
Southeast Bank Capital Services Limited 63,509,749 -
10,112,475,746 6,226,255,141
Less: Inter company balance eliminated 39,907,204 -
10,072,568,542 6,226,255,141
Bills payable
Southeast Bank Limited 1,346,207,382 1,163,140,147
Southeast Bank Capital Services Limited - -
1,346,207,382 1,163,140,147
Savings bank/Mudaraba savings bank deposits
Southeast Bank Limited 5,773,710,807 6,694,031,711
Southeast Bank Capital Services Limited - -
5,773,710,807 6,694,031,711
Fixed deposits/Mudaraba fixed deposits
Southeast Bank Limited 90,560,703,587 82,585,625,140
Southeast Bank Capital Services Limited -
90,560,703,587 82,585,625,140
Less: Inter company balance eliminated 500,000,000
90,060,703,587 82,585,625,140
107,253,190,318 96,669,052,139

130 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
13. Other liabilities Taka Taka

Provision for loans and advances/investments (Note 13.1) 2,834,946,840 1,958,742,922


Provision for off-balance sheet exposures (Note 13.2) 554,280,000 351,330,000
Interest suspense account (Note 13.3) 666,489,856 477,029,930
Provision for taxation (Note 13.4) 1,375,765,583 973,693,953
SEBL Foundation 50,000,000 30,000,000
SEBL Employees welfare fund 35,000,000 -
Obligation under finance lease (Note 13.5) 28,102,542 24,684,153
Accrued expenses 10,377,120 8,428,052
Interest payable on borrowings 4,939,465 4,023,909
Accounts payable - Bangladesh Bank (local currency) 6,623,432 2,033,839
Accounts payable - Others 138,790,368 229,468,621
Provision for bonus 287,501 287,501
Provision for other assets (Note 13.6) 17,635,281 18,414,181
Unearned income 72,682,558 -
Branch Adjustment (net & reconciled) (Note 13.7) - 119,514,234
Withholding tax on interest on deposits 295,734,279 218,767,967
Provision for audit fees 500,000 500,000
6,092,154,825 4,416,919,262
13.1 Provision for loans and advances/investments

A. General
Balance at the beginning of the year 828,000,000 641,315,000
Add: Provision made during the year
On general loans and advances/investments etc. 132,165,000 189,765,000
On Special Mention Account (SMA) 12,035,000 -
144,200,000 189,765,000
Less: Provision no longer required - 3,080,000
Balance at the end of the year 972,200,000 828,000,000
B. Specific
Balance at the beginning of the year 1,130,742,922 1,094,336,048
Less: Interest waiver during the year 8,117,000 19,935
Write off during the year 759,879,082 887,073,191
767,996,082 887,093,126
Add: Recoveries of amounts previously written off - -
Specific provision made during the year for other accounts 1,500,000,000 923,500,000
1,500,000,000 923,500,000
Balance at the end of the year 1,862,746,840 1,130,742,922
C. Total provision on loans and advances/investments (A+B) 2,834,946,840 1,958,742,922

13.2 Provision for off-balance sheet exposures

Balance as at 1 January 351,330,000 313,030,000


Add: Provision made during the year 202,950,000 38,300,000
554,280,000 351,330,000
Less: Adjustments made during the year - -
Balance as at 31 December 554,280,000 351,330,000

Annual Report - 20 10 131


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
13.3 Interest suspense account Taka Taka

Balance as at 1 January 477,029,930 333,945,475


Add:Amount transferred to "interest suspense" account during the year 938,096,262 804,799,483
1,415,126,192 1,138,744,958
Less: Amount of interest suspense recovered 635,272,178 557,673,995
Amount written off during the year 90,618,158 94,571,033
Interest waiver during the year 22,746,000 9,470,000
748,636,336 661,715,028
Balance as at 31 December 666,489,856 477,029,930

13.4 Provision for taxation

Current tax ( Note 13.4.1) 1,222,514,581 947,387,874


Deferred tax ( Note 13.4.2) 153,251,002 26,306,079
1,375,765,583 973,693,953
13.4.1 Provision for current tax

Advance tax
Balance as at 1 January 1,928,792,756 1,740,422,086
Add: Paid during the year 1,870,473,293 1,405,698,677
3,799,266,049 3,146,120,763
Less: Adjustments made during the year - 1,217,328,007
Balance as at 31 December 3,799,266,049 1,928,792,756

Provision
Balance as at 1 January 2,876,180,630 2,511,929,106
Add: Provision made during the year 2,145,600,000 1,581,579,531
5,021,780,630 4,093,508,637
Less: Adjustments made during the year - 1,217,328,007
Balance as at 31 December 5,021,780,630 2,876,180,630
Net balance as at 31 December 1,222,514,581 947,387,874

Corporate tax position of the bank has been shown in Annexure-G.

Provision for current tax of Tk.2,145,600,000 has been made @ 42.5% as prescribed by Finance Act 2010 of the
accounting profit made by the Bank after considering some of the add backs to income and disallowances of
expenditure as per Income Tax Ordinance and Rules 1984 and incompliance of para 46 of BAS 12 "Income Tax".

13.4.2 Provision for deferred tax

Balance as at 1 January 26,306,079 52,631,094


Add : Provision made for deferred tax liabilities
Charged/(credited) to profit and loss account 14,500,000 (26,325,015)
Charged/(credited) to revaluation reserve 112,444,923 -
126,944,923 (26,325,015)
153,251,002 26,306,079
Less: Provision made for deferred tax assets - -
Balance as at 31 December 153,251,002 26,306,079

132 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka

- 8,143,658
Electrical appliances - 3,941,214
Motor vehicles 28,102,542 12,599,281
28,102,542 24,684,153

Balance as at 1 January 24,684,153 53,806,222


Add: Addition during the year 19,610,379 9,998,338
44,294,532 63,804,560
Less: Adjustment during the year 16,191,990 39,120,407
Balance as at 31 December 28,102,542 24,684,153

2010 2009
Financial
Particulars Minimum charge for Minimum Financial
lease future Principal lease charge for Principal
payment period outstanding payment future period outstanding
Taka Taka Taka Taka Taka Taka
Payable within 1 year 9,637,150 3,502,735 6,134,415 17,685,980 1,896,206 15,789,774
Payable more than 1 year
but less than 2 years 8,304,245 2,724,467 5,579,778 4,202,840 1,017,123 3,185,717
Payable more than 2 years
but less than 5 years 19,916,130 3,527,781 16,388,349 6,736,580 1,027,918 5,708,662
37,857,525 9,754,983 28,102,542 28,625,400 3,941,247 24,684,153

2010 2009
13.6 Provision for Other Assets Taka Taka

Balance as at 1 January 18,414,181 24,005,181


Add: Addition during the year 1,000,000 14,409,000
19,414,181 38,414,181
Less: Adjustment during the year 1,778,900 20,000,000
Balance as at 31 December 17,635,281 18,414,181

13.7 Branch Adjustment (net & reconciled)

General Accounts Debit - (26,925,449,388)


General Accounts Credit - 27,044,963,622
- 119,514,234
13(a) Consolidated other liabilities

Southeast Bank Limited 6,092,154,825 4,416,919,262


Southeast Bank Capital Services Limited 1,648,585,107 -
7,740,739,932 4,416,919,262
Less: Inter company balance eliminated 1,432,219,836 -
6,308,520,096 4,416,919,262

Annual Report - 20 10 133


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
14. Share capital Taka Taka

14.1 Authorised:

100,000,000 ordinary shares of Tk 100 each 10,000,000,000 10,000,000,000

14.2 Issued, subscribed and paid up:


37,816,497 ordinary shares of Tk 100 each issued for cash 3,781,649,700 1,471,369,600

31,491,907 ordinary shares of Tk 100 each issued as bonus shares 3,149,190,700 1,951,267,700
69,308,404 6,930,840,400 3,422,637,300

14.3 Share capital at a glance from inception


Number of Capital
Year Particulars shares amount Cumulative
Taka Taka
1995 Opening / Sponsors Capital 1,000,000 100,000,000 100,000,000
1996 - - 100,000,000
1997 25% Stock Dividend 250,000 25,000,000 125,000,000
1998 20% Stock Dividend 250,000 25,000,000 150,000,000
1999 Initial Public Offer (IPO) 1,500,000 150,000,000 300,000,000
2000 10% Stock Dividend 300,000 30,000,000 330,000,000
2001 10% Stock Dividend 330,000 33,000,000 363,000,000
2002 10% Stock Dividend 363,000 36,300,000 399,300,000
2003 Right Issue @ 1:2 1,650,000 165,000,000 564,300,000
20% Stock Dividend 1,128,600 112,860,000 677,160,000
2004 30% Stock Dividend 2,031,480 203,148,000 880,308,000
2005 20% Stock Dividend 1,760,616 176,061,600 1,056,369,600
2006 Right Issue @1:1 10,563,696 1,056,369,600 2,112,739,200
8% Stock Dividend 1,690,191 169,019,100 2,281,758,300
2007 25% Stock Dividend 5,704,395 570,439,500 2,852,197,800
2008 20% Stock Dividend 5,704,395 570,439,500 3,422,637,300
2009 35% Stock Dividend 11,979,230 1,197,923,000 4,620,560,300
2010 Right Issue @1:2 23,102,801 2,310,280,100 6,930,840,400

14.4 Classification of shareholders by holding: Number of holders % of total holding


2010 2009 2010 2009
Less than 500 shares 57,796 19,302 9.84 6.59
500 to 5,000 shares 8,343 2,425 13.56 9.70
5,001 to 10,000 shares 305 154 3.21 3.07
10,001 to 20,000 shares 190 85 3.99 3.57
20,001 to 30,000 shares 72 32 2.59 2.32
30,001 to 40,000 shares 31 16 1.55 1.67
40,001 to 50,000 shares 21 25 1.39 3.39
50,001 to 100,000 shares 46 47 4.69 9.58
100,001 to 1,000,000 shares 86 65 36.14 52.43
Over 1,000,000 shares 8 1 23.04 7.68
66,898 22,152 100.00 100.00

134 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
14.5 Initial public offer (IPO)
Out of the total issued, subscribed and fully paid up capital of the bank 1,500,000 ordinary shares of Tk 100 each
amounting to Tk 150,000,000 was raised through public offering on shares in 1999.
14.6 Name of the Directors and their shareholdings as at 31 December 2010

Sl Name of the directors Status Opening Closing


position position
1 Mr. Alamgir Kabir, FCA Chairman 385,280 859,613
2 Mr. Ragib Ali Vice Chairman 963,657 1,951,404
3 Mr. M. A. Kashem Director 594,906 1,964,751
4 Mr. Azim Uddin Ahmed Director 936,522 1,896,456
5 Mr. Tahnoun A. Harun Director 50,544 102,351
(Representing Bangla Capital Limited)
6 Mrs. Jusna Ara Kashem Director 339,402 458,192
7 Mrs. Duluma Ahmed Director 702,001 1,421,551
8 Mr. Syed Shahid Ali Director 142,745 192,705
9 Mrs. Rehana Rahman Director 434,985 880,843
10 Mr. Md. Akikur Rahman Director 315,393 638,669
11 Mr. Monjur Miah Director - 329,313
12 Mrs. Sirat Monira Director 4,500 9,112
13 Mr. Abdul Hye Director 6,063 12,277
(Representing Karnafuli Tea Co. Limited
14 Dr. Zaidi Sattar Independent Director - -
15 Mr. A. H. M. Moazzem Hossain Depositor Director - -
4,875,998 10,717,237
14.7 Capital adequacy ratio (CAR)
The calculation of CAR has been done as per BRPD Circular no. 10 dated 10 March 2010 and the Basel-II guide-
line December 2010 vide BRPD Circular no. 35 dated 29 December 2010.
2010 2009
Core capital (Tier-I) Taka Taka
Paid up capital 6,930,840,400 3,422,637,300
Share premium 1,386,168,060 -
Statutory reserve (Note 15) 3,650,252,294 2,665,605,000
General reserve 247,650,000 247,650,000
Retained earnings (Note 18) 1,778,642,087 1,278,871,867
13,993,552,841 7,614,764,167
Supplementary capital (Tier-II)
General provision maintained against unclassified loan/investments 972,200,000 828,000,000
General provision on off-balance sheet items 554,280,000 351,330,000
Exchange equalization reserve - 4,204,046
Asset revaluation reserve 1,064,467,110 1,117,640,994
Revaluation reserve of Government securities 511,396,776 11,221,344
3,102,343,886 2,312,396,384
Additional Supplementary capital (Tier-III) - -
A) Total capital 17,095,896,727 9,927,160,551
B) Risk weighted assets (RWA)
Credit Risk
On-Balance Sheet 100,523,580,100 -
Off-Balance Sheet 31,506,735,250 -
132,030,315,350 -
Market Risk 9,489,934,111 -
Operational Risk 10,462,877,222 -
Total RWA 151,983,126,683 84,669,322,000
C) Required capital 13,678,481,402 8,466,932,200
D) Surplus (A-C) 3,417,451,325 1,460,228,351
Capital adequacy ratio:
On core capital - against standard of minimum 4.5% 9.21% 8.99%
On total capital - against standard of minimum 9% 11.25% 11.72%

Annual Report - 20 10 135


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
14.7(a) Capital adequacy ratio (CAR) the Group Taka Taka
Core capital (Tier-I)
Paid up capital 6,930,840,400 3,422,637,300
Share premium 1,386,168,060 -
Statutory reserve (Note 15) 3,650,252,294 2,665,605,000
General reserve 247,650,000 247,650,000
Minority interest in subsidiary 100,109,680 -
Retained earnings {Note 18(a)} 1,779,358,967 1,278,871,867
14,094,379,401 7,614,764,167
Supplementary capital (Tier-II)
General provision maintained against unclassified loan/investments 972,200,000 828,000,000
General provision on off-balance sheet items 554,280,000 351,330,000
Exchange equalization reserve - 4,204,046
Asset revaluation reserve 1,064,467,110 1,117,640,994
Revaluation reserve of Government securities 511,396,776 11,221,344
3,102,343,886 2,312,396,384
Additional Supplementary capital (Tier-III) - -

A) Total capital 17,196,723,287 9,927,160,551

B) Risk weighted assets (RWA)


Credit Risk
On-Balance Sheet 100,204,966,100 -
Off-Balance Sheet 31,506,735,250 -
131,711,701,350 -
Market Risk 10,573,348,111 -
Operational Risk 10,472,053,889 -
Total RWA 152,757,103,350 84,669,322,000

C) Required capital 13,748,262,062 8,466,932,200

D) Surplus (A-C) 3,448,540,903 1,460,228,351

Capital adequacy ratio:


On core capital - against standard of minimum 4.5% 9.23% 8.99%
On total capital - against standard of minimum 9% 11.26% 11.72%

15. Statutory reserve

Balance as at 1 January 2,665,605,000 1,975,251,800


Addition during the year ( 20% of pre-tax profit) 984,647,294 690,353,200
Balance as at 31 December 3,650,252,294 2,665,605,000
16. Revaluation reserve
Revaluation reserve of land and buildings
Balance as at 1 January 2,235,281,987 1,181,365,279
Addition during the year - 1,053,916,708
2,235,281,987 2,235,281,987
Deferred tax liabilities (106,347,768) -
Balance as at 31 December 2,128,934,219 2,235,281,987

136 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
Revaluation reserve on HTM securities
Balance as at 1 January 22,442,688 7,918,910
Addition during the year 5,002,198 14,523,778
27,444,886 22,442,688
Adjustment during the year (13,098,640) -
14,346,246 22,442,688
Deferred tax liabilities (6,097,155) -
Balance as at 31 December 8,249,091 22,442,688
Revaluation reserve on HFT securities
Balance as at 1 January 1,452,484,399 59,965,614
Addition during the year 942,922,121 1,392,518,785
2,395,406,520 1,452,484,399
Adjustment during the year (1,380,862,060) -
Balance as at 31 December 1,014,544,460 1,452,484,399
3,151,727,770 3,710,209,074
17. Other reserves

General reserve:
Balance as at 1 January 247,650,000 247,650,000
Addition during the year - -
Balance as at 31 December 247,650,000 247,650,000
Exchange equalisation reserve
Balance as at 1 January 4,204,046 4,204,046
Addition during the year - -
4,204,046 4,204,046
Transfer to retained earnings (4,204,046) -
Balance as at 31 December - 4,204,046
247,650,000 251,854,046 18.
Retained earnings

Balance as at 1 January 1,278,871,867 542,790,957

Add: Retained surplus for the year 1,778,489,174 1,179,832,040


Transfer from Non-repayable share premium account - 485,930,025
Transfer from diminution in the market value of shares - 72,263,000
Transfer from Deferred Tax Liability - 26,325,015
Transfer from Exchange equalization fund 4,204,046 -
1,782,693,220 1,764,350,080
Less : Transfer to SEBL Foundation 50,000,000 30,000,000
Transfer to SEBL Employees welfae fund 35,000,000 -
Issue of bonus share 1,197,923,000 570,439,500
Cash dividend paid - 427,829,670
1,282,923,000 1,028,269,170
Balance as at 31 December 1,778,642,087 1,278,871,867
18(a) Consolidated retained earnings
Southeast Bank Limited 1,778,642,087 1,278,871,867
Southeast Bank Capital Services Limited 796,560 -
1,779,438,647 1,278,871,867
Less: Non-controlling interest 79,680 -
1,779,358,967 1,278,871,867

Annual Report - 20 10 137


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
19. Non-controlling interest

Paid up capital 1,000,000,000 -


Retained earnings 796,560 -
Total net assets 1,000,796,5560 -

Non-controlling interest 10.003% of net assets 100,109,680 -

20. Contingent liabilities

20.1 Acceptances and endorsements

Acceptance under Letters of Credit -Import 13,652,126,205 7,625,122,880


Acceptance under Letters of Credit -Export 10,973,691,963 4,395,033,900
24,625,818,168 12,020,156,780
20.2 Letters of guarantee

Letters of guarantee (Local) 6,272,041,927 6,034,183,466


Letters of guarantee (Foreign) 429,723,271 -
6,701,765,198 6,034,183,466
Less: Margin 432,928,654 466,536,387
6,268,836,544 5,567,647,079

Balance for which the Bank is contingently liable in respect


of guarantee issued favouring:

Directors or officers 4,783,060 6,783,060


Government - -
Banks and other financial institutions - -
Others 6,696,982,138 6,027,400,406
6,701,765,198 6,034,183,466

Less: Margin 432,928,654 466,536,387


6,268,836,544 5,567,647,079
0.3 Irrevocable letters of credit

Back to back L/C 8,034,101,896 4,041,059,383


Others 14,391,464,194 10,972,585,010
22,425,566,090 15,013,644,393
Less: Margin 1,522,363,055 2,256,298,601
20,903,203,035 12,757,345,792
20.4 Bills for collection

Bills for collection (Local) 2,199,074,666 727,119,973


Bills for collection (Foreign) 1,429,670,963 1,332,320,663
3,628,745,629 2,059,440,636

20.5 Value of Bangladesh Sanchaypatra 632,084,000 523,555,000

138 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

20.6 Workers' profit participation fund (WPPF)

As per Bangladesh Labour Act 2006 and SRO no. 336/Law/2010, all companies fall within the scope of WPPF
are required to provide 5% of its profit before charging such expense to their eligible employees within the
stipulated time. The Bank obtained opinion from its legal advisor regarding this issue which stated that the Bank
was not required to make provision for WPPF as bank was not within the scope of WPPF. As such the Bank did
not make any provision during the year for WPPF.
2010 2009
21. Income statement
Taka Taka
Income:
Interest, discount and similar income 11,789,905,591 10,650,537,628
Dividend income 35,198,093 15,500,611
Fees, commission and brokerage 1,112,113,309 1,005,811,745
Gains less losses arising from dealing securities 23,736,125 404,061,294
Gains less losses arising from investment securities 2,196,625,322 795,046,381
Gains less losses arising from dealing in foreign currencies 588,881,131 638,414,447
Income from non-banking assets - -
Other operating income 324,873,820 193,078,838
Profit less losses on interest rate changes - -
16,071,333,391 13,702,450,944
Expenses:
Interest, fees and commission 7,580,851,091 7,843,236,025
Losses on loans and advances - -
Administrative expenses 1,177,039,737 861,057,291
Other operating expenses 421,443,132 292,503,364
Depreciation on banking assets 137,057,947 90,995,493
9,316,391,907 9,087,792,173
Income over expenditure 6,754,941,484 4,614,658,771

22. Interest income/profit on investment

Interest on loans and advances 9,563,144,261 8,384,139,685


Interest on placement with other banks and financial institutions 265,731,548 194,089,779
Interest on foreign currency balances 13,271,277 15,129,164
9,842,147,086 8,593,358,628
Profit on investment (Islamic Banking Branch):
Profit on Bai-Muajjal 176,669,264 148,792,378
Profit on Murabaha 27,504,419 33,801,612
Profit on hire purchase 163,884,607 143,279,541
Profit on Quard against MTDR 46,832,483 42,860,318
414,890,773 368,733,849
10,257,037,859 8,962,092,477
22(a) Consolidated interest income/profit on investments
Southeast Bank Limited 10,257,037,859 8,962,092,477
Southeast Bank Capital Services Limited 18,124,938 -
10,275,162,797 8,962,092,477

Annual Report - 20 10 139


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

23. Interest paid/profit shared on deposits and borrowings etc. 2010 2009
Taka Taka
Interest paid on:
Interest on deposits 6,836,113,042 6,823,792,052
Interest on borrowings 81,204,239 43,992,729
Interest on foreign bank accounts 10,321,431 7,348,130
6,927,638,712 6,875,132,911
Profit shared on deposits (Islamic Banking Branch):
Mudaraba Savings Deposits (MSB) 52,114,145 72,931,036
Mudaraba Short Term Deposits (MSTD) 7,640,058 8,465,013
Mudaraba Fixed Term Deposits (MFDR) 593,458,175 599,469,656
653,212,378 680,865,705
7,580,851,090 7,555,998,616
23(a). Consolidated interest paid/profit shared on deposits and borrowings etc.

Southeast Bank Limited 7,580,851,090 7,555,998,616


Southeast Bank Capital Services Limited 12,955,653 -
7,593,806,743 7,555,998,616
24. Investment income

Interest income from Government Securities (Note 24.1) 1,532,867,732 1,428,070,534


Capital Gain on Government Securities (Note 24.2) 120,084,210 401,294,520
Revaluation gain/(loss) on Government Securities (Note 24.3) (96,348,085) (24,096,018)
Dividend on investment in shares 35,198,093 15,500,611
Gain on sale of investment in shares 2,196,625,322 795,046,381
3,788,427,272 2,615,816,028

Figures of previous year have been rearranged, wherever considered necessary, to conform the current year's
presentation.

24.1 Interest Income from Government Securities

Interest on treasury bills 71,109,131 311,066,684


Interest on treasury bonds/T&T bonds 2,014,708,240 1,377,378,466
2,085,817,371 1,688,445,150

Interest Expenses on treasury bills (6,138,118) -


Interest Expenses on treasury bonds (546,811,521) (260,374,616)
(552,949,639) (260,374,616)
Net Interest Income from Government Securities 1,532,867,732 1,428,070,534

24.2 Capital Gain on Government Securities

Capital Gain on treasury bills 11,509,684 28,606,686


Capital Gain on treasury bonds/T&T bonds 161,290,195 374,446,008
172,799,879 403,052,694

Capital loss on treasury bills (7,744,999) (1,687,756)


Capital loss on treasury bonds/T&T bonds (44,970,670) (70,418)
(52,715,669) (1,758,174)
Net capital gain on Government Securities 120,084,210 401,294,520

140 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
24.3 Revaluation Gain/(loss) on Government Securities Taka Taka

Revaluation gain on treasury bills 45,812,782 1,008,600


Revaluation gain on treasury bonds 71,519,893 -
117,332,675 1,008,600

Revaluation loss on treasury bills (59,243,803) -


Revaluation loss on treasury bonds (154,436,957) (25,104,618)
(213,680,760) (25,104,618)
Net revaluation gain/(loss) on Government Securities (96,348,085) (24,096,018)

25. Commission, exchange and brokerage

Commission and brokerage 1,112,113,309 1,005,811,745


Exchange gain (Note 25.1) 588,881,131 638,414,447
1,700,994,440 1,644,226,192
25.1 Exchange gain

Exchange gain from revaluation/trade of foreign currency 574,301,101 635,638,460


Exchange gain from credit card 14,580,030 2,775,987
588,881,131 638,414,447
26. Other operating income

Remittance fees 1,849,284 2,798,942


Service and incidental charges 55,656,992 62,304,550
Management fees-portfolio 46,692,619 -
Settlement fees-Portfolio account 82,006,192 -
Other Fees-Telephone and Postage 33,252,763 26,927,129
Income from ATM services 76,640 224,744
Income from Credit Card 26,025,313 33,021,285
On-line services fees 784,026 8,914,038
Other Fees - SWIFT 41,914,958 36,196,642
Demat and Custody Fees 666,092 210,000
Gain on sale of fixed assets (Note 26.1) 1,662,979 -
Recovery of written off loans 25,100,439 3,827,501
Miscellaneous income 9,185,523 18,654,006
324,873,820 193,078,837
26.1 Gain on sale of fixed assets

Cost:
Motor vehicle 1,438,144 1,546,043
Furniture and fixtures 542,258 150,000
Office appliances 238,100 187,350
Electrical appliances 4,750,617 1,175,000
6,969,119 3,058,393
Accumulated depreciation:
Motor vehicle 1,421,061 1,536,043
Furniture and fixtures 175,086 61,585
Office appliances 238,100 187,350
Electrical appliances 2,740,073 740,258
4,574,320 2,525,236
Written down value 2,394,799 533,157
Sale proceeds of the above fixed assets 4,057,778 533,157
Gain on sale of fixed assets 1,662,979 -

Annual Report - 20 10 141


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
26(a) Consolidated other operating income Taka Taka

Southeast Bank Limited 324,873,820 193,078,837


Southeast Bank Capital Services Limited 11,354,273 -
336,228,093 193,078,837
27. Salaries and allowances

Basic salary 348,807,202 248,639,935


Allowances 225,883,662 164,505,553
Bonus 128,628,129 94,204,301
Provident fund 25,809,345 18,665,539
729,128,338 526,015,328
27(a) Consolidated salaries and allowances

Southeast Bank Limited 729,128,338 526,015,328


Southeast Bank Capital Services Limited 306,100 -
729,434,438 526,015,328

28 Rent, taxes, insurance, electricity etc.

Rent, rates and taxes 134,919,560 99,877,702


Insurance 60,189,336 45,647,397
Electricity and lighting 33,362,949 25,033,037
228,471,845 170,558,136

28(a) Consolidated rent, taxes, insurance, electricity etc.

Southeast Bank Limited 228,471,845 170,558,136


Southeast Bank Capital Services Limited 41,100 -
228,512,945 170,558,136
29. Postage, stamp, telecommunication etc.

Postage 27,269,430 18,338,929


Telephone 8,007,679 7,982,893
Telex 285 985
Electronic banking service 3,060,682 1,871,341
FC Charge (Nostro) 1,315,867 1,405,453
VSAT on-line 19,582,301 9,566,603
Reuters services 7,159,546 4,014,609
SWIFT services 11,920,846 10,837,388
78,316,636 54,018,201
29(a) Consolidated postage, stamp, telecommunication etc.

Southeast Bank Limited 78,316,636 54,018,201


Southeast Bank Capital Services Limited 16,850 -
78,333,486 54,018,201
30. Stationery, printing, advertisements etc.

Office stationery 9,847,735 9,361,798


Printing stationery 18,797,480 16,740,478
Security stationery 7,427,815 2,737,044
Computer stationery 8,193,404 7,662,523
Publicity and advertisement 36,402,443 30,213,346
80,668,877 66,715,189

142 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
30(a) Consolidated stationery, printing, advertisements etc. Taka Taka

Southeast Bank Limited 80,668,877 66,715,189


Southeast Bank Capital Services Limited 21,209 -
80,690,086 66,715,189
31. Managing Director's salary and fees

Basic Salary 5,100,000 3,922,500


House Rent 1,440,000 951,000
House Maintenance 600,000 1,815,000
Leave Fare Concession (LFC) 500,000 300,000
Special Allowance 1,200,000 720,000
Watch & Ward Duty at Residence 300,000 232,500
Cook & Gardener 360,000 279,000
Bonus 850,000 850,000
Provident Fund - 137,250
10,350,000 9,207,250
32. Directors' fees and expenses

Directors' fees 1,953,500 2,034,000


Directors' haltage and travelling 1,056,879 1,406,553
3,010,379 3,440,553
32(a) Consolidated directors' fees and expenses

Southeast Bank Limited 3,010,379 3,440,553


Southeast Bank Capital Services Limited 30,000 -
3,040,379 3,440,553
33. Consolidated auditors' fees

Southeast Bank Limited 500,000 500,000


Southeast Bank Capital Services Limited 25,000 -
525,000 500,000
34. Depreciation on and repairs of Bank's assets

Depreciation on own assets:


Building 37,938,334 16,572,347
Furniture and fixtures 33,594,452 25,172,229
Office appliance 748,412 353,743
Electrical appliance 50,620,256 33,307,230
122,901,454 75,405,549
Depreciation on leased assets:
Furniture and fixtures 6,262,219 6,958,021
Electrical appliance 3,859,203 4,824,007
Motor vehicles 4,035,071 3,807,916
14,156,493 15,589,944
Repairs:
Furniture and fixtures 3,114,337 2,545,299
Office and electrical appliance 28,449,340 15,024,999
Motor vehicles 2,242,426 2,055,715
Repair, maintenance and utilities 12,493,413 10,617,368
46,299,516 30,243,381
183,357,463 121,238,874

Annual Report - 20 10 143


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka
34(a) Consolidated depreciation and repairs

Southeast Bank Limited 183,357,463 121,238,874


Southeast Bank Capital Services Limited 139,246 -
183,496,709 121,238,874
35. Other expenses

Security and cleaning 49,488,201 34,670,512


Entertainment - Office and AGM 22,781,835 19,263,149
Business promotion expenses 10,228,861 9,609,360
Car expenses 61,475,518 56,020,973
Books and periodicals 1,082,316 625,440
Subscription and donation 27,729,891 28,329,969
Travelling expenses 6,521,302 5,868,915
Finance charge on leased assets 2,546,741 5,281,353
Conveyance 6,379,249 4,585,182
Fuel 3,766,617 3,373,652
Training/seminar 2,386,978 1,581,453
Uniforms and apparels 1,540,285 1,152,648
Medical expenses 1,007,233 3,882,374
Gratuity 65,369,500 35,000,000
Professional expenses 4,295,945 3,092,091
Expenses for CIB report 165,939 138,150
Expenses regarding credit card 23,536,022 20,631,710
Miscellaneous 131,140,698 59,396,432
421,443,131 292,503,363
35(a) Consolidated other expenses

Southeast Bank Limited 421,443,131 292,503,363


Southeast Bank Capital Services Limited 1,618,893 -
423,062,024 292,503,363
36. Provision for diminution in value of investments

Provision to be maintained for the year 2010 32,500,000 78,000,000


Provision has already been maintained last year (78,000,000) (150,263,000)
Loss against sale of shares 29,055,015 -
Excess provision transferred to Retained Earnings/profit or loss account (16,444,985) (72,263,000)

36(a) Consolidated provision for diminution in value of investments

Southeast Bank Limited (16,444,985) (72,263,000)


Southeast Bank Capital Services Limited 8,156,600 -
(8,288,385) (72,263,000)
37. Tax expense

Current tax 2,145,600,000 1,581,579,531


Deferred tax 14,500,000 -
2,160,100,000 1,581,579,531

144 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
Taka Taka

6,754,941,483 4,614,658,771

Income tax using the tax rate @ 42.5% 2,870,850,130 1,961,229,977

Non-deductible expenses 148,183,194 93,746,889


Deductible expenses (88,769,455) (66,353,652)
Tax exempted income (74,051,857) (175,976,050)
Dividend income (7,919,571) (3,487,637)
Capital gain from sale of shares in stock market (704,460,350) (258,390,074)
Additional current tax provision 1,767,909 30,810,078
14,500,000 -
Total income tax expenses 2,160,100,000 1,581,579,531

37(a) Consolidated tax expense

Current tax
Southeast Bank Limited 2,145,600,000 1,581,579,531
Southeast Bank Capital Services Limited 5,372,000 -
2,150,972,000 1,581,579,531
Deferred tax
Southeast Bank Limited 14,500,000 -
Southeast Bank Capital Services Limited - -
14,500,000 -
2,165,472,000 1,581,579,531
38. Cash received from other operating activities

Remittance fees 1,849,284 2,798,942


Service and incidental charges 55,656,992 62,304,550
Revaluation gain on government securities 117,332,674 -
Management fees-portfolio 46,692,619 -
Settlement fees-Portfolio account 82,006,192 -
Other Fees-Telephone/Telex/Postage 33,252,763 26,927,129
Income from ATM services 76,640 224,744
Income from Credit Card 26,025,313 33,021,285
On-Line services 784,026 8,914,038
Other Fees - SWIFT 41,914,958 36,196,642
Demat and Custody Fees 666,092 210,000
Miscellaneous income 9,185,523 18,654,006
415,443,076 189,251,336
38(a) Consolidated cash received from other operating activities

Southeast Bank Limited 415,443,076 189,251,336


Southeast Bank Capital Services Limited 11,354,273 -
426,797,349 189,251,336
39. Payments for other operating activities

Rent, rates and taxes 243,956,118 198,465,180


Postage 78,316,636 54,018,202
Directors fees 3,010,379 3,440,553
Repairs 46,299,515 30,243,381
Others expenses 356,867,779 293,362,614
728,450,427 579,529,930

Annual Report - 20 10 145


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010
2010 2009
39(a) Consolidated Payments for other operating activities Taka Taka

Southeast Bank Limited 728,450,427 579,529,930


Southeast Bank Capital Services Limited 1,731,843 -
730,182,270 579,529,930
40. Earnings per share

2,763,136,468 1,870,185,240
Number of ordinary shares outstanding 61,134,224 57,653,812
Earnings per share (EPS) (Taka) 45.20 32.44

40(a) Consolidate earnings per share

2,763,933,028 1,870,185,240
Number of ordinary shares outstanding 61,134,224 57,653,812
Earnings per share (EPS) (Taka) 45.21 32.44

41. General

41.1 Audit Committee

Audit Committee of the Board of Directors of the Bank has been re-constituted by the Board of Directors in its
354th Meeting held on 29 March 2010 comprising the following members:

Sl. Status with


no. Name the committee

1) Mr. Azim Uddin Ahmed, Director Chairman MA

2) Mr. M. A. Kashem, Director Member Commerce Graduate

3) Dr. Zaidi Sattar, Independent Director Member Ph. D. in Economics

Functions of the Bank's Audit Committee


i) Review of the appropriateness of the Bank's accounting policy
ii) Overseeing the Bank's relationship with external auditors
iii) Review of the Bank's existing system and upgradation of systems
iv) Review of the Bank's annual audit plan
v) Review of all reports of internal auditors
vi) Review of Management's report on risk management
vii) Review of Audit Committee's own terms of reference within the purview of BRPD Circular No.12 dated
23 December 2002 of Bangladesh Bank.

During the year 2010, the audit Committee held 4(four) meetings. On invitation, senior executives of the Bank

Division and Head of Credit Risk Management Division attended the meeting of the Audit Committee to
instantly meet the queries of the Audit Committee and take directives for improvement. In those meetings,
annual audit plan of the Bank was reviewed, performance of the internal and external auditors was widely

were given to the management.

146 Annual Report - 20 10


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

The Audit Committee gave directives for pragmatic steps for reduction of classified loans by recoveries and
regularization of classified loans, rectification of lapses and irregularities, punishment of delinquent employees for
any misconduct, Basel-II compliance completion of incomplete documentation formalities initiation of legal
action against reconciliation borrowers, constant monitoring of top 20 (twenty) borrowers and compliance of
rules and regulations of all regulatory bodies. The decision and directives of the Audit Committee have been
implemented or are being complied with to upgrade the Banks operational status and better placement in credit-
ing and CAMELS.

41.2 Related party/(ies)


i) Particulars of Directors of the Bank as on 31 December 2010

Sl. % of shares as
No. Name of persons Designation Present address on 31 Dec 2010

1. Mr. Alamgir Kabir, FCA Chairman 226, Dilu Road, New Eskaton
Dhaka 1.24
2 Mr. Ragib Ali Vice Chairman House No.06, Road No.76,
Gulshan, Dhaka-1212 2.82
3 Mr. M. A. Kashem Director 73/C, Gulshan Avenue, Gulshan,
Dhaka-1212 2.83
4 Mr. Azim Uddin Ahmed Director 14, Topkhana Road, Segunbagicha
Dhaka-1000 2.74
5 "Bangla Capital Limited T.K. Bhaban (11th Floor), 13,
(represented by Mr. Tahnoun A. Harun)" Director Kawran Bazar, Dhaka-1215 0.15
6 Mrs. Jusna Ara Kashem Director 73/C, Gulshan Avenue, Gulshan
Dhaka-1212 0.66
7 Mrs. Duluma Ahmed Director 14, Topkhana Road, Segunbagicha
Dhaka-1000 2.05
8 Mr. Syed Shahid Ali Director Saleha Monzil, Diganto #7 0.28
Roy Hussain R. A., Electric Supply
Road, Amborkhana, Sylhet
9 Mrs. Rehana Rahman Director House No.10, Road No.68 1.27
Gulshan, Dhaka-1212
10 Mr. Md. Akikur Rahman Director Sonarpara, Nobarun-227, Sylhet 0.92
11 Mr. Monjur Miah Director Roy Nagar, Rajbari, Sylhet 0.48
12 Mrs. Sirat Monira Director 226, Dilu Road, (Ground Floor)
New Eskaton, Dhaka 0.01
13 Karnafuli Tea Company Limited Director 67, Motijheel C/A, Dhaka -1000 0.02
(represented by Mr. Abdul Hye)
14 Dr. Zaidi Sattar Independent Director House No.41, Road No.35A
Gulshan, Dhaka-1212 -
15 Mr. A. H. M. Moazzem Hossain Depositor Director Apartment #A-16, Building #03
Ramna Estate Complex
Bara Moghbazar, Dhaka-1217 -
16 Mr. Mahbubul Alam Managing Director Southeast Bank Limited
Head Office, 52-53 Dilkusha C/A
Dhaka-1000. -

ii) As of the date of these financial statements the Bank had no transactions with the related party/(ies) as
defined in the BRPD Circular No. 14 issued by the Bangladesh Bank on 25 June 2003.

Annual Report - 20 10 147


Southeast Bank Limited and its subsidiary
Notes to the Financial Statements as at and for the year ended 31 December 2010

41.2.1 Related party transactions

During the year 2010, the Bank concluded business deals with the following organizations in which the directors
had interest:
Nature of
Name of organization Relationship transactions Amounts

Asia Insurance Ltd. Common director Insurance 8,378,206


coverage
Southeast Bank Capital Services Limited Group Company Interest on loan 12,955,653

41.2.2 Loans and advances to directors and their related concern

Name of the Nature of Amount


Name of party director Related by transaction in Taka Status

Monorom Traders Mr. Azim Uddin Ahmed Director Bank Guarantee 4,783,060 Regular
Mrs. Duluma Ahmed Director

41.3 Events after the reporting period

a cash dividend @ 10% subject to the approval of the shareholders at the next Annual General Meeting.

41.4 Number of employees

Tk 36,000 or above were 1613 (2009: 1402).

41.5 Share trading

December 2010 was Tk. 600.25 at DSE and Tk. 595.00 at CSE.

41.6 General

Highlights on the overall activities of the Bank have been furnished in Annexure - A.

41.7 Coverage of external audit

Bank's risk weighted assets as on the reporting date.

148 Annual Report - 20 10


Southeast Bank Limited Annexure-A
Highlights on the overall activities as at and for the year ended 31 December 2010

Sl
no. Particulars 2010 2009

1 Paid-up capital Taka 6,930,840,400 3,422,637,300


2 Total capital Taka 17,095,896,727 9,927,160,551
3 Capital surplus Taka 3,417,415,325 1,460,228,351
4 Total assets Taka 131,943,476,150 112,676,984,924
5 Total deposits Taka 107,729,587,773 96,669,052,139
6 Total loans and advances/investments Taka 92,452,615,493 77,497,573,199
7 Total contingent liabilities and commitments Taka 58,013,979,085 35,650,980,275
8 Credit deposit ratio 85.82% 80.17%
9 Percentage of classified loans/investments against
total loans and advances/investments 4.26% 3.73%
10 Profit after tax and provision Taka 2,763,136,468 1,870,185,240
11 Amount of classified loans/investments Taka 3,938,492,848 2,892,999,553
12 Provisions kept against classified loans/investments Taka 1,862,746,840 1,130,742,922
13 Provision surplus/(deficit) against classified loans/investments Taka 284,035,431 10,728,686
14 Cost of fund 7.63% 9.16%
15 Interest earning assets Taka 108,389,127,376 96,174,903,386
16 Non-interest earning assets Taka 13,554,348,775 16,501,581,537
17 Return on investment (ROI) 2.36% 2.01%
18 Return on assets (ROA) [PAT/ Average assets] 2.26% 1.66%
19 Income from investment Taka 3,788,427,272 2,615,816,028
20 Capital adequacy 11.25% 11.72%
21 Stock dividend 20% 35%
22 Earnings per share Taka 45.20 32.44
23 Net income per share Taka 45.20 32.44
24 Price earning ratio Times 13.28 6.09

Annual Report - 20 10 149


Southeast Bank Limited Annexure-B

150
Consolidated Liquidity Statement
(Analysis of maturity of assets and liabilities)
as at 31 December 2010

Particulars Up to 1 month 1-3 months 3-12 months 1-5 years Above 5 years Total
Taka Taka Taka Taka Taka Taka
Assets:
Cash in hand 1,521,172,604 - - 5,774,410,000 - 7,295,582,604
Balance with other banks and financial institutions 1,156,032,017 1,225,075,102 650,000,000 - - 3,031,107,119
Money at call and on short notice 509,500,000 - - - - 509,500,000
Investments 4,102,600 2,465,611,685 1,476,504,305 3,232,007,202 11,690,845,445 18,869,071,237
Loans and advances / investments 16,910,533,493 17,068,994,830 31,522,946,000 18,857,218,000 9,621,510,000 93,981,202,323
Fixed assets including premises, furniture and fixtures - - - 335,258,981 4,128,380,012 4,463,638,993
Other assets 61,502,411 2,835,320,199 737,345,640 - - 3,634,168,250
Non banking assets - - - - - -
Total assets (A) 20,162,843,125 23,595,001,816 34,386,795,945 28,198,894,183 25,440,735,457 131,784,270,526

Liabilities:
Borrowings from Bangladesh Bank, other banks,
financial institutions and agents 280,000,000 - 400,000,000 296,452,941 - 976,452,941
Deposits 18,434,083,318 24,183,287,000 39,721,332,000 19,613,369,000 5,301,119,000 107,253,190,318
Provision and other liabilities 347,345,286 282,135,145 1,287,884,081 763,638,627 3,627,516,957 6,308,520,096
Total liabilities (B) 19,061,428,604 24,465,422,145 41,409,216,081 20,673,460,568 8,928,635,957 114,538,163,355
Net liquidity gap (A - B) 1,101,414,521 (870,420,329) (7,022,420,136) 7,525,433,615 16,512,099,500 17,246,107,171

Annual Report - 20 10
Southeast Bank Limited Annexure-B.1
Liquidity Statement
(Analysis of maturity of assets and liabilities)
as at 31 December 2010

Annual Report - 20 10
Particulars Up to 1 month 1-3 months 3-12 months 1-5 years Above 5 years Total
Taka Taka Taka Taka Taka Taka
Assets:
Cash in hand 1,521,172,604 - - 5,774,410,000 - 7,295,582,604
Balance with other banks and financial institutions 1,156,032,017 1,225,075,102 650,000,000 - - 3,031,107,119
Money at call and on short notice 509,500,000 - - - - 509,500,000
Investments 4,102,600 1,924,187,721 1,476,504,305 3,232,007,202 11,690,845,445 18,327,647,273
Loans and advances / investments 16,910,533,493 15,540,408,000 31,522,946,000 18,857,218,000 9,621,510,000 92,452,615,493
Fixed assets including premises, furniture and fixtures - - - 334,701,998 4,128,380,012 4,463,082,010
Other assets 61,502,411 4,165,123,600 737,345,640 - 899,970,000 5,863,941,651
Non banking assets - - - - - -
Total assets (A) 20,162,843,125 22,854,794,423 34,386,795,945 28,198,337,200 26,340,705,457 131,943,476,150

Liabilities:
Borrowings from Bangladesh Bank, other banks
financial institutions and agents 280,000,000 - 400,000,000 296,452,941 - 976,452,941
Deposits 18,410,480,773 24,683,287,000 39,721,332,000 19,613,369,000 5,301,119,000 107,729,587,773
Provision and other liabilities 347,345,286 64,405,749 1,287,884,081 763,638,627 3,628,881,082 6,092,154,825
Total liabilities (B) 19,037,826,059 24,747,692,749 41,409,216,081 20,673,460,568 8,930,000,082 114,798,195,539
Net liquidity gap (A - B) 1,125,017,066 (1,892,898,326) (7,022,420,136) 7,524,876,632 17,410,705,375 17,145,280,611

151
Southeast Bank Limited Annexure-C

152
Balance with other banks-Outside Bangladesh(Nostro Account)
as at 31 December 2010

2010 2009
Currency FC Exchange Equivalent FC Exchange Equivalent
Name of the Bank type amount rate Taka amount rate Taka

Interest bearing :
Standard Chartered Bank, New York USD 1,065,459 70.7497 75,380,904 162,350 69.2667 11,245,447
Standard Chartered Bank, New York USD 2,503,786 70.2700 175,941,057 - - -
Citibank, NA, New York, USA USD 268,270 70.7497 18,980,057 1,147,993 69.2667 79,517,685
HSBC Bank , New York, USA USD 353,272 70.7497 24,993,908 1,979,007 69.2667 137,079,316
HSBC Bank PLC, London, UK GBP 635,730 109.91 69,872,782 504,742 110.0025 55,522,881
Mashreq Bank PSC, New York, USA USD 3,489,847 70.7497 246,905,610 3,016,779 69.2667 208,962,332
Wells Fargo Bank, N.A., New York, USA USD 1,593,082 70.7497 112,710,060 552,895 69.2667 38,297,211
Citibank AG, Frankfurt, Germany EUR 117,511 93.6302 11,002,585 256,572 99.1276 25,433,403
Standard Chartered Bank, Kolkata, India ACUD 153,093 70.7497 10,831,283 274,090 69.2667 18,985,301
Arab Bangladesh Bank Ltd., Mumbai, India ACUD 486,916 70.7497 34,449,169 366,307 69.2667 25,372,899
ICICI Bank Ltd., Mumbai, India ACUD 614,513 70.7497 43,476,635 640,693 69.2667 44,378,668
JP Morgan Chase Bank, New York, USA USD 222,013 70.7497 15,707,367 28,499 69.2667 1,974,058
Habib American Bank, New York, USA USD 335,678 70.7497 23,749,121 658,046 69.2667 45,580,662
Mashreq Bank, Mumbai, India ACUD 333,995 70.7497 23,630,032 - - -
Mashreq Bank, Mumbai, India ACUEUR 36,746 93.6302 3,440,519 - - -
891,071,089 692,349,863
Non-interest bearing :
Bank of Nova Scotia, Toronto, Canada CAD 44,656 70.7568 3,159,715 30,064 66.1699 1,989,364
United Bank Limited, Karachi, Pakistan ACUD 784,099 70.7497 55,474,785 89,024 69.2667 6,166,397
Standard Chartered Bank, Colombo, Srilanka ACUD 147,650 70.7497 10,446,227 16,559 69.2667 1,146,974
Standard Chartered Bank, Mumbai (AEB), India ACUD 327,274 70.7497 23,154,511 25,470 69.2667 1,764,223
Nepal Bangladesh Bank Ltd., Kathmandu, Nepal ACUD 18,037 70.7497 1,276,113 54,092 69.2667 3,746,775
Bank of Bhutan, Pheuntsholing, Bhutan ACUD 15,285 70.7497 1,081,374 5,115 69.2667 354,265
Bank of Tokyo Mitsubishi, Kolkata, India ACUD 25,255 70.7497 1,786,784 25,255 69.2667 1,749,331
Commerz Bank, Frankfurt, Germany EUR 334,613 93.6302 31,329,842 110,672 99.1276 10,970,625
U. B. A. F., Tokyo, Japan JPY 33,942,332 0.8683 29,472,127 7,718,547 0.7509 5,796,165
Zuercher Kantonal Bank, Zurich, Switzerland CHF 75,510 75.1138 5,671,874 93,804 66.6603 6,252,988
National Australia Bank Ltd. Melbourne, Australia AUD 67,909 71.9241 4,884,290 37,133 61.6959 2,290,950
167,737,642 42,228,057
1,058,808,731 734,577,920

Annual Report - 20 10
Southeast Bank Limited Annexure-D
Investment in Shares as at 31 December 2010

Quoted rate Total


No. of per share market
Sl. Type of Face shares Cost of Average as at value as at
no. Name of the company shares value including holding cost 31-Dec-10 31-Dec-10
Taka bonus shares Taka Taka Taka Taka
Quoted
1 Asia Insurance A 10 702,950 61,268,058 87.16 232.70 163,576,465
2 Beximco Pharma A 10 1,944,939 244,387,644 125.65 135.10 262,761,259
3 Beximco Limited A 10 50,000 16,269,238 325.38 311.50 15,575,000
4 Bay Leasing & Investment A 100 47 112,836 2,400.77 2,926.25 137,534
5 Exim Bank Limited A 10 5,234,113 277,466,126 53.01 58.00 303,578,554
6 First Security Bank Ltd A 10 330,058 3,300,580 10.00 40.60 13,400,355
7 H.R. Textile A 100 28 2,137 76.32 544.75 15,253
8 KPCL A 10 60,000 8,394,665 139.91 112.60 6,756,000
9 Lafarge Cement Z 100 483,300 290,381,578 600.83 563.75 272,460,375
10 Maksons Spinning Mills A 10 451 11,275 25.00 68.40 30,848
11 Metro Spinning A 10 372 4,470 12.02 87.00 32,364
12 National Life Ins. A 100 15,997 47,996,222 3,000.33 7,532.00 120,489,404
13 National Tea A 100 9,451 7,478,475 791.29 5,787.00 54,692,937
14 RAK Ceremic N 10 118 5,664 48.00 171.60 20,249
15 Rupali Bank Z 100 3,610 9,074,723 2,513.77 1,736.50 6,268,765
16 Singer BD A 100 135 589,155 4,364.11 7,352.00 992,520
17 SIBL A 10 20 616 30.80 35.20 704
18 Sumitpower A 10 210,000 32,112,348 152.92 140.10 29,421,000
19 Titas Gas A 100 75,700 80,732,923 1,066.49 999.00 75,624,300
20 TRUST Bank 1ST MF. A 10 440,000 9,068,228 20.61 17.40 7,656,000
21 Trust Bank Ltd. A 100 42 29,930 712.62 753.25 31,637
9,561,331 1,088,686,891 1,333,521,522

Unquoted

1 Industrial & Infrastructure Development


2 Finance Co. Ltd. 100 188,140 10,000,000 53 - -
3 Shares in Karmasangsthan Bank 100 100,000 10,000,000 100 - -
4 Central Depository Bangladesh Ltd. 10 1,083,334 8,833,340 8.15 - -
5 Venture Investment Partner 100 180,000 18,000,000 100 - -
6 STS Holding Limited 10 8,000,000 80,000,000 10 - -
7 Dun & Breasdstreet Rating Agency 100 41659 4,165,900 100 - -
8 Aftab Automobile Limited 10 2,000,000 200,000,000 100 - -
9 Summit Power Limited 10 870,000 87,000,000 100 - -
Southeast Bank 1st Mutual Fund 10 2,500,000 250,000,000 100 - -
14,963,133 667,999,240

Annual Report - 20 10 153


Southeast Bank Limited Annexure-F
Details of Large Loan as at 31 December 2010

2010 2009
Number of clients 18 32
Amount of outstanding advances (Taka) 30,954.50 33,619.70
Amount of classified advances (Taka) NIL NIL
Measures taken for recovery (Taka) NIL NIL

Client-wise break up is as follows:

Outstanding (Taka) 2010 Outstanding (Taka) 2009


Sl.
no. Name of clients Funded No Funded Total Funded No Funded Total
1 Deshbandhu Sugar Mills Ltd. and its related concern, 559.40 1,121.40 1,680.80 78.30 1,230.00 1,308.30
2 NRG Spinning Mills Ltd. 1,272.40 1,008.60 2,281.00 - - -
3 Generation Next Fashions Limited 1,181.60 458.70 1,640.30 896.90 533.50 1,430.40
4 Faar Ceramics Limited - - - 818.70 22.60 841.30
5 Nurjahan Super Oil Limited - - - 1,128.80 542.10 1,670.90
6 S. S. Steel (Pvt.) Limited - - - 440.30 235.30 675.60
7 United Edible Oils Ltd. and its related concern 483.40 1,969.50 2,452.90 229.20 1,011.20 1,240.40
8 MAB Spinning Ltd. and its related concern - - - 900.00 13.90 913.90
9 Shore to Shore (BD) Ltd. and its related concern - - - 163.30 39.60 202.90
10 Chittagong Asian Apparels Ltd. and its related concern - - - 97.90 410.60 508.50
11 Maksons Spinning Mills - - - 696.80 4.30 701.10
12 T. K. Group - - - 349.50 1,355.80 1,705.30
13 Chaity Composite Ltd. and its related concern 1,531.80 486.60 2,018.40 1,241.10 169.90 1,411.00
14 Khaleque Knitting and Garments Industries (Pvt.) 998.40 2,260.70 3,259.10 1,030.90 1,460.80 2,491.70
15 ACS Textile (Bangladesh) Limited 1,274.40 1,749.50 3,023.90 1,000.40 1,142.30 2,142.70
16 PHP Continuous Galvanizing Mills Ltd. And its related concern 187.20 338.30 525.50 276.10 326.50 602.60
17 Navana Group - - - 682.80 252.00 934.80
18 Mostafa Paper Complex Ltd. and its related concern - - - 614.80 - 614.80
19 J. K. Enterprise and its related concern - - - 811.40 218.50 1,029.90
20 Bay Leasing and Investment Limited - - - 470.30 24.90 495.20
21 Masuma Khatun Textile Industries Ltd. 1,271.50 758.60 2,030.10 920.80 405.50 1,326.30
22 Marrine Vegetable Oils Ltd. and its related concern 597.80 1,354.90 1,952.70 715.10 - 715.10
23 Abul Khair Steel Industries Ltd. and its related concern 934.40 3,038.90 3,973.30 501.80 1,157.90 1,659.70
24 Nasa Taipei Spinners Ltd. and its related concern - - - 291.60 23.30 314.90
25 Partex Sugar Mills Ltd. and its related concern - - - 784.80 391.60 1,176.40
26 S. Alam Colled Rolled Steel Limited - - - 668.90 306.50 975.40
27 Appollo Ispat Complex Ltd. and its related concern - - - 919.20 350.70 1,269.90
28 Mahbub Spinning Ltd. and its related concern - - - 805.30 6.70 812.00
29 Refat Garments Ltd. and its related concern 225.60 247.60 473.20 223.00 440.10 663.10
30 Biswas Fashion Ltd. and its related concern - - - 861.90 213.80 1,075.70
31 Fahami Apparels Ltd. and its related concern - - - 1,243.40 233.40 1,476.80
32 Concrete and Steel Technologies Ltd. And its related concern - - - 429.60 120.00 549.60
33 Ahmed Muztaba Steel Industries Limited 562.40 - 562.40 - - -
34 KYCR Coil Industries Ltd. and its related concern - - - 145.70 537.80 683.50
35 Kabir Steel Ltd. and its related concern 286.00 - 286.00 - - -
36 Toma Construction Company Ltd., Toma Properities Ltd. - - - - - -
37 S. N. Corporation 946.50 - 946.50 - - -
38 S. Alam Super Edible Oil Ltd. 1,310.60 - 1,310.60 - - -
39 S. Alam Vegetable Oil Ltd. 411.30 1,649.50 2,060.80 - - -
40 Bashundhara Group 398.40 78.60 477.00 - - -
Total 14,433.10 16,521.40 30,954.50 20,438.60 13,181.10 33,619.70

154 Annual Report - 20 10


Southeast Bank Limited and its subsidiary Annexure-F

Schedule of fixed assets including premises, furniture and fixtures as at 31 December 2010
Cost/Revaluation Depreciation Written

Annual Report - 20 10
Particulars Balance Additions Revalued Disposal Balance Balance Charged Adjustment Balance down value
as at during during during as at Rate of as at during for disposal as at as at
1 January the year the year the year 31 December dep. 1 January the year during the year 31 December 31 December
Taka Taka Taka Taka Taka % Taka Taka Taka Taka Taka

Own assets
Office:
Land 2,784,940,544 95,000 - - 2,785,035,544 0 - - - - 2,785,035,544
Building 1,065,280,239 40,000 - - 1,065,320,239 4 75,426,046 37,938,334 - 113,364,380 951,955,859
Furniture and fixtures 347,271,552 87,777,303 - (92,258) 434,956,597 10 67,762,719 33,445,473 (71,137) 101,137,055 333,819,542
Office Appliances 4,269,062 2,774,663 - (238,100) 6,805,625 20 1,796,456 748,412 (238,100) 2,306,768 4,498,857
Electrical Appliances 251,196,756 165,971,875 - (3,250,617) 413,918,014 20 84,388,029 49,431,906 (1,696,658) 132,123,277 281,794,737
Motor vehicles 1,509,933 - - (17,083) 1,492,850 20 1,463,599 - - 1,463,599.00 29,251
4,454,468,086 256,658,841 - (3,598,058) 4,707,528,869 230,836,849 121,564,125 (2,005,895) 350,395,079 4,357,133,790

Residence of executives:
Furniture and fixtures 1,895,290 425,000 - (450,000) 1,870,290 10 616,167 148,979 (103,949) 661,197 1,209,093
Electrical Appliances 11,108,694 2,250,000 - (1,500,000) 11,858,694 20 6,210,552 1,188,350 (1,043,415) 6,355,487 5,503,207
13,003,984 2,675,000 - (1,950,000) 13,728,984 6,826,719 1,337,329 (1,147,364) 7,016,684 6,712,300
4,467,472,070 259,333,841 - (5,548,058) 4,721,257,853 237,663,568 122,901,454 (3,153,259) 357,411,763 4,363,846,090

Leased assets
Furniture and fixtures 106,051,227 - - - 106,051,227 10 43,429,035 6,262,219 - 49,691,254 56,359,973
Electrical Appliances 58,886,808 - - - 58,886,808 20 39,590,787 3,859,203 - 43,449,990 15,436,818
Motor vehicles 24,120,283 19,610,380 - (1,421,061) 42,309,602 20 12,256,463 4,035,071 (1,421,061) 14,870,473.00 27,439,129
189,058,318 19,610,380 - (1,421,061) 207,247,637 95,276,285 14,156,493 (1,421,061) 108,011,717 99,235,920
4,656,530,388 278,944,221 - (6,969,119) 4,928,505,490 332,939,853 137,057,947 (4,574,320) 465,423,480 4,463,082,010

155
Southeast Bank Limited and its subsidiary Annexure-F.1

156
Schedule of fixed assets including premises, furniture and fixtures as at 31 December 2010
Cost/Revaluation Depreciation Written
Particulars Balance Additions Revalued Disposal Balance Balance Charged Adjustment Balance down value
as at during during during as at Rate of as at during for disposal as at as at
1 January the year the year the year 31 December dep. 1 January the year during the year 31 December 31 December
Taka Taka Taka Taka Taka % Taka Taka Taka Taka Taka

Own assets
Office:
Land 1,656,437,566 350,675,716 777,827,262 - 2,784,940,544 0 - - - - 2,784,940,544
Building 636,888,909 152,301,884 276,089,446 - 1,065,280,239 4 58,853,699 16,572,347 - 75,426,046 989,854,193
Furniture and fixtures 261,079,269 86,192,283 - - 347,271,552 10 42,729,316 25,033,403 - 67,762,719 279,508,833
Office Appliances 2,903,869 1,552,543 - (187,350) 4,269,062 20 1,630,062 353,744 (187,350) 1,796,456 2,472,606
Electrical Appliances 178,512,343 72,684,413 - - 251,196,756 20 52,135,375 32,252,654 - 84,388,029 166,808,727
Motor vehicles 1,479,933 40,000 - (10,000) 1,509,933 20 1,463,599 - - 1,463,599 46,334
2,737,301,889 663,446,839 1,053,916,708 (197,350) 4,454,468,086 156,812,051 74,212,148 (187,350) 230,836,849 4,223,631,237

Residence of executives:
Furniture and fixtures 1,645,290 400,000 - (150,000) 1,895,290 10 538,926 138,825 (61,584) 616,167 1,279,123
Electrical Appliances 10,483,694 1,800,000 - (1,175,000) 11,108,694 20 5,896,237 1,054,576 (740,261) 6,210,552 4,898,142
12,128,984 2,200,000 - (1,325,000) 13,003,984 6,435,163 1,193,401 (801,845) 6,826,719 6,177,265
2,749,430,873 665,646,839 1,053,916,708 (1,522,350) 4,467,472,070 163,247,214 75,405,549 (989,195) 237,663,568 4,229,808,502

Leased assets
Furniture and fixtures 106,051,227 - - - 106,051,227 10 36,471,014 6,958,021 - 43,429,035 62,622,192
Electrical Appliances 58,886,808 - - - 58,886,808 20 34,766,780 4,824,007 - 39,590,787 19,296,021
Motor vehicles 15,657,988 9,998,338 - (1,536,043) 24,120,283 20 9,984,589 3,807,916 (1,536,042) 12,256,463 11,863,820
180,596,023 9,998,338 - (1,536,043) 189,058,318 81,222,383 15,589,944 (1,536,042) 95,276,285 93,782,033
2,930,026,896 675,645,177 1,053,916,708 (3,058,393) 4,656,530,388 244,469,597 90,995,493 (2,525,237) 332,939,853 4,323,590,535

Annual Report - 20 10
Annexure-G

Annual Report - 20 10
Southeast Bank Limited and its subsidiary
Schedule of fixed assets including premises, furniture and fixtures as at 31 December 2010
"Tax demand as
"Accounting "Assessment "Tax provision per assessment "Tax Excess/(Short) Excess/(Short) "Status of assessment/
year" year" as per accounts" order" Tax paid provision paid pending with"
Taka Taka Taka Taka Taka

1996 1997-1998 3,257,419 12,238,230 12,238,230 (8,980,811) - Final


1997 1998-1999 28,000,000 41,534,700 34,012,284 (13,534,700) (7,522,416) Appeal to High Court
1998 1999-2000 41,305,000 72,691,434 42,494,020 (31,386,434) (30,197,414) Appeal to High Court
1999 2000-2001 85,000,000 75,685,833 75,685,833 9,314,167 - Final
2000 2001-2002 114,500,000 99,878,512 99,878,512 14,621,488 - Final
2001 2002-2003 131,492,000 168,819,477 168,819,477 (37,327,477) - Final
2002 2003-2004 181,986,000 225,452,928 225,452,928 (43,466,928) - Final
2003 2004-2005 299,337,000 258,021,090 258,021,090 41,315,910 - Final
2004 2005-2006 247,514,000 255,885,017 256,314,771 (8,371,017) 429,754 Final
2005 2006-2007 543,275,000 492,135,222 492,135,222 51,139,778 - Final
2006 2007-2008 714,000,000 882,994,743 882,994,743 (168,994,743) - Final
2007 2008-2009 1,354,633,782 1,217,328,007 1,217,328,007 137,305,775 - Final
2008 2009-2010 1,247,747,625 1,252,928,926 1,252,928,926 (5,181,301) - Final
2009 2010-2011 1,581,579,531 1,550,769,453 1,550,769,453 30,810,078 - Return filed with DCT

157
Southeast Bank Limited Annexure-H
'Names of Directors and their interest in different entities

Names of firms/companies in which


Sl. Status with interested as proprietor/director/managing % of
no. Name the Bank agent/guarantor/employee/partner, etc. Shareholdings
1. Mr. Alamgir Kabir, FCA Chairman Asia Insurance Limited 6.40%
National Life Insurance Co. Ltd. Nil
2. Mr. Ragib Ali Vice Chairman The Sylhet Tea Co. Limited 19.58%
Rajnagar Tea Co. Limited 41.67%
Union Syndicate Limited 19.00%
Star Tea Estate Limited 34.51%
3. Mr. M. A. Kashem Director Rose Corner (Pvt.) Limited 50.00%
4. Mr. Azim Uddin Ahmed Director Mutual Food Products Ltd 53.30%
Mutual Milk Products Ltd. 64.00%
AD Holdings Ltd. 50.50%
Mutual Trading Co. Limited 79.63%
5. Mr. Tahnoun A. Harun Director Incontrade Limited 0.13%
(representative of Portlink International Ltd. 16.66%
Bangla Capital Limited) Bangla Capital Limited 20.00%
Carlton Holdings Ltd. 5.00%
Agricultural Logistics Ltd. 90.00%
6. Mrs. Jusna Ara Kashem Director Rose Corner (Pvt.) Limited 20.00%
7. Mrs. Duluma Ahmed Director Mutual Food Products Ltd. 31.78%
Mutual Milk Products Ltd. 16.00%
Mutual Trading Co. Limited 12.96%
8. Mr. Syed Shahid Ali Director Nil
9. Mrs. Rehana Rahman Director Bengal Tradeways Limited 50.06%
Drip Packaging Limited 25.00%
10. Mr. Md. Akikur Rahman Director Nil
11. Mr. Monjur Miah Director Nil
12. Mrs. Sirat Monira Director Nil
13. Mr. Abdul Hye Director Nil
(representative of
Karnafuli Tea Co. Ltd.)
14. Dr. Zaidi Sattar Independent Director Nil
15. Mr. A. H. M. Moazzem Hossain Depositor Director International Publication Ltd. (Owning 1.33%
company of the Financial Express)

158 Annual Report - 20 10


Southeast Bank Limited Annexure-I

Islamic Banking Branches


Balance Sheet for the year ended 31 December 2010
2010 2009
Taka Taka
PROPERTY AND ASSETS
Cash:
Cash in hand (including foreign currencies) 60,094,165 21,959,473
Balance with Bangladesh Bank and its agent bank 432,454,026 704,476,534
(Including foreign currencies) 492,548,191 726,436,007

Balance with other banks and financial institutions


In Bangladesh 600,101,134 266,944
Outside Bangladesh - -
600,101,134 266,944

Placement with other banks and financial institutions - -

Investments in shares & Securities


Government 400,000,000 -
Others 1,450,313,250 -
1,850,313,250 -
Investments:
General investments etc. 5,625,792,557 4,762,187,745
Bills purchased and discounted 509,701,445 80,009,851
6,135,494,002 4,842,197,596
Fixed assets including premises, furniture and fixtures 29,746,355 20,631,728
Other assets 1,935,599,507 5,056,348,789
Non - banking assets - -
Total assets 11,043,802,439 10,645,881,064

LIABILITIES AND CAPITAL


Liabilities:
Placement from other banks, financial institutions and agents 600,000,000 -

Deposits and other Accounts :


Al-wadeeah current and other deposit accounts etc. 463,601,889 391,118,186
Bills payable 5,445,592 74,738,770
Mudaraba savings deposits 1,146,483,758 2,127,856,375
Mudaraba term deposits 8,321,431,297 7,713,826,673
9,936,962,536 10,307,540,004
Other liabilities 506,839,903 338,341,060
Total liabilities 11,043,802,439 10,645,881,064

OFF- BALANCE SHEET ITEMS

Contingent liabilities
Acceptances and endorsements 12,020,156,780 265,543,500
Letters of guarantee 6,034,183,466 382,550,910
Irrevocable letters of credit 15,013,644,393 330,984,539
Bills for collection 2,059,440,636 40,279,698
35,127,425,275 1,019,358,647
Other commitments: - -
Total Off-Balance Sheet items including contingent liabilities 35,127,425,275 1,019,358,647

Annual Report - 20 10 159


Southeast Bank Limited Annexure-I.1

Islamic Banking Branches


Profit and Loss Account for the year ended 31 December 2010
2010 2009
Taka Taka

Investment income 1,128,761,463 1,025,674,179


Profit paid on deposits, borrowings etc. (725,968,399) (686,847,168)
Net investment income 402,793,064 338,827,011

Commission, exchange and brokerage 49,653,907 39,035,259


Other operating income 6,397,613 13,626,908
Total operating income 458,844,584 391,489,178

Salaries and allowances 46,786,488 35,445,111


Rent, taxes, insurance, electricity etc. 18,340,235 21,172,265
Legal expenses 10,750 23,050
Postage, stamp, telecommunication etc. 4,300,205 3,692,659
Stationery, printing, advertisement etc. 2,909,953 2,429,404
Depreciation and repair of Bank's assets 6,190,646 4,850,161
Other expenses 15,292,705 12,382,116
Total operating expenses 93,830,982 79,994,766
Profit /(loss) before provision 365,013,602 311,494,412

Provision for investments


General provision 600,000 65,148,818
Specific provision 775,000 -
1,375,000 65,148,818
Provision for off-balance sheet items 6,190,896 10,193,500
Provision for diminution in value of investments 28,200,000 -
Total provision 35,765,896 75,342,318
Total profit/(loss) before taxes 329,247,706 236,152,094

160 Annual Report - 20 10


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Southeast Bank Limited
A B a n k W i t h Vi s i o n
52-53, Dilkusha Commercial Area, Dhaka-1000, Bangladesh
Phone: 9571115, 7160866, 9555466, 7173793, 9550081
Fax: 9550086, 9550093, 9563102, SWIFT: SEBDBDDHXXX
http://webmail:southeastbank.com.bd/owa, E-mail: info@southeasbank.com.bd