-

“Analysis of Credit Management System of Jamuna Bank

Limited (JBL)”

Submitted to:
Sayed Farrukh Ahmed
Assistant Professor
Department of Business Administration,
Faculty of Business & Entrepreneurship

Daffodil International University

Submitted by:
S.M IqramulHaque

ID: 162-11-5227

Major in Accounting

BBA Program

Department of Business Administration,

Faculty of Business & Entrepreneurship

Daffodil International University

Date of Submission: 8th March, 2020

 Letter of Transmittal

Date: 08 March 2020

Sayed Farrukh Ahmed
Assistant Professor
Department of Business Administration
Faculty of Business & Entrepreneurship
Daffodil International University

Subject: Submission of Internship Report on “Analysis of Credit Management System of

Jamuna Bank Limited (JBL): a study on Shibu Market, Narayangonj Branch”.

Dear Sir,

I have been honored to present my internship report prepared by your permission and guidance. I am
granted to you for giving such an opportunity to make a report on “Analysis of Credit management
system of Jamuna Bank Limited (JBL): A study on Shibu Market, Narayangonj” as permitted by you. The
whole experience of this internship program has made me understand a sagacity about the tough situation
in life. I have tried my best with my consciousness to make a full fledge report by analyzing all the
requirements you have asked for. I think that will help me to develop my career.

I therefore, pray and hope that you would be kind enough to grant me to go through this report for
evaluating my performance. I am always available for my classification if any part of this paper.

Sincerely yours,

………………………………….

S. M. Iqramul Haque
ID: 162-11-5227
Program: BBA
Department of Business Administration
Daffodil International University
 Supervisor Certification

It’s my pleasure to certify that S.M Iqramul Haque, ID: 162-11-5227, student of Department of
Business Administration of Daffodil International University has successfully completed the
BBA internship program entitled “Analysis of Credit Management System of Jamuna Bank
Limited (JBL): A study on Shibu Market Branch, Narayangonj”. He has completed this work
under my supervision and prepared this report according to my direction and guidance.

I wish him every success in life.

Signature ………………………….
Sayed Farrukh Ahmed
Assistant Professor
Department of Business Administration
Faculty of Business & Entrepreneurship
Daffodil International University
 Acknowledgement

I am pleased to get this opportunity to express my special thanks to the person whose thoughts,
views and supports have provided fluency to prepare this report and also enriched this report. I
am grateful to all officials and staffs of Jamuna Bank Limited (JBL), as they for their huge
cooperation. And also grateful to the persons whose books, working papers, journals and related
materials give me continuous support to write this report.

I am greatly appreciated and inspired by Mr. Sayed Farrukh Ahmed, Assistant Professor,
Department of Business Administration, and Daffodil International University to write this
internship report on “Analysis of Credit Management System of Jamuna Bank Limited (JBL)”. I
would like to thanks “Md. Atikur Rahman, Vice President & Manager” JBL and also thanks “Mr.
Jalal Uddin, Assistant Vice President & Manager” JBL, at Shibu Market Branch, Narayangonj,
for giving me the opportunity to prepare this report with my full freedom and best co-operation. I
would also like to express my gratitude to all the employees of JBL, at Shibu Market
Narayangonj Branch for supervising me at the time of my internship attachment with their best
efforts.

I am very much grateful to all those individuals who have helped me so much. I would convey
my special thanks to my parents whose inspirations have enabled me to complete this report.
Finally, I would like to add a few more terms because this study is being prepared more cleanly
and of course there may be unwilling and omissions that very much my own.
 Executive Summary

The internship study has designed bridge the gulf between the theoretical and real life experience.
This study is on “Analysis of Credit Management System of Jamuna Bank Limited (JBL)”.
Jamuna Bank Limited is a third-generation bank. It is a private sector in banking system of
Bangladesh. Now JBL is offering about to all modern facilities of banking services with modern
technologies. This report focuses on “Credit Management System” of Jamuna Bank Limited. In
this report, Credit Management System is critical ingredient of an extensive approach to Credit
management system and essential to long term prosperity of any banking organization. Here they
used both primary and secondary. The interview was the basic strategies for collecting
organization’s primary data. Knowledge about the varieties of service was collected through
interview within the correspondent banking department. Among the secondary sources for
collecting data on banking performance over the past five years are the journal, JBL annual
report various JBL circulars and documents, terms report, training manual and banking lecture
sheets within the organization helped me collect original data. The whole system has been
described elaborately keeping in mind the most important segments. In addition, the diagrams
credit approval process & loan procedure, add a clear understanding of the system.

This report has organized in five chapters. The first chapter and second chapter show different
aspects of report including introductory words relating to bank objective of the study,
methodology, and company information which includes: background, vision, mission and
organizational structure. Third chapter contains the theoretical background of credit management
process, loan process and other process.

Fourth chapter is very significant part of the report, which includes performances analysis about
credit management. It includes the performance of unclassified loan, classified loan, bad & loss
loan, and doubtful loan and also Economic sector wise investments, Year wise Credit and growth.
From the analysis the result is quite satisfactory. Finally in chapter five some findings are made
based on the Study and proposed some suggestions for improving credit performance.
Serial No: Page No:
Table Of Content

Letter of Transmittal
Supervisor Certification
Acknowledgement
Executive Summary
1.0 Chapter One: Introduction 01
1.1 Introduction
1.2 Origin of the Study
1.3 Objective of the study
1.4 Methodology
1.5 Significance of the study
1.6 Limitations of the Study
2.0 Chapter 2
Organizational Overview
2.1 An overview of Jamuna Bank Limited (JBL)
2.2 Background & History
2.3 Vision
2.4 Mission
2.5 Governance
2.6 Objective of Jamuna Bank Limited (JBL)
2.7 Strategies of Jamuna Bank Limited (JBL)
2.8 Organizational Arrangement
3.0 Chapter 3
Credit Management of JBL
3.1 Principals of Credit Management Jamuna Bank Limited
3.2 Credit Risk Assessment
3.3 Problems in Management of credit in Jamuna Bank LTD
3.4 Loan Procedure of JBL

3.5 Funded Credits Related to International Trade Finance

3.6 SME Credit Scheme

3.7 Credit Products

3.8 Core Values

4. Chapter four
Analysis Part
4.1 Unclassified loan of JBL from the year 2014-2018
4.2 classified loan of JBL from the year 2014-2017
4.3 Doubtful loan of JBL From the year 2014-2018
4.4 Bad & loss loan of JBL from the year 2014-2018
4.5 Economic sector wise investments of jamuna Bank Limited
(JBL) for the year 2018
4.6 Recovery of Credit Management System
5.0 Chapter Five
Findings, Recommendation & Conclusion
5.1 Findings
5.2 Recommendations
5.3 Conclusion
5.4 Reference
Chapter One
Introduction
1.1 Introduction:
Jamuna Bank Limited is a third-generation bank in Bangladesh. It is a commercial bank in
Bangladesh registered under the Companies Act 1994. It plays an important part in the growth of
our country’s business sector. This bank’s growth is really strong. Its strategy is to offer
customers timely and prompt service. Jamuna Bank Ltd has implemented well-structured online
banking systems which make it easier for the customer to provide services quickly. The bank
primarily engages in corporate banking, trade finance, project finance, retail banking, small
enterprise finance, consumer finance and syndication. Its range of service offerings include cash
management services, payments and clearings, safe deposit locker services, employee benefits,
collection services, treasury services, asset management services and SWIFT for foreign trade.

1.2 Origin of the Study:

As a prerequisite of obtaining Bachelor of Business Administration (BBA) degree from Department of
Business Administration, Daffodil International University, every student has to go through an internship
program. The author of the study is worked as intern at “Jamuna Bank Limited (JBL)” a well reputed
private sector commercial bank, under the supervision of Sayed Farrukh Ahmed, Assistant Professor,
Department of Business Administration, Daffodil International University, the author has been assigned
to prepare an internship report on “Credit Management system of Jamuna Bank Limited”. This report is
written to comply with that instruction.

1.3 Objectives of the study:

The main objective of the Study is to analyze the credit management system of Jamuna Bank
Limited (JBL). The Specific objectives of the study are:

 To evaluate the lending procedure of Jamuna Bank Limited (JBL).

 To analyze the unclassified and classified loans and advances of (JBL).
 To analyze sector wise credit performance of JBL.
 To evaluate the loan recovery performance of JBL.
 To provide recommendations on the basis of findings.
1.4 Methodology of the study:

Sources of Data:

Both primary and secondary data have been used in preparing this report. The details of the
sources of data are as follows:

Primary Sources:

 Practical work experience with Jamuna Bank Limited.

 .Talking face to face with customers.
 Observations or monitoring.

Secondary Sources:

 Annual report of Jamuna Bank Limited.

 Credit Operational manual.
 Training materials of the bank.
 Periodicals published by Bangladesh Bank.
 Various books, journals, articles etc.
 Web sites.

1.5 Significance of the study:

In modern banking definition “Credit Management System” is one of a bank or financial

institution’s most important activities. Risk is inherent with all facets of commercial functions.
However, for Banks credit risk is a serious factor that needs to be managed. Immediate
development of the efficient and potential financial institutions is very significant for our
economy. Banking sector has to be improved a lot. One of the measures to improve this
condition is to spread and develop the “Credit Management System” efficient system which
requires ongoing study and research afterwards.
1.6 Limitations of the Study:
 The duration of our internship program is only just three month. The time allocated is not
enough for us to accumulate knowledge and make the analysis a complete and productive
one.it was one of the key constraints that influenced all aspects of is the analysis.
 The study also suffered from insufficiency of JBL data. Secondary information sources were
not sufficient to finalize the analysis.
 Most confidential information has not been revealed by the department’s respective
employees.
 The executives of JBL were too busy to spend time for the internee.
Chapter 2
Organizational
Overview
2.1 An overview of Jamuna Bank Limited (JBL)
Jamuna Bank Limited (JBL) is Bangladesh's leading private sector bank providing a complete
range of personal, corporate, international trade, lease, foreign exchange, and finance and capital
market services. JBL is the proposed choice in banking for friendly and customized services,
cutting edge technology, tailored business needs solutions, global trade and export scope and
high investment yields, ensuring excellence in banking services.

2.2 Background & History:

The banking system occupies a significant circumstance in the economy of a nation. A banking
institution is inescapable in a modern society. This plays a vital role in a country’s economic
growth. Against the backdrop of economic policy liberalization in Bangladesh, JBL developed
itself as a new commercial bank to provide proficient banking services with a view to improving
a country’s socio-economic development. Jamuna Bank Limited (JBL) is a Banking Company
registered under the Companies Act, 1994 with its Head Office at Chini Shilpa Bhaban, 3
Dilkusha C/A, Dhaka – 1000. The Bank started its activity from 3rd June 2001. All types of
banking transactions are undertaken by the bank to support the development of trade, commerce
and economy of the country. JBL’s facilities are also available for businessmen to set up new
manufacturing units and BMRE. Jamuna Bank Ltd. The only Bengali called private commercial
bank of the new generation was founded by a group of winning local entrepreneurs who
conceived the idea of setting up a model banking institution with different perspective to offer
valued customers a wide range of financial services and innovative products for sustainable
mutual prosperity and growth. The sponsors are renowned figures in the fields of trade,
commerce and industry. JBL is now looking to expand its spectrum by addressing all future
industries. With a comprehensive range of financial products and services, the bank is committed
to provide high quality financial services or products to its valued clients. A group of highly
educated and professional team with diversified experience in finance and banking is governing
and operating this bank. The Management of the bank constantly focuses on understanding and
deliberating customer’s needs. The bank’s obligation is to device strategy and new products to
cope with the changing situation as the scenario of banking business is changing day by day.
Within only 8 years Jamuna Bank Ltd. has already gained remarkable progress. The bank has,
and is known for its credibility, already rated as one of the top quality service provides. The bank
has currently centralized branches of online banking (Urban & Rural) across the country with
smart it backbone. In addition to this traditional delivery point, the bank has its own ATM,
sharing it across the country with other member banks & followership.

2.3Vision:
To be the country’s leading financial institution by offering high-quality products and services
backed by state-of the art technology and highly motivated team of banking experts.

2.4 Mission:
 To contribute to the socio-economic development of the country.
 To reach the highest level of satisfaction by supplying committed and motivated
professionals with comprehensive services.
 To hold market share increasing continuously by maintaining quality.
 To maintain respect for integrity and honesty at all levels.
 To ensure sustainable growth and to give honorable shareholders full value.
 Above all, to make effective contributions to the national economy.
2.5 Governance:
The organizational formation and corporate governance of JBL reflect the determination to
establish, sustain and increase its strength for a strong base as a customer-oriented bank with a
transparent management.

2.6 Objective of Jamuna Bank Limited (JBL)

The objective of the reports aim is to make us aware of the practical situation of Bangladesh’s
commercial banks in overall activity and prepare me to face the complex banking situation in
this country. The primary purpose of this report is to share the JBL requirement.

2.7 Strategies of Jamuna Bank Limited (JBL)

 To aim for the highest satisfaction of our customers & to gain their confidence.
 The most efficient way to manage and run the bank.
 Identifying the needs of consumers and tracking their understanding of these criteria.
 To review &updated policies, procedures & practices to enhance the ability to extend better
customer services.
 Training and growth of all workers and supplying them with sufficient resources to meet the
needs of customers.
 To maintain a warm work environment.
 Diversification of investments in both the retail and wholesale sectors.
2.8 Organizational Arrangement:
 Chapter 3
Credit Management of JBL
3.1 Principals of Credit Management of Jamuna Bank
Limited (JBL):
Bangladesh bank has directed all commercial banks to prepare a credit theory that will serve as a
credit management System guideline. Some noticeable features of credit principle of Jamuna
Bank Limited are described given below:
 Background
 Purpose of the facility
 Term of facility
 Safety and security
 Profitability
 Source of repayment
 Diversity of loan portfolio

3.2 Credit Risk Assessment:

Borrower Analysis:
 Reputation
 Shareholding
 Experience-Success History
 Net worth
 Education
 Age etc.

Industry Analysis:
 Industry position/Threat/prospect
 Risk factors pertaining to the industry
 Brower’s position/Share in the history
 Strength, weakness of the borrower compared to the competitors etc.
Supplier/Buyer Analysis:
 Concentration on single/Few buyer/Supplier is addressed

Projected Financials:
 Sufficiency of cash flows to service debt repayment
 Debt Service Coverage ratio
Analysis of Historical Financial:
 Cash flows
 Leverage
 Profitability
 Earning-its sustainability
Trade checking:
 Account Conduct: For existing customer the repayment history, credit turnover, study of
account statement
 Allied deposit with Jamuna Bank
 Other business with Jamuna Bank

3.3 Problems in Management of credit in Jamuna Bank LTD:

JBL faces many problem in Management of Credit:
Credit Sales: Now a day Businessman is bound for credit sales to growth their sales in the
competitive market. Business organizations Needless to work money banking companies lose
their investment potential in business organization.
Lack of Scope: since the bulk of the deposits, capital and investable funds have already been
employed in different loans and advances out of which a large portion have been stuck up as
classified and performing assets.
Comparative Banking Market: Different types of commercial Banks, both local and foreign
are serving in our commercial banking market Therefore, competing with other bank for weak
credit management it is hard to survive. Besides the whole banking sector in our country is
undergoing a critical stage due to political unrest and depressed economic condition.
Foreign Remittance: it means remittance of foreign currencies one place/person to another
place/person.in board sense, foreign remittance includes all sale and purchase of foreign
currencies on account of import and export, travel and other purpose. But especially foreign
remittance means foreign currency being sold and used for purposes other than export and import.
‘Jamuna Bank Limited’ carries out remittance work with various countries.it maintains the given
bellow:
 Foreign Demand Draft
 Inward remittance
 Outward Remittance

3.4 Loan Procedure of JBL:

 Term Loan
Term loan is a tracking loan that is repaid over a given period of time in regular payments.
This is usually repayable by monthly, quarterly or half yearly installments. Term loans
according to the duration of the repayment period are divided into three categories:
 Short Term
 Medium term
 Long term
Jamuna Bank Limited provides term loan in different forms based on the purpose of the
loan such as loan (General), House Building Loan (Commercial), House Building Loan
(General), House Building Loan (Stuff), etc.
 Fig: Different type of term loan provided by JBL

Term Loan

House
Building
Loan (Staff

House House
Loan Building Building
(General) Loan Loan
(commercial (General)
3.5 Funded Credits Related to International Trade Finance:

International Trade forms the major business activity undertaken by JBL. The bank provides a
comprehensive network of trading services with its corresponding worldwide network and close
relations with key financial instructions. Important branches of this bank are in Dhaka,
Chittagong, Sylhet, Naogaon which have well experienced employees in International Trade
Finance. These branches are the main point for corporate customers to process import and export
transactions. This bank provides full range of Trade Finance services. The professionals are
working hard so that the customers can meet up their requirements.
JBL has established correspondent banking relationships with 336 locations of 106 world reputed
banks in more than 100 countries. JBL offers all sorts of foreign/International Trade sponsored
Credits.
Foreign Trade related Funded Credits can be divided into two broad categories.
They are-
 Post–Import Funded Credits and
 Export & Post–Export Funded Credits.

i. Post–Import Funded Credits are Loan against Trust Receipt (LTR), Loan against Imported
Merchandise (LIM), etc.
ii. Export & Post–Export Funded Credits are Packing Credit (PC), Negotiation and Purchase
of Export Bills (FDBP), Discounting Bill of Exchange (LDBP) etc.
 Fig: Different types of Foreign Trade Related Funded Credits extended by JBL

Foreign Trade Related Funded

Credits

Export & Post-

Post Import
Export Funded
Funded Credits
Credits

LTR LIM PC FDBP LDBP

 Agricultural Credit:
JBL offers credit to the agro-industries at an interest rate.
 Industrial Credit:
JBL provides its corporate client groups a complete range of consulting, funding, and
operating services integrating finance, treasury, acquisition, and transactional banking
activities in on bundle.
 Lease Finance:
JBL the highly capitalized private commercial bank in Bangladesh, introduced lease
financing to promote valued customers’ financing requirements and the development of
their business houses. Lease means a contractual agreement between the owner of the
asset and its user against mutually agreed rent for a fixed time period. The owner i.e. the
Bank is called the Lessor and the user i.e. the customer is called the Lessee.
 Lease finance is one of the most convenient sources of financing of assets viz. machinery,
equipment vehicle, etc. For example- Luxury Bus, Mini bus, Taxi Cabs, Cars, Pick-up,
CNG three wheeler, Industrial Machinery & Equipment, Medical Equipment, Machinery
for Agro–based Industry are the lease items. And the maximum limit is up to 70% of
acquisition cost.

3.6 SME Credit Scheme:

At present Small & Medium Enterprise (SME) Credit is a very important product of banking.
The role of small and medium Enterprise is very important to the country’s economic growth.
SME play a vital role in generating jobs, especially self-employment, by making a substantial
contribution to GDP.
Being a socially committed bank JBL has introduced SME Credits with wide range of diversified
products under its SME Scheme with a view to emancipate the grass–roots level to their
economic height and to make profit by serving the interest of the missing small and middle
groups.

Fig: The Products of JBL under SME Credit Scheme

SME Credit Scheme

Double Loan
(Double amount Festival Loan for Flexible Loan for
of loan of FDR Credit purchasing Capital Working Women
value) Machinery Capital Entrepreneu
&Vehicle r

Loan for Purchase of Shop/ Business Working Capital/ Loan for Herbal
Possession Right for office Renovation Trade Finance Industry
Shop/ Business Loan
3.7 Credit Products:
JBL offers large range of diversified Retail Credit products that will help improve the country’s
living standers.

Fig: The Retail Credit Products of JBL:

Any Purpose
Lifestyle
Loan under Loan
customer credit Loan Against
scheme Salary
(CCS)

Household Durable
loan Study Loan

Retail Credit
Products
CNG
Marriage Loan Conversion
Loan

Travel Car Loan

Loan

Doctors Loan
 Fig: Credit Monitoring

1st Reminder by the Bank

2nd Reminder by the Bank

3rd or Reminder by the Bank

Providing Legal Notice

Excutive of legal rules by thje help of court

3.8 Core Values:

 Trust
 Customer focus
 Commitment
 Integrity
 Quality
 Business ethics
 Teamwork Respect
 Fairness
 Responsible Corporate Citizen
 Unique Culture
Chapter four
Analysis Part
4.1 Unclassified loan of (JBL)
Unclassified loan accounts are performing satisfactorily with regard to their payments, no
overdue occurs. All repayments of installments and interest are being received on time.

Table: Unclassified loan of JBL from the year 2014-2018

year Total loans and Amount of The ratio of the
Advances in BDT unclassified loan in unclassified Loan in
BDT total loans and
Advances
2014 88,243,477,425 78,377,846,376 88.82%
2015 102,432,507,238 97,248,207,654 94.93%
2016 117,099,608,428 112,356,108,428 95.95%
2017 142,252,938,595 136,527,839,595 95.98%
2018 165,402,850,110 159,171,726,110 96.23%

Series 2
Series 2

98.00%

96.00% 95.95% 95.98% 96.23%

94.93%
94.00%

92.00%

90.00%
88.82%
88.00%

86.00%

84.00%
2014 2015 2016 2017 2018

From the above figure, here is see that the unclassified loan ratio of Jamuna Bank Limited. From
2014 to 2018 the unclassified loan ratio was increase yearly.
4.2 classified loan of JBL from year 2014-2017
The overdue period of classified loan is 180-269 days. A classification for a loan that is expected
to result in a loss of interest for the lender, because for some reason, the creditor is unlikely to be
able to completely repay the loan. A lender will occasionally agree to a classified loan even
though it means some revenue will be lost, because typically no principal is lost on a classified
loan, only some interest.

Table: classified loan of JBL from the year 2013-2017

year Total loans and Amount of classified The ratio of the
Advances in BDT loan (BDT IN classified Loan in
CORE) total loans and
Advances
2014 88,243,477,425 9,865,631,049 11.18%
2015 102,432,507,238 5,184,299,584 5.06%
2016 117,099,608,428 4,743,500,000 4.05%
2017 142,252,938,595 5,725,099,000 4.02%
2018 165,402,850,110 6,231,124,000 3.77%

Series 1
Series 1

12.00%

10.00%

8.00%

6.00%

4.00%

2.00%

0.00%
2014 2015 2016 2017 2018

From the above figure, here is see that the classified loan ratio of Jamuna Bank Limited. From
2014 to 2018 the unclassified loan ratio was decrease yearly.
4.3 Doubtful loan of JBL From the year 2014-2018
The loan fully repayment is questionable and uncertain. Degree of repayment of the loans
concerned varies from full loss to uncertain loss if corrective steps are not taken. Doubtful loans
are usually non-performing loans on which interest is overdue and full collection of principal is
uncertain. This type of loan is an example of classified loan.

Table: Doubtful loan of JBL From the year 2014-2018

year Total loans and Amount of doubtful The ratio of doubtful
Advances in BDT loan in BDT Loan in total loans
and Advances
2014 88,243,477,425 95,400,000 0.11%
2015 102,432,507,238 114,200,000 0.11%
2016 117,099,608,428 185,600,000 0.16%
2017 142,252,938,595 294,990,000 0.21%
2018 165,402,850,110 498,639,000 0.30%

Series 1
0.35%

0.30%

0.25%

0.20%

0.15%

0.10%

0.05%

0.00%
2014 2015 2016 2017 2018

Series 1

From the above figure, here is see that the Doubtful loan ratio of Jamuna Bank Limited. Here
2014 and 2015 ratio was equal then the ratio was increase yearly.
4.4 Bad & loss loan of JBL from the year 2014-2018
Bad & loss loan is a specific loan and advance fall in this category when it seems that this loan
and advance is not collectable or worthless even after all the security has been exhausted. This
type of loan will not be repaid in more than 360 days. This type of loan is another example of
classified loan.

Table: Bad & loss loan of JBL from the year 2014-2018
year Total loans and Amount of bad & ratio of the bad &
Advances in BDT loss loan in BDT loss loan in total loan
and Advances
2014 88,243,477,425 3,167,400,000 3.59%
2015 102,432,507,238 3,785,200,000 3.70%
2016 117,099,608,428 4,422,800,000 3.78%
2017 142,252,938,595 5,109,406,000 3.59%
2018 165,402,850,110 5,564,706,000 3.36%

Series 1
3.90%

3.80%
3.78%
3.70% 3.70%

3.60% 3.59% 3.59%

3.50%

3.40%
3.36%
3.30%

3.20%

3.10%
2014 2015 2016 2017 2018

Series 1

From the above figure here we see that Bad & loss loan ratio of Jamuna Bank Limited. Here the
ratio 2014 to 2016 was increase yearly then 2016 to 2018 decreased yearly.
4.5 Economic sector wise investments of jamuna Bank Limited (JBL) for the
year 2018
The financial year 2018 JBL has invested five economic sectors. Sectors are Agriculture, Internal
Trade Finance, Textile and readymade garments, House Building, Special Program. The amount
of investment and the ratio are shown in the table.
Total investment Economic Sectors Economic sector Ratio of Economic
(CREDIT) figure in wise investment sector wise
crore (In BDT) (credit) figure in investments(credit)
crore (in BDT)
Agriculture 625.77 1.56%
Internal Trade Finance 4392.1 53.06%
Textile and readymade 14717.52 15.32%
28359.36
garments
House Building 2180.38 7.24%
Special Program 6443.59 22.82%

Figure: Economic sector wise investments in 2018

Economic sector wise investments 2018

1
2%
5
23%

4
2
7%
53%
3
15%

1 2 3 4 5

During the year 2018 2018 JBL invested in five sectors. We can see that Trade finance
investment 53% was the highest investment. Others sectors were Building 7%, Special Program
23%, Textile 16%, and Agriculture 2% which was the lowest investment.
4.6 Recovery of Credit Management System:

Year wise Credit and growth:

Loan & developments are approximately explained in the balance sheet. Loan and advances are
on the basis of their maturity/repayment term.

Year wise Credit and growth

Year 2014 2015 2016 2017 2018

Total Loans & advance
7790.98 8725.22 11179.96 14225.29 16525.29
Growth of Loans &
Advance 6.78% 11.99% 28.13% 27.24% 16.17%
Sources annual report of JBL 2014-2018

18000
16000
14000
坐标轴标题

12000
10000
8000
6000
4000
2000
0
2014 2015 2016 2017 2018
坐标轴标题

Series 1

Year wise Credit Disbursement

 Growth Rate
30.00%

25.00%

20.00%

15.00%

10.00%

5.00%

0.00%
2014 2015 2016 2017 2018

Growth Rate
 Chapter 5
Findings, Recommendations &
Conclusion
Findings:
 In 2018, the amount of unclassified loan of JBL was BDT 159,171,726,110 compared to
BDT 136,527,839,595 in 2017.

 In 2018, the amount of classified loan of JBL Was BDT 6,231,124,00 compared to BDT
5,725,099,000 in 2017.

 In 2018, the amount of doubtful loan was BDT 5,564,706,000 compared to BDT
5,109,406.000 in 2017.

 In 2018, JBL disbursed the maximum amount in internal commercial financing (53.06% of
the total amount of the loan disbursed.

 In 2017, loan disbursement in the agricultural. Sector was unsatisfactory 1.56% of the total
volume of loan disbursed.

 Recovery ratio of credit system of JBL 2018 was 16.17% which is decrease compared with
2017 was 27.24%.

 In some cases, JBL distributes loans without sufficient security which violates the
Bangladesh Bank order.

 The bank has no specific credit recovery unit to realize the credit from borrowers in time.
Recommendations:

The failure of commendable banks occurs mainly due to bad loans. Still from my learning and
observation, I am giving following recommendations to below:
 JBL Management will take some steps to boost the recovery efficiency. At first, Bank can
send a reminder to the customer three times. Make call to the customer or verbally say the
entire problem about loan adjustment and request to clean up all the deals. If the customer
fail to pay the money the guarantor’s responsibility to pay in terms of complain. The bank
must give to the client after the client refuses to change the loan amount. Finally, the bank
will sue the customer in court and the borrower must send the entire loan document.
 Central monitoring system should be more active in order to keep classified loans to a
minimum. If the central management team is more aware of how to minimize classified loans,
then the credit systems will have a positive effect.
 The introduction of credit recovery unit can be a unique opportunity for lenders to understand
credit.
 Strict monitoring is expected in the credit department to avoid defaulting on loans. Bank
official should do regular visit to the projects.
 Bank should lend diversified loans to various sectors for reducing risk. As like sectors
Transport, Residential, Agriculture etc.
 Banks can increase its retail credit loan by allowing credit to more customers. This can be
done by changing credit standards such as waiver of third-party guarantee.

Conclusion:
Jamuna Bank Limited (JBL) has been able to control its credit portfolio skillfully and kept the
classified loan at a very low rate thanks go to the standard and stringent credit evaluation policies
and practices of the bank. They will do better if they continue with their same strategy but they
also have to keep up the trend.
Reference:
1. Website of JBL, https://jamunabankbd.com/
2. Annual report of JBL from 2013-2014 https://jamunabankbd.com/front/information/13/46
3. Bangladesh Bank circular (www.bangladesh-bank.org)
4. Files, records, journals, manuals and publications obtained from library of the bank.