Overview and Contribution of Agrani Bank Limited On Green Banking

Internship Report
on
“Overview and contribution of Agrani Bank
Limited on Green Banking”
Prepared For
Department of Banking and Insurance
University of Dhaka
Supervised By
Professor Md. Abu Taleb
Chairman
University of Dhaka
Submitted By
Easmin Akter
ID: 19-005
Batch: 19th
Program: BBA
Faculty of Business Studies
Submission: 30th march, 2017

University of Dhaka
Supervisor’s Certificate
This is to certify that the Internship Report on “Overview and contribution of Agrani Bank
Limited on Green Banking”in the bona fide record at the report is done by Easmin Akter as a
partial fulfillment of the requirement of Bachelor of Business Administration (BBA) degree from
the Department of Banking & Insurance, University of Dhaka.
The Report has been prepared under my guidance and is a record of the bona fide work carried
out successfully.
…………………………………….
Signature of the Supervisor
………………………….
Date
DECLARATION
I do hereby solemnly declare that the work presented in this Internship Report has been carried
out by me and has not been previously submitted to any other University/ College/ Organization
for an academic qualification/certificate/diploma or degree.
The work I have presented does not breach any existing copyright and no portion of this report is
copied from any work done earlier for a degree or otherwise.
I further undertake to indemnify the Department against any loss or damage arising from breach
of the foregoing obligations.
……………………………………..
Signature of the Student
ID No:
Batch:
…………………………..
Date
Letter of Transmittal
Honorable Sir,
It’s really pleasure to work on this topic“Overview and contribution of Agrani Bank Limited on
Green Banking” which contains all the practical information.
This report will help to know about the Green financing through Green Banking of Bangladesh,
especially Green banking of Agrani bank Ltd. I have tried my best to make this report more
informative and flawless. Hope you will be kind to consider the strengths and weaknesses, so I
will be more adequately encouraged to write better on this type of topic next.
Expecting to make the paper use of the knowledge I have gained from this part of career
purpose in the practical world.
Thank you for all your guidelines and co-operations.
Best regards
Easmin Akter
ID: 19-005
Banking and Insurance
University of Dhaka.
Acknowledgement
The almighty’s blessing helped to accomplish this report working. His given Conscience helped
to choose the logical judgments and to select the right one.
Gratitude to my supervisor Professor Md, Abu Taleb, Chairman of Department of Banking and
Insurance, University of Dhaka, who supported me throughout my internship. His supervision
and guidelines helped me most to complete this report in right and informative way.
And I’m thankful to the manager of Agrani Bank, Malibag Branch and Md. Kayes, senior officer
and all other officials of this branch to co-operate me as their intern and for providing me all
the necessary information, data and guidelines.
This report containing Green Financing through green banking helped me to understand the
practical scenario of this area. I have got such valuable information that can take my knowledge
to a new arena of business world. All the analysis and document are grounded on latest original
information that can give a clear view on green finance as well as green banking. Finally I want
to express my pleasure for getting opportunity to present an intern experience on this topic.
Executive Summary
Main purpose of this report is to find out the aspects of green banking, overview of green
finance, Steps taken by regulatory authorities to enhance green financing. Beside these other
crucial factors are the effects of green banking on environment, green financing activities taken
by Bangladesh Bank. Here I have presented the existing condition of Agrani Bank Limited,
contribution made byAgrani bank in green financing. Also includes the growth of online and
mobile banking latest condition of this area, judgements and Commendations.
Data, Information and all other necessary ingredients are collected from latest articles on Green
Finance and Green Banking. Annual report of Agrani Bank Ltd. provided data too. Here internet
subscription helped a lot to find out the up to date situation, graphical presentation, tables and
charts information. So this report can be significant one.
I have come to an ending point after analyzing this report are thatAgrani Bank Ltd. is
maintaining all the regulations and guidelines of Bangladesh Bank to ensure green business
environment. Beside this some other findings are that45 banks have formulated policy for
green banking. 46 banks have formed a Green Banking unit. 41 Banks have introduced a Green
Office Guide. 13,833 risk rated prefects have been financed. 13, 07,479.64 million taka has been
disbursed. 212 Branches and 150 SME Units/ATM booths are powered by solar energy. 37
banks are fully automated. And 3226 branches have been facilitated with online coverage.
These qualitative and quantitative presentations may help to have a look and get acquaintance
over Green Banking and Green Financing.
Table of Contents
1. Introduction .......................................................................................................................................... 1
1.1 Objective of the Study: ....................................................................................................................... 1
1.2 Methodology of the report: ............................................................................................................... 2
1.3 Rationale of the Report ................................................................................................................ 2
1.4 Limitation of the Report............................................................................................................... 2
2. Overview of Agrani Bank ..................................................................................................................... 3

3. Industry Information and Analysis .................................................................................................... 10
3.1 Green Banking ................................................................................................................................... 10
3.3 Implementing Green Banking Policy: .......................................................................................... 12
3.4 Branches and ATM/SME Units (Solar Powered) ............................................................................... 14
4. The global context .............................................................................................................................. 21

5. Green Finance for Developing Countries........................................................................................... 22
5.1Key concerns of developing countries: .............................................................................................. 23
5.2 Action by developing countries: ....................................................................................................... 23
5.3 Specific needs of developing countries: ........................................................................................... 24
7. Latest condition...................................................................................................................................... 31
8. Commendation ...................................................................................................................................... 34
10.References ............................................................................................................................................. 37
Table of Tables:
Table 1 Corporate Profile .............................................................................................................................. 3

Table 2 Financial Highlight ............................................................................................................................ 9
Table 3 Allocation of fund for green financing ........................................................................................... 11
Table 4 Major banking activities ................................................................................................................. 11
Table 5 solar power branches and ATM/SME............................................................................................. 14
Table 6: Green Finance ............................................................................................................................... 15
Table 7 Utilization of Climate Risk Fund ..................................................................................................... 16
Table 8: Online Banking .............................................................................................................................. 17
Table 9: Allocation of green finance ........................................................................................................... 24
Table 10: Refinancing scheme .................................................................................................................... 25
Table 11: Allocation and Utilization of fund ............................................................................................... 26
Table 12: Sector and Disbursement ............................................................................................................ 30
Table of Figures:
Figure 1: BB Refinance Scheme................................................................................................................... 25

Figure 2: Disbursement ............................................................................................................................... 30
Overview and contribution of Agrani Bank Limited on Green Banking
1. Introduction
Global warming is now an overused term that creates concerns for the last few decades.
Developing countries like Bangladesh have been suffering from many types of natural
calamities because of the green house effect. The world leaders have been giving more priority
on the alleviation of green house effects. Some big organization like United Nations, IMF, World
Bank, Asian Development Bank have been urging developed countries to be more effective in
burning oxygen. Because of these developed countries, developing countries have been facing
the consequences. Bangladesh has been taking numerous steps to mitigate the effects of global
warming. Loaning to institutions that are green friendly is one of them. To be more proactive,
Bangladesh Government and Bangladesh Bank have given priority green banking along with
other economic matters.
1.1 Objective of the Study:
The aim behind making of this internship report is to identify and learn about:
 Aspects of green banking

 Overview of green finance
 Green financing activities taken in developing countries.
 Steps taken by regulatory authorities to enhance green financing
 Effects of green banking on environment
 Green financing activities taken by Bangladesh Bank
 Current situation of Agrani Bank Limited
 Contribution made by Agrani bank in green financing
 Online and Mobile banking
 Latest condition of this area
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 Judgments and Commendations
1.2 Methodology of the report:
The report starts with the collection of data about green banking from different sources. Then
collected data is analyzed to determine what institutions are giving priority to green financing in
terms of amount. The analysis further goes towards to the determination of whether green
banking budget targeted by banks and financial institutions is sufficed or not.
The report is completed using data and information taken from different sources.
Primary Sources:
 Direct interaction with Bank officials
Secondary sources:
 Bangladesh Bank periodic report

 Agrani Bank annual reports
 Research articles
 Newspapers
1.3 Rationale of the Report
The reason behind the completion of this internship report is to determine whether the banks
and financial institutions are giving more priority on the climate change and its consequences
and what are the lacking that are making alleviation of global warming more efficient.
1.4 Limitation of the Report
The main limitation of the study is the absence of the previous year annual report of Agrani
Bank. The website of Agrani Bank gives little information about the topic.
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2. Overview of Agrani Bank
Agrani Bank Limited was incorporated as a state owned commercial bank on 17 May 2007
under the Companies Act 1994. Agrani Bank emerged as a national commercial bank following
the Bangladesh Banks Order 1972. On a going concern basis ABL took over the business, assets,
liabilities, rights and obligations of Agrani bank through a vendors agreement signed on 15
November 2007 between the ministry of finance of the Peoples Republic of Bangladesh and the
Board of Directors of ABL with retrospective effects from 1 July 2007.
Corporate Profile:
Table 1 Corporate Profile
Legal status Public Limited Company

Shareholder 100% share owned by Government
Registered office 9/D Dilkusha, Dhaka 1000

Authorized capital Tk. 2500 crore
Paid up capital 2072 crore
Tax Identification No 0022001223
Circle Office 11
Corporate Branch 27
Branches 921
Zonal Office 62
Foreign correspondent 328
Credit Rating AAA by CRISL
SWIFT code AGBKBDDH
Website www.agranibank.org
E-mail agrani@agranibank.org
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Products and Services:
1. Deposit
a) Taka account
 Current Deposit
 Savings Deposit
 Fixed Deposit
 Special Notice Time Deposit
 Non Resident Special Taka Account
 Pension Scheme Students Saving Account
 Small Life Insurance Policy Holders
 Ten Taka farmers
 Freedom Fighter
B) Foreign Currency Account
 Foreign Currency
 Non Resident Foreign Currency
 Exporters Retention Quota
2. Loans and Advances
a) Continuous Loan
 Cash Credit (Hypo)

 Cash Credit (Pledge)
 Secured Overdraft (SOD)
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b) Term Loan
 Industrial Credit
 Housing Loan
 Consumer Credit
 Weavers Credit
c) Rural and Agro Credit
 Crop Loan
 Fishery Loan
 Animal Husbandry Loan
 Agro Machinery Loan
 Rural Transport Loan
 Swanirvar Loan
 Poverty Alleviation Loan
d) Small and Medium Enterprise Loan
 Service Sector Loan

 Trading Sector Loan
 Manufacturing Sector Loan
 Women Entrepreneurs Loan
e) Import Finance
 Loan Against Imported Merchandise

 Loan Against Trust Receipt
 Loan Against Document
f) Export Finance
 Export Cash
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 Packing Credit
 Local / Foreign Bills Purchased
 Export Development Fund
3. Treasury
a) Money Market
 Maintaining CRR and SLR

 Call Money Transaction
 Term Placement
 Treasury Bills
 Treasury Bonds
 Repo
 Reverse Repo
 Custodian Services
 Other Investment
b) Foreign Exchange Market
 Selling Foreign Currency for Import Payment

 Buying Foreign Currency against Export Proceeds
 SWAP Transaction
 Forward Transaction
 Term Placement
4. Letter of Credit
 Letter of credit (Sight)

 Letter of credit (Usance)
 Back to Back L/C
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5. Letter of Guarantee
 Advance Payment Guarantee

 Bid Bond
 Performance Guarantee
 Shipping Guarantee
 Standby Credit
6. Other Foreign Exchange Services
 Issuance of Draft
 Collection of Draft
 Foreign Remittance
 Documentary Bill Collection
 Advanced Payment for Import & Export
7. Cash Service
 ATM Service
 Cheque Encashment
 Foreign Currency
8. Fund Transfer
 Inter Branch Money Transfer

 SWIFT
 Telegraphic Transfer
 Issuing Foreign Draft
 Bangladesh Electronic Fund Transfer Network
 Online Deposit to Accounts
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9. Value Added Service
 Locker Service
 Utility Bill Collection
 Arm forces Pension Payment
10. Merchant Banking Service
 Issue Management
 Underwriting
 Portfolio Management
 11. Islamic banking Service
11. Islamic Banking Service
a) Deposit
 Al WadiahCurrent A/C
 Mudaraba Savings A/C
 Mudaraba STD A/C
 Mudaraba Term Deposit
 Mudaraba Special Scheme Deposit
b) Investment
 Bai Murabaha (Pledge)

 Bai muazzal (Hypo)
 Higher purchase ShirkatulMeilk
 Bai Sal
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Subsidiary Companies of ABL
1. Agrani Equity & Investment Limited

2. Agrani SME Financing Company Limited
3. Agrani Exchange House Private Limited, Singapore
4. AgraniRemmitence House Sdn. Bhd, Mlaysia
5. Agrani Exchange Company ,Australia
6. Agrani Remittance House, Canada
Financial Highlights
Table 2 Financial Highlight
Particulars 2015 2014 Change

Interest Revenue 2363.54 2339.48 1.03%
Interest Cost 2294.28 2220.9 3.30%
Net Interest Revenue 69.26 118.59 -41.60%
Income from Investment 1495.24 1301.11 14.92%
Other Operating Revenue 427.07 530.26 -19.46%
Total Operating Revenue 1991.57 1949.96 2.13%
Profit Before Tax -59.89 170.49 -135.13%
Net Profit After Tax 65.31 198.61 -67.12%
Paid Up Capital 2072.29 2072.29 0.00%
Total Shareholders' Equity 4467.59 3956.66 12.91%
Deposits 43997.55 38392.19 14.60%
Loans and Advances 24480.18 23508.57 4.13%
Amount of Classified 4640.41 3965.95 17.01%
Investments 20569.75 15227.98 35.08%
Fixed Assets 1594.95 1544.72 3.25%
Total Assets 56535.15 49487.08 14.24%
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3. Industry Information and Analysis
3.1 Green Banking
Green Banking is defined as promoting environmental-friendly practices and reducing carbon

footprint from banking activities. Green banking involves two split approach.
 Green banking focuses on the green transformation of internal operations. Means all
the banks should acceptsuitable ways of utilizing renewable energy, automation and
other trials to abate carbon footprint from banking activities.
 Banks should accept environmentally responsible financing.Mostly Green banking
exposure includes: Sustainable banking, Green mortgages, Green loans, Green credit
cards, Green savings accounts, Green checking accounts, Green money market
accounts, Mobile banking, online banking, Waste Management, Roof Gardening, and
Green Financing.
Fund allocation of Green Banking:
Banks are required to allocate a considerable amount for green banking in their annual
budgets, which will include
(a) Financial plan for green finance
(b) Financial plan for Climate Risk Fund and
(c) Financial plan for marketing & capacity building. Survey shows that 35 banks allocated Tk.
23,018.36 million in their annual financial plan for 2012. Per bank allocated Tk. 657.67 million
for green banking in 2012.
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Allocation of fund for Green Banking
Table 3 Allocation of fund for green financing
Area of allocation Amount (in million Tk.)
Green Finance 20,034.59
Climate Risk Fund 2,141.74
Marketing& capacity building 842.73
Source: Bangladesh Bank
3.2 Foremost Green Banking Activities at a Glance in October-December, 2016
Table 4 Major banking activities
Subject Bank FI
Banks/FIs having Green 56 32
banking unit
Banks/FIs with Green banking 56 32
policy
Banks/FIs with Green office 56.00 32
guide
Ecological risk rated schemes 17,911 577
Environmental risk rated 15,061 653
schemes and financed
Amount paid for rated 578,382.43 27,015.28
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schemes
Solar powered branches 522 3
Solar powered ATM/SME 252 2
units
Online branches (as per % of 72.72% N/A
total branches)
Amount paid for green 132,253.22 3576.70
finance
Direct green finance .63% 2.03%
Amount for climate risk fund 314.90 .51
Amount for green marketing, 6.40 .21
training and advance
3.3 Implementing Green Banking Policy:
Banks are required to employ a comprehensive green banking practices in line with the global
standards in order to protect environmental negative consequences and to sustain the
environment. BB has formulated a structure to employ structured green banking policy and
practices for the development of green banking in Bangladesh.
Three phases of time frame work include the following:
Phase-I
Banks are required to take actions under this stage in order to develop the green banking
policies within 31st December, 2011 and the actions to be taken are:
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 Formulation of Policies and green governance
The upper level management is mainly responsible for the implementation of the formulation
of policies and procedures relating to green banking. The upper level management includes
Board of Directors, Committee such as audit committee, risk management committee,
executive committee, committee consisting of regional managers and in case of foreign banks,
CEO. It is recommended that the green banking policy implementation needs a substantial
amount of fund.
Every bank in Bangladesh is required to establish a Green banking desk or unit whose
responsibility would be to formulate, design, implement green banking policies and procedures.
They are also responsible for maintaining sustainability in green banking practices in line with
the global context along with the Bangladesh Bank’s policies and guidelines. Board of Director
or Managing Director will chose a senior executive whose responsibility is to operate the green
banking unit as head and report the performance of the unit periodically to the committee.
 Incorporation of Environmental Risk in CRM

In order to assess a prospective borrower, bank shall harmonize between environmental risk
and climate change risk which are part of existing risk methodology which will consist of
integrating environmental risks in the checklists and audit guidelines. Possible source of
environmental risks will be removed through that manner.
 Initiating In-house Environment Management
While initiating in-house environment management, the first task would be to construct a
statement regarding the consumption of water, paper, energy and electricity. And after that,
banks should take steps to maintain optimal use of electricity, water, and energy. It is required
to supply the bank’s policies towards green banking and use of energy to all the employees.
Banks can use Eco-font in printing to reduce use of ink, use scrap paper as notepads to become
more eco- friendly. They can reduce the consumption of electricity through automatic
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shutdown of computers, lights, fans, ac etc. It is recommended that banks should use solar
energy to save electricity.
3.4 Branches and ATM/SME Units (Solar Powered)

Table 5 solar power branches and ATM/SME
Banks/Fis (in terms of Branches Solar powered Solar powered ATM/SME

ownership) branches units
State-owned commercial banks 3726 42 1
Specialized banks 1410 0 0
Private commercial banks 4552 477 246
Foreign commercial banks 72 3 5
Total 9760 522 252
 Introducing Green finance
Banks must given priority on providing finance to eco-friendly entrepreneurships and to

industries that use optimal energy in their businesses. Some preferences under thses segments
are:
 Renewable energy project,

 Bio-fertilizer plant need to be encouraged
 Wastewater treatment plant,
 Clean water supply project,
 Solid &hazardous waste disposal plant,
 Bio-gas plant,
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Green Finance
Table 6: Green Finance
Banks/FIs Direct Green Finance Indirect Green Finance Total Green Finance
SOCBs 302.24 861.42 1163.66
SDBs 1.39 0.00 1.39
PCBs 10,018.30 102,546.15 112,564.45
FCBs 172.52 23,351.20 23,523.72
Total 10,494.45 126,758.77 137,253.22
FIs 1461.69 2115.01 3576.70
Grand Total 11,956.54 128,873.78 140,829.92
 Supporting Employee Training, Consumer Awareness and Green Event
It is HR department’s responsibility to educate and make aware of green banking activities and
green financing to every employees from newly employed to existing employees. Consumers
should be aware of the greener aspects of products and its impact on environment. Banks
should participate in fairs related to green banking to promote the green banking and green
financing.
 Creation of Climate Risk Fund
Climate risk fund should be created by each bank that will provide finance to the areas that are
often affected by natural calamities like cyclone, flood, drought, excessive raining etc. the
people of these areas should be facilitated with finance at a regular rate without any additional
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risk premiums. In order to protect its stake, a bank should conduct analysis on probability of
risk of giving financing in a certain danger area. This climate risk fund is treated as a CSR
activity.
Utilization of Climate Risk Fund

Table 7 Climate Risk Fund
Type of Bank/FI Event Project
SDBs (02) 0.00 0.00
SOCBs (06) 2.50 0.00
PCBs (39) 281.74 0.00
FCBs (09) 0.00 30.66
Total 284.24 30.66
FIs (33) .35 .16
Grand Total 284.59 30.82
 Introducing Green Marketing
Green marketing denotes the selling of products and services that represents the
environmental benefit. Banks and financial institutions should market those products that are
environmental friendly; they help reduce pollution and sustain environment and it should be
the utmost concern of today’s financial service businesses. Marketing of products in green way
includes:
 Product modification based on environment
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 Modification in production process

 Reduction in the use of plastic in packaging products
 Variation in advertisements.
 Online Banking
Online banking is such a great innovation that helps the clients receive banking services via
internet. Virtually everyone can be facilitated by way of extensive conventional procedures,
extensive use of paper works. Customers are to be encouraged to do online banking that will
sustain the environment along with customer satisfaction. It is now a bank’s moral duty to save
environment from further waste through implementing such activities that will save gas and
carbon emission along with the reduction of printing and postal costs.
Online Banking (on December 31, 2016)

Table 8: Online Banking
Type of Bank Branch No. Branches with Online % of Online Branches

coverage
SOCBs (6) 3726 2279 61.16%
SDBs (02) 1410 152 10.78%
PCBs (39) 4551 4551 99.98%
FCBs (09) 72 72 100.00%
Grand Total 9760 7054 72.27%
Phase-II
Every scheduled and non scheduled bank is required to implement the actions under this stage
within 31st December, 2012 and the actions to be taken are:
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 Sector Specific Environmental Policies

Banks are required to design and implement such policies that cover every sector which
is proved environmentally sensitive. Such sectors are:
1. Agriculture 7. Fisheries
2. Agri-business 8. Renewable energy
3. Garments or Apparels 9. Construction and housing
4. Poultry and Dairy 10. Pulp and paper
5. Agro-farming 11. Chemicals
6. Leather 12. Rubber & Plastic industry
7. Pharmaceuticals 13. Hospital or clinic
8. Brick manufacturing 14. Chemical trading
9. Ship breaking 15. Mining etc.
 Green Strategic Planning

It is obligatory that every bank should establish a set of goals and objectives that are
specific, measurable, attainable, relevant, and timely basis. In addition, banks must
disclose these objectives in their annual report and periodical reports. Most common
target area is to achieve efficiency in:
 Renewable energy
 Lessening of electricity, gas, and energy consumption
 Reduction in green house gas
 E-payment system
 E-statement issuance
 Saving papers
 Establishing office in an environmental friendly way
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The target areas that should be established for green financing are:
 Sanctioning of loans and advances to environmental friendly business and
entrepreneurships.
 Reduction of loans to hazardous activities
 Obtaining a good ratio of environmental loan to total loan portfolio.
 Introduction of eco-friendly financial products.
 Substantive programs to educate customers
Banks should promote environmental friendly living practices among their clients; they should
be encouraged to take loans in order to invest in such activities that help reduce environmental
calamities and sustain environmental system. They should be encouraged to invest in such
sectors that use less energy with desired output. Educating entrepreneurs is an utmost need to
further the green banking development.
 Setting up Green Branches
Every bank should establish some green branches that should be a representative of:
 Maximum use of natural light

 Optimal use of water, electricity and other energy
 Usage of energy saving bulbs
 Use of recycled water etc.
A special logo that represents green banking is entitled to use by a green branch approved by
BB.
 Improved In-house Environment Management
Banks internal environment should be such that it is capable of reusing the water and other
energy, and it will be a source of pollution reduction. It is required that in-house environmental
management in this stage consists of the strategy of waste minimization. In order to reduce the
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cost along with the reduction of natural resources, banks are motivated to engage in video
conferencing rather than physical interactions.
 Formulation of Bank Specific Environmental Risk Management Plan and Guidelines
In line with the national regulation, banks should concentrate on internationally developed
benchmarks. In valuation and examining of projects, banks should formulate rules and policies
relating to ERM (environmental risk management). It will offer competitive advantage if green
banking initiatives are taken by banks over others.
Phase-III:
Introducing innovative products and designing them in the way to go green and presenting the
informational condition with the verification of external are done in third stage of policy
implementation. Environmental Management system is needed here before the
commencement of the actions of Phase-III.
The total eco-system through eco-friendly ingenuities and introducing innovative products
should be done by banks.
 Scheming and Presenting Innovative Products

Banks are bound to introduce environment friendly innovative green products to go green and
to address the core environmental challenges of the country. Positive banking activities can
ignore the negative aspects to environmental changes. Innovative products that are helpful for
green bankrolling can play an important part here. These will help to go green in banking world.
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 Presenting in Standard Design with External Verification
Green Annual Report should be published by ensuing international standard arrangement like
Global Reporting Initiatives (GRI). Stakeholders are crucial in reporting task. Independent
authority is expected to verify all the data, information, graphics and quantity presentation to
ensure the actuality and veracity. This concerned authority need to follow an internationally
accepted procedure for the ultimate accuracy as well as dependence.
4. The global context
“Without necessarily naming it ‘green’, some day in the future all finance will be green. At the
same time there are barriers to green finance which are more generally about attracting and
allocating capital. So when we talk about green finance we are really talking about
strengthening our core financial systems.”
UnenbatJigjid, Mongolia Bankers Association
“The aim is not to convert the whole economy to ‘green’ all at once, but to accelerate the move
from one side to the other. Leadership must come from the private sector, business community
and NGOs, not only from the officials. We need a comprehensive and coherent framework
supported by political will that enables market forces to move businesses from the traditional
to the green economy.”
Mohammed Omran, Egyptian Stock Exchange (EGX)
“Green finance is burgeoning, it has reached a point of spontaneous combustion. But it needs
to be aligned. It needs to go beyond the leadership of a few champions and it needs to be
coordinated across regional trading blocks.”
NuruMugambi, Kenya Bankers Association
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Green Finance
Strategy for financial sector and broader sustainable development that is pertinent around the
world. This context differs noticeably for different countries. Developing countries, notably
those with underdeveloped financial systems, face individual challenges in financing national
development priorities.
5. Green Finance for Developing Countries
Sustainable development is concentrated in three areas:
Thwarting the financing of illegal practices or profiting from frail enforcement: Here
environmental, economic and social policies and guidelines may lead to conflicts and market
impacts and to lose lenders, investors, and even macroeconomic constancy risks.
Exposing opportunities for green investment: In many countries, opportunities for green
finance in renewable energy, agricultural development and Small and Medium-sized
Enterprises (SMEs) output. And here insurance markets may commercially feasible but
faceblockades in demand or supply.
Exploring solutions to impasses and trade-offs: Generally developing countries face a

tightness in case to expand the electricity supply and reduce fossil fuel intensity. SME finance is
an area where regulators must be careful about lending requirements.
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5.1 Key concerns of developing countries:
Integrated approach – It ishighlighted that environmental factors in financing be addressed in

conjunction with economic and social issues and priorities, in particular access to finance for
SMEs.
Dilemmas, gaps and trade-offs – International measures to promote appropriate green
financing of the transition to a green economy should not come at the cost of developing
countries’ competitiveness, equity, development and financial inclusion.
Impacts of international developments – Developments in the international financial system,

including those in major national financial centres, impact on developing countries positively
and negatively. This makes G20 country deliberations and actions a key matter for all
developing countries seeking to achieve sustainable development.
5.2 Action by developing countries:
National collaboration – National strategies and road maps for aligning financial system
development with the needs of sustainable development are being elaborated in a number of
countries involving public and private actors, and combining market-driven approaches with
policies, regulations and standards. These processes are critical to reduce reliance on
pioneering individuals or institutions.
Disruptive potential – New business models across the financial system, such as those enabled
by mobile money and blockchain ledgers, offer the potential for ‘leapfrogging’ that can drive
more inclusive, green financial market developments. These could be promoted while
recognizing the need to ensure the integrity and robustness of financial markets.
23
5.3 Specific needs of developing countries:

Inward direct investment – A key challenge is how to support long-term green finance
effectively in advance of mature local bond markets developing. This may include blended
finance approaches, drawing on public institutional investment vehicles and integrating green
finance considerations into foreign direct investment, as well as pioneer issuance of green
bonds.
Allocation of Green Finance

Table 9: Allocation of green finance
Bank category Bank Category Utilization(January- Percentage of

Allocation for year September 2012) utilization
2012
SCBs 6,160.00 25.53 0.41%
PCBs 11,506.79 2,828.73 24.58%
FCBs 1,017.80 76.80 7.55%
SDBs 1,350.00 342.63 25.38%
Total 20,034.59 3,273.69 16.34%
24
Bangladesh Bank refinance scheme for promotion of green projects

Table 10: Refinancing scheme
Category Amount (in million Taka)
Solar irrigation pump 23.9
Solar home system 87.8
Biogas plant 262.7
Effluent Treatment Plant (ETP) 90.4
Hybrid Hoffman Kiln (HHK) 124.8
Solar irrigation pump

Refinance 4%
Hybrid Hoffman
Kiln (HHK) Solar home system
21% 15%
Effluent Treatment
Plant (ETP) Biogas plant
15% 45%
Figure 1:BB Refinance Scheme
25
Distribution and Use of Fund for Green Banking Activities

Table 11: Allocation and Utilization of fund
Distribution of Fund, Use of Funds,

2016 (in million Taka) October –December2016 (in million Taka)
Bank Green Climate Marketing Total Green Climate Marketing Total

Finance Risk and Finance Risk and
Fund Capacity Fund Capacity
building building
SOCB 14,745.25 150.5 397.75 15,293.50 1163.66 2.5 0.09 1166.26
SDB 60 0.2 0.1 60.3 1.39 0 0 1.39
PCB 318,278.63 456.32 289.4 319,024.35 112,564.45 281.74 6.31 112,852.52
FCB 100,048.93 157.65 65.4 100,271.98 23,523.72 30.66 0 23,554.54
Total 433,132.81 764.67 752.65 434,650.13 137,253.22 314.9 6.4 137,574.52
FLs 25,687.48 50.99 26.34 25,764.81 3576.7 0.51 0.21 3577.41
Grand 458,820.29 815.66 778.99 460,414.94 140,829.92 315.41 6,61 141,151.93

Total
26
6. Green Banking of ABL
Its 2011 from when Agrani Bank has been doing green banking forming a “Green Banking Unit”
under its Rural Credit Division. Several green financial products already launched to facilitate an
eco-friendly financial atmosphere in the country.Within December 2014 to implement 1 st and
2nd phase ABLdone necessary steps. Following effective measures for green banking:
a) Green Banking Committee: A green Banking Committee has been formed comprising
nine divisions of head office.
 Rural Credit Division
 Industrial Credit Division
 SME Credit Division
 Card Division
 Credit Policy and Credit Risk Management Division
 Central Accounts Division
 IT and MIS Division
 Planning, Marketing Division
 HR training Development Division
b) In-house Green Banking: ABL have now internet connectivity in all branches which
enables the bank to aim easy use of BACPS, BACH & BEFTN. IN ABL now total number of
online branches is 309.
Much ingenuityhas been taken for in-house environment management outlining the clean
indication for maintaining a green office. Initiatives are taken:
i. Use of paper for internal use.
ii. Use of online communication.
27
iii. Daylight working can be more helpful instead of electric lights. And another thing is to use
ventilation instead of using air conditioning.
iv. Eco Font for printing light impression on both sides of the paper.
v. Video/Audio meeting instead of corporeal travel.
Vi. Use of printer cartridges, photocopy toner, office stationary, etc.
vii. E-mail in lieu of paper memos.
c) Set up of Green Branch: All the branches of ABL will be included under green banking.
Dinajpur, Bogra, Thakurgaon has been surveyed aiming to convert them into a green branch.
d) Awareness of eco-friendly banking: Tk.1 crore yearly has been billed to create cognizance
and willingness among the public about green services and products of ABL. It supports
green events like campaigns, sponsoring educative program on environment, sponsoring
tree plantation etc.
e) Green Office Guideline: Following this “Green Office Guideline” would enable the staff
members of ABL for efficient use of electricity, fuel, water paper and to rescue of utensils.
f) Roof Top Gardening: Unplanned suburbanization and extreme building of high-rise
structure the open space is waned, the cultivated land is reduced, green trees are decreased
and the consequence is the rise of temperature. The result is the temperature of urban area
which is more than 80° C from the rural area. By introducing of RTG the temperature can be
reduced approximately 2° to 30° C. The main purposes of RTG are to trim down the
temperature and utilize the barren or open space of roof.
28
g) Recyclable Product: ABL has taken edge to survey on recyclable product:
1. Yield reusable paper from waste paper recycling plant.

2. Plastic waste recycling plant.
3. Decomposable bags manufacturing plant.
4. Recyclable poly-propelin threat and bags manufacturing plant.
5. PET bottle.
6. Solar battery.
7. Municipal garbage.
h) Online Banking: ABL have now internet connectivity in all branches which enables the
Bank to avail easy use of
 BACPS (Bangladesh Automated Cheque Processing System)
 BACH (Bangladesh Automated Clearing House)
 BEFTN (Bangladesh Electronic Fund Transfer Network). Online banking is an
important element of green banking strategy of ABL which has started in the
Bank from 1st July 2010.
i) Green Marketing: ABL have marketing products and services grounded on
environmental factors and awareness. The Bank now advertising the products, notice,
circular etc. through internet media.
j) Climate Risk Fund: Bangladesh Bank has instructed the scheduled banks to introduce
contract farming system in their credit activities. Tk.4 crore has been created at a lower
rate of interest or without interest to assist two types of projects, one is to support
projects which might be affected fornatural calamities and the next is to promote the
29
projects like forestry, embankment, pure drinking water etc. ABL has CSR fund for social,
educational, cultural and environmental advancement.
Table 12: Sector and Disbursement
Sectors Disbursement
No Amount (In Lac)
1. Solar panel 222 113.15

2. Easy bike 638 495.42
3. Bio Gas 133 585.59
4. Hybrid Hoffman Kiln Brick Field 20 1899.18
5. Vermi-compost 79 39.5
Total 1092 3132.84
39.5 113.15 Disbursement

1. Solar panel
495.42
Easy bike
Bio Gas
585.59
1899.18
Hybrid Hoffman Kiln Brick
Field
Vermi-compost
Figure 2:Disbursement
30
7. Latest condition
 BB signs deal with six banks for green financing
Bangladesh Bank (BB) signed separate agreements with six private banks to facilitate long-term
financing under the Green Transformation Fund for export-oriented textile and textile products and
leather manufacturing industries.
Under the agreements, the six banks would provide long-term financing for transforming the export-
oriented industries into green manufacturing units, reports BSS. The banks are
1. Eastern Bank,
2. Jamuna Bank,
3. Mercantile Bank,
4. Prime Bank,
5. ShahjalaIslami Bank and
6. South East Bank.
Tribune Business Desk
Published at 12:01 AM December 02, 2016
 One more product to get green refinance as BB revises policy
Financial Express Report
Bangladesh bank has incorporated one more product -- Green Building Featuring -- in its list of
products eligible for getting refinancing facilities under the green initiatives.
It also revised the interest rates on loans from the refinance scheme.
31
The Bangladesh Bank (BB) issued a circular in this connection asking the chief executive officers
and managing directors of the commercial banks to follow the instructions for refinancing the
green products.
Now the number of green products stood at 51after including the new one. The products are
eligible for getting loans from the refinance scheme of the central bank.
Under the revised interest rate policy, the banks and non-banking financial institutions have
been allowed to charge interest at a range between 9.0 per cent and 8.0 per cent instead of
existing highest rate of 9.0 per cent.
"The interest rates will be fixed considering the tenure of refinance," a senior official of BB told
the FE.
He said it will help encourage the interested borrowers to avail of such refinancing facility from
the banks and NBFIs.
Published: 16 Mar 2017
Financial Express
 Green Banking for Sustainable Energy
Dr. Toufic Ahmad Choudhury, Director General of Bangladesh Institute of Bank Management
(BIBM), said sustained finance can be achieved throughsustainable development. The
organization promotes green banking and sustainable development in the country. BIBM is
providingschooling, training and research programme.
He said, the BIBM at the instruction of the Bangladesh Bank has designed need-based
programmes for green banking and taken a number of research initiatives on green banking.
32
The BIBM offers training workshops for bankers andoutline on development of green banking.
BIBM is working to add bio-diversity issue in green banking.
ArunKarmakar, Special Correspondent of TheProthomAlo, said promotion of green banking is

vital in Bangladesh. Gas production has dropped leading to higher import of liquid fuel.
Bangladesh is also importing coal. Import dependency will rise by 90 percent by 2020-21.
According to his saying energy is imperative in habitual life, and if the reliance on import of fuel
reaches 90 percent then it is an alarming situation. Challenges in tapping domestic resources
but we must reduce our dependency on imported fuel sources and try to ensure our energy
security from domestic sources to the extent possible.
Prof. Dr. ZahurulHaqProfessor of the Bangladesh University of Engineering and Technology,

said promoting green banking is now our crucial point. There is a lack of adequate knowledge
on the issue. In Bangladesh, he said, people think that only solar energy and biogas are the
green energy; but these are not the only sources of green energy.
Lot of work is going on at policy level; but there is no clear idea about how to deliver incentives,
and there lies the problem, he said adding there is also no clear initiative on marketing. Finally
he added that “We should try our best to generate data of appliances and power generation
systems so that we can set some guidelines
12:00 AM, November 21, 2016 / LAST MODIFIED: 01:42 AM, November 21, 2016 daily star
33
8. Commendation
For performing Green Banking, the following preferential treatments will be included:
A. Bangladesh bank will reward banks on management module while computing CAMELS
rating. There will eventually be a progressive impression on overall rating of a bank.
B. Bangladesh Bank will announce the names of the Top Ten Banks for their overall
enactment in green banking activities in their websites.
C. Bangladesh Bank will cogitate green banking applies of a bank while taking permission
for opening new bank branch.
Specific Findings:
Agrani Bank is maintaining Bangladesh Bank’s regulations on Green Banking by forming a

“Green Banking Unit”. They disbursed total tk. 3132.84 lac for green financing. They are
maintaining in-house management, recycling products, green branching, roof top gardening,
online and mobile banking, green marketing. They are doing these all to ensure a green
business environment.
Beside these I have found some other factors. They are:
1. 45 banks already articulated green banking guidelines.

2. 46 banks have made a Green Banking unit for further green bankrolling.
3. 41 Banks have announced a Green Office Guide.
4. Environmental risk rating has been done for 13,779 projects.
5. 13,833 risk rated prefects have been financed.
6. 13, 07,479.64 million taka has been disbursed.
7. 212 Branches and 150 SME Units/ATM booths are powered by solar energy.
8. 37 banks are fully automated.
9. 3226 branches have been facilitated with online coverage.
34
a. Challenges for Green Banking

Foremost challenges ahead for green banking in Bangladesh:
 Coordination to go green among all the concerned authorities in this field is a great
concern for ensuring green bankrolling.
 Raising responsiveness and to build up operative capacity
 Concentration on sector wise lending procedures and guidelines.
 Quantitative methodology for a more justified rating.
7.3 Suggestions:
1. Speeding up awareness and effective capacity building.
2. Replicate global as well as local best practices.

3. Applying green banking and to use environmental risk management (ERM) guideline.
4. Focus on sector wise lending procedures.
5. Government should carefully monitor and supervise the green banking practices in
Bangladesh.
6. Government encourages the general people about green banking awareness through
the electronic and print media.
7. Further integration with credit risk management in the overall credit risk methodology.
8. Encouraging the borrowers to invest on green schemes to go green.
9. Develop a database for technical assistance/issues.
10. Cultural development within the organization grounding on environmental governance.
11. Concerned authorities need to coordinate among themselves regarding bankrolling.
12. Bangladesh bank must monitor the adherence of green banking guidelines by the
commercial and noncommercial banks.
13. Awareness of top management.
14. Apply quantitative approach for environmental risk rating.
35
9. Concluding Remarks
From the overall discussion, it can be alleged that green banking performs in Bangladesh are in
unsatisfactory level. The green accomplishments of Banks and Financial institutions in the
quarter ended December 31, 2016 signs dwindling picture in total green finance for both Banks
and FIs. Bangladesh bank will highlight with significance of green banking activities of a bank
while according permission for opening new bank branches and authorization for launching
new bank (Rahman, Ahsan, Hossain, & Hoq, 2015). Every bank should take ingenuities in
respect of green banking practices for protecting our environment Government should also
encourage the general people about the green banking practices. Bangladesh Bank forestalls an
important part to play that will lead the Banks and Financial institutions in mainstreaming green
banking activities. Direct financing is more preferable here. Thus Green Banking will have an
upbeat way to go forward.
36
10. References
Bangladesh Bank governor advocates green financing. (2017). bdnews24.com. Retrieved 27

March 2017, from http://bdnews24.com/economy/2015/02/14/bangladesh-bank-
governor-advocates-green-financing
Bangladesh Bank Home. (2017). Bb.org.bd. Retrieved 27 March 2017, from

https://www.bb.org.bd/
Green Banking and its present scenario in Bangladesh. (2017). Observerbd.com. Retrieved 27
March 2017, from http://www.observerbd.com/2015/05/26/90835.php
Islam, M., Hossain, K., Siddiqui, M., & Yousuf, S. (2014). Green-Banking Practices in Bangladesh-
A Scope to Make Banking Green. International Finance And Banking, 1(1), 1.
http://dx.doi.org/10.5296/ifb.v1i1.5161
Karim, R. (2017). Green Financing: Way to Sustainable Economic Growth. Green Financing: Way
to Sustainable Economic Growth | daily-sun.com. Retrieved 27 March 2017, from
http://www.daily-sun.com/arcprint/details/196654/Green-Financing:-Way-to-Sustainable-
Economic-Growth/2017-01-07
Masukujjaman, M., & Aktar, S. (2014). Green Banking in Bangladesh: A Commitment towards
the Global Initiatives. Journal Of Business And Technology (Dhaka), 8(1-2).
http://dx.doi.org/10.3329/jbt.v8i1-2.18284
Naim, M. (2015). Bangladesh Bank plays a leading role in green banking | VIEWS & REVIEWS |
The financial express. Print.thefinancialexpress-bd.com. Retrieved 27 March 2017, from
http://print.thefinancialexpress-bd.com/2015/08/27/105445
37
Omar Faruque, M. (2016). Green Banking and Its Potentiality & Practice in Bangladesh. Science
Journal Of Business And Management, 4(2), 28.
http://dx.doi.org/10.11648/j.sjbm.20160402.12
Rahman, M., Ahsan, M., Hossain, M., & Hoq, M. (2015). Green Banking Prospects in
Bangladesh. Asian Business Review, 2(2), 59. http://dx.doi.org/10.18034/abr.v2i2.305
Report, S. (2017). BB widens green finance scheme. The Daily Star. Retrieved 27 March 2017,
from http://www.thedailystar.net/bb-widens-green-finance-scheme-37874
Rifat, A., Nisha, N., Iqbal, M., & Suviitawat, A. (2016). The role of commercial banks in green
banking adoption: a Bangladesh perspective. International Journal Of Green
Economics, 10(3/4), 226. http://dx.doi.org/10.1504/ijge.2016.081906
38

Overview and Contribution of Agrani Bank Limited On Green Banking

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Internship Report

Submission: 30th march, 2017

Department of Banking and Insurance

Signature of the Supervisor

Signature of the Student

Thank you for all your guidelines and co-operations.

Banking and Insurance

1.2 Methodology of the report: ............................................................................................................... 2

1.3 Rationale of the Report ................................................................................................................ 2

1.4 Limitation of the Report............................................................................................................... 2

2. Overview of Agrani Bank ..................................................................................................................... 3

3.3 Implementing Green Banking Policy: .......................................................................................... 12

3.4 Branches and ATM/SME Units (Solar Powered) ............................................................................... 14

4. The global context .............................................................................................................................. 21

5.2 Action by developing countries: ....................................................................................................... 23

5.3 Specific needs of developing countries: ........................................................................................... 24

Table 1 Corporate Profile .............................................................................................................................. 3

Figure 1: BB Refinance Scheme................................................................................................................... 25

1.1 Objective of the Study:

 Aspects of green banking

 Judgments and Commendations

1.2 Methodology of the report:

 Direct interaction with Bank officials

 Bangladesh Bank periodic report

1.3 Rationale of the Report

1.4 Limitation of the Report

2. Overview of Agrani Bank

Legal status Public Limited Company

Registered office 9/D Dilkusha, Dhaka 1000

Products and Services:

B) Foreign Currency Account

2. Loans and Advances

 Cash Credit (Hypo)

c) Rural and Agro Credit

d) Small and Medium Enterprise Loan

 Service Sector Loan

 Loan Against Imported Merchandise

 Maintaining CRR and SLR

b) Foreign Exchange Market

 Selling Foreign Currency for Import Payment

 Letter of credit (Sight)

 Advance Payment Guarantee

6. Other Foreign Exchange Services

 Inter Branch Money Transfer

9. Value Added Service

10. Merchant Banking Service

11. Islamic Banking Service

 Bai Murabaha (Pledge)

Subsidiary Companies of ABL

1. Agrani Equity & Investment Limited

Particulars 2015 2014 Change

3. Industry Information and Analysis

3.1 Green Banking

Green Banking is defined as promoting environmental-friendly practices and reducing carbon

Fund allocation of Green Banking:

(a) Financial plan for green finance

(b) Financial plan for Climate Risk Fund and

Allocation of fund for Green Banking

Table 3 Allocation of fund for green financing

Area of allocation Amount (in million Tk.)

Green Finance 20,034.59

Climate Risk Fund 2,141.74

Marketing& capacity building 842.73