An Internship Report

On Credit management of Mutual Trust Bank Limited

An Internship Report

On

Credit Management of Mutual Trust Bank limited. A Study on

Mutual Trust Bank LimitedSubmitted to: Muhsina Akter Lecturer in Accounting Department of Business Administration,

Submitted By: MD. AL_AMIN Id: 0821BBA00840 Major in Finance & Banking,

Dept. of Business Administration,

MANARAT INTERNATIONAL UNIVERSITY

Date of Submission: May 25, 2012

May 25,2012To

Muhsina Akter

Lecturer in Accountion

Department of Business Administration,

LIMKOKWING UNIVERSITYSubject: Submission of Internship report Dear Sir,

With due respect, I beg to state that my name is MD. AL-AMIN & my ID is 0821BBA00840, would like to inform you that, there is the report on Credit Management of Mutual Trust Bank Limited at Baridhara Branch, Dhaka; that was assigned to me to submit under the internship program. It was a great pleasure for me to do the assigned job. I made every endeavor to prepare this report accurate & tried my level best to make this report. This report really helps me to understand the difference between practical and theoretical knowledge of this Bank.In this circumstance, I am very grateful to you for assigning me in such an important area of banking and your kind and generous guidance to make the report successful.

Sincerely Yours,

IMDADUL HOQUEID: 294BBA-07Department of Business Administration,

LIMKOKWING UNIVERSITY

May 21, 2012

I am, IMDADUL HOQUE , declare that the Internship Report on Credit Management of Mutual Trust Bank Limited in Baridhara Branch, Dhaka; this report is the result of my own research works, made under the arrangement of Mutual Trust Bank Limited.I further affirm that the work reported in this report is original and this report has not been submitted to any other university or institution for any degree or any other purpose.

-----------------------------------------------

IMDADUL HOQUEId:294BBA-07Major in Finance & Banking,

Department of Business AdministrationLIMKOKWING University Bangladesh.LIMKOKWING UNIVERSITY

Certificate of supervisor

To Whom It May Concern

This is to certify that, IMDADUL HOQUE, a student of BBA program, Major in Finance& Banking, Department of Business Administration, LIMKOKWING UNIVERSITY, has completed the internee report titled Credit Management of Mutual Trust Bank Limited in Baridhara Branch, Dhaka successfully under my supervision.

I wish him every success in his life.

Supervisor

Muhsina AkterLecturer in Accounting,

Department of Business Administration,LIMKOKWING UNIVERSITY

Praise to be Almighty, the creator and sustainer who has given me the strength and opportunity to complete my Internship Report on the topic of Credit Management Of Mutual Trust Bank Limited as a part of my completing Bachelor of Business Administration degree which reveals not only read but also realize the subject deeply and knowledge has no valui8e. So it is very necessary to achieve practical knowledge and clear concept about the subject. The practical experience also helps the learners to gather new idea and techniques. Form this view the Business Administration Department of LIMKOKWING UNIVERSITY has introduced an internship program in order to obtain practical knowledge related with the different fields of Business.

To full these criteria, I had to work in Mutual Trust Bank at Baridhara Branch. In this study and observation about three month I have gathered knowledge on Credit Management & Financial Performance Evaluation of Mutual Trust Bank Limited.

All praises to almighty who has created me and has given me opportunities and strength to prepare this internship paper. This report might never have been completed without the necessary practical knowledge, assistance of many books, articles, websites, and primary data.

I express my heartiest gratitude and deepest respect to my internship advisor Muhsina AkterLecturer in Accounting, Department of Business Administration, without whos priceless and fathomless supports I would not have been able to produce this report. Because, a lot of insights and knowledge I have put and used to the material covered to this report, I learned and gathered from his vigorous instructions.

Particularly, I would like to acknowledge gratefully to Mr. Md Abdul Latif ( SVP & Manager), Mr. Md Shahinoor Rahaman (JAVP), Abu Hassan Fuad ( In-Charge, Credit Department), Ayesha Khanam Tumpa (Junior Officer), Mr. A K M Abdul Hye (Assistant Officer), who gave me some special directions, information and advice about various banking systems and procedures from time to time.

I also owed to my dearest parents and honorable teachers of LIMKOKWING UNIVERSITY who have given me the light of knowledge from earlier to till today and who have displayed their helping hands to us during the studies.

Finally, special thanks are due to my family members, relatives, friends and other well wishers for their loving encouragement and support.

Thanks To All

IMDADUL HOQUE..

SignatureDate:

Mutual Trust Bank is one of the important private commercial bank in Bangladesh. Different important task are held over here. MTBLs dialog is You can bank on us. So they try to understand that they are always with you to provide their services & we can rely on them. So MTBL plays a vital part for the every single consumer those are involved with MTBL.

General banking is the starting point of all the banking operations. General Banking department performs the majority functions of a bank. It is the core department. In fact, bank operates with the peoples money. And this process starts with the General Banking department. Credit Management department plays a vital role in providing loan to the customer of the bank. From the beginning of the Mutual Trust Bank they attract Corporate Customer.

Mutual Trust Bank provides all kinds of services like credit facilities, foreign exchange transactions which include import, export and foreign remittance. They Provide various types loan to the customer such as Auto loan, Personal loan, Car loan, Home loan etc.

Baridhara branch follows various rules and regulations, policies and procedures relating to Credit activities strictly. It is the most profitable branch among all the branches of MTBL.

This report is presented in several parts in a sequential manner. At first, I have highlighted the brief of history of Mutual Trust Bank, its product and services. Here also describe about the conventional banking system. It follows the alternative concept of Conventional Banking which represents unique human approaches to credit and banking based on profit-oriented economy devoid of interest. Also discuss about their ratio analysis where indicate difference ratio and also compare with of the year 2008 and 2009.

This report has several chapters and each chapter discuss different issues regarding the topic. In the third chapter I discuss the organization profile. Banks are the foundations of the financial system of a country. Specially, in Bangladesh, proper banking system is very important, because the capital market is little developed here.

Mutual Trust Bank Limited has now emerged as a renowned and a reliable financial institution. Recently, banks are in a period that they earn money in servicing beyond selling money.

This report mainly focuses on the Credit Management techniques and financial performance evaluation of Mutual Trust Bank Ltd. Mutual Trust Bank Limited has been able to manage its credit portfolio skillfully and kept the classified loan at a very lower rate ---thanks goes to the standard and stringent credit appraisal policy and practices of the bank.

Finally, Mutual Trust Bank has set its mission high enough: to provide high quality service to its customers, to participate in the growth and expansion of our national economy, to set high standards of integrity, to bring total satisfaction to its clients, shareholders and employees and to become the most sought after bank in the country, rendering technology driven innovative services by the dedicated team of professionals. The management of the bank is working continuously to make their mission a realizable one. Table of ContentTitlePage no.

Chapter-1Introduction

Background of the study.

Objective of the study.

Rational of the study.

Methodology

Limitation of the Study

02 08

Chapter-2Overview of Banking Sector in Bangladesh.

Banking Industry Analysis

Brief History of Banking in Bangladesh

Banking Sector in Bangladesh

10 12

Chapter-3Overview of Mutual Trust Bank Limited Brief History Of MTBL.

Mission / Vision of MTBL.

Depository Product of MTBL.

Source of Income of MTBL.

Overview Organizational Structure of MTBL. 14 26

Chapter-4Body of the Report. (Credit Management of MTBL).

Processing.

Credit Monitoring & Review.

Security against Advance.

Modes of Charging Security.

Lending Risk Analysis (LRA):Modern Technique of Credit Appraisal Overview Principles of Sound Lending Modern Concept of Good Lending. Credit Policy of Mutual Trust Bank Ltd. Global Credit Portfolio of MTBL. Types of Credit. Credit Approving Authority. Functions of Credit Department. Delegation of Credit Authority. Classification of Loan on the Basis of MTBL Securities. Objective basis Classification. Qualitative Judgment Basis of Classification. Managing Delinquent Client. Provisioning.

Credit Appraisal System.

Guiding Principles of Credit Appraisal for Credit Offer.

Steps Involved in CreditGuidelines for Credit Risk Management By Bangladesh Bank.

Procedural Guidelines Policy Guideline.

Credit Adjustment and Risk Grading.

Approval Authority.

Preferred Organizational Structure & Responsibility.Compliance Of Bangladesh Bank Guideline By Mutual Trust Bank Limited.

Credit Policies / Lending Guidelines.

Credit Adjustment & Risk Grading.

Approval Authority.

Segregation of Duties.

Internal Audit.

Preferred Organizational Structure & Approval Process.

Credit Administration & Monitoring.

Credit Recovery.

Analysis of Other Parameters.

CIB Checklist.

Acceptance in Risk Rating.

28 74

76-101103-109

Chapter5-

Chapter- 6Findings of The Study:

SWOT Analysis.

Regression Analysis.

Ratio Analysis of MTBL.

Recommendations & Conclusions

General recommendations.

Recommendations regarding Credit Management Strategies of MTBL.

Conclusion111 130132-136

Bibliography

137

Chapter 1(Introduction)

1.1 Origin of the Study

This internship report on Mutual Trust Bank Limited (Baridhara Branch) is prepared to fulfill the partial requirement of the internship program as full credit subject of the BBA program of The University.In Bangladesh today financial sector is one of the most established areas in the macro economic sector. Economy and finance is carrier of the country. So for the aspects of economic development, banking sector must be reformed. In the process of forming a good economic system, private banks are paling an important role compare to the government banks in the country. For this reason I prepared my internship report on Mutual Trust Bank Limited. 1.2 Rationality of the Study

Mutual Trust Bank Ltd has discovered a new horizon in the field of banking area, which offers different General Banking, Investments and Foreign Exchange Banking System. General Banking is one of the most important elements to do better or survive in the competition in the Banking Arena. So I have decided to study on the topic Problems and its Solutions of General Banking Activities in Mutual Trust Bank. Because the Internship Program of the university is an integral part of the BBA program. This also provides an opportunity to the students to minimize the gap between theoretical and practical knowledge. Students are required to work on a specific topic based on their theoretical and practical knowledge acquired during the period of the internship program and then submit it to the teacher. That is why I have prepared this report1.3 Objective of the Study

The Primary objective of the report is:

To fulfill the partial requirement of the internship program as a full credit subject of the BBA program. To know about the banking sector of Bangladesh.

To be accustom with the management policy or process of MTBL in Bangladesh. To get an overall idea about the management policy of MTBL as well as commercial Bank.The Secondary objective of the report is:

To know the operation of commercial banks in Bangladesh. To describe the customer service process of MTBL Bank Limited.

To analyze the barriers faced by the banks in Bangladesh. To suggest a supportive role in the progress of banking system in financial sector.

To know about the objectives and planning of MTBL.

To know how the branches are efficiently controlled.

To identify whether all process are perfectly and effectively practiced or not.

To find out the sectors in which such types of problems exist.

To make an opinion on the reports. 1.4 Scope of the Study

This report covered the over all banking system of JBL Bank Limited and also includes the relationship of the customers with the bank as well as the principals covered by the bank as a general banking system. 1.5 Sources of Data

Both primary and secondary data have been collected. I have gathered primary data by personal interview of the Executives of MTBL. Mainly I have discussed with them verbally. I collected information from them and the annual report of Mutual Trust Bank Limited that was provided by the Local Branch (Baridhara). I used journals, brochures, manuals and several books on Finance and Banking to prepare this report.

75% data collected from bank and articles, workshop and 25% are collected from the books as well as the information provided by the competitive banks.

That is for preparing the report smoothly and accurately I used primary data and secondary data. a) Primary Sources Direct interviews with relevant personnel.

Experts opinion

Official records of MTBL.b) Secondary Sources

Relevant paper and publications

Annual reports of MTBL.

Relevant books and references.1.6 Methodology of the Study 1.6.1 Research Design I followed descriptive studies and partially causal studies. It is descriptive studies because I covered the financial aspects of MTBL and causal studies because through more advertising and campaign sells of the products of Mutual Trust Bank Limited would be increased.1.6.2 Population

All the Branches of MTBL located in everywhere in Bangladesh has been taken into consideration as population.

1.6.3 Sample

Mutual Trust Bank Ltd, Baridhara Branchs Client is the vivacious sample. Employee of that branch is also sample of this report.1.7 Data Analysis Method

I analyzed the data to find out the required information. Ms-Word, Excel or any required computer program used to process the data. Quantitative data and based on this data analysis the final report was prepared. Interview is used as an instrument.1.8 Limitation of the Study It is an uphill task to study the on the management so the report was completed under certain constrains which were:

Difficulty in gaining accesses to financial sector.

Non-availability of the most recent statistical data.

As I am student it is not possible for me to collect all the necessary information.

I had to complete this report within a very short span of time that was not sufficient for investigation.

Lake of Experience.

Chapter 2(Overview of the Organization)2.1 Background of the OrganizationMutual Trust Bank Limited (MTBL) was incorporated on September 29, 1999 under the companies Act 1994 as a public company limited. They introduced themselves as a pioneer in banking sector. At the time of beginning their authorized capital was Tk 38, 00,000,000 divided into 38,000,000 ordinary shares of Tk each. The head office of the bank is in MTB center, 26 Gulshan Avenue. The bank has 67 branches allover the country, the bank carries out international business through a Global Network of Foreign Correspondent Banks.

The Company was also issued Certificate for Commencement of Business on the same day and was granted license on October 05, 1999 by Bangladesh Bank under the Banking Companies Act 1991 and started its banking operation on October 24, 1999The Company started its banking operation and entitled to carry out the following types of banking business:(i) All types of commercial banking activities including Money Market operations. (ii) Investment in Merchant Banking activities. (iii) Investment in Company activities. (iv) Financiers, Promoters, Capitalists etc. (v) Financial Intermediary Services. (vii) Any related Financial Services. 2.2 Corporate Slogan You can Bank on us2.3Mission The mission of the company is to assigned them as one of the most admired bank in the nation and also is recognized as an innovative and client focused company, enabled by cutting-edge technology, a dynamic workforce and a wide array of financial products and services2.4 Vision

Mutual Trust Banks vision is based on philosophy and known as MTB 3V. They imagine MTB in:

One of the best performing bank in Bangladesh

The bank of choice

A truly world class bank.

2.5 Branches

Aganagar Branch

Agrabad Branch

Alankar Mor Branch

Aman Bazar Branch

Babu Bazar Branch

Banani Branch

Baridhara Branch

Bashundhara City Branch

Bogra Branch

Jubilee Road Branch

Kerani Hat Branch

CDA Avenue Branch

Chandra Branch

Chawk Moghaltuli Branch

Chokoria Branch

Cox's Bazar Branch

Dhanmondi Branch

Dholaikhal Branch

Dhorkora Bazar Branch

Dilkusha Branch

Elephant Road Branch

Feni Branch

Fulbaria Branch

Gournadi Branch

Gulshan Branch

Habigonj Branch

Joypurhat Branch

Jubilee Road Branch

Kerani Hat Branch

Khatungonj Branch

Kushtia Branch

Madaripur Branch

Mohammadpur Branch

Moulvi Bazar Branch

MTB Centre Corporate Branch

Mymensingh Branch

Narayangonj Branch

Nazirhat Branch

Oxygen Mor Branch

Pabna Branch

Pallabi Branch

Panthapath Branch

Principal Branch

Progati Sarani Branch

Raipur Branch

Rajshahi Branch

Rangpur Branch

Savar Branch

Shanir Akhra Branch

Sonargaon Branch

Sreenagar Branch

Sylhet Branch

Tongi Branch

Uttara Model Town Branch

2.6 Management

MTBL is managed by highly professional people. The present Managing Director of the Bank Mr. Anis A Khan is a forward looking senior banker having decades of experience and multi discipline of knowledge to his credit both at home and abroad. He is supported by an educated and skilled professional team with diversified experience in finance and banking. The management of the bank constantly focuses on the understanding and anticipating customers needs and offer solution thereof. Mutual Trust Bank Limited has already achieved tremendous progress with in a short period of its operation. The Bank is already ranked as one of the quality service providers and known for its reputation. 2.7 MTBL Corporate Culture

Employees of MTBL share certain common values, which helps to create a MTBL culture.

The client comes first.

Search for professional excellence.

Openness to new ideas &new methods to encourage creativity.

Quick decision-making.

Flexibility and prompt responses. A sense of professional ethics.

2.8 Objectives

To earn and maintain CAMEL rating strong.

To establish relationship banking and service quality through development of Strategic Marketing Plan.

To remain one of the best banks in Bangladesh in terms of profitability and asset quality.

To introduce fully automated systems through integration of Information Technology.

To ensure an adequate rate of return on investment.

To keep risk position at an acceptable range (including any off balance sheet risks)

To maintain adequate liquidity to meet maturity obligations and commitments.

To maintain a healthy growth of business with desired image.

To maintain adequate control systems and transparency in procedures.

To develop and retain a quality work force through an effective Human Resources Management System.

To ensue optimum utilization of all available resources.

2.9 Strategies

To manage and operate the bank in the most efficient manner to enhance financial performance and to control cost of fund.

To strive for customer satisfaction through quality control and delivery of timely services.

To identify customers credits and other banking needs and monitor their perception towards our performance in meeting those requirements.

To revive and update policies, procedures and practices to enhance the ability to extend better services to customers.

To train and develop all employees and provide them adequate resources so that customers need can be responsibly addressed.

To promote organizational effectiveness by openly communicating company plans, policies, practices and procedures to all employees in a timely fashion.

To cultivate a working environment that fosters positive motivation for improved performance.

To diversify portfolio both in the retail and wholesale market.

2.10 Management Structure of Mutual Trust Bank Limited

2.11 Schemes Offered by Mutual Trust Bank1.( Brick by Brick Savings Scheme: Monthly Installment5 Years*8 Years*10 Years*

* The maturity value is an indicative figure. Tax/Excise Duty will be deducted as per govt. rules. 90% Loan Advantage on deposited amount. Thereafter in multiples of Tk. 5000 up to a limit of Tk. 100,000.

2.( MTB Monthly Benefit Plan:Deposit AmountIncome Amount for 3-year plan*Income Amount for 5-year plan*

* The maturity value is an indicative figure. Tax/Excise Duty will be deducted as per govt. rules. 90% Loan Advantage on deposited amount.

3.( Save Everyday Plan: Saving money for the future is a common practice in any society. Savings help you to build a better tomorrow. Regular saving makes a man become disciplined, self confident and successful.

MTBL offers you "Save Everyday" Plan. The primary advantage of this plan is that you are absolutely free to choose your own time for depositing money into this account. You can depositdaily, weekly or monthly. The choice is yours, but the transactions will have to be within the Bank's transaction hour.

This is a 5 year plan and you will be required to open the account with an initial deposit of Tk. 2500/= only. We offer you very attractive interest rate which is accrued in this account on a daily basis.

4.( MTB Education Plan: Monthly Installment4 Years*7 Years*9 Years*

* The maturity value is an indicative figure. Tax/Excise Duty will be deducted as per govt. rules. 90% Loan Advantage on deposited amount.

5.( Consumer Credit Scheme:In order to make a significant contribution in the living standards of the people of medium and low income category, MTBL has introduced a scheme called "Consumer Credit Scheme". With a view to materialize the dreams of those who are unable to make one time investment from their own savings, one can now afford to buy necessary household equipments and thus improve the standard of living.

All sorts of household durables e.g. Television, Refrigerators, Computers, Air Conditioners, Video Cameras, Washing/ Drying Machines and Furnitures are allowed under this scheme. One can buy Motorcycle too under this program. The collateral security is minimum and the interest rates are one of the lowest in the market. Please contact the nearest branch for details.

6.( Best Invest: Best Invest offers you efficient high return investment plan. This plan helps you to build up a sizeable income in easy and affordable installments. This plan allows you to own 5 times the initial invested amount. Best Invest offers two separate and convenient term deposit periods for 4 years and 6 years respectively. Best Invest is available in units worth Tk.50, 000/- each. You will invest Tk.10, 000/- as down payment for purchasing 1 (one) unit and the Bank will provide loan for Tk.40, 000/-. The customer also has the option to buy units in multiples of Tk. 50,000/- but maximum up to Tk. 1, 00, 00,000/- (one core).Chapter 3(General Banking)

3.1 General BankingGeneral Banking is the starting point of all the banking operating. General Banking department aids in taking deposits and simultaneously provides some ancillaries services. It provides those customers who come frequently and those customers who come one time in banking for enjoying additional services. In some general banking department there is no relation between banker and customers but on the other hand there are some departments where a banker has to do frequent interaction with customer. This the department from which a customer can get day-to-day service from bank. It opens new accounts, demit funds, issue bank drafts and pay orders etc. since bank in confined to provide the service everyday general banking is also known as retail banking. 3.2 Sections of General Banking

Basically general banking consists of many sections. In Baridhara branch general banking consists the following sections:

1. Customer Service

2. Account opening or closing

3. Remittance

Pay order issue

Demand draft issue/collection

TT/issue collection

4. Deposit department

5. Locker service

6. Accounts department3.3 Customer service of Mutual Trust BankCustomer satisfaction is MTBLs first priority. They believe in mutual trust with customer. A satisfied client is MTBL precious product. To satisfy its customer MTBL appoints the most professional and customer caring employees, because professional merit and competency, flexibility, determination and dedication are the core resources that MTBL consider to be of paramount importance for building a client oriented modern banking.

3.4 Types of Accounts3.4.1 Current AccountCurrent accounts can open jointly or singly. It may be a proprietorship account or limited company account. Here the interest rate is 0%.

3.4.2 Savings Account

Savings account can be joint or single. Here the interest rate is 6.25%.3.4.3 Short Term Deposit

It also is joint or single account and the interest rate is 6.00%.

3.4.4 Fixed DepositFixed deposit is one, which is repayable after the expiry of a predetermined period fixed by him. The period varies form 1 month to 12 months. These deposits are not repayable on demand but they are withdrawal subject to a period of notice. Hence, it is a popularly known as Time Deposit or Time Liabilities. Normally the money on a fixed deposit is not repayable before the expiry of a fixed period.3.5 Customized Products of MTBL

3.5.1 MTB Double Saver Plan:Deposit AmountMaturity Value after 6 Years. The maturity value is an indicative figure. Tax/Excise Duty will be deducted as per Govt. rules. 90% Loan Advantage on deposited amount.

3.5.2 MTB Triple Saver Plan:Deposit AmountMaturity Value after 11 Years. The maturity value is an indicative figure. Tax/Excise Duty will be deducted as per govt. rules. 90% Loan Advantage on deposited amount.

3.5.3 MTB Millionaire Plan:Monthly InstallmentYearMaturity Value. The maturity value is an indicative figure. Tax/Excise Duty will be deducted as per govt. rules. 90% Loan Advantage on deposited amount.

3.5.4 MTB Unique Savings Plan: Unique Savings Plan is an any day, any amount savings plan. The beauty of this plan is that a customer can deposit any day, any time and any amountUnique Savings Plan offers you to deposit any amount of your choice but not less than Tk. 500/- for 3/4/5 years. This is a high income plan with withdrawal facilities. The withdrawal facility will help you at the time of any emergency. You can withdraw 50% of the deposited balance for once a month. At maturity you will get a handsome amount.

3.6 Procedure for Accounting Opening Opening account with a bank is the way of creating a banker customer relationship. In other words, it is a contract between banker and customer. With this contract, bankers enter into certain obligations and responsibilities. Proper introduction serves as a precaution against fraud and forgeries and safeguard against inadvertent overdraft to bank. Obtaining proper introduction may absolve the banker from the charges of negligence for conversion. So, while opening a new account, emphasis would be given without exception to introductory reference and inquiry.The following instruction to be followed while opening an account:

Introduction of Account to be obtained from a respectable client acceptable to bank.

The introduction shall be obtained in writing in the respective column of Account opening form.

For opening savings bank account of individual either singly or jointly, passports and identity cards may be accepted for introduction, but subsequently proper introduction may be obtained.

Introduction of Current Account by members of the staff may be allowed but shall be discouraged as far as possible.

Current Account shall preferably be introduced by another Current Account holder acceptable to bank.

Introduction of Account holder of other branch may be accepted with caution. In that case the introducers signature must be verified by authorized officer of that branch and authenticated by a forwarding letter.

Photographs of account holder must be attested by the introducer.

Letter of thanks be issued to introducer in Banks standard specimen.3.6.1 Current Account

I. A Current Deposit Account may be opened by individual, firm, company and club, association, body corporate etc.

II. Funds in the Current Deposit Account is payable on demand.

III. No interest is payable on balances of Current Deposit Accounts.

IV. Minimum balance to be maintained in the account is Tk.1,500/-

V. Customer willing to open Current Deposit Account shall fill up the Account Opening Form (AOF) applicable to him/ her and Specimen Signature Card (SS Card).

VI. In case of proprietorship and partnership firms the relevant account opening form is to be filled in and signed by the proprietor/ partner in their individual capacity. In all other cases including companies etc. Introduction of acceptable clients to be obtained as per guidelines.

VII. The Managers approval for opening account shall be obtained by the concerned staff member.

VIII. Signatures of the account holder shall be admitted by affixing the stamp Signature admitted and signing by the authorized officer. The introducers signature shall be verified by affixing the stamp Signature verified near the signature by authorized officer.

IX. Blank space of the Specimen Signature Card should be closed by drawing parallel lines.

X. The particulars of the Account Opening Form shall be entered in the Account Opened and Closed Register as per sequence provided by the computer system.

XI. The customer shall be provided with Deposit Slip in comporting the Account Number and be advised to make the initial deposit in the account. The amount of initial deposit shall be entered in the Account Opening Form.

XII. Cheque Book shall be issued on request on completion of all formalities including initial deposit. Cheque series to be entered in the Account Opening Form at the bottom right and authenticated by authorized officer.

XIII. After posting of all particulars of the account including cheque series, one authorized officer shall check/ verify the same in the computer screen and record it in the form with signature.

XIV. Manager/ Authorized Officer shall apply sufficient intelligence and common sense to ascertain genuineness of the account holder. No account shall be opened without approval of the Manager.

XV. Clear instruction regarding operation of the account shall be noted on the Account Opening Form and Specimen Signature Card especially in respect of death of inability of the account holders, or the person operating the account. The account holder shall confirm the instructions under specimen signature.

XVI. The account opening form shall be sent to the respective computer terminal for posting and S.S. Card shall be retained serially in the S.S. Card Box under custody of Cheque Passing Officer.

XVII. One of the photographs of the Account Holder is to be pasted with AOF and another one with S.S. Card. AOF to be retained in serial order in Pasting File.

XVIII. A letter of thanks to be sent to the account holder as well as to the introducer.

XIX. All new accounts opened during the day shall be personally checked by the Manager at the close of business of each day.

XX. Checking officer shall particularly see the introduction, initial deposit in cash or cheque, nature of business of the account holder, Trade License, Partnership Deed/ Memorandum of Articles of Association, Resolution etc.

XXI. Similar Accounts should be noted in the AOF and care should be taken while making posting of transactions in such accounts.

XXII. The Computer Program used by bank shall provide reference of clients. Branch Manager must ensure that their computer system provides reference of client.

XXIII. Classified Deposit Ownership Program to be maintained in the Computer System for facilitating periodical returns to Bangladesh Bank.

XXIV. Bank shall provide monthly statement of account to clients as per computer system of the branch.3.6.2 Savings Account I. Savings Bank Account may be opened in the name of adult individual who are mentally sound and also jointly in the names of two or more persons payable to either or both or all of them or to the survivor or survivors.

II. Savings Bank Account may be opened in the name of a minor also.

III. Saving Bank Account may be opened in the names of clubs, societies, association and similar institutions and even by government and semi-government offices.

IV. Account shall be opened with at-least a minimum initial deposit of Tk.1, 000/-.

V. Interest at the rates fixed by Head Office from time to time is applied half-yearly on the balances held on daily product basis.

VI. Not more than one account is allowed to be opened in the same name. But this will not be applicable to parents willing to open more than one account in his/ her name in respect of each minor child.

VII. Savings Bank Account shall not be allowed to be overdrawn under any circumstances.

VIII. Account opening formalities like Current Account should be followed.

IX. Savings Bank Account should not be allowed to be operated like Current Account

X. No interest shall be paid to such accounts in the month for violation of the above rules.

XI. Bank shall provide monthly-computerized statement of accounts to account holders instead of passbook.

XII. Bank may at its discretion close any account with prior notice for repeated return of cheque due to insufficient balance.3.6.3 Checklist of Documents to be obtained for various types of ACCOUNTS3.6.3.1 Sole Proprietorship

1.Signature Card.2.Photograph of signatories attested by introducer.3.Copy of valid Trade License.4.TIN Certificate.5.18-permission from Bangladesh Bank (for GSA & Agents only).3.6.3.2 Partnership

1.Signature Card.2.Photography of signatories attested by introducer.3.Partnership Deed.4.Partners letter of authority to open account and authorization for operation.5.Copy of valid Trade License.6.18-permission from Bangladesh Bank (for GSA & Agents only).3.6.3.3 Limited Liability Company

1. Signature Card.2.Photograph of signatories attested by introducer.3.Copy of Memorandum and Articles of Association (Certified by RJSC).4.Copy of Certificate of Incorporation and commencement of business (In case of public Ltd. Co.).5.Copy of Board Resolution to open the account and authorization for operation.6.List of Directors and signatories along with addresses.7.Latest copy of From XII.3.6.3.4 Association/Trust/Society

1.Signature Card.2.Photograph of signatories attested by introducer.3.Copy of Resolution of governing body to open the account and authorization for operation. 4.Copy of consolation / bylaws/ rules. 5.Certificate of registration.6.List of authorized signatories and members of the governing bodies along with address.7.Trust Deed (for Trust account only).3.7 Interest Posting to Clients AccountBangladesh Government has circulated that, 10% deduction from the Banks Internal Accounts. This 10% tax deduction from the clients interest.

Other wise another circulation is that, from the OBC collection every bank cut off there OBC commission as income account, here Bangladesh Bank said that 15% money cut off from the OBC collection as Vat on Others.3.8 Cheque Book Issue

3.8.1 Types of Cheque Books

Savings Account 10 Leaves Current Deposit Account 10 Leaves Current Deposit Account 25 Leaves (CDTF) Current Deposit Account 50 Leaves (CDF) CDF: Current Deposit Fifty NB: CDTF: Current Deposit Twenty Five

3.8.2 Issuing Process

There are two ways of issuing cheque books. They are direct requisition slip and cheque book requisition slip. Customers Service Officer receives these types of slip from the clients and gives the cheque books under processing. Processing means Cheque Books collect from the VOLT and the put account number in the Cheque book, write down the serial number of the cheque book in the requisition slip and cheque book register, then Verified client signature. After all this things the Principal officer sign in the cheque leaves and sent the cheque book to another Principal officer for sign, after his sign the client receive the cheque book. These things the Principal Officer for sign, after his sign the client receive the cheque book. Then Principal Officer posting that cheque books leaves number in the computer data processing system.

A cover file containing the requisition slip is effectively preserved as vouchers. If any defect is noticed by the ledger keeper, he makes a remark to that effect on the requisition slip and forward it to the cancellation officer to decide whether a new checkbook to be issued to the customer or not.3.8.3 Cash Cheque I. The cheque is drawn on the bank and branch where it is presented for payment.

II. The cheque is an open cheque i.e. uncrossed.

III. In case it is an order cheque (Payable in cash) the payee is identified to satisfaction.

IV. It is not post-dated, undated or stale.

V. The words and figures tally.

VI. The cheque is duly signed by the drawers.

VII. Cuttings and alteration have been authenticated under full signature of the drawer.

VIII. There is no over writing whatsoever.

IX. Any material part of the cheque is not mutilated.

X. The cheque is not unusually of huge amount and also with-drawl is not rare and sudden. In such cases the matter should be brought to the notice of the Manager by the posting officer.

XI. The cheque leave bears the initial of cheque book issuing officer.

3.8.4 Cash Debit Voucher

In case of cash debit voucher, the following points should be checked:

I. It is signed by the authorized officer along with the Manager.

II. It is signed by the payee on the reverse and payees signature is verified.

III. It bears the Stamp Pay Cash.3.8.5 Clearing Cheque

In case of clearing cheque, it is checked that: -

I. Collecting Banks Clearing Stamp bearing correct date is affixed on the face of the cheque and the cheque is presented in the 1st or 2nd clearing as stamped.

II. The collecting banks discharge is correct.

III. Other points similar to those as explained above are followed.

3.8.6 Transfer Delivery

The following points to be checked:-

I. The Transfer Delivery Stamp is affixed on the face of the cheque and bears correct date.

II. The collecting banks discharge is correct.

III. Other points similar to those explained above are followed.

3.8.7 Cash Transfer

It shall be checked that: -

I. The Cash Transfer Stamp is affixed on the face of the cheque.

II. Branch discharge is correct.III. Branch crossing seal is applied.IV. Other points similar to explain above are followed.3.8.8 VoucherIt shall be checked that: -

I. It is correctly written and dated.

II. Two attorney holders sign it jointly.III. Amount in words and figures tallies.IV. Appropriate head of account is given together with computer number.3.8.9 Cancellation of Cheque

I. The cancellation officer should be an authorized officer of the bank/ branch.

II. He/ She shall keep all Specimen Signature Card under his effective control during transaction hours.

III. The cancellation officer shall retain only the signature cards admitted by the authorized officer in serial order.

IV. Before passing any cheque, the signature of the drawer must be verified. In case, signature of the drawer differs, cheque shall not be passed unless the drawers confirmation is obtained or a reference is made to Manager for his instruction.

V. The cancellation officer shall not pass any cheque unless cheque is posted in the computer system.

VI. He/ she should check the irregularities of the cheque if any.

VII. The cheque series number with Prefix should be checked to safeguard fraud and forgeries.

VIII. The cancellation shall be done by drawing a redline across the signature of the drawer of the cheque. He/ She shall sign in full in red ink near the drawers signature.

IX. Cheque over Tk.50, 000/- shall be cancelled by two authorized officers jointly. Branch must issue office order regarding cheque passing schedule according to its size and volume of work load. The cancellation officer shall follow the schedule in variably.

X. In case of cash payment cheque a Pay Cash stamp shall be affixed on the cheque and signed by the cancellation officer.3.8.10 Payment of Cheque after Banking Hours

Payment of cheque after banking hours should be discouraged. Payment to the drawer only may be made in special cases as deemed by the Manager. The cheque should be paid after ascertaining sufficient balance in the account and on completion of other formalities.

However, such cheque should bear date of actual payment or prior to that date.

3.9 Account Closing

Fixed deposit A/C is closed after the termination of the period.Brick by Brick A/C is very easily closing if one of the clients didnt pay his/her monthly installment at the bank three months one after one, in this way three months. Another accounts will be closed on the parties advice, if they want to close any one of the account clients must have to submit an A/C closing letter through des pass. Then the Sr. Principal Officer checks it out and closes the A/C.3.9.1 Closing process for current & savings A/C:

After receiving customers application the officer verifies the balance of the A/C. He then calculates interest and other charges accumulated on the A/C.If it bears a credit balance, the officer writes advice voucher. He gives necessary accounting entries post to accounts section. The balance is returned to the customer. And lastly the A/C is closed.

But in practice, normally the customers dont close A/C willingly. At times, customers dont maintain any transaction for long time. Is this situation at first, the A/C becomes dormant and ultimately it is closed by the bank.Chapter 4

(Remittance)

4.1 Remittance

Remittance of funds is ancillary services of MTBL. It aids to remit fund from one place to another place on behalf of its customers as well as non- customers of bank. MTBL has its branches in the major cities of the country and therefore, it serves as one of the best mediums for remittance of funds from one place to another.

The main instruments used by MTBL, Dilkusha Branch for remittance of funds.

Payment Order Issue/CollectionDemand Draft Issue/CollectionT.T. Issue/CollectionEndorsementsTravelers Cheque IssuanceIBC/OBC Collection.

4.2 Payment Order Issue/Collection:The pay order is an instrument issued by bank, instructing itself a certain amount of money mentioned in the instrument taking amount of money and commission when it is presented in bank. Only the branch of the bank that has issued it will make the payment of pay order.

4.3 Issuing of Pay Order:

The procedures for issuing a Pay Order are as follows: Deposit money by the customer along with application form.Give necessary entry in the bills payable (Pay Order) register where payees name, date, PO no, etc is mentioned.prepared the instrument. after scrutinizing and approval of the instrument by the authority, it is delivered to customer. Signature of customer is taken on the counterpart.

4.4 Different modes of PO when a customer can purchase:

By cash: Cash A/CDebitBills payable (PO) A/CCredit.Income on commission A/CCredit.By account: Customers A/CDebitBills payable (PO) A/CCredit.Income on commission A/CCredit.By transfer: MTBL General/ other Dept Clients A/CDebitBills payable (PO) A/CCredit.Income on commission A/CCredit.PO A/C is the current liabilities of bank, which is acquired to be discharged by beneficiaries against cash or through an account.

4.5 Settlement of a PO:

When PO submitted by collecting bank through clearing house, the issuing bank gives payment.

Bills payable (PO) A/CDebit MTBL General A/CCredit.

But before giving payment it is duty for issuing to observe whether endorsement was given by the collecting bank or not, then the instrument is dishonored and marking Endorsement required.

4.6 Cancellation of a Pay Order:

If a buyer wants to cancel it, he should submit a letter of instrument in this regard and also return the instrument.

4.7 When PO is LostThe person intending to remit the money through a Demand Draft (DD) has to deposit the money to be remitted with the commission which the banker charges for its services. The amount of commission depends on the amount to be remitted. On issue of the DD, the remitter does not remain a party to the instrument: I) Drawer branch

ii) Drawee branch

iii) Payee.

This is treated as the current liability of the bank as the banker on the presentation of the instrument should pay the money. The banker event on receiving instructions from the remitter cannot stop the payment of the instrument. Stop payment can be done in the following cases:

Loss of draft before endorsement: In this case, Draft reported to be lost, payees endorsement requires verification is marked.Loss of draft after endorsement: In this case, the( branch first satisfies itself about the claimant and the endorsement in his favor. 4.8 Demand Draft Issue/Collection

The person intending to remit the money through a Demand Draft (DD) has to deposit the money to be remitted with the commission which the banker charges for its services. The amount of commission depends on the amount to be remitted. On issue of the DD, the remitter does not remain a party to the instrument: i) Drawer branch ii) Drawee branch iii) Payee. This is treated as the current liability of the bank as the banker on the presentation of the instrument should pay the money. The banker event on receiving instructions from the remitter cannot stop the payment of the instrument. Stop payment can be done in the following cases: the branch first satisfies itself about the claimant and the endorsement in his favor. Loss of draft before endorsement: In this case, Draft reported to be lost, payees endorsement requires verification is marked. Loss of draft after endorsement: In this case the branch first satisfies itself about the claimant and the endorsement in his favor. Accounting treatment

Cash/ customers A/C---------------------Dr.MTBL General A/C (Drawn on branch)----------Cr. Income A/C commission---------------------------Cr.

After giving these entries an Inter Bank Credit Advice is prepared which contains the controlling number, depicting that the branch is credited to whom it is issued. An IBCA implies the following entries,

MTBL General A/C Issuing Branch -------Dr. Drawn on branch------------------------------------Cr. 4.9 Role of Drawn Branch

After receiving the IBCA lodgment is done by the branch. The following entries are given DD In-Issuing branch register:

Issuing branch A/C-------------------------Dr. Bills Payable ---------------------------------------Cr. (After receiving an IBCA) Bills Payable (DD) A/C--------------------Dr. Clients A/C--------------------------------Dr.

Entries are given in DD In-Issuing branch register:

Issuing branch A/C-----------------------Dr. Bills Payable---------------------------------------Cr. (After receiving an IBCA)Bills Payable (DD) A/C------------------Dr. Clients A/C------------------------------Dr. 4.10Charges

A commission of 0.15% is taken on the draft value & Tk.50/= is taken as postal charge.4.11Cancellation

To cancel an issued DD, the client has to submit an application. Issuing branch then sends an Inter Branch Debit Advice (IBDA) to the drawn branch against previously issued IBCA.

After that the following entries are given:

General A/C drawn on branch---------Dr.Clients A/C ---------------------------------------Cr.4.12 Issuing of Duplicate DDIf the customer wants to issue a duplicate DD, than customer is asked to do the following formalities: Making a general diary (GD) in the nearest Police Station.Furnishing an Indemnity Bond in Tk.50/= stamp. The banker immediately marks stop payment in the register after receiving the application from the customer and a duplicate DD is issued.4.13 Issuing of duplicate PO I. In addition to obtaining application from the purchaser, a confirmation should also be obtained from the beneficiary to the effect that the instrument has been lost or not received by him/them.

II. Head Office is informed regarding loss of the P.O. for circulation to the branches.

III. An indemnity bond affixed with special adhesive stamp of Tk.150/- is obtained from the applicant.

IV. A note to this effect is made on the original application form and the Pay-Order Issued Register.

V. The indemnity bond is kept in the "Indemnity Bonds for duplicate instruments issued file."

VI. The Pay Order is issued marked Duplicate in Red Ink.

Chapter 5

(Accounts Department) 5.1 Accounts Department

Accounts Department is play most vital role in Banking. Accounts Department is a department with which each and every department is related. It records the profit & loss A/C and statement of assets and liabilities by applying Golden Rules of book-keeping. The functions of it are theoretical & computerized based. MTBL Baridhara Branch records its accounts daily, weekly, and monthly every record. This entire executives helps me a lot in my internship program at MTBL. They didnt guide me as an Internee; they guide me as a training officer of MTBL to gather practical knowledge about Banking. They tried there best to inform me every thing about accounts department. I hope I knew every thing that gave me as a new comer in banking sector.The accounts department has the following sectors:

Cash

Transfer

Clearing5.2 Cash

Mr. MD Alamgir Kabir and Miss Shamima Sulatana is the cash in charge. Both of the two senior executives helps me lot to get practical knowledge and prepare this report. The cash section of any branch plays very significant role in Accounts Department. Because, it deals with most liquid assets the MTBL Baridhara Branch has an equipped cash section. This section receives cash from depositors and pays cash against cheque draft, PO, and pay in slip over the counter. Every bank must have a cash counter where customer withdrawn and deposit there money. When the valued clients deposit their money at the cash counter they must have to full fill the deposit slip his/her own, then they sing as the depositor options then they deposit their money through cash officer at the cash counter.

5.3 Several Types of Deposit Slip

There are several types of deposit slip. They are as follows

Current Deposit A/C Slip

Savings Deposit A/C Slip

Brick by Brick Deposit A/C Slip

Pay Order Slip

Demand Draft Slip

After paying this kinds of slip, the valued client waits for the deposit slip book out side of the cash counter. The cash officer deposit the money in there account through computer software, while the depositors account credited, then the cash officer put a seal in the deposit slip and return it to the clients.5.4 Receiving Cash

Any people who want to deposit money will fill up the deposit slip and give the form along with the money to the cash officer over the counter. The cash officer counts the cash and compares with the figure written in the deposit slip. Then he put his signature on the slip along with the cash received seal and records in the cash receive register book against A/C number. At the end of the procedure, the cash officer passes the deposit slip to the counter section for posting purpose and delivers duplicate slip to the clients.

Account treatment: Cash A/C---------------------Dr. Customers A/C-------------Cr.5.5 Disbursing CashThe drawn who wants to receive money against cheque comes to the payment counter and presents his cheque to the officer. He verifies the following information:

Date of the cheque

Signature of the A/C holder

Material alteration

Whether the cheque is crossed or not

Whether the cheque is endorsed or not Whether the amount in figure and in word correspondent or notThen he checks the cheque from computer for further verification. Here the following information is checked:

whether there is sufficient balance or notwhether there is stop payment instruction or notwhether there is any legal obstruction (Garnishee Order) or not

After checking everything, if all are in order the cash officer gives amount to the holder and records in the paid register.

Account treatment: Customers A/CDr.Cash A/CCr.

The cash section of MTBL deals with all types of negotiable instruments, cash and other instruments and treated as a sensitive section of the bank. It includes the vault which is used as the store of cash instruments. The vault is insured up to Tk. 60 lacs. If the cash stock goes beyond this limit, the excess cash is then transferred to Principle Branch Office. When the excess cash is transferred to MTBL Principle Branch Office the cash officer issues IBDA.

Account treatment: MTBL General A/CDr.Cash A/CCr.

When cash is brought from MTBL Principle Branch Office.

Accounting treatment: Cash A/CDr.MTBL General A/CCr.5.6 Transfer

Transfer is not a critical sector in banking but it is very important. Transfers play a vital role in banking sector. So now we have to know what transfer is: basically transfer is a type of register maintaining matter. In this register officer write down every day transactions in Debit and Credit side then the officer calculate both the side of the register if both side shown same amount, it means that the total days transaction is completely okay.5.7 Clearing

Clearing is one of the magical parts of banking. I really enjoyed this part of the accounts department and banking sector. In Bangladesh Bank, there is a very large room, which contains fifty (50) or more tables for each bank that is called the clearing house. There are two types of clearing house. They are:

I. 1st Clearing House

II. Return Clearing House

5.8 Clearing House Process Every bank has an officer of clearinghouse who is work with Bangladesh Bank clearing house. Actually most of major client deposit their account in different kinds of bank cheque. Clearing officer check all the cheque and deposit slip very carefully and then he received the cheque. After that the clearing officer posting all the cheque in computer software which is recognized through Bangladesh bank computer department. Then clearing officer seal all the cheque in advance date after that the officer endorsement all the cheque and sign all the cheque. All the cheque are posted in the computer by branch wise, then officer print the entire document and staple all the cheque by branch wise this is called schedule of clearing house. It is a very difficult job to staple all the cheque, because some times the cheque are huge in quantity, it may be 250 to 400, this is very vital job because every cheque must have to staple very carefully, it means cheque amount and the print sheet amount and cheque branch must have to be same. If the cheque staple in wrong direction, the cheque may be return from another bank, thats why MTBL not to be able to credited party account.

Then the clearinghouse officer copying the entire document in two floppy dist as per Bangladesh Bank requirement. When the clearing officers enter the clearinghouse, his first job is that the floppy delivered to the Bangladesh Bank computer department.

All of the procedure the clearing in charge goes to the Bangladesh Bank clearing house before 10 am in the morning. The clearing officer check all the banks cheque and he put all the cheque in bank wise, like as this another banks delivered there cheque in MTBL desk. Then the officers of MTBL have to calculate all the cheque by using calculator machine, Staple pin remover, and then he divided all the cheque MTBL Branch wise. 5.9 Types of Clearing Cheque There are two types of clearing cheque. They are

1. Inward Clearing Cheque2. Outward Clearing Cheque

5.9.1 Inward Clearing Cheque

Inward cheque are those ones drawn the respective branch which have been presented on other banks and will be cleared / honored through the clearing house of Bangladesh Bank. Then the cheque is called inward cheque.Accounting treatment:Customers A/C Debit.MTBL General A/c credit5.9.2 Outward Clearing Cheque

Outward cheque is those ones drawn on other bank branches which are presented on the concerned branch for collection through clearing house of Bangladesh Bank. This cheque is called outward clearing cheque.5.10 Functions Provided by Clearing Department Like all other Banks, in MTBL Accounts Department is regarded as the nerve Center of the bank. In banking business, transactions are done every day and these transactions are to be recorded properly and systematically as the banks deal with the depositors money. Any deviation in proper recording may hamper public confidence and the bank has to suffer a lot otherwise. Improper recording of transactions will lead to the mismatch in the debit side and in the credit side. To avoid these mishaps, the bank provides a separate department whose function is to check the mistakes in passing vouchers or wrong entries or fraud or forgery. This department is called as Accounts Department.

Besides the above, the Bank has to prepare some internal statements as well as some statutory statements which are to be submitted to the central bank. Accounts Department prepares these statements also. The department has to submit some statements to the Head Office, which is also consolidated by the Head Office late on.

The tasks of the Accounts Department of MTBL Baridhara Branch may be seen in two different angles: Daily Tasks

Periodical Tasks

5.10.1 Daily Tasks The routine daily tasks of the accounts department are as follows:

Recording the daily transaction in the cash book Recording the daily transaction in general and subsidiary ledger

Preparing the daily position of the branch comprising of deposit and cash.

Preparing the daily Statement of Affairs showing all the assets and liability of the branch as per General Ledger and Subsidiary Ledger separately.

Making payment of all the expenses of the Branch. Recording inter branch fund transfer and providing accounting treatment in this regard. Checking whether all the vouchers are correctly passed to ensure the conformity with the Activity Report; if otherwise making it correct by calling the respective official to rectify the voucher.

Recording of the vouchers in the Voucher Register Packing of the correct vouchers according to the debit voucher and the credit voucher.5.10.2 Periodical Tasks Preparing the monthly salary statements for the employees Publishing the basic data of the branch.

Preparing the weekly position for the branch which is sent to the Head Office to maintain Cash Reserve Requirement (C.R.R).

Preparing the monthly position for the branch which is sent to the Head Office to maintain Statutory Liquidity Requirement (C.R.R).

Preparing the weekly position for the branch comprising of the break up of sector-wise deposit, credit etc. Preparing the weekly position for the branch comprising of the denomination wise statement of cash in tills. Preparing the quarterly statements (SBS-2 and SBS-3) where SBS-2 shows classification of deposits excluding inter bank deposits, deposits under wage earners scheme and withdrawals from deposits accounts and SBS-3 shows classification of advances (excluding inter bank) and classification of bills purchased and discounted during the quarter.

Preparing the budget for the branch by fixing the target regarding profit and deposit so as to take necessary steps to generate and mobilize deposit.

Preparing an Extract which is a summary of all the transactions of the Head Office account with the branch to reconcile all the transaction held among the accounts of all the branches.Chapter 6(Analysis and Interpretation)

While doing my internship at Mutual Trust Bank Ltd, Baridhara Branch, I got the chance to work with Customer Service Division or general banking, Cash, and Clearing. Whatever I have found from that experience are listed below: As MTBL, Baridhara Branch is a new branch so they are trying very hard to gain maximum customer satisfaction by giving well customer service. But for the shortage of officer in the font desk, customer and work pressure is very high and sometime customers are not getting everything at the exact time. For that reason some customer may be discouraged.

Deposit per employee measures the amount of long-term fund per employee. Deposit per employee consistently increased over the years with a positive trend indicating overall efficiency of the bank. Theoretically any person can purchase pay order, demand draft and telex transfer by depositing money and commission. But the person who wants to purchase these should have account in the bank branch. These will discourage customers to transact with bank. In opening A/C some additional documents are needed as compared with theoretical record. Like trade license, member of Dhaka chamber of commerce and industry (DCCL) in Dhaka city. Again some documents are not essential practically as referred in theory. For example, the photo of the person who will open A/C, and sometime introducer. There is a rule to deposit at least an amount of money in case of opening an account. But it is not strictly followed. Sometimes more money is asked from a new customer who discourages him to open an account in the bank.

When a client try to open an A/C he must have to need an introducer, sometime it may create a problems for the clients, most of the times this rules are not followed. The degree of relationship between banker and customer determines how much theory is deviated from practical work There are lots of problem regarding ATM card. Because MTBL uses the ATM booth of DBBL, very recently they launch their ATM booth but it is not enough for a huge number of customer groups of MTBL. They have only three booths in Dhaka city and no booth outside of Dhaka.

Most of the time customers enter their debit card in the machine but they dont get any money but their balance has been credited from the account.

Another problem regarding debit card is captured card. Under accounts department, practice strictly supports theories. There is not too much discrepancy between them. All the functions of Account Department provided by MTBL Baridhara Branch are based on accounting theories and procedures.

In case of depreciation only the straight-line is to be followed, but there are other methods of charging depreciation, such as-double decline, sum year-digit methods etc are used as method of depreciation. These are not followed by MTBL except the straight line method.

Accounts department plays a vital role in the management information system. Management collects different types of information from this department. There are only two cash officer in the cash section, sometimes customer has to wait a long time to deposit or withdraw money.

MTBL tries to give training to its employees but it is not enough.

In case of foreign remittance MTBL Baridhara branch only operate through Money Gram and some UAE exchange house.

Chapter 7

(Findings)

After analysis and interpret all the issues regarding problems of general banking activities I have found some problems which is mentioned bellow:

Shortage of front desk officer. Problems in purchasing pay order, demand draft and telex transfer. Imbalance in the account opening process between traditionally and theoretically. There is a rule of depositing a minimum amount of money for opening a new account sometimes which creates problem as the amount vary from customer to customer. Problems of introducer.

Problem regarding ATM card and machine

Shortage of employees in accounts department.

Problems regarding foreign remittance.

Lack of training.

Chapter 8 (Recommendation & Conclusion)

Recommendation The authority should recruit more employees to serve the customers. They can recruit experienced employee as well as fresh graduate.

The bank should introduce more products based on the market demand.

The bank should reduce their minimum balance to attract more customers. The salary of the worker need to be rise, as a result experienced people from other bank will be attract to join Mutual Trust Bank Limited.

Mutual Trust Limited should offer international credit card, because in modern world the use of increasing paper currencies is decreasing.

The bank can open more branches to reach to more customers. The bank can open branches or foreign booth because many people send money from abroad every year to Bangladesh. The bank should finance to the consumer goods, because many people in the country wants to buy consumer goods from bank loan.

The marketing department of the bank should more efficient to reach at the hart of the customer. The bank should be more profit concern as well as took part to the economics development of the country.

The departments of the bank should more efficient to make profit by satisfying customers.

The bank should use printed instruments like cheque, pay orders etc. Being a clear transparent the bank can provide the best support to the customer as earn profit. The bank should solve the problems regarding ATM card because it causes an embarrassing situation for the employee in front of customers.

Mutual Trust Bank should appoint new employees so that the problem of shortage of employees like Baridhara Branch will be removed and also the new comers will get the chance to serve very effectively.

MTBL should arrange a lot of training schedules, seminars and workshops for its existing employees to make them more effective and efficient.

Mutual Trust Bank should make connect with other money exchange like western union, UK exchange to get more foreign remittance through themConclusionAs an organization the Mutual Trust Bank Limited has earned the reputation of top banking operation in Bangladesh. The organization is much more structured compared to any other bank operating local or foreign in Bangladesh. It is relentless in pursuit of business innovation and improvement. It has a reputation as a partner of consumer growth.

With a bulk of qualified and experienced human resource, Mutual Trust Bank Limited can exploit any opportunity in the banking sector. It is pioneer in introducing many new products and services in the banking sector of the country. Moreover, in the overall-banking sector, it is unmatched with any other banks because of its wide spread branch networking thought the country.

This report tries to figure out most of the indicators of problems and strengths of Mutual Trust Bank Limited as a valid pretender in the competitive banking sector of Bangladesh. A severe cut throat competition is going on currently in this sector and thats why Mutual Trust Bank Limited has to work out with different dimensions like product diversification, market forecasting, proactive activities undertaken by Mutual Trust Bank Limited and some suggestion to get rid of the predicaments that exist.

.BibliographyMutual Trust Bank Limited, Annual Report 2009Mutual Trust Bank Limited, General Banking Manual.http://www.mutualtrustbankbd.com http://www.google.comRagman, A.A.M. Habitu, Islamic Banking, 1st edition, Dhaka, April, 2001.

Gordon, E., Matarajan, K., Banking Theory, Law and Practice, 11th edition, Himalaya publishing house, 1996

Choudhury, T.A., Choudhury, M. Saiful Karim, Workshop on UCPDC, Feb. 26-28, 2001, Bangladesh Institute of Bank Management.

Choudhury, T.A., Masud, Mahmudul Ameen, International trade and finance, reding material for MBM

Chairman

Board of Directors

Managing Director

Senior Executive Vice President

Senior Vice President

Vice President

Senior Assistant Vice President

Assistant Vice President

First Assistant Vice President

Jr. Assistant Vice President

Senior Executive officer

Executive officer

First executive officer

Probationary Officer

Officer