An Internship Report On

An Internship Report on
Banking Practice in Bangladesh: A NCC Bank View
NCC BANK LIMITED

WHERE CREDIT & COMMERCE INTEGRATES
Submitted to:
Submitted by:
Tuha Hamid Ima
ID-
BBA Program, Leading University, Sylhet
SUBMITTING DATE:
LETTER OF SUBMISSION
1
1.1.2014
Jahangir Alam
Associate Professor
BBA Program, Leading University
Subject: Submission of Internship Report.
Sir/Madam, It is my great honor to submit the report of my Internship Program at NCC Bank
(National Credit & Commerce Bank) Ltd., Bondorbazar Branch. In addition, it is a great pleasure
that I have been able to submit the internship report on Commercial Banking Practices in
Bangladesh: A NCC Bank View in due time.
The whole experience of this internship program enabled me to get an insight into the real life
situation. I have tried my best with my knowledge to make a full-fledge report by analyzing all
the requirements you have asked for. Besides this, there may be shortcomings. I would be
grateful if you consider those from excusable manner.
I would like to express my sincere gratitude to you to assign me such present time oriented topic.
I will be happy to provide any further explanation regarding this research report if necessary.
Tuha Hamid Ima
ID-
BBA Program, Leading University, Sylhet
ACKNOWLEDGEMENT
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First of all, I extend my profound gratitude to the Almighty Allah, the omnipresent and
omnipotent, who helped me accomplish this task on time. I feel satisfied and glad that I have
completed this study within specific duration.
This internship report might never have been completed without the necessary practical
knowledge, assistance of many books, articles, websites, and primary data. It enhanced my
knowledge on employee job satisfaction. Thanks to all those persons, who have assisted me,
providing me co-operation, books and articles, I would like to express my special gratitude to my
supervisor Mr. Jahangir Alam, Lecturer of Leading University Sylhet, for his motivating
inspiration, kind direction, valuable suggestions & advices during my internship period and to
prepare this report.
I was placed in NCC Bank Limited to work as an intern from 16 th September 2013 to 16th
December 2013. The members and management of NCCBL Bondorbazar Branch was very co-
operative and helpful. They helped me through providing various data, guidance and direction. I
am grateful to Mahmudur Rahman, Manager of NCCBL Bandorbazar Branch for his cooperation
and necessary support.
Finally I want to express my special thanks to Sumanta Gupta, Jr Officer, NCCBL, Bondorbazar
branch, under whom I have completed my three months internship program. I am also grateful to
all other employees of all division of this branch.
EXECUTIVE SUMMARY
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This study is the result of my internship program ran for the past three months placed at the NCC
Bank Ltd. Bandorbazar Branch, Sylhet. National Credit and Commerce Bank Limited is one of
the second generation banks. It has already developed reputation among the users. The bank
operates its all products as the Bandorbazar Branch is middle of the city which is a uprising
commercial area as well as residential area. As a result the branch has to deal with commercial
and non-commercial clients. Therefore, the branch has all level of employees of the bank.
Since my internship program was directed to understand banking practices of the bank, I had to
gain the practical area of responsibilities and of accountabilities of the employee so that I could
interact with them to assess their views and activites about and relations with the organization. I
tried best to ask the staffs directly and indirectly to gather my information. However, I had a
good access to the banks publications. My task was designed to understand the general, credit
and foreign exchange banking practices of the NCC Bank Ltd. Bandorbazar Branch. For
preparing this report I used primary and secondary data. The objectives of the report were
clarifying the operations of the NCC Bank Ltd, Bandorbazar Branch. So, the research was
designed to achieve it. The previous studies on this issue practically and empirically learnt the
banking operation largely depends on what a bank does to run its business and what the job
specifically. Despite differences in work of every individuals the common goals are the very
same and the individuals performs it that way.
TABLE OF CONTENT
ABOUT THE REPORT

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CHAPTER CONTENT PAGE NO
1
1.1 Objective of the Report 1
1.2 Methodology of the Report 1
1.3 Limitations of the Report 2
1.4 Scope of the Study 2
INTRODUCTION
CHAPTER 2 CONTENT PAGE NO

2.1 Introduction 3
2.2 Current Banking Scenario in Bangladesh 3
OVERVIEW OF NCCBL

3.1 Background of NCC Bank 5
3.2 Mission 5
3.3 Vision 5
3.4 Positioning Statement 5
3.5 Value 5
3.6 6
Training
3.7 7
Human Resource Management
3.8 7
Management Information System (MIS)
3.9 Board of Directors 7
3.10 Structure of the Bandorbazar Branch 8
3.11 Ownership Pattern 9
3.12 Branch Network 10
1.13 Nature of Business 10
1.14 Competitive Conditions in the Business 10
BANKING PRACTICES OF NCC BL (GENERAL BANKING)

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4.1 Account Opening Section 11
4.2 Local Remittance Section 16
4.3 Foreign Remittance Section 18
4.4 Clearing and Collection Section 21
4.5 Cash Section 22
4.6 Accounts Section 23
BANKING PRACTICES OF NCC BL (CREDIT)

5.1 Classification of Loans and Advances 24
5.2 NCC Banks Special Credit 26
5.3 Modes of Credit 27
5.4 Types of Credit in Foreign Trade 28
5.5 Lending Authority 28
5.6 Sanction of Credit 29
BANKING PRACTICES OF NCCBL (FOREIGN EXCHANGE)

6.1 Foreign Exchange 30
6.2 Letters Of Credit / Documentary Credit (L/Cs) 30
6.3 Banks Operated In Documentary Credit 30
6.4 Import Section 31
6.5 Export Section 35
6.6 Collection Section 38
FINANCIAL PERFORMANCE OF NCCBL

7.1 Financial Performance of NCCBL 40
7.2 Authorized Capital, Paid up capital, reserve fund & other 40
Reserves
7.3 Deposits 41
7.4 Investment 41
7.5 Foreign Exchange Business 42
7.6 Remittance Business 43
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SWOT ANALYSIS OF NCCBL

8.1 Strengths 45
8.2 Weaknesses 46
8.3 Opportunities 46
8.4 Threats 47
FINDINGS & RECOMMENDATION

9.1 Findings 48
9.2 Recommendation 49
CONCLUSION

10 Conclusion 50
BIBLIOGRAPHY
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CHAPTER 1:
1.1 Objective of the Report

Though the main objective is to prepare myself in such a manner as though I can equip
myself with the practical field as well as I will be able to know the different aspect of the
banking sector and to evaluate how a bank is performing in Loans and Advance sector. In
addition, the study seeks to achieve the following objectives:
Broad Objective:
To learn and analyze overall banking practices of NCC Bank Limited
Specific Objective:
To analysis the pros and cons of the conventional ideas about whole banking operation of
a NCC Bank.
To have better orientation on credit management activities specially credit policy and
practices, credit appraisal, credit-processing steps, credit management, financing in
various sector and recovery, loan classification method and practices of NCC Bank
Limited (NCCBL).
To identify and suggest scopes of improvement in credit management of NCCBL.
To get an overall idea about the performance of NCC Bank Ltd.
To know the organizational framework of the bank

To know the work environment and organizational behaviors of the bank

To get through all the departments of the bank and observe the actual work done
To fulfill the requirement of the internship program under BBA program.
1.2 Methodology of the Report

Primary Source of Data:
Both primary and secondary data sources will be used to generate this report. Primary data
sources are informal discussion with professionals and observation while working in different
desks. The secondary data sources are annual reports, manuals, and brochures of NCC Bank
limited. To identify the implementation, supervision, monitoring and repayment practice-
interview with the employee and extensive study of the existing file was and practical case
observations were done.
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Primary Sources are:
1. Discussion with officials of different departments of NCC Bank, Bandorbazar Branch.
2. Observation while working in different desks
3. Informal discussion with professionals
Secondary Sources of data

The secondary data will be collected from the MIS of NCC Bank. To clarity different conceptual
matter, interest and different articles published in the journals and magazines will be used.
Secondary Sources are:
1. Annual Report of NCC Bank
2. Other published documents of Bangladesh Bank.
3. Published specifications of different products in websites.
1.3 Limitations of the Report

Though I have given utmost effort to prepare this paper but there are some limitations of the
study. They are as follows-
1. Time constraints
2. Limited access to data
3. All the employees of the bank are very busy. So they do not have much time to share
information.
4. This paper has focused on the general practices of the bank and their performance. So the
bank authority hesitated to disclose important inner information to maintain business
secrecy.
5. The employees of the branch were so much helpful though they had a little scope to
describe us every mechanism in a detailed way.
6. Only 3 months time is not enough to complete such a study in a lucid manner.
1.4 Scope of the Study

Since, working at NCC Bank Ltd. Bandorbazar Branch, get the opportunity to gain knowledge of
the components that helps to retain banking practices. The decisions and analyses are done based
on the observation of the daily activities applied at only this branch.
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CHAPTER 2:
2.1 I
A bank is a financial institution and a financial intermediary that accepts deposits and channels
those deposits into lending activities, either directly or through capital markets. A bank connects
customers that have capital deficits to customers with capital surpluses. Banks act as payment
agents by conducting checking or current accounts for customers, paying checks drawn by
customers on the bank, and collecting checks deposited to customers' current accounts. Banks
borrow money by accepting funds deposited on current accounts, by accepting term deposits, and
by issuing debt securities such as banknotes and bonds. Banks lend money by making advances
to customers on current accounts, by making installment loans, and by investing in marketable
debt securities and other forms of money lending. National Credit and Commerce Bank Ltd.
bears a unique history of its own. The organization started its journey in the financial sector of
the country as an investment company back in 1985. The aim of the company was to mobilize
resources from within and invest them in such way so as to develop country's Industrial and
Trade Sector and playing a catalyst role in the formation of capital market as well. Its
membership with the browse helped the company to a great extent in these regard. The company
operated up to 1992 with 16 branches and thereafter with the permission of the Central Bank
converted into a fully fledged private commercial Bank in 1993 with paid up capital of Tk. 39.00
crore to serve the nation from a broader platform. Since its inception NCC Bank Ltd. has
acquired commendable reputation by providing sincere personalized service to its customers in a
technology based environment. The Bank has set up a new standard in financing in the Industrial,
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Trade and Foreign exchange business. Its various deposit & credit products have also attracted
the clients-both corporate and individuals who feel comfort in doing business with the Bank.
2.2 Current Banking Scenario in Bangladesh
When Bangladesh came into existence on the 16th December, 1971, the banking sector of
Bangladesh was in total disarray. With the exception of two local banks incorporated in the East
Pakistan, all the bigger local banks became in operational. Starting with such a humble
condition, the Banking Sector of Bangladesh has grown to a great extent. At present there are 49
banks in Bangladesh. The structure of Banking in Bangladesh is under:
1. Nationalized Commercial Banks

2. Specialized Banks
3. Private sector Commercial Banks
a) Conventional Banks
b) Islamic Banks
4. Foreign Commercial Banks:
a) Conventional Banks
b) Islamic Banks
Sonali Bank is the largest among the NCBs while Pubali is leading in the private ones. Among
the foreign banks, Standard Chartered has become the largest in the country. Besides the
scheduled banks, Samabai (Cooperative) Bank, Ansar-VDP Bank, Karmasansthan (Employment)
Bank and Grameen bank are functioning in the financial sector. The number of total branches of
all scheduled banks is 6,038 as of June 2000. Of the branches, 39.95 per cent (2,412) are located
in the urban areas and 60.05 per cent (3,626) in the rural areas. Of the branches NCBs hold
3,616, private commercial banks 1,214, foreign banks 31 and specialized banks 1,177.
Bangladesh Bank (BB) regulates and supervises the activities of all banks. The BB is now
carrying out a reform program to ensure quality services by the banks.
Bangladesh Bank (BB) has been working as the central bank since the country's independence.
Its prime jobs include issuing of currency, maintaining foreign exchange reserve and providing
transaction facilities of all public monetary matters. BB is also responsible for planning the
government's monetary policy and implementing it thereby. The BB has a governing body
comprising of nine members with the Governor as its chief. Apart from the head office in Dhaka,
it has nine more branches, of which two in Dhaka and one each in Chittagong, Rajshahi, Khulna,
Bogra, Sylhet, Rangpur and Barisal.
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CHAPTER 3: OVERVIEW OF NCCB
3.1 Background of NCC Bank

National Credit and Commerce Bank Limited was incorporated in Bangladesh as a banking
company under the Companies Act 1994. The principal place of business is the registered office
at 7-8 Motijheel Commercial Area, Dhaka 1000. It carries out all banking activities through its
branches in Bangladesh. National Credit and Commerce Bank Ltd. bears a unique history of its
own. The organization started its journey in the financial sector of the country as an investment
company back in 1985. The aim of the company was to mobilize resources from within and
invest them in such way so as to develop country's Industrial and Trade Sector and playing a
catalyst role in the formation of capital market as well. Its membership with the browse helped
the company to a great extent in this regard. The company operated up to 1992 with 69 branches
and thereafter with the permission of the Central Bank converted in to a fully-fledged private
commercial Bank in 1993 with paid up capital of Tk. 39.00 corore to serve the nation from a
broader platform.
Since its inception NCC Bank Ltd. has acquired commendable reputation by providing sincere
personalized service to its customers in a technology based environment.
The Bank has set up a new standard in financing in the Industrial, Trade and Foreign exchange
business. Its various deposit & credit products have also attracted the clients-both corporate and
individuals who feel comfort in doing business with the Bank.
3.2 Mission
To mobilize financial resources from within and abroad to contribute to Agricultures, Industry &
Socio-economic development of the country and to pay a catalytic role in the formation of
capital market.
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3.3 Vision
To become the Bank of choice in serving the Nation as a progressive and Socially Responsible
financial institution by bringing credit & commerce together for profit and sustainable growth.
3.4 Positioning Statement

NCC Bank is a contemporary, upbeat brand of distinctive quality of service and solution that
offers a rewarding banking experience as preferred choice of banking partner every time,
everywhere.
3.5 Value
Trustworthy
Dependable
Reliable
Professional
Dynamic
Fair
3.6 Training
3.6.1 Human Resource Development (HRD)

Human Resources Development is focused on recruitment and in-house training for both on the
job and off the job Bank staff members through the Banks Academy. NCC Bank Limited
Training Institute is one of well-equipped institutions in the private sector was conceived of as
an in-house training center to take care of the training needs of the Bank internally.
Academy is fully equipped with a professional library, modern training aids and professional
faculty. Library has different books on banking, economy, accounting, management, marketing
and other related subjects. Since its inception Academy has not only conducted courses,
workshops and seminars as required by the Bank, but it has also organized training programs
abroad for the officials.
In addition the IT & Card division offers the following training activities for its employees.
3.6.2 Software Training
Flora Banking Software (Head Office and Branch Level)
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Software Bug Searching (Business Team)
Real Time Problem Solution
3.6.3 Network Training
Branch Network Support
IP phone Maintenance
Internet Communication
3.6.4 Hardware Training
Basic Hardware Setup Training
3.6.5 Card Division Training
All Visa Related Training
International Visa Compliance
Internal Credit Card Marketing
3.7 Human Resource Management
NCC Bank follows a structured service rules and compensation package for its workforce at all
levels. The bank provides various benefits like Provident Fund, Gratuity Scheme and
Superannuation Fund for its eligible staff. The Bank has adopted a new Human Resource Policy
for recruitment, promotion and training. The new policy includes detailed and specific criteria for
recruitment of competent candidates on the basis of merit only.
3.8 Management Information System (MIS)
MIS of NCCBL is at developing stage. The bank is currently using MIS Report only for
customer account related information and banks financial position. The bank has recently
launched online banking services at front office operations which facilitate any branch banking,
ATM Banking, 24 hours Phone Banking, SMS Banking and Internet Banking to all customers.
Except one, all branches of the bank are currently using Centralized Banking Software for their
daily transaction processing and routine reporting. Credit risk management is also available in
the centralized banking software. Besides, the bank has subscribed to ATM, VISA Debit and
Credit cards, which will be an important milestone in automation of banking services. It is
expected that with the introduction of new technology, the bank will be able to render better and
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efficient services to its customers that will enhance banks competitive value. The bank has taken
sufficient safeguard against disaster management and recovery. The bank has a Disaster
Recovery Site (DRS) in place replicating the DataCenter and its DR site is equipped with
compatible hardware and telecommunications equipment to support the live systems in the event
of any disaster. Yet the Bank is to develop modern MIS for use of management and other
offices for timely availability of vital data for planning and decision making purposes at the
appropriate time to augment profitability. Under the forthcoming Basel II implementation plan of
BB, banks will be required to have its IT system Basel II compliant.
3.9 Board of Directors
The board of directors consists of 25 members. Most of the directors are owners of large of
business groups having high net worth. Due to the predecessor companys involvement
investment financing sector of the country the bank inherited its top corporate customers.
The management of NCC Bank is more professional and highly experienced. Main shareholders
of the bank are leading industrialist and business magnets of the country.
As a fully licensed professional bank, NCC Bank Limited is being managed by a highly
professional and dedicated team with long experience in banking. They constantly focus on
understanding and anticipating customer needs.
As the banking scenario undergoes changes so the bank and its responsibilities itself changed in
the market condition. In the bank, boards of directors are the sole authority to take decision about
the affairs of the business.
AlhajMd. Nurun Newaz A.S.M. Main Uddin Monem Md. Abdul Awal
Chairman Vice Chairman Director
Board Of Directors
Board Of Directors
Amjadul Ferdous S.M. Abu Mohsin Abdus Salam

Chowdhury Director & Chairman, Director
Director Executive Committee
Mrs. Sohela Hossain Yakub Ali Md. Abul Bashar

Director Director Director
Md. Harunur Rashid Khairul Alam Chaklader Md. Moinuddin

Director Director Director
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K.A.M Haroon Md. Amirul Islam Mohammed Nurul Amin
Independent Director Independent Director & Managing Director & CEO
Chairman, Audit Committee
3.10Structure of the Bandorbazar Branch

Structure of the Bandorbazar Branch, Sylhet mainly divided on three parts. These are Loan &
Advances, Foreign Exchange, and another one is General Banking. Under the general banking
part there are also more parts are contains.
Structure of Kumarpara Branch, Sylhet
Loan & Advance Foreign Exchange General Banking
FDR Accounts
Account opening Cash Bill & Clearing Remittance
Figure: Structure of the Bandorbazar Branch, Sylhet

3.11 Ownership Pattern
Presently the bank is primarily owned by the local sponsors of the country. They hold 49.29%
shares and the rest (i.e. 50.71%) is held by the Financial Institutions, Foreign Investors and
General Public.
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Percentage of Shareholdings of NCCBL
Public issues; 35.58; 36%

Local sponsors; 49.29; 49%
Foreign Investors; 0.24; 0%

Financial Institutions; 14.89; 15%
Chart: Percentage of Shareholdings of NCCBL.
3.12 Branch Network

The Branch network of the NCC Bank Limited is quite strong. These branches are situated at
various strategically important commercial and industrial locations in the country. The above
branch network is expected to be sufficient to maintain required growth rate of the bank.
NCC Bank have 69 branched in various prime area of the country, in 2010, NCC Bank is going
to open another 10 (ten) new branches in Dhaka, Chittagong and other areas of the country.
3.13Nature of Business
NCC Bank Limited offers full range of banking services that include deposit banking, loans &
advances, export, import and financing national and international remittance facilities etc.
3.14 Competitive Conditions in the Business
The Banking Sector comprises of consisting of four major Nationalized commercial banks, two
agricultural banks and three DFI and a large number of private commercial banks including
about a dozen foreign owned private banks. They severely compete for savings/deposits and are
in search of sound investment/lending targets. Despite stiff competition, the private sector banks
earning have gone up significantly, especially for those having professionally managed
operations.
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My Job
I started my internship at NCC Bank Limited on 16 th September, 2013 and it was completed on
16th December. I was assigned to the Bondorbazar Branch. Working for three months in the NCC
Bank Limited, Bondorbazar Branch helped me to fulfil the requirements of obtaining practical
learning. My internship in NCC Bank Limited was a worthwhile experience and the exposure of
such an organization would be valuable for me. Before facing the real business world, I have
gathered prior knowledge about the organization culture
Nature of the job

In the first week my organization supervisor assigned me that I have to work in the General
banking department and Foreign exchange department throughout the three months. NCC Bank
Limited has a total of currently 78 branches operating all over the country. The overall branch
activities of NCC can be primarily divided into three departments. These are:
General Banking Department
Accounts and Credit Department
Foreign Exchange Department
General Banking Department

This department deals with the general activities of the bank that is the Account opening, Cash
receive and Cash payment, Dealing with the clearing house, Opening FDR account, Issuing the
pay order, responding the letters of different government and private organizations. In account
opening desk the customers may open much different kind of accounts for example they can
open Savings account, Current account, Special Notice Deposit account, Foreign Currency
Account, Different kind of Scheme account like Monthly Income scheme, Pension scheme,
Monthly Saving scheme, Double Benefit Scheme and many others.
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Foreign Exchange Department
We do the exchange all time. But foreign exchange is not like the regular exchange. Banks work
as a transaction agent for both the parties. There are some rules and regulations in foreign trade.
You just cant buy or sell whatever you like. Foreign exchange can be divided in two parts:
Export and Import.
Specific responsibilities of job

In The first week my supervisor told me that I have to work in the General banking department
and Foreign exchange department. In the general opening department I had mainly worked in the
accounts opening section,
At first I was assigned in the General Banking for two months and the tasks which I was assign
are:
Giving the customers the information what type of documents will be required to open
an account. I used to tell them they need two copies of their photograph and two
copies photograph of the nominee and the photocopy of the clients and nominees
national ID
Help the customers in opening new accounts as some of the customers were not that
much educated
Many Customers used to come for cheque deposits and I used to receive the accounts
payable cheque
Putting seals like payees account credited and received for clearing seals for
clearing
Writing the pay orders
Sometimes I used to give the customers their cheque book for which I have to take their
signature in the register book and verify their signature
I had to put the customer files of deposit forms serially I used to print, type and
photocopy the documents
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The last month I was in the foreign exchange department. Over there I did not have to
Interact with the customers but there were also responsibilities that I have done are:
Receiving the required documents from customers such the photocopy of National ID,
photocopy of Passport and the Trade License etc
Have to do a lot of photocopy in this departments
Distributing the Western Union forms to the clients
Receiving the phone and telling the customers to come for the missing
information
Picking up the phone, calling up customers for missing information
Putting different typed of seals on the documents
Different aspects of job performance

In my internship period was going on I was assigned many responsibilities as I was the only
intern at that time in the general banking department. In general banking department I was
working in the account opening and clearing section. These two services were performing from
the same desk. The different aspects of my job are summarized below:
I was assigned to give all the related information needed to open an account to the new
customers. Each day it was tough for me but still as it was my responsibility to capture new as
well as existing information to open an account opening and then gives that information to the
customers who are willing to open an account in this bank.
Again on the other hand I was also assigned to give the cheque books to the clients
Whenever they were coming to receive it .Beside this, I used to fill up the fill up the new as well
as existing customers deposit form
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CHAPTER 4: BANKING PRACTICES OF NCC BL (GENERAL BANKING)
General banking is the heart of all the banking operations. It performs the core functions of the
bank. It provides the direct and day to day services to the customers. It is the storage point for all
kinds of transactions of foreign exchange department, loans and advances departments & itself.
The main functions of general banking department are as follows:
Accounts opening section

Local remittance section
Foreign remittance section
Clearing and collection section
Cash section
Accounts section
4.1 ACCOUNT OPENING SECTION

Mainly the commercial bank deals with the depository accounts. The relationship between
banker and customer begins with the opening of an account. An account binds the banker and the
customer into contractual relationship. Bank mobilizes the fund by accepting deposits from the
depositors and allocates the fund by providing loan to the borrowers. For this purpose NCCBL
deposits and allocates with the following accounts:
Savings Bank deposit Account(SB)

Current Deposit Account(CB)
Fixed Deposit Receipt(FDR)
Short term Deposit Account (STD)
Premium Term Deposit (PTD)
Instant Earning Term Deposit(IETD)
Special Savings Scheme
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4.1.1 Savings Bank Deposit Account (SB)
A bank account into which personal savings are paid. Interest is paid on this account by the bank.
The general characteristics of this account of NCCBL are as follows:
A suited introduction is required for opening the A/C.

Depositors may deposit in his /her accounts as often as he /she likes.
Initial deposit for opening the account is Tk. 500/- and the account may be closed where
the balance falls below Tk.500/-.
A depositor may withdraw money from his/her account twice in a week.
Depositors may withdraw his/her deposited money up to 25% without notice but for
withdrawal of more than 25%, 7(seven) days notice is required.
If the depositors withdraw more than twice in a week or more than 25% of his/her
balance, the bank may realize service charge in its discretion.
If any excise duty/income tax etc. is levied by the Government on deposit/interest earned
the same will be paid by debiting depositors account.
If a depositor likes to close his/her A/C, service charge of Tk. 250/- will be deducted from
the account.
4.1.2 Current Deposit Account

An active account at a bank into which deposits can be paid and from which withdrawals can be
made by cheque. The bank issues cheque books free of charge and supplies regular statements
listing all transactions and the current balance. The general characteristics of this account are as
follows:
Current deposit account is unproductive in nature as banks loan able fund is concerned.
Sufficient has to be kept in liquid form, as current deposits are demand liability.
Thus huge portion of this fund become non-performing. For this reason banks do not pay
any interest to CD account holders.
Businessmen and companies are the main customers of this product.
The bank grants loans and advances through current accounts.
In NCCBL a minimum balance of Tk.1000 has to be maintained
Cheque books and passbooks and pay in slip books are issued to constituents free of
charge, but lost pass book will be replaced only on payment of Tk. 50/-.
Accounting opening procedure:
Step 1 Receiving filled up application in banks prescribed form mentioning what type
of account is desired to be opened. A KYC (Know Your Customer) form is filled
up by the customer himself/herself.
Step 2 Two copies of passport size photographs from individuals are taken; in case of
firms, photographs of all partners are taken.
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Applicants must submit the required documents and must sign specimen
signature sheet and give mandate.
Introducers signature and account number is verified by the legal officer.
Step 3 Minimum cash is deposited.
Step 4 The authorized officer give an account number and send the thanks letter to
his/her present address.
Step 5 If it is received by the customer, cheque book and pay- in -slip book is given
other wise not.
Required other documents and cautions:
Type of account holder Required Documents
In the name of individual Citizenship certificate issued by the commissioner or by

the Union chairman or other identification certificate
(academic certificate)
In joint name Same as individual
Proprietorship firm Valid trade license, Tax Payers Identification

Number(TIN)
Partnership Firm Partnership deed, Resolution of the partners regarding

account opening, Photographs attested of those who will
operate the account, Trade license, Mandate as to
operation of the account.
Public limited company Certificate of Incorporation, Copy of Memorandum and

Articles of Association, Certificate of Commencement,
Copy of Resolution of the Board Directors.
Private limited company Certificate of Incorporation, Copy of Memorandum and

Articles of Association, Copy of Resolution of the Board
Directors.
Non- trading concerns Registration certificate under the Societies Registration

(societies,clubs,Associations) Act, Copy of bylaws and regulations, Copy of Resolution
for opening and operation of account, Power of attorney
to borrow.
Cheque Book Issue:
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To facilitate withdrawals and payment to third parties by the customer, NCCBL
provides cheque book to the customer.
CD account chequebook contains 20 and 50 leaves, while SB account chequebook
contains 10 leaves. Bank maintains separate register in this regard.
A new chequebook should be delivered after submitting requisition slip.
4.1.3 Fixed Deposit Receipt (Fdr)

The NCCBL issues FDR for the customer. The fixed deposit account is repayable after the expiry
of a predetermined period fixed by the customer himself/herself. The FDR may be for one (01)
month, three (03) months, six (06) months, and twelve (12) months. The general characteristics
of FDR areas below:
Deposits are made with the bank for a fixed period of time.
The bank offers high rate of interest on such deposits.
Fixed deposit account is opened in customer choice time.
Procedure for opening of FDR account
The depositor has to fill up an FDR application form.

The banker takes the specimen signatures of the depositor.
Depositor is asked to deposit the sanctioned amount to the cash.
Necessary entries are given into the FDR register and into the computer.
An FDR is issued to the depositor acknowledging receipt of the sum of money mentioned
there in. It also contains the rate of interest & the date on which he will fall due for
payment.
Special Instructions: If not instructed principal amount with interest/ without interest is
automatically renewable for three months term at the rate interest prevailing at the time of
maturity.
4.1.4 Short Term Deposit (Std) Account:
The general characteristics of STD account are as follows:
Customers deposit money for a shorter period of time.

There is no time limit for STD account.
The NCCBL offered 6% rate of interest for STD account.
Value of STD account is generally high. Minimum balance is Tk. 2.00 lacs in case of
private deposit and 10.00 lacs in case of collection account.
Frequent Withdrawal is discouraged and requires prior notice.
4.1.5 Premium Term Deposit (Ptd)Account:

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The salient features of PTD are as below:
Period of the deposit is two(02) years fixed

Tk. 10 lacs and above but multiple of Tk. 1.00 lac is issued
Corporate bodies, individuals, Trustees of provident fund /benevolent fund etc. are
targeted group.
Interest is 1.00% above existing 12 months FDR rate or as revised from time to time.
80% loan may be allowed against lien of the Receipt/Instrument.
Before expiry of 12 months no interest is paid but interest payable for 12 months at
existing FDR rate for 12 moths deposit after deducting taxes/levies.
No Auto Renewal and no extra benefit for Post-mature Encashment.
In case of death, due money shall be paid to Nominee(s) of the account holder as
mentioned in AOF. If there is no nominee the amount will be paid to legal heirs as per
succession certificate.
4.1.6 Instant Earning Term Deposit Account(Ietd)

The main features of this account are as below:
Period of the deposit is one(01) year fixed

Minimum Tk. 1 lac and above but multiple of Tk. 1.00 lac is issued
Retired personnel, housewives, widow, wage earners are targeted group.
Interest is 1.00% below existing 12 months FDR rate or as revised from time to time.
75% loan may be allowed against lien of the Receipt/Instrument.
Before expiry of 6 months no interest is paid but interest payable for after 6 months at
existing STD rate.
No Auto Renewal and no extra benefit for Post-mature Encashment.
In case of death, due money shall be paid to Nominee(s) of the account holder as
mentioned in AOF. If there is no nominee the amount will be paid to legal heirs as per
succession certificate.
4.1.7 Special Savings Scheme

NCCBL offers the customers with NCC Bank Special Savings Scheme. The General
characteristics of this product are given below:
Two types of account can be opened under this scheme i.e., 5 years term and 10 years
term account.
Monthly installments of this deposit will be from TK 500/- upto 25000/-
A person may be open more than one account for different installment in a Branch/Bank.
No interest on the deposited amount shall be paid if the A/c is closed before six months.
In case of premature closure Tk. 100 will be charged.
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No withdrawal shall usually be allowed before 5 years .If any account is needed to be
closed before 5 years; Interest at prevailing rate on saving account shall be paid along
with the principal.
Monthly installment will have to be deposited by 10 th day of each month. Advance
installments are always acceptable.
In case of withdrawal of money by closing the A/c after 5 years (for 10 years term) full
amount applicable for 5 years term and interest at prevailing rate on saving A/C for the
rest period along with principal shall be paid.
Depositors may nominate one or more persons against the account as nominee.
On completion of any term (5/10 years) payment shall be made after one month from the
date of deposit of last installment.
Maximum up to 80% loan on deposit may be allowed to the account holder at ruling
lending rate of the bank.
The depositor(s) will be paid a fixed amount after expiry of the term as follows:
4.1.8 Interest Rate Of Nccbl On Deposits
SI. No. Category of Deposits Rate of Interest
01. FDR for 3 Month 11.5%
02. FDR for 6 Months 11.5%
05. Savings Bank Deposit 6.00%
06. Short term Deposit 6.00%
07. Special Deposit Scheme 13.40%

(for 3 years)
08. DPS 13.00%
4.2 LOCAL REMITTANCE SECTION

In banking language money transmitted domestically are known as local remittance. For local
remittance purposes NCCBL purchases and sells some instruments for its customers. The
instruments are Pay Order (PO), Demand Draft (DD), and Telegraphic Transfer (TT).
4.2.1 Pay Order (P.O.)
Pay order is an instrument which is used to remit money through banking channel. The
instruments are generally safe as most of them are crossed. The money which is received by the
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bank from selling the instrument is kept under bills payable account. It is current liability on the
part of the bank, which implies that money received in this purpose has to be paid to the payees
collecting bank on placement of the instrument. The bank charges a little amount of commission
for this purpose as under:
Up to Taka Commission and VAT

(Tk.)
Up to 5000/- 23/-
1,00,000/- 58/-
10,00,000/- 230/-
Procedure for Selling Pay Order:
Purchaser must be an A/c holder of NCCBL. For government /institution A/c is not
needed.
Deposit money with P.O receipt.
Give necessary entry in the Bills Payable P.O Register and into the computer (Payees
name, date, P.O No etc.)
Prepare the instrument.
After it has been scrutinized and approved by the authority, the instrument is delivered to
the customer. Signature of the customer is taken in the counterpart.
Settlement of a P.O.
When P.O. is submitted by collecting bank through clearinghouse, the issuing bank gives
payment. The banks liability is settled by debiting bills payable. If buyer wants to cancel the
P.O. he has to give a letter of instruction in this regard. He will also have to return the instrument.
Incase the P.O is lost the holder whether buyer /payee will inform it to the issuing bank
immediately. Bank will mark stop payment on P.O. register. Buyer will then ask for a new
instrument by submitting a G.D. copy and paying indemnity. Then the new instrument is issued.
Collection of P.O.:
A customer of NCCBL who is the payee of a P.O. will deposit it for collection. The instrument is
given to the clearing that will place it to the issuing bank in the clearing house. Before placement
NCCBL as a collecting bank gives necessary endorsement.
4.2.2 Demand Draft (Dd)
Demand Draft is very much popular instrument for remitting money from one corner to
another. The instrument basically used for transfer and payment. The difference between
PO and DD is that Pay Order ends with issuing Branch but DD ends with other branch.
DD also constituents current liability on the part of a bank. At NCCBL DD is not issued
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to people other than its customers.
Procedures for issuing DD:
DD application filled in and money deposited by the customer.

Necessary entries are given into the register and into the computer. A number which is
taken from the register is known as controlling number.
An Account Payee Only crossed instrument is given.
Preparing an I.B.C.A. (Inter Branch Credit Advice). Issuing an IBCA implies that the
branch is being credited to whom it is issued. It contains the controlling number.
Lodgment is given after receiving an IBCA. Necessary entry is given in a register called DD-
issuing Branch, controlling number of the IBCA should match the serial number of this DD in
register. When finally the instrument arrives through clearing, the cancellation mark is given on
the register. In case where IBCA has not yet received from the issuing bank but instrument has
been placed, bank can not hang a party for the IBCA. In this case
Payment is given to the party from the suspense account.
Suspense A/cDr.
Customer a/cCr.
Latter on it is adjusted after receiving the payment from the issuing bank.
Issuing bank A/cDr.
Suspense A/cCr.
If the holder of the instrument wants to cancel it, he should submit a request letter in this regard.
Issuing branch then sends an IBDA to the drawn on branch against the IBCA which was sent
previously. When the instrument is lost a duplicate is given after fulfillment of the conditions.
The holder should immediately inform to the bank for stop payment.
4.2.3 Telegraphic Transfer (Tt)
Telegraphic Transfer is one of the fastest ways of remitting money from one branch to another.
Both parties should have account in the bank. An instrument is given for this purpose.
Procedures of outgoing TT:
Application by the customer

In receipt of money, memo is given to the customer containing TT serial number. The
customer informs this number of the awaiting party in the other branch.
Telephone call is made to the recipient branch to inform TT serial number, the name of
the party and the account number.
Procedures of Incoming TT:
After receiving the telephone call, TT serial number is scrutinized in the TT register.
Cash voucher is released in this respect.
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No charge or commission is applicable in this respect.
4.3 FOREIGN REMITTANCE SECTION
NCCBL serves the customer with the online system of money transfer called foreign remittance.
Under foreign remittance section, the following products are included:
MoneyGram (International Money Transfer)

Xpress Money
AFX Fast Remit
Habib Express
Habib Qatar
First Solution, UK
FTT (Foreign Telegraphic Transfer)
FDD(Foreign Demand Draft)
FC A/C
4.3.1 Moneygram
MoneyGram Is the online system of international money transfer. It is a fast, easy, reliable and
convenient way to send or receive money in minutes around the world. There are four parties are
involved in this system i.e., sender, service representative, bank and receiver. This service is
provided by MoneyGram payment system Inc.(MoneyGram) through its network
Representatives (service Rep).
Procedures of remitting money through MoneyGram:
The sender will go to the MoneyGram service representatives centre and send dollar or
other currency which convertible to taka and get 8 (eight) digit reference number.
The sender informs the reference number to the receiver instantly by phone or other fast
services.
The receiver goes to the home countrys MoneyGram centre and fills up MoneyGram
Receive form and submits it to the responsible officer.
The responsible officer entry the reference number into the online connected computer
into the prescribed form and compare the filled up form with online information. If both
information are same he will authorize the form and give the duplicate copy to the
customer. A Tk.4 (four) revenue stamp is required for this purpose.
Then the customer collects the cash amount from the counter.
4.3.2 Xpress Money

It is also an online money transfer system. It is controlled by UAE Exchange Ltd.
Procedures for collecting Express money:
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16 digit Xpin code is given
Fill up the prescribed form supplied by the NCC bank
The authorized officer enters the PIN into the online connected computer and verifies the
given information.
Print 3 copies of the adjusted document. One copy for head office with the main form and
one copy for the branch and another copy to the customer.
Send the customer to the cash counter for collecting cash.
4.3.3 Afx Fast Remit

Afx fast remit means Alfardan Express .It is controlled by the Qater based company , Alfardan
exchange co. L.L.C,Grand homer street, P.O. Box No. 339, Doha , Qater.It is also an online
money transfer system. It has also 16 AFX Fast Remit No. And other procedures are same as the
Xpress Money.
4.3.4 Habib Express

It is also an online money transfer system. For Habib Express 13 digit XPIN No. is given.
The customer has to fill up the Information on Habib Express form and other procedures are
same as Xpress Money.
4.4.5 Habib Qater
It is another system of international money transfer. Information comes to the bank with a sheet
from head office. The banker compares this sheet when the customer comes to draw the amount.
4.3.6 First Solution, UK.
The systemof this service is same as Habib Qater. It is UK based money transfer system.
4.3.7 FTT (Foreign Telegraphic Transfer)
For FTT Bangladesh Bank supplies a T/M (Traveling and Miscellaneous) form which is to be
fulfilled by the clients mentioning his account number and corresponding bank account number
of the abroad to whom the amount is to be sent. The authorized officer vouchering the cash
which is to be transferred against the senders F/C account. The NCCBL then send a massage
regarding FTT to the corresponding foreign bank through SWIFT. With this service foreign
currency especially USD or Euro is sent with in a short time
4.3.8 FDD(Foreign Demand Draft)
An application should be written by the client for FDD against his F/C account mentioning the
amount and the targeted bank. The bank officer then debited the amount against his /her F/C
account
Fourcopy of FDD form must be fulfilled by the officer as below:
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a) Main copy, b) Advice copy, c) Copy for ID (HO), d) Office copy
The authorized officer then enters the FDD record into the computer and the register. The main
copy of FDD is to send to the correspondent bank.
4.3.9 Foreign Currency Account
The person who is living in abroad can open F/C account in this Motijheel Main Branch of
NCCBL. Foreign nationals residing in Bangladesh are allowed to maintain and operate their
foreign currency accounts abroad. Foreign currency accounts may be opened in the names of
resident Bangladeshi nationals working with the foreign/international organizations operating in
Bangladesh provided salary is paid in foreign currency. The account can be opened either in
Pound Starling, US Dollar, Deutsche Mark or Japanese Yen or the option of the prospective
account holder and maintained as long as the account holder desires. Funds lying to the credit of
FC account Bangladeshi nationals can be utilized for import of goods and commodities as per
instructions issued by the CCI& E and Bangladesh Bank.
Procedure of Opening FC account: The migrate is required a mandate who is the account
holder of this bank or other officer of this bank. The form which is to be fulfilled by the A/C
holder and the mandate are:
Authority for operating on an account

(Mandate form)
Declaration for opening of foreign currency account form

Foreign currency account opening form
Signature verifying form
Requirements:
2(Two) copies photograph of the applicant and 1(one) copy for the mandate
Copy of passport, VISA, Identity card of the foreign country.
The authorized officer verifying the mandate signature and all the information supplied by the
applicant. Then He /She gives an FC account number and filed the papers separately and
recording into the computer.
Special conditions for FC A/c:
No interest is paid on the account

An initial deposit of foreign currency not less than equivalent Taka 25000.
4.4 CLEARING AND COLLECTION SECTION

Customer pays and receives bill from their counter party as a result of transaction. NCCBL
collects the bill on behalf of their customers. Collection mechanisms in NCCBL are clearing,
Outward Bills for Collection (OBC), Inward Bills for Collection (IBC).
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4.4.1 Clearing
The most important part of this branch is clearing section. The motijheel main branch and other
69 branch are under this section. The chaques which are received from the customer other than
NCCBL for collection; those are sent to clearing section. Suppose A party has an account in
NCCBL and B party has an account in Agrani bank. A is given a cheque for his amount paid
(Agrani banks cheque). A submit the cheque to NCCBL to collect through clearing house.
Procedure of clearing:
The party or other branches submit the cheque, which is to be collected through clearing
house, to NCCBL Main Branch. The also submit a floppy disk which contains cheques
information.
The authorized officer sign the duplicate copy of credit receipt and put receive seal on it.
The authorized officer the cheques information into Bangladesh Bank clearing software.
Three seals are put on it (Crossing , clearing and received payment seal)
The authorized officer take away the cheques to Bangladesh Bank at every 9.30 AM
clearing seating and the cheque which is more than tk.5,00,000/- , send at 11.00Am
clearing seating.
The cheques are divided into the attending branch by the Bangladesh Bank.
The cheque which is received by the Motijheel branch from clearing house entered into
the register book (cheque No. , A/c No., collecting bank, amount) and send them to cash
department.
In cash, the authorized officer verifies the account. If the cheque is not fulfilled with the
requirements, it will be returned. The returned cheques date is edited and endorsed
cutting date confirmed and gives signature.
The cheque which has been returned, send at 5.00 pm clearing house, called Returned
House.
This process requires one day but more than Tk. 5,00,000 is cleared on the very day.
Reason of return of cheque:
Insufficient fund
Amount in figure and word differs
Cheque out of date/ postdated
Drawers signature differs
Payment stopped by drawer
Crossed cheque to be presented through a bank.
Payees endorsement required
Other specific reasons not mentioned above.
4.4.2 Outward Bills for Collection
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If the bill is beyond the clearing range then it is collected by OBC mechanism. Customer deposit
cheque, drafts etc. for collection, attaching with their deposit sleep, instrument within the range
of clearing are collected through local clearing house, but the other which are outside the
clearing range are collected through OBC mechanism.
4.4.3 Inward Bills for Collection:
When the bank collects bills, as an agent of the collecting branch, the system is known as IBC. In
this case the branch receives a forwarding letter and the bill.
4.5 CASH SECTION
Cash section demonstrates liquidity strength of a bank. It is sensitive as it deals with liquid
money. Maximum concentration is given while working on this section. As far as safety is
concerned special precaution is also taken. Tense situation prevails if there is any imbalance in
the cash section.
Functions of Cash Department:
Cash Payment: Cash payment is made only against the printed valid cheque of NCCBL.
Cash Receipt: The branch receives deposits from the depositors in the form of cash. It collects
money only its receipt forms.
Cash Payment Procedure:
Receiving Cheque by the employee in the cash counter.

Verifying the cheque into the computer by the cash officer.
Give pay cash seal and send to the payment counter.
Payment officer makes payment.
All the information regarding receives and payment are recorded in the separate register book
carefully.
4.6 ACCOUNTS SECTION
All the financial activities are preformed in this section. Both computer records paper documents
maintained in the account section. The previous and old records are field in sequence and kept
prescribed for future needs. All types of voucher are sent to the account section. By this way this
section maintains an accurate measure of the branch activity. As the main branch of NCCBL,
A/C section is liable to receive all statements related to account department of the other branch.
The account section of Motijheel Branch of NCCBL performs the following functions:
1. Reports of trail balance on daily basis and documents are kept by serial basis.
2. Profit and loss account at the book closing date.
4. Balance sheet on the ending year.
4. All types of expenditures.
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5. Posted voucher
CHAPTER 5: BANKING PRACTICES OF NCC BL (CREDIT)
As a private commercial bank, NCCBL has some inherit commitments to its society. By
utilization the fund from the mobilized deposit NCCBL is fulfilling its commitment which can
gear up the economic activity. NCCBL has been extending credit facilities to the potential,
productive and priority sectors as per instruction from Bangladesh bank. For a bank, good loans
and advances are most profitable asset. A big portion of operating income is derived from
lending. This activity is done by the loans and advance department.
5.1. Classification of Loans and Advances

Bank is an institution where clients keep their surplus deposits and these deposits are invested in
trade, commerce and industries in the form of Loans & Advances to earn profit. Apart from
earning profit, by lending to priority sector, Bank also helps countrys economic development.
Lending activities of the Commercial Banks are of two natures:
(A) Continuous Credit.
(B) Term Loan.
In continuous credit the client is given a credit limit for a specified period mostly for 1 (one)
year. The borrower is allowed to make transaction up to that limit. In other word, he can deposit
and withdraw up to the fixed limit in revolving manner.
On the other, in case of Term Loan, Loan is first disbursed at a time or in phases. Then it is
borrowers turn to repay the Loan after a certain fixed period at a time or in installments fixed for
within a certain period.
(A) Continuous credit

(i) Cash Credit (Hypothecation): This facility shall be available both for Trading Houses
and. Manufacturing concerns against primary security of hypothecated inventory/ stocks of
Finished, Raw Materials and machineries.
However, as the primary security remains at the disposal of the borrower with practically no
control of the lending institution, NCCBL shall extend such facility only against retention of
adequate eligible Collateral Security favoring bank. Criteria of such Eligible Security shall be as
per circular of Head Office and within the guideline set by Bangladesh Bank in this regard
(ii).Cash Credit (Pledge): NCCBL shall retain the provision to extend WC finance under
the head. As the Primary Security i.e. Finished or Raw by regulation is supposed to be under
27
strict control of the bank, the arrangement on practical experience eventually proves
cumbersome due to numerous difficulties in maintaining the formalities related to strict
supervision and monitoring. Therefore, NCCBL shall prefer to consider such facility only under
Hypothecation unless assurance and arrangements are available about compliance on the spirit of
the portfolio.
(iii) Secured Overdraft (Financial Obligation): Credit Facility in the form of

Loan and Overdraft can be considered against Lien of various Financial Obligations subject to
credit restriction or any directive as imposed by regulating authorities or Head Office. Necessary
guidelines with regard to extension of the facility shall be as per direction of the Head Office/
Bangladesh Bank.
(iv) Secured Overdraft (General): NCCBL shall consider facilities under the portfolio
against valid Work Order/Supply Orders payment against which shall be duly assigned favoring
the bank by the work awarding office/ agency. The portfolio in nature shall be of a Loan type and
not continuous. The WO shall be construed as Primary Security in this regard. However, as the
nature of facility carries inherent risk, NCCBL shall prefer Collateral Securities while
considering facilities under the head.
(B) Term Loan

(i) Project Loan: NCCBL shall allow Loans for longer duration to enable its investment
to be returned by way of repayment after detailed assessment and feasibility study as per its
guideline for entrepreneurs and investors willing to come to an arrangement in setting up
industries and different production unit complying to rules and regulations of governments
Investment & industrial policy. As investment shall be for longer duration and fraught with
unforeseen risks, bank shall obviously seek adequate eligible securities to cover itself.
Acceptance of such securities shall be as per laid down principles of the bank and Bangladesh
Bank guidelines in this regard.
(ii) House Building Loan: Bank shall allow credit facilities under such portfolio strictly
as per PPG within the Prudential Regulations of Bangladesh Bank for Consumer Financing.
(iii) Packing Credit: This facility also relates to financing at Pre shipment stage. NCCBL
shall consider such facility under defined guidelines against export of various commodities.
(iv) Loan against Imported Merchandise (LIM): Loan against the security of merchandise
imported through bank shall be allowed against Pledge of goods. The procedure and conditions
for allowing such facility under prior arrangement or forced circumstances shall be strictly as per
related guideline of the bank. Due to inherent complexities, the portfolio should be discouraged.
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(v) Loan Against Trust Receipt (LTR): Bank shall be selective in extending the facility
but shall prefer due to comfort in binding the customer legally.
Generally such facility shall be against arrangement and preferable against collateral security
favoring the Bank.
(vi) Transport Loan: NCCBL may extend Transport Loan on close scrutiny of the
purpose, Feasibility, experience of the borrower, credit/trust worthiness and above all security
aspect as per its guidelines in this regard.
(vii) Lease Finance: An entrepreneur, under this scheme may avail of lease facilities to
procure industrial machinery and equipments, Vehicles etc. (without having to purchase it by
down payment) with easy repayment schedule on case to case basis. Rate of interest under this
Scheme is 16% P.A.
(viii) Payment against Documents (PAD): This facility originates against payment of
Import Bills on lodgment of CLEAN shipping documents received from Foreign Correspondent
against Letter of Credit opened on behalf of the customers.
(ix) IBP & FBP (Inland &Foreign Bills Purchased): The facility relates to extension of
credit at the post Shipment stage. NCCBL shall consider facility under the portfolio to relieve the
exporter strictly on complying standing conditions attached to it.
5.2. NCC Banks Special Credit

Its based on the common credit requirement of the society. Besides, these products have
expanded the Bank with diversified source of income. These are:
(a) Small Business Loan
(b) Personal Loan
(c) House Renovation Loan
(d) Consumer Finance
(e) Festival Business Loan.
(f) Festival Personal Loan.
(g) NCC Bank Housing Loan Scheme.
(h) Festival Business Loan: The scheme designed to help the genuine businessmen to
meet the extra finance required during festivals like, Eids, Puja. Disbursement of this loan is
made in recycling order which is to be stopped 15 days before the festival day. Maximum
Tk.10.00 lac is allowable under this Scheme @ 16% interest P.A. at quarterly rest. Application
fee is Tk.500
29
(i) Festival Personal Loan: The scheme formulated to meet emergency financial expenses
of the service holders at the time of festivals like Eids. Puja. Any salaried employee aged
between 20- 50 years and working in Govt. Semi - Govt. Autonomous organization, corporate
bodies, Insurance Co., etc. are eligible to avail of this loan. The disbursement of this loan starts
before 1 month of festival and continues till festival. Borrower may be allowed to avail of
maximum Tk. 15,000/- only for minimum 6 months but not more than 15 months @ 16%
interest P. A. at quarterly rest. Application fee is Tk. 100/-.
(j) NCC Bank Housing Loan Scheme: In order to enable the service holders/ profess
ionals/ businessmen in purchasing Flat/House, Construction of Building and renovation, the
Bank launched Housing Loan Scheme from September 2004. The tenure of the loan is maximum
12 years and maximum amount of loan is tk.50.00 lac with interest @ 16% P.A.
5.3. Modes of Credit

Credit can be categorized according to the nature and modes of payment.
(a) Term Wise Classification:
ii) Short term (=<1 year)
ii) Mid term (=>1 year to 5 years)
ii) Long term (> 5 years)
(b) Nature Wise Classification:
i) Loan: fixed in nature, for a particular term or time.
ii) Advances: continuous in nature with no fixed repayment schedule but an expiry date,
for example: Cash Credit (hypo), Overdraft etc.
(c) Purpose Wise Classification:
i) Working Capital: For manufacturing units to meet their short-term obligation and day-
to-day expenditure.
ii) Fixed Asset Finance: For acquisition of long-term capital assets.
(d) Sector Wise Classification:
Commercial Lending: for commercial requirements except export. It is for short and medium
from of loan. Example: LIM, LTR, PAD, SOD, Cash Credit, Loan General.
i. Industrial Credit:
ii. Agricultural Credit
iii. Transport Credit
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iv. House Building Loan
(e) Classification based on Fund Involvement:
i. Fund Facilities: direct money involvement
ii. Non-Funded Facilities: where fund is not extended directly. Example:
Letter of Credit, Letter of guarantee, Bank Guarantee etc
5.4 Types of Credit in Foreign Trade

i. Loan against Imported Merchandise (LIM)
ii. Payment against Imported Documents (PAD)
iii. Packing Credit (PC)
iv. Loan against Trust Receipt (LTR)
v. Back to Back Letter of Credit.
The Bank has made remarkable achievement in recovery of non-performing and classified loans
advances during the period under review, As a result, Banks ratio of classified loans to total loans
on December 31, 2006 has come down to 5.62 percent, from 5.66 percent of the previous year.
This achievement was possible due to continuous monitoring, follow-up and negotiation with the
clients.
5.5 Lending Authority

The lending officers are broadly categorized as follows-
Managing director
Deputy Managing director
Executive vice president
Senior vice president
Vice president
Senior assistant vice president
Assistant vice president
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5.6 Sanction of Credit
When a Branch Manager writes a letter to accepting all terms and conditions of loan, it is called
loan sanction. After the completion of all the formalities of financing a loan proposal, an
advising letter is sent to the customer for the credit facilities along with all terms and conditions.
The conditions, which are included in the loan sanctions, are given bellow:
a) Limit
b) Primary Securities
c) Collateral Securities
d) The Rate of Interest
e) Expiry Date
(f) Repayment
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CHAPTER 6: BANKING PRACTICES OF NCCBL (FOREIGN EXCHANGE)
6.1 Foreign Exchange

Foreign exchange business plays a vital role in the socio-economic sector especially in a country
of third world like Bangladesh. Foreign trade financing is an integral part of banking business.
Firms or organizations require foreign exchange to purchase goods from abroad or for purposes
of investment or speculation. According to foreign exchange regulation Act, 1947 as adopted in
Bangladesh, Foreign exchange means foreign currency and includes all deposits, credit and
balances payable in foreign currency as well as all foreign currency instruments, such as drafts,
travelers Cheques, bills of exchange and promissory notes payable in any foreign country.
Anything that conveys aright to wealth in another country is foreign exchange. With the
globalization of economies international trade has become competitive. Duly payment for
exports and quick delivery of goods is, therefore a pre- requisite for successful international trade
operations. Letter of Credit is the main document of foreign exchange financing. Letters of
Credits (L/Cs) is the main document of foreign exchange financing. It is also called
Documentary Credit.
6.2 Letters Of Credit / Documentary Credit (L/Cs):
A letter from one banker to another authorizing the payment of a specified sum to the person
named in the letter on certain specified conditions. In an export contract, the exporter may
require the foreign importer to open a letter of credit at the importers local bank (called issuing
bank) for the amount of the goods. This will state that it is to be negotiable at a bank (negotiating
bank) in the exporters country in favor of the exporter; often, the exporter (who is called the
beneficiary of the credit) will give the name of the negotiating bank. On presentation of the
shipping documents (which are listed in the letter of credit) the beneficiary will receive payment
from the negotiating bank. Thus documentary credits are akin to bank guaranties. Documentary
credit have gained wider acceptance in international trade for they try to safeguard the interest of
both the buyer and the seller by reducing their risks.
6.3 Banks Operated In Documentary Credit

Mainly five types of banks are involved in L/C operation as under:
Issuing bank: The bank which primarily issues the documentary credit in accordance
with the application of the importer, is called issuing bank.
Advising bank: The bank which advises the genuineness of the credit to the
beneficiary is stated as advising bank. This bank is normally situated in the
beneficiarys country place.
Confirming bank: A confirming bank is one which adds its guarantee to the credit
opened by another bank, thereby, undertaking the responsibility of payment /
negotiation /acceptance under the credit in addition to that of the issuing bank.
33
Negotiating bank: It isthe bank, nominated or authorized by the issuing bank, to make
payment liability, to accept drafts or negotiate the credit.
Reimbursing bank: A reimbursement bank is the bank authorized to honor the
reimbursement claims in settlement of negotiation /acceptance or payment lodged with
it by the negotiating or accepting bank. It is the correspondent bank of the issuing bank
with which the issuing bank has an account from which payment is to be made.
Authorised Dealer (Motijheel Main Branch Of Nccbl)
The central bank of our country known as Bangladesh Bank authorizes the commercial banks to
deal in foreign exchange business. The authorizing banks are called authorized dealer .They act
as an agent of the central bank supervised under the foreign exchange control act and guidelines
of the central bank. NCC Bank Ltd. is the agent of the central bank among which Motijheel Main
Branch is one .This branch possesses a good reputation with the importers and exporters. The
concerned officials are widely experienced in this respect.
The foreign exchange department of Main Branch of NCC Bank Ltd. is mainly divided into three
sections:
Import section
Export section
Collection Section
6.4 Import Section

Buying of goods & services from foreign countries is known as Imports. Incase of import,
importers are asked by their exporters to open letters of credit so that their payment against
goods is ensured.
Requirements to be an Importer:
The following documents are required to submit in order to get a license of import through
Motijheel Main Branch of NCC Bank Ltd.:
A bank account with the branch

Import Registration Certificate (IRC) (renew every year) from CCI&E
Tax Payers Identification Number (TIN)
VAT Registration Certificate
Membership certificate from a Recognized Chamber of Commerce and Industry or other
trade association
Pro-forma Invoice
Letter of Credit Authorization (LCA) form properly filled up and signed by the importer
Letter of Credit (L/C) Application duly signed by the importer
Insurance Cover Note
IMP form
34
Import L/C Opening Procedure:
The importers apply with an application and the required documents for opening L/C. Then the
bank officials supply prescribed forms i.e., Revival form, LCA form, IMP form etc to fill up by
the importer. The Managing Director or Proprietor of the organization should have duly signed in
the form with seal. Then the bank office will send the form and application to the head office.
After verifying the documents and application, the head office will send the copy to the central
bank. Finally the Bangladesh Bank checks the documents and finds whether the importers loan
clearance to the other bank and return the copy to the bank. If all the information is clear, the
bank officials will give him an L/C number and entries the accounting treatment into the L/C
opening registration book and into the computer. The bank makes an L/C copy where all the
information regarding regulations and limitations for the L/C consists and supply one copy to the
importer.
Scrutinization Of L/C Application
On receipt of L/C application the branch officials scrutinize the same very carefully giving
emphasis to the following points whether
L/C application is properly stamped as it is a guarantee of payment

All information mentioned in different columns have been furnished
The items to be imported are eligible according to import entitlement
If L/C is opened against indent, Bangladesh Banks permission, valid registration,
authority to issue indent by indenter are to be checked
The terms and conditions stipulated in the L/C application are consistent with the
Bangladesh Bank Foreign Exchange Guidelines, Import Trade Regulations, and UCPDC
etc.
The amount and description of merchandise are relevant to LCAF and pro-forma
invoice/purchase order
Shipment/ Transshipment by Israeli / Iraqi flag vessels strictly prohibited and a
declaration from concerned shipping line
Accounting Treatment In Case Of L/C Opening

After sanctioning the L/C proposal the bank officials will cut the following vouchers:
Party A/C......................................Dr.
Sundry deposit A/C -Margin on L/C.Cr.
Income A/C-Commission on L/C...Cr.
Sundry deposit A/C-VAT (15% of commission) ...Cr.
35
Income A/C-Postal (Tk.200).Cr.
Stamp and stamp form in hand (Tk.150)Cr.
Income A/C-Telex ...Cr.
Then the L/C is transmitted through Airmail/Courier services/SWIFT/Telex to the Advising
bank, tested telex to advise the L/C to the beneficiary. Reimbursement authority is sent to the
Reimbursing bank simultaneously in case of At Sight L/Cs. Telex charge to India is Tk. 1200
and other than India Tk 3000 is charged.
Aendment Of L/C
Parties in an L/C, particularly the importer and the exporter cannot always satisfy the terms and
conditions in full as expected due to some obvious and genuine reasons. In such a situation, the
credit should be amended. Motijheel main Branch of NCC Bank Ltd transmits the amendment by
telex/ airmail/courier service/SWIFT to the advising bank. In case of revocable credit, it can be
amended or cancelled by the issuing bank at any moment and without prior notice to the
beneficiary. But in case of irrevocable letter of credit, it can never be amended nor cancelled
without any agreement of the issuing bank, the confirming bank (if any) and the beneficiary. If
the L/C is amended, amendment charge and telex charge, as per HO circular, are debited from
the partys A/C accordingly.
Add Confirmation
Sometimes beneficiary or supplier of the goods insists the importer for adding confirmation to
L/Cs or to issue L/Cs with add confirmation. In that case, at the request of the importer, the
issuing bank requests the advising bank or any third bank to add their confirmation to the L/C.
Normally, add confirmation charge is borne by the beneficiary and the confirmation charge
differs from bank to bank.
About Shipping Documents
If the exporter is satisfied with all the terms and conditions as stated in the L/C, he proceeds to
dispatch the goods to the importer. Then the exporter submits the documents evidencing of
proceedings to the negotiable bank. After that the negotiable bank scrutinizes the documents
against L/C. If all the documents are found in order, the bank will negotiate with the documents
and send copy of which to Banani Branch. Then the branch scrutinizes the documents. The main
documents are as under:
Invoice
Bill of Lading
Certificate of Origin
Packing List
Shipping Invoice
Non-negotiable copy of Bill of Lading
Bill of Exchange
Pre-shipment Inspection Report
36
Shipping Certificate
About Discrepancy
If the Motijheel main Branch of NCC Bank found any discrepancy or dissimilarity of the stated
documents, the banks inform the negotiating bank about discrepancies with in seven working
days. For each set of discrepant document an amount of USD 150 will be deducted at the time of
payment as discrepancy and cable charge. Some common discrepancies are as below:
L/C expired
Late shipment
Amount drawn in excess of credit
Bill of exchange not properly drawn
Description of goods differ
Interest clause is missing in Bill of Exchange, where stipulated
Insurance cover note as per terms of L/C and insurance does not cover the entire voyage
and insurance policy is not properly stamped.
Additional Conditions
Invoice should indicate import under cash foreign exchange resource

Shipment must not be made before the credit issuing date
Third party documents not acceptable
Short term/ black back bill of lading not acceptable
L/C number and date must be mentioned in all shipping documents
Pre-shipment inspection for quantity, quality, description, classification and price
should be carried out by the beneficiary. The final invoice and packing list should
be indorsed by the beneficiary with the number and date of issuance of the CRF
which shall be sent to the credit issuing bank by the negotiating bank at the time
of negotiation of shipping documents.
Applicant TIN number should be mentioned in all shipping documents
Lodgement And Retirement Of Documents

When all the documents are collected by the bank (Motijheel main branch), the bank procure
cash from the importers account against documents known as Payment Against Documents
(PAD). Then the PAD is sent to the Head Office ID through IBTA (Inter Branch Transfer
Advice).This process is called lodgment. Accounting Treatment for this is hereunder:
PAD A/CDr.
Foreign Banks A/CCr.
L/C Magrin A/CDr.
PAD A/CCr.
37
6.5 Export Section
Goods or services sold to foreign countries are called export. Bangladesh exports a large quantity
of goods and services to foreign households. Readymade textile garments (both knitted and
wove), jute, jute made products, frozen shrimps, tea are the main goods that Bangladeshi
exporters export to foreign countries. Garments sector is the largest sector that exports the lion
share of the countrys export. Bangladesh exports most of its readymade garments to USA and
European Community (EC) countries. Most of the exporters who export through Motijheel Main
Branch are ready made garments exporters.
Who is Exporter?
Foreign Exchange Trade i.e., Imports & Exports Trade of the country are regulated by the
Import, Export Control Act 1950. No person/firm is allowed to export anything from Bangladesh
unless he is registered with CCI & E under the registration order (Importer & Exporter) 1952.
So, ERC is a must to be an exporter.
Procedure for obtaining Export Registration Certificate (ERC):
For obtaining Export Registration Certificate (ERC), intending Bangladesh Exports are required
to apply to the CCI&E authority in the prescribed from along with the following documents:
Nationality Certificate
Copy of valid Trade license
Bank Certificate
Copy of rent receipt of the business firm
Income Tax Certificate
Registration partnership Deed in case of partnership concerns
Memorandum of Association & Articles of Association and Incorporation Certificate in
case of limited company.
Get the name of the Importer/Buyer

The following authorities will be able to furnish the names of the foreign buyers
The export promotion Bureau

Trading Corporation of Bangladesh
Direct Trade Deals of the Government
Trade Fairs
Trade Directories of the world
Commercial Banks calendars of commerce and Trade associations
Commercial Representative of Governments located in our country
The Commercial Representative located in our Embassies/high commission abroad
World Directory of Industry and Trade Associations
38
Export service organization i.e. shipping lines, airlines, marine insurance firms etc
Export Procedures
The exports from Bangladesh are subject to export trade control exercised by the Ministry of
Commerce through Chief Controller of Import &Export (CCI&E).The procedures of export
business in Bangladesh are given blow:
Getting Export Registration Certificate(ERC) from CCI&E (renew every year)

Apply to the bank with the required documents
Fill up the EXP form
Securing the order from the buyer through correspondence
Making and signing of the contract
Procuring the required raw materials
Registering for sale
Shipment of goods
The following documents are involved for shipment of goods:

a) EXP form, b) Copy of Registration Certificate, C) Copy of contract, d) Copy of the L/C, e)
customs copy of ERF form for the shipment of jute made goods and EPC form for raw jute, f)
freight certificate, g) railway receipt, or truck receipt, h)Shipping instructions and i) insurance
policy.
The following points should be checked
The terms of the L/C are in conformity with those of the contract
The L/C is an irrevocable one, preferably confirmed by the advising bank
If the importer wants the L/C to be transferable, advisable, he should ensure those
stipulations are specially mentioned in the L/C
At last the exporter submits all these documents along with a Letter Of indemnity to
Motijheel Main Branch for negotiation. The officer scrutinizes all the documents. If the
documents are correct one, the branch purchases the documents on the basis of banker
customer relationship. This is known as Foreign Documents Bill Purchase (FDBP).
Export Financing (Back-To-Back L/C)

The bank finances the exporter through Back-to-Back L/C. In case of Back-to-Back L/C, a
new L/C (import L/C) is opened against the original L/C (export L/C). Under the Back-to-
Back concept, the seller as the beneficiary of the first L/C offers it as a security to the advising
bank for the issuance of the second L/C. The beneficiary of the back-back L/C may be located
inside or outside the original beneficiarys country. In case of a back-to-back L/C, no margin is
taken by the bank. The bank liens the first L/C. In case of back-to-back L/C, the usage bill is
usage/time bill. For back-to-back L/C the NCCBL act as a negotiating bank. The NCCBL
39
finances the BTB L/C applicant total 85% among which 75% for L/C and 10% for packing
credit. The above may be sanctioned as on the managers (SEVP) discretionary.
In Motijheel main Branch of NCCBL, papers and documents required for opening of BTB L/C
are follows:
Mother L/C
IRC &ERC
L/C application and LCAF duly filled and signed
proforma invoice/ indent
Insurance cover note with money receipt
IMP form duly signed
In addition to the above documents the following documents are also required for garments
sector:
Textile permission
Valid bonded warehouse license
The maturity period may be for 30/60/90/120/180.Deffered payment is made. Payment is given
after realizing export proceeds from the L/C issuing bank. For garments sector the duration can
be maximum180 days. For importing machinery, without permission from Bangladesh bank,
Motijheel main Branch can authorize for180 days. In such cases SEVP, the manager used to
exercise his discretionary power.
Some common discrepancies in Export Documents
Late shipment
Part shipment effected
Consignee/Notify part differs
F.C.R presented instead of B/L
Late presentation
B/L shows freight collect instead of freight prepaid
Shipped on Broad not marked on the B/L
Description of the goods differs
Unit price differs
Amount overdrawn
Telex acknowledging receipt and giving acceptance on sample, not presented etc
Per shipment inspection certificate absent
Not showing inspection of the goods at named place
Certificate not signed by authorized person.
Reporting To Bangladesh Bank

At the end of every month, reporting to Bangladesh Bank regarding the following information is
mandatory:
40
Entire months amount of import, category of goods, currency, country etc
Information of all charges and commission with T/M form. Disposal of IMP form that
includes... a) original IMP is forwarded to Bangladesh Bank with invoice and indent, b)
duplicate IMP is kept with the branch along with the Bill of Entry /Certified invoice, C)
triplicate IMP is kept with the branch for office record, d) quadruplicate IMP is kept for
submission to Bangladesh Bank incase of imports where documents are retired.
6.6 Collection Section

The bank collects and purchases the documentary bills for settlement of the credit. The
documentary bills are:
FDBP (Foreign Documentary Bills Purchase)

FDBC (Foreign Documentary Bills for Collection)
LDBP (Local Bills Purchase)
FDBP
For FDBP following accounting treatments are maintained:
Adjustment before realization of the proceeds,
FDBP A/CDr.
Liabilities A/CCr.
Charges A/CCr.
Exporters A/C Cr.
Adjustment after realization of the proceeds,
SBG A/C (Head Office-ID)Dr.
FDBP A/C Cr.
Charges A/CCr.
Exporters A/C Cr.
An FDBP registered is maintained for recording all the particulars.
FDBC
Motijheel Main Branch forwards the documents for collection due to the following:
If the documents have discrepancies

41
If the exporter is a new client
if the banker is doubt
The following accounting treatments are maintained:
Head Office A/C Dr.@T.T. Clean
Partys A/CCr. @ O.D.Sight
FDBC A/C Cr.
Postage A/C Cr.
Exchange EarningCr.
An FDBC register is maintained for recording the particulars.
LDBP
The following accounting treatments are maintained for purchasing the local bills:
LDBP A/CDr.
Partys A/CCr.
Commission A/CCr.
Interest A/CCr.
For LDBP with in the maturity period interest is collected at 16% and beyond the maturity period
interest would be at 18%. An LDBP Register is maintained to record the acceptance of the
Issuing Bank. Until the acceptance is obtained, the record is kept in a Collection Register.
Modes Of Payment Of Documentary Bills
The methods of payment under L/C are as follows:
At sight payment credit: The bank pays the stipulated sum immediately against the
exporters presentation of the documents.
Deferred Payment Credit: Indeferred payment credit, the bank agrees to pay on a
specified future date or even, after presentation of the export documents. No bill of
exchange is involved.
Negotiation credit : In negotiation credit, the exporter has to present a bill of exchange
payable to him and in addition to other documents that the bank negotiates.
Acceptance Credit: In acceptance credit the exporter presents a bill of exchange payable
to him and drawn at theagreed tenor on the bank that is to accept it. The bank signs its
acceptance on the bill and returns it to the exporter. The exporter can then represent it for
payment on maturity. Alternatively he can discount it in order to obtain immediate
payment.
42
CHAPTER 7: FINANCIAL PERFORMANCE OF NCCBL
7.1 Financial Performance of NCCBL

During the year 2012 the performance of the bank was satisfactory as reflected in the key
indicators like Operational Profit, Deposits and Loans &Advance etc. The total Deposits, Loans
& Advances and profit of the Bank at the end of the year, 2012 stood at Tk. 96,918.22 million,
Tk. 79,948.22 million and Tk. 2,742.75 million respectively.
Operational Profit 2008 - 2012

5000
4000
3000
2000 4100 4214 4026

3137
1000 2363
0
2008 2009 2010 2011 2012
7.2 Authorized Capital, Paid up capital, reserve fund & other Reserves
The authorized capital of the bank at 10,000 million as on 31.12.2012 while paid-up capital
raised to Tk. 6,951.74 million from Tk. 5,941 million on 20122. The reserve fund and other
reservces increased to Tk. 7766.13 million recording 8.38% increase over last years figure of
7165.83 million
43
Paidup Capital 2008 -2012
8000
6000
4000
6951
5941
2000 4501
1757 2284
0
2008 2009 2010 2011 2012
Total Capital
15000
10000
11825 12777
5000 10033
6322
4440
0
2008 2009 2010 2011 2012
7.3 Deposits
Deposits of the bank as on 31.12.2012 stood at Tk. 96,918.22 million which reflects a 19.46%
growth over the previous years figure of 81,127.17 million. Deposit mix is shown in the chart
below
Deposit (2008 - 2012) Figure (In Million)

120,000.00
100,000.00
80,000.00
60,000.00
96,918.22
40,000.00 67,961.24 81,127.17
46,905.66 53,900.15
20,000.00
0.00
2008 2009 2010 2011 2012
7.4 Investment
44
As on 31.12.2012 banks total figure of investment was 30,851.74 million, reflecting 48.04%
growth over the previous years figure of Tk. 20,840.29 million. Among others investment in
Government Treasury Bond helps maintaining liquidity requirements in one hand and yielding
good profit on the other. Besides Banks primary Dealership in treasury Bills also help to deal in
the money market effectively.
Investment (2008 - 2012) Figure (In Million)

40000
30000
20000
30852
10000 20840
9672 10981
5527
0
2008 2009 2010 2011 2012
7.5 Foreign Exchange Business:

Foreign exchange business is one of main sources of banks earnings: as such intensive care is
taken to boost up the business in every possible way. With careful and prudent handling of
banking needs of the exports and imports by assigning experienced officers, the bank achieved
good result during the year 2012.
During the year review, the bank handled export and import business to the tune of Tk. 13,346.66
million and Tk. 45,8283.46 million respectively. Banks number of AD License Branches was 22
in 2012. However, NCC bank Ltd. Trying to obtain AD license for some other branches in 2012
from Bangladesh Bank.
45
60000
50000
40000
Import
30000
55044.49 Export
45283.46 Series 3
20000 38796.88 41245.21
33078.44
10000 20981
16125.52
12522.04 11903.72 13346.66
0 2 2 3 5
2008 2009 2010 2011 2012
7.6 Remittance Business

To ensure smooth remittance service to the beneficiaries, the banks efforts in 2012 was further
intensified. In 2012, Total remittance received by the bank was more than BDT 21705.95 million
registering 34.99% increase over previous years BDT 16079.26 million.
Investment (2008 - 2012) Figure (In Million)

25000
20000
15000
10000 21705
13392 16079
5000 12098 12505
0
2008 2009 2010 2011 2012
46
CHAPTER 8: SWOT ANALYSIS OF NCCBL
SWOT ANALYSIS
A companys present situation can be determined through the SWOT Analysis which indicates
Strengths, Weakness, Opportunity and Threat. This has been
Strength Weakness
1. Efficient Administration 1. Manual record keeping is still around

2. Healthy Financial vitals 2. Inadequate number of needed workforce in
some branches
3. 200 crore profit in the year 2011
3. Noticeable reluctance to arranging
4. Strong position in CAMEL rating marketing campaign and promotion
5. Using SWIFT Technology & FLORA
Software
6. Good client- banker relationship
7. High level of cooperation and cohesion
among branches
Opportunity Threats
1. Huge potential of growth in sectors like 1. A very recent prolonged massive crash in
online banking & ATM card secondary market has created new challenges
for the managers
2. Currently introduced SMS banking
2. Financially powerful foreign banks with
3. A steady GDP growth & other sectors means strong brand names would became the choice
opportunities are always there for carefully of big parties
designed, attractive services
3. 9 more banks are about to established,
4. A country with a population of 160M comes number of competitors will increased
with financial demands, where banks may
significantly contribute with mutual benefits.
47
8.1 Strengths
Efficient Administration:
NCC Bank maintains transparency in its entire works. All decision of the Management comes
through discussions in appropriate forum and required follow-ups are also made to see their
effectiveness.
Healthy Financial vitals:

Due to declined flow of remittance in the first leg of the year 2011 owing to political turmoil or
transition of power in some Middle Eastern countries there were some difficulties in running the
affairs of the banks. Private Banks faced some difficulties in respect of sanctioning fresh loan
and soaring exchange rate against US Dollar slowed down import of capital machineries as well
as caused increase in inflationary rates. Due to strengthening NCC Banks position they have
taken a new approach of centralizing opening of letter of credit administration brought discipline
in documentation of loan before disbursement. It will also help secure quality of the assets and
lower quantum of NPL in the coming days.
Strong position in CAMEL rating:

The Capital, Asset, Management, Earning, Liquidity and Sensitivity (CAMELS) rating of
different commercial banks in 2008 were done recently by the regulatory authority. The serial is
made on the basis of performance of 2007 and local banks first, then foreign banks. Based on
CAMEL Rating NCC Banks performance is satisfactory.
SWIFT Technology & FLORA Software:

Swift Technologies services are designed to generate increased efficiency and business value in
key functional areas such as finance, human resources, information technology, supply chain
management, and CRM. And FLORA is a logic-based object-oriented language for building
knowledge-intensive applications. It is based on F-logic, HiLog, and Transaction Logic.
Applications include intelligent agents, Semantic Web, ontology management, and more. NCC
Bank IT is headed by Mr. Tapan Kanti Sarkar, Executive Vice President & CTO and teamed
with 45 dedicated IT personnel who work round the clock with a view to provide support in core
banking Flora UBS software operations along with System, Hardware & Network maintenance
support to its 80 Branches & 3 SME branches and Head Office including Chittagong Area office.
48
Good client- banker relationship:
NCC Bank has a dedicated work force they take their prime objective is to satisfy the needs of
the customers. They are trying to reach a vast section of people to include them in the formal
banking circle. Their network is expanding in that direction of course.
High level of cooperation and cohesion among branches:

NCC Bank has a very good interpersonal relationship among all the Branches.
8.2 Weaknesses
Manual record keeping:
Manual record keeping are still around NCC Bank. The chance of losing instrument and
documents can get ruined for many unusual circumstances.
Inadequate number of needed workforce in some branches:

In Dhanmondi Branch more than 10 employees have been transferred to other branches in 1 year.
So the workforce in Dhanmondi Branch became inadequate. Sometimes its really tough for
them to manage the streams of clients.
Noticeable reluctance to arranging marketing campaign and promotion:

NCC Bank is not that much efficient in marketing campaign and promoting their products.
8.3 Opportunities
Huge potential of growth in sectors like online banking & ATM card:
Now a days everyone leads a very busy life. Online banking is a very good solution. People
dont have to go through a long traffic jam to deposit money in their account. People also fear to
carry cash. Online banking and ATM Card has long term opportunity in Bangladesh.
Currently introduced SMS banking:

NCC Bank just introduced SMS Banking. The clients can now check their balance through SMS.
49
A steady GDP growth & other sectors means opportunities are always there for carefully
designed, attractive services:
Steady GDP Growth rate in banking sectors shows opportunity in for banking sectors in
Bangladesh.
Financial Demands:
The current population of Bangladesh is now 16 Million. Financial needs are also increasing as
the population is increasing. So the financial institute like banks will have a huge demand.
8.4 Threats
Massive crash in secondary market:
The recent prolonged crash in secondary market has created many new challenges for managers.
Financially powerful foreign banks with strong brand names would became the choice of
big parties :
There are many foreign banks are now in Bangladesh with a very strong brand name. big parties
can go to those banks rather than the Bangladeshi bank.
New Banks:
Nine new banks will establish in Bangladesh by October2012. Competition will become tougher
then.
50
CHAPTER 9: FINDINGS & RECOMMENDATION
9.10 Findings
During my internship in Bandorbazar Branch of NCC bank, I have experienced various

things in General banking section. Based on my personal observation I have cited
below some findings which can be improved or taken care of:
There is no specific desk for customer service (helping desk) and designated
customer relationship officer in this branch. As a result, the personnel are
unable to provide prompt customer service.
The customers do not have any option to put their complaint in a specific
complain Box.
51
The employees are not sufficient in this section.
The bank does not put much emphasis as well as they are not very concern on
marketing of their products.
There is a space for the customers to wait but in rush hour it seems inadequate
and clumsy.
There are some products which are not exercised properly by the officials.
Lack of updated products is also a demerit of the general banking. The bank
provides only some limited traditional services.
9.2 Recommendation
The current condition of NCC Bank is good enough. The clients are satisfied with the service. To
hold their current client and to attract new clients NCC Bank needs improvement in some
factors. As per earnest observation some suggestions for the improvement of the situation are
given bellow:
They should update their website.

There is a noticeable absence of the bank from mainstream media, with hardly any well-
planned promotional activities.
There should be more ATM Booths.
NCCBL must pursue a strong an effective recruitment system so that right people are
recruited at the right job. It is worth spending more on attractive qualified human
resources rather than recruiting staffs by reference.
Online banking should be updated to attract more clients.
Should give more concentration on decoration part of the branch, and take initiatives to
maintain the line in cash counter. They can provide token to each client to maintain the
line.
Number of branches is very limited of this bank. They have to increase the number of
branches at various key points of the country.
Long term training very much required for the bank officials
52
Effective and efficient initiatives are necessary to recover the defaults loans.
To attract more clients NCCBL has to create a new marketing strategy, which will
increase the total export import business.
Foreign exchange operations of other banks are more dynamic and less time consuming.
CHAPTER 10: CONCLUSION
Conclusion
Though NCC Bank Ltd faced lots of challenges from different competitors still they succeeded to hold its
image and achieved a sustainable growth. NCCBL did several CSR activities started from urban to rural
areas.NCC bank has gained acceptance for its CSR activities as a voluntary efforts in promoting equitable
and sustainable development of the society Further, the Bank should pay attention to manage liability also
so as to build up a strong deposit base to satisfy investment need of the market. NCCBL has been
awarded various trophies from exchange companies like Moneygram for its initiatives in motivating
people in this part of the World to avail of the opportunity of sending money through these enterprises.
The Bank maintains transparency in its entire works. All decision of the Management comes through
discussions in appropriate forum and required follow-ups are also made to see their effectiveness. To train
up the fresh appointees, the Bank undertakes various training programmers in its Training Institute.
Further, training are arranged for making other officers acquainted with changing atmosphere of the
53
sector so as to enable them to be on the race. The Bank is always concerned to keep up its good image
through various promotional measures.
BIBLIOGRAPHY
1. http://en.wikipedia.org/wiki/List_of_banks_in_Bangladesh -27-02-2012
2. http://en.wikipedia.org/wiki/Bank#History- 27-02-2012
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4. http://www.nccbank.com.bd/index.php/nccbproducts -04-03-2012
5. http://www.nccbank.com.bd/indesix.php/nccbproducts#depot 06-03-2012
6. http://www.nccbank.com.bd/index.php/mission - 13.03.1012
7. Annual Report 2010, 2011, 2012
8. http://www.oppapers.com/essays/BankIng-Scenario-In-Bangladesh/533678- 15-03-2012
9. http://www.reportbd.com/articles/29/1/Banking-Sector-in-Bangladesh/Page1.html -15-03-2012
10. http://www.answers.com/topic/payment-order#ixzz1rZEJ9aur- 18-03-12

11. http://www.aims-bangladesh.com/special/BankingSector.pdf- 19-03-12
54
12. http://wiki.answers.com/Q/What_did_people_do_before_banks_appear- 19-03-12
13. http://en.wikipedia.org/wiki/Product_(business)- 21-03-12
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15. http://en.wikipedia.org/wiki/Product_(business)- 21-03-12

16. http://www.channelone.com/pdf/2009/bank_products.pdf- 22-03-12
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18. http://bankinfobd.com/- 26-03-12
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An Internship Report on

Banking Practice in Bangladesh: A NCC Bank View

NCC BANK LIMITED

BBA Program, Leading University, Sylhet

BBA Program, Leading University

Subject: Submission of Internship Report.

Tuha Hamid Ima

BBA Program, Leading University, Sylhet

ABOUT THE REPORT

CHAPTER 2 CONTENT PAGE NO

CHAPTER 3 CONTENT PAGE NO

BANKING PRACTICES OF NCC BL (GENERAL BANKING)

CHAPTER 4 CONTENT PAGE NO

BANKING PRACTICES OF NCC BL (CREDIT)

CHAPTER 5 CONTENT PAGE NO

BANKING PRACTICES OF NCCBL (FOREIGN EXCHANGE)

CHAPTER 6 CONTENT PAGE NO

FINANCIAL PERFORMANCE OF NCCBL

CHAPTER 8 CONTENT PAGE NO

FINDINGS & RECOMMENDATION

CHAPTER 9 CONTENT PAGE NO

CHAPTER 10 CONTENT PAGE NO

1.1 Objective of the Report

To know the work environment and organizational behaviors of the bank

To fulfill the requirement of the internship program under BBA program.

1.2 Methodology of the Report

Secondary Sources of data

1.3 Limitations of the Report

1.4 Scope of the Study

2.2 Current Banking Scenario in Bangladesh

1. Nationalized Commercial Banks

3.1 Background of NCC Bank

3.4 Positioning Statement

3.6.1 Human Resource Development (HRD)

3.6.2 Software Training

Flora Banking Software (Head Office and Branch Level)

Real Time Problem Solution

3.6.3 Network Training

Branch Network Support

3.6.4 Hardware Training

Basic Hardware Setup Training

3.6.5 Card Division Training

All Visa Related Training

International Visa Compliance

Internal Credit Card Marketing

3.7 Human Resource Management

3.8 Management Information System (MIS)

Amjadul Ferdous S.M. Abu Mohsin Abdus Salam

Mrs. Sohela Hossain Yakub Ali Md. Abul Bashar

Md. Harunur Rashid Khairul Alam Chaklader Md. Moinuddin

3.10Structure of the Bandorbazar Branch

Structure of Kumarpara Branch, Sylhet

Loan & Advance Foreign Exchange General Banking

Account opening Cash Bill & Clearing Remittance

Figure: Structure of the Bandorbazar Branch, Sylhet

Public issues; 35.58; 36%

Foreign Investors; 0.24; 0%

Chart: Percentage of Shareholdings of NCCBL.

3.12 Branch Network

Nature of the job

General Banking Department

Accounts and Credit Department

Foreign Exchange Department