BB Viva Preparation: AD 2015 Circular (General Side)

Issue – 1

1. What is a bank?
A bank is a financial intermediary that lies between the savers and borrowers, conduct
payment functions and must be licensed as a banking corporation/company by the statute
of law.

2. What is a NBFI?
NBFI is a licensed financial intermediary whose liability is not money. They take term
deposit, mostly engaged in leasing and long term project financing. They provide wide
range of financial services like purchasing term deposit, leasing & hire purchase, factoring &
forfeiting etc. but cannot issue cheque. FIs can conduct their business operations with
diversified financing modes like syndicated financing, bridge financing, lease financing,
securitization instruments, private placement of equity etc.

3. The major difference between banks and FIs are as follows:

 FIs cannot issue cheques, pay-orders or demand drafts.
 FIs cannot receive demand deposits,
 FIs cannot be involved in foreign exchange financing,

4. What is central bank?

CB is the apex of monetary and financial system that is entrusted with formulation and
implementation of monetary policy, issue & management of currencies and supervision and
monitoring of banking system.

5. What is Bangladesh Bank?

Bangladesh Bank is the central bank and apex regulatory body for the country's monetary
and financial system which was established as a body corporate vide the Bangladesh Bank
Order, 1972. It was established as on 16 December 1971.
Supplementary QS: What is Ǯbody corporateǯ? Body corporate means Ǯa corporation
established under lawǯ

6. What do you know about Bangladesh Bank Order, 1972 ?

Itǯs a Presidential Order (P.O. No. 127 of 1972) effected from 16th December, 1971 under
which BB was established.

7. Why BB established under a PO? Why not under law?

Just after the liberation war and independence, some state organizations were most urgent
to be established like BB. At the same time Parliament was not effective and Presidential
orders proclaimed to establish some state organizations like Central Bank. Later on this PO
was validated by the Parliament.

8. How many Offices BB own?

10 branch offices: located at Motijheel, Sadarghat, Chittagong, Khulna, Bogra, Rajshahi,
Sylhet, Barisal, Rangpur and Mymensingh.
1 Head Office: located at Motijheel, Dhaka
1 Prepared by: 360 Degree Bank Job Preparation Cell: 01869-222-058
FB Group: 360 Degree Bank Job Preparation
9. What are the functions of BB?
Core functions are:
1) Formulation and implementation of monetary and credit policies
2) Regulation and supervision of banks and non-bank financial institutions
3) Forex reserve management
4) Issuance of currency notes and management of payment system
5) Acting as Governmentǯs Bank and lender of the last resort

10. What are the functions of Commercial banks?

1) Collecting deposits and lending money
2) Collecting money on behalf of customer
3) Making & taking payment on behalf of /for the customers
4) LC opening, payment, providing guarantee
5) Money transfer, card service, merchant banking services etc.

11. What are difference of a central bank and a commercial bank?

12. Know detail about 11 Governors and 3 Deputy Governors

13. Who belongs to BB Board of Directors?

14. Who is the Economic Advisor of BB? Dr. Md. Akhtaruzzaman

15. How many departments in BB? 53

16. The banking system at our independence consisted of two branch offices of the former
State Bank of Pakistan established in July 1948: one was in Bangladesh (former East
Pakistan) and the other was in West Pakistan (present Pakistan).

17. Complaint cell No. of BB: 16236

18. Financial system of Bangladesh is comprised of three broad fragmented sectors:

a) Formal Sector: includes all regulated institutions like Banks, Non-Bank Financial
Institutions (FIs), Insurance Companies, Capital Market Intermediaries like Brokerage
Houses, Merchant Banks etc.; Micro Finance Institutions (MFIs).
b) Semi-Formal Sector: includes those institutions which are regulated otherwise but
do not fall under the jurisdiction of Central Bank, Insurance Authority, Securities
and Exchange Commission or any other enacted financial regulator. This sector is
mainly represented by Specialized Financial Institutions like House Building Finance
Corporation (HBFC), Palli Karma Sahayak Foundation (PKSF), Samabay Bank,
Grameen Bank etc., Non Governmental Organizations (NGOs and discrete government
programs
c) Informal Sector: includes private intermediaries which are completely
unregulated.
2 Prepared by: 360 Degree Bank Job Preparation Cell: 01869-222-058
FB Group: 360 Degree Bank Job Preparation
19. Specialized Financial Institutions: They are called specialized FIs because they are
established under a particular/special law and to perform specialized goal. Four Specialized
FIs are:

a. House Building Financial Corporation(HBFC)

b. Palli Karma Sahayak Foundation(PKSF)
c. Samabay Bank
d. Grameen Bank

20. Banks: 57 scheduled & 6 non-scheduled banks

21. NBFIs: 33 NBFIs (maiden one was established in 1981) 2 is fully government owned, 1 is
the subsidiary of a SOCB, 15 were initiated by private domestic initiative and 15 were
initiated by joint venture initiative.
22. Insurance Companies: 18 Life and 44 Non-Life Insurance Companies regulated by IDRA.
23. Micro Finance Institutions: 599 MFIs
24. Primary dealers in treasury securities: 20 banks
25. Stock exchanges: Dhaka Stock Exchange and Chittagong Stock Exchange
26. State Owned Commercial Banks (SOCBs): There are 6 SOCBs which are fully or majorly
owned by the Government of Bangladesh.
27. Specialized Banks (SDBs): 2 specialized banks are now operating which were established
for specific objectives like agricultural or industrial development. These banks are also fully
or majorly owned by the Government of Bangladesh.
28. Private Commercial Banks (PCBs): There are 40 private commercial banks which are
majorly owned by the private entities. PCBs can be categorized into two groups:
conventional & Islamic.
29. Conventional PCBs: 32 conventional PCBs are now operating in the industry. They
perform the banking functions in conventional fashion i.e interest based operations.
30. Islami Shariah based PCBs: There are 8 Islami Shariah based PCBs in Bangladesh and they
execute banking activities according to Islami Shariah based principles i.e. Profit-Loss
Sharing (PLS) mode.
31. Foreign Commercial Banks (FCBs): 9 FCBs are operating in Bangladesh as the branches of
the banks which are incorporated in abroad.
32. 6 non-scheduled banks in Bangladesh which are:

 Ansar VDP Unnayan Bank,

 Karmashangosthan Bank,
 Grameen Bank,
 Jubilee Bank,
 Probashi Kollyan Bank,
 Palli Sanchay Bank

3 Prepared by: 360 Degree Bank Job Preparation Cell: 01869-222-058

FB Group: 360 Degree Bank Job Preparation