Body of The Report 3

Foreign Trade Finance of Dhaka Bank Limited
CHAPTER-1
Introduction Part
Page 1 of 80
1.1. Background of the Study:
Bangladesh economy has been experiencing a rapid growth since the '90s. Industrial and
agricultural development, international trade, inflow of expatriate Bangladeshi workers'
remittance, local and foreign investments in construction, communication, power, food
processing and service enterprises ushered in an era of economic activities. Urbanization and
lifestyle changes concurrent with the economic development created a demand for banking
products and services to support the new initiatives as well as to channelize consumer
investments in a profitable manner. A group of highly acclaimed businessmen of the country
grouped together to respond to these needs and established Dhaka Bank Limited in the year
1995.
The Bank was incorporated as a public limited company under the Companies Act. 1994. The
Bank started its commercial operation on July 05, 1995 with an authorized capital of Tk. 1,000
million and paid up capital of Tk. 100 million. The paid up capital of the Bank stood at Tk
2,659,597,763 as on March 31, 2010. The total equity (capital and reserves) of the Bank as on
March 31, 2010 stood at taka 6,036,368,754. The Bank has 54 Branches, 4 SME Service Centers,
5 CMS Units, 2 offshore Banking Unit across the country and a wide network of correspondents
all over the world. The Bank has plans to open more Branches in the current fiscal year to
expand the network.
The Bank offers the full range of banking and investment services for personal and corporate
customers, backed by the state–of–the-art technology and a team of highly motivated
Professionals.
Page 2 of 80
As an integral part of our commitment to Excellence in Banking, Dhaka Bank now offers the full
range of real-time online banking services through its all Branches, ATMs and Internet Banking
Channels.
Dhaka Bank Ltd. is the preferred choice in banking for friendly and personalized services,
cutting edge technology, tailored solutions for business needs, global reach in trade and
commerce and high yield on investments.
1.2 Rationale of the study:
Banking sector is one of the strongest sectors in our country. Banks provide necessary funds for
executing various programs underway in the process of economic development. They collect
savings of large masses of people scattered throughout the country, which in the absence of
banks would have remained idle and unproductive. These scattered amounts are collected,
pooled together and made available to commerce and industry for meeting the requirements.
Economy of Bangladesh is in the group of world’s most undeveloped economies.
One of the reasons may be its undeveloped banking system. Government as well as different
international organizations have also identified that undeveloped banking system causes some
obstacles to the process of economic development. So, one country must be efficient in banking
if it wants to be developed. My study on the bank has created an edge on my professional
learning. In today’s globalised world, one of the most important banking activities is foreign
trade. So, the importance of my study on “Foreign Trade Finance of Dhaka Bank LTD” is
beyond description.
Page 3 of 80
1.3 Research Objectives:

My primary objective behind this report is to get acquainted with the different issues of foreign
trade. Without the specific objectives, any study cannot become the fruitful one. Before
preparing the report, I would like to set up objective of my study as:
1.3.1 Primary Objective:

 To get acquainted with the different issues of foreign trade.
1.3.2 Specific Objectives:

 To understand the overall procedure of export & import to familiarize with the issues of
international trade.
 To understand & identify the functions of Foreign Trade in DBL.
 To understand the legal formalities required in foreign trade.
 To understand the importance of foreign trade.
Scope & Limitations of the study:

The main objectives of my short time practical learning were basically to get introduced with
related laws, principles, documentations, procedures & practical knowledge regarding Export &
Import business of Bangladesh. Since it was a very short period of time, I wasn’t able to collect
more data to acquire deep understanding.
Page 4 of 80
Since this topic is related to export import policy order, guidelines issued by Bangladesh bank &
practical information based on DBL, it wasn’t easy to collect all the data within the short of time.
There are some specific limitations that I faced while doing my internship. These are as follows:
 The data and information related with the topic was not easily available.
 Supply of more practical and up to date data was another shortcoming.
 The study was not done very successfully due to inexperience.
 There are many other factors that can influence customers loyalty but the researcher
could not include them in the study because of the duration of report writing.
 Another limitation of this report was Bank’s policy of not disclosing some data and
information for obvious reasons, which could have been very useful.
 Most recent annual information was not available due to time limitations.
1.4 Information needs:
In order to conduct this research project and fulfill the research objectives the following
information will be required:
 Need some working papers, which are related with the subject matter of the report.
 To prepare my internship report, I have discussed with many employees who are related
to Trade Finance department.
 I have to collect latest annual report of DBL.
 Information about the expectation of the customers, which will fulfill their demand
and needs.
Page 5 of 80
CHAPTER-2
Organization
Overview
Page 6 of 80
2.0 Organizational Part
2.1 Historical Perspective
Dhaka Bank Limited (DBL) is the leading Private Sector Bank in Bangladesh offering full range
of Personal, Corporate, International Trade, Foreign Exchange, Lease Finance and Capital
Market Services. Dhaka Bank Limited is the preferred choice in Banking for Friendly and
Personalized Services, cutting edge Technology, tailored solutions for Business needs, Global
reach in Trade and Commerce and high yield on Investments, assuring Excellence in Banking
Services.
DBL is a Scheduled Bank that was incorporated as a public limited company on April 06, 1995
under the Companies Act, 1994. The Bank started its commercial operation as a Private Sector
Bank on July 05, 1995 with a target to play the vital role on the socio-economic development of
the country. Aiming at offering Commercial Banking Service to the Customers’ door around the
country, the DBL established 22 branches up-to this year. This organization achieved Customers’
confidence immediately after its establishment.
Within this short time the bank has been successful in positioning itself as progressive and
dynamic financial institution in the country. This is now widely acclaimed by the business
community, from small entrepreneur to big merchant and conglomerates, including top rated
corporate and foreign investors, for modern and innovative ideas and financial solution.
Page 7 of 80
The Authorized Capital of the DBL was Tk.1,000 Million and Paid up Capital of Tk.100 million.
The Paid up Capital of the Bank stood at Tk.531.07 Million as on 31 December, 2003. The Total
Equity (Capital and Reserves) of the Bank as on 31 December, 2003 stood at Tk. 1,209.97
Million. The Capital Adequacy Ratio is 10.88% as on December 31, 2003, which exceed the
Stipulated Requirements for the Banks in Bangladesh.
2.2 Mission & Vision
The Mission of the Dhaka DBL is to be the Premier Financial Institution in the country providing
High Quality Products and Services backed by Latest Technology and a Team of Highly
Motivated Personnel to deliver Excellence in Banking.
“The stars in the seven skies sparkle in brilliance and twinkle in blissful beauty. We wonder at
them in profound admiration and speculation.
At Dhaka Bank we draw our inspiration from the distant stars. Our team is committed to assure a
standard that makes every banking transaction a pleasurable experience. Our endeavor is to offer
you the razor sharp sparkle through accuracy, reliability, timely delivery, cutting edge
technology, tailored solutions for business needs, global reach in trade and commerce and high
yield on your investments.
Page 8 of 80
Our people, products and processes are aligned to meet the demand of our discerning customer.
Our goal is to achieve a distinction like the luminaries in the skies. Our prime objective is to
deliver a quality that demonstrates a true reflection of our vision - Excellence in Banking.”
The Vision of the DBL is to be one of the top three Private Commercial Banks in Bangladesh by
the year 2012.
2.3 Goals of the Bank
 Long-term Goal:
To be the Market Leader both in terms of Deposits and good advances among Private
Commercial Banks in Bangladesh by the year 2015.
 Short-term Goal:
To increase Current Market Shares at least 0.35% by 20011.
 Financial Goal:
To reduce the existing Cost of Fund by 1%, this currently stands at 11.06%
 Other Goals:
 To be one of the best Banks of Bangladesh.
 To achieve Excellence in Customer Service next to none and superior to

all competitors.
 To cater to all differentiated segments of Retail and Wholesale Customers.
 To be a High Quality Distributor of Product and Services.
Page 9 of 80
 To use state of the Art Technology in all spheres of Banking.
2.4 Values
 Customer Focus
 Integrity
 Team Work
 Respect for Individual
 Quality
 Responsible Citizenship
2.5 Workforce
DBL recognizes that a productive and motivated Work Force is a prerequisite to leadership with
its Customers, its Shareholders and in the Market it serves. DBL treats every Employee with
dignity and respect in a supportive environment of trust and openness where people of different
backgrounds can reach their full potential.
The Bank’s Human Resources Policy emphasize on providing Job Satisfaction, Growth
Opportunities, and due recognition of superior performance. A good working environment
reflects and promotes a high level of loyalty and commitment from the employees. Realizing this
DBL has placed the utmost importance on continuous development of its Human Resources,
identify the strength and weakness of the employee to assess the individual training needs, they
are sent for training for self-development. To orient, enhance the Banking knowledge of the
employees Dhaka Bank Training Institute (DBTI) organizes both in-house and external training.
Page 10 of 80
2.6 Management System
Since its journey as Commercial Bank in 1995 DBL has been laying great emphasis on the use of
improved Technology. It has gone to Online Operation System since 2003. And the new Banking
Software FLEXCUBE is newly installed. As a result the Bank will able to give the services of
international standards.
2.7 Correspondent Relationship
The Bank established correspondent relationships with a number of Foreign Banks, namely
American Express Bank, Bank of Tokyo, Standard Chartered Bank, Mashreq Bank, Hong Kong
Shanghai Banking Corporation, CITI Bank NA-New York and AB Bank Ltd. The Bank is
maintaining Foreign Exchange Accounts in New York, Tokyo, Calcutta, and London. The Bank
has set up Letter of Credit on behalf of its valued Customers using its Correspondents as advising
and reimbursing Banks. The Bank maintains a need based Correspondent Relationship Policy,
which is gradually expanding. The number of Foreign Correspondents is now 406.
2.8 Departments of DBL
If the Jobs are not organized considering their interrelationship and are not allocated in a
Particular Department it would be very difficult to control the system effectively. If the
departments are not fitted for the Particular Works there would be Haphazard Situation and the
Performance of a Particular Department would not be measured. DBL has does this work very
well. Different Departments of DBL are as follows:
Page 11 of 80
 Human Resources Division
 Personal Banking Division
 Treasury Division
 Operations Division
 Computer and Information Technology Division
 Credit Division
 Finance & Accounts Division
 Financial Institution Division
 Audit & Risk Management Division
2.9 Existing Branches:
Dhaka Bank limited has 20 conventional Branches and 2 Islamic Banking Branches. Among
total of 22 Branches, 14 Branches are located in Dhaka City, 4 Branches are located in
Chittagong. The other 4 Branches are located in Sylhet, Narsingdi, Narayangonj, Sirajgonj each.
The registered office (Head Office) of Dhaka Bank Limited is at Biman Bhavan, 100 Motijheel
C/A, Dhaka-1000. The exiting Branches are:
1. Local Office: Adamjee Court (G.Floor),

115-120, Motijheel C/A, Dhaka
2. Foreign Exchange Branch: Biman Bhaban,
100, Motijheel C/A, (1st floor) Dhaka
3. Banani Branch: 73/B, Kemal Ataturk Avenue, Banani, Dhaka.
4. Uttara Branch: House 95A, Road 7, Sector 4, Uttara, Dhaka.
5. Dhanmondi Branch: House: 7, Road: 4, Momtaz Plaza,
Page 12 of 80
Dhanmondi R/A, Dhaka.

6. Karwan Bazar Branch: Summit Centre (1st floor),
18, Karwan Bazar, Dhaka.
7. Bangshal Branch: 2, Bangshal Lane, North South Road, Dhaka.
8. Imamganj Branch: 1, Imamganj Lane, Imamganj Bazar, Dhaka.
9. Islampur Branch: 6-7, Islampur Road, Islampur, Dhaka.
10. Narayangonj Branch: 26-29, S.M. Maleh Road,
Tanbazar, Narayangonj.
11. Amin Bazar Branch: Amin Bazar, Savar, Dhaka.
12. EPZ Branch: Zone Service Building, Room 51,
DEPZ, Savar, Dhaka.
13. Fantasy Kingdom Branch: Fantasy Kingdom, Ashulia, Savar, Dhaka.
14. Islamic Banking Branch: Sara Tower, 11/A, Toyenbee Circular Road,
Motijheel C/A, Dhaka-1000.
15. Jubilee Road Branch: 183, Jubilee Road, Chittagong.
16. Agrabad Branch: Chamber House, 38, Agrabad C/A, Chittagong.
17. Khatunganj Branch: 292-293, Khatunganj Road,
Khatunganj, Chittagong.
18. Laldighirpar Branch: 960, Laldighirpar, P.S. Kotwali, Sylhet.
19. Madabdhi Bazar Branch: 8, Bank Road, Madabdhi Bazar, Noushingdi.
20. Belkuchi Branch: Mukundaganti, Belkuchi, Sirajganj.
21. Gulshan Branch: Gulshan-1, Dhaka.
Page 13 of 80
2.10 Organization Structure
Board of Directors
Managing Director
Deputy Managing Deputy Managing Director

Director (Operations) (Credit & risk management)
SVP,
EVP, F&AD Operations SVP, Financial VP, Personal FAVP,
Division institution Banking Division HRD
Division
Senior Vice Vice President SVP, Audit & Senior

VP
President Risk Assistant Vice
Management President
FAVP
Vice Ass. Vice First Assistant

President President Vice President
I m working under this

Assistant Vice
President
Figure-1: Organization Chart of Dhaka Bank Limited
Page 14 of 80
2.11 Growth of the Bank

DBL is one of the most successful Private Sector Commercial Bank in our country, though it
started its operation only nine years back. It has achieved the trust of the general people and
made reasonable contribution to the Economy of the country by helping the people investing
allowing Credit Facility.
2.11.1 Capital & Reserve
Dhaka Bank Limited (DBL) commenced its operation with an Authorized Capital of Tk.1000.00
Million with Paid up Capital of Tk.100.00 Million.
The Paid up Capital of the Bank amounted to 531.07 (531) Million as on December 31, 2009 as
against Tk.379.34 (379) Million of the previous year (2008).
Paid up Capital of DBL Taka in Million
Year Paid up Capital

2008 379
2009 531
1400
1200
1000
800 2009
2008
600
400
200
0
2008 2009
Page 15 of 80
The Total Equity (Capital & Reserve) of the Bank as on December 31, 2009 stood at Tk.1209.97
(1,210) Million as against Tk.895.45 (895) Million of the previous year (2008). The Capital
Adequacy Ratio is 10.88% as on December 31, 2009, which exceed the stipulated requirements
for Banks in Bangladesh.
Capital & Reserve of DBL Taka in Million
Year Capital & Reserve

2008 895
2009 1210
1400
1200
1000
800 2009
600 2008
400
200
0
2008 2009
2.11.2 Profit
Dhaka Bank Limited (DBL) registered an Operating Profit of Tk.509.60 (510) Million as on
December 31, 2009. Provision for Tax for the year amounted to Tk.240.61 Million with a Net
Profit of Tk.268.99 Million. Where as it was Tk.429.78 (430) Million in the previous year
(2008).
Page 16 of 80
Profit of DBL Taka in Million
Year Profit
2008 430
2009 510
600
500
400
2009
300
2008
200
100
0
2008 2009
2.11.3 Deposits
As on December 31, 2009 the Total Deposits of the Bank stood at Tk.16850.83 (16851)
Million excluding call as against Tk.14964.01 (14964) Million excluding call of the
previous year.
Deposits
of DBL
18000
Taka in 16000
Million 14000
12000
2009
10000 Year Deposits 2008
8000 2008 14964
6000 2009 16851
4000
2000
0
2008 2009
Page 17 of 80
2.11.4 Loan and Advances
The Bank recorded a 14.94% growth in Advances with a Total Loans and Advances
Portfolio of Tk.12886.68 Million at the end of December 2009 compared to Tk.11211.39
Million in 2008.
Dhaka Bank is making Loan and Advances in different areas. The Bank continues to
explore and diversify its loan distribution with the objective of efficient use of resources
and take utmost precaution to safeguard it. DBL also participated in a Syndicated Loan.
Loans & Advances of DBL Taka in Million
Year Loans & Advances

2008 11210
14000
2009 12880
12000
10000
8000 2009
6000 2008
4000
2000
0
2008 2009
Page 18 of 80
2.11.5 International Trade
International Trade is an important constituent of the business portfolio of the bank. The import
value stood at Tk.19079.40 (19079) million in 2009 with a growth of 2.05% over the volume of
18696.70 (18697) million in 2008. On the other hand, export increased by 12.90% in the year
2009. Total export volume of the bank amounted to 6900.60 (6901) million in 2009 compared to
Tk.6110.20 (6110) million in the previous year.
Import of DBL Taka in Million
Year Import
2008 18697
2009 19097
20000
18000
16000
14000
12000 2009
10000
2008
8000
6000
4000
2000
0
2008 2009
Page 19 of 80
Export of DBL Taka in Million
Year Export
2008 6110
2009 6901
7000
6000
5000
4000 2009
3000 2008
2000
1000
0
2008 2009
2.11.6 Investment Banking:
Lease finance, Hire purchase and Capital Market Operation besides investment in Treasury Bills
and Prize Bonds constitute the investment basket of DBL. The investment portfolio made up of
Government Securities and Shares and Debentures of different listed companies stood at
Page 20 of 80
Tk.2046.10 (2046) Million in 2009 indexing a 4.91% increase over Tk.1950.28 (1950) Million in
the previous year.
Investment Banking of DBL Taka in Million
Year Investment Banking

2008 1950
2009 2046
2500
2000
1500 2009
2008
1000
500
0
2008 2009
2.12 Current Performance
DBL is committed to deliver better service to our valuable customers. Customers are our first
priority and driving force. Superior quality customer service through the integration of the latest
state-of- the-art technology is our motto. Our customers come from all walks of life. They are
Page 21 of 80
professional, businessmen, public servants, entrepreneurs, homemakers, men & women,
residents and non-residents maintaining local & foreign currency accounts. Introducing new
products and developing the quality of the existing products are the strategies adopted by the
Bank to serve the customers. We are always committed to sustain the commitment "Excellence
in Banking".
We are aware of natural consequences of globalization, liberalization, privatization, reforms,
foreign investment, economic policy and infrastructure development. We have long-term
sustainable relationship with strong bondage of caring and sharing with our customers.
2.13 Objectives of the Bank:
1. Our objectives are to conduct transparent and high quality business operation based on
market mechanism within the legal and social framework spelt in our mission and
reflected in our vision.
2. Our greatest concerns are our customers to provide them continually efficient, innovative
and high quality products with excellent delivery system.
3. Our motto is to generate profit with qualitative business as a sustainable ever-growing
organization and enhance air returns to our shareholders.
4. We are committed to our community as a corporate citizen and contributing towards the
progress of the nation as our corporate social responsibility.
5. Our employees are our backbone. We promote their well being through attractive
compensation package, promoting staff morale through training, development and career
planning.
Page 22 of 80
6. We strive for fulfillment of our responsibility to the government through paying entire
range of taxes and duties and abiding the other rules.
7. We are cautious about environment & climatic change and dutiful to make our homeland
a green and clean soil.
2.14 Policies and Strategies of the bank
1. DBL seeks to build long-term, sustainable beneficial relationships with all its customers
based on the service- commitments and on underlying values of mutual respect.
2. The primary concern of DBL is to understand and satisfy customers' needs and
expectations. DBL promises to use all means open to them to establish and understand
these needs, which are both mutually beneficial and respectful to their values and
principles.
3. DBL promises to deal quickly, courteously and accurately with all correspondences.
4. Should disagreements arise between DBL and its clients, DBL undertakes speedy and
equitable solutions, which takes into account rights and obligations, of both parties and is
framed in the context of a long- term and enduring relationship.
5. DBL believes in openness, integrity, transparency and accountability and provides high
standard of services to its valued customers.
Page 23 of 80
2.15 Corporate Governance
FOUNDER AND FORMER ADVISOR: MR. MIRZA ABBAS UDDIN AHMED
CHAIRMAN: ALTAF HOSSAIN SARKER
MANAGING DORECTOR: MR. KHONDKER FAZLE RASHID
DEPUTY MANAGING DIRECTOR:
MR. TANWEER RAHIM (BUSINESS BANKING)
MR. KAISER TAMIZ AMIN (OPERATIONS)
MR. NEAZ MOHAMMAD KHAN (RISK MANAGEMENT)
Corporate Governance represents the system by which business corporations are directed and
controlled. The Corporate Governance structure specifies the distribution of rights and
responsibilities among different participants in the corporation, such as, the Board, Managers,
Shareholders and other Stakeholders and spells out the rules and procedures for making
decisions on corporate affairs. By doing this it also provides the structure through which the
company objectives are set and the means of attaining those objectives and monitoring
performance. Other than Regulatory Authorities, parties to Corporate Governance are Board of
Directors, Executive Committee of the Board of Directors, Audit Committee of the Board of
Directors, Management Credit Committee, Asset Liability Committee, Management Committee,
etc. The objective of the Management structures headed by the Board of Directors of Dhaka
Bank Limited and led by the Chairman are to deliver sustainable value to shareholders.
Implementation of the strategy set by the Board is delegated to the branch Management and unit
Management under the leadership of Managing Director. The Board sets the strategy and
approves the annual operating plans presented by the Management for achievement of the
strategic objectives. The Board of Directors meets regularly and Directors receive information
Page 24 of 80
between meetings about the activities of the Committees and developments in the Bank's
business. All Directors have full and timely access to all relevant information and may take
independent professional advice if necessary. The Bank has taken the following measures to
implement Corporate Governance as instructed by Bangladesh Bank and the Securities and –
Exchange Commission.
2.16 Environment of Dhaka bank
Quality of working life is easy, fast, durable, safe, furnished, updated. Environment of the
workplace is fully air condition, computerised equipment, on lining each branch, mobile network
facilities etc. Politics & practice are unseen in working environment. A proper hygiene is
maintained.
Sustainable economic, ecological and social developments of the surroundings are the key
elements of business decisions of DBL. Our environmental management policy stipulates
adherence with environmental health and safety regulations and guidelines, refraining from
business that impairs the ability to our future generations to meet their own needs. The policies
with regard to safety, health and environment management are being observed in our lending
decisions; several steps have also been taken within the Bank such as declaring all Dhaka Bank
Branches and offices smoking free zones.
Internal Control System are processes designed by the management and effected by the board of
directors on all tiers of management to provide reasonable assurance regarding the reliability of
financial reporting, operation and risk management and the preparation of financial statements.
Page 25 of 80
2.17 Corporate Social Responsibility (CSR)
In today's competitive globalised economy, CSR has assumed a great deal of importance for all
business enterprises. It enhances adoption of businesses management processes by companies to
have an overall positive impact on society. CSR means continuing commitment by businesses to
behave ethically and contribute to economic development through efforts to improve the quality
of life of the workforce and their families as well as the local community and society at large.
Adoption of CSR is a crucial need for promoting sustainable development and long-term
advancement of businesses. Indeed, CSR is a growing demand being made by the investors and
marketers globally.
The list of Dhaka Bank’s CSR activities:
 Donation to Prime Minister's Relief Fund for bereaved family members of the Army
Officers martyred during the recent carnage at BDR Head Quarter, Peelkhana, Dhaka on
March 10,2009
 Donation to Prime Minister's Relief Fund for bereaved family members of Two Army
Officers martyred during the carnage at BDR Head Quarter, Peelkhana, Dhaka on April
01, 2009.
 Donation to BIRDEM Hospital in 2009.
 Donation to Center for Women & Child Health Hospital in 2009.
Page 26 of 80
 Contribution to Bangladesh Tennis Federation (BTF) as sponsorship of 23rd Bangladesh
International Junior Tennis Championships 2009.
 Financial assistance for Shahidbagh Jame Mosque, Dhaka.
 Financial assistance for Kapasatia Jame Mosque, Hossainpur, Kishoregonj.
 Donation to Bangladesh Hockey Federation for sponsorship of Jawharlal Nehru Cup
Hockey Tournament.
 Donation for the Aila Cyclone Victims.
 Donate 2 units of Ambulances to be used by the Highway Police.
 Donation to the Players and Officials of National Hockey Team for winning 3rd AHP
Cup Tournament held in Singapore.
 Donation to Bangladesh Athletic Federation Sponsorship of 25th National Junior Athletic
Championships 2009.
Page 27 of 80
 Sponsorship of Air Ticket an International player to participate in International Chess
Tournament to be held in Hungary.
2.18 Corporate Banking:
Dhaka Bank offers a full range of tailored advisory, financing and operational services to its
corporate client groups combining trade, treasury, investment and transactional banking activities
in one package.
Whether it is a Project Finance, Term Loan, Import or Export Deal, Working Capital
Requirement or Forward Cover for a Foreign Currency Transaction, our Corporate Banking
Managers will offer you the right solution. You will find top-class skills and in-depth knowledge
of market trends in our Corporate Banking Specialists, speedy approvals and efficient processing
fully satisfying your requirements - altogether a gratifying experience.
At the moment Dhaka Bank’s exposure (as of December 31, 2009) under Corporate Banking
Business is distributed in the following sectors:
Sector DBL’s
Sl. Exposure
(BDT in Crore)
1 Agricultural 30
2 Chemical 130
Page 28 of 80
3 Electronics & Automobile 9

4 Energy & Power 58
Engineering & Metal including Ship
5 Breaking 394
6 Food & Allied 350
7 Housing & Construction 692
8 Pharmaceuticals 56
9 Service 158
10 Textile & Garment 973
11 Transport & Communication 191
11 Others 2,249
Total 5,291
Page 29 of 80
CHAPTER-3
Sectional Study
3.1 Introduction of Foreign Exchange
Foreign Exchange is termed as the means and methods by which rights to wealth expressed in
terms of the currency of one country is converted into rights to wealth in terms of the currency of
another country.
Page 30 of 80
Foreign Exchange means exchange of foreign products, services and currency between two
countries. If we consider “Foreign exchange” as a subject then it means all kind of transactions
related to foreign currency. In other words foreign exchange deals with foreign financial
transaction.
Foreign exchange department is an international department of the bank. It deals with globally
and facilitates international trade through its various modes of services. It bridges between
importers and exporters. Bangladesh bank issues license to scheduled banks to deal with foreign
exchange. These banks are known as authorized dealers. If the branch is authorized dealer in
foreign exchange market, it can remit foreign exchange from local country to foreign country.
This department mainly deals with foreign currency. This is why this department is called
foreign exchange department.
Some national and international laws regulate functions of this department. Among these,
Foreign Exchange Act, 1947 is for dealing in foreign exchange business, and Import and
Export Control Act, 1950 is for Documentary Credits. Governments’ Import &Export policy is
another important factor for import and export operation of banks.
3.2 Foreign Trade
Foreign trade can be easily defined as a business activity, which crosses national boundaries.
These may be between parties or government ones. Trade among nations is a common
occurrence and normally benefits both the exporter and importer. In many countries,
international trade accounts for more than 20% of their national incomes.
Page 31 of 80
Foreign trade can usually be justified on the principle of comparative advantage. According to
this economic principle, it is economically profitable for the country to specialize in the
production of that commodity in which the producer country has the greater comparative
advantages and allow other countries to produce that commodity in which it has the lesser
comparative advantages. It includes the spectrum of goods, services, investment, technology
transfer etc. this trade among various countries calls for loose linkage between the parties dealing
in trade. The banks, which provide such transactions, are referred to as rendering international
banking operations. International trade demands a flow of goods from seller to buyer and of
payment from buyer to seller.
3.3 Activities of Foreign Exchange section
There are three kinds of foreign exchange transactions:

1. Export
2. Import
3. Remittance
3.3.1 Concept of Export
Export/Exporter: Export means flow of goods and services produced within Bangladesh but
purchase by economic agent i.e. individuals, firms, governments of other countries. The
persons/Firms sales the goods & services to another country is called exporter.
An exporter of a country having a trade relation with an importer of another country may not
have enough money to conclude the deal. He may as such need finance from the Bank.
Page 32 of 80
3.3.2 Concept of Import
Import means the goods & services purchase by economic agent located in Bangladesh from
economic agent of other countries.
Financing of import business stores with the contractual obligation between buyer & the Bank.
Financing of import business is a major area of investment of a Bank.
3.3.3 Concept of Remittance
Foreign remittance means remittance of foreign currencies from one place/persons to another
place/person. In broad sense, foreign remittance includes all sale and purchase of foreign
currencies on account of Import, Export, Travel and other purposes. However, specifically
foreign remittance means sale & purchase of foreign currencies for the purposes other than
export and import. As such, this chapter will not cover purchase & sale of foreign currencies on
account of Import & Export of goods.
All foreign remittance transactions are grouped into two broad categories- Outward remittance &
Inward remittance.
At the end of the month Of March 2011 Foreign Trade Business Position is given bellow
(Cumulative):
(Taka in Lac)
L/C Opened
TYPE OF L/C No Amount
Foreign 76 3,045.98
Cash
Local 3 142.96
Back to Foreign 7 899.62
Back Local 25 1,100.99
Total 111 5,189.55
(Taka in Lac)
Page 33 of 80
Import Bills Export Bills

No. Amount Type No. Amount
102 6,002.89
Foreign 83 3,058.23
4 170.52
66 2,094.02
Local 128 5,093.08
77 1,443.46
249 9,710.89 211 8,151.31
3.4 Trade finance Department
This department deals with all processing of Export and Import. Moreover, it also deals with the
foreign remittance. Under this the export department, deals with only the export and the back-to-
back L/C. The total export value of 2009 was 300 crore local BD currency. And most of the
export goods were different types of garments products.
3.5 Letter of credit (L/C)
Letter of credit (L/C) can be defined as a “credit contract” whereby the buyer’s bank is
committed (on behalf of the buyer) to place an agreed amount of money at the seller’s disposal
under some agreed condition.
Since the agreed conditions include, among other things, the presentation of some specified
documents, the letter of credit is called the Documentary Letter of Credit.
The Uniform Custom & Practice for Documentary Credit (UCPDC) published by International
Chamber of Commerce (1993) Revision, Publication No. 500 defines Documentary Credit: any
agreement, however named or described, whereby a bank ( the “issuing bank”), acting at the
request and on the instructions of a customer (the “Applicant”) or on its own behalf, is to make a
Page 34 of 80
payment to or to the order of a third party (the beneficiary), or is to accept and pay bills of
exchange (Drafts) drawn by the beneficiary, or authorizes another bank to effect such payment,
or to accept and pay such bills of exchange (Draft), authorizes another bank to negotiate, against
stipulated documents, provided that the terms and conditions are complied with.
3.5.1 Types of LC
Documentary Credits may be either:
 Revocable
 Irrevocable
 Revocable
When a revocable credit can be amended or cancelled without any prior notice then it is known
as revocable credit.
 Irrevocable Credit
An irrevocable letter of credit is one, which cannot be revoked, amended or modified by the
issuing bank without the concurrence of the beneficiary or any other interested party including
the confirming bank. It is a definite undertaking of the issuing bank and constitutes the
engagement of the bank to the beneficiary or any bonafide holders of the drafts drawn under the
credit, provided the terms and conditions of the credit are complied with.
3.6 Special Documentary Credit
Page 35 of 80
 Revolving Credit
The revolving credit is credit, which provides for restoring the credit to the original amount after
it has been utilized. How many times it will be taking place must be specifically mentioned in the
credit. The revolving credit may be either cumulative or non-cumulative.
 Transferable Credit
In terms of transferable credit, the original beneficiary can transfer the credit to one or more
beneficiaries for once.
 Back-to-Back Credit
It is a secondary credit opened by a bank on behalf of the beneficiary of an original credit, in
favor of a domestic/foreign supplier. The amount of back-to-back credit must not exceed the
amount of original credit and the items/goods must be relevant to the original credit. It facilitates
the beneficiary of the original credit to purchase raw and packing materials.
 Red Clause
This type of credit authorizes the negotiating bank to make advances to the beneficiary for
purchasing goods / raw materials from the local suppliers. In this case, a clause in the letter of
credit is inserted indicating clear instruction about such advances. The 'Red clause' or Green
Page 36 of 80
clause' is called because the clause is generally printed in Red or Green to distinguish it from the
text of the credit.
 Deferred payment L/C:
The issuing bank undertakes to make payment against type of L/C at a future date (e.g.
60/90/180/270/360 days after receipt of order documents). Mainly Capital machinery and
emergency medicine are imported through this type of L/C.
3.7 Parties to a letter of credit
There are a number of parties involved in a L/C and the rights & obligations of the different
involved parties also differ from each other. The involved parties can be named below:
1. Importer/Buyer
2. Opening/Issuing bank
3. Exporter/Seller/Beneficiary
4. Advising/Notifying Bank
5. Confirming Bank
6. Negotiating bank
7. Paying/Reimbursing Bank
Importer/Buyer is the people who request/instructs the opening bank to open a L/C.
He is also called opener or applicant of the credit.
Page 37 of 80
Opening/Issuing Bank is the bank which opens/issues a L/C on behalf of the importer. It is
also called the importer’s/buyer’s bank.
Exporter/Seller/Beneficiary is the party in whose favor the L/C is established
Advising/Notifying Bank is that bank through which the L/C is advised to the exporter. It is a
bank situated in the exporting country and it may be a branch of the opening bank or a
correspondent bank. It may also assume the role of confirming and/or negotiating bank
depending upon the conditions of the credit.
Confirming Bank is a bank, which adds its confirmation to the credit, and it is done at the
request of the issuing bank. The confirming bank may or may not be the advising bank.
Negotiating bank is the bank, which negotiates the bill and pays the amount to the
beneficiary. It has to carefully scrutinize the documentary credit before negotiation in order to
see whether the documents are apparently is in order or not. The advising bank and the
negotiating bank may or may not be one and the same. Sometimes it can also be the confirming
bank.
Paying/Reimbursing bank is the bank as whom be bill will be drawn (as per conditions of
the credit). It is nominated in the credit to make payments against stipulated documents
complying with the terms of the credit. It may or may not be the issuing bank.
Page 38 of 80
3.8 Summary of Procedure: Letter of Credit
 The buyer and seller conclude a sales contract providing for payment by a Documentary
Credit.
 The buyer instructs his bank-the “Issuing Bank”-to issue a Documentary Credit in favor
of the seller (Beneficiary).
 The Issuing Bank issues the Documentary Credit and asks another bank (the Advising
Bank), usually in the country of the seller, to advise or confirm the Documentary Credit.
 The Advising Bank informs the seller that the Documentary Credit has been issued.
 As soon as the seller receives the Documentary Credit and is satisfied that it meets the
terms of the sales contract and that he can meet the Documentary Credit terms and
conditions, he is in a position to effect shipment.
 Seller then sends the required documents to the bank where the Documentary Credit is
made available (the Nominated Bank).
 The bank examines the documents against the Documentary Credit. If they meet the
requirements of the Documentary Credit, the bank will pay, accept or negotiate;
according to the terms of the Documentary Credit.
 The bank, which takes up the documents, sends the documents to the Issuing Bank.
 The issuing bank scrutinizes the documents and if the documents meet the Documentary
Credit requirements, reimburses in the re-agreed manner the Confirming bank or any
other Nominated Bank that has paid, accepted, or negotiated under the Documentary
Credit.
Page 39 of 80
 When the documents have been scrutinized by the Issuing Bank and are found to meet
the Documentary Credit requirements, they are released to the buyer.
 The Issuing Bank obtains reimbursement from the Buyer in the pre-agreed manner.
 The buyer forwards the transport document to the local office or agent of the carrier who
will then affect delivery of the goods to him.
3.9 L/C Advising
Advising through a bank is a proof of apparent authenticity of the credit to the seller.
The typical process of advising a credit consists of
 Forwarding the original Credit to the beneficiary to whom it is addressed.
 Before forwarding, the advising bank has to verify the signature (s) of the officer (s) of
the opening bank and ensure that the terms and conditions of the credit are not in
violation of the existing exchange control regulations and other regulations relating to
export.
 Entry made in the L/C advising register.
 L/C advised to the beneficiary (exporter) promptly and advising charge recovered.
There are two types of L/C Advising
 Foreign L/C Advising
 Local L/C Advising
Page 40 of 80
Foreign L/C Advising
In terms of foreign L/C Advising the swift proves the authenticity of the letter of credit. Under
swift code 700 (01-08) the entire fields is required for the necessity of the foreign letter of credit.
Most importantly the L/C Number (Documentary Credit No), L/C value, Date of Issue, Date of
Advising is being written while advising of FLC. Normally the charge for advising is TK.1500
as bank takes the responsibility of the authenticity of the L/C.
Local L/C Advising
Local L/C is needed mainly for the back to back L/C. In terms of LLC the same procedure is
followed mentioned earlier only the L/C No. is given by the bank.
3.10 Foreign L/C Amendment
After opening of L/C sometimes alteration/amendments to the original terms and conditions
become necessary. These amendments may involve changes in Unit price
 Extension of validity of the L/C
 Documentary requirements etc.
The amendments can be effected only if all the parties concerned i.e. the beneficiary, the
importer, the issuing bank and the advising bank have agreed to the amendments. For any
amendment, the importer (applicant for the credit) must request the opening bank in writing duly
supported by revised indent/proforma invoice etc. where necessary. The opening bank will then
advise the required amendment to the advising bank by mail/swift, as instructed by the importer.
Page 41 of 80
The typical process of amendment involves:
 All amendments should be noted in the L/C file and L/C opening register.
 L/C amendment commission including postage/swift should be charged to the clients
Account
 In case of increase in L/C value, it should be ensured that the balance available in the
LCA form is sufficient to cover the increased L/C amount. If not additional valid LCA
form should be obtained to cover the enhanced amount of L/C. Insurance cover should
also be obtained for enhanced amount.
3.11 Foreign L/C Transfer:
As mentioned earlier the only the first beneficiary can transfer the L/C to other and only for
once. The require documents for transfer are:
 The original copy of L/C
 The original copy of amendment
 The forwarding letter provided by the bank.
Now to transfer the first beneficiary brings the application form and where bank need to verify
the signature and bank check the value of transfer. This because after all the amendment
(increase or decrease) if the present value is not sufficient than the bank will not give the
permission to transfer.
The charges of the above:
Local L/C Advising Tk.1000.00

Foreign L/C Advising US$15.00
Page 42 of 80
Foreign L/C Amendment US$10.00

Foreign L/C Transfer Tk.1500.00
Figure-2: L/C Process

3.12 Issuing of Export Authorization
Page 43 of 80
To export form other parties the seller need to go through some procedure. To register export the
seller takes four Exp. Form these are original, Duplicate, Qua-duplicate and Triplicate. The
negotiating bank has to certify all these four Exp. Form to register.
In the record keeping register the following things need to register.
 Ad’s Code
 Export amount
 Type of product
 Name of the Exporter.
The typical Exp. Form consists of the following information. These are:
Export Form
 Ad’s Code  Port of shipment/ post office of
 Serial No. dispatch
 Year  Land custom post
 Commodity to be exported  Shipment date
 Country of destination  Name of the exporter with
 Port of destination address
 Quantity in terms of Unit or  CCI and E’s registration No.
volume And date of the exporter
 Value  Sector (Public or Private)

under which the exporter falls
 Bill of leading/ railway receipt/
airway bill/ truck receipt/ post  Terms of sale
parcel receipt  Name and address of importer

 Name of carrying vessel
All of this information is being checked and signed by the dealer and authorized official of the
bank after checking the required documents that the exporter need to submit.
Page 44 of 80
Original Exp –Before shipment the original exp. form needs to submit to the Customs. If the
customs officer finds any short of goods then they provide a short shipment certificate to the
seller. And the sellers with the other three Exp. provide the short shipment certificate to the bank.
Duplicate Exp- after the shipment customs send the original Exp. to the Bangladesh Bank. As
negotiating bank get all the Exp. form from the exporter, they have to submit the duplicate to the
Bangladesh Bank within 14 days of shipment. Duplicate has to submit in every 15days on the
month.
Triplicate Exp- Triplicate is another form of Exp. that has to be submitted to the Bangladesh
Bank after all the charges and the negotiating bank is realizing export value. Triplicate has to
submit monthly to the Bangladesh Bank.
Qua-duplicate- this is to keep the banking record for future reference. Mainly, all these four
document processing starts before the shipment of the products.
3.13 Job Description
Page 45 of 80
As issuing of the export authorization form is the first step, so for that I had to register the Exp.
Form and its information to the register. And at the same time I have to give input in the system
at different period of time to the head office to ensure the updated information regarding export.
Again, I had to advise foreign L/C and Local L/C, Amendment of Foreign L/C and most
importantly Transfer of L/C.
As it is mentioned that at different period of time duplicate and triplicate needs to be reported to
the Head Office as the Head Office needs to report it to the Bangladesh Bank, so I had to give
input of the duplicate and triplicate in the system. After that I have to make a printout of the
posted document and take sign of the Authorized officer and with a forwarding and hard copy of
duplicate and triplicate I have send these to the head office.
To advise Foreign or Local L/C normally I had to first make an entry to the register and put /give
a unique No. in the L/C for future reference. Than I have to make forwarding letter for the
exporter mentioning the common terms and condition and most importantly the charges. Before
that I had to call the exporter or the commercial person of the buying house agent to collect the
L/C form the bank. In terms of LLC, the issuing bank authorized officer signature and seal has to
be checked first and for FLC first I have to check the Field No. Which is 700 for the L/C then
normally under that 21 field is the L/C No. 59 field shows the name of exporter and 32B and
39A with amount and issuing date has to be mentioned. This is also following in terms of
amendment and transfer. Most importantly for all these documentation is a must. For that
original copy with forwarding letter and authorized signature has to be submitted to the exporter
and bank has to keep the photocopy of it. For every advising separate seal has to be marked in
the original document. Finally, if all the documents are verified by the authorized officer I had to
Page 46 of 80
call the commercials of the buying house or the exporter to come & collect their L/C and keep
the photocopy of the same document with the signature of the exporter as the proof.
Page 47 of 80
CHAPTER-4
Proposal
Page 48 of 80
4.1 Background Information:
Bangladesh economy has been experiencing a rapid growth since the '90s. Industrial and
agricultural development, international trade, inflow of expatriate Bangladeshi workers'
remittance, local and foreign investments in construction, communication, power, food
processing and service enterprises ushered in an era of economic activities. Urbanization and
lifestyle changes concurrent with the economic development created a demand for banking
products and services to support the new initiatives as well as to channelize consumer
investments in a profitable manner. A group of highly acclaimed businessmen of the country
grouped together to respond to these needs and established Dhaka Bank Limited in the year
1995.
In Bangladesh today financial sector is one of the most establish area. For the aspects of
economic development, financial sector must be reform. So it is necessary to form a good
economic system. Public banking especially group of companies are playing an important role
compare to the government organization. For this reason I prepared my internship report on
Dhaka Bank limited.
Page 49 of 80
4.2 Problem Study
During my internship I work on Dhaka Bank Limited especially foreign trade finance
department. I was tried to find out that the customers of DBL are face some problem or not. I
talked to them & want to identify as customer what types of services they want. Are they happy
present services of DBL?
To find out these types of answer I am doing this research.
4.2 Project Duration

One Month- March 01, 2011 to April 01, 2011
4.3 Cost/Budget
Particular Amount
Papers 100
Communication 200
Mobile Bill 150
Others 400
Total 850
Page 50 of 80
CHAPTER-5
Survey Part
5.1 Methodology
Page 51 of 80
Sample Size:
The study sample size of this report is 40 & all candidates were selected randomly
Here, n = sample size = 40
Sampling Procedure:
All randomly selected candidates were categorized. The categories were irregular customers
doing banking with multiple banks, regular & frequent existing customers & newly joined
customers.
Data Collection Procedure and Instruments:
For conducting this research, the following procedures will be used to collect data with the
respective instruments.
Collection of primary data:
For collecting primary data personal interview technique is being used through a set of
structured questionnaire as the instruments to collect data.
Collection of secondary data:
Secondary data were collected by reviewing trade magazines, trade journals, economy
journals issued by department of commerce & department of finance.
Data collection instruments:
Data collection instrument is the questionnaire with 5-point liker scale questions.
Data Processing and Matrix:
Page 52 of 80
After collecting all the data, the questionnaire has been coded and data is being processed,
analyzed, and graphically represented by using appropriate tools and techniques.
5.2 Hypothesis Development
With a view of fulfilling the objectives some relevant hypothesis have been formulated for this
study:
1. HA: The Bankers have proper knowledge on Foreign Trade.
2. HA: For opening a L/C Dhaka Bank follows the rules of Bangladesh Bank.
3. HA: Issuing EXP is easier than other banks.
4. HA: For advising the L/C Dhaka Bank takes a short time.
5. HA: Customers can easily amendment their L/C without facing any problem.
6. HA: Dhaka Bank has the ability to make a good relation with L/C opening
bank for Export.
7. HA: Without checking all papers Dhaka Bank allows opening your L/C.
8. HA: For opening local L/C & advising foreign L/C Dhaka bank charges
higher than other banks.
9. HA: Customers can easily open their Back to Back L/C against their main
L/C.
10. HA: Customers can purchase whatever they want against their L/C amount.
Page 53 of 80
Ho: Achieving Specific degrees/certificates have no positive

effect on graduates' employability
HA: Achieving Specific degrees/certificates h a v e p o s i t i v e

e f f e c t o n g r a d u a t e s ' employability
HYPOTHESIS TESTING
Table: Summary of Responses of customer of Dhaka Bank Limited
H1H H2H H3H H4H H5H H6H H7H H8H8 H9 9 H1010

H11 2 3 H44 5 6 H77
1=Strongl 0 0 2 0 0 0 0 25 14 35
y disagree
2= 0 3 4 0 8 2 2 8 4 4
Disagree
3=Neutral 8 8 10 7 3 8 12 5 14 1
4= Agree 15 10 15 12 10 11 22 2 8 0
5= 17 19 9 21 19 19 04 0 0 0
Strongly
agree
Total 169 165 145 174 160 167 148 64 96 46
Average 4.23 4.13 3.6 4.35 4 4.18 3.70 1.60 2.40 1.15
3
Standard 0.73 0.98 1.0 0.76 1.1 0.90 0.71 0.88 1.15 0.42
Deviation 7 6
Z-test 15.7 10.5 6.6 15.4 8.3 11.8 10.9 (6.4 (0.5 (20.45
value 2 1 5 1 3 3 0 3) 3) )
Sources: Questionnaire Survey.
1. The Bankers have proper knowledge on Foreign Trade
H0: The Bankers do not have proper knowledge on Foreign Trade.
Page 54 of 80
HA: The Bankers have proper knowledge on Foreign Trade.

In other words,
xi fi fixi fixi×xi
H0: µ = 2.5 5 17 85 425
4 15 60 240
HA: µ > 2.5 3 8 24 72
*In a 5-point scale, the mean 2 0 0 0
value is µ = 2.5 1 0 0 0
40 169 737
n= 40 Level of Significance: 0.05

Here, (X ) = ∑ fixi
n
(X ) = 169
40
(X ) = 4.23
[
∑ fixi × xi ( )
− X ]
2
σ= n
737
[ − 4.232 ]
σ= 40
σ = 0.73
4.23 − 2.5
Z test = ( -µ)/ (σ/√n) = 0.73 = 15.72
40 Fig: Respondents’ view towards specific degrees
Interpretation: At 5% level of significance, follows Z distribution Z0.05 = 1.645

Since Z Cal > Z tab (15.72>1.645), the null hypothesis is not accepted. Therefore, it can be said that
at 5% level of significance, The Bankers have proper knowledge on Foreign Trade.
80% respondents had agreed that The Bankers have proper knowledge on Foreign Trade.
2. For opening a L/C Dhaka Bank follows the rules of Bangladesh Bank..
H0: For opening a L/C Dhaka Bank does not follow the rules of Bangladesh Bank.
HA: For opening a L/C Dhaka Bank follows the rules of Bangladesh Bank.
In other words, xi fi fixi fixi×xi

5 19 95 475
4 10 40 160
Page 55 of 80
3 8 24 72
2 3 6 12
1 0 0 0
40 165 719
H0: µ = 2.5
HA: µ > 2.5
*In a 5-point scale, the mean value is µ = 2.5

n
(X ) = 165
40
(X ) = 4.13
[
∑ fixi × xi ( )]
− X
2
σ= n
719
σ = [ 40 − 4.13 ]
2
σ = 0.98
Fig: Respondents’ view towards specific degrees
4.13 − 2.5
Z test = ( -µ)/ (σ/√n) = 0.98 = 10.51
40
at 5% level of significance, for opening a L/C Dhaka Bank follows the rules of Bangladesh
Bank.
72% respondents had agreed that for opening a L/C Dhaka Bank follows the rules of
Bangladesh Bank.
3. Issuing EXP is easier than other banks.
H0: Issuing EXP is not easier than other banks.

HA: Issuing EXP is easier than other banks.

5 9 45 225
H0: µ = 2.5 4 15 60 240
3 10 30 90
HA: µ > 2.5
2 4 8 16
1 2 2 2
40 145 573
Page 56 of 80
*In a 5-point scale, the mean value is µ = 2.5

n
(X ) = 145
40
(X ) = 3.63
[
∑ fixi × xi ( )]
− X
2
σ= n
573
σ= [ − 3.63 2]
40
σ = 1.07
3.63 − 2.5
Z test = ( -µ)/ (σ/√n) = 1.07 = 6.65
40
Since Z Cal > Z tab (6.65>1.645), the null hypothesis is not accepted. Therefore, it can be said that at
5% level of significance, Issuing EXP is easier than other banks.
50% respondents had agreed that Issuing EXP is easier than other banks.
4. For advising the LC Dhaka Bank takes a long time.
H0: For advising the LC Dhaka Bank does not take a short time.
HA: For advising the LC Dhaka Bank takes a short time.

5 21 105 525
H0: µ = 2.5 4 12 48 192
HA: µ > 2.5 3 7 21 63
2 0 0 0
*In a 5-point scale, the mean value is µ 1 0 0 0
= 2.5 40 174 780

∑ fixi
n Page 57 of 80
Here, (X ) =
(X ) = 174
40
(X ) = 4.35
[
∑ fixi × xi ( )]
− X
2
σ= n
780
σ= [ − 4.35 2 ]
40
σ = 0.76
4.35 − 2.5
Z test = ( -µ)/ (σ/√n) = 0.76 = 15.41
40
at 5% level of significance, for advising the LC Dhaka Bank takes a short time.
82% respondents had agreed that for advising the LC Dhaka Bank takes a short time.
5. Customers can easily amendment their L/C without facing any problem.
H0: Customers cannot easily amendment their L/C without facing any problem.
HA: Customers can easily amendment their L/C without facing any problem.

5 19 95 160
H0: µ = 2.5 4 10 40 160
3 3 9 27
HA: µ > 2.5
2 8 16 32
= 2.5 40 160 694

n
160
40
Page 58 of 80
(X ) =
(X ) = 4
[
∑ fixi × xi ( )]
− X
2
σ= n
694
σ= [ − 42 ]
40
σ = 1.16

4 − 2.5
Z test = ( -µ)/ (σ/√n) = 1.16 = 8.33
40
Since Z Cal > Z tab (8.33>1.645), the null hypothesis is not accepted. Therefore, it can be said that at
5% level of significance, Customers can easily amendment their L/C without facing any
problem. 82% respondents had agreed that Customers can easily amendment their L/C
without facing any problem.
6. Dhaka Bank has the ability to make a good relation with L/C opening bank for Export.
H0: Dhaka Bank do not have the ability to make a good relation with L/C opening bank for
export.
HA: Dhaka Bank has the ability to make a good relation with L/C opening bank for Export.
In other words,
xi fi fixi fixi×xi
H0: µ = 2.5 5 19 95 475
HA: µ > 2.5 4 11 44 176
3 8 24 72
= 2.5 1 0 0 0
40 164 731
n
(X ) = 167
40
(X ) = 4.18
Page 59 of 80
[
∑ fixi × xi ( )]
− X
2
σ= n
731
σ= [ − 4.18 2 ]
40
σ = 0.90
4.18 − 2.5
Z test = ( -µ)/ (σ/√n) = 0.90 = 11.83
40
at 5% level of significance, Dhaka Bank has the ability to make a good relation with L/C opening
bank for Export. 75% respondents had agreed that Dhaka Bank has the ability to make a good
relation with L/C opening bank for Export.
7. Without checking all papers Dhaka Bank allows opening your L/C.
H0: Without checking all papers Dhaka Bank doesn’t allow opening your L/C.
HA: Without checking all papers Dhaka Bank allows opening your L/C.
xi fi fixi fixi×xi
In other words, 5 4 20 100
H0: µ = 2.5 4 22 88 352
3 12 36 108
HA: µ > 2.5 2 2 4 8
1 0 0 0
*In a 5-point scale, the mean value is µ 40 148 568
= 2.5

n
(X ) = 148
40
(X ) = 3.7
[
∑ fixi × xi ( )]
− X
2
n Page 60 of 80
σ=
568
σ= [ − 3.72 ]
40
σ = 0.71
3.7 − 2.5
Z test = ( -µ)/ (σ/√n) = 0.71 = 10.90
40
at 5% level of significance, Without checking all papers Dhaka Bank allows opening your
L/C. 65% respondents had agreed that Without checking all papers Dhaka Bank allows
opening your L/C.
8. For opening local L/C & advising foreign L/C Dhaka bank charges higher than other banks.
H0: For opening local L/C & advising foreign L/C Dhaka bank charges are not higher than
other banks.
HA: For opening local L/C & advising foreign L/C Dhaka bank charges higher than other
banks.
In other words,
xi fi fixi fixi×xi
H0: µ = 2.5 5 0 0 0
HA: µ > 2.5 4 2 8 32
3 5 15 45
= 2.5 1 25 25 25
40 64 134
n
(X ) = 64
40
(X ) = 1.6
[
∑ fixi × xi ( )]
− X
2
σ= n
134
[ −1.62 ]
40
Page 61 of 80
σ=
σ = 0.88

1.6 − 2.5
Z test = ( -µ)/ (σ/√n) = 0.71 = -6.43
40
Since Z Cal > Z tab (-6.43<1.645), the null hypothesis is accepted. Therefore, it can be said that at
5% level of significance, for opening local L/C & advising foreign L/C Dhaka bank charges are
not higher than other banks. 83% respondents had disagreed that for opening local L/C & advising
foreign L/C Dhaka bank charges higher than other banks.
9. Customers can easily open their Back to Back L/C against their main L/C.
H0: Customers cannot easily open their Back to Back L/C against their main L/C.
HA: Customers can easily open their Back to Back L/C against their main L/C.
In other words,
xi fi fixi fixi×xi
H0: µ = 2.5 5 0 0 0
HA: µ > 2.5 4 8 32 128
3 14 42 126
= 2.5 1 14 14 14
40 96 284
n
(X ) = 96
40
(X ) = 2.4
[
∑ fixi × xi ( )]
− X
2
σ= n
284
σ= [ − 2.42 ]
40
Page 62 of 80
σ = 1.15

2.4 − 2.5
Z test = ( -µ)/ (σ/√n) = 1.15 = -0.53
40
5% level of significance, Customers cannot easily open their Back to Back L/C against their
main L/C. 45% respondents had disagreed that Customers easily open their Back to Back L/C
against their main L/C.
10. Customers can purchase whatever they want against their L/C amount.
H0: Customers cannot purchase whatever they want against their L/C amount.
HA: Customers can purchase whatever they want against their L/C amount.
In other words,
xi fi fixi fixi×xi
H0: µ = 2.5 5 0 0 0
HA: µ > 2.5 4 0 0 0
3 1 3 9
= 2.5 1 35 35 35
40 46 60
n
(X ) = 46
40
(X ) = 1.15
[
∑ fixi × xi ( )]
− X
2
σ= n
60
σ= [ −1.15 2 ]
40
σ = 0.42
Page 63 of 80

1.15 − 2.5
Z test = ( -µ)/ (σ/√n) = 0.42 = -20.45
40
5% level of significance, Customers cannot purchase whatever they want against their L/C
amount. 98% respondents had disagreed that Customers can purchase whatever they want
against their L/C amount.
CHAPTER-6
FINDINGS &
RECOMMENDATION
Page 64 of 80
6.1 Findings
DBL is always trying to improve their Customer Services in every sector, but in today’s
Competitive Business World, Banks need to focus on more reliable, effective & satisfactory
ways of Clients’ requirements in order to stay at the top. Considering this view, I have tried to
analyze the entire questions & have come up with some special findings. The summary of my
findings are given as given below:
i. The Bankers have proper knowledge on Foreign Trade. This statement’s analysis shows
that most of the respondents think this statement is right & thus considers that the bankers
have proper knowledge on foreign trade.
ii. For opening a L/C Dhaka Bank follows the rules of Bangladesh Bank. This statement’s
analysis shows that most of the respondents think this statement is right & thus considers
that DBL follows the rules.
iii. Issuing EXP is easier than other banks. This statement’s analysis shows that most of the
respondents think this statement is right. In DBL issuing EXP is real easy.
Page 65 of 80
iv. For advising the L/C Dhaka Bank takes a short time. This statement’s analysis shows that
most of the respondents think this statement is right. DBL is very punctual & professional
for advising L/C.
v. Customers can easily amend their L/C without facing any problem. This statement’s
analysis shows that most of the respondents think this statement is right. Customers can
easily make L/C amendments.
vi. Dhaka Bank has the ability to maintain a good relation with L/C opening bank for Export.
This statement’s analysis shows that most of the respondents think this statement is right.
DBL shares & maintains good relation with other banks.
vii. Without checking all papers Dhaka Bank allows opening your L/C. This statement’s
analysis shows that most of the respondents think this statement is right. Sometime DBL
allows opening a L/C without checking all papers to trust worthy customers.
viii. For opening local L/C & advising foreign L/C, Dhaka bank charges higher than other
banks. This statement’s analysis shows that most of the respondents think this statement
is not true. In fact DBL charges are same as other banks.
ix. Customers can easily open their Back to Back L/C against their main L/C. This
statement’s analysis shows that most of the respondents think this statement is not
correct. At DBL customers face some problems to open their Back to Back L/C.
x. Customers can purchase whatever they want against their L/C amount. This statement’s
analysis shows that most of the respondents think this statement is not right. At DBL
customers are never allowed to purchase whatever they want.
Page 66 of 80
6.2 Recommendations
I have drawn some recommendations on the basis of my studies at the bank. These are as
follows:
i. The Bankers have proper knowledge on Foreign Trade that’s why they should take some
initiatives to start modern ways & technologies on online banking such as online L/C
opening.
ii. Issuing EXP is easier than other banks. In this case bankers have to be more careful &
make sure that the exporters do not make mistakes.
iii. For advising the L/C Dhaka Bank takes a short time and customers can easily amendment
their L/C without facing any problem. By using this benefit sometime customers can take
advantage such as increasing dollar amount in their L/C. So the Bankers have to handle this
matter very carefully & professionally.
iv. Dhaka Bank has the ability to maintain a good relation with L/C opening bank for Export.
With this ability of maintaining good relations with other Banks, DBL could come up with a
proposal of making an agreement with other banks for permanently L/C opening issues.
Page 67 of 80
v. Without checking all papers Dhaka Bank allows opening your L/C. Just for the sake of
good relation if DBL continues doing this, it may cause great damage someday. Before
opening the L/C DBL should check all the documents & make sure that it’s all proper &
correct.
vi. Customers cannot easily open their Back to Back L/C against their main L/C. In this case
DBL has to follow the system of other banks & review their service levels & find out where
they lack in providing smooth service to their customers. If they can sort out this problem &
come up with better service DBL can add more customers on their account.
vii. Due to lack of fund DBL could not allow customers to purchase maximum against their
L/C amount. So DBL needs to increase their fund.
Page 68 of 80
CHAPTER-7
Conclusion
Page 69 of 80
7.0 Conclusion
The end of my report conclusion is:
DBL is performing its foreign trade finance in a very efficient & professional way. DBL is well
positioned & organized to meet the challenges and will take the opportunity of making benefit
from economic growth.
The bank is serving as a partner and advisor of the clients to trade, commerce and industry. This
strategy is supported by wide spectrum of products and services.
DBL is maintaining a well-structured communication from top to bottom level. Each official
treats the foreign trade services of the bank as a vital part of the bank so that they can succeed in
the corporate world.
DBL places utmost importance on managing foreign exchange. The whole process includes
management of export, import, remittance, Foreign Exchange Risk & successful completion of
trade. The bank always tries to increase its foreign exchange performance. As the bank is located
in commercial area it is a great opportunity for the bank to attract customers. Though it has
some problems with its foreign exchange department, it is always trying to accelerate its foreign
trade. 16 years success story of DBL has helped the bank to attain & maintain a leading role but
to remain unrivalled among new generation banks; the bank must face new challenges. Overall,
the bank must make a positive & effective attempt to be more outward looking in their goals and
aware of current situation. They must also emphasize on the domestic scenario more closely and
analyze any certain trends and strategies of their competitors. The bank must also accept any
failure incidents and consider them as an objective to pursue future goals instead of blaming such
failures on other factors.
Page 70 of 80
Bibliography
1. Annual Report of Dhaka Bank Ltd.-2009
2. Web Site of Dhaka Bank Limited (DBL) www.dhakabankltd.com
3. Different types of brochures of National Bank Ltd.
4. Economic Trends: Statistics Department of Bangladesh Ban
5. Faruquddin Ahmed: “Banking in Bangladesh-Evolution and Present
Status”, Volume xxv, No. Faser, Donald R, Commercial Banking, 5th
edition, West Publication Company, 2002.
6. Previous Internship Reports
Page 71 of 80
Chapter-8
Appendix
Page 72 of 80
Appendix-1
QUESTIONNAIRE
(All the information will be kept confidential and the secrecy of the respondent will be
properly maintained.)
Name:……………………………………………….. Age:………… Sex:………........

Position of his own company:…………………………….
(Note: The answers will be made in a 5 points rating scale. Here,
5 points = Strongly Agree 4 points = Agree 3 points = Neutral

2 points = Disagree 1 points = Strongly Disagree
1. The Bankers have proper knowledge on Foreign Trade----

o (5) Strongly Agree
o (4) Agree
o (3) Neutral
o (2) Disagree
o (1) Strongly Disagree
2. For opening a L/C Dhaka Bank follows the rules of Bangladesh Bank -------
o (4) Agree
o (3) Neutral
o (2) Disagree
3. Issuing EXP is easier than other banks-----------

o (4) Agree
o (3) Neutral
o (2) Disagree
Page 73 of 80
4. For advising the L/C Dhaka Bank takes a short time ---------
o (4) Agree
o (3) Neutral
o (2) Disagree
5. Customers can easily amendment their L/C without facing any problem ----
o (4) Agree
o (3) Neutral
o (2) Disagree
6. Dhaka Bank has the ability to make a good relation with L/C opening bank
for Export ------------
o (4) Agree
o (3) Neutral
o (2) Disagree
7. Without checking all papers Dhaka Bank allows opening your L/C------------
o (4) Agree
o (3) Neutral
o (2) Disagree
Page 74 of 80
8. For opening local L/C & advising foreign L/C Dhaka bank charges higher
than other banks -------------
o (4) Agree
o (3) Neutral
o (2) Disagree
9. Customers can easily open their Back to Back L/C against their main L/C--
o (4) Agree
o (3) Neutral
o (2) Disagree
10. Customers can purchase whatever they want against their L/C amount-----
o (4) Agree
o (3) Neutral
o (2) Disagree
Page 75 of 80
Appendix-2
Different types of Documents from Foreign Exchange
NOTIFICATION OF IRREVOCABLE
OUR REF NO. DOCUMENTARY CREDIT
DBL/BAN/LLC/149/09
DATED. April 16, 2009
BENEFICIARY
ISSUING BANK
EASTERN BANK LTD WASEQ TEXTILE MILLS LTD

HEAD OFFICE HOUSE NO.B-139 (21ST FL), ROAD# 22
TRADE SERVICES DIVISION NEW D.O.H.S MOHAKHALI
JIBAN BIMA BHABAN DHAKA.
IST FLOOR, 10, DILKUSHA C.A
DHAKA-1000
BANGLADESH
DOCUMENTARY CREDIT NO.:

147809041243 AMOUNT
US$ 2342.56
DATED: April 12, 2009
• We advise the enclosed Documentary Credit intended for you issued by above-mentioned
Bank.
• Check the credit terms and conditions carefully. In the event of anything, which is contrary to
the guidelines for Foreign Exchange Transactions of you do not agree with the terms and
conditions or if you feel unable to comply with any of these terms and conditions, kindly
arrange an amendment of the credit.
• This notification and the enclosed advice are sent to you without any engagement on our
part.
Page 76 of 80
• Subject to UCPDC, 2007 Revision, and ICC publication 600, Article 9.
Please pay/authorize us to realize Tk.1000.00 as advising charge.
-----------------------------------------------
Authorized Signature
OUR REF. NO.

NOTIFICATION OF IRREVOCABLE
DBL/BAN/FLC/075/09/A-01
DOCUMENTARY CREDIT
April 8, 2009
ISSUING BANK: BENEFICIARY:
WACHOVIA BANK MBM GARMENTS LTD

M19 & M14, SECTION # 14
HONG KONG MIRPUR, DHAKA-1206
DOCUMENTARY CREDIT NO.
INCREASE AMOUNT
126593
US$ 27015.84
DATED March 20, 2009
NEW DOC CREDIT AMOUNT

AMENDMENT NO.01
DATE: April 07, 2009 US$ 107207.55
• We advise the enclosed AMENDMENT of DOCUMENTARY LETTER OF CREDIT intended

for you issued by above-mentioned Bank.
• Check the credit terms and conditions carefully. In the event of anything that is
contrary to the guidelines for Foreign Exchange Transactions or you do not agree with the
terms and conditions or if you feel unable to comply with any of these terms and conditions,
kindly arrange an amendment of the credit.
• This notification and the enclosed advice are sent to you without any engagement on
our part.
• This Documentary Credit is subject to Uniform Custom and Practice for Documentary
credit (2007 Revision) International Chamber of Commerce: Brochure No 600.
Please pay/authorize us to realize Tk.350.00 as advising charge.
Page 77 of 80
---------------------------------------
Authorized Signature
DBL/BAN/EXP/08
December 24, 2008
BARCLAYS BANK PLC

FRANCE.
Subject : Partial Transfer Against Your Transferable L/C # PSDC10200804
Dated December 15, 2008 for US$ 8,244.30
Dear Sir:
At the request of the prime Beneficiary Spectra SN. Tex Ltd., House # 67, Block-I, Road # 1, Banani,
Dhaka-1213, Bangladesh and without any engagement on our part, we authenticate the following transfer
of your above credit:
Name & Address

Our Transfer Reference Transferred Value
of the Transferee
DBL/BAN/FLC/238/08/TR- M/S. Babylon Casualwear Ltd.

01 Plot No. 23-24,
Union Telulzhora, Savar US$2,622.36
Dhaka , Bangladesh.
With best regards
For DHAKA BANK LIMITED

Banani Branch, Dhaka.
Page 78 of 80
___________________ ___________________
Authorized Signature Authorized Signature
Appendix-3
Snapshot of the software for EXP Issue
Page 79 of 80
Page 80 of 80

Body of The Report 3

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Body of The Report 3

Uploaded by

Copyright:

Available Formats

Foreign Trade Finance of Dhaka Bank Limited

1.1. Background of the Study:

agricultural development, international trade, inflow of expatriate Bangladeshi workers'

remittance, local and foreign investments in construction, communication, power, food

investments in a profitable manner. A group of highly acclaimed businessmen of the country

expand the network.

customers, backed by the state–of–the-art technology and a team of highly motivated

commerce and high yield on investments.

1.2 Rationale of the study:

Economy of Bangladesh is in the group of world’s most undeveloped economies.

if it wants to be developed. My study on the bank has created an edge on my professional

1.3 Research Objectives:

preparing the report, I would like to set up objective of my study as:

1.3.1 Primary Objective:

1.3.2 Specific Objectives:

 To understand & identify the functions of Foreign Trade in DBL.

 To understand the legal formalities required in foreign trade.

 To understand the importance of foreign trade.

Scope & Limitations of the study:

more data to acquire deep understanding.

 Supply of more practical and up to date data was another shortcoming.

 The study was not done very successfully due to inexperience.

1.4 Information needs:

information will be required:

to Trade Finance department.

 I have to collect latest annual report of DBL.

2.0 Organizational Part

2.1 Historical Perspective

confidence immediately after its establishment.

Stipulated Requirements for the Banks in Bangladesh.

2.2 Mission & Vision

Motivated Personnel to deliver Excellence in Banking.

them in profound admiration and speculation.

yield on your investments.

the year 2012.

2.3 Goals of the Bank

Commercial Banks in Bangladesh by the year 2015.

 To be one of the best Banks of Bangladesh.

 To achieve Excellence in Customer Service next to none and superior to

 To cater to all differentiated segments of Retail and Wholesale Customers.

 To be a High Quality Distributor of Product and Services.

 To use state of the Art Technology in all spheres of Banking.

backgrounds can reach their full potential.

Opportunities, and due recognition of superior performance. A good working environment

2.6 Management System

2.7 Correspondent Relationship

which is gradually expanding. The number of Foreign Correspondents is now 406.

2.8 Departments of DBL

well. Different Departments of DBL are as follows:

 Human Resources Division

 Personal Banking Division

 Computer and Information Technology Division

 Finance & Accounts Division

 Financial Institution Division

 Audit & Risk Management Division

2.9 Existing Branches:

C/A, Dhaka-1000. The exiting Branches are:

1. Local Office: Adamjee Court (G.Floor),

Dhanmondi R/A, Dhaka.

2.10 Organization Structure

Deputy Managing Deputy Managing Director

Senior Vice Vice President SVP, Audit & Senior