AN INTERNSHIP REPORT

ON
“Loan and Advance of Al Arafah Islami Bank Limited
(AIBL)”

Submitted To:
Amitava Bose Bapi
Assistant Professor
Department of Business Administration
Uttara University,
Dhaka.

Submitted By:
Mir Jahirul Islam
ID No: 2183061015
Batch: 47th
Program: MBA for BBA
Major: Accounting
Uttara University,
Dhaka

Date of Submission: 19th August 2019

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 Letter of Transmittal

Date: August 19. 2019

Amitava Bose Bapi
Assistant Professor
Department of Business Administration
Uttara University,
Dhaka.

Subject: Submission of Internship Report on “Loan and Advance of Al Arafah Islami

Bank Limited (AIBL)”.

Dear Sir,
I have the great pleasure to place before you my report “Loan and Advance of Al Arafah
Islami Bank Limited (AIBL)”as a partial fulfillment of the requirements for the degree of
Bachelor of Business Administration (MBA). To prepare this I have gathered information
from the institution mentioned and I believe those are most important and appropriate. A part
of the information has been collected by reading different books, journals, company annual
report and visiting company’s web sites related to the arena.

I have worked hard in preparing this report and hope that it will satisfy my course
requirement. I will be always available for answering any query about this report.
I would like to request you to accept my report and thereby oblige me.

Sincerely Yours,

Mir Jahirul Islam

ID No: 2183061015
Batch: 47th
Program: MBA for BBA
Major: Accounting
Uttara University,
Dhaka

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 Declaration of the Student

I do hereby solemnly declare that the work presented in this Internship Report titled “Loan
and Advance of Al Arafah Islami Bank Limited (AIBL)”is an original work done by me
under the supervision of Amitava Bose Bapi, Assistant Professor , Department of Business
Administration, Uttara University, Dhaka. No part of this report has been previously
submitted to any other University/ College/ Institution/ Organization for any academic
certificate/ degree/ diploma/ qualification.

Mir Jahirul Islam

ID No: 2183061015
Batch: 47th
Program: MBA for BBA
Major: Accounting
Uttara University,
Dhaka

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 Supervisor’s Certificate

This is to certify that Mir Jahirul Islam, ID No: 2183061015, Batch: 47th Program: MBA
for BBA, Major: Accounting, Uttara University has been completed in the practical
Internship Program at the Al Arafah Islami Bank Ltd. “Loan and Advance of Al Arafah
Islami Bank Limited (AIBL)”. Successfully with excellent performance under my
supervision.

I wish his every success in life.

Amitava Bose Bapi

Assistant Professor
Department of Business Administration
Uttara University,
Dhaka.

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 Acknowledgement

At first I am grateful to Almighty ALLAH to give me the opportunity to complete my

internship program and this internship report. As a student of Uttara University, Dhaka. I
would like to express a great pleasure to prepare an internship report on “Loan and Advance
of Al Arafah Islami Bank Limited (AIBL)”. It would be quite impossible to complete this
report without the co-operation and suggestion of Al-Arafah Islami Bank Ltd. It gives me
immense pleasure to acknowledge them with my gratitude.

I am extremely thankful to my honorable supervisor of my internship program Amitava Bose

Bapi, Assistant Professor, Department of Business Administration, Uttara University,
Dhaka. His tremendous support and direction, co-operation, valuable advice and endless
inspiration enable me to overcome all the difficulty that produce during my internship and
preparation of this report.

Lastly, I would like to thank and express my gratitude towards my friends who at various
stages had lent a helping hand.

Mir Jahirul Islam

ID No: 2183061015
Batch: 47th
Program: MBA for BBA
Major: Accounting
Uttara University,
Dhaka

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 Executive Summary
Islamic ideology encourages AIBL to succeed in life here & hereafter. To achieve this
success they try to follow the way dictated by the Holy Quran and the path shown by Rasul
(SM). For achieving this goal Al-Arafah Islami Bank Ltd was established (registered) as a
public limited company on 18 June, 1995. The inaugural ceremony took place on 27
September 1995.The authorized capital of the bank is Tk.2500.00 million and the paid up
capital Tk.9469.58 million. Some very renowned Islamic personalities and pious
businessmen of the country are the sponsors of the bank. 100% paid up capital is being
owned by indigenous shareholder.

AIBL’s loans and advances both in urban area and rural area increases over the year. That
means they are more concerned both in urban and rural area to provide loans and advances.
From the analysis we have seen that in 2016, AIBL’s recovery rate was 88.40% it was 18.4%
higher than the previous year. In 2016, AIBL’s non-performing loan was 1.87% on its total
loan which was higher than the previous year. Interest income on loans and advances is
increasing year by year. Al-Arafah Islami Bank Limited keeps lower provision for classified
loans and advance The level of credit risk of AIBL is in moderate level. The amount of total
loans, unclassified loans and classified loans is in increasing trend. Al-Arafah Islami Bank
Limited maintains good amount provision against the classified loans. Relationship between
Loans & Advances and Banks profitability is positive. Therefore, it can be said that effective
CRM can contributes on Bank’s financial performance.

AIBL should employee more good & talented professionals & train up employees properly
for better understanding of various loan offer to the customers. The SME sector loan is
increasing, They should try to continue this for inspiration of new entrepreneur. They should
give more concentration on agriculture sector as their participation of agriculture loan is
lower in compare to other sector. Deposit-Loan ratio of Al Arafah Islami Bank ltd. shows that
their ability to provide loan is strong. The average growth rate is 85.19%. It should be taken.
As from the graph we have seen that the bank is providing a large portion in unproductive
sector, which is not a good sign for our economy. So the bank should pay more concentration
on productive sectors like industrial loan instead of unproductive sector car loan. The bank
Should try to increase its loans quality by accelerating its a recovery policy.

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 Table of Contents
Title Page No.

Cover Page i
Letter of Transmittal ii
Student’s Declaration iii
Supervisor’s Declaration iv
Acknowledgement v
Executive summary vi
CHAPTER-01: INTRODUCTION 01-03
1.1 Background of the Study
1.2 Objectives of the Study
1.2.1 Broad objectives
1.2.2 The specific objectives
1.3 Major difficulties faced for accomplishing internship
CHAPTER-02: COMPANY PROFILE 04-08
2.1 Brief description of the company
2.2 Description of internship work related section
CHAPTER-03 : DATA COLLECTION AND PROCESSING 09-11
3.1 Data Description
3.2 Ways of Data Collection
3.3 Data Processing Methods
CHAPTER-04 : RESULTS AND DISCUSSIONS 12-23
4.1 1. To discuss the classification of Loan given by AIBL and analyze their performance.
4.2 2. To discuss the lending procedure of Al Arafah Islami Bank Limited.
4.3 3. To explain the loan disbursement procedure of Al Arafah Islami Bank Limited.
4.4 4. To analyze the trend of loan and advances over the year.
CHAPTER-05 : FINDINGS, RECOMMENDATIONS & CONCLUSION 24-27
5.1 Findings of the Study
5.2 Recommendations
5.3 Conclusion
CHAPTER-06 : INTERNSHIP EXPERIENCE 28-30
6.1 Work, workflow, People Met & my own Experience
6.2 My Job Responsibilities
6.3 Linkage between work-Internship topic
References
Appendices

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