Uttara Bank

The Overall Banking System of Uttara Bank
INTERNSHIP REPORT ON
The Overall Banking System.
Submitted To:
Mrs.Rabeya Rahaman Lecturer Department Business Administration Shaikh Burhanuddin Post Graduate College
Submitted By:
Md.Ohidul Hassan Roll no - 060461 Reg no - 699151 Major Marketing Department of Business Administration Sheikh Bhorhan Uddin Post Graduate College
Letter of Transmittal
To Mrs.Rabeya Rahaman Lecturer Department Business Administration Shaikh Burhanuddin Post Graduate College
Subject: Submission of Internship Report. Dear Madam, This is with great pleasure for me to submit the Internship report, which is a partial requirement for the degree of Bachelor of Business Administration. I have done my Internship on The Overall Banking System Of Uttara bank limited (UBL) . This report gave me the opportunity to apply the theoretical knowledge in real life situation, which would be a great help for me in the future. I sincerely hope that you will enjoy reading this report and can have at least idea regarding my point of view toward developing banking system that is used by Uttara Bank. I would be happy to clarify any part of this report whenever necessary. Last but not least, I appreciate this opportunity to show my profound gratitude to you for sparing your valuable time, guidance, constant effort and prompt attention as and when required for accomplishing this report.
Yours Sincerely, ---------------------------
Certificate
This is to certify that the Internship Report on The Overall Banking System Of Uttara bank limited (UBL) with special reference to Accounts section. Submitted for the award of the degree of Bachelor of Business Administration (B.B.A) from Shaikh Burhanuddin Post Graduate College.This report is a record of research on a specific topic carried out by Mrs.Rabeya Rahaman my supervision. No part of the Internship Report has been submitted for any degree, Diploma, title or recognition before.
He is permitted to submit the Internship Report.
............................................
Supervisor Mrs.Rabeya Rahaman Lecturer Department Business Administration (BBA) Shaikh Burhanuddin Post Graduate College Dhaka
Declaration
I am Md.Ohidul Hassan Roll- 060461,Student of Bachelor of Business Administration (B.B.A Program) major in Marketing of Shaikh Burhanuddin Post Graduate College.I hereby declare that the Internship Report on The Overall Banking System Of Uttara bank limited (UBL) with special reference to Accounts section. has not been submitted by me before for any degree, diploma, title or recognition.
Acknowledgements
Initially, I would like to thank the almighty Allah for giving me the strength to complete this Internship Report. Then to say that I cloud not be able to complete this report without the help of same honorable persons who give me proper guideline to go ahead. First I like to express my deepest sense of gratitude to my honorable Mrs. Rabeya
Rahaman For his endeavor approach and outstanding supervision by which I earned a
lot of practical knowledge. Individual efforts alone can never contribute in totality to a successful completion of any venture. I would be fail in my duty if I did not state my gratitude and appreciate to the following individuals who have made valuable contribution toward this report. I am every grateful to Mr. Md. Kalim Ullah (Assistant General Manager) Branch Manager, North Shahjahanpur Branch, Uttara Bank Limited, for kindly accepting me for practical orientation program in his bank for which I get this opportunity to learn about General Banking, Accounts, Credit and necessary things. I am also very grateful to Second Officer Mr. Md. Abdul Barique (S.P.O), Mr. Nazrul Islam (P.O), Mr. Syed Shah Alam (P.O)L.P.R, Mr. Md. Harun Or Rashid (P.O)Cash, Mrs. Salma Khatun (Sr.Officer), Md. Abdul Azim (OG-11), Rozina Mostofa (OG-11), Mrs. Fowzia Jesmin (A/O)Cash, Abu Musa Sibli Sadik (A/O)Cash, Md. Samiruddin (A/G). For their supporting role and all other employees of Uttara Bank Limited North Shahjahanpur Branch for their sincere cooperation, careful supervision and unparallel encouragement. Last of all, I convey my profound gratitude to all the faculty members of institute of BBA Department because their teaching in the last four years in the various courses has enabled me to do this report. At last, I would also like to thank especially my parents for their continuous support. Thanks for all from the core of my heart.
Executive Summary
This internship report is a partial requirement for the Bachelor of Business Administration. As a part of the internship program, I was placed at General Banking, Accounts, Cash, Credit and related problems of Uttara Bank Limited, North Shahjahanpur Branch in Dhaka. During the three-month long internship I have leaned a lot about commercial banking operations of this organization. This report not only explores Uttara Banks activities as one of the leading nongovernment companies, but also highlights the role of Uttara Bank Limited in the financial sectors of Bangladesh. Uttara Bank Limited is a private commercial Bank which is one of the most popular banks in Bangladesh. The Bank started its operation from In 1971, Bangladesh, which was East Pakistan, emerged as an independent country. It immediately nationalized all the banks excepting 3 foreign banks. Six nationalized banks were thus formed. In 1983 a new industrial policy was implemented allowing private sector participation in industrialization. As a part of this process, two nationalized commercial banks were again denationalized and a number of private commercial banks were allowed operating. Banks play a very important role in important role in international trade. Now a day no country can thrive without international trade. Moreover banks provide some other nontraditional services like factoring, issuing guarantees; when are very much supportive to modem business.
Table of Contents Chapter

No. Title No.
1.1 Orientation of The Report 1.2 1.3 1.4 1.5 1.6 2.2 2.3 2.4 2.5 2.6 2.7 2.8 3.1 (General activities of the organization) 3.1.1 3.1.2 3.1.3 3.1.4 3.1.5 3.1.6 3.1.2 3.3
Content Title
Background of the study Rationale of the study Objectives of the report Scope of the report Limitations of the study Methodology Mission, Vision, strategy statement Composition of the board Capital and Reserve Management structure Key figures Balance Sheet Profit and loss account (Income
Page
3 3 4 4 5 5 10 12 14 15 18 26 28
Chapter
01
Statement) General banking Account opening section

Document for opening some special account
32 32 33 34 34 35 35 36 36
Chapter
Limited company Club society Savings account individual or joint Other products and service Remittance in Bangladesh Local Remittance
3.3.1 3.3.2 3.3.3 3.3.4 3.4 3.5 3.6 3.7 3.8 3.9 3.10 3.10.1
The Overall Banking System of Uttara Bank 37 Pay order issue Demand draft issue Telegraphic transfer Mail transfer Clearing section Cash section Dishonor of cheques Deposit section Closing accounts Accounts section Credit and Risk Management (CRM) Loans and Advances 39 40 41 42 43 44 45 49 50 57 58
4 .1 Analysis of the
Analysis More & more emphasize have to be given here on analyzing the issues from different perspective,
78
main topic
Chapter
like as, SWO, trend, Statistical, mathematical and others analysis. 4 .2 Findings
86
5 .1 (Concluding Chapter) Chapter 5 .2
Recommendation Conclusion
88 89
Bibliography Chapter 6
91
Chapter One
Orientation of the Report
Chapter One
1.1:Background of the Study 1.2: Rationale of the Study 1.3: Objective of the Report 1.4: Scope of Report 1.5: Limitation of the Report 1.6: Methodology
10
1.1:Background of the Study

Uttara Bank-one of the largest and oldest private-sector commercial bank in Bangladesh, with years of experience. Adaptation of modern technology both in terms of equipment and banking practice ensures efficient service to clients. 211 branches at home and 600 affiliates worldwide create efficient networking and reach capability. Uttara is a bank that serves both clients and country.
The internship program is itself an attempt to provide graduates an orientation to a real life situation in which they can observe and evaluate the use and applicability of theoretical concepts which were taught in the classroom. As per norm, this report is the requirement of fulfillment of the internship program as well as of BBA program. This internship report on Uttara Bank Limited is prepared to fulfill the partial requirement of the internship program as full credit subject of the BBA program of Shaikh Burhanuddin College. In Bangladesh today financial sector is one of the most establish area. For the aspects of economic development, banking sector must be reform. So it is necessary to form a good economic system. Private Banks are paling an important role compare to the government banks in the country. For this reason I prepared my internship report on Uttara Bank Limited.
1.2: Rationale of the Study

I was asked to work on Finance of Bank Product, Development, and Limitation in the Uttara Bank Ltd. (UBL) at North Shahjahanpur Branch, Dhaka. Bank plays an important role in the business sectors and in the industrialization of a country. Banks take deposits from the customers against interest and lend it to the borrowers against interest for a time being. To perform these functions bank has to do a lot of works such as deposits collection, loans and advances appraisal and management system, foreign exchange transactions, general banking etc. Hence these issues of banking have been selected for study. The banks works within some conceptual frameworks such as GAAP & IAS, which are guidelines of the whole process. So the application of GAAP & IAS in the preparation of financial statements is very important.
11
1.3: Objective of the Report. Primary objective:
To fulfill the partial requirement of the internship program as full credit subject
of the BBA program. This report is to provide a general description of the initial and present status of Uttara Bank Limited
Secondary objectives:
To know the operation of commercial banks in Bangladesh. To describe the customer service process of Uttara Bank Limited. To analyze the barriers faced by the banks in Bangladesh. To suggest a supportive role in the progress of baking system in financial sector.
1.4: Scope of Report.

This report covered the over all banking system of Uttara Bank Limited. Such as-
In this report only include the relationship of the customer with the bank as well as
the principals covered by the bank as a general banking system.
The management of the Products and Services of UBL. The process of Segmentation, Targeting and Positioning for its offerings. The overall Pricing strategies and tactics followed by UBL authority. The analysis of Strengths and Weaknesses of the UBL in comparison to its
competitors.
Based on the analysis, the report will describe the objectives and states few
recommendations to add cluster with the organizations present management of the delicate marketing efforts. 12
1.5: Limitation of the Report.

The report was completed under certain constrains which were: Difficulty in communication and gaining accesses to financial sector. Non-availability of the most required data. Inexperience was one of the most important factors that have constituted the limitation of the study. So due to inexperience, the required approach might not be followed to prepare this report. For the restriction to disclose various information of a Bank. So for this it was a great difficulty in preparing the report
1.6: Methodology.
This report was followed by descriptive studies and partially causal studies and based on empirical method. It is descriptive studies because I covered the financial aspects of UBL and causal studies because the report prepares must follow some specific methods.
Sources of Data.
All the relevant data are collected by both primary and secondary data. For this report I have to take personal interview of the Executives of UBL for primary data. I also included the annual report of Uttara Bank Limited that was provided by the Head Office. I used journals, brochure, manuals and several books on Finance and Banking to prepare this report.
Data Analysis Method.

The report mainly cover a particular Bank like Uttara Bank Limited and the data is collect from the head office and Uttara Bank (North Shahjahanpur Branch), analyzed the data to find out the required information. I used necessary number of table, chart, and graph to present the report. Ms-Word, Excel or any required computer program used to process the Quantitative data and based on this data analysis the final report was prepared.
13
Chapter Two
Background of the organization
14
Chapter Two
2.2: Vision/Mission, Strategies Statement 2.3Composition of the Board 2.4Capital and Reserve 2.5 Management Structure: 2.6 Key figures 2.7 Balance Sheet 2.8 Profit And Loss Account
2.2: Vision/Mission, Strategies Statement

15
The Overall Banking System of Uttara Bank The bank has some mission to achieve the organizational goals. Some of them are as follows The bank looks forward with excitement and a commitment to bring greater benefits to customers. Uttara Bank Limited provides high quality financial services to strengthen the well-being and success of individual, industries and business communities. Its aim to ensure their competitive advantages by upgrading banking technology and information system. UBL intends to play more important role in the economic development of Bangladesh and its financial relations with the west of the world by interlinking both modernistic and international operations. The bank intends to meet the needs of their clients and enhance their profitability by creating corporate market. The Bank has remained dynamic in its continued efforts to improve & increase core competence & service efficiency by constantly upgrading product quality, service standards, protocol and their effective participation making use of state of the art technology. The bank creates wealth for the shareholders The bank believes in strong capitalization. Its maintain high standard of corporate and business ethics. UBL extend highest quality of services, which attracts the customers to choose them first.
2.3Composition of the Board

16
Mr. Azharul Islam
Iftekharul Islam
Mr. Md. Mahfuzus Subhan Mr. Sarwar Boudius Salam Mr. Abu Hossain Siddique Mr. Abul Barq Alvi Mr. Faruque Alamgir Col. Engr. M. S. Kamal(Retd.)
Prof. Mirza Mazharul Islam Prof. Sharif Md. Shahjahan Mr. Syed A. N. M. Wahed Mr. Mustafizur Rahman Mr. Shah Habibul Haque
17
Mr. Shamsuddin Ahmed
Chairman Vice Chairman Directors
Mr. Azharul Islam Mr. Md. Asaduzzaman Mr. Md. Mahfuzus Subhan Mr. Sarwar Boudius Salam Mr. Abu Hossain Siddique Mr. Shah Habibul Haque
Managing Director
Mr. Shamsuddin Ahmed
Managing Directors since 1965
2.4 Capital and Reserve Share Capital: The Authorized Capital of the Bank increased from Tk 1,000.0
million to Tk. 1,600.00 million during the year 2008. But the bank has already got approval from Bangladesh Bank to raise its Authorized Capital from Tk. 1,600.00 18
The Overall Banking System of Uttara Bank million to Tk. 3,200.00 million. The paid up capital of the Bank has been increased to Tk.798.7 million from Tk.399.3 million due to declaration of 100% bonus share in 2008. The total number of shares was 79, 86,592. The Government of the Peoples Republic of Bangladesh, five Banks and fifty two financial institutions held total 6, 31,400 shares worth Tk. 631, 40,000.00 and remaining 27,170 private Shareholders held total 73, 55,192 shares worth Tk. 73, 55, 19,200.00. The total equity of shareholders of the Bank at the end of the year 2008 stood Tk. 3,688.8 million and in 2007 stood Tk. 2,453.5 million.
Reserve Fund: The Reserve Fund increase to Tk 2,890.2 million during the year by
registering 40.70 percent increase over last years tk. 2,054.2.
2.5 Management Structure: ORGANIZATION HIERARCHY OF UTTARA BANK LTD

Managing Director Deputy Managing Director Asst. Managing Director General Manager Deputy General Manager Asst. General Manager Senior Principal Officer Principal Officer Senior Officer Grade -1 Officer Grade -2 19
2.6 Key figures

Human Resources Division Personnel Department
Test Key Department
Disciplinary Department
Marketing Division Business Development Department Branches Department
Engineering Department Public Relations Department
Credit Risk Management Divisio n
Credit Approval Department
Credit Admin & Monitoring Department
Credit Marketing Depa rtment
Credit Recovery Department
20

Central Accounts Division Accounts Department Reconciliation Department
Central Accounts Division Accounts Department Reconciliation Department
Internal Control & Compliance Division
Audit & Inspection Department
Monitoring Department
Compliance Department
Central Accounts Division
Accounts Department
Reconciliation Department
21
Internal Control & Compliance Division
Audit & Inspection Department
Monitoring Department
Compliance Department
International Division Treasury Division
Regional Offices
Dhaka Central Zone Narayanganj Zone Dhaka North Zone Mymensing Zone Dhaka South Zone Chittagong Zone
22
Sylhet Zone Khulna Zone
The Overall Banking System of Uttara Bank Bogra Zone Rajshahi Zone
Barishal Zone
Comilla Zone
UBL Networks
Local Office Regional Office Worldwide Affiliates Total Branches Authorized Dealer Branches Computer Lab Treasury & Dealing Room Training Institute Man Powe Man Power 2 15 600 211 38 1 1 1 3562
Branches Map:
23
2.7 BALANC SHEET

UTTARA BANK LIMITED
24

BALANCE SHEET AS AT 31 DECEMBER 2009-2010
2009 2010 Taka
PROPERTY AND ASSETS Cash

In Hand (including foreign currencies) Balance with Bangladesh Bank and its agent Bank (including foreign currencies)
Notes 03
Taka
5,860,103,625 1,585,554,764 4,274,548,861
5,002,561,855 1,713,064,194 3,289,497,661 1,121,909,129 800,727,487 321,181,642 30,000,000 14,455,780,134 14,381,918,295 73,861,839
..
Balance with other Banks and financial institutions

In Bangladesh Outside Bangladesh
04
350,941,308 6,930,615 344,010,693
Money at call and short notice Investments

Government Others
05 06
29,900,000 11,188,289,669 11,091,865,330 96,424,339
Loans and Advances

Loans, cash credits, over drafts etc. Bills discounted and purchased
07
37,141,342,619 33,308,029,435 3,833,313,184
28,477,407,266 25,298,004,729 3,179,402,537 1,013,985,359 2,758,688,987 52,860,332,730
Fixed assets including Land, Building, Furniture and Fixtures Other Assets Non Banking Assets
TOTAL ASSETS LIABILITIES AND CAPITAL / SHARE HOLDERS' EQUITY
08 09 9.1
1,065,679,827 2,698,386,497 109,688,573 58,444,332,118
Liabilities
Borrowings from other Banks, Financial Institutions and Agents
10 11
225,086,084 50,816,975,020 15,570,321,322 1,605,516,899 19,547,765,743 12,164,269,906 1,929,101,150
2,899,505,333 43,586,356,057 12,372,373,980 1,643,287,611 17,876,529,810 10,417,183,199 50,000 1,276,931,457 3,920,914,181 50,406,775,571
Deposits and other accounts

Current and other accounts etc. Bills payable Saving bank deposits Fixed deposits Bearer certificate of deposit Other deposits
Other liabilities
TOTAL LIABILITIES
12
3,713,428,714 54,755,489,818
25

CAPITAL/SHARE HOLDERS' EQUITY Issued, subscribed and paid up capital Issuance of bonus shares Statutory reserve Other reserves Retained earnings 13.2
798,659,200 1,550,837,039 1,337,631,167 1,714,894 3,688,842,300 58,444,332,118 8,806,887,103

-
399,329,600 399,329,600 550,837,039 1,100,864,198 3,196,722 2,453,557,159 52,860,332,730 8,830,513,784

-
14 15 16
TOTAL CAPITAL/ SHARE HOLDERS' EQUITY TOTAL LIABILITIES AND CAPITAL/SHARE HOLDERS' EQUITY
CONTINGENT LIABILITIES Acceptances & endorsements Letter of guarantees Irrevocable letter of credit Bills for collection Other contingent liabilities
17.0 17.1 17.2 17.3 17.4
1,826,856,510 4,517,171,591 3,156,536 2,459,702,466
1,474,352,134 5,382,511,516 3,140,634 1,970,509,500
OTHER COMMITMENTS Documentary credits and short term trade related transactions Forward assets purchased and forward Deposits placed Undrawn note issuance and revolving underwriting facilities Undrawn formal standby facilities, credit lines and other commitments Liabilities against forward purchase & sale Litigation filed by the Bank
TOTAL OTHER COMMITMENTS
TOTAL OFF- BALANCE SHEET ITEMS

INCLUDING CONTINGENT LIABILITIES
8,806,887,103
8,830,513,784
2.8 PROFIT AND LOSS ACCOUNT

UTTARA BANK LIMITED
26
The Overall Banking System of Uttara Bank PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2009-2010
2009 Taka 2010 Taka
Notes OPERATING INCOME Interest Income Interest paid on deposits, borrowings etc. Net Interest Income Income from Investment. Commission,Exchange and Brokerage Other Operating Income
18.1 19 20 21 22
Total operating income

OPERATING EXPENSES Salary and allowances. Rent, taxes,insurance,electricity etc. Legal expenses Postage,stamp,telecommunication etc. Stationery,printing,advertisements etc. Managing Director's salary & allowances and fees Directors' fees and expenses Auditors' fees Repair, maintenance and depreciation of Bank's property Other expenses
4,084,288,089 2,200,521,205 1,883,766,884 784,896,516 907,895,386 431,106,660 4,007,665,446 1,272,357,540 151,877,811 9,429,329 39,680,054 51,324,787 6,424,333 2,264,000 250,000 107,256,133 166,472,931 1,807,336,918 2,200,328,528 105,289,644 2,305,618,172 207,500,000 92,550,000 57,450,000 55,000,000 2,500,000 2,098,118,172 959,600,000 940,000,000 19,600,000
1,138,518,172
2,997,432,877 1,876,351,450 1,121,081,427 921,189,131 744,994,717 356,650,099

3,143,915,374
23 24 25 26 27 28 29
1,158,073,662 188,502,215 11,544,740 48,215,055 40,275,975 5,060,000 1,916,000 130,000 85,308,986 138,653,184 1,677,679,817 1,466,235,557 1,466,235,557 322,500,000 255,800,000 44,200,000 20,000,000 2,500,000 1,143,735,557 734,200,000 727,000,000 7,200,000
409,535,557
30 31
Total operating expenses

Operating profit Add: Profit on sale of fixed asset
32
Profit before provision Provision

Provision for loans & advances Provision for off balance sheet exposures Provision for outstanding unreconciled entries
33
34
35
Transfer to gratuity fund Transfer to benevolent fund Profit before tax Provision for Tax Current tax
Deferred tax
Profit after tax Retained surplus brought forward Profit available for appropriation Appropriations
Statutory reserve General reserve Issue of bonus share Retained earnings
16
Earning per share (EPS)
40
3,196,722 1,141,714,894 1,140,000,000 1,000,000,000 140,000,000 1,714,894 142.55
22,990,765 432,526,322 429,329,600 30,000,000 399,329,600 3,196,722 51.28
2.16: CASH FLOW Statement

UTTARA BANK LIMITED
27

CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2009-2010 Particulars A. Cash flows from operating activities Interest received Interest paid Dividend received Fees, commission & exchange received Recoveries of loans previously written off Cash paid to employees Cash paid to suppliers Income tax paid/adjustment Received from other operating activities Payments for other operating activities
Cash generated from operating activities before changes
Notes
2009 Taka
2010 Taka
36
4,799,748,773 3,936,910,026 (2,200,521,205) (1,876,351,450) 23,588,570 16,648,690 907,895,386 744,994,717 3,301,343 (1,278,781,873) (1,162,793,662) (58,060,381) (46,182,229) (786,931,386) (717,853,962) 431,106,660 356,650,099 (449,246,922) (356,040,511) 1,388,797,622 899,283,061 (3,268,836,413) 141,888,315 1,278,445,559 (3,266,583,619) 100,000 (8,663,935,353) (3,313,550,245) 783,392,565 555,995,056 76,282,903 73,963,121 7,154,336,060 4,152,185,748 (25,231,983) 26,227,577 (3,872,226,164) 1,913,650,677 (1,880,038,791) 1,041,171,376
in operating assets and liabilities Increase/(decrease) in operating assets and liabilities Statutory deposits Purchase/sale of trading securities Loans and advances to other banks/Money at call & short notice Loans and advances to customers ( other than Banks) Other assets 37 Deposits from other Banks/borrowings Deposits from customers (other than Banks) Other liabilities on account of customers Other liabilites 38 Net Cash received / (used) from operating activities Cash flows from investing activities Proceeds from sale / payments for purchase of securities Purchase of property, plants and equipments Sale of property, plants and equipments Purchase/sale/Adjustment of subsidiary Net Cash received / (used) in investing Activities Cash flows from financing activities Received from issue of loan capital and debt securities Repayment of loan capital and debt securities Received from issue of ordinary shares Dividend paid Dividend distribution tax Net cash received / (used) from financing activities
Net (Increase) /decrease in cash & cash equivalents (A+B+C) Effects of exchange rate changes on cash and cash-equivalents
B.
1,994,620,606 (1,625,596,994) (188,474,399) (134,565,821) 163,428,107 365,327 2,614,126 (2,681,155) 1,972,188,440 (1,762,478,643) 92,149,649 6,132,593,284 6,224,742,933 1,585,554,764 4,274,548,861 350,941,308 13,698,000 6,224,742,933 (39,932,960) (39,932,960) (761,240,227) 6,893,833,511 6,132,593,284 1,713,064,194 3,289,497,661 1,121,909,129 8,122,300 6,132,593,284
C.
D. E. F. G.
Opening cash and cash equivalents Closing cash and cash-equivalents (D+E+F) Cash and cash equivalents at end of the year Cash in hand (including foreign currencies )
Bal. with Bangladesh Bank & its agent Banks (including foreign currencies) Balance with other banks and financial institutions (note-4 )
39
Prize bonds
28
Chapter Three
General Activities of the organization
Chapter Three
3.1: General banking 29
The Overall Banking System of Uttara Bank 3.1.1: Accounts Opening Section. 3.1.2: Documents for opening some special account 3.1.3: Limited Company 3.1.4: Clubs/ Association/ Society etc. (Non-Trading Concerns) 3.1.5: Savings account Individual or joint 3.1.6: Other products and services 3.2: Remittance in Bangladesh 3.3: Local Remittance 3.3.1: Payment Order Issue (P/O): 3.1.2: Documents for opening some special account 3.3.3: Telegraphic Transfer: 3.3.4: Mail Transfer Advice (MTA): 3.4: Clearing section . 3.5: Cash section 3.6: Dishonor of Cheques/ Instruments 3.7: Deposit Section 3.8: Closing of Accounts 3.9: Account Section 3.10: Credit and Risk Management (CRM) 3.10.1: Loans and Advances
3.1: General banking

30
The Overall Banking System of Uttara Bank General Banking is the starting point of all banking operation. It is a combination of activities of different sections. General banking has some section in the bank. These sections are as follows: Accounts Opening Section. Cash Section. Clearing Section. Remittance Section. Accounts Section. Others.
3.1.1: Accounts Opening Section.

Opening account with a bank is the way of creating a banker customer relationship. In other words, it is a contract between banker and customer. With this contract, bankers enter into certain obligations and responsibilities. Proper introduction serves as a precaution against fraud and forgeries and safeguard against inadvertent overdraft to bank. Obtaining proper introduction may absolve the banker from the charges of negligence for conversion. So, while opening a new account, emphasis would be given without exception to introductory reference and inquiry. The following instruction to be followed while opening account: -
1) Introduction of Account to be obtained from a respectable client acceptable to bank. 2) The introduction shall be obtained in writing in the respective column of Account opening form. 3) For opening savings bank account of individual either singly or jointly, passports and identity cards may be accepted for introduction, but subsequently proper introduction may be obtained. 4) Introduction of Current Account by members of the staff may be allowed but shall be discouraged as far as possible. 5) Current Account shall preferably be introduced by another Current Account holder acceptable to bank.
31
3.1.2:Documents for opening some special account

The following documents duly completed shall be obtained from the customer at the time of opening different types of accounts as applicable: A. Individual/ joint. a. Account opening form as applicable duly filled in. b. Specimen Signature Card. c. Two photographs duly attested by introducer. d. Nominee Form (if nomination given by the account holder). e. Mandate or Authority Form (if a third person is authorized to operate the account). B. Proprietorship Firm a. Account Opening Form. b. Specimen Signature Card. c. Copy of Trade License d. Two photographs duly attested by introducer. e. Proprietorship Rubber Stamp against all signatures of the proprietor. C. Partnership Concern a. Account Opening Form. b. Specimen Signature Card. c. Copy of Trade License d. Partnerships Deed e. Two photographs of each partner duly attested by introducer. f. Partnership Rubber Stamp against all signatures of partners operating the accounts. g. Partnership letter.
3.1.3:Limited Company
32
A. Private Limited Company.

a. Account Opening Form. b. Specimen Signature Card. c. Copy of Trade License. d. Copy of Memorandum and Articles of Association duly attested by the Managing Director/ Chairman of the Co. e. Certificate of Incorporation. f. List of Director as per return of Joint Stock Company with signature.
B. Public Limited Company

a) Account Opening Form. b) Specimen Signature Card. c) Copy of Trade License. d) Photograph of Directors and account operators other than Director. e) Certified copy of Memorandum and Articles of Association. f) Certificate of commencement of business. g) List of Directors as per returns of Joint Stock Company with their signature. h) Resolution of the Board for opening account with the Bank. i) Certification of incorporation.
3.1.4:Clubs/ Association/ Society etc. (Non-Trading Concerns)

a) Account opening Form for current account or SB accounts. b) Specimen Signature Card. c) Certified copy of Bye laws/ constitution of the organization. d) List of the Executives of Managing Committee with their signature and present and permanent address. e) Resolution of the Committee for opening account with the bank. f) 2 Photographs of each operator of the account.
3.1.5: Savings account Individual or joint

Account opening form as applicable duly filled in. 33
The Overall Banking System of Uttara Bank Specimen Signature Card. Two photographs duly attested by introducer. Nominee Form (if nomination given by the account holder). Mandate or Authority Form (if a third person is authorized to operate the account).
A. Corporation/ Autonomous Bodies/ Govt. Organization

a) Account Opening Form as applicable. b) Specimen Signature Card. c) Copy of the Act or Ordinance Showing authority to open account. d) Letter from the authorized persons in absence of the Board.
B. Account Of Constituted Attorney

a) Account Opening Form (As applicable) b) Specimen Signature Card c) Power of Attorney
3.1.6: Other products and services

Along side traditional banking product and services, the bank has some tailor made products in liability and asset sides. Of those mentionable are Monthly Savings Scheme and Double Benefit scheme etc. for deposit mobilization in one hand and consumer credit scheme, lease finance, personal loan, Uttaran house repairing and renovation Scheme and SME financing in other hand. Besides, the Bank has also some electroproducts based on information technology of which Q-cash UBL ATM Debit cards are to be mentioned for providing 24 hours services to customers.
3.2: Remittance in Bangladesh

34
The Overall Banking System of Uttara Bank Remittances have emerged as a key driver of economic growth and poverty reduction in Bangladesh, increasing at an average annual rate of 19 percent in the last 30 years (19792008). Revenues from remittances now exceed various types of foreign exchange inflows, particularly official development assistance and net earnings from exports. The bulk of the remittances are sent by Bangladeshi migrant workers rather than members of the Bangladeshi Diaspora. Currently, 64 percent of annual remittance inflows originate from Middle Eastern nations. Robust remittance inflows in recent years (annual average growth of 27 percent in FY06FY08) have been instrumental in maintaining the current account surplus despite widening a trade deficit. This in turn has enabled Bangladesh to maintain a growing level of foreign exchange reserves.
3.3: Local Remittance

Remittance refers to sending of money that is the process of sending money from one place to another is called remittance. Banks remit funds one place to another through the network of their branches. The main instrument for remittance of funds is drafts, mail transfer, telephone transfer and travelers cheques.
3.3.1: Payment Order Issue (P/O):

35
The Overall Banking System of Uttara Bank The pay order is an instrument issued by bank, instructing itself a certain amount of money mentioned in the instrument taking amount of money and commission when it is presented in bank. Only the branch of the bank that has issued it will make the payment of pay order. Issuing of Pay Order: The procedures for issuing a Pay Order are as follows: Deposit money by the customer along with application form. After filling the form carefully, the customer is pays the money in cash or by cheque. The concerned teller then issue PO on its specific block. This block has three parts, one for bank and another two for customer. A/C payee crossing its sealed on all PO issued by the bank. The teller then Writes down the name and address of the beneficiary on the main part of the PO block. In other two part name and address of the customer is written. The teller gives an entry to the registry book and maintains the same number of PO block. Two authorized officer signed the PO block. Give necessary entry in the bills payable (Pay Order) register where payees name, date, PO no, etc is mentioned. prepared the instrument. after scrutinizing and approval of the instrument by the authority, it is delivered to customer. Signature of customer is taken on the counterpart. Different modes of PO when a customer can purchase: By cash: Cash A/C Debit Bills payable (PO) A/C Credit. Income on commission A/C Credit. By account: Customers A/C Debit Bills payable (PO) A/C Credit. Income on commission A/C Credit. By transfer: SBL General/ other Dept Clients A/C Debit 36
The Overall Banking System of Uttara Bank Bills payable (PO) A/C Credit. Income on commission A/C Credit. PO A/C is the current liabilities of bank, which is acquired to be discharged by beneficiaries against cash or through an account. Settlement of a PO: When PO submitted by collecting bank through clearing house, the issuing bank gives payment. Bills payable (PO) A/C Debit SBL General A/C Credit. But before giving payment it is duty for issuing to observe whether endorsement was given by the collecting bank or not, then the instrument is dishonored and marking Endorsement required. Cancellation of a Pay Order: If a buyer wants to cancel it, he should submit a letter of instrument in this regard and also return the instrument. Accounting treatment: Adjustment entry wills beBills payable (PO) ---------------Dr. Customer A/C------------------Cr. When PO is lost If the instrument is lost, the holder will inform to the issuing bank immediately. Bank will mark stop payment on the Bills payable (PO) Register. Buyer will then ask for a new instrument by submitting a GD copy, and indemnity bond. A new instrument will be delivered. Entry for Pay Order Particular Cash/ Customer A/C Pay Order A/C Income on Commission A/C VAT Dr. xxxxx xxxxx xxxxx xxxxx Cr.
3.3.2: Demand Draft:

37
The Overall Banking System of Uttara Bank The person intending to remit the money through a Demand Draft (DD) has to deposit the money to be remitted with the commission which the banker charges for its services. The amount of commission depends on the amount to be remitted. On issue of the DD, the remitter does not remain a party to the instrument: i) Drawer branch ii) Drawee branch iii) Payee. This is treated as the current liability of the bank as the banker on the presentation of the instrument should pay the money. The procedures for issuing a DD are as follows: Customer is supplied with DD form. Customer fill up the form, which includes the name of the drawer, name of the payee, amount of money to be sent, commission, name of the drawee branch, signature and address of the drawer. The customer may pay in cash or by cheques from his accounts (if any). After the money is paid and the form is sealed and signed accordingly it is given to the DD issuing desk. Upon block have two parts one for bank and another for customer. Bank part contains issuing date, drawers name, payees name and some of the money and name of the drawee branch. After finishing all the required information entry of the DD is given in the DD issuing register and at the same time bank issues a DD confirmation slip is entered into the DD advice issue register and a number is put on the confirmation slip form the same register. Later the bank mails this advice to the drawer branch.
A bank draft is an unconditional order issued by one branch of a bank on its branch to pay a certain sum of money to the named person or order of demand. Hence a bank draft is always payable on demand it is a also known as demand draft (DD) Essential Features of Bank Draft:
It is drawn by one office of a bank upon some other office of the same bank. It is payable on demand. Its payment is to be made to the person whose name is mentioned there in or
according to his order in other words, it cannot be made payable to the bearer.
3.3.3 Telegraphic Transfer:
38
The Overall Banking System of Uttara Bank Telegraphic transfer (TT) is another widely used mode for remittances of funds. In case of telex transfer the message for transfer of funds is communicated through tested telex. SBL generally recovers from the telex charges in addition to the usual service charges. Issuing of TT: SBL follows the following procedures: The customer deposits money with SBL to be sent. The customer obtains a cash memo containing TT serial number. TT serial number, notifying part name is mentioned in the telex message. The Telex Department confirms transmission of the telex. Customer fills the TT form and pays the amount along with commission in cash or by cheques. Accounting entries for TT: Cash A/C Clients A/C -----------------------Dr. SBL General A/C ---------------Cr. Procedures for the incoming TT: After receiving the telex, it is authenticated by test. TT Serial number is verified by the TT in-Concern branch register. The following entries are given in the vouchers: SBL General A/C ---------------------------------Dr. Clients A/C-------------------------------------------Cr. Charges for TT: The concerned officer issues a coast memo after receiving the TT form with payment seal, Up to 25000TK exchange rate 25Tk. telephone charge 35TK. And 15% vat on exchange rate. More then 25000TK every one 1000 exchange rate will be increase@1TK. Entry for TT: Particular Cash / Customer A/C SBC A/C Commission A/C Tele / Charge Dr. xxxxx xxxxx xxxxx xxxxx Cr.
Telegraphic Transfer, it may branch Telephonic or TELEX Transfer means fund/money transfer from one branch to another branch not in same area.Sometimes the remitter of the funds requires the money to be available to the payee immediately. In that case the banker is requested by him to remit the funds telegraphically.
39
3.3.4: Mail Transfer Advice (MTA):

Where the remitter desires the banker to remit the funds to the payee instead of purchasing a draft himself the banker does it through a Mail Transfer Advice. The payee must have an account with the paying office as the amount remitted in such a manner is meant for credit to the payees account and not for cash payment. The charges of MTA: Commission @ 10% but not less than TK. 1000/Mailing cost Cancellation of pay-order; a) On receipt of application along with pay-order for its cancellation, the signature of applicant is verified from the original application form. b) Before the pay-order is cancelled it is ascertained that no duplicate pay-order has been issued. The pay-order is cancelled and kept with the debit voucher. Cancellation of demand draft; a) Before the draft is cancelled it is ascertained that no duplicate draft has been issued. b) The draft is cancelled bearing out the signature thereon, and a note to this effect in red ink is made in the original application form and the Drafts Issued Register and initialed. c) The cancelled draft is attached with the debit voucher. d) No draft should be allowed to be cancelled without obtaining prior confirmation from the drawee branch. TK. 3000/- (Fixed)
3.4: Clearing section .

40
Out ward clearing:

All cheques, demand drafts and other credit instruments tendered for the credit of customers account will be delivered by the depositor at the clearing counter. Any deposits received by post will also be sent over to the clearing counter. The counter officer shall at the time of receipt examine such deposits carefully to ensure that: 1. The name of the account is very clearly written on the Deposit slips. 2. The particulars of deposits such as cheque numbers, names of bank etc. are properly entered on the deposit slip. 3. The depositor has signed the Deposit Slip.
Inward Clearing.
a) Local Office/Main Branch shall receive cheques etc drawn on Uttara Bank Limited branches from the Clearing House. On receipt of the cheque etc. they shall segregate the same branch-wise and issue IBDA on branches against total amount of cheque etc. and shall arrange delivery of the UBL together with the cheques etc. within Clearing House time schedule. b) Branches shall send the cheques dishonoured by them supported by UBL issued on Local Office/Main Branch, within Clearing House time schedule for enabling Local Office/ Main Branch to return these instruments in the 2nd Clearing House.
Transfer Delivery.
a) All such instruments drawn on easily accessible local Branches of UBL (say within Dhaka city) and deposited for credit of customer's account shall be treated as "Transfer Delivery". b) Uttara Bank Limited is yet to introduce transfer delivery system of collection amongst its branches in Dhaka. Till such time the branches shall continue to collect proceeds through outward bills for collection procedure as laid down in bills chapter.
Internal Transfer.
a) Transfer Book shall be maintained for entering transfer cheques/ vouchers.
41
The Overall Banking System of Uttara Bank b) Serial number shall be allotted both on the debit and credit side of the book, which shall be required for recording the daily transactions. The same serial number shall be noted on the voucher entered in the book including their contra credit and debit voucher and or a set of credit or debit vouchers of a transaction. c) Entries in the debit and credit column of the book shall be directly made from the respective debit and credit vouchers. At the end of the banking hours the total of the debit and credit shall be arrived at and tallied with the computer figure in Transfer Head. d) Transfer Stamp is affixed on the face of voucher; Vouchers are released from Transfer book. It is balanced and signed by the writer and Book is checked and signed by the authorized officer. e) In a computerized system scroll is done by the computer system. But branch shall maintain the Transfer Book manually as a safe guard against easy detection of mistakes and issuing vouchers if any.
3.5: Cash section Receipt of Cash.

Cash may be deposited either by deposit Slips for SB/ CD/ CC accounts or by other credit voucher like single credit voucher, pay order/ Draft/ T.T. application forms. Branches shall ensure the following: 1) Cash receiving officer shall check the deposit slip/ credit voucher/ application form as to its title of account, number and amount in words and figures. 2) The cash currency notes shall be counted physically /by cash counting machine as per denominations of the currency notes on the back of the voucher /deposit slip. The officer will enter the particulars in the cash Receiving Register and sign on the related deposit slip/voucher and affix "Cash Received" Stamp with date. 3) At the close of business the cash receiving officer shall add all the entries in the register and if agreed with the actual cash received by him, shall hand over the register for checking by officer-in-charge. 4) Receiving Cash officer will hand over the cash to the entire cash in-charge duly checked by him.
Payment of Cash.
42
The Overall Banking System of Uttara Bank Cheques, Cash Debit Vouchers, Fixed Deposit Receipts, Monthly Term Deposit Receipts, Bearer Certificates of Deposit, Demand Drafts, may be placed for payment at the counter by clients, beneficiaries and various departments for encashment. Branches shall ensure the following: 1) The instrument is checked for any apparent discrepancy and evidence of posting and cancellation. 2) Specimen Signature of cancellation officer shall be available with cash paying officer for convenience of payment. 3) On being satisfied, the cash paying officer shall count cash for payment and the denominations of notes are written on the reverse of the instrument invariably. 4) Signature of the bearer is obtained on the reverse of the instrument and compared with the signature already obtained from the bearer while presenting the instrument. 5) "Cash Paid" Stamp is affixed on the face of the instrument and signed by the cash paying officer. 6) Particulars of the instrument are entered in the cash payment register.
3.6: Dishonor of Cheques/ Instruments

Bankers are under legal obligation to honor customers cheque if funds permit. If they honor a cheque through oversight when there are no funds to the credit of the drawers account Bank may lose the money. On other hand, if they dishonor it through inadvertence they may pay damage for wrongful dishonors. Therefore, it is incumbent upon the bankers to proceed with caution in the matter of dishonoring cheque drawn on them. A banker is not under statutory obligation to give a written answer on a dishonored cheque. But as per practice, as well as agreement of Bankers Clearing House a banker should return it with Return Memo giving the appropriate reason for the dishonor. While giving such reasons, due care should be taken to see that the credit of the customer is not damaged by an unwarranted/ exaggerated answer. It should also be ensured that such reason does not mislead the payee. In the event of dishonoring a cheque it must be entered in the Cheque Returned Register and the authorized officer must sign in the register and the Cheque Return Memo.
43
The Overall Banking System of Uttara Bank The following reasons are generally used for returning cheques/ instruments: a) Effects not cleared, please present again. b) Not arranged for c) Payees endorsement required. d) Payees endorsement irregular. e) Payees endorsement illegible. f) Drawers signature differs from specimen recorded in the office. g) Endorsement requires banks confirmation. h) Alteration requires drawers signature in full. i) Cheque is post dated. j) Cheque is out of date. k) Exceeds arrangement. l) Amount in words and figures differ. m) Crossed cheque must be presented through bank. n) Payment stopped by the drawer. o) Full cover not received. p) Vernacular endorsement requires confirmation q) Instrument Mutilated/ Requires confirmation.
3.7: Deposit Section

The banks deposit stood Tk 50,817.0 million as on December, 2008 compared to Tk 43,586.4 million in 2007, thus recording 16.59 percent growth. Competitive interest rates, attractive deposit products, deposit mobilization efforts of the Bank and confidence reposed by the customers in the Bank contributed to the notable growth in deposit. The Bank evolved a number of attractive Deposit Schemes to cater to the requirement of small and medium savers. These helped to improved not only the quantum of deposits but also to bring about qualitative changes in deposit structure.
44
Types of Deposit Accounts:

The branches may accept deposits from the public in the following accounts: a. b. c. d. e. f. Current Deposits Savings Bank Deposits Fixed Deposits (Term Deposit) Short Term Deposits Monthly Term Deposits Any other deposits as may be approved/ advised by Head Office.
Current Deposit Account.

a) Minimum balance to be maintained in the account is Tk.2,000/b) Customer willing to open Current Deposit Account shall fill up the Account Opening Form (AOF) applicable to him/ her and Specimen Signature Card (SS Card). The customer will sign in the space provided under Yours faithfully and on the specimen signature cards. c) In case of proprietorship and partnership firms the relevant account opening form is to be filled in and signed by the proprietor/ partner in their individual capacity in the space provided under Yours faithfully and on the specimen signature card in their official capacity. d) In all other cases including companies etc. the persons opening the account shall fill in the relevant Account Opening Form and sign the Form in the space provided under Yours faithfully and in the specimen Signature Card in their official capacity. e) Introduction of acceptable clients to be obtained as per guidelines. f) The Managers approval for opening account shall be obtained by the concerned staff member. g) A Current Deposit Account may be opened by individual, firm, company, and club, association, body corporate etc.
45
Savings Bank Deposit Account.

1) Savings Bank Account may be opened in the name of adult individual who are mentally sound and also jointly in the names of two or more persons payable to either or both or all of them or to the survivor or survivors. 2) Savings Bank Account may be opened in the name of a minor also. 3) Saving Bank Account may be opened in the names of clubs, societies, association and similar institutions and even by government and semi-government offices. 4) Account shall be opened with at-least a minimum initial deposit of Tk.1, 000/-.
5) Interest at the rates fixed by Head Office from time to time is applied half-yearly on the balances held on daily product basis. 6) Not more that one account be allowed to be opened in the same name. But this will not be applicable to parents willing to open more than one account in his/ her name in respect of each minor child. 7) Savings Bank Account shall not be allowed to be overdrawn under any circumstances. 8) Account opening formalities like Current Account should be followed. 9) Savings Bank Account should not be allowed to be operated like Current Account 10) Not more than 25% of the balance can be withdrawn without 7 days notice. Withdrawals in the account shall be allowed twice in a week.
Short Term Deposit Account (STD).

Deposits held in this account are payable on short notice. Normally corporate bodies, bank and financial organizations invest their funds temporarily. Now-a-days, private individuals having sound financial means also open this type of deposit accounts. The following rules shall apply: 1) Deposits held in STD Account are payable in 7 (Seven) days notice. 2) Cheque books may be issued to account holders for withdrawal of funds. 3) Repeated withdrawal without notice shall be discouraged. 4) Interest is payable on balance held on daily product basis as per computer program used by bank. 5) For opening STD Account, AOF used for Current Deposit Account shall be used. 6) Other formalities are similar to Current Deposit Accounts. 46
Fixed Deposit Account.

1. Fixed Deposit is neither transferable nor negotiable. 2. Fixed Deposit Account may be opened by individuals, firms, companies, corporate body etc. 3. Fixed Deposit Account shall be opened for a fixed period ranging from 3 months to 36 months or above as determined by Head Office from time to time. 4. Rate of interest payable to Fixed Deposit Accounts shall be approved/ advised by Head Office from time to time. 5. Interest on deposits shall normally be payable on maturity along with principal. 6. Customers may however, have the option of withdrawing interest accrued after every six months provided that the account is for more than 24 months period. 7. FDR may be encased before maturity on written request of the depositor. For payment of interest, branch shall follow Head Office instruction in this regard from time to time. 8. In case of FDR in joint names, written consent of all holders shall be obtained before premature encashment, irrespective of instruction provided for operation of the account.
Monthly Term Deposit Account.

In order to extend better opportunity for investment of funds for short period to the existing and potential clients, Uttara Bank Limited has introduced this deposit scheme. The salient features of the scheme are as follows: 1) A minimum deposit of Tk.50, 000/- and its multiple shall be accepted by branch for one month. 2) All other formalities similar to Fixed Deposit Account shall be followed. 3) In case of premature encashment within 15 days of issue, no interest shall be paid. 4) In case of premature encashment i.e. after 15 days of issue but before maturity, interest at the STD rate shall be paid. 5) MTD will be renewed automatically if no instruction otherwise is received by the branch. 6) Credit facility may be allowed against MTDR. 7) Interest on MTD shall be fixed by Head Office from time to time.
47
3.8: Closing of Accounts

For different reasons, the account holder(s) may request for closure of his/ their account with the bank. On receipt of such letter of request for closure of account, the Manager should ascertain the reasons to satisfy himself that the constituent is not severing his relations for grievance from the bank which may possibly be redressed. If for genuine reason the account holder(s) approach for closure of his/their account, the following steps shall be taken: a) The application shall be received together with unused cheque leaves. b) The signature of the account holder shall be verified c) The number of unutilized cheque leaves shall be noted on the letter. d) The Manager shall approve closure of the account and ascertain liability position (if any) and closing charges at prescribed rate to be recovered. e) The account holder may be requested to withdraw the balance on deduction of the charges. Other wise the balance payable may be paid by way of pay Slip / Pay Order in favour of the account holder f) After closure of the account, "Account Closed" Stamp shall be affixed on the account opening form, S.S. Card and in the Account Opened and Closed Register with date under signature of an authorized officer. g) The Account opening form together with S.S.Card and the request letter shall be retained in Account closed file to be maintained in branches for Current and Savings Accounts separately. h) If the balance is paid by way of Pay Slip/Pay order, the debit advice may be delivered to the account holder either by hand or by mail. i) The unused cheque leaves shall be destroyed by authorized officer and shall be recorded on the application for reference under joint signature. j) The unused cheque leaves shall be entered in the A/C Opening Register and the running number of the account shall be drawn reducing the closed account on each day.
48
3.9: Account Section Individual Account.

Most of the accounts of a branch are individual. As such they deserve regular attention of the members of the staff of a branch. An individual account holder may nominate his near and dear ones to inherit his deposit in case of his death. He/ she can also give mandate or authority to operate his account in his short absence.
Joint Accounts.
1) At the time of opening accounts in the name of two or more persons, clear and specific instructions shall be obtained regarding operation of the account and payment of balance to the survivor(s) or surviving members in the event of death of one or more joint account holders. 2) The instructions as far as possible shall be obtained in the hand writing of the parties concerned, under the signatures of all the joint account holders. 3) If the account is opened in the name of two persons instruction may be: Either or Survivor or singly or jointly. 4) If the account is in the names of more then two persons instructions may be: By either or Survivor singly or by any two or more of them or by all of them. 5) Incase of death of any joint account holders, if the specific instructions are either a or b, the balance will be payable to the survivor(s). 6) In the absence of specific instructions in the Either or Survivorship form, balance of the joint account will be payable to the survivors and the legal representatives of the deceased joint account holders. 7) Account payee cheque in the name of one of the account holders may be deposited in their joint name account for collection. 8) In the event of any of the Joint Account holders becoming bankrupts, all operation in the joint account shall be stopped until fresh instructions are given by the remaining solvent account holders jointly under their signature and the official assignee. 9) In the event of death of any joint account holders, the survivor or survivors shall be requested to close the old account and open a new account in the name of surviving account holders.
49
Account of Proprietorship Concern.

1. While opening accounts in the names of proprietorship concern care should be exercised that the person opening account is the proprietor of the firm. Obtaining trade license issued by Municipal Authority/ Union Parishad can be a proof. On specific instruction the account may be operated by persons authorized by the proprietor. 2. In case of death of proprietor, all operations in the account shall be stopped. Procedure laid down in Para (r) may be followed. On the death of the proprietor authority given by him ceases and the authority holder can not be allowed to operate the account.
Accounts of Partnership Firm.

1. A partnership account shall be allowed to be opened and operated by any one partner of the firm under his signature provided a partnership letter has been signed by all the partners of the firm in their individual capacity. 2. Partnership Deed or Partnership Letter should be thoroughly studied to know the names and address of all the partners. 3. In case of death of partner, if the deceased partner was operating the account singly, the balance shall be paid to the heirs of the deceased and the surviving partners as per orders of the Court agreement or arrived at between the surviving partners and heirs of the deceased. In the later case, the recipient shall execute indemnity bond as explained in Para regarding deceased account. 4. If a partnership Deed is submitted the same should be accepted and recorded with the bank. 5. In case of death of a partner who was not operating the account the surviving partners shall be advised to close the partnership account and open a new account. 6. An operating partner may give mandate to a third person to operate the account in place of him.
50
Accounts of Joint Stock Companies.

1. A Joint Stock Company is a separate legal entity. The shareholders may die or become insolvent. The company shall continue to exist unless the number of share holders falls below the minimum number of members. 2. The minimum number of members is two and maximum is 50 excluding employees and ex employees. Private Limited Company cannot invite public to subscribe to its shares and therefore, not required to issue a prospect us. Right to transfer share is restricted. It can commence business as soon as it receives certificate of incorporation. It need not obtain Certificate of Commencement of Business. 3. No cheque book shall be issued or withdrawals allowed from the account of the newly floated companies unless a certified copy of commencement of business is produced by the company. 4. If the company fails to produce such certificate as mentioned at Para (v), the deposits accepted by the bank on their behalf representing share money, received in anticipation of the commencement of business, shall be refunded in lump sum to the Directors of the company obtaining a joint receipt from all of them subject to prior approval of Head Office. 55 5. Account of Limited Companies operated by the Managing Agents of the company shall not be opened or allowed to be operated unless a certified copy of the Managing Agents, Agreement is obtained and the authority of the persons signing on behalf of the firm or company or the Managing Agent is verified.
Death of Constituent/ Deceased Account.

While releasing the balance in the deceased account the following procedure and precaution shall be observed. The Branch Manager should at first be satisfied about the benefited of the beneficiary/ Legal heirs of the deceased and obtain the following papers/ documents. Notice on knowledge of death, insolvency or insanity of a constituent precludes the bank from paying further cheques on his account even though these are dated prior to his death. If the information is authentic, the same should be noted in the record of banks and payment on the account be stopped. In case of any doubt, immediate inquiries are made to ascertain the correct position. 51
The Overall Banking System of Uttara Bank 1. Application of the legal heirs of the deceased. 2. Succession Certificate 3. Death Certificate 4. Union Council / Pourashava Chairman/ Ward Commissioner Certificate. 5. Certificate as to the balance of the deceased account (given by the branch). 6. Liability position of the deceased if any duly certified jointly by two attorneys. 7. Letter of authority or Power of Attorney is to be obtained in case the amount of one heir is to be with drawn by another heir. 8. Legal Guardian or an Executor appointed by them may withdraw the money of a minor legal heir without guardianship Certificate. 9. Where the balance in the deceased account is up to Tk.25, 000/- the same may be released without succession certificate, but other formalities to be observed.
Handling of Dormant Accounts Dormant Accounts: Current or Savings Bank Account, if remains inoperative for a
certain period, will be treated as Dormant Account. In case of Current Account the period is 12 months while in case of Savings Bank Account the period is 24 months. The dormant accounts should be identified annually during the month of January by applying computer programmed which marks each dormant account with remark Dormant against the account in the daily/ monthly periodical print out. In case computer facility is not available, dormant ledger is to be maintained. The following procedures and precautions shall be taken to avoid fraudulent withdrawals/ transfer of funds from such accounts. 1. All individual Current Account and Savings Bank Accounts shall be classified as Dormant if it falls within the criterion as mentioned in the foregoing paragraph. 2. The account of Proprietorship and Partnership concerns, Joint Stock Companies, Local Authorities, Semi Government and Government Institutions shall not be treated as Dormant Account even if no withdrawal/ deposits take place for such period. Rather efforts should be made to revive those accounts so that they remain regular accounts.
52
The Overall Banking System of Uttara Bank 3. The Branch Manager shall scrutinize and ensure genuineness of the instruction/ advice before authenticating action in the Dormant Account on the following:
Transfer of fund to any account of the branch. Transfer of Dormant Account to another branch Transfer of fund from Dormant Account to another branch/ bank. Closure of account. Change of Address. Issuance of fresh Cheque Book. Unclaimed Accounts:
I. Current and Savings Bank Accounts dormant/ inoperative for 5 years may be treated as unclaimed accounts. II. Overdue Fixed Deposits, Demand Draft Payable, T.T. Payable, Sundry Deposits, Pay Order outstanding for 3 (three) years and above may be treated as unclaimed accounts. III. All these accounts be listed out and retained in file for reference. IV. No interest shall be applied to Savings/ Fixed Deposit Account if treated unclaimed. V. However, Branch shall follow Bangladesh Bank and Head Office circulars on the above from time to time.
Inter Branch Transfer of Account:

In case of transfer of Savings or Current account to another branch, a letter of request should be obtained and action be taken after verification of the signature and taking proper approval of the Manager. The request of the account holder desiring the transfer of the account shall be taken an application. I. When the application is received Manager of the branch will check up the same and if found in order will approve transfer of the account. The relative specimen signature cards and account opening form shall then be taken out from file for transfer by the concerned department. II. The following entries shall be passed by the branch transferring the account. III. Debit IV. Credit : : Partys account. UBL General Account (Transferee branch).
V. The transferring branch should not recover any charges from the account holder for transfer of the account. 53
The Overall Banking System of Uttara Bank VI. The forwarding letter as per the following specimen shall be singed by the Manager. VII. At the time of transferring the account the branch may retain photocopy of AOF and SS Card together the application and preserve in Account transfer file. VIII. Entries shall be made in the Account opened and Closed Register and a note to this effect Account Transferred to .. Branch on. shall be made therein. IX. Measures to be taken by the Transferred Branch.
Issuance of Cheque Books:

General Service Division of Head Office will supply required Cheque Books to branches against their requisition from time to time. On receipt of these cheque books/ other security stationery, the branch shall record the stock in the Security Stationery Stock Register. While recording the stock, the Prefix number shall invariably be mentioned. a) Separate folios will be opened in the Cheque Book issue Register for CD/ SB/ STD account cheque books. b) The requisition slip shall be sent to the respective Computer Terminal for posting in the respective account. c) All subsequent Cheque Books shall be issued against Cheque Requisition Slips extracted from the previous cheque books issued to the customer; however, the requisition slip pasted with subsequent cheque book on its first page shall be destroyed. d) The cheque requisition slip duly filled in by the customer shall be forwarded to cheque posting Terminal to ascertain:
The average balance maintained by the customer. Whether previous cheque leaves are properly consumed. Cheques are not frequently returned for insufficient funds in the account. Payment of Cheque is not frequently stopped. The manner in which the account is operated. The account is not dormant. Balance Inquiries & Statements:
54
Balance Inquiries.
I. The account holder may enquire about his/her balance in the account. The client may be advised to fill and sign the Balance Requisition Slip (BRS) or to produce the Letter of Authority (LOA) duly signed by the account holder. II. The signature of the account holder shall be verified on the BRS or LOA before disclosing the balance. III. If a slip is required to be sent by mail or hand, it shall be sent in a closed envelope addressed to the account holder.
Balance Certificate.
In the event of a balance certificate required by an account holder, he/she may be provided with such certificate as per computer print report recorded by the branch against his/her written request. Certificate may be delivered as per instruction of the account holder.
Balance Confirmation.
I. In a computerized system of accounts, the computer program will provide print report of balance confirmation of Accounts along with a sub-joined part. It will contain the full address of the account holder. The balance confirmation shall be dispatched to account holder in a window envelope. Follow-up should be made to get back the sub-joined part duly signed by the account holder. II. On receipt of the confirmation from the party regarding his/her balance duly signed, it shall be preserved in a file after verification of signature. III. Balance confirmation for debit balances in case of over-draft, cash Credit and/or loan accounts shall be dealt with separately. The sub-joined part to be received from clients duly signed by them and preserved in their document file after verification of signature.
3.10: Credit and Risk Management (CRM)

55
The Overall Banking System of Uttara Bank Credit risk is the possibility of failure f a bank borrower or counterparty to meet its obligations in accordance agreed terms. The major causes of serious banking problems continue to be directly related to lack of credit standards for borrowers and counterparties, poor portfolio risk management, or a lack of attention to change in economic or other attention to change in economic or other circumstances that can lead to deterioration in the credit standing of a banks counterparties. The goal of credit risk management is to maximize a banks risk- --adjusted rate of return by maintaining credit risk exposure within acceptable levels. The effective management of credit risk is a critical component of a comprehensive approach to risk management and essential to the long term success of any banking organization. The Basel Committee is encouraging bank to promote sound practices focus on the flowing aspects:
Establishing an appropriate credit risk monitoring environment. Operating under a sound credit- granting process. Maintaining an appropriate credit administration, measurement and monitoring process, and Ensuring adequate controls over credit risk.
Uttara Bank Limited is keenly aware of the need to identify measure, monitor and control credit risk as well as to hold adequate capital against these risks for adequate compensation of risks incurred since exposure to credit risk continues to be the leading sources of problems in banks world - wide. In this respect, following the system as per Guidelines of Bangladesh Bank. The Bank has also adopted a policy to the whole system from time to time to copy with the multifarious of credit risk.
Credit recovery and legal division is engaged in vigilant monitoring of the total credit classification of the bank, managing all classified and special Mention Accounts to regularize for maximization of recovery and ensuring appropriate loan loss provision timely. By dint of special attention, Bank could reduce the percentage of classified portfolio from 5.06% to 2.84% in 2009through substantial amount of loan recovery and regularization. 56
3.10.1: Loans and Advances

Loan and advance is the largest items of Bank assets. This is almost 68.67% of the total value of banks asset. A banks loan account typically is broken down into several groups of similar types of loans. In 2009prime bank ltd. has a total amount of Tk. 21,036.86 million loan.
Loan and Advance
68.67%
The graph shows 68.67% Total loans and Advances
UBL was in constant efforts to explore different areas of credit operation and could raise the credit portfolios to Tk. 2106.86 million in 2009with an increase of Tk. 4419.41 million (26.59%) over that of the preceding year. The total credit was on 31.12.07 was Tk. 16617.45 million. From the year previous the amount of loans and advances is increasing respectively. Here it is shown by a graph.
Taka in million
Year 2006 Loan and Advance 6,723 Year 2007 11,012 Year 2008 12,797 Year 2009 16,617 Year 2010 21,037
57

Loan and Advance
30,000 20,000 Taka in million 10,000 0
200 4 Loan and Advance 10,531
200 5 12,240
200 6 28,797 Year
200 7 20,917
200 8 21,037
The graph shows Total loans and Advances of last five years
58
Loan Administration and Monitoring.

1 For this purpose, UBL have in place, a full fledged Division at Head Office, where all the credit functions are constantly supervised and closely monitored, not only to keep the existing portfolio in sound footing but also for recovery/ regularization of overdue/ classified loans and advance. 2 The executive committee of the board, in order to ensure perfection of credit documentation has instructed the management to get all the mortgage documentation counter vetted and checked by a second legal adviser enlisted with the bank other than the lawyer who vetted it originally. Finally, to help smooth functioning of the audit committee of the board, the board of directors have decided to appoint a reputed chartered accountancy firm in addition to the existing external auditors to conduct special audit and report on quarterly basis in order to monitor and supervise the internal operations of the bank more frequently. This is expected to bring absolute transparency and accountability, as well as strengthening banks internal control procedure.
End Result.
We believe our risk management system is functioning quite effectively, which is amply illustrated from the fact that the position of classified loans has reduced to 0.36% in the year 2003 from 0.60% in 2002.however, your board of directors would like to assure the future also to upgrade and strengthen the risk management and control methodology of the bank
59
Chapter Four
Analysis & FindingsS
60
4.1: Analyses
Analyses is a short form for the internal strength and weakness of a firm and the environmental Opportunity and Threat facing that firm. So if we consider Uttara Bank ltd. as a business firm and analyze its strength, weakness, opportunity and threat the scenario will be as follows:
SWOT Analysis of UBL: Opportunity Threats
Consumer credit scheme can be very The following chart is the reflection of most profitable and prospective sector for the aggressive threat for UBL: bank. Name of the banksAmount of defaulting
Some positive movements against the loan% of unrealized loan defaulters by the Governments. National Bank-543 crore 65 lac-39.37%
Overall increase of bank deposit in a Uttara Bank-399 crore 57 lac-39.25% prospective manner. Rupali Bank-720 crore 44 lac-37.46% IFIC-475 crore 32 lac-35.44% Janata Bank-1304 crore 2lac-29.99% Standard Chartered Bank-28 crore 16 lac4.95%.
Strengths:
*Professional, well experienced and efficient employee are working with sincerity and best effort. *Well planned job rotation program for management trainee and probationary officer. *Income parable integrity in terms of maintaining privacy of any client account.
Weakness:
*Commission and other service charges are unnecessary low comparing to those of the other banks. *Workload on the employees are too heavy for them to provide proper answer to clients question which sometimes
develops client dissatisfaction.
61
4.2: Findings
Uttara Bank Limited is one of the leading private banks in the country. The findings of the report are-
U The Bank has remained dynamic in its continued efforts to improve & increase
core competence & service efficiency by constantly upgrading product quality, service standards.
U The customers are very much satisfied about the service of the worker of the
bank.
U The bank established correspondent relationship across the world. More than 110
countries have been covered through 100 world-class correspondent banks by which the can gave the best service to the customer.
U Different types of account holders are the main assets of the bank; most of the
account holders are the savings and term deposit holders.
U The bank bears a large number of shortages of human resource; as a result they
cannot give proper support to the customer as fast as the multinational bank in the country as a joint venture bank.
U Information Technology department is the most efficient department compare to

other department.
U UBL took part in foreign transaction as one of the most leading bank. U Uttara Bank Limited offers international debit card by which the can access from
any part of the world.
U The bank use online technology, as a result, the customer can get the fastest
service from the bank.
U The bank offer commissions free service of TT, PO, and DD for the account
holders.
U The bank gives more interest on FDR and MD; as a result many people who have
ideal money can in invest this risk free investment.
U By analyzing the financial statement I found that the ROE & ROA is increasing
day by day, that shows a positive indicator to the economy.
U Finally Uttara Bank Limited can be called one of the best bank for the time
being.
62
Chapter Five
Recommendations & Concluding
5.1 Recommendations:
63
The Overall Banking System of Uttara Bank Though Uttara Bank Limited tries to give the best customer support, the have some lake and linkage compare to other bank of the same generation. The recommendations for this report are:
U The authority should recruit more employees to serve the customers. The can
recruit experienced employee as well as fresh graduate.
U The bank should introduce more products based on the market demand. U The bank should reduce their minimum balance to attract more customers. U The salary of the worker need to be rise, as a result experienced people from
other bank will be attract to join Uttara Bank Limited Limited.
U The bank can open more branches to reach to more customers. U The bank can open branches or foreign booth because many people send money
from abroad every year to Bangladesh.
U The bank should finance to the consumer goods, because many people in the
country wants to buy consumer goods from bank loan.
U The marketing department of the bank should more efficient to reach at the hart
of the customer.
U For the success of any organization, employee satisfaction is one of he most

important factor and DBBL authority have to look about it.
U The bank should be more profit concern as well as took part to the economics
development of the country.
U The departments of the bank should more efficient to make profit by satisfying
customers.
U The bank should use printed instruments like cheque, pay orders etc. U Being a clear transparent the bank can provide the best support to the customer as
earn profit.
5.2 : Conclusion
64
The Overall Banking System of Uttara Bank Uttara Bank Limited is bank of new generation. Though I tried to include at my report about deposit, customer service and general banking, I followed their rules and regulation and tried to use them in my report to prepare this report with my best effort. Though all departments and sections are covered in the internship program, it is not possible to go to depth of each activities of branch because of time limitation. Bank is an institution, which acts as a financial intermediary. Since bank collect deposit from various source by paying interest to them and grant loan to some other parties at high rate to interest then the interest paid to the depositor, the differences between the two interests is termed as the profit.
Since Uttara Bank Ltd. Credit limit increased by taka 9907 core or 18.10% to tk. 64553.10 core during 2009-2010ompared to increase of 10.30% in the preceding year, Uttara bank Ltd. Should pay more attention to loan and advance which not only increase its profit position but also alleviate poverty level of Bangladesh by providing loan to the capital seeker, increase standards of living.
65
Chapter Six
Bibliography
66
Bibliography
1. General Banking Manual- Uttara Bank Ltd. 2. Annual Report-2007-2009 3. Web site: http://www.uttarabank.com 4. www.dhakastockeexchange.com 5. Daily Ittefaq 6. BIBM text book by Toufic Ahmed Chowdhury 7. Economic Trends published by Bangladesh Bank. 8. Brochures of Uttara Bank Limited (UBL). 9. Principles of Islamic Banking. 10. Competitive advantages of Banking and Finance. 11. Marketing Management by Bangladesh Bank.
67

Uttara Bank

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Uttara Bank

Uploaded by

Copyright:

Available Formats

The Overall Banking System of Uttara Bank

The Overall Banking System of Uttara Bank

Yours Sincerely, ---------------------------

The Overall Banking System of Uttara Bank

He is permitted to submit the Internship Report.

The Overall Banking System of Uttara Bank

The Overall Banking System of Uttara Bank

The Overall Banking System of Uttara Bank

The Overall Banking System of Uttara Bank

Table of Contents Chapter

Statement) General banking Account opening section

5 .1 (Concluding Chapter) Chapter 5 .2

The Overall Banking System of Uttara Bank

Orientation of the Report

The Overall Banking System of Uttara Bank

The Overall Banking System of Uttara Bank

1.1:Background of the Study

1.2: Rationale of the Study

The Overall Banking System of Uttara Bank

1.3: Objective of the Report. Primary objective:

1.4: Scope of Report.

The Overall Banking System of Uttara Bank

1.5: Limitation of the Report.

Data Analysis Method.

The Overall Banking System of Uttara Bank

Background of the organization

The Overall Banking System of Uttara Bank

2.2: Vision/Mission, Strategies Statement

2.3Composition of the Board

The Overall Banking System of Uttara Bank

Mr. Azharul Islam

The Overall Banking System of Uttara Bank

Mr. Shamsuddin Ahmed

Chairman Vice Chairman Directors

Mr. Shamsuddin Ahmed

Managing Directors since 1965

2.5 Management Structure: ORGANIZATION HIERARCHY OF UTTARA BANK LTD

The Overall Banking System of Uttara Bank

2.6 Key figures

Test Key Department

Marketing Division Business Development Department Branches Department

Engineering Department Public Relations Department

Credit Risk Management Divisio n

Credit Approval Department

Credit Admin & Monitoring Department

Credit Marketing Depa rtment

Credit Recovery Department

The Overall Banking System of Uttara Bank

Central Accounts Division Accounts Department Reconciliation Department

Internal Control & Compliance Division

Audit & Inspection Department

Central Accounts Division

The Overall Banking System of Uttara Bank

Internal Control & Compliance Division

Audit & Inspection Department

International Division Treasury Division

Sylhet Zone Khulna Zone

The Overall Banking System of Uttara Bank

2.7 BALANC SHEET

The Overall Banking System of Uttara Bank

PROPERTY AND ASSETS Cash

5,860,103,625 1,585,554,764 4,274,548,861

Balance with other Banks and financial institutions