Internship Report On Credit Risk Management of NCC Bank Limited

Internship-Report-on-Credit-Risk-Management-of-NCC-Bank-
Limited
It is necessary for all BBA (Bachelors of Business Students) to prepare an internship report at the
end of this program. On the other hand internship is a course which is related to our course
curriculum. As a student of BBA in International Islamic University Chittagang (IIUC) my
intention is to capture some theoretical concept and to now how implement this theoretical
concept in our real life solution. Students are applying this concept in different organi!ations. So
I was assigned to perform my internship in "eneral Baning #epartment at $arayangon% Branch&
$CC Ban 'imited.
'ie clothes shops& candy shops& (aeshops& food shops& $CCB' is not a )de(t shop* the term
(eing used (y many to call the present say (ans. It is now (een called a modern (an that
undertaes all its operations at an international standard.
+aving started its operations as a commercial (an in ,--.& recovering from some primary
difficulties& $CCB Ban has now emerged as a ma%or player in the financial sector. /he (an has
(een a(le to attain a commenda(le CA01'S rating and its performance has (een outstanding in
terms of profita(ility for the year ended 23,3. 'isted in (oth the #haa and Chittagong Stoc
14change since late ,--- with an I5O that raised the paid6up capital of the (an to /.78 core&
the current price levels of its shares and turnover in trading is evidence of its high rating among
investors.
Over the years& $CCB' has (uilt itself as one of the pillars of Bangladesh9s financial sector and
is playing a pivotal role in e4tending the role of the private sector of the economy. Under the
dynamic guidance of its Board of #irectors headed (y the Chairman 0r. :au( Ali& the current
management has (een& arching ahead with new !eal to reach its goal in 23,,. /he (an is pledge
; (ound to perform even (etter in the coming years& opening new (ranches& adding new and
(etter products and services to its customers at their doorsteps.
/he (an has a strong (ranch networ nationwide with <, (ranches to effectively address the
needs of its cross6 segment customer (ase
/oday is the time of competition. As a (usiness student I am very interested to now the (usiness
world. On the other hand Baning practice and to now the overall Baning law is one of the
parts of (usiness.
1.2. Rationale of the Study:
=ell6educated& dedicated& silled and enterprising worforce is the sine6>ua6non for the progress
and development of a service oriented industry lie Ban. ?rom very first emergence and
inception of modern civili!ation& Ban plays a pivotal role in case of overall financial and
socioeconomic development of any modern country. /he economic development of our country
mainly depend upon the efficiency of the (aning results is so far as& whether the (aners have
1
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(een a(le to read the economic situation properly and are successful in selecting the promising
industrial sectors seeing import and e4port assistance to grow. =ith the rapid changes of time
mans are readily depend on (aning services in case of handling cash& transferring cash& and also
financing in various industrial and (usiness pro%ects. So it is very much needed to develop the
(aning practices and guiding law in order to provide (etter day to day (aning services to the
valued customers. Because as a service oriented industry a (an should (elieve that customers is
all and the ing. Customers favoring to a (an (y providing the opportunity to the (an to
serving him. /he government of our country and the central (an i.e.& the Bangladesh Ban has
decided to e4tend considera(le help in every respect of (aning and aware them a(out the law of
the (aning sector. 'ie other nationali!ed and non6nationali!ed commercial (ans lie NCC Bank
Limited serves the nation (y providing various modern (aning services and products. So as an Internee I
thought of having special nowledge on this field of increased importance.
1.3. SCOPE SCOPE OF OF TE TE REPORT REPORT:
$ational Credit and Commerce Ban 'td. ($CCB') is operating widely with <, (ranches all
over the Bangladesh. /his report is strictly confined $CCB' operation. /he report is (ased on
the o(servation and studies during my internship period in $arayangon% Branch& $arayangon%.
According to the study at first I will focus on the Company9s Bacground& 0anagement Style&
5resent status and specially the products of $CCB' etc. After that specific emphasis given on
the Ban9s functional areas such as Overall Baning practice& Accounts& 'oans @ Advance and
Ban regulation& Credit ris management and Compliance (y Bangladesh Ban.
1.!. O"#e$ti%e& of the &tudy:
/he Overall o(%ectives of the study is to present the Credit Ais management and practices at
$ational Credit and Commerce (an 'td.
/he main o(%ectives of this study are as followsB
/o now a(out the overall (aning practice of $CC Ban 'td ($arayangon% (ranch).
/o e4hi(it the Credit Ais management laws imposed (y Bangladesh Ban.
/o analy!e the e4tent of compliance with the Credit Ais management laws of
Bangladesh Ban (y $CC (an ltd.
/o highlight the impact of the credit performance of the (an and the pro(lems
associated with the compliance of Credit Ais management .
/o give suggestions for improving its credit performance.
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1.'. (ETO)OLO*+ OF TE REPORT:
/he information incorporated in this report has (een gathered from primary and secondary
sources. Apart from this& a review of related circular and office circular as well as face6to face
interview of the e4ecutives& officials and clients were carried out.
P,ima,y &ou,$e&-
?ace6to6face conversation with the respective officers and staff of the Branch.
Informal conversation with the clients.
5ractical wor e4posures from the different dess of the department of the (ranch.
Aelevant file and documents study as provided (y the concerned officers.
Se$onda,y &ou,$e&-
Unpu(lished data received from the (ranch.
Annual Aeport.
Bans record.
#ifferent paper of the (an.
Carious (oos& periodical seminar papers& training papers& manuals& =e( site& etc. related
to the topic.
1... Limitation& of the ,e/o,t:
/he first o(stacle was that they would not provide any remuneration even for doing
internship in $CCB'. It is not an easy tas to concentrate hard without any (enefit.
'imitation of time was one of the most important factors that shortened the present
study. #ue to time limitation many aspect could not (e discussed in the present study.
Aush hours and (usiness was another reason that acts as an o(stacle while gathering
data.
Confidentiality of data was another important (arrier that was faced during the conduct
of this study. 1very organi!ation has their own secrecy that is not revealed to others.
/hough I am one of their staff& while collecting data on $CCB'& personnel did not
disclose enough information for the sae of confidentiality of the organi!ation.
3
Sufficient (oos& pu(lications and figures were not availa(le. If these limitations were
not (een there& the report would have (een more useful.
It was very difficult to collect data from such a (ig organi!ation .0y internship was at
$arayangon% Branch which was esta(lished on 22
nd
Dune 23,3. So sufficient data was
not availa(le to collect all inds of information.
One of the ma%or sources of collecting information is the Organi!ation9s we( site. But
the we( site is not up6to6date comprising with other Bans.

C0PTER 2
OVERVIEW of NCC BANK Ltd
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1NTRO)2CT1ON:
$CC Ban 'imited is the leading private sector (an in Bangladesh offering full range
of 5ersonal& Corporate& International /rade& ?oreign 14change& 'ease ?inance and Capital
0aret Services. $CC Ban 'imited is the preferred choice in (aning for friendly
and personali!ed services& cutting edge technology& tailored solutions for (usiness needs& glo(al
reach in trade and highly yields on investment& assuring e4cellence in (aning services.
2.1. Ba$k 3,ound of NCC Bank Limited:
$ational Credit and Commerce Ban 'td. (ears a uni>ue history of its own. /he organi!ation
started its %ourney in the financial sector of the country as an investment company (ac in ,-<8.
/he aim of the company was to mo(ili!e resources from within and invest them in such way so
as to develop countryEs Industrial and /rade Sector and playing a catalyst role in the formation of
capital maret as well. Its mem(ership with the (rowse helped the company to a great e4tent in
this regard. /he company operated up to,--2 with ,F (ranches and thereafter with the
permission of the Central Ban converted in to a fully fledged private commercial Ban in ,--.
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with paid up capital of /. .-.33 corer to serve the nation from a (roader platform. Since its
inception $CC Ban 'td. has ac>uired commenda(le reputation (y providing sincere
personali!ed service to its customers in a technology (ased environment. /he Ban has set up a
new standard in financing in the Industrial& /rade and ?oreign e4change (usiness. Its various
deposit @ credit products have also attracted the clients6 (oth corporate and individuals who feel
comfort in doing (usiness with the Ban. =ithin this short time the (an has (een successful in
positioning itself as progressive and dynamic financial institution in the country. /his is now
widely acclaimed (y the (usiness community& from small entrepreneur to (ig merchant and
conglomerates& including top rated corporate and foreign investors& for modern and innovative
ideas and financial services.
2.2. 4i&ion
/he vision of the (an is to (ecome the (an of choice in the communities they serve the (an
accomplishes this (y offering to their customers the financial services which are e4pected (y
their customers while providing a return to their owners. In accomplishing this mission& the (an
has now (een free from all the natures of a pro(lem (an though full filling all the conditions set
(y the central (an. /hey proudly say9s $CCB' is profit maing and pro(lem freeG
2.3. (i&&on
$CC Ban shall (e at the forefront of national economic development (yB 6
i) Anticipating (usiness solution re>uired (y all $CC Ban9s customers everywhere and innovatively
supplying them (eyond the e4pectation.
ii) Setting industry (enchmar of world class standard in delivering customer value through the
comprehensive product range& customer service and all the activities.
iii) Building an e4citing team (ased woring environment that will attract& develop and retain
employees of e4ceptional a(ility who help cele(rate the success of (an9s (usiness& of (an9s
customers and of national development.
iv) 0aintaining the highest ethical standards and a community responsi(ility worthy of a leading
corporate citi!en
v) Continuously improving productivity and profita(ility and there(y enhancing share holder
value.
6
2.!. Slo3an
=here Credit @ Commerce Integrates
2.'. (otto
/he Ban will (e a confluence of the following three interestsB
Of the BanB 5rofit 0a4imi!ation and Sustained "rowth.
Of the CustomerB 0a4imum Benefit and Satisfaction.
Of the SocietyB 0a4imi!ation of =elfare.
2... 0$ti%itie& of NCCBL
/he world economy is going through various crises arising from insurgent activities at various
parts of the glo(e. /he tur(ulence also affected Bangladesh 1conomy adversely as well. /aa
has (een devalued. /he political unrest caused devastation to the industrial and service sectors.
/he (usiness communities as a whole apprehend ding imminent doom& tried to negotiate for a
compromise among the various concerned parties. /he (an earned a modestly satisfactory result
during the year 233<& which contri(uted in continuing its steady growth in respect of all ma%or
indicators& namely #eposit& Advance& 5rofit& etc. #uring the year $CCB' has concentrated its
focus to a num(er of income increasing sectors such as S01 ?inancing& Inward ?oreign
Aemittance& etc. Also it has put efforts to (ring discipline in administering Ban9s Asset through
various measures. As a whole& the outcome of these efforts was very positive and encouraging
indeed. 5rudent handling of Asset6'ia(ility is of utmost importance for eeping up profita(ility
at a satisfactory level of any financial institution. #uring last few years& with the timely measures
taen (y the 0anagement under guidance of the Board& it was possi(le to sustain steady growth
through maintaining asset >uality.
/he Ban has separate Credit Administration #epartment& Aecovery #epartment and also a tas
?orce for continuous monitoring of difficult loans and advances of the Ban and to propose ways
of recovery of Ban9s dues. /his process will continue in upcoming years also. ?urther& the Ban
will pay attention to manage lia(ility also so as to (uild up a strong deposit (ase to satisfy
investment need of the maret.
$CCB' plans to continue this pro%ect even after e4piry of the A5C?& if proved feasi(le. /he
Ban has put due emphasis on grooming up its worforce in a technology (ased woring
atmosphere for some time. Also to cater the needs of the customers& very recently $CCB'
started full6fledged real time On 'ine Baning System with implementation of ?lora Baning
UBS Software and introduced #e(it Card in the (rand name of )05ower Card* /he (an also
introduced a foreign remittance payment card in the (rand name of )0Bridge Card* Ban9s
Information /echnology #ivision is always engaged in designing need (ased software and other
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programmers to ease the situation for the employees so as to ena(le them to wor more
dedicatedly to satisfy the customers. Of late financing in S01s has (een proven to (e very
(eneficial for (aning sector. Bans have paid special focus to this sector to e4pand scopes of
e4tending credit facilities to enhance sustaina(le profit. S01 has (een found to (e a very
potential avenue of financing& since it is (elieved that small and medium entrepreneurs are very
hard woring and sincere in paying (ac Ban9s money. Bans are optimistic that investing in
this sector would not entail huge volume of default loan lie conventional or cooperate
financing.
2.5. Boa,d of di,e$to,
At present the Board of directors consists of 28 mem(ers including the Chairman and Cice
Chairman of the Ban. Out of 28 mem(ers 2, of them are the sponsors of the shareholders. 0ost
of the mem(ers are reputed industrialist and (usinesspersons of our country. /he Chairman
heads the Board. 1ach of the directors is the mem(er of the Board. /he mem(ers are o(liged to
maintain the annual general meeting and declare the dividend pay6out schedule on due time.
0oreover& the committee selected (y the shareholders represents individual (ody that then loos
after the periodic issue with the management and tries to solve the pro(lem.
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2.8. Organogram of Ncc bank ltd
9
2.6. O,3ani7ational St,u$tu,e of NCC Bank Limited at Na,ayan3on# B,an$h:
2.18. (ana3ement 1nfo,mation Sy&tem
Since its %ourney as commercial Ban in ,-<8 $CC Ban 'imited has (een laying great
emphasis on the use of improved technology. It has gone to online operation system since233..
And the new Baning Software ?le4i(le is under process of installation. As a result the (an will
a(le to give the services of international standards.
2.11.Co,,e&/ondent Relation&hi/
/he Ban esta(lished correspondent relationships with a num(er of foreign (ans& namely
American 14press Ban& Ban of /oyo& Standard Chartered (an& 0ashre> Ban& +ong Hong
Shanghai Baning Corporation& CI/I Ban $A6$ew :or and AB Ban 'td. /he Ban is
maintaining foreign e4change accounts in $ew :or& /oyo& Calcutta& and 'ondon. /he (an
has set up letter of credit on (ehalf of its valued customers using its correspondents as advising
and reim(ursing Bans. /he Ban maintains a need (ased correspondent relationship policy&
which is gradually e4panding.
2.12. T,ade Finan$e 0nd Co,,e&/ondent Bank
Successful Companied today are fully aware that they need to (e a(le to rely on the services of a
(an that can handle international trade with a good hand. 1ver since its conversion into a full
fledge (an in ,--.. $CC Ban has (een an accomplished )/rade ?inance* (an. =ith highly
professional team e4perienced and competent professionals we are a(le to provide a wide range
of services to companies engaged in international trade.
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$CCB' has also positions itself as an esta(lished correspondent (an. /hrough a worldwide
networ of 2F3 correspondent (ans. $CCB' is present in all ey areas of the glo(e. Our
am(ition of correspondents includes top raning international (ans with a glo(al reach.
2.13. 0utho,i7ed $a/ital:
/he Authori!ed Capital of the (an / ,3&333.33 million in the year 23,3. In 233- the
Authori!ed Capital was / 8&333 million. So the Authori!ed Capital (ecame dou(le from 233-
to 23,3.
2.1!. Paid-u/ $a/ital
/he (an raised its 5aid6up capital from /H. 2&2<7.-3 million to /H. 7&83,.28 million to from
233- to 23,3. =ith the increase of 5aid6up capital to more than dou(le& the capital (ased of the
(an has (ecome strong.
2.1'. Fun$tion& of the "ank
/he $CCB' performs all types of functions of a modern commercial (an& which generally
includesB
Accepting deposits
0aing advances and investments
#iscounting and purchasing (ills.
?inancing foreign trade ((oth import and e4port)
?acilitating remittance ((oth local and foreign)
5roviding various information& guidance and suggestions for promotion of trade and
industry eeping in view of the overall economic development of the country.
5roviding agency services.
2.1.. Ta,3et $u&tome,& :
#ue to the 5redecessor Company9s involvement investment6financing sector of the
country the (an inherited its top corporate customers. 0oreover the (an is involved in
import trade financing. Bul importers of consumer dura(le& food grains industrial raw
materials are its customers. /he (an has financed in te4tile and apparels sectors. /he
(an has a trend of choosing customers from diversified groups. /he (an has first class
customers in the construction sectors involved in high6rise (uilding& heavy construction
and roads and high way construction.
2.15. Re&e,%e fund 9 othe, ,e&e,%e
/he reserve fund of the Ban increased of /H. 8&II,.3- million in the year 23,3 as against /H.7&
.I,.F2million of previous year.
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C0PTER 3
GENERAL BANKING OF NCC BANK LIMITED
NARAYANGONJ BRANCH
12
3.1. )e/o&it
#eposit of the (an at the end of the year 23,3 was /H. FI&-F,.27 million& which was more than
deposit of 233-. ?rom 233F to 23,3 (an deposits has (een increased than that previous year.
/his is happen (ecause increasing confidence of customer to $CCB' inspires people to mae
more and more deposited to $CCB'.
3.2. P,odu$t& and &e,%i$e& of N$$ "ank ltd
5roductsB
#15OSI/ 5AO#UC/S 'OA$S @ A#CA$C1
Cu,,ent 0$$ount
Sa%in3& Bank )e/o&it 0$$ount
S/e$ial Noti$e )e/o&it :SN); 0$$ount
Te,m )e/o&it 0$$ount
P,emium Te,m )e/o&it 0$$ount
1n&tant Ea,nin3& Te,m )e/o&it
0$$ount
S/e$ial Sa%in3& S$heme
S/e$ial Fi<ed )e/o&it S$heme
(oney )ou"le P,o3,am
NFC)
RFC)
=oring Capital ?inancing
Commercial and /rade ?inancing
'ong /erm (Capital) ?inancing
+ouse Building ?inancing
Aetail and Consumer ?inancing
S01 ?inancing
Agricultural ?inancing
Import and 14port ?inancing
C0R)S A10I//A$C1
13
ServicesB
BRO=ER0*E O2SE TRES2R+ SER41CE RE(1TT0NCE SER41CE
0em(er& #haa Stoc
14change 'td.
?ull Service #epository
5articipant
5rimary #ealer of
"ovt. Approved Securities
0ore than ..3 ?inancial
Institutions all over the =orld.
,2 reputed 14change +ouses
covering ma%or 'ocations of
our e4patriate9s convenience.
)e/o&it &e$tion
In fact& a (an operates with the people9s money. /he (aning activity of a person starts with the
opening of an account. $CCB' generally gives facility to open the following accountsB
,. Current #eposit (C#)
2. Savings #eposit (SB)
.. ?i4ed #eposit (?#A)
7. Short /erm #eposit (S/#)
8. Special Savings Scheme (SSS)
F. Special ?i4ed #eposit Scheme(S?#S)
Cu,,ent )e/o&it 0$$ount
$CCB' opens current accounts for its clients to facilitate their day6to6day operations.
/he amount deposited in the current account can (e withdrawn at any time. $o interest is
given on the current account. In certain cases& however& interest is availa(le at an agreed
rate where withdrawals are su(%ect to a written notice for a specified period. /he
minimum (alance re>uirement for this account is /H.8333J6 and /H.283J6 is deducted
from the account in case of closing the current account.
14
Sa%in3& 0$$ount
/he (an provides savings account services for the ease of its clients. It offers (oth personal and
corporate Savings account to its clients in every (ranch. /he current rate on the deposit amount
is FK and the minimum (alance re>uirement is /H.,333J6. /he (an re>uires no other service
charge for this account.
Fi<ed )e/o&it
?i4ed #eposit is very much important for its contri(ution to the (an9s deposit creation process&
(ecause the highest amount of Ban fund from it9s direct customers comes in the form of ?i4ed
#eposit. ?or increasing the deposit (ase every commercial (an offers its customers various
rates according to the amount of deposit. In case of fi4ed deposit& clients consider two (2) things6
one is interest rate and another is certainty of their money. /hat means financial strength and
sta(ility of the concern (an. $CCB'9s interest rate is not e>ual or higher than their competitors&
(ut their fi4ed deposit curve is moving upwards. It is a great achievement for $CCB'.
$CCB' also offers its valua(le customers some significant rates for different amounts. /hose
areB
Pa,ti$ula,& Rate
Fi<ed )e/o&it fo, 3 (onth& ,2K
Fi<ed )e/o&it fo, . (onth& ,2K
Fi<ed )e/o&it fo, 1 +ea, ,2K
Fi<ed )e/o&it fo, 2 +ea, and a"o%e ,,K

. Sho,t Te,m )e/o&it :ST);
According to characteristics& short6term deposit is similar to current deposit e4cept interest.
/hough it is CJ# account (ut (earing some interest. Currently this interest rate is 7.33K.
S/e$ial Sa%in3& S$heme :SSS;
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/wo types of Account can (e opened under this scheme. One for a term of 8 years and another
for a term of ,3 years. Aules for (oth the accounts shall (e the same. 0inimum 0onthly
installments of deposit will (e /H.833J6 and its multiple up to /H.28333JL only as mentioned
(elow to (e deposited every month during the entire period of the scheme as fi4ed at the time of
opening of the account. Currently this interest rate is ,..33K. Account may (e opened for any
installment (ut later on the same is not changea(le. /he depositor(s) will (e paid a fi4ed amount
after e4piry of the term as followsB
16
(onthly
)e/o&it
:B)T;
0$tual Retu,n
afte, ' +ea,&
0$tual Retu,n
afte, 18 +ea,&
'88 7,&733 ,&,8&-33
1>888 <2&<33 2&.,&<33
2>888 ,&F8&F33 7&F.&F33
3>888 2&7<&733 F&-8&733
!>888 .&.,&233 -&2I&233
'>888 7&,7&333 ,,&8-&333
18>888 <&2<&333 2.&,<&333
1'>888 ,2&72&333 .7&II&333
28>888 ,F&8F&333 7F&.F&333
2'>888 23&I3&333 8I&-8&333
S/e$ial Fi<ed )e/o&it S$heme :SF)S;
0inimum /.83&333 or multiple amount is accepta(le under this scheme. /he duration of the
Scheme shall (e . years after which depositors can tae (ac the principal amountM if not
renewed. 0onthly interest will (e given to the depositors against the deposited amount according
to the following schedule. But after deducted ,3K income ta4 the amount will (e reduced.
Monthly Deposit
(BDT)
Monthly Profit
(BDT)
50,000 500
1,00,000 1,000
2,00,000 2,000
3,00,000 3,000
4,00,000 4,000
5,00,000 5,000
6,00,000 6,000
7,00,000 7,000
8,00,000 8,000
9,00,000 9,000
10,00,000 10,000
Rule& and Re3ulation& fo, O/enin3 an 0$$ount
,. Savings BanJ Current #epositJ ?i4ed #epositJ Special #epositJ 5remium /erm #epositJ
Instant 1arning /erm #epositJ Special Savings SchemeJ 0oney #ou(le #epositJ $?C#J
A?C#J ?C Account may (e opened in the name of adult individual or %ointly who isJare
mentally sound.
2. Savings Ban Account may (e opened in the name of Clu(& Association& Society and
similar institutions.
17
.. Savings Ban Account may (e opened in the name illiterate persons and minor person
after o(servingJcompletion of necessary formalities.
7. Current #epositJ ?i4ed #eposit Account may (e opened in the name of ?irm& Corporate
Bodies& Doint Stoc Companies.
8. Short /erm #eposit Account may (e opened in the name of Corporate Bodies& Doint
Stoc Companies.
F. A suita(le introduction accepta(le to the (an is re>uired for opening (an account
e4cept ?i4ed #eposit Account.
I. Initial #eposit for opening Savings Ban is /. ,&333.33& for Current #eposit AJC and
for Short /erm deposit AJC is /. 8333.33
<. Incidental charges to (e reali!ed twice in a year Dune @ #ecem(er N /. 233.33 from
Savings AJC and /. 833 from C#& S/#& @ all 'oans AJCs.
-. =ithdrawals from Savings& Current and S/# account can (e made only (y che>ues
supplied (u the (an duly signed with the specimine signature of the AJC holder(s)
recorded with the (an.
,3. Statement of accounts will (e supplied to the Account holder(s) every month free of cost.
Statement can (e supplied on re>uest against payment of /. 23.33 for each month9s
statement.
,,. If a depositor lies to close hisJherJtheir AJC& service charge for Savings AJC /. ,33.33
and for C# @ S/# AJC /. 833.33 will (e deducted from the AJC.
,2. /he Ban reserve the right to alter or add to or cancel any of the forgoing rules at any
time.
Ne$e&&a,y )o$ument& fo, O/enin3 an 0$$ount
1ndi%idual?@oint 0$$ount:
?or any individualJ%oint account the following papersJdocuments are re>uiredB
a) /wo copies of photograph of the account holder(s) who will operate AJC.
() One copy of photograph of the $ominee(s)
c) Introducer6attested (y currentJsavings account holder.
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d) 5hotocopy of $ational I# CardJ5assportJ#riving 'icenceJ/I$ CertificateJBirth
Certificate (oth AJC holder(s) and $ominee(s) duly attasted (y a authori!ed officer.
(ino,A& 0$$ount:
?ollowing documents have to (e o(tained in case of the account of minorB
e) 5utting the word )0I$OA* after the title of the account.
f) Aecording of the special instruction of operation of the account.
g) /he AO? (Account Opening ?orm) is to (e filled in and signed (y either the parents or
the legal guardian appointed (y the court of law and not (y the minor.
P,o/,ieto,&hi/ Fi,m:
/he following documents have to (e su(mitted for preparing an account of a 5roprietorship firmB
a) $ame of the firm.
() $ame of the 5roprietor.
c) Copy of /rade license.
d) Seal of 5roprietorship firm.
e) 5roprietor9s $ational Coter Identification Card9s 5hotocopy.
Pa,tne,&hi/ Fi,m:
/he following documents have to (e su(mitted for preparing an account of a partnership firmB
a) 5artnership deed.
(i) If the partnership firm is registered& one copy of registration forms.
(ii) If not& then a copy of certificate from the notary pu(lic.
() Certified copy of valid trade license.
c) /rade seal.
d) 5artnership account agreement (#raft enclosed)
Limited Com/any:
19
?or the opening of an account of a limited company& following documents have to (e su(mittedB
a) 14tract of Aesolution of the Board J "eneral 0eeting of the company for opening the
account and authori!ation for its operation duly certified (y the Chairman J 0anaging
director of the company.
() Certified true copy of the 0emorandum @ Articles of Association of the Company.
c) Certificate of Incorporation of the company for inspection and return along with a duly
certified 5hotocopy for Ban9s records.
d) Certificate from the Aegister of Doint Stoc Companies that the company is entitled to
commence (usiness (in case of 5u(lic 'td. Co. for inspection and return) along with a
duly certified 5hotocopy for Ban9s records.
e) 'atest copy of (alance sheet.
f) 'ist of #irectors with address (a latest certified copy of ?orm6Oll).
Clu" ? So$iety:
?ollowing documents have to (e o(tained in case of the account of the clu( or societyB
a) Up to date list of office (earers.
() Certified copy of Aesolution for opening and operation of account.
c) Certified copy of Byelaw and Aegulations J Constitution.
d) Copy of "overnment Approval (if registered).
Non-*o%t. Colle3e ? S$hool ? (ad,a&ha ? (ukta":
a) Up to date list of "overning Body J 0anaging Committee.
() Copy of Aesolution of the "overning BodyJ0anaging Committee authori!ing opening and
operation of the account duly certified (y "a!etted Officer.
T,u&tee Boa,d: ?ollowing documents have to (e o(tained in case of the account of trustee
(oardB
a) 5rior approval of the +ead Office of 5B'.
() Certified copy of #eed of /rust& up to date list of mem(ers of the /rustee.
c) Board and certified copy of the Resolution of rustee Board to open and operate the
account!
20
Ca,d &e$tion
/he (an (eing a service oriented organi!ation offers A/0 card and various types of credit card
mentioned as (elowB
0T( Ca,d?)e"it Ca,d
$CC Ban is e4tending A/0 facility through 16Cash shared A/0 $etwor. Use of additional
,72 A/09s Booth and F33 5OS of #utch6Bangla Ban. Cardholders can withdraw cash through
the A/0 Booth 27 hours a day .F8 days of the year. /here are two types of #e(it card provided
(y $CCB'
CISA (065ower) #e(it Card
5roprietary #e(it Card.
C,edit Ca,d
$CC Ban has launched its Cisa Credit Card Service on August 22& 2338 .Since then were a(le
to reach 8333 cards& (oth corporate and general. $CC Ban has offering three types of Credit
Card.
Ty/e of C,edit Ca,d
/here are three types of Cisa Credit Cards of $CCB'& these are 6
,. Cisa Classic&
2. Cisa "old ('ocal)
.. Cisa #ual Currency Card ("lo(ally and 'ocally).
Bide Ran3e of 0$$e/t
$CC (an Cisa Credit Card is accepted at over 8&333 merchant outlets around the country. Our
wide range of merchants include +otels& Aestaurants& Airline and /ravel Agents& Shopping
0alls& +ospitals& Dewelers Shops& 0o(ile 5hone and Internet Service 5roviders& 5etrol 5umps
and many moreP $ow $CC Ban Cisa Credit Cards can also (e used at all ,72 A/09s Booth
and F33 5OS (5oint of Sale) of #utch6Bangla Ban.
1n&tant Ca&h 0d%an$e
:ou do not need to carry cash any more if you have a $CC Ban Credit Card. :ou can withdraw
cash up to 83K of your credit limit from any A/0 across the country that shows Cisa logo.
21
C,edit Fa$ilitie&
$CC Ban Cisa Credit Card offers you free Credit facility up to 78 days and minimum of ,8
days without any interest (5urchase only).
Su//lementa,y Ca,d
$CC (an Cisa Credit Card holder can also en%oy spouse Credit Card free of cost for lifetime
and issue more Supplementary card.
ReCa,d P,o3,am&
As a $CC Ban Cisa Credit Card holder& you will accumulate /reasure points for every
purchase made (y using Cisa Credit Card. ?or every /. 83 and US# , spent on your Credit
Card& you will earn , and ,.8 /reasure 5oint accordingly and (e closer to redeeming the reward
of your choice.
Fle<i"le Payment O/tion
=ith the $CC Ban Cisa Credit Card& you have the convenience to pay as little as 8K of your
outstanding (or /. 833& whichever is higher) on the Card account every month& thus having the
power and fle4i(ility to plan your payments. Auto6#e(it 5ayment ?acility =ith the $CC (an
Credit Card& you no longer have to stand in long >ueues for paying your monthly (ill. :ou can
pay your monthly (ill through $CC Ban Account (y instruction Auto6#e(it.
Balan$e T,an&fe, Fa$ilitie&
If anyone holds other Ban Credit Card& then $CC Ban will issue a credit card with e>uivalent
limit and will issue a pay order (y de(iting card AJC from (alance transfer option for the
e>uivalent amount of total outstanding in order to full settlement and cancellation of other Ban
AJC.
Co,/o,ate 4i&a C,edit Ca,d
Corporate is characteristic of individuals acting togetherM )a %oint identity*M )the collective
mind*M )the corporate good*.
/he new dimension of $CC Ban Cisa Credit Card is Corporate Credit Card which has already
started to (enefit the Corporate +ouses.
$CC Ban promises the followings servicesB
?ast and Accurate Service
1ffective Communication
22
Attractive 5ricing (Annual fee 83K discount on card fee)
Strong Communication
Smiling faces of the Baners
"ood Am(ience in the Ban
3.3. The $a&h $ounte, &e$tion
=e now that a Ban is the #ealer of 0oneyM it receives money and pay money. =here cash
counter should (e the heart of any commercial (an9s (ranch office as it receives and pay cash
every moment at its woring time. Cash Counter also does a very important wor (y managing
the Ban9s flow of ?und. All the money of any Ban Business enters @ e4its through the cash
counter. /his section is the ma%or part of Ban that wors as the customer service oriented
section. /he efficiency of this section of a Ban crates the good image of that Ban to the all
type of customers. If the officials can serves at once the customer than it proves the strong
human resources of that Ban and increases customer satisfactions& which improve the overall
position of that Ban in the maret. It must (e mentioned that $CCB' has a very strong group of
employees& especially in the $arayangon% Branch& whom all the time serves the customers
satisfactorily. "enerally followings are some tass done (y the cash counter of $CCB' BanB
Cash Aeceive
Cash 5ayment
Aeceive of Credit Cards Bill.
5ayment of ?oreign Aemittance.
Aeceive Online /ransaction Charge.
5aymentJAeceive several #e(itJCredit Coucher.
3.!. The a$$ount& &e$tion
/his is the most confidential department of a (an. Aecording all inds of transactions of the
(ranch& confirming their accuracy and preparing statements are the main %o( of this department.
$ow6a6days under computeri!ed (aning system& the %o(s of accounts department (ecome very
23
easy. $ow the computer directly prepares the clean cash statement on party ledger vouchers. /he
function of the accounts department can (e divided into two partsB
a. #aily function
(. 5eriodical functions
a; )aily fun$tion&
/he routine daily tass of the accounts departments are as followsB
Aecord the daily transactions in the cash (oo.
Aecord the daily transactions in general and su(sidiary ledger.
5repare the daily position of the (ranch comprising of deposit and cash.
5repare the daily statement of affairs showing all the assets and lia(ility of the
(ranch as per ledger and su(sidiary ledger separately.
5ay all e4penditure on (ehalf of the (ranch.
0ae salary statement and pay salary.
Checing whether all the vouchers are correctly passed to ensure the conformity
with the QActivity Aeport9M if otherwise maing it correct (y calling the respective
official to rectify the voucher.
"; Pe,iodi$al Ta&k&
/he routine periodicals tased performed (y the department are as followsB
5repare the monthly salary statements for the employees.
5u(lish the (asic data of the (ranch.
5repare the weely position for the (ranch& which is sent to the +ead Office to
maintain Cash Aeserve Ae>uirement.
5repare the monthly position for the (ranch& which is sent to the +ead Office to
maintain li>uidity re>uirement.
5repare the weely position for the (ranch comprising of the (rea up of sector6
wise deposit& credit etc.
24
5repare the weely position for the (ranch comprising of the denomination wise
statement of cash in tills.
3.'. The $heDue $lea,in3 &e$tion
In Clearing Section che>ue& dividend warrants and other forms of financial instruments& which
are easy for encashment& are received. /he clearing department sends these instruments to the
Clearing +ouse of the Bangladesh Ban for collection. As soon as cash is received the amount is
deposited in the client9s account. Collection of che>ues& drafts etc. on (ehalf of its customers in
one (ehalf of its customers in one of (asic function of a commercial Ban. Clearing stands for
mutual settlement of claims made in (etween mem(er (ans at an agreed time and place in
respect of instruments drawn on each other.
$egotia(le instrument 'aw provides protection to a (aner who collects a che>ue or a draft if the
(aner fulfills the following conditionsB
+e collects the instrument for customer
/he instrument (e crossed
/he (aner acts in good faith and without negligence
/here are two types of clearing6
,. Outward Clearing
2. Inward Clearing
OutCa,d Clea,in3
Outward Clearing means when a particular (ranch receive instruments drawn on the other (an
within the clearing !one and those instruments for collection through the clearing arrangement is
considered as outward clearing for that particular (ranch.
CRE)1T
In line with the policy guideline issued (y the Central (an from time to time& the (an
formulates its own credit policy eeping it fle4i(le to accommodate changes that are taing
place. At present& several credit schemas are on the offer& which received >uit well response from
the customers and may help the (an to e4pand its customer (ase. /he (an also engaging in
25
syndication with other (ans for allowing large loans converging Bangladesh (anQs rules and
regulation.
3.. Loan and 0d%an$e &e$tion
0aing advances is the primary function of a (an. A ma%or portion of its funds is used for this
purpose and this is also the ma%or sources of (an9s income.
'oans are the right to receive payment or an o(ligation to mae payment on demand or at some
future time on account of the immediate transfer of goods (securities).
'oans are the largest asset item& which generally account for half to almost three6>uarters of the
total value of all (ans assets. A (an9s loan account typically is (roen down into several
groups of similar type loans. /he 'oan and Advances made (y the $CCB' can (roadly (e
classified (y following categories6
,. Continuous 'oan
2. #emand 'oan
.. /erm 'oan
7. Other Special Scheme
Continuou& Loan
/hese are those advances which do not have any set schedule for drawing or dis(ursement (ut
usually have a terminal date of full ad%ustment or repayment.
a) Cash Credit (CC)
() Over #raft (O#)
0; Ca&h C,edit :CC;:
A Cash Credit (CC) is an arrangement (y which the customer is allowed to (orrow money up to
a limit. /his is a permanent arrangement and the customer need not draw the sanctioned amount
at once& (ut draw the amount as and when re>uired. /hey can put (ac any surplus amount&
which they may find with them. /hus Cash Credit (CC) is an active and running account& which
deposits and with drawls may (e affected fre>uently. Interest is charged only for the amount
withdrawn and not for the whole amount charged.
If the customer does not use the cash credit (CC) limit to the full e4tent& a commitment charge is
made (y the (an. /his charge is imposed on the unutili!ed portion of Cash Credit (CC) only.
26
Cash Credit (CC) provides an elastic form of (orrowing since the limit fluctuates according to
the needs of the (usiness. Cash Credits (CC) are the most favorite mode of (orrowing (y large
commercial and industrial concerns in our country.
Cash Credit (CC) arrangements are usually made against the security of commodities
hypothecated or pledged with the (an.
/here are two types of CC accountB
i). Cash Credit (+ypothecation)
ii). Cash Credit (5ledge)
"; O%e, ),aft :O);:
Overdraft (O#) is an arrangement (etween a (aner and its customer (y which the latter is
allowed to withdraw over his credit (alance in the current account up to an agreed limit. /his is
only a temporary accommodation usually granted against securities. /he (orrower is permitted to
draw and repay any num(er of times& provided the total amount overdrawn does not e4ceed the
agreed limit. /he interest is charged only for the amount drawn and not for the whole amount
sanctioned.
A cash credit is differs from an overdraft in one respect. A cash credit is used for long term (y
(usinessmen in doing regular (usiness whereas overdraft is made occasionally and for short
duration.
/here are two inds of overdraft.
a) Secured Over #raft
() Unsecured Over #raft
)emand Loan
/he loan which (ecome paya(le after serving demand notice (y the (an concerned are termed
as #emand 'oan.
/here are five inds of demand loan. /hese are given (ellowB
a) 'oan against Imported 0erchandise ('I0)
() 'oan against /rust Aeceipt ('/A)
27
c) 5ayment against #ocuments (5A#)
d) 'oan against 5acing Credit
a; Loan a3ain&t 1m/o,ted (e,$handi&e :L1(;
Usually& importer fails to retire the documents in spite of repeated reminders of the (aner or the
(an has to clear the goods imported under the 'etter of Credit at the re>uest of the importer
((orrower). In (oth the cases& whether the importer fails to retire the documents or re>uest for
clearance of goods& the outstanding under 5A# or BJ1 is transferred to ELoan a3ain&t 1m/o,ted
(e,$handi&e :L1(;F account and the overdue interest from the date of accompanying Bills of
14change or negotiating date to the date of transfer to 'I0 account is charged. At the time of
opening of letter of credit the (ans o(tain from the importer an arrangement on stamped paper
which provides for financing and& if necessary& clearance and storage of goods (y de(iting
importer9s account at their ris and responsi(ilities. After clearance& consignments are taen
delivery (y the importer on full payment of (an9s lia(ility. $ormally part delivery is not
allowed while on 'I0 account. =hen the delivery in part is desired (y the importer& the 'I0 is
converted into cash credit account retaining proper margin and e4ecuting charge documents& the
delivery is affected thereafter on o(taining pro rata payment.
"; Loan a3ain&t T,u&t Re$ei/t :LTR;
Under this arrangement& credit is allowed to the importer to retire documents and release the
consignment from the customs authority against trust& receipt eeping the goods under importer9s
control. /he rate of interest of $CCB' on '/A N ,7.83K.
$; Payment a3ain&t )o$ument& :P0);
/he (an that opens the letter of credit is (ound to honor its commitment to pay for import (ills
when these are presented for payment& if drawn strictly in terms letter of credit. /he foreign
correspondent (an& who negotiates the documents& de(its the account of the opening (an and&
in fact& the amount thus stands advanced on (ehalf of the importer. /he opening (an will lodge
the shipping documents to their (oo and will respond to the de(it advice originated (y the
foreign correspondent to the de(it of )5ayment against #ocuments (5A#)* account or )Bills of
14change (BJ1)* accounts and present the (ill to the importer for payment. /he rate of interest of
$CCB' on 5A# N ,7.83K
d; Loan a3ain&t Pa$kin3 C,edit
5acing credit is a short term advance granted (y (an to an e4porter for assisting him to (uy&
process& pacs and ships the goods. /he credit is gradually e4tended for payment of freight&
handling charges& insurance and e4port duties. A pacing credit advance does not normally
e4tend (eyond ,<3 days and has to (e li>uidated (y negotiationJ purchase of the (ills of
e4change. /he rate of interest of $CCB' on this pacing credit N I.33K.
28
e; Loan a3ain&t 1n%e&tment
In order to contri(ute to the development of the Capital 0aret of the country $CC Ban
'imited e4tends credit facilities against pledge of Shares& #e(entures& 5ri!e Bonds& Bangladesh
Ban /reasury Bills etc. to the individuals as well as to the 0em(er of #S1 @ CS1.
Te,m Loan
/hese are loans which have a specific term for repayment as specified in the loan agreement.
a) 'oan ("eneral)
() +ousing 'oan
c) 5ro%ect 'oan
d) /ransport 'oan
e) Small Business 'oan Scheme
f) 5ersonal 'oan Scheme
a; Loan :*ene,al;
In case of loan general& the (aer advances a lump sum for a certain period at an agreed rate of
interest. /he entire amount is paid on an occasion either in cash or (y credit in hisJher current
account which heJshe can draw at any time. /he interest is charged for the full amount
sanctioned whether heJshe withdraws the money from hisJher account or not. /he loan may (e
repaid in monthly installments or at the e4piry of a certain period.
"; ou&in3 Loan
A large amount of money needed to construct a house or purchase a apartment .It is not possi(le
to of all people to construct a house (y only own income sources. 1specially this pro(lem largely
faces (y middle level and fi4ed income people. /o solve this pro(lem& $CCB'9s offer +ousing
loan with easy repayment condition and less interest rate.
$; P,o#e$t Loan
29
$CC (an 'td has their pro%ect loan scheme. /hough they do not invest in pro%ect loan
e4tensively (ut now they are planning on pro%ect loan. Because pro%ect loan is huge investment
and it completely depends on success of the pro%ect for that reason (an always eeps eye some
ma%or factor (efore invest on pro%ect loan. Before invest on pro%ect loan Ban always who is the
people involves in the pro%ect Security standard of the (orrower. /hen (an loos for the
feasi(ility report of the pro%ect. Borrower has to completely show the feasi(ility report to the
head office. In the feasi(ility report (orrower has to show the what the mission of the pro%ect&
who are the target customer& comparative analysis of the pro%ect with other same pro%ect& how the
pro%ect meets the demand of the target customer& for which purpose the loan is asing for& detail
information of the pro%ect operation& detail price list of the e>uipment& appro4imate repayment
planning (y the (orrower. Branches do not have any authority to sanction any amount of loan for
pro%ect loan. Branch can only asses the pro%ect feasi(ility& evaluate the client chec the necessary
papers and collect it from the client. After getting the entire necessary papers (ranch maes a
proposal for the loan and send it to the head office. +ead office then re6evaluate the proposal
with necessary papers. /hen head office again inspects the pro%ect. After getting all the
evaluation head office then send the sanction letter to the (ranch. 'oan amount then dis(urse
from the (ranch. Branch has to do the regular monitoring until the whole loan amount is repaid.
d; T,an&/o,t Loan
$CC Ban 'td was an investment company (efore the conversion in a (an. So they have good
idea a(out lease financing. /ransport loan is fallen under the lease financing& though it is called
transport loan (ut it is actually fallen under leasing term and condition. $CC Ban 'td does not
have any car loan scheme for individual clients& they had this scheme (ut the scheme is
completely stopped for the time (eing.
5rocess of transport loan is more or less similar to pro%ect loan. Borrower has to apply for the
loan in prescri(ed (an application form. In the application form (orrower must mention which
vehicle he wants to (uy and what9s the >uantity. Borrower also has to provide detail price list of
the vehicle& insurance paper for each vehicle& possi(le repayment planning of the loanM list of
collateral& list of hypothecation of securities and other necessary papers depends on clients and
num(er of vehicles. After getting all necessary papers and field inspection (ranch maes a
proposal for the loan and sends it to the head office. +ead offices then again checs the
necessary papers and do the field inspection. After inspection if +ead Office thins that for
sanction of the loan they need more papers and securities& (orrower has to provide those papers.
Branches usually do not have any authority to sanction any amount of loan amount (ranch only
dis(urse the amount and do the regular monitoring whether the vehicle is purchased& is they
>uotation match with the real one& vehicle is in the route and more importantly (orrower is
repaying the installment regularly.
e; Small Bu&ine&& Loan S$heme
30
Small (usinessman tae place a large portion in our country. 0ore of them are honest& energetic
and hardy. In the a(sence of sufficient capital more of them cannot manage their (usiness properly.
/hey have not sufficient asset to mae a security against loan& as a result they are failure to tae a
loan from (an or other financial assistance institution. If a loan give to them with easy terms and
condition then this energetic small (usinessman not only manage and increase their (usiness
properly (ut also they tae important role in development of our country. /o meet up this purpose&
$CCB' start Small Business 'oan Scheme.
f; Pe,&onal Loan S$heme
?i4ed income employee9s of various firm or company need urgently financial assistance for the
following purpose6
0arriage purpose
1ducation purpose
Advance against Salary
1ducation 'oan
/ravel 'oan
1specially meet up this financing (y own income source is very difficult for middle class people.
/o solving these pro(lems $CCB' introduce 5ersonal 'oan Scheme for Salaried 5erson.
Othe, S/e$ial S$heme
$CCB' Operate some ind of loan scheme as well to contri(ute the overall economy& poverty
alleviation and fulfill some (asic needs of the people. /he special loan schemes areB
a) Consumer Scheme
() 'ease ?inance
c) 0icro credit financing
a; Con&ume, S$heme
/he Scheme aims at improving the standard of living of the fi4ed income group. Under the
scheme the clients may secure loan facilities at easy installments to procure household amenities.
";Lea&e Finan$in3
31
An entrepreneur& under this scheme& may avail of the lease facilities to procure industrial
machinery (without having to purchase it (y down payment) with easy repayment schedule. /he
clients also get special re(ate in their income6ta4 payment under the scheme.
'ease financing is one of the most convenient long term sources of ac>uiring capital machinery
and e>uipment. It is a very popular scheme where(y a client is given the opportunity to have an
e4clusive right to use an asset& usually for an agreed period of time& against payment of rent. Of
late& the lease finance has (ecome very popular in almost all the countries of the world. An
o(vious advantage of the lease is to use an asset without having to (uy it. /he lessee is o(ligated
to mae lease payments until the e4piration of the lease agreement& which corresponds to the
useful life of the assets. In a capital scarce economy lie ours& 'ease ?inancing is suita(le for
firms to ac>uire Capital 0achinery& 1>uipments& 0edical Instruments& and Automo(iles etc.
And there(y employ their own resources more advantageously in some other investments. 'ease
financing also helps a firm to reap significant economic (enefit through ta4 saving and (y
reducing the ris of the e>uipments (ecoming o(solete due to the technological advancement.
$; (i$,o $,edit finan$in3
/o fulfill its commitment to play a vital role in socio economic development of the country $CC
Ban 'td has introduce a small and medium credit scheme for its customers.
/he o(%ective of the scheme isB
/o encourage and develop medium and small entrepreneurs
/o provide credit with minimum comple4ity
/o generate employment.
Under the scheme& $CC Ban 'td. is providing loanB
/o meet woring capital
/o purchase capital machinery and for e4pansion of (usiness and for purchasing
household dura(ly.
/he Scheme covers the following areas of optionsB
03,i$ultu,e &e$to,B Seed or crop loan& 5oultry and ?isheries& ?ish processing&
5lot& ?ish storage and 0areting 5ro%ect& with processing pro%ect etc.
32
Small and Cotta3e 1ndu&t,yB +andicraft maer& Blacsmith& ?ishing net weaver&
handloom industry& "oldsmith& watch assem(ling pro%ect& mineral water plant etc.
Se,%i$e 1ndu&t,y: /ransportation& medical service provider& different type of shop
owners& hotel and restaurant owners& vocational training center etc.
ou&ehold du,a"le and Con&ume, $,editB 1lectric e>uipment& 1lectronics&
Cehicles& ?urniture& medication and +ospitali!ation& cooeries etc.
1nfo,mation Te$hnolo3y Se$to,B Computer and Computer accessories purchase
for household use& selling up of Computer training institute& Software development
for e4porting purpose& Software development for local (usiness and household
users.
Ene,3y Se$to,B +ousehold purchase of su(stitute energy lie U5S& I5S&
Sta(ili!er& Battery etc. Biogas technology& solar electricity producing plant& small
electricity production etc.
3.5. Rate& of )iffe,ent Loan and 0d%an$e:
Prti!"lrs #nterest
$te
Cash Credit (CC) 13"
Overdraft (OD) 14"
Small Loan 14"
Exports [Packing Credit & ECC 7"
Cons!mer "inance Scheme 16"
Commercial and #rade "inancing 14!50"
$orking Capital "inancing 14!00"
Loan(%) against (P&") 16!00"
'etail and Cons!mer "inancing 16!00"
S(E "inancing 16!00"
#ransport Loan 16!00"
33
)mport and Export "inancing 07!00"
Long #erm (Capital) "inancing 14!00"
*o!se Loan+'esidential (*,LS) 13!00"
*o!sing Loan (Commercial) 14!00"
-gric!lt!ral "inancing 11!50"
Loan+%.#erm Loan [Small Cottage )nd!str/ 13!25"
Loan+%.#erm Loan [Large & (edi!m Scale )nd!str/ 13!25"
Commercial Loan (P-D0 L#' & L)() 14!50"
Commercial Loan [Pledge & */pothecation 13!00"
Small Scale )nd!str/ [Loan+%.#erm Loan & $orking
Capital
16!00"
C0PTER !
B0N=1N* OPER0T1ONS
CONTROLL1N* BO)+ 1N NCC B0N=
LT).
.
34
/he +ead Office is located at I6< 0oti%heel CJA& #haa. It monitors and controls the (aning
operations of the (ranches scattered in different strategic (usiness locations in Bangladesh. At
present& there are ,. divisions in the +ead Office. /he classifications of the different divisions
are mentioned as followsB
35
$ow descri(e it (elow
C,edit di%i&ion
/he Credit #ivision is one of the most essential and valua(le divisions of every commercial
(ans. /he Credit #ivision of the Ban deals with issues regarding Corporate ?inance& "eneral
Credit& Special Schemes such as +ouse Building 'oan (+B') and Consumer Credit Scheme
(CCS)& Small @ 0edium 1nterprise (S01) 'oan etc.
02)1T 1NSPECT1ON RECO4ER+ )1STR1B2T1ON
36
Although the loan Administration #ivision is not at par with the Credit #ivision of the (an in
terms of +uman Aesource& the performance of the Ban relies heavily on this division. It is
responsi(le for credit monitoring& documentation& distri(ution '.#.O.s (loans& discounts and
overdrafts)& preparing 0SOC? (0onthly Statement Of Outstanding Credit ?acilities) and dealing
with /A (/rust Aeceipt) etc.
. BO0R) )141S1ON
/his division deals with (oard of directors of the organi!ation. Usually when the (oard meeting
held where it will held and other activities are done (y this department.
2(0N RESO2RCE )141S1ON
/he necessary of having an efficient +uman Aesource #ivision is one of the uni>ue re>uirements
for the success of any (usiness organi!ation. $ational Credit and Commerce (an 'imited unlie
other commercial (ans has a proficient +uman Aesource #ivision that deals with recruitment
and manpower planning& performance evaluation& disciplinary actions& promotion& cadre charge&
employee service rules and (enefits& training and development. An 14ecutive Cice 5resident
leads this division with the assistance of a Cice 5resident.
EST0BL1S(ENT )141S1ON
'ogistic and "eneral Services #ivision is considered as the center for providing necessary
supporting services to other department as well as the employee. /he function of this division
includes providing utility services& maintenance of premises& and purchase of printing and
general stationery& dispatch and transport pool. A Cice 5resident monitors this division.
1NTERN0T1ON0L )141S1ON
/he role of the International #ivision is very vital to providing various (aning service to the
clients. /his division also maintains the mutual relationship with many corresponding (ans on
several issues such as agency and credit line arrangement& reconciliation& authori!ed signature
control& /HC (test ey control)& issuance of power of attorney& fund management and treasury
operations (foreign) etc.
1nfo,mation te$hnolo3y di%i&ion
It is very significant to adapt with the ongoing information technology revolution to provide
faster services to the clients. /he Information /echnology #ivision supervises the overall
computeri!ation of the (aning operations and networing& provides system support& deals with
data processing and data entry& procures and maintain hardware& maintain and develop software
re>uired (y the (an to facilitate and support the day to day operations.
Ca,d di%i&ion
37
/he core functions of the Card #ivision include dealing with issues regarding de(it card& A/0
card& and credit card& customer and vendors management. An Assistant. Cice 5resident heads
this division.
. (a,ketin3 and ",an$h di%i&ion
/his division is e4pected to deal with issues regarding mareting of asset and lia(ility products&
(ranch e4pansion etc. this division involves introducing new financial products. It also deals
with renovation of new (ranches and location of new (ranches.
T,ainin3 di%i&ion
/he main o(%ective of this division is to mae the employees efficient. Usually this division
offers training to their employee time to time. /his is helpful to the employee to do their %o(
efficiently and effectively.
T,ea&u,y di%i&ion
/he ey responsi(ility of this division is to utili!e its fund to various profita(le (usinesses.
Usually financial organi!ation has huge capital and they invest this capital in various (usiness.
. Pu"li$ ,elation di%i&ion
/he main o(%ective of the pu(lic relation department is to mae a (ridge within the organi!ation
and outsiders. /his division directly deals with general pu(lic.
Cent,al a$$ount di%i&ion
/his division monitors several important functions of (aning operations performed in different
(ranches across the country. It deals with accounts& financial planning& (udget and monitoring&
preparation of returns and statement& reconciliation& maintenance of 5? (5rovident ?und)&
gratuity and superannuation fund& local treasury etc.
38
CHAPTER 5
CREDIT RISK MANAGEMENT GUIDELINES BY
BANGLADESH BANK
0mendment of &e$tion 13 of 0$t N.1! of 1661: In section ,. of the said Act6 the words
Rprevious financial yearR& wherever they are mentioned& the words Raccounting yearR the
following e4planation shall (e added& namelyB 6 R?or the purpose of this section& demand
lia(ilities and temporary lia(ilities shall not include the paid6up capital& the consolidated fund&
the lia(ilities shown in the profit and loss account and loans received from the Bangladesh Ban
and inter(an lia(ilities.R
39
1N)2STR+ BEST PR0CT1CES 0S S2**EST) B+ B0N*L0)ES B0N=
'.1 Poli$y *uideline&
/his section details fundamental credit ris management policies that are recommended for
adoption (y all (ans in Bangladesh. /he guidelines contained herein outline general principles
that are designed to govern the implementation of more detailed lending procedures and ris
grading systems within individual (ans.
Lendin3 *uideline&:
All (ans should have esta(lished Credit 5olicies ()'ending "uidelines*) that clearly outline the
senior management9s view of (usiness development priorities and the terms and conditions that
should (e adhered to in order for loans to (e approved. /he 'ending "uidelines should (e
updated at least annually to reflect changes in the economic outloo and the evolution of the
(an9s loan portfolio& and (e distri(uted to all lendingJmareting officers. /he 'ending
"uidelines should (e approved (y the 0anaging #irectorJC1O @ Board of #irectors of the (an
(ased on the endorsement of the (an9s +ead of Credit Ais 0anagement and the +ead of
CorporateJCommercial Baning. (Section 2., of these guidelines refers) Any departure or
deviation from the 'ending "uidelines should (e e4plicitly identified in credit applications and a
%ustification for approval provided. Approval of loans that do not comply with 'ending
"uidelines should (e restricted to the (an9s +ead of Credit or 0anaging #irectorJC1O @ Board
of #irectors. /he 'ending "uidelines should provide the ey foundations for account
officersJrelationship managers (A0) to formulate their recommendations for approval& and
should include the followingB
1ndu&t,y and Bu&ine&& Se3ment Fo$u&:
/he 'ending "uidelines should clearly identify the (usinessJindustry sectors that should
constitute the ma%ority of the (an9s loan portfolio. ?or each sector& a clear indication of the
(an9s appetite for growth should (e indicated (as an e4ample& /e4tilesB "row& CementB
0aintain& ConstructionB Shrin). /his will provide necessary direction to the (an9s mareting
staff.
Ty/e& of Loan Fa$ilitie&:
/he type of loans that are permitted should (e clearly indicated& such as =oring Capital& /rade
?inance& /erm 'oan& etc.
C,o&& Bo,de, Ri&k:
Ais associated with cross (order lending. Borrowers of a particular country may (e una(le or
unwilling to fulfill principle andJor interest o(ligations. #istinguished from ordinary credit ris
(ecause the difficulty arises from a political event& such as suspension of e4ternal payments
40
o Synonymous with political @ sovereign ris
o /hird world de(t crisis. ?or e4ample& e4port documents
negotiated for countries lie $igeria.
'.2 C,edit 0&&e&&ment 9 Ri&k *,adin3
C,edit 0&&e&&ment
A thorough credit and ris assessment should (e conducted prior to the granting of loans& and at
least annually thereafter for all facilities. /he results of this assessment should (e presented in a
Credit Application that originates from the relationship managerJaccount officer ()A0*)& and is
approved (y Credit Ais 0anagement (CA0). /he A0 should (e the owner of the customer
relationship& and must (e held responsi(le to ensure the accuracy of the entire credit application
su(mitted for approval. A0s must (e familiar with the (an9s 'ending "uidelines and should
conduct due diligence on new (orrowers& principals& and guarantors. It is essential that A0s
now their customers and conduct due diligence on new (orrowers& principals& and guarantors to
ensure such parties are in fact who they represent themselves to (e. All (ans should have
esta(lished Hnow :our Customer (H:C) and 0oney 'aundering guidelines which should (e
adhered to at all times. Credit Applications should summaries the results of the A0s ris
assessment and include& as a minimum& the following detailsB
o Amount and type of loan(s) proposed.
o 5urpose of loans.
o 'oan Structure (/enor& Covenants& Aepayment Schedule&
Interest)
o Security Arrangements.
In addition& the following ris areas should (e addressedB
Bo,,oCe, 0naly&i&:/he ma%ority shareholders& management team and group or affiliate
companies should (e assessed. Any issues regarding lac of management depth&
complicated ownership structures or intergroup transactions should (e addressed& and
riss mitigated Industry analysis.
Su//lie,?Buye, 0naly&i&. Any customer or supplier concentration should (e addressed&
as these could have a significant impact on the future via(ility of the (orrower.
i&to,i$al Finan$ial 0naly&i&. An analysis of a minimum of . years historical financial
statements of the (orrower should (e presented. =here reliance is placed on a corporate
guarantor& guarantor financial statements should also (e analyses. /he analysis should
address the >uality and sustaina(ility of earnings& cash flow and the strength of the
41
(orrower9s (alance sheet. Specifically& cash flow& leverage and profita(ility must (e
analy!ed.
P,o#e$ted Finan$ial Pe,fo,man$e: =here term facilities are (eing proposed& pro%ection
of the (orrower9s future financial performance should (e provided& indicating an analysis
of the sufficiency of cash flow to service de(t repayments. 'oans should not (e granted
if pro%ected cash flow is insufficient to repay de(ts.
0$$ount Condu$t: ?or e4isting (orrowers& the historic performance in meeting
repayment o(ligations (trade payments& che>ues& interest and principal payments& etc)
should (e assessed.
0dhe,en$e to Lendin3 *uideline&: Credit Applications should clearly state whether or
not the proposed application is in compliance with the (an9s 'ending "uidelines. /he
Ban9s +ead of Credit or 0anaging #irectorJC1O should approve Credit Applications
that do not adhere to the (an9s 'ending "uidelines.
.
Loan St,u$tu,e: /he amounts and tenors of financing proposed should (e %ustified (ased
on the pro%ected repayment a(ility and loan purpose. 14cessive tenor or amount relative
to (usiness needs increases the ris of fund diversion and may adversely impact the
(orrower9s repayment a(ility.
Se$u,ity: A current valuation of collateral should (e o(tained and the >uality and priority
of security (eing proposed should (e assessed. 'oans should not (e granted (ased solely
on security. Ade>uacy and the e4tent of the insurance coverage should (e assessed.
Name Lendin3: Credit proposals should not (e unduly influenced (y an over reliance on
the sponsoring principal9s reputation& reported independent means& or their perceived
willingness to in%ect funds into various (usiness enterprises in case of need. /hese
situations should (e discouraged and treated with great caution. Aather& credit proposals
and the granting of loans should (e (ased on sound fundamentals& supported (y a
thorough financial and ris analysis. Appendi4 iv contains a template for credit
application.
Ri&k 3,adin3
All Bans should adopt a credit ris grading system. /he system should define the ris profile of
(orrower9s to ensure that account management& structure and pricing are commensurate with the
ris involved. Ais grading is a ey measurement of a (an9s asset >uality& and as such& it is
42
essential that grading is a ro(ust process. All facilities should (e assigned a ris grade. =here
deterioration in ris is noted& the Ais "rade assigned to a (orrower and its facilities should (e
immediately changed. Borrower Ais "rades should (e clearly stated on Credit Applications.
/he following Ais "rade 0atri4 is provided as an e4ample. /he more conservative ris grade
(higher) should (e applied if there is a difference (etween the personal %udgment and the Ais
"rade Scorecard results. It is recogni!ed that the (ans may have more or less Ais "radesM
however& monitoring standards and account management must (e appropriate given the assigned
Ais "radeB
'.3 0//,o%al 0utho,ity> Se3,e3ation of )utie& 9 1nte,nal 0udit
0//,o%al 0utho,ity
/he authority to sanctionJapprove loans must (e clearly delegated to senior credit e4ecutives (y
the 0anaging #irectorJC1O @ Board (ased on the e4ecutive9s nowledge and e4perience.
Approval authority should (e delegated to individual e4ecutives and not to committees to ensure
accounta(ility in the approval process. /he following guidelines should apply in the
approvalJsanctioning of loansB
Credit approval authority must (e delegated in writing from the 0#JC1O @ Board (as
appropriate)& acnowledged (y recipients& and records of all delegation retained in CA0.
#elegated approval authorities must (e reviewed annually (y 0#JC1OJBoard.
/he credit approval function should (e separate from the maretingJrelationship
management (A0) function.
/he role of Credit Committee may (e restricted to only review of proposals i.e.
Aecommendations or review of S(an9s loan portfolios.
Approvals must (e evidenced in writing& or (y electronic signature. Approval records
must (e ept on file with the Credit Applications.
All credit riss must (e authori!ed (y e4ecutives within the authority limit delegated to
them (y the 0#JC1O. /he )pooling* or com(ining of authority limits should not (e
permitted.
Credit approval Sshould (e centrali!ed within the CA0 function. Aegional credit centers
may (e esta(lished& however& all large loans must (e approved (y the +ead .
Credit and Ais 0anagement or 0anaging #irectorJC1OJBoard or delegated +ead
Office credit e4ecutive.
/he aggregate e4posure to any (orrower or (orrowing group must (e used to determine
the approval authority re>uired.
43
Any credit proposal that does not comply with 'ending "uidelines& regardless of amount&
should (e referred to +ead Office for Approval.
0#J+ead of Credit Ais 0anagement must approve and monitor any cross (order
e4posure ris.
Any (reaches of lending authority should (e reported to 0#JC1O& +ead of Internal
Control& and +ead of CA0.
Se3,e3ation of )utie&
Bans should aim to segregate the following lending functionsB
o Credit ApprovalJAis 0anagement
o Aelationship 0anagementJ0areting
o Credit Administration
/he purpose of the segregation is to improve the nowledge levels and e4pertise in each
department& to impose controls over the dis(ursement of authori!ed loan facilities and o(tain an
o(%ective and independent %udgment of credit proposals.
1nte,nal 0udit
Bans should have a segregated internal auditJcontrol department charged with conducting audits
of all departments. Audits should (e carried out annually& and should ensure compliance with
regulatory guidelines& internal procedures& and 'ending "uidelines and Bangladesh Ban
re>uirements.
'.!. P,efe,,ed o,3ani7ational &t,u$tu,e 9 ,e&/on&i"ilitie&
/he appropriate organi!ational structure must (e in place to support the adoption of the policies
detailed in Section , of these guidelines. /he ey feature is the segregation of the
0aretingJAelationship 0anagement function from Approval J Ais 0anagement
JAdministration functions. Credit approval should (e centrali!ed within the CA0 function.
Aegional credit centers may (e esta(lished& however& all applications must (e approved (y the
+ead of Credit and Ais 0anagement or 0anaging #irector JC1O Board or delegated +ead
Office credit e4ecutive.

=ey Re&/on&i"ilitie&
/he ey responsi(ilities of the a(ove functions are as followsB
C,edit Ri&k (ana3ement :CR(;
44
o Oversight of the (an9s credit policies& procedures and controls relating to all credit riss
arising from corporateJcommercial institutional (aning& personal (aning& @ treasury
operations.
o Oversight of the (an9s asset >uality.
o #irectly manage all Su(standard& #ou(tful @ Bad and 'oss accounts to ma4imi!e
recovery and ensure that appropriate and timely loan loss provisions have (een made.
o /o approve (or decline)& within delegated authority& Credit Applications recommended (y
A0. =here aggregate (orrower e4posure is in e4cess of approval limits& to provide
recommendation to 0#JC1O for approval.
o /o provide adviceJassistance regarding all credit matters to line managementJ A0s.
o /o ensure that lending e4ecutives have ade>uate e4perience andJor training in order to
carry out %o( duties effectively.
o Credit AdministrationB
o /o ensure that all security documentation complies with the terms of approval and is
enforcea(le.
o /o monitor insurance coverage to ensure appropriate coverage is in place over assets
pledged as collateral& and is properly assigned to the (an.
o /oS control loan dis(ursements only after all terms and conditions of approval have (een
met& and all security documentation is in place.
o /o maintain control over all security documentation.
o /o monitor (orrower9s compliance with covenants and agreed terms and conditions& and
general monitoring of account conductJperformance.
Relation&hi/ (ana3ement?(a,ketin3 :R(;
o /o act as the primary (an contact with (orrowers.
o /o Smaintain thorough nowledge of (orrower9s (usiness and industry through regular
contact& factoryJwarehouse inspections& etc. A0s should proactively monitor the financial
performance and account conduct of (orrowers.
o /o (e responsi(le for the timely and accurate Ssu(mission of Credit Applications for new
proposals and annual reviews& taing into account the credit assessment
o /o highlight any deterioration in (orrower9s financial standing and amend the (orrower9s
Ais "rade in a timely manner. Changes in Ais "rades should (e advised to and
approved (y CA0.
o /o see assistanceJadvice at the earliest from CA0 regarding the structuring of facilities&
potential deterioration in accounts or for any credit related issues. Internal AuditJControl
o Conducts independent inspections annually to ensure compliance with 'ending
"uidelines& operating procedures& (an policies and Bangladesh Ban directives. Aeports
directly to 0#JC1O or Audit committee of the Board.
45
'.'. P,o$edu,al 3uideline&
/his section outlines of the main procedures that are needed to ensure compliance with the
policies contained in Section ,.3 of these guidelines.
'..0//,o%al P,o$e&&
/he approval process must reinforce the segregation of Aelationship 0anagementJ 0areting
from the approving authority. /he responsi(ility for preparing the Credit Application should rest
with the A0 within the corporateJcommercial (aning department. Credit Applications should
(e recommended for approval (y the A0 team and forwarded to the approval team within CA0
and approved (y individual e4ecutives. Bans may wish to esta(lish various thresholds& a(ove
which& the recommendation of the
+ead of CorporateJCommercial Baning is re>uired prior to onward recommendation to CA0
for approval. In addition& (ans may wish to esta(lish regional credit centres within the approval
team to handle routine approvals. 14ecutives in head office CA0 should approve all large loans.
/he recommending or approving e4ecutives should tae responsi(ility for and (e held
accounta(le for their recommendations or approval. #elegation of approval limits should (e such
that all proposals where the facilities are up to ,8K of the (an9s capital should (e approved at
the CA0 level& facilities up to 28K of capital should (e approved (y C1OJ0#& with proposals
in e4cess of 28K of capital to (e approved (y the 1CJBoard only after recommendation of CA0&
Corporate Baning and 0#JC1O.
C,edit 0dmini&t,ation
/he Credit Administration function is critical in ensuring that proper documentation and
approvals are in place prior to the dis(ursement of loan facilities. ?or this reason& it is essential
that the functions of Credit Administration (e strictly segregated from Aelationship
0anagementJ0areting in order to avoid the possi(ility of controls (eing compromised or issues
not (eing highlighted at the appropriate level. Credit Administration procedures should (e in
place to ensure the followingB
)i&"u,&ement:
Security documents are prepared in accordance with Sapproval terms and are legally enforcea(le.
Standard loan facility documentation that has (een reviewed (y legal counsel should (e used in
all cases. 14ceptions should (e referred to legal counsel for advice (ased on authori!ation from
an appropriate e4ecutive in CA0. #is(ursements under loan facilities are only (e made when all
security documentation is in place. CIB report should reflectJinclude the name of all the lenders
with facility& limit @ outstanding. All formalities regarding large loans @ loans to #irectors
should (e guided (y Bangladesh Ban circulars @ related section of Baning Companies Act.
All Credit Approval terms have (een met.
46
Cu&todial )utie&:
'oan dis(ursements and the preparation and storage of security documents should (e centrali!ed
in the regional credit centers. Appropriate insurance coverage is maintained (and renewed on a
timely (asis) on assets pledged as collateral. Security documentation is held under strict control&
prefera(ly in loced fireproof storage.
Com/lian$e ReDui,ement&:
All re>uired Bangladesh Ban returns are su(mitted in the correct format in a timely manner.
Bangladesh Ban circularsJregulations are maintained centrally& and advised to all relevant
departments to ensure compliance. All TSthird party service providers (value9s& lawyers& insurers&
C5As etc.) are approved and performance reviewed on an annual (asis. Bans are referred to
Bangladesh Ban circular outlining approved e4ternal audit firms that are accepta(le.
'.5 1n$enti%e P,o3,am:
Bans may wish to introduce incentive programs to encourage Aecovery Unit (AU) Account
0anagers to (ring down the $on 5erforming 'oans ($5's).
/he ta(le (elow shows an indicative incentive plan for AU account managersB
47
Aecovery as a K of
5rincipal plus interest
Aecommended Incentive as K of net recovery
amount
If CG 7- if C,itten off
5.G to 188G ,.33K 2.33K
'1G t8 5'G 3.83K ,.33K
28G to '8G 3.28K 3.83K
CHAPTER !
CO(PL10NCE OF B0N*L0)ES B0N=
*21)EL1NES B+ NCC B0N= L1(1TE)
48
All of Commercial Ban& $CC Ban 'td. also follow and practices Baning Companies Act on
,--, regarding of Bangladesh Ban.
In the previous sections of this report we have critically analy!ed $CC Ban9s e4isting credit
ris management system as well as Bangladesh Ban9s (est practices guidelines for managing
credit ris. Comparing $CC Ban9s current credit ris management system with the BBH (est
practices guideline we see that $CC Ban lacs some of the (est practices in (aning industry
which can (e generated in the following way6
..1C,edit Poli$ie&? Lendin3 *uideline: In the a(ove analysis we have seen that $CC Ban
limited has no written credit policy though it follows some policy. As there is no written credit
policy& (ranch managers sometimes get confused whether to go with a pro%ect or not. /hus $CC
Ban limited should have a lending guideline availa(le in every (ranches so that credit officers
can tae >uic decision whether to accept or re%ect a pro%ect. /he lending guideline should
include the following6
U Industry or (usiness segment focus.
U /ypes of loan facilities
U #etails of single (orrowerJ group limit
U 'ending caps
U #iscouraged (usiness type
U 'oan facility 5arameters
U Cross Border ris
..2 C,edit 0&&e&&ment 9 Ri&k *,adin3: /hough credit is properly assessed in $CCB'& (ut
there is no ris grading system applied here. It should adopt a credit ris grading system to
ensure account management& structure and pricing are commensurate with the ris involved.
..3 0//,o%al 0utho,ity: In Bangladesh Ban9s guideline it is written that )Approval authority
should (e delegated to individual e4ecutives and not to committees to ensure accounta(ility in
approval process*. But in $CC Ban limited we see that every credit goes to the (oard via credit
committee. As a result& wastage of time occurs and no one is held accounta(le for a (ad loan.
..! Se3,e3ation of )utie&: According to Bangladesh Ban "uideline Bans should aim to
segregate the following lending functions to improve the nowledge levels and e4pertise in each
departmentB
Credit ApprovalJ Ais 0anagement
49
Aelationship 0anagementJ 0areting
Credit Administration
But in $CC Ban limited there is no such depart mention or segregation of duties. In small
(ranches of $CCB' only single loan officer do all the %o(s lie loan mareting& ris assessing
and credit administration.
...' 1nte,nal 0udit: $CC Ban limited has a segregated internal auditJ control department
charged with conducting audit of all departments as suggested (y Bangladesh (an guideline.
... P,efe,,ed O,3ani7ational St,u$tu,e: Currently $CC Ban does not follow the preferred
management structure as suggested (y BB guideline. /he ey feature in the preferred
management structure is the segregation of 0aretingJ Aelationship function from approvalJAis
managementJ Administration function.
..5 0//,o%al /,o$e&&: According to BB (est practice guideline& Qthe recommending or
approving e4ecutives should tae responsi(ility for and (e held accounta(le for their
recommendations and approval9. /he recommended delegated approval authority levels are as
follows
+ead of CreditJCA0 14ecutives up to ,8K of capital
0anaging #irectorJ C1O Up to 28K of capital
1CJ Board All e4ceed 28K of capital
But in $CC Ban we see that every credit proposal goes to 14ecutive committee
i.e.(oard.
..H C,edit 0dmini&t,ation: /he BB guidelines suggest that Credit administration (e strictly
segregated from relationship managementJ mareting. As a result the possi(ility of controls
(eing compromised or issues not (eing highlighted at the appropriate level can (e avoided. /he
credit administration has the following functions6
U #is(ursement
U Custodial duties
U Compliance re>uirement
In $CC Ban credit officers under supervision of Branch Credit In6charge or 0anager also carry
out all the three functions of credit administration. But Credit 0areting an administration is yet
to (e segregated.
..6 C,edit (onito,in3: /o minimi!e credit losses& monitoring procedures and system should (e
in place that provides an early indication of the deteriorating financial health of a (orrower. 1arly
identification& prompt reporting and proactive management of 1arly Alert Accounts are prime
credit responsi(ilities of all relationship 0anagers. An early Alert Account is one that has riss
or potential weaness of a material nature re>uiring.

50
..18 Ste/& 1n%ol%ed to San$tionin3 a Loan:
,. /he applicant needs to apply in prescri(ed application such as IFo,m 0A
2. /hen (.) three additional form to (e filled up.
In>uiry form6CIB ,A (5rovides such information as amount for fresh loan or
renews the loan.)
In>uiry form6 CIB 2A (If the applicant is an institutionM all the information to (e
provided (y the owner)
/he in>uiry form CIB6.A (Sees the applicant to supply information of group or
related (usiness concern)
.. /hen the applicant gives a list of assets which can (e ept as collateral. /he applicant will
declare in faith that such assets offered as collateral are owned (y the (usiness owner and
are not already ept as collateral to other financial institution against any sanction of loan
or credit limit.
7. /hen the (an maes the valuation of fi4ed assets (to (e ept as collateral) to (e assessed
and valued (y independent inspection services. /he inspection company su(mits the
survey report and provides an independent valuation of the assets that were offered as
collateral.
8. /hen the (an will perform a lending ris analysis or '/A. /he 'AA is a ind of
assessment where some scoring is made on various riss to which the applicant9s
(usiness or pro%ect is e4posed. /he scoring result is arriving at the level of riss of the
(usiness or pro%ect. A detailed discussion or 'AA is made later.
F. After the lending ris analysis net worth is calculated (y su(tracting total lia(ilities from
total assets. /his net worth is calculated (oth for the organi!ation and for the individuals
including the 0anaging #irectors and #irectors.
I. A prescri(ed form IFo,m BA is to (e filled in (y case of proposal for loans and advances
for individuals& proprietorship& partnership limited company(private or pu(lic)& other
(an9s loan proposal acceptance certificates. If the applicant has received any sanction of
loan or advance from other (ans a certificate showing such acceptance of loan proposed
must (e su(mitted.
51
CHAPTER 7
FINDINGS AND ANALYSIS
52
F"#d"#$%
=hile woring at $CC Ban 'td& $arayangon% (ranch& i have attained to a newer ind of
e4perience. After the collection and analysis of data& i have got some findings. /hese findings are
completely from my personal point of view. /hose are given (elowB
All types of loans and their pro(lems and prospects which provided (y $CC Ban 'td
at& $arayangong (ranch are given (elowB
1. CC y/o :Ca&h C,edit y/othe$ation;
$ational Credit And Commerce Ban 'imited security fall under this type of lending. It is a
continuous credit. It is allowed 'inder the categories.
V Commercial lending 6 when the customer is other than an industry.
V =oring capital when the customer is an industry.
P,o"lem& of the Ca&h C,edit y/othe$ation:
'engthy documentation procedure. ?or this reason many customers feel (oring to get this
type of loan.
0any customers su(mit duplicate land documents.
/his type of loan amount can not do for further investment.
P,o&/e$t& of Ca&h C,edit y/othe$ation:
+ighly secured loan.
"ain high interest from this type of loan.
#ay (y day income will (e increase for this type of loan.
2& CC P'(d$( )C*%+ C,(d"t P'(d$(- U#d(, SME
P,o"lem& of Ca&h C,edit y/o unde, S(E:
/his type of loan provided only for personal guarantee.
+ighly unsecured loan
If fault& it is difficult to recover.
53
Credit employee feels tension from this type of loan.
P,o&/e$t& of Ca&h C,edit y/o unde, S(E:
It9s repayment system are monthly. As a result after every month loan amount
decreases and also ris decrease.
Aepayment is invested in further purposes and (an earns money.
/o solve unemployment pro(lem and contri(ute S01 (usiness in Bangladesh.
3. O%e,d,aft :SO);
In this (ranch three type of SO#B
a) SO# (?inancial O(ligation)
() SO# ("eneral)
c) SO# (?#A)
P,o"lem& of SO):
'ess interest rate
P,o&/e$t& of SO):
?ully secured loan
Against ?#A& Savings and #eposits these type of loan are taen.
/o help customer in their necessity of loan without condition.
/o contri(ute customers (enefit.
/o (usinessman for e4pansion of their (usiness
7. Loan& a3ain&t ou&e Buildin3B
P,o"lem& of loan& a3ain&t hou&e "uildin3:
W #ocuments are not clear
W #ifficult to sell mortgage property when needed.
54
P,o&/e$t& of loan& a3ain&t hou&e "uildin3:
W +ighly secured loan
W Aepayment can (e further investment
W 1arn high interest rate
W Contri(ute on Country9s development
'. Con&ume, C,edit S$heme :CCS;
P,o"lem& of CCS:
Only office staff will (e (enefit these type of loan.
/hey can (uy home appliance from these loan.
0ost of the time (an will (e less (enefited from these type of loan
P,o&/e$t& of CCS:
/o motivate employee for doing wor well.
/o activate employee for (aning activities.
.. Real E&tate Finan$in3 fo, CRB:
Aeal estate financing for Construction of Aesidential Building 'oan are provided against high
document of land and properties.
P,o"lem& of ,eal e&tate finan$in3 fo, CRB:
Incorrect document
5olitical pressure
Aepayment not pay due time
55
P,o&/e$t& of ,eal e&tate finan$in3 fo, CRB:
/o increase residential (uilding
/o help people for solving accommodation pro(lem
If fault& can (e sold asset.
I. Lea&e Finan$in3:
P,o"lem& of Lea&e Finan$in3:
Ban cannot proper o(servation of their asset.
Borrowers often give incorrect statement of asset.
P,o&/e$t& of Lea&e Finan$in3:
/o help industrial production through the machinery
/o help many investor for (uying car& vehicle and other e>uipment
/o increase (aning income and contri(ute country9s development
H. S(E loan
S01 means Small and 0edium 1nterprise .
P,o"lem& of S(E:
$ot preserve hardly document
'oan provide easy condition
'oan receiver get opportunity for cheating
P,o&/e$t& of S(E:
Supporting S01 (usiness in Bangladesh
Investor are come to invest in S01 for easy loan condition
56

CHAPTER
RECOMMENDATIONS AND CONCLUSION
57
R(.o//(#d*t"o#%
?or the pro(a(le solutions of the identified pro(lems ensure (etter progress to $CC Ban in
future& some necessary steps are recommended (ellow on the (asis of collected data& o(servation&
e4pert staffs opinion and my nowledge and %udgment.
Bans always contri(ute towards the economic development of a country. Compared with other
(ans $CC Ban 'td. is contri(uting more (y investing most of its funds in fruitful pro%ects
lending to increase in production of the country.
Fo, Ca&h C,edit y/othe$ation loan procedure time should (e decrease so that customers get
loan easily and >uicly. #ocument %ustification process can (e easy if employ a lawyer so that
>uicly %ustify document and a(le to provide loan.
Fo, Ca&h C,edit Pled3eA& repayment amount should (e further invest and always careful so that
customer can9t (e a(le to default.
Fo, SO) :O%e,d,aft&; promote customers to do ?#A& #5S so that customers tae loan against
?#A and #5S. It is fully secured for (ans and customers give less interest from other loan.
Fo, Loan 03ain&t ou&e Buildin3 Credit officer should chec all documents perfectly so that
when will (e needed it can (e sold.
Fo, Con&ume, C,edit S$heme (an try to increase loan amount so that employee can (uy as
they need and feel happy and wor hardly.
Real E&tate Finan$in3 fo, CRB +igh rise (uilding increase day (y day and also increase real
estate financing for future purpose (an should increase loan and chec all document which are
provided (y the organi!ation.
Fo, Lea&e Finan$in3 0any fields (ans provide lease financing (ut can9t a(le to see all time
their lease asset. So (ans should employ e4tra employee so that he Jshe can (e a(le to see lease
items.
58
Fo, S(E Baners should provide loan and go customer (usiness and give advice so that they
increase their (usiness and can give repayment perfectly.
Co#.'0%"o#
/oday9s (usiness is very competitive and comple4. /o survive in the related sector the
organi!ation need competitive people and has to tae some effective policy. 1very country must
have a plan for important role in economic activities. Bangladesh is no e4ception of that.
Commercial Bans9 financial development and economic developments are closely related.
/hat9s why the private commercial (ans9 are playing significant role in this regard.
/he $ational Credit and Commerce Ban 'imited ($CCB') is one of the (est Bans in respect
of service& profita(ility and strength among the private commercial (ans9 in our country and
also to play a catalyst role in the formation of capital maret. $ational Credit and Commerce
(an 'imited (ears a uni>ue history of its own.. Its various deposit and credit products have also
attracted the clients6(oth corporate and individuals who feel comfort in doing (usiness with the
Ban.
/he $ational Credit and Commerce Ban 'imited ($CCB') is now (een called a modern (an
that undertaes all its operations at an international standard. Over the years& $CCB' has (uilt
itself as one of the pillars of Bangladesh9s financial sector and is playing a pivotal role in
e4tending the role of the private sector of the economy.
1ach and every (an has got its own credit policy which generally promulgated on the (asis of
prevailing countries socio economic conditions& political and other related aspects from time to
time as per guideline of central (an. $CC Ban limited have formulated own policy indicating
the areas of lending complied (y Bangladesh Ban guideline. /he main features of credit policy
of $CC Ban 'td focus on the following areasB
/rade and Commerce
Industry
'easing ?inancing
Consumer ?inancing
Small @ 0edium 1nterprise (S01) ?inance.
59
Agricultural @ Agro (ased Centures
+ousing 'oan Scheme
Aeal 1state @ Civil Construction
60

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