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1.1 Introduction

In Bangladesh economy banking system plays a significant role. In recent time banking
institutions are essential in modern society. The modern economic functions become
meaningless and sluggish without banks. Moreover, for the development of a country
financial institutions are highly required. For instants, generating employment,
encouragement to the entrepreneurs, promotion of capital and many more things are
involvement of banks. In today’s world bank become so important that become leading
financial intermediary. Banks act as a financial intermediary to mobilize fund from the
surplus to deficit economic units.

From the early nineties different initiatives have been taken to increase the competition
and efficacy of money market, relaxation of unwanted rules and regulation, modification
in terms of laws of loan so that the base of the banking system can be established in
Bangladesh in such a way that might uphold the economic condition of the country. In
recent times in the western countries we can see that the banking system has been
undergoing for several factors like deregulation, technological innovation and
globalization. Hence unfortunately Bangladesh is not progressing accordingly. After the
emergence of Bangladesh, there seems a significant change in the drastic change in the
field of banking progress in the age of globalization. Here the banking sector has
expanded a lot of things in the last three decades. Though many private commercial
banks have been established the major portion of banking business is covered by the
four Nationalized Commercial Banks, such as Sonali, Rupali, Agrani and Janata Bank
Limited. Aftar the central bank of Bangladesh, Bangladesh Bank, Janata bank in treated
the most important government financial institution in terms of banking facilities. Among
all the financial banks under government supervision Janata bank has the largest
amount of branches all over Bangladesh. For that reason it is really very much
convenient for its consumers to reach Janata bank and deal with their valuable financial
activities with the institution. Overall we can say that Janata bank is playing a significant
role to improve the socio- economic condition of Bangladesh. (Saha, 2009)

Nationalization of Banks in Bangladesh: After the liberation war in 1971,

Bangladesh government decided to unite the bank authority and accept the socialist
pattern to fulfil society’s goal. On 26 march the following year Bangladesh government
adopts to nationalize all the banks as an implementation stated earlier. In light of that,
there are several bank merged into one which we know today. For example, previously
known united bank ltd and Union bank combined into Janata Bank Ltd. Some are just
renamed like Eastern Banking Corporation and Eastern mercantile bank ltd are now
Uttara bank and Pubali bank respectively.

Among stated owned giants, Janata Bank is one of the largest commercial bank in
Bangladesh. By the Presidency Order of 1972, this bank was established under
Bangladesh Bank and got nationalization. Merging United Bank Limited and Union Bank
Limited, were two private banks performing class banking over the country. On 16th
December 1971, after the birth of Bangladesh, newly formed Janata Bank banking got
special facilities from the government for mass to work as nationalized commercial bank
all over the country. With the increase of responsibility and by quality of performance
within a few years, it becomes one of the largest commercial bank of Bangladesh with
898 branches in which 4 overseas branches are at UAE. This bank is connected with
1239 foreign correspondents globally. Total employees of Janata Bank Limited are

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approximately fourteen thousands currently. Janata Bhaban, the head office is located at
Motijheel commercial area in Dhaka city. [source: http://jb.com.bd/jb/about_us/history]

JANATA Bank Limited welcomes you to explore the world of progressive Banking in
Bangladesh. It is a state owned commercial bank and is catering the need of the mass
business people. It was corporatized on 15th November 2007. Janata Bank was born
with a new concept of purposeful banking sub serving the growing and diversified
financial needs of planned economic development of the country.

Our commitment and the people’s belief in us have given us the edge over others to
earn this trust about the safe keeping of their money in the right kind of banking
channel.

1.2 Origin of the Report

The prime objectives of this report are to fulfill the partial requirement for the degree of
BBA. Since, it’s compulsory for all students of BBA program of Business faculty, Islamic
University Kushtia to undergo three months long internship program to explore real life
business situation.

Janata Bank Limited is a place where I could learn the business dealings. This
organization has created a positive image to the customer mind by providing better
service. This Bank has introduced some Modern deposit Schemes that has high market
demand. As it maintain the pace with the competitive business world, its activities,
culture, philosophy and style leads an intern student to be the best at any field of
working life. With this view, during my internship I was assigned to …… branch, Janata
Bank Ltd, with other activities I specially tried to observe the Investment banking
procedure and function of this branch.

1.3 Background

The internship program is full credit subject of the BBA program of the Islamic University
Kustia which constructs a relation between the real life state of affairs and theoretical
concepts.

I am a student of Bachelor of Business Administration of BBA program prefers to prepare

a report on banking sector rather than other financial institution. I am assigned an
internship report by the Janata Bank Ltd dated January 10, 2015. This internship report
is a part of my BBA program that performed by me as students of Islamic University
Kustia of Finance & Banking Studies. In a formal way, I select the banking sector and my
supervisor offered me prepare the report on title as Investment Mechanism of
Janata Bank Ltd ( A study on Mog Bazar Corporate Branch.)

Investment is done under different modes of investment and before investment some
objective and principles are to follow. Investment practice consists of some stage
Selection of the client, Application stage, Processing and appraisal, Sanctioning stage,
Documentation stage, Disbursement stage, Monitoring & Recovery stage

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1.4 Objectives of the Study:

Primary Objectives:

The primary objective of writing the report is fulfilling the partial requirements of the
BBA program. In this report, I’ve attempted to give an overview of Investment
Mechanism of Janata Bank Limited. Also in the major part of the report is Investment
Mechanism.

Secondary Objectives:
 To present an overview on Investment Mechanism of Janata Bank Ltd.
 To present the current situation of Kalatia branch.
 To observe the economic condition of AIBL
 To explain the general banking activities of AIBL.
 To suggest some possible recommendations to overcome the problems.
 To suggest a supportive role in the progress of banking system in financial
sector

1.5 Methodology

To complete this report I’ve followed a systematic study which include working,
inspecting and talking to the executives at different levels of the organization to know
the present scenario of the banking practice. To facilitate make the report more
meaningful and presentable two sources of data and information have been used widely-

The primary sources which are as follows:

 Head to head conversation with the Executives and officers of Bank.

 Unceremonious conversation with the client.
 Realistic work exposures from the different desks of the various departments of
the Branch covered.
 Relevant file study as provided by the officer’s concerned.

The Secondary Sources of data and information are as follows:

 Annual Report of Janata Bank Ltd.

 Periodicals published by Bangladesh Bank, various books, articles, compilations
etc, regarding general banking functions.
 AIBL’s website
 Internet and Study of selected reports

1.6 Scope of the Study

This report has been prepared on the basis of experience gathered during the period of
internship. This report will be dealing with the overview of Janata Bank Ltd. & mainly
with Investment Mechanism of this Bank. But the report will try to cover overview of
Janata Bank’s objectives, functions, management, business policy and other activities.

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This report will also mention some problems of Janata Bank’s Operating systems and its
solutions.

1.7 Limitations

There were some problems while I have undergone the internship program. A
wholehearted effort was applied to conduct the internship program and to bring a
reliable and fruitful result. In spite of having the wholehearted effort, there exits some
limitations, which acted as barrier. The following limitations are apparent in the report:

 Access to data regarding different performance indicators of Janata bank Ltd.

 The report is mainly based on the secondary data which published by different
organization as annually, half-yearly, monthly, weekly and daily.
 Time constraints are additional limitations of this report.
 Getting relevant papers and documents may be strictly prohibited for an intern
 Due to some legal obligation and business secrecy banks are reluctant to provide
data. For this reason, the study limits only on the available published data and
certain degree of informal interview.
 The bankers are very busy with their jobs which lead a little time to consult with.
 Finally, some recent data which were needed to enrich this report but the
unwillingness of the executives of the bank due to confidentiality was made my
report limited to data content.

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2.0 Janata Bank Limited

2.1 Background

With the emergence of Bangladesh as an independent, sovereign state in 1971 after a

devastating nine month war against the West Pakistani occupation army, a war, full of
blood and tears, trauma and pain of millions of our beloved ones, the legacy of
rebuilding the already broken financial base of the country was felt as an urgent call of
the day against a collapsed economic reality of a newly born state.

In this backdrop, in order to rebuild the country’s economy, measures had been taken to
merge a number of banks previously operated in this region and make new banks and
this initiatives led to formation of Janata Bank in 1972 by combining the erstwhile United
Bank Limited and Union Bank Limited under the Banks Nationalization Order (President’s
Order No. 26) of 1972.

In 15 November, 2007 Janata Bank got registered with the Joint Stock of Registrars and
restructured it as a public limited company with the name Janata Bank Limited.

Including 4 overseas branches in United Arab Emirates Janata Bank runs its business
with 911 branches across the country having a big family of around 12,939 (As on
31.03.2017) employees with its head office located at Janata Bhaban at Motijheel C/A,
the heart of the capital city, Dhaka.

At the end of 2016 the Bank held Deposit BDT 641,819.15 million, Advance BDT
403,037.41 million with Authorized capital BDT 30,000 million and Paid-up Capital BDT
19,140 million.

Janata Bank Limited, a corporate body trusted over the years, the 2nd largest (in respect
of Deposits/Assets) commercial bank in Bangladesh, has been playing pivotal role in
overall financial activities of the country and is possessing a long heritage of discharging
laudable services to the society since her embankment immediately after the emergence
of this verdant rich alluvial soil as a sovereign, independent state.

The contribution of the Bank to the national economy and social reform has set standard
bar so high that others in this business can’t help aspire touching the benchmark of
success earned by JBL. More so a matter of great honour is that the contribution,
commitment and success of the Bank have been recognized with a number of
prestigious awards by national and international organizations of repute.

Since inception, as a State-owned Commercial Bank (SOCB), Janata Bank Limited (JBL)
is directly and indirectly contributing to achieve socio-economic development of the
country as a trusted partner in progress. Apart from being an effective contributor to
building the nation, JBL is engaged in various profitable financial activities for inclusive,
eco-friendly and sustainable growth and is committed to various welfare activities on
social responsibility point of view.

In 2015, the banking business went through challenging operating conditions, increased
competition and slow growth in investment sectors. In spite of all, JBL has achieved a

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strong and sustainable growth by securing notable progress in important economic
indicators along with retaining the top position among SOCBs. Mainly, it has become
possible due to the timely guidance and direction, prudent and profitable decisions and
close supervision of the Board of Directors, right leadership of the management and
tireless work of all employees.

2.2 Vision

To become the effective largest commercial bank in Bangladesh to support socio-

economic development of the country and to be a leading bank in South Asia.

2.3 Mission

Janata Bank Limited will be an effective commercial bank by maintaining a stable growth
strategy, delivering high quality financial products, providing excellent customer service
through an experienced management team and ensuring good corporate governance in
every step of banking network

2.4 Strategic Objectives of JBL

We have Our strengths

 Concern
 Commitment
 Competence
We need
 Maintain strong capital
 Sense of belonging (ownership)
 Team spirit
 Human touch with clients
 Managerial efficiency
 Innovative thinking
 Free from corruption
 Improve on-line banking
 Improvement of IT infrastructure
 Nationwide networks, 904 branches
 Foreign Network 4 branches
 Foreign Correspondence 1251
 Increase of inward remittance
 State owned image
 Market reputation
 Global recognition
 Strong deposit base
 Strong capital base
 No provision shortfall
 Skilled manpower
 Experienced management
 Newly recruited talents
 JBL-Friendly board of directors
 Running adequate liquidity

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 Introduction of mobile banking
 Broadening of deposit base
 Expedite cash recovery
 Making all branch profitable
 Improved training program
 Boost up foreign remittance
 Ensure chain of command and Discipline
 Correct estimation of borrowers demand
 Proper valuation of security
 Customers preference
 Synthesis of mass banking and elite banking
 Avoid loan sanctioning bureaucracy
 Aware gender sensitivity
 Aesthetic branch infrastructure.
 Service mind set

Our brand Core Values

 IT based delivery channels  Professionalism
 Easy access to customers  Growth
 Quality and responsive staff  Diversity
 Service with competitive cost  Dignity
 Business diversification  Accountability
 Professionalism  Integrity
 No hidden cost
 Positive impact of CSR
 Consecutive good performance

2.5 Code of Conduct

In accordance with the ethical principles, the code of conduct of JBL employees shall:

 Act with integrity, competence and dignity;

 Loyal to the bank and bank’s interest;
 Maintain professionalism and ethical standards;
 Deliver professional service in accordance with JBL policies and relevant standards;
 Try to fulfill the customer needs in the best possible manner within the guideline of
corporate ethics;
 Keep all matters confidentially;
 Maintain knowledge of and comply with all applicable laws, rules and regulations;
 Never offered or accept illegal gifts or other facilities in order to achieve personal
advantage;
 No discrimination against any person on the basis of race, religion, color, gender,
age, etc.
 Not engaged in any unprofessional conduct involving dishonesty, fraud,
misrepresentation or commit any act that reflects adversely on honesty,
trustworthiness and professional competence.

2.6 Ethical Principles

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Bank deals with public money where ethical compliance is very important. Janata Bank
maintains its reputation as a law-abiding organization and a good corporate body.
Employees are properly guided to conduct business in compliant manner. The policy and
procedures regarding Janata Bank’s business process are prepared in adherence to the
laws and regulations. JBL follows and maintain ethical principles in every sphere of its
banking operation and customer services. The main features of employee’s code of
ethics and business conducts are as follows:

 Implement justice and fairness;

 Ensure optimal customer services;
 Maintain privacy and secrecy of customer’s information; but at the same time it
complies with ‘The Right to information Act-2009’;
 Prevent money laundering and corruption;
 Protects and upholds corporate values;
 Maintain accuracy and transparency in financial reporting;
 Protect natural environment.
 Perform all the activities according to the guidelines and laws approved by the
various regulatory authorities.

2.7 Corporate Profile

Name of Company : Janata Bank Limited

Registered Office : Janata Bhaban
110, Motijheel C/A Dhaka-1000
Legal Status : Public Limited Company
Date of Incorporation : 21 May 2007
Date of Commencement of Business: 31 May 2007
Authorized Capital : Tk. 30,000 Million
Paid up Capital : Tk. 19,140 Million
Face value per share : Tk. 100 per share
Shareholding Pattern : 100% Share owned by the Government of
the Peoples Republic of Bangladesh
Tax Identification No. : 001-200-2732
Vat Registration No. : 9011050160
Chairman : Shaikh Md. Wahid-uz-Zaman
CEO & Managing Director : Mr. Md. Abdus Salam, FCA
Chief Risk Management Officer: Mr. Hasan Iqbal (DMD)
Chief Financial officer (CFO) : Mr. Md. Nurul Alam, FCA, FCMA (GM)
Company Secretary : Mr. Md. Mosaddake-Ul-Alam (GM)
Total Number of Branches: 911
Domestic Network
Number of Branch : 911
Number of Divisional office : 11
Number of Area Office : 50
Number of AD Branch : 56
Overseas Network

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Number of Branch : 04
Location : Abudhabi, Dubai, Al-Ain & Sarjah. UAE
Subsidiaries
Janata Capital and Investment Ltd : Dhaka.
Janata Exchange Company srl. : Italy
Janata Exchange Company Inc. : New York, USA
Number of Correspondence : 1251
Number of Employees : 14151
Number of Exchange House : 76
Corporate Rating Status
Entity Rating : A + in the long run
: ECRL-2 in the short run
As govt. owned Bank : AAA in the long run
: ECRL-1 in the short run
E-mail : md@janatabank-bd.com
Website : www.janatabank-bd.com; jb.com.bd
Swift Code : JANBBDDH

2.8 Key Milestones Year By Year

2015
 JBL crossed BDT 550,000 million in deposit.
 JBL crossed BDT 349,800 million in loans & advances.
 JBL Rewarded “Wholesale Banking Awards 2015” &“Retail Banking Awards 2015”.

2014
 Received “ICAB Best Presented Annual Report Award” (1st position) from The
Institute of
 Chartered Accountants of Bangladesh (ICAB)
 Received “ICAB Corporate Governance Award” from The Institute of Chartered
Accountants of Bangladesh (ICAB).
 Received SAARC anniversary award for corporate governance from The South
Asian Federation of Accountants (SAFA)
 Received “ICMAB Best Corporate Award” (1st position) from Institute of Cost and
Management
 Accountants of Bangladesh (ICMAB).
 Received “Asian Banking and Finance Awards 2014” from The Asian Banking and
Finance Magazine (ABF) .
 Incorporation of Janata Exchange Company, USA.
 JBL crossed 900 Branches all over the country.

2013
 Full automation of JBL branches.
 JBL Received “Performance Excellence Award” from Citi Bank N.A.
 Inauguration of online deposit, payment & remittance system.
 Enhancement of paid up capital to BDT 19,140 million

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  Issuance of highest right share in JBL history.

2012- 2013
 JBL Rewarded “Wholesale Banking Awards” &“Retail Banking Awards”&“Bank of
the year Award” by Asian Banking and Finance (CMG) Singapore.

2012
 JBL at the top in CSR activities among the SCBs.
 Landmark of BDT 400,000 million deposit.

2011-2013
 JBL achieved highest operating profit among SCBs.

2011
 Launching of JBL CIB online system.
 Launching BEFTN & EFT operation.
 Inauguration of online banking.
 Landmark of BDT 100,000 million of foreign remittance.

2011-2012
 Received “ICMAB Best Corporate Award” from Institute of Cost and Management
Accountantst of Bangladesh (ICMAB).

2010
 Incorporation & commencement of Janata Capital & Investment Ltd.
 Launching of BACH operation.

2009
 Launching of speedy remittance service.
 Issuance of 1st bonus share in JBL

2008 Commencement of NRB branch.

2007 Incorporation and commencement of business as JBL

2006-2009
 Received “World Best Bank Award” from New York based financial magazine
global finance.

2005
 Received “Asian Banking Awards” on credit scheme for handicapped people from
Asian Bankers
 Association (ABA) & Bank Marketing Association of the Philippines (BMAP)

2004
 Received “Asian Banking Award” on Financing program for Women
Entrepreneurship from
 Asian Bankers Association (ABA) & Bank Marketing Association of the Philippines
(BMAP)

2003 JBL crossed BDT 100,000 million of loans & advances.

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2002 Incorporate of ATM service.

2001- 2005
 JBL awarded “The bank of the year in Bangladesh” by London based financial
times group.

2000 Deposit crossed BDT 100,000 million.

1999 1st cash dividend paid.

1990 Launching 1st computer in JBL.

1976 Inaugurate 1st overseas branch in UAE

1972 Commencement of banking operation

2.9 Performance of JBL in 2015

In 2015, JBL aimed to versatile deposit mix through increasing low-interest deposit
schemes, bring down the rate of classified loan to single digit and ensuring sustainable
growth through increasing assets quality. JBL wanted to ensure desired-level
productivity through human resource development, strengthen risk management
activities, practice good governance and ensure overall better customer service. Besides,
JBL aimed at fulfilling the targets of the KPI set by the Performance Contract Agreement
signed for the first time with Bank and Financial Institution Division, MoF. From the
mentioned targets, JBL has secured BDT 1072.05 crore as operating profit and other
significant achievements in different economic indicators. Especially, the Bank has more
than 100 percent achievement in 10 out of 13 indicators of KPI mentioned in the
Performance Contract Agreement. Also, JBL has secured 1st position among SOCBs in
terms of KPI performance valuation. At a glance, some of JBL’s mentionable
achievements of 2015 as follow:

 BDT 1072.05 crore as operating profit in 2015, which is the highest among
SOCBs.
 In 2015, after tax profit increased by 21.15 percent and reached to BDT 480.78
crore, which is the highest among all public-private banks.
 Total assets increased by 8.78 percent and reached to BDT 68,315.75crore.
 Deposit increased by 10.36 percent and reached to BDT 56,891.11 crore.
 Loans and advances increased by 9.41 percent and reached to BDT 34,986.13
crore.
 Rate of classified loans is 12.34 percent, which is the lowest among SOCBs.
 Bank’s capital adequacy rate is 10.16 percent as on 31 December, 2015.

Comparative Financial Highlights of JBL

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2.10 Human Resources Management

Skilled human resources is the key to run the financial institutions like bank. For this,
sustainable planning is required for the proper development of this resource. JBL is
trying to properly develop and build up capacity of its human resources by conducting
various kinds of training programs around the year. Adequate budget is allocated every
year, as we consider that there is no alternative to increasing capacity of employees to
ripe desired benefits by delivering expected-level banking service to the constantly
changing customers’ expectation under competitive banking system. Thus, JBL is

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consecutively arranging various training programs at home and in abroad every year for
enhancing and enriching employees’ banking and technology-related knowledge base.

Organogram of Janata Bank Limited: The whole structure of the Janata Bank
Limited is very important for understanding the operations of the Janata Bank Limited.
There is divisional office, regional office and large number of branch offices of the Janata
Bank Limited. All the offices are coordinated by the Head office of the Janata Bank
Limited.

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Page | 15
2.11 Automation

There is no alternative to the use of technology to build Digital Bangladesh. Taking this
as an inspiration, in a bid to cope with the timely demands, JBL has always put emphasis
on bringing the latest technology. As part of the initiatives, the Bank launches online
banking activities through an excellent technology and globally recognized software
called Temonus-24 (T-24) to meet the increasing customer demand. JBL has broadened
its horizon of financial service by bringing 503 out of 908 branches under online service.
It has planned to bring the rest of the branches under online service by June, 2016. It
can be specially mentioned here that, apart from bringing branches under online,
through in-house developed software called “JB Remittance”, customers can deposit and
withdraw money from one branch to another branch within a very short moment. So, it
can be said that own developed information technology software eases the banking
activities at the same time, ensures better customer services. Overall, bank staff and
customers both are getting special benefits and facilities due to availability of advanced
network and communication system.

2.12 Corporate Governance

The development of an institute depends on the best practice of corporate governance.

Although there is lack of corporate governance practice in the state-run corporate
offices, however, JBL is trying to establish transparency and accountability in day-to-day
banking operation, which are the essentials of good governance. For this, as per the
guideline of Central Bank, Audit Committee, Executive Committee and Risk Management
Committee are working alongside, internal control and compliance system of the Bank
has been strengthened. Besides, ‘Complaint Box’ and ‘Help Box’ are being operated from
the Head Office to all branches, through this, valuable customers are provided with
feedbacks of their queries, their complaints are addressed and appropriate preventive
measures are being taken.

2.13 Implementation of Government Development Programs

In light of its policies, JBL has been adding values to national economy by financing
various trade and commercial activities. Besides, JBL is playing an important role in the
country’s overall development through supporting and collaborating with in the different
socio-economic development programs of the country. Loans are provided by JBL to the
educated and uneducated youths in setting up SMEs and income generating activities in
a bid to create employments. As per directives of the Government, loans are provided to
fishery and dairy sectors with a view to meeting protein and nutrition demands.
Specially, in a bid to bring the women, who account for half of the population, in the
mainstream of economy, the Bank has been successfully conducting women
entrepreneurship loan programs. Overall, JBL is persistently working in various
government initiated social safety net programs.

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2.14 Corporate Social Responsibility (CSR)

In a bid to accelerate the sustainable development, it is very much essential to conduct

different social responsibility activities. Under the guideline of Bangladesh Bank, JBL has
been conducting the CSR programme. As a State-owned Bank, since inception JBL is
conducting different activities on social responsibility ground, but it formally began CSR
programme in 2009. JBL distributed BDT 71.28 crore in various sectors as donation till
2015. Education and research, health and medical treatment, poverty alleviation, history
of Liberation War and cultural practice and preservation, rehabilitation and protection of
the environment are special mentions in CSR donation. Moreover, winter cloth
distribution among the cold-hit people, sewing machine, television distribution among
the ex-enclave people and providing interest free loan to the farmers of monga-stricken
areas have added different dimension to JBL’s CSR activities. Overall, as per direction of
the Government and on social responsibility point of view, JBL has been conducting
various types of activities including social safety net programmes which are part of CSR
activities.

2.15 Branding

Janata Bank is a household name in the banking sector. Not only this, JBL has already
secured top position among SOCBs in terms of continuous, successful performance. Also,
it is the highest profit earner in overall banking sector. Besides, JBL has recently placed
itself in different heights by providing rural credit, poverty eradication, SME and
financing heavy industries along with donation to CSR. In this context, with a view to
transforming JBL into a branding institution, we have begun massive publicity including
preparing a brand identity manual. As part of the initiative, primarily some branches
have been selected to decorate in a unique design. According to the brand identity
manual, initiatives have been taken to bring similarity in all banking operations at every
level of banking activities. Sponsoring sports and cultural events to promote Bank’s
publicity, arranging rallies on different national occasions and participating in city
beautification like initiatives have been taken. Moreover, new digital displays have been
set up at the Head Office building and Local Office building and many other branches in
a bid to present Janata Bank in new way, and through this way, various products and
services of JBL are being massively advertised for public attention. It is expected that,
with the support and cooperation of concerned all, JBL will very soon emerge as a
‘Brand’ in the banking sector.

2.16 Future Challenges and Our Initiatives

It is the reality that we will have to face many challenges in the upcoming days. But I
firmly believe that by means of innovative ideas and combined efforts, we will be able to
reach our expected goals by overcoming all the challenges. I have full confidence on the
management and all employees. I am hopefull that, the success of JBL will be continued
in future through of the guidance of the Board of Directors, skilled leadership the
management and the dedicated efforts of the employees to achieve the goals of Vision-

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2021, a universalize development plan of the Government of Bangabandhu daughter
Honorable Prime Minister Sheikh Hasina. To continue the success in 2016, we have
already taken some short-term and mid-term plans as mentioned below;

 Initiating online banking facilities at all branches within year 2016 to ensure time-
demanding, modern banking service;
 Increasing credit flow to low risk and prospective SME sector in a bid to reduce credit
risks;
 Modernizing human resources management to create banking knowledge equipped
and modern technology-friendly human resources;
 Taking appropriate steps to make a time- bound action plan aimed at collecting huge
amount of written-off loans;
 Taking steps to vacate the writs filed against the top loan defaulters with the High
Court to recover money from them and taking other legal steps against them;
 Taking steps to make risk management system more appropriate and realistic;
 Upgrading all the branches’ decoration and providing required logistic support;
 Strengthening internal control and compliance system at all levels of the Bank;
 Ensuring technology and cyber security and overall security.

2.17 Capital Adequacy

Janata Bank is committed to building a strong, business expansion-friendly capital

structure. To implement the plans, JBL is always serious to follow the internationally
recognized all policies and rules. In 2013 and 2014, the Bank’s capital adequacy were
10.16 percent and 10.30 percent respectively, showing surplus capital. Due to
restructuring of huge amount of loans in 2015, the Bank had to lose huge interest
income. Because of more provision kept against the loan restructuring, like the previous
continuing trend, the Bank’s capital adequacy rate did not increase as on December 31,
2015, the Bank had capital adequacy of 10.27 percent which is more than required 10
percent. The Bank is always conscious about the capital. JBL is conducting various
effective efforts to ensure implementation of BASEL–III in a bid to develop various
elements of capital including increasing required capital. Because, a stronger capital will
create a greater chance of business expansion and strengthen the financial foundation of
the Bank.

2.18 Assets and Liability Management

The activities of the Bank centered around achieving the targets of selected indicators.
For this, invest the excess liquidity into high profit-yielding sectors and more emphasize
is given on Retail and SME finance for increasing high-value assets. Besides, as a part of
asset diversification, steps have been taken to increase credit flow to low-risk corporate
sectors. On the other hand, interest-free and low-interest deposit collection has been
prioritized aimed at rationalizing the cost of fund. Specially, steps have been taken to
increase security measures of Treasury Department and strengthen it in a bid to make
fund management more effective.

2.19 Risk Management

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Risk is built-in element of business but is an integrated part for financial businesses like
the banks. Mainly, invested capital and investment environment is gradually becoming
risky due to multi-faced challenges arises from totally globalized trade and commerce
and regional and political instability. Under the circumstances, along with taking
measures to mitigate all possible risks in our own ways, in the light of Bangladesh Bank
guidelines, we have formed and restructured different risk-related committees and
followed more cautious steps at all levels of operational activities. At present, Risk
Management Department, along with Board supervised Risk Management Committee for
over-all risk management, Management Committee for management level risk
management, two separate departments namely, Foreign Trade Monitoring Department
and Foreign Trade Audit Department have been formed for foreign exchange risk
management. The departments and committees are working sincerely to find out risks in
daily banking activities and giving solutions to reduce risks and continuously working to
prevent possible future risks. They also give their reports regularly to the Board of
Directors.

2.20 Green Banking

This is an undenying fact that, banking business is getting involved in carbon emission,
actively or passively. Considering the adverse effects of carbon emission and in the light
of JBL’s own ethical ground, JBL is playing a responsible role in reducing the carbon
emission generated from the banking activities. For this, a unit called “Green Banking”
has been opened under Risk Management Department. The main objective of the unit is
to engage its best efforts for Green Banking or Green Financing. In the meantime, JBL’s
Green Bank Communication Program has progressed much further. Besides, more
emphasis is being given to setup solar panels at branches, make the branches more
greenery and the preservation of eco-system issue while financing to commercial
projects. Overall, proper measures are being taken to increase awareness among the
staff about the Greenhouse effects and negative impacts of climate change.

2.21 Security system

It is a prerequisite to ensure security of customers’ deposit in bid to build their

confidence. In addion, proper security arrangement helps staff increase their bravery
and morale to provide better customer service. Due to some recent, unexpected
incidents, security system of the Bank is re-arranged and strengthened at every level
under the supervision of the Chief Security Officer by co-ordinating trained Ansar
members, security guards and security staffs. CC cameras have been set up inside the
strong-rooms, in front of the main gates of branches and inside the branches. Besides
setting up archway and CC cameras in front of the Head office and other main offices
and branches, there is a restriction for unknown persons to enter the offices and
branches. Such steps will be taken at all branches gradually in a bid to ensure security.

2.23 Financial inclusion

The main objective of financial inclusion is to build-up a Banking nation by providing low-
cost banking services to the unbanked, backward and limited income people. As a SOCB,

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JBL is providing this service for a long time by practicing mass banking. Bangladesh
Bank’s encouragement and enthusiasm has added different dimensions for expanding of
financial inclusive banking. Marginal farmers, cleaners, street children, social safety
beneficiaries and students have opened 26,14,736 accounts with JBL. Here, besides
personal saving opportunity, account holders are enjoying multiple banking facilities.

3.0 Investment Mechanism of JBL

3.1 Loan and Advances Products of JBL

Janata Bank Limited has been providing loans in vast numbers of areas. It has different
type of loans to meet different type of needs of customers around the country. List of
Loans and advances products provided by JBL are:

Term Loan Rural & Agro Credit

• Industrial Credit (IC) • Crop Loan
• Housing Building Loan (General & • Fishery Loan
Commercial) • Animal Husbandry Loan
• Agro based Industry/Project Loan • Agricultural Machineries Loan
• Ship building • Rural Transport Loan
• Loan for Overseas Employment • Flower Cultivation
• Consumer Credit

Continuous Loan Small and Medium Enterprise Loan

• Cash Credit (Hypo) • Manufacturing Sector Loan
• Cash Credit (Pledge) • Trading Sector Loan
• Export Cash Credit (ECC) • Service Sector Loan
• Secured Overdraft (SOD)

Poverty Alleviation Program Specialized Loan Program

• Supervised Credit Program
• Small Farmers & Landless Laborers
• Self-employment Scheme
• Ghoroa Prokalpa/Family Based Micro
Credit
• Cyber Café
• Service holders Loan
• Doctor's Loan Scheme
• Special Credit Program for Women
Entrepreneurs

Import & Export Finance Letter of Credit

• Loan Against Imported Merchandise
(LIM)
• Inland Bill Purchase (IBP)
• Loan Against Trust Receipt (LTR)
• Payment Against Document (PAD)
• Packing Credit (PC)
• Local/Foreign Bills Purchased (FBP)
• Loan Against Export Development Fund
(EDF)
• Advance Against Cash Subsidy,
• Letter of Credit - at Sight
• Letter of Credit – Usance
• Back to Back L/C
Letter of Guarantee
• Advance Payment Guarantee
• Bid Bond
• Performance Guarantee
• Shipping Guarantee

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Assistance

Micro & Cottage industries loan Other Credit Program

• Dairy/Poultry/Fish Culture • Transport
• Loan for Handicrafts/Disabled People • Loan to Diagnostic Centers
• NGO linkage loan • Loan to Travel Agencies
• Weavers’ Credit • Loan for Salt Production
• Swanirvar Loan

3.1.1 Agriculture Loans

Description of Loanable fields Interest
Rate
All types of crops / crops, sugarcane cultivation (mills area), fishery 10%-10%
and shrimp cultivation, purchase of fresh cow / buffalo and animal
husbandry, poultry, banana cultivation, drinking banana.
Shrimp Cultivation Loan 10%-10%
1. All irrigation equipment, agricultural machinery 4% - 10%
2. Salt production
Pulses, spices, oil seeds and corn 4%-4%
Poverty Reduction 10%-10%
1. Multi-purpose Loan (According RCD Circular No. 215)
2. SFDP
3. Self-Dependent Loans
4. Self-Employment Project for Trained but Unemployed Youth
5. Self-Employment Project for Educated Youth
6. Self-Employment Project
7. NGO Linkage (Loans which are approved by Boards)
8. NGO Linkage (Loans Approved by MD and subordinate)
9. Family-based Micro-loans (Agri)
10. Family-based Loans (Non-Agri)
11. Others Personal or Group-based Micro-credits
12. MSFSCIP

Specialized Loan Program 8%-10%

1. Crop Warehouse Loan Scheme,
2. Flower cultivation and marketing loans,
3. BGSDP,
4. Goat-keeping loan program,
5. The nursery loan of forestry herbal plants,
6. Promising breed of cows,
7. Loans between entrepreneurs / fisheries selected by Fisheries
Department,
8. Loans for the disabled,
9. ADEP (Agriculture Based Industrial and Technology
Undertaking Project),
10. Floating cage fish farming loan program,
11. Special loan program in poverty-stricken areas (poverty-

Page | 21
 stricken area should be marked)
Rural credit 10%-10%
1. Poly transport, 2. Land mortgage loan, 3 Rural Women
Employment Loan

3.1.2 Term Loan for Large and Medium Industries

Description of Loanable fields Interest Rate

Dairy, poultry, fish, hatchery etc. (Above 3 Crore) 13%-13%
Term loan / project loans in agro-based industries: 13%-13%
Total 34 fields (Appendix – 1)
Term / project loan in priority sector: 13%-13%
Total 13 fields (Appendix – 1)
Terminal / project loan in export-oriented industries: 13%-13%
Total 8 fields (Appendix – 1)
Freezer for Potatoes Preservation 13%-13%
Term loan in other large and medium industries 13%-13%
Loan to favor leasing company 13%-13%

3.13 Working Capital Loan

Agro-based Industries / Projects 13%-13%

Working capital loan of Husking Mill 13%-13%
Potatoes Preservation for Potatoes 13%-13%
Other Working Capital Loan 13%-13%
Working capital loan in jute industry 13%-13%

3.1.4 Import Loans

PAD (Cash) 13%-13%
1. For the importation of rice, wheat, edible oil (refined and
unrefined), pulses, poultry, onion, date and sugar imported
loans.
2. In the case of imported chemicals as agricultural inputs,
chemical fertilizers
3. In all other cases.
LIM (Fields - As Above) 13%-13%
LTR (Fields - As Above) 13%-13%
All Types of demand loans including import credit 13%-13%

3.1.5 Export Loans

Packing Credit: 7%-7%
1. In favor of exporters against RR / SR / BR / TR.
1. Contrary to the receipt of the C & F agent's receipt
ECC (Hypo/Pledge) 7%-7%
The current capital for the export of readymade garments, frozen

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food and agricultural products based on agricultural products,
leather and leather products. Note: Contracts will be adjusted within
120 days from the date of delivery of the delivery of the ECC
liabilities distributed against the export order. Normal loan interest
rates will be applicable for an additional period of time.
Packing Credit 7%-7%
Current capital against the bills / contracts as per N. B. 3560
Note: 7% interest rate will be applicable for a period of 45 days. The
interest rate for the additional loan (CCAH) will be applicable for an
additional period of time.
Other Export Credit 7%-7%
LTR (FC): Reciprocating interest in foreign currency 13%-13%
Cash-credit/Hypothication in Export-oriented projects 13%-13%
(excluding LC / agreement papers): For collection of
advance goods before receiving export orders
Working capital of export-oriented industries 13%-13%
BMRE in export projects 13%-13%
Loan General 13%-13%
Cash Credit (Hypo) 13%-13%
PAD (EDF) 6 Months Libor + 2.50
PAD (GMT) 13%-13%
Demand Loan (BBLC) 14%-14%

3.1.6 Financing in Green Banking

Financing to establish hybrid Hoffman Kiln (HHK) / equivalent technology plant for the
purpose of reducing carbon emissions in solar power, biogas, waste purification plant
and brick field. Interest Rate – 13% - 13%

3.1.7 Term Loan for Micro and Cottage Industries

Dairy farming / cows, thickening of tajakaran and poultry chicken 13%-13%

farms, semi-intensive shrimp, fisheries etc. and establishment of
other small industries. (3 Crore and less)
Other small and cottage industries loans 13%-13%
Weaving Loans 13%-13%
Brood breeding loan program 10%-10%

3.1.8 Other Loans

 Service Industry
 Interest rate on special economic zone (SEZ) loan (interest rate determined in all
programs / projects in Rangamati, Khagrachari and Bandarban areas)
 Home renovation loan
 Jute related Business
 Commercial loans under US-sponsored projects
 Commercial house construction in urban areas
 Construction of residential houses in urban areas

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  Continuous Benefit Account (CBA)
 Loan against Medical Deposit Scheme (MDS)
 Loans against NRPS
 Loans against JBMBS
 Loans against RSS
 Loans against JBMSS (4 and 6 years)
 JBL’s Specials Products
 Work Order (13%)
 Loans against National Investment Bond, ICB Unit, Insurance Policy, Share
Debenture
 Loans against FDR of Other Banks
 BADC or BRTC
 Brick Field
 Loans against Wage Honours Bond
 Food Ministry (Internal Food Collection)
 JBDS
 Loans against Education Deposit Scheme
 Loans against Medical Deposit Scheme

3.2 Micro-Enterprise and Special Credit

Retail Customer Department (RCD-4) is responsible for implementing of (i) Micro Credit
Programs related with the poverty reduction, (ii) Special credit programs related with
employment generation and (iii) Financing of agro-based industries.

Bank has different micro-credit programs of its own & in collaboration with other
agencies. For successful implementation of these credit programs especially poverty
reduction credit programs it requires close supervision and monitoring. Considering
Bank's manpower/field staff it is not always possible to ensure intensive supervision at
the grass root level. To make the micro credit programs time & cost effective bank has
initiated linkage program using intermediaries/collaborating agencies (GOs & NGOs).
Collaborating agencies are responsible for organizing the target groups (conducting
survey, formation of groups, providing training etc.) including supervision and recovery
of credit.

The main features of different micro-credit programs are narrated below:-

Objectives : For creation of self-employment & poverty reduction.

Area of operation : Throughout the country.
Term : ST & MT.
Security : (a) Up to Tk.50,000/-, no collateral is required
(b) Personal guarantee in favour of loanee from an
acceptable person.
(c) Hypothecation of goods ( If applicable).
Disbursement : Disbursement is made in cash by installments. Purchase
receipts/documents to be kept in respective loan file.
Repayment : Repayable by weekly/fortnightly/monthly installment.
Repayment period and mode of repayment is fixed

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 depending on the nature of activities & generation of income
Rate of interest : 11%

2. Small Farmers & Landless Labourers Development Project(SFDP)-1976

Objectives : Employment generation of the poor.

Collaborating : Bangladesh Academy for Rural Development (BARD), comilla.
agency
Approach : Group. A group consists of 7-10 members.
Term : ST.
Security : a) Hypothecation of goods.
b) Group guarantee.
c) Lien of group savings.
Interest Rate : 11%
Disbursement : Disbursement is made in cash or through group's savings
account.
Repayment : Loan is repayable in installments (weekly/monthly etc.) It
depends on the nature and purpose of loan.

3. Swanirvar Credit Scheme -1978

Collaborating agency : Swanirvar Bangladesh

Area of operation : : 247 unions of 87 Upazillas. 167 branches are designated.
Approach : : Group. Each group consists of 5 members.
Security : : a) Hypothecation of goods.
b) Group guarantee.
c) Lien of Group savings.
Rate of Interest : : 11%
Disbursement : : Disbursement is made in cash.
Repayment : : Loan is repayable with interest by 52 weekly installments.

4. Co-operative credit for rural poor-1980

Collaborating agency : BRDB(Bangladesh Rural Development Board).

Area of operation : Noakhali, Luxmipur & Feni District.
Objectives : Financing to the co-operative members of primary
societies (eg. Farmer's society, Women's society etc.)
Under 2-tier co- operative.
Major activities : Crop & other different production oriented income
under credit generating activities.
Security : a) Members of managing committee of UCCA are to give
guarantee individually and jointly.
b) Lien of Group share/savings.
Disbursement : Disbursement is made amongst the members of the
primary societies in cash in presence of Upazilla credit
committee(consists of bank, UCCA & primary society

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 representative)

5. Lending through NGOs -1996

Target Group : Poor members of self-help groups(SHGs) organized by

NGOs.
Objectives : In case of individual lending maximum coverage and
constant supervision is not always possible for a bank
branch. Therefore, Lending through NGOs are much cost
effective. On the basis of this observation, bank has
initiated this linking credit program with NGOs.
Security : a) Mortgage of properties( 1 1/2 times of loan)
b) If the NGOs are not able to arrange mortgage of
property in that case they are to build up a guarantee
fund A/C equivalent to loan limit. Initially 30% - 40% of
the fund to be raised before disbursement of loan. Rest
of the fund to be raised gradually (as decided by bank-
weekly/ fortnightly basis) within the loan period.
c) For CDF-NGOs, no such collateral is required. In this
case CDF provides guarantee.
d) Members of the Executive Committee of the NGO are
to give guarantee individually and jointly.
Disbursement : Disbursement is made in installments through their
savings/current account.
Rate of interest : 11%
Repayment : To be repaid by fortnightly/monthly installments within
1 1/2 -- 3 years.

6. Grain Storage credit- 1991

Target Group : Crop producers( Small & Marginal farmers)

Area of operation : Allocated unions of Jamalpur, Jessore, Jhenaidah, Magura,
Dinajpur, Rajshahi, Rangpur, Bagura, Gaibandha and
Naogaon.
Objectives : To ensure fair prices of agricultural produces and save the
farmers from financial losses during the harvesting season
when crops are sold at a comparatively lower price.
Sanction : Loans are sanctioned against cereal stored in godown
Disbursement : Disbursement is made in cash
Security : Hypothecation of cereal crops stored in godown
Rate of interest : 10%
Repayment : Entire amount of loan is repayable within 6 months. For seed
repayable within 9 months

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7. Ghoroa Prokalpa/ Family based micro credit:

Target Group : Rural poor people male or female and should be capable to
conduct the activity for which the credit to be applied for.
Area of operation : Unions under SACP(approved by H.O.).
Objectives : (a) Accommodating maximum rural dwellers in production/
income generating activities.
(b) Making each household a " Production Farm." & thereby
to make them economically sustainable.
Loan size : Maximum TK.40, 000/- per family. Loan size depends on the
nature of loan and varies from purpose to purpose.
Security : (a) Hypothecation of the goods against which loan has been
given.
(c) Under this program security has not been given priority.
Importance has been given on close supervision , monitoring
and evaluation.
Disbursement : Disbursement is made in cash or kind through single or 2
installments.
In kind, through payment order to supplier. Purchase
receipts/ documents to be kept in respective loan file.
Repayment : Repayment by fortnightly/ monthly/ half yearly installment.
Mode of repayment depends on nature and purpose of credit.

3.2.1 Entrepreneurship development Programs

1. Women Entrepreneur Development Credit program.

Target Group : Prospective women entrepreneurs those who are

(a) producing/marketing goods by themselves or through
others.
(b) eager to utilize their educational/professional
experience and like to set up new projects or BMRE of
existing projects and need working capital.
Purpose of loan : Dress making, Bed cover, Bed sheet, Pillow cover,
Embroidery, Block, Screen Printing, Doll making, Artificial
flower making, Gift item, Small printing industry, Foods
processing (Jam, Jelly etc.), Spices processing, Store
running, Fast food item, Leather products, Jute products,
Bamboo and cane products, Plastic products, Pottery,

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 Service-oriented Tele-Phone-Fax-e-mail & computer
service, Day-care centre, Nursing home, Diagnostic
centre, Clinic set-up and running etc.
Security : Personal guarantee of the applicant, Personal guarantee
of the applicant's husband/father or earning members
from any dears & near one's, guarantee from any known
& highly acclaimed person of the society/organization to
be obtained.
Disbursement : Disbursement is made in cash. But in case of
procurement of machineries/equipments disbursement is
to be made through pay order to the supplier of goods.
Delegation : Sanction power lies with Head Office and field level.
Rate of interest : 10%
Repayment : To be repaid in three years on monthly installment basis
with a grace period of 3 months. For working capital,
C.C. loan procedure is being followed.

2. Cyber Cafe

Target Group : Trained youth in computer technology.

Area of operation : 10 designated branches of Dhaka city and corporate
branches-I & II of Chittagong, Khulna, Rajshahi, sylhet and
Barisal divisional head- quarters.
Objectives : (1) To create employment opportunity for the unemployed
trained youth and expansion of information technology.
(2) To purchase computer, server, networking, Internet
connection, Printer, Scanner, CD writer, UPS, Decoration
etc.
Eligibility : (a) Applicants must have minimum diploma degree in
computer science or company formed by them.
(b) Companies having prior experiences in cyber café
business .
(c) Concerned business at project area to be verified before
loan sanction/disbursement. In regards cyber café's work
station appraisal of viability to be considered.
(d) Age Limit: Minimum-25 yrs
Maximum- 65 yrs
(e) The applicant who can repay monthly loan installment
excepting the 1/3 of his monthly income.
Security : (a) Loans up to Tk. 3.00 Lac, no collateral is required and
above Tk. 3.00 Lac collateral is required (1.5 times of loan).
(b) In case of no collateral, advance dated cheques (one for
each installment and additional one) are to be taken.
(c) Hypothecation of computer and all other equipments
(d) In case of no collateral security, 3rd person guarantee is
required.

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Documentation : D.P note & other charge documents.
Disbursement : Disbursement is to be made in cash by installments.
Purchase voucher/receipts to be kept in respective loan file.
Rate of interest : 12%
Repayment : To be repaid in 36 monthly installments, starting next
month from disbursement.

3. Doctor's Loan Scheme:

Target Group : MBBS or its equivalent degree holders registered Doctors like
Medical Practitioners, Eye Specialist, Cardiologists, Surgeons,
Dentists etc, any group of doctors or any institution/company
formed by the doctors may apply for availing this loan in the
bank's prescribed form.
Objectives : (a) Inducing health services through all over the country.
(b) To create employment opportunity of Doctors .
(c) Making Chamber and purchase of required machineries and
equipments.
Eligibility : (a) The aforesaid categorized doctors must possess valid
approval or license for general practices from the competent
authority.
(b) Those doctors who are not fully engaged may get
preference for enjoying this new facility.
(c) Age Limit: Minimum-25 yrs
Maximum- 65 yrs
(d) The doctors who can repay monthly loan installment
excepting the 1/3 of his monthly income.
(e) Experience: 2 yrs.
Debt-Equity Ratio : 80:20(Minimum).
Security : (a) In case of no collateral security, advance dated cheques
(one for each installment and additional one) are to be taken.
(b) Guarantee from the person acceptable to bank to be
obtained in case of loan without collateral/Original certificate of
degree
(c) Personal guarantee of borrower's
husband/wife/parents/mother/father/adult children to be
obtained.
(c) Hypo. of all furniture & machineries of chamber.
(d) Original copy of license of general practitioner to be
obtained.
(e) In case of group loan, one person will give guarantee for
another.
(f) Having been verified certificate/license/guarantee submitted
by applicants carefully, these to be obtained.
(g) The equipment purchased shall duly be insured covering all
risks.

Page | 29
 (h) Personal guarantee of borrower's
husband/wife/parents/adult children to be obtained.
(i) Encashable securities equitable to loan or mortgage of
landed property (1.3 times of loan) to be obtained.
Sanction : Loans are sanctioned on the basis of production plan at field
level and Head Office as per delegation.
Documentation : D.P note and other charge documents.
Disbursement : Disbursement is to be made in cash by installments. Purchase
voucher/receipts to be kept in respective loan file.
Rate of interest : 15%
Repayment : To be repaid in 5 years in 57 monthly installment with a grace
period of 3 months.

4. Small business development loan scheme

Target Group : Those who are running the business by purchasing shop's
possession or renting for a specific time.
Objectives : Expansion of existing shop & providing term loan/working
capital to existing shop
Eligibility : Those unemployed educated youth who have no ability to
give collateral but involved in businesses such as all types of
handicrafts, book, crokeries, all kinds of furniture, grocery &
stationery shops, departmental store or any other income
generating activities.
Security : (a) Loans up to 5.00 Lac, no collateral is required in both
term loan & working capital. Up to maximum Tk. 25.00 Lac,
collateral is required in both term loan & working capital (1.5
times of loan).
(b) In case of no collateral, 3rd person guarantee is required.
(c) Shop's possession right/ rental agreement to be obtained
with consent letter of house/shop's owner.
(d) In case of group loan, one person will give guarantee for
another.
Debt-Equity Ratio : 70:30
Disbursement : Disbursement is to be made in cash by installments.
Purchase voucher/receipts to be kept in respective loan file.
Repayment : To be repaid in 5 years in 60 monthly installment in case of
term loan. For working capital C.C. loan procedure is being
followed.
Rate of interest : 12%
Major activities : Handicrafts, Book, Crokeries, All kinds of furniture, Stationary
under loan shop , departmental store or any other income generating
activities.

3.2.2 Special Credit Program:

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1. Seed Development Programme

Target Group : Farmer's Seed Company (FSC).

Area of operation : FSC are located in the following 10 districts:
Gopalgong, Naogaon, Bhola, Sherepur, Maulvibazar,
Dinajpur, Chuadanga, Jhenaidah, Patuakhali and Coxs bazar.
Objectives : To extend loan to farmer's seed company for procurement,
processing & marketing quality seeds for the development of
private seed sector.
Eligibility : (a) The concerned (FSC) are to be duly registered under the
companies act, 1994 of Bangladesh.
(b) The shareholders and directors of such companies must
be residing in the concerned locality.
(c) The loan taking FSC must maintain their fund/deposit
company's account with the financing branch.
(d) The concerned (FSC) or its directors/shareholders are
not defaulter loanee of other bank/financial institution.
Security : (a) The guarantee fund to be provided by GTZ will be
treated as collateral security.
(b) Hyp. of crops/goods/assets to be produced/procured
with loan money.
(c) The members of the Board of Directors shall provide to
the bank a group guarantee stating their joint and individual
liability to repay the loan.
(d) Seeds/goods/assets procured by bank loan and stored by
the company shall duly be insured as per bank's clause
covering all risks.
Disbursement : Loan to be disbursed for procurement of different
seeds/cereals as per schedule. Purchase voucher/receipts to
be kept in respective loan file.
Debt-Equity Ratio : 75:25
Repayment : Loan for each crop shall be repaid within 9 months from the
date of disbursement of that item. If any FSC for genuine
reasons is not able to repay the loan in time, the branch may
allow a grace period of maximum 3 months.
Major activities : Credit will be provided for mainly- Wheat, Boro, Aus ,Paddy
under loan and other potential crops of the locality.
Rate of interest : 10%
Collaborating : Seed Business Promotion Project/GTZ
agency

2. Loan for Handicapped/disabled people

Target Group : Physically handicapped/disabled people who has the

expertise and intelligence to conduct the economic activity.
Area of operation : All branches up to union level.

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Objectives : (a) To raise the income and living standard of handicapped
people by self employment.
(b) To help build self reliance and to bring them into the
mainstream of economic activities.
(c) To provide assistance for increasing efficiency at work
and in their own professions.
Disbursement : Disbursement of credit on installment basis( one or more) as
per requirement and will depend on nature and sector of the
credit policy.
Repayment : Loan repayment on weekly/fortnightly/monthly/quarterly
basis will depend on nature, sector and income generating
kind of the credit facility.
Rate of interest : 10%
Major activities : All income generating activities suitable for disabled people
under credit such as fish cultivation, milking cow, goatery, beef fattening
etc.

3.3 Other Credit Programs:

1. Credit for Employees-2000

Target group : Employees of different Govt/Semi Govt./Autonomous

body/University/College/School/NGOs etc.
Objectives : To meet up the emergency/personal need (e.g. treatment,
marriage, travel cost, maternity or for specific activities (e.g.
agri. or non agri. purposes etc.) of employees.
Eligibility : (a) The employees of above mentioned organizations
excepting Janata Bank Limited.
(b) Preference to be given those who are taking salary from
our branches.
Security : (a) Personal guarantee of borrower's
husband/wife/parents/adult children or any other 3 rd party
guarantee to be obtained.
(b) 24 for 24 monthly installments and additional one-total
25 advance dated cheques to be obtained.
Rate of interest : 13.50%(Changeable)
Repayment : To be repaid in 2(two) years at equal monthly installment

2. Consumer Credit Scheme-2003

Target group : Fixed income earners.

Objectives : (a) To improve standard of living .
(b) To support purchase of various consumer durables.

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 All branches upto Upazilla level.
Eligibility of Clients : (1) Permanent officer/staff working at Govt
/SemiGovt./Autonomous body/ Nationalised
Bank/University(private/public)/Training institute/Research
institute/Private bank/Insurance company/International
organization/Multinational company.
Security : (a) Hypothecation over the consumer durables.
(b) In case of Janata Bank Limited employee, personal
guarantee from an employee( equivalent or upgraded
ranking employee). Such guarantee to be countersigned by
the competent authority. Officer/staff can give guarantee for
one or more loan. But sum total of one or more guarantee
will not be more than non-encumbered provident fund. Loan
giving authority is to be confirmed to the effect that the
applicant has the capacity to repay bank loan.
(c) Lien of provident fund/gratuity.
(d) Personal guarantee of borrower's
husband/wife/parents/adult children or any other 3 rd party
guarantee to be obtained etc.
Rate of interest : 14%(Changeable).
Repayment : To be repaid in 3 years at monthly installment
Main activities : Personal Computer, Scanner, Air conditioner, Air cooler,
under credit Water cooler, Water pump, freeze, Television, Radio,
Furniture and any other items acceptable to Janata Bank
Limited.

3. Credit for Trained Youth Program

Objectives : For creation of self employment & poverty reduction

Area of operation : Throughout the country
Associate : Bank's own program.
Agencies
Approach : Individual.
Term : ST & MT.
Security : (a)Up to Tk. 80,000/-, no collateral is required. Above up to
5,00,000/- collateral is required.
(b) Personal guarantee in favor of loanee from an acceptable
person.
(c) Hypothecation of goods.
(d) Mortgage of land/property (1.5 times of loan) if applicable.
Disbursement : Disbursement is made in cash by installments. Purchase
receipts/documents to be kept in respective loan file.
Repayment : Repayable by onetime/ installment (fortnightly/ monthly/
quarterly/half yearly). Repayment period and mode of
repayment is fixed depending on the nature of activities &
generation of income.

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Rate of Interest : 10% (changeable).

4. Village Women Employment Credit Porgarm

Objectives : For creation of self-employment of village women & poverty

reduction. Village women those who are (a)
producing/marketing goods by themselves or by others. (b)
Distress women/unemployed women eager to set up Income
Generating Activities (IGAs) and need working capital.
Term : ST & MT & working capital (CC-H) for project/business.
Security : (a)Up to Tk. 50,000/-, no collateral is required and above up
to 5,00,000/- collateral is required.
(b) Personal guarantee in favor of loanee from an acceptable
person.
(c) Hypothecation of goods.
(d) Mortgage of land/property (1.5 times of loan) if applicable.
Disbursement : Disbursement is made in cash/kind by installments. Purchase
receipts/documents to be kept in respective loan file.
Repayment : Repayable by onetime/installment
(fortnightly/monthly/quarterly/ half yearly). Repayment period
and mode of repayment is fixed depending on the nature of
activities & generation of income.
Rate of Interest : 10% (changeable).

5. Refinance scheme for Small/Marginal?Landless farmers & Marginal/Small traders those have
A/C of Tk. 10/- financial inclusion program

Target Group : (a) Small/Marginal/Landless farmers those have maximum

2.47 acre of land.
(b) Marginal/Small traders having low income.
(c) Village/ Mahalla based Small/Micro enterprunears &
professionals.
(d) Women & Handicapped/disabled people.
(e) NGO-MFI Linkage program.
Area of operation : Throughout the country
Activities & : : Applicant should have Bank A/C of Tk. 10/-
Purpose of loan (a) Income Generating Activities (IGAs)
(b) Agriculture/Fisheries/Nursery etc.
Associate : Bank's own program.
Agencies
Approach : Individual/group (3 to 10)
Term : ST & MT
Security : (a) Up to Tk.50,000/-, no collateral is requird.
(b) Personal gurantee in favour of loanee from an acceptable
person.
(c) Hypothecation of goods. (d) group guarantee

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Disbursement : Disbursement is made in cash/kind by installments. Purchase
receipts/documents to be kept in respective loan file.
Repayment : Repayable by onetime/installment
(fortnightly/monthly/quarterly/half yearly). Repayment period
and mode of repayment is fixed depending on the nature of
activities & generation of income
Rate of Interest : 12% (changeable).

6. ককক চচচ সচর ঋণ উৎ পচদন করর্মসসচচ:

উদদ্দেশশ : ক) জমরর উৎ পচদন ক্ষরতচ এবব এর উপযযক গঠন প্রককমত ও উবর্মরতচ সবরক্ষণসহ
রচসচয়মনক সচচরর উপর মনরর্মরশচলতচ করচচনচ । (খ) পমরচবশ বচন্ধব/গচণ ববচবমকব পমলমস
বচস্তবচয়ন
ঋণসসীমম ও সদরর মচ সসসলল : (ক) ৫০,০০০/- টচকচ পযর্মন সহজচরচনত মবহচন । ববচবচকর নচমতরচলচ অনযযচয়চ সহজচরচনত
গহণ সচচপচক্ষ সচবর্মচচ ঋণসচরচ = ৩,০০,০০০/- টচকচ ।
ঋণ পমসপ্তির যযমগশতম : একক ববমক অথবচ কযযৌথ মরমত্তিচত উৎ পচদনকচরচ পমরবচর/প্রমতষচন ।
ঋদণর পককৃসত : স্বল/রধব করয়চদচ (১-৩ বছর) ।
ঋদনের জমমমনেত : (ক) আচবদনকচরচর সচ/স্বচরচ/উপর্মচজনশচল রচতচ/মনকট আতচচয়র ববমকগত গবচরচমন। (খ) ঋচণর
অচথর্ম ক্রয়ককত গচরচ/গর, ককক চচচ এবব উৎ পচদনককত ককক চচচ সচর ববচবচকর মনকট হচইচপচমথচকশচন
থচমকচব। (গ) ঋচণর কদড়গুণ রসচলবর সম্পমত্তি/জমর ববচবচকর অনযকসচল করমজষচরর্ম রটর্মচগজ
থচমকচব।
ঋণ সরতরণ পদ্ধসত : প্রচয়চজন অনযসচচর ০১ কথচক ০৩ মকমস্তচত মবতরণচযচগব ।
পসরদশমদধের সসূ সচ : ঋচনর করয়চচদর রচধব ষচনচমসক মকমস্তচত পমরচশচধচযচগব ।
সসু দদের হমর : ১২% ।

7. Bicycle loan program for students

Loan for the purchase of bicycles for school, college and madrassa students.
Interest Rate – 9%
Duration – 3 years
Limit – Maximam 12,000 Tk.

3.4 Agro-based Industries.

The agro-based industries (e.g. agro-products & food processing units, vegetable/potato
storage, agri.-products storing and marketing, rice/flower mill etc.) have been
considered as thrust sector. Financing in this sector following aspects are to be
considered:

(a) Selection of entrepreneurs:

 solvency,
 good will,
 professional and technical experience,
 Capable to provide equity and security etc.

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(b)Selection of projects-
 cost- effective & viable,
 suitable in respect of communication and infrastructural facilities,
 Demand of the produced goods & favourable marketing facilities.

(c) Debt-Equity Ratio: minimum margin 40% (Working Capital), 50:50-Project loan.
(15% of total project cost as land value or actual value of land whichever is lower to
be adjusted with the total equity)..

(d) Land development, link road development, electricity connection etc. are to be
completed from entrepreneur's own source.

(e) Recommendation from branch and regional office in respect of loan sanction is
required.

(f) Loan is to be sanctioned after completing technical and financial analysis of the
project by the Head Office.

(g) Equity is to arrange at a time or phase-wise as decided by H.O.

(h)Security:
i) Project loan:
a. 1:1-the value of mortgaged property to be equivalent of loan
b. Hypothecation of machinery & equipment (floating assets of the project).

ii) Working capital:

a. 1:1.5 - the value of mortgaged property to be equivalent to 1.5 times of
loan.
b. Hypothecation of goods produced & procured.

3.5 Other Credit Programs

Loan to Travel Agencies

SalientFeatures
 Eligibility: Annual business turnover should be satisfactory
 Loan Sanction: On a case to case basis
 Nature of Loan: CC (HYP).
 Purpose of Loan: For running travel agency business
 Rate of Interest: 15%
 Security: Hyp. of receivables/tickets, all office furniture and equipment’s
Collateral to be twice the value of the loan
 Mode of repayment: Sale proceeds of tickets.
 Duration of the Loan: One year
Loan to Diagnostic Centers

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Salient Features
 Eligibility: Anual business turnover should be good;the diagnostic centre should
have been set up as per Govt. health policy and this must be confirmed by the
loanee.
 Loan Sanction: On a case to case basis
 Nature of Loan: CC (HYP).
 Purpose of Loan: For running a diagnostic centre
 Rate of Interest: 15%
 Margin: 40%
 Security: Hypothecation of all chemical and medical equipments; Value of
collateral security to be twice that of loan
 Duration of the Loan: One year

3.6 Financing IT Sector

To hasten the growth of information Technology and to attract young energetic IT
professional Janata Bank Limited has launched a credit scheme titled "Financing
Computer Software Development & Data Export". The maximum loan amount is Tk. 10
million, with debt to equity ratio being 80: 20. The rate of interest is 11%. But anybody
with export market exposure can get the benefit at 7% interest rate plus 1% service
charge. The main feature of this scheme is to set up industrial based IT projects for
development of software for data export and that too on a very soft term. Janata Bank
Limited has issued detailed guidelines for facilitating IT entrepreneurs.

Eligibility to be a Loanee: The loanee (sponsors) should have a degree in Computer

Science/or related subjects like Electronics Engineering, Electrical Engineering,
Telecommunication Engineering, Applied Physics, etc or proven record of managing IT
companies. Computer literate and sponsors having a Diploma in Computer, young
energetic and qualified sponsors whom the Bank consider fit to take loan. The sponsors
should form a limited company.

Preferences: Sponsors/companies having prior experiences in the related field will be

given priority.

Loan Limit & Debt-Equity Ratio: This scheme provides maximum of TK.10 million
(around US$ 1,44,000). For a loan up to TK.5 million (around US$ 72,000) debt-equity
ratio will be 80: 20 and over TK.5 million (US$ 72,000) the ratio will be 70:30.

Rate of Interest: 13%

Repayment Mode & Period: 5(Five) years including 6-12 months grace period
(Including construction period). Repayment of half yearly installment with interest
compounding for term loan. Repayment period for working capital loan and export cash

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credit is 1(one) year. Interest During Construction Period (IDCP) will be repayable in 3
(three) yearly installments.

Rebate on Interest: In case of regular repayment, the sponsor company will be given
5% rebate on total interest charged.

Security: No collateral security is required. If any loanee willingly shows interest to

provide collateral security, they will be given priority.

3.7 Financing of Industries

Loan Limit: Janata Bank Limited may be financed up to Tk. 129.60 million in single
project a year. But if any project required above the limit, the project may be
financed under consortium/syndication arrangement with other financial
institutions.
Debt Equity Ratio: Normally debt equity ratio is 50:50. But higher equity ratio sharing
is given preference. Above all, Bankers/Customers relation is also considered in
fixing debt equity ratio.
Rate of Interest: Rate of interest of project loan ranges from 11%-13% . Working
capital rate of interest is 12% to 13.50% and with that in export oriented
industries ranges from 7% to 14%(changeable).
Repayment Mode and Period: 5 years to 10 years with 6-24 months grace period
inclusive of construction period. Project loan is repayable by half yearly
installment. Working capital loan and export credit are sanctioned for 1 (one)
year and they are renewable every year.
Security: The project land, building, machineries and others i.e. project assets are
considered as primary security against term/project loan. But if the project is to
be set up on rented premises, collateral securities is obtained obtained minimum
1.3 times of project loan.

4.0 Loands and Advances Performances of JBL

Loans & Advances increased by BDT 30,088.05 million during the year 2015 and stood
BDT 349,861.30 million which was BDT 319,773.25 million in 2014 showing a
sustainable growth of 9.41 percent over the previous year. Concentration of loans and
advances was well managed and details of concentration are given at notes to the
financial statements.

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Industrial Financing
Bangladesh is progressing through the industrialization process in various sectors,
leaving behind the identity of under developed country to developing country. In order
to achieve sustainable growth, JBL is working hard and has given due focuses on
entertaining large corporate house with skilled and dedicated team under Corporate
Customer Department CCD-1 & CCD-2.

In 2015, JBL has disbursed BDT 15,141.47 million in different industrial sector. The table
given below shows the Industrial loan mix:

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SME Financing
SMEs play a vital role in any economy in terms of employment, income generation,
alleviation of poverty and development of local markets and supply chain. Its also
develop local products services for local needs using local resources. Keeping this in
mind, JBL has formulated a comprehensive policy for SME financing under the guidelines
of Bangladesh Bank and made significant progress in financing this sector with a view to
developing a balanced and dynamic industrial sector having a strong base of SMEs
throughout the country. JBL puts its continuous efforts by participating in various road
shows, workshop, forums and fairs to build awareness among the customers as well as
building capacity of the SME officials. To ensure vibrant native economy by financing in
the SME sector, JBL is working relentlessly and has disbursed BDT 39,254.20 million in
favor of various SME entrepreneurs in 2015 which is shown under the table.

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Financing Women Entrepreneurs
Another important concept of SME financing is to develop the women entrepreneurship.
Under the framework of SME, JBL is giving special emphasis in developing women
entrepreneurs and in line with the regulatory instruction, JBL provides credit facilities in
support of home decoration, boutique, printing services, processed food, fast food etc.
In 2015, JBL has disbursed BDT 64.98 million to 1,691 women entrepreneurs at reduced
interest rate. The following table shows the number of entrepreneurs and amount
disbursed during last 5 (five) years.

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Agricultural Financing
Agricultural activities are the main driven forces of Bangladesh economy. The
overall economic growth of the country is closed with the development of
Agricultural sector. To ensure food security, there is no alternative but to
increase agricultural production. According to the Rural Credit Policy and program
of Bangladesh Bank, crops, fisheries, livestock and green finance will have to be
given priority. Considering agriculture as a sector of more dependent on credit,
JBL continued its proactive support program to gear up agricultural financing
since 1974. JBL disburses agricultural loan for various purpose which includes
corps, vegetables, fisheries, livestock (Poultry, Dairy and beef fattening) and
poverty alleviation. In 2015, JBL has been disbursed BDT 7,617.17 million as
agriculture loan. The table given below shows the purpose wise agriculture loan
disbursement during 2015:

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Import Financing
During the year, import trade stood at BDT 147,182 million against
144,557 million at the end of 2014. The summary of import financing
for the year 2015 and 2014 are given below:

Export Financing
The major share of countries earnings comes from export of
Readymade Garments. Considering the growth of export in line with
JBL's priority to serve the customers with better service, a
department named Foreign Trade Department is working with a
specialized team to support the emerging Readymade Garments and
Textiles sector.
Now JBL has a sizable portfolio in export financing. Our all Authorized
Dealers (AD) are well equipped to serve country's export oriented
industries. In the year 2015, export business of JBL stood at BDT
145,352 million against BDT 154,080 million of 2014.

The summary of export for the years 2015 and 2014 are given below:

Page | 43
5.0 Investment Mechanism of JBL’s Moghbazar Branch
Moghbazar branch of Janata Bank Limited is located at 63/A Bara Moghbazar, Dhaka
1217; one of the important branches of Janata Bank Limited. Moghbazar branch have
been providing best possible services to its customer from the beginning with good
reputation. In this section investment Mechanism of Moghbazar branch will be discussed
in details.

5.1 Structure of the branch, Software and Services

Any organization is operated by maintaining the principle of hierarchy to maintain the
operation of the organization. This will ensure the easy execution of the operation by the
employees of the organization. The Moghbazar Branch of the Janata bank has the
following structure

Figure: Moghbazar branch Structure

Banking Software
Janata bank uses “BexiBank 5000+” software for the banking activities. For the record, it
is a back dated software for banking service. A new software called T-24 (core software
for Janata bank) has been added and it is not reached all the braches yet. Moghbazar
branch got it last month but still in development stage.

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Backward side of BexiBank5000+
1. Does not have online feature: This includes the online money transfer facility. For
money transfer it have to make sure that the receiving branch has the BexiBank
software.
2. Unable to view all detail of other branch’s account: Clients always ask to check
their balance status, whether deposit has been added or not etc. But BexiBank
5000+ can only access that branches status.
3. No authorization system: Banking is all about other people’s money and it is very
risky to make mistake. So a double check system is very helpful here.
Authorization system allows that. For example, Employee A made the payment
from pay order, it will first go randomly to other employee say Employee B. He
will get a chance to check for any discrepancy of the payment than authorize
that. A little mistake can prove costly later and this system is reduces that.
Bexibank5000+ down not have that feature.

Islamic Banking
Janata Bank doesn’t provide Islamic banking facility. Though it has taken permission
from Bangladesh bank, it has not started yet. On the other hand, Sonali bank does that.
Since Bangladesh have majority of its people are Muslim, Islamic banking is a popular
service here. Janata bank is losing many customers from this group. Thus, it is kind of a
huge drawback for Janata bank Limited.

Online banking
Janata bank has online facility but it is not up to mark yet because only few branches
are fully online. As a result, there is limited opportunity to transfer money. Again, we
know that an account holder is required as introducer to open new account. Non online
braches are required account holder from that branch only. As I worked in Moghbazar
branch, many client face trouble to find the introducer.
Utility service
Service offered by Janata bank
 Gas bills.
 Electricity bills
 Telephone bills of Telegraph and Telephone Board.
 Water/Sewerage bills of Water and Sewerage Authority.
 Municipal holding tax of City Corporation/Municipalities.
 A pilot scheme is underway to provide personalized services to our clients

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5.2 Investment Mechanism
Bank Overall Investment Mechanism hardly represent it’s specific branches. Branch’s
investment mechanism depends on its surrounding area and businesses. Thus branch
doesn’t follow or can’t follow the rules or criteria set by Head Office or Bangladesh Bank
in terms of Investment Mechanism. Main Objective of investment Mechanism is to earn
profit by accepting deposit from the surplus and allowing loan to the deficit group.
Types of credit facilities:
 Term financing for new project had BMRE of existing projects (large, medium,
SME, SCI).
 Working capital for industries, trading services and others (large , medium, SME,
SCI).
 Trade finance for import and export
 Lease finance
 Small loan for traders, micro enterprise and other productive small venture.
 Consumer finance
 Fee business

Procedure of Loan Disbursement of Janata Bank Ltd.

Janata Bank Ltd. collects credit information about the applicant to determine the credit
worthiness of the borrower. The bank collects the information about the borrower from
the following sources:
 Personal investigation.
 Confidential report from other bank Head Office/Branch/chamber of the
commerce.
 CIB Report from Central Bank.

Processes:
 Ledning Risk analysis
o Industry risk
o Management risk
o Security risk
 Proposal Analysis
o Safety
o Liquidity
o Profitability
o Security
o Purpose of the loans
o Sources of repayment
o Diversification of risk etc.
 Loan disbursement
 Documentation of the Loan

Page | 46
 Table: Moghbazar Branch’s Investment in Different Sectors, 2016
Sl. no Particulars Figure in Taka(lacs)

01. Secured Overdraft (Financial obligation) 8.64

02. Secured Overdraft (Real Estate) 217.00

03. Staff House Building Loan 431.00

04 General loan 1972

05 Loan Against Provident Fund 14.57

06. Cash Credit 96.00

07 Loan against General House Building 123.00

08 Loan against Rural Credit 25.26

Total 2887.47

Though loan against Rural Credit shows a figure of Taka 25.26 yet it is not agricultural
loan. Various types of loans which do not fall under the traditional category mentioned
in the Statement of affairs, have been incorporated under this head such as NGO Loan,
Poverty alleviation loan, Doctors loan, Women loan, Service holder’s loan etc.

Import Financing:

Janata Bank extends the Import Financing facilities to the importers. Mainly machinery
parts are imported by the local merchants mainly from India, Pakistan and China. The
volume of import through this branch by the local importer is around 25 crore Taka.
In Moghbazar Branch

Customer balance list in static

Cash credit (hypo): Total A/c no -14=9512581.20
Overdraft (od) secured against financial obligation
(Balance as on: 30dec, 2016)
(Report date: 30dec, 2016)
Total =863737.74
Loan against general house building balance – 30dec, 2016
Total a/c no-12287058.29
Loan against commercial real estate: balance as on 30dec, 2016

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Total a/c no -3=33937217
Loan against rural credit – 30dec, 2016
Total a/c no 52= 262587203 Tk
Loan general (other than MCI) – Total=194814949.00
Loan against staff house building =Total amount =43122520
Loan against provident fund – Total=1456979.00 Tk
Loan general (car loan) = 10, 01,000.00Tk
Loan general (MCL) Total=14, 02,549.00Tk
Staff computer loan =455,654.00Tk

30, Dec, 2015

Bridge finance = 0.00
Loan against Rural credit = 27, 1054, 123Tk
Loan against transport = 0.00
Loan against general house building = 140, 28,878.00
Loan general = 26, 14,458.26
Loan against foreign bills = 0.00
Loan against staff house building = 26769732.04Tk
Loan against commercial real estate = 6329931.00
Staff computer loan = 542,988.00Tk
Total = 5819, 3725.15/=

Advance – overdraft: OD Clean -0.00

TOD -11.00
OD secured -23, 82,227.74
Cash credit -83, 23,211.20
31 Jan, 2017
Loan against rural credit = 262574794.00 (interest rate for staff=13%or NGO=10%)
Loan against staff house building = 4, 10, 29062.7 (interest rate 13%)
Loan for general people =169663235 (here interest rate is more than 2% for FDR, DPS,
SAVINGS interest rate)
Loan against staff house building = 4, 10, 29062.7 (interest rate 5%)
Loan against provident fund =1424971.00 (interest rate 5%)
Staff computer loan = 4, 39,328.00 (interest rate 5%)
Loan against commercial real estate =280, 30,159.00 (interest rate 13.5%)

Advance overdraf

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TOD 11.00
OD SECURED 574453
Cash credit 103,53,649
Total 109,30,115.00
Advance discount foreign documentary bills (for 47,56,375.76
purchase )

Amount of the Credit of the Janata bank LTD

In Moghbazar branch (30March, 2017)

Particular Amount
Rural credit 26,25,68,270.00
General house building 1,18,15,628.00
Transport 00.00
General 16,98,37,659..00
Staff house building 4,15,14,028.79
Provident fund 14,17,56200.00
Staff computer loan 4,20,528.00
Commercial real estate 3,17,80,159.00
Od secured 5,74,590.74
Cash credit 91,62,045.20
Foreign documentary bill 47,56,375.00

6.0 Analyzing the Financial Performance And Various Ratio in Jbbl

Analyzing the financial performance (also called financial analysis) is so much essential
for each and every business institution as well as for the Banking institutions. Financial
analysis typically is associated with ratio analysis. Ratio analysis involves the methods
of calculating and interpreting the financial ratios to analyze the firm’s relative financial
performance. The main purpose of this analysis is to analyze and monitor the firm’s
financial performance, so, that the interested parties (both the external and internal)
can realize the firm’s actual performance easily, which is so much essential for the
parties. There are several ratios that help a particular analyst to analyze the past

Page | 49
performance of a particular firm and to diagnose the various relevant variables, which
are important for improving the future operation of that firm. The financial ratios, those
are useful for analyzing the past financial performance of a financial institution, such as
– Bank, can be divided into five broad categories for convenience and they are
enumerated below
 Liquidity Ratio
 Operating Efficiency Ratio
 Profitability ratio

Liquidity Ratio: It measures a firm’s ability to meet up or satisfy its short term
obligations, as they become due. The commonly used liquidity ratios are-

 Net-working Capital: Net working Capital although not actually a ratios, is a

common measure of firm’s overall liquidity. It measures a particular firm’s liquidity
by measuring the excess of current assets over the current liabilities. So, it is
calculated by using the following formula-
Net-working Capital=Total Current Asset – Total Current Liabilities
Table: Net-working Capital ratio
Name of ratio Years
2011 2012 2013 2014 2015
Net-working Capital 56.651 106.307 26.924 68.930 95.844

Interpretation: We know that net-working capital measures a firm’s ability to serve

its short term obligations as they become due, by measuring the excess of current
assets over the current liabilities and the higher the ratio, the higher the liquidity of the
firm. So after observing the above graph, we can say that the net working capital and
as well as the liquidity of JANATA Bank is fluctuating year to year, which is risky for the
company and the Bank had highest of liquidity in the year 2012 and lowest level of
liquidity in year 2013 but the Bank’s liquidity is increasing at an increasing rate form the
year of 2013 to 2015, as they have maintained a steady level of current liabilities,
which is favorable for the Bank.

 Current Ratio: A measure of liquidity, calculated by dividing the current assets by

current liabilities. It shows the level of current assets that a particular firm has
against per Taka of current liabilities of that firm. So the equation becomes-

Current ratio = Current assets / Current liabilities

Name of ratio Years
2011 2012 2013 2014 2015

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 Current Ratio 1.60 1.78 1.13 1.17 1.25

Interpretation: We know that, the current ratio measures a firm’s liquidity by

measuring the portion of its current asset relative to its current liabilities and the higher
the ratio, the higher the liquidity of the firm. So, after observing the graph shown
above, I would like to say that the company’s current ratio is fluctuating year to year
and Bank’s current ratios are always below the standard level (2), which is not good
and risky for the firm – JANATA Bank. But from the year 2013 to 2015 Bank’s current
ratio as well as the liquidity is increasing at slow rate, which is good for the Bank and
the Bank should try to maintain or improve the liquidity of the Bank

 Operating Cost to Income Ratio: It measures a particular Bank’s operating

efficiency by measuring the percent of the total operating income that the Bank
spends to operate its daily activities. It is calculated as follows:

Operating Cost to Income Ratio = Total Operating Cost/Total Operating Income

Table: Operating Cost to Income Ratio

Name of ratio Years
2011 2012 2013 2014 2015
Cost to Income Ratio (%) 34.24 33.06 31.00 27.04 31.54

Interpretation: We know that this ratio measures the operating efficiency of a

particular Bank my measuring the portion of the total operating costs relative to the
total operating income of that Bank and the higher the ratio, the lower the operating
efficiency and vice-versa. So, after observing the figure drawn above, I am able to say
that, during the time period between the years 2012 to 2015, the operating efficiency
of the JANATA Bank was increasing, which was a good sign of the Bank but in the year
2013, the ratio started to increase, which indicates that the Bank is incurring more
costs than that of previous years and this is not a good sign for the Bank. So the Bank
should give a close eye on this matter to improve its efficiency
 Total Asset Turnover: Total Asset Turnover indicates the efficiency with which
the firm uses its assets to produce operating income. It is calculated by using the
following formula:
Total Asset Turnover = Total Operating Income /Total Assets
Table: Total Asset Turnovers
Name of ratio Years
2011 2012 2013 2014 2015

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 Total Asset Turnover 0.052 0.047 0.05 0.047 .048

Interpretation: We know that this ratio measures the return from per unit of total
assets and the efficiency of the Bank in using its total assets to generate operating
income and the higher the ratio, the higher the efficiency of the Bank in using its
assets. So, after observing the given graph, we are able to say that the return from per
unit of total asset, as well as the Bank’s efficiency in generating income is fluctuating
from year to year and the Bank generated the maximum turnover in year 2005 and
lowest turnover in the following year 2013 but from the year 2015 the return from per
unit of asset is increasing, which is a good sign for the Bank and the Bank should try to
maintain this performance.

 Fixed Asset Turnover: It measures the return per unit of fixed assets. It is
calculated by using the following formula –
Fixed Asset turnover = Total Operating Income/Net Fixed Assets

Table: Fixed Asset turnovers

Name of ratio Years
2011 2012 2013 2014 2015
Fixed Asset Turnover 5.3 6.581 8.032 9.651 11.287

Interpretation: We know that this ratio measures the return from per unit of fixed
assets as well as the Bank’s efficiency in using the fixed asset to generate return and
the higher the ratio, the higher the efficiency of the Bank in using its fixed assets. So,
after observing the given graph, I am able to say that the return from per unit of net
fixed assets is increasing from year to year, which is a good sign for the company –
JANATA Bank and the Bank should try to maintain the current level of performance for
its future betterment.
Investment to Deposit Ratio: It shows the operating efficiency of a particular
Bank in promoting its investment product by measuring the percentage of the total
deposit disbursed by the Bank as loan & advance or as investment. The ratio is
calculated as follows:

Investment to Deposit Ratio = Total General Investment/Total Accumulated Deposit

Table: Investments to Deposit Ratio
Name of ratio Years
2011 2012 2013 2014 2015
Investment to Deposit Ratio 79.98 80.62 101 91.97 93.18

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 (In percent)

Interpretation: As we know that the ratio measures the Bank’s efficiency in

promoting its investment product the customer and in using its funds collected from the
customers to by measuring the percentage of total deposit that the Bank has disbursed
as loan & advances and the higher the ratio the higher the Bank’s efficiency and vice-
versa. So, from the figure drawn above, we are able to say that, the Bank’s investment
to deposit ratio is fluctuating from year to year and in the year 2013 the Bank has
disbursed the highest amount of loan & advances, which is above 100% of the total
amount of deposit collected by the Bank in the same year and after the year 2013 the
Bank has disbursed on an average of above 91% of the total deposit collected by the
Bank in each year, which is good for the Bank

 Classified Investment to Total Investment Ratio: It measures the level of

classified investment (includes all those investment facilities where the irregularities
have occurred in terms of repayment of the investment) as percent of the total
investment, which is loan & advances. It is calculated as follows:

Classified Investment to Total Investment Ratio = Total Classified

Investment/Total InvestmentTable: xvi Classified Investment to Total
Investment Ratio

Table: Gross Classified Investment Ratio

NAME OF RATIO YEARS
2013 2014 2015
Gross Classified Investment Ratio (%) 2.20 1.89 1.80

Interpretation: As this ratio measures the level of classified investments, which are
problem loan for a particular Bank and the lower the ratio, the higher the efficiency of
the Bank in loan management. So after having a close eye on the figure drawn above,
we are able to say that the Bank’s efficiency is increasing year to year as the level of
classified investment is decreasing from year to year. So the Bank has a good hand in
loan management and should try further to reduce the level of classified investment
more, which will help them to increase their value in the mark

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Profitability Ratios: These ratios help us to evaluate the firm’s profits with respect to
sales, assets, or equity. These ratios tell a story about where the firm has been, not
where it is going. Ratios are:

 Net Profit Margin: It measures the percentage total operating income, that
remains after all the costs and expenses have been paid. It is calculated as follows-
Net Profit Margin = Net Profit after Tax/Total operating Income
Table: Net Profit Margin
Name of ratio Years
2011 2012 2013 2014 2015
Net Profit Margin 34.24% 30.31% 31.52% 34.46% 32.29%

Interpretation: we know that this ratio shows us the portion of total operating
income that remains after deducting all the costs and expenditure for particular period
of time. From the above graph, we can say that the company’s net profit margin is
fluctuating from year to year or over the time and the Bank has generated maximum
amount of net profit margin in the year 2014, which is 34.46% and lowest amount of
margin in 2012 which is 30.31%. So I can conclude that the Bank generates net profit
in each year on an average rate of above 31% of the total operating income.

 Return on Total Assets (ROA): It is also called Return on Investment (ROI) and
it measures the overall effectiveness of management in generating profit with its
available assets. It is calculated as follows
ROA = Net Profit after Tax / Total Assets

Table: Return on Total Assets (ROA)

Name of ratios Years
2011 2012 2013 2014 2015
ROA or ROI (%) 1.78 1.42 1.57 1.65 1.56
Interpretation: After having a careful view on the graph we are able to say that the
Bank’s effectiveness to generate return by using its available assets is fluctuating from
year to year and the Bank has generated maximum amount of ROE in the year of 2011
and due to lack of efficiency in utilization of assets the Bank’s ROE falls in the minimum
level in the year of 2012 and after the year 2013 the Bank’s ROE started to increase at

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a slow rate up to the year of 2014 but in the year 2015 the Bank’s ROE again started to
fall, as the Bank has introduced some new branches which has increased the Bank’s
non-interest expense

 Return on Equity (ROE): It measures the return earned by the funds invested by
the common stockholders. It is calculated as follows:
ROE = Net Profit after Tax/Shareholder’s Equity

Table: Return on Equity (ROE)

Name of ratios Years
2011 2012 2013 2014 2015
ROE (%) 36.53 34.53 27.27 29.04 20.90

Interpretation: The Company’s return on equity is decreasing over the time, which is
not good for the Bank. The JANATA Bank has generated maximum amount of ROE in
the year 2011, which is 36.53% but after that, the Bank’s ROE is decreasing from year
to year, which is not favourable for the EXIM Bank. The ROE is decreasing from the
year 2012 to year 2015 as the amount of proposed dividend and paid up capital of the
Bank has increased lot during this period of time but compare to that the amount of net
profit is not increasing that much for its higher provision.

7.0 Findings, recommendations and Conclusion

7.1 Findings
After analyzing discrepancy and working experience I come up with some findings.
 Technological growth is bit slowly.
 FDR service is almost same but they lack 3 year service.
 Management system is weak.

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 Employees of the JBL have limited experience and are not enough trained in some
cases
 No suitable desk for the interns.
 Absenteeism rate is high.
 Branch is not organized up to mark.
 Office equipment are obsoleted and it takes long time to replace

5.7 Recommendations
As per earnest observation some suggestions for the improvement of the situations are
given below:

7.2 Recommendations
 More diversifications should be made in investment as loan and advances.
 Amount Default loan and rate of defaulting should be decreased by introducing
proper investment mechanism.
 Janata bank needs to improve the technology. I have already shown the slow rate of
technological growth. For a service company, technological lacking brings huge
drawbacks. As I have mentioned the banking sofware issue, it need to overcome
from developing stage as quick as possible. Moreover, internet banking, full
functional online service needs to be launched so that they can get ahead of Sonali
bank.
 Bring Islamic banking as soon as possible. As i have mentioned earlier this bank has
already taken initiatives and got the permission for this service. So they should
complete the required procedure quickly to start this service.
 Improve the management structure so that loan service may improve. Since JBL is
facing this problem, branch official should tell higher authority. Five months vacancy
of manager post is not acceptable for a branch. So managerial decisions need to be
quicker. Otherwise, there is high possibility of malfunctioning the services.
 Proper training program should be applied to its employees. We all know that a
company’s reputation is highly effected with performance and behavior of its
employees. So appropriate training program is very important. Since many
employees are dependent on others to perform the task, it consumes time. However,
this is the most common scenario of a govt. bank. As a result, frequent training
program such as weekly basis could be a good step to reduce this issue.
 Bank officials need to give bit better service to the clients. Often I have seen rude
behavior by the officials, which is not necessary all the time. During official hours
different types and class of client interact with employees. Sometimes clients are

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 harassed due to officials own work or service failure. So I would recommend to
accept the fact and being more polite to clients.

7.3 Conclusion
Janata Bank Limited is the fastest growing State-owned Commercial Banks in
Bangladesh. For its outstanding performance it has won international award for a
number of times and consecutively for three years. In this report I briefly discussed
loan and advance. Loan and Advances occupy a very important position in modern
banking. A bank is a business enterprise of the country. It is a profit-seeking concern as
any other commercial and industrial organization. A bank cannot be benefited only by
taking deposits from public with finding proper avenues for investing them in profitable
venture now to boost up its standard of service, it is putting much more emphasis on
automation and new technology based product such as ATM, Ready Cash, Instant
Cash, etc. The bank is tremendously advancing in the field of import and export
financing. It is also financing the textile and jute sector and shrimp culture etc. But one
alarming thing is that as the bank do not ensure better salary and emolument to it’s
employees in comparison to the employees of the private banks, the trained manpower
of the bank go out in the hope of better salaries and other benefits. This practice
should be stopped by providing them with competitive salaries and other benefits and
training facilities. If the bank goes for further expansion in the profitable places with
profitable product such as merchant banking, the bank will be able to earn more profit.
It is mention worthy that in the year 2010 it has turned out to the highest profit maker
in Bangladesh by earning before tax profit of Taka 860 crore and it is the expectation of
all that the bank will be able to continue this trend in the coming years. We wish Janata
Bank Limited all the best.

References

Janata Bank Limited. (2017). In Services. Retrieved from:

http://bankinfobd.com/banks/26/Janata_Bank

Akhtaruzzaman, M. (2015). Developments of Islamic Banking Industry in Bangladesh

during April-June, 2015

Janata Bank Limited. (2017). In Branches. Retrieved from:

http://jb.com.bd/jb/about_us/branches

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Zeithaml, V. A., Bitner, M. J., Gremler, D. D., & Pandit, A. (2014). Services Marketing
(5thed.). Tata McGraw Hill Education Private Limited.

Janata Bank Limited. (2013). 2013 Annual Report of Janata Bank Limited. Retrieved
from:

http://www.janatabank-bd.com/annual/JBL_Annual_Report2013.pdf

Janata Bank Limited Q-Cash ATM Services. (2017). In ATM Services. Retrieved from:

http://www.janatabank-bd.com/atm-services/

Janata Bank Limited. (2017). In Services. Retrieved from:

http://jb.com.bd/jb/jbl_all_info/all_other_info/personalized_services/8

Janata Bank Limited. (2017). In Products. Retrieved from:

http://jb.com.bd/jb/products/scheme_deposit

Saha, S. (2009). Of changes and transformations: Bangladesh Bank (July 2009-June

2013)

Janata Bank Limited. (2017). In Products. Retrieved from:

http://jb.com.bd/jb/products/term_deposit

Janata Bank Limited. (2017). In Services. Retrieved from:

http://jb.com.bd/jb/jbl_all_info/all_other_info/one_stop_service/8

Report on Janata Bank Limited. (N.d.). Retrieved from:

http://www.assignmentpoint.com/business/report-on-janata-bank-limited.htm

Janata Bank Limited. (2017). retrieved from: http://www.janatabankbd.com/jbmap5.htm

Appendix – 1: Fields of Loans

Term loan / project loans in agro-based industries:

Processed fruit food (jam, jelly, juice, curry, syrup, syrup, sauce etc.); Fruits (tomato,
mango, sugarcane, guava, jackfruit, litchi, pineapple, coconut etc.); Vegetables, pulses
processing; Preparation of bread and biscuits, semai, laccha, chanachur, noodles etc.;
Preparation of flour, flour and sugary; Mushroom and spinelina processing; Art,
manufacturing, desktop, and other starch products; Drying process (milk pasteurization,
powdered milk, ice cream, condensed milk, sweet, cheese, ghee, butter, chocolate,
yogurt etc.); Processed food from potatoes (chips, potato flakes, stoves etc.);
Manufacturer; Different types of spraying spices are; Edible oil refining and

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hydrogenation; Liquid processing industry; Shrink and other fish processing and frosting;
Herbal and herbal medicines are manufactured; Eunani, Ayurvedic medicine making
industry; Artificial food-making industry for ducks, chickens and livestock and fish;
Processing and preserving seed; Textile makers (such as rope, yarn, twine, sacks, bags,
carpets, jute sandals etc.); Silk fabric manufacturing industry; Establishment, repair and
repair of machines for the production of agricultural products. Manufacture of rice,
pulse, chilli, pitcher etc; Sugary rice; The processing industry; Oil-producing industry (if
used in domestic coconut, is used in Copra); Rubber Tape, Laxman processing; Cold
storage (processing potatoes and seeds, potato, vegetables and vegetables);
Furnishings, bamboo and cane making / production (without cottage industry); Flower
preserves and exports; 28 Meat processing organization; Organic fertilizers, mixed
fertilizers, gut urea etc.; Biopsychiaide, neem production pesticide, etc.; Bees cultivation/
honey making project; Market-making projects; Patial Board.

Term / project loan in priority sector:

Computer software and information and technology industries Electronics 3 Artificial
flower production 4. Export-oriented frozen food 5 Pusup cultivation 6. High material 7
Export-oriented leather products 8 Export-oriented jute goods 9. Juvenile and diamond
cutting and polishing 10. The sub-sectors of oil and gas industries, namely- LPG b. CNG
11 Cotton cultivation and silk industry 12. Khilna 13. Apart from the garment factory, the
sub-basins of the textile industry,

Terminal / project loan in export-oriented industries:

For loans in the following industrial subdivisions under Thrust Sector (Priority): 1 Agro-
products and agro processing products, 2 Light engineering products (including auto
parts and bicycles), 3 Shoes and leather products, 4 Pharmaceuticals products, 5
Software and ICT products, 6. Home textile, ocean-going ship building industry and 8.
Toiletries products.

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