Performance evaluation of icb mutual funds (main body)

Performance Evaluation of ICB Mutual Funds

Chapter-1

INTRODUCTION1.1 ORIGIN OF THE REPORT

Practical knowledge makes a man expertise in the real life situation. Only theoretical

orientations can not make one suitable is his life. Keeping in view acquiring practical

knowledge, each business student is sent to any organization for an internship

program. This report has been primed as a requisite of the MBA Internship of

Department of Business Administration, Stamford University Bangladesh under the

supervision and guidance of Ms. Farjana Yeshmin, Assistant Professor, Department

of Business Administration, Stamford University Bangladesh. This report largely

imparts the author’s experience during the attachment with Investment Corporation of

Bangladesh (ICB).

1.2 BACKGROUND OF THE STUDY

Industrialization is one of the prime pre-requisites for development. Industrialization

needs Investment, because fund is the life blood of business. ICB broaden the base &

scope of investments by mobilizing savings.

ICB is virtually the only investment bank in the country engaged in operating

Investment Scheme. The corporation has completed about two decades of operation in

fulfillment of its objective. During its long period of operations the corporation has a

success story on the one hand and also some failure story on the others hand. The

investors’ scheme (IS) provides institutional support to small investor for purchases

and sales of securities by rendering necessary services and advice so that small

investors are in a position to make their investment decision on sound premises.

As I am doing my internship program in the investment banking institution so it is a

greater opportunity for me to find out the overall Performance Evaluation of ICB

Mutual Funds.

1.3 OBJECTIVE OF THE STUDY

The objectives of the internship program and this report are multiple and important.

This report is intended to let the author calibrate the skills acquired during the MBA

program. However the major objectives are as follows:

Analyze the management process of Investment Corporation of

Bangladesh.

To learn the practical aspect of the Investment Corporation of Bangladesh.

To relate our theoretical learning with the practical situation.

To review the overall performance of ICB Mutual fund.

To gather knowledge that how ICB floats and manage the mutual funds.

To analyze the present investment scenario in Bangladesh.

1.4 METHODOLOGY

A conceptual framework was developed through review of existing

literature on investment.

An inductive method has been followed in preparing the report.

The data has been collected by investigation of records from annual

reports and other published documents of the corporation.

Different forms of statistical configurations such as tables, percentages,

rates, ratios and diagrams have been used to make the study meaningful.

After collecting data, the data was first carefully scrutinized. Then the data

was organized with the help of statistical tool pack in MS Excel. The data

then analyzed & interpreted.

1.5 SCOPE OF THE STUDY

The scope of the report is basically the operations and practice of Investment

Corporation of Bangladesh and to focus on the overall performance of the ICB

Mutual Fund. The study was confined only on the Head Office and gave more

concentration on it. The data comparison was based on published information and oral

interview has performed to get the real perception of the investor. The empirical part

included only published information & current practices of ICB.

1.6 SOURCES OF INFORMATION

For the purpose of preparing this report, I have carefully observed all of the

departments of ICB and got some information from the responsible officers at certain

department. Sources of data collection are as follows:

1.6.1 Primary Data The primary sources of data were face to face communications & interview with ICB

personnel.

1.6.2 Secondary Data

Economic & business research wing of ICB.

Annual report of ICB.

Annual report of ICB mutual fund.

ICB general regulations & ordinance.

Research Library.

Bangladesh Bureau of Statistics.

Business studies journals & articles.

Institute of business administration journal.

1.7 LIMITATIONS OF THE STUDY

The report may suffer from limitations, which are completely unintentional on the

author’s part. The study had to be completed under certain constraints, which barred it

to be more effective. Some of these constraints are listed below –

ICB has 7 branches in the country. I could not able to visit all these

branch offices.

Secrecy of the official’s.

I had to go to every Department of ICB as a part of the Internship

program which is very difficult short span of time to get in-depth

knowledge about a large organization like ICB.

For my limited practical knowledge and experience, this report may not

cover all areas and may have unintentional errors & omissions.

Chapter -2

BACKGROUND OF ICB2.1 INTRODUCING ICB AS A FINANCIAL INSTITUTIONThe striking contradiction in most of the underdeveloped world including Bangladesh

is the large availability of local capital on the one hand and a relatively small use of

such capital in industry on the other hand. Thus application of a sound policy regime

and development of the financial institutions such as investment finance companies,

Stock exchange & mutual find etc. are very crucial in mobilizing capital for industrial

finance as well as development of capital market. Traditionally Bangladesh is an

agrarian economic country. The Establishment of Investment Corporation of

Bangladesh (ICB) was one of the significant measures taken by the government to

accelerate the pace of industrialization and developed well-organized capital market.

ICB is a statutory corporation, the corporate hub of government. It acts as an

investment bank. An investment bank is a financial institution, which mobilizes funds

from the surplus economic units by selling securities and deployed funds to the deficit

economic units also by buying & under writing securities.

2.2 HISTORICAL BACKGROUND OF ICB

The emergence of Bangladesh as a sovereign country in 1971 is the culmination of the

nine-month long heroic struggle of its people. Then the govt. of the infant country

nationalized almost all the industries under the Bangladesh Industrial enterprise

(nationalization) order 1972 popularly known as PO 27. After liberation in view of

socioeconomic changes the scope for private sector investment in the economy was

kept limited by allowing investment in projects up to Tk. 2.5 million. The new

investment policy which was announced in July 1972, provided for an expanded role

of private by allowing investment in a project up to Tk. 30 million. In spite of the

adequate facilities and incentives to the sector, encouraging response was not forth

coming. One of he reason among others, was the institutional facilities, which

provided underwriting support (like former investment corporation of Pakistan, ICP)

to industrial enterprises that was required to raise the much needed equity fund. Thus

the need for reactivation of capital market / stock market was keenly felt.

In the revised investment policy, which was announced in December 1975.

Government announced its decision to reactivate the stock exchange and examine the

question of recreation of Investment Corporation of Bangladesh. Accordingly a

committee of officials examined the matter and recommended for re-creation of ICB.

After the recommendation the ICB was established on the 1st October 1976, under the

ordinance, 1976 (No. XL of 1976). The establishment of ICB was a major step in a

series of measures under taken by the Govt. to accelerate the pace of industrialization

and develop a well-organized and vibrant capital market particularly securities market

in Bangladesh. It caters to the need of institutional support to meet the equity gap of

the industrial enterprises. In view of the national policy of increasing the rate of

savings and investment to foster self-reliant economy, ICB assumes an indispensable

and far reaching role. Through the enactment of the investment corporation of

Bangladesh (Amendment) Act, 2000 (XXIV of 2000), scope of ICB’s activities

through the formation and operation of subsidiaries has been expanded.

2.3 MILESTONES OF ICB

Table-1

Particulars Date of EstablishmentICB 1 October 1976Investors’ Scheme 13 June 1977ICB Chittagong Branch 1 April 1980First ICB Mutual Fund 25 April 1980ICB Unit Fund 10 April 1981ICB Rajshahi Branch 9 February 1984Second ICB Mutual Fund 17 June 1984Third ICB Mutual Fund 19 May 1985ICB Khulna Branch 10 September 1985ICB Sylhet Branch 15 December 1985Fourth ICB Mutual Fund 6 June 1986Fifth ICB Mutual Fund 8 June 1987Sixth ICB Mutual Fund 16 May 1988ICB Barisal Branch 31 May 1988Nomination as the Country’s Nodal DFI in SADF 7 May 1992Seventh ICB Mutual Fund 30 June 1995Eighth ICB Mutual Fund 23 July 1996ICB Bogra Branch 6 October 1996ICB Local Office,Dhaka 15 April 1997Purchase of Own Land & Building (Rajarbag) 11 December 1997Participation in equity of SARF 16 January 1998Advance against ICB Unit Certificates Scheme 12 October 1998Lease Financing Scheme 22 April 1999“The Investment Corporation of Bangladesh (Amendment) Act, 2000” 6 July 2000Formation & Registration of Three Subsidiary Companies 5 December 2000ICB Capital Management Ltd. 1 July 2002

ICB Asset Management Company Ltd. 1 July 2002ICB Securities Trading Company Ltd. 13 August 2002Registration as a Trustee with SEC 20 August 2002Registration as a Custodian with SEC 20 August 2002Bank Guarantee Scheme 21 June 2003Advance Against ICB Mutual Fund /ICB AMCL Unit Certificates Scheme

21 June 2003

Consumer Credit Scheme 15 February 2004Venture Capital Financing Scheme 26 April 2007Purchase of own Land (Agargoan) 3 March 2008Equity and Entrepreneurship Fund (EEF) 1 June 20092.4 OBJECTIVES OF ICB

To encourage and broaden the base of investment.

To develop the capital market.

To provide for matters ancillary thereto.

To mobilize savings.

To promote and establish subsidiary companies for business development.

2.5 BUSINESS POLICY OF ICB

To act on commercial consideration with due regard to the interest of industry,

commerce, depositors, investors and to the public in general.

To provide financial assistance to projects subject to their economic and

commercial viability.

To arrange consortium of financial institutions including merchant banks to

provide equity support to projects and thereby spread the risk of underwriting.

To develop and encourage entrepreneurs.

To diversify investments.

To induce small and medium savers for investment in securities.

To create employment opportunities.

To encourage Investment in IT sector.

To encourage Investment in joint venture capital/project.

2.6 BASIC FUNCTIONS OF ICB

Underwriting of initial public offering of shares and debentures

Underwriting of right issue of shares

Direct purchase of shares and debentures including Pre-IPO placement and

equity participation

Providing lease finance to industrial machinery and other equipments singly or

by forming syndicate

Managing investors' Accounts

Managing Open End and Closed End Mutual Funds

Operating on the Stock Exchanges

Providing investment counsel to issuers and investors

Participating in Government divestment Program

Participating in and financing of, joint-venture projects

Dealing in other matters related to capital market operations

Trusty, Custodian, Bank Guarantee

2.7 ICB’S CAPITAL STRUCTURE

ICB is a merchant bank as well as a statutory corporation. It has own ordinance 1976

(No XL of 1976). It is also public limited company. It is constructed by Company

Act. of 1949. The main source of capital is issuing shares to the public, long term loans

and debentures. The capital structure of ICB is given below:

Capital Structure of ICB

(An on 30 June 2010)

Table-2

Particulars Tk. in Crore

Paid up capital 200.60

Reserves 176.61

Retained Profit 222.25

Long term govt. Loan 3.50

Debentures 11.80

Others 10.60

Total 624.76

Figure1:

2.8 SHARE PRICE

Market price of a share of ICB of Tk. 100 each varied from lowest Tk. 2170.5 to

highest Tk. 5700.0 on the stock exchanges during the year. As on 30 June 2010, the

market price of an ICB share was Tk. 4991.75 on DSC and Tk. 5020.0 on CSE.

2.9 TRANSFER OF SHARES

The volume of shares transferred increased substantially during the year. A total of

665 shares were transferred during 2009-10 as against 99987 shares in 2008-09.

2.10 SUBSIDIARY COMPANIES OF ICB

“The investment corporation of Bangladesh (Amendment) Act, 2000” (XXIV of

2000) for Amendment of ICB ordinance 1976, ICB has been given power to create

subsidiaries under the said amendment and accordingly 3 subsidiary companies have

been created namely ---

ICB capital Management Ltd.

ICB Asset Management Ltd.

ICB securities trading Co. Ltd.

2.10.1 ICB Capital Management Limited (ICML)

ICB Capital Management Limited (ICML), started its journey as a subsidiary

company of Investment Corporation Bangladesh (ICB) on July 1, 2002. The

authorized and paid-up capital of ICML as on 30 June 2010 stood at Tk. 100.0 crore

and Tk. 58.5 crore respectively. ICML has been playing an important role in the

development of capital market by carrying out the functions of underwriting public

issue of securities, portfolio management, issue management and management of

investment accounts with the objectives to help mobilize savings and encourage and

broaden the base of investment. The Company has emerged as one of the fastest

growing merchant bank in the country.

2.10.2 ICB Securities Trading Company Ltd. (ISTCL)

ICB Securities Trading Company Limited (ISTCL) provides direct trading facilities

for buying and selling securities listed with the exchanges. The company has extended

its online trading and other brokerage services for general investors alongside the

institutional investors through its head office at Dhaka branch offices at Uttara (of

Dhaka), Chittagong, Sylhet, Barisal, Rajshahi, Khulna and Bogra.

2.10.3 ICB Asset Management Company Ltd. (ICBAMCL)

ICB Asset Management Company Ltd. a subsidiary company of ICB was registered

under the companies Act 1994 as a public company limited by shares on 5 December

2000. The company started its functions for management of mutual funds from July 1,

2001.

2.11 ORGANOGRAM OF THE ICB (Figure 2)

2.12 FUNCTION OF EACH DEPARTMENT

2.12.1 Operations Wing

2.12.1.1 Investor’s DepartmentThe main task of Investors’ Department are:

Maintain investment Accounts.

Sanction loans against deposits in investment Accounts.

Buy and sell shares on behalf of the investor both from the primary and

secondary market.

Implement negotiated over the counter transaction between investment

Account holders.

Counsel investors in respect of building up their portfolios.

Withdraw funds and shares from investment accounts.

Issue income tax certificates, portfolio statement accounts statement etc.

Provide service to investment account Holder.

Receive direct applications against public issue of shares;

Prepare a list of applications and send it to the companies along with

applications and money.

Receive allotment letters from the companies.

Collect commission as Banker to the issue and Brokerage commission from

the companies.

Keep financial records of all investment accounts.

Calculate quarterly interest of all investors Accounts.

Make periodical reconciliation of investment accounts.

Processing of withdrawal of funds,

Confirm fund position of individual Accounts.

Posting of all transactions

Any other assignment given by the management.

2.12.1.2 Shares DepartmentThe main task of shares department:

Act as safe custodian of all shares of investment accounts, mutual funds, unit

fund, ICB portfolio and all securities deposited in ICB as collateral security.

Maintain record of all the shares of above portfolios.

Split and consolidate shares from the companies as and when required,

Register and effect transfer of shares as and when required,

Allocate dividends, bonus and right shares of all companies funds, and

portfolios among the holders;

Posting of any transaction of share in customer ledger and company ledger

Physical verification of shares before internal transaction,

Receive & deliver the shares of branches

Send shares to transaction department for sale;

Make Delivery of shares of investors as requisitioned by investors department.

Receive and allot allotment letters / shares certificates of various companies to

investment accounts and portfolios.

2.12.1.3 Unit Repurchase DepartmentThe main task of unit repurchase department are listed below:

Act as manager of Unit Fund.

Sell and issue Unit Certificates to the applications.

Repurchase unit Certificates.

Issue new Unit Certificate in lieu of mutilated lost or defaced Unit certificates.

Co-ordinate activities of Bank Branches in respect of Unit sale and re-

purchase;

Receive check and authorized commission of sales by sales agents;

Make, official correspondences regarding unit certificates & issue of direct

mail shots, etc.

Determine sale and repurchase prices of unit certificates and communicate it

to Bank Branches and ICB Branches.

Transmit units of deceased unit holder.

Split and consolidate unit certificates as requested by unit holders;

Any other assignments given by the management.

2.12.1.4 Unit Registration and Procurement DepartmentThe tasks of this department are listed below:

Register and transfer Unit Certificates.

Maintain a separate Register for Unit holder under CIP.

Verify signature of Transfer Deed.

Issue dividend warrants and CIP Certificates to the holders.

Procure Unit certificates of various denominations from the printing press;

Issue Unit Certificates to ICB sale offices/ Branches as well as appointed Bank

Branches.

Evolve various prescribed forms and registers, print them and distribute them

among ICB Branches and Bank Branches as per requirement.

Co-ordinate all activities relating to procurement and issue of Unit

Certificates.


2.12.1.5 Mutual Fund Department

The tasks of this department are listed below:

Act as manager of all mutual funds.

Effect transfer and registration of certificates.

Issue dividend warrants to the holders of the certificates.

Make correspondences with the branches of the corporation, Banks and

certificate holders;

Arrange for payment of brokerage and commission to the Stock Exchange

members for successful applications submitted under their membership seals

and bankers to the issue respectively.

Arrange for splitting the share scripts as and when necessary in accordance

with the stock exchange rules.

Issue duplicate allotment letters/Certificates in case these are lost torn or hurt

or mutilated.

Arrange for revalidating the date of payment of dividend on Dividend

Warrants;

Any other Assignment given by the management.

2.12.1.6 Loan Appraisal DepartmentThe main activities of this department are given below:

Receive Investment proposals form sponsors;

Prepare appraisal reports on projects;

Conduct meting of the project appraisal committee;

Place appraisal reports to Board and the consortium;

Conduct Consortium Meeting and co-ordinate with the members of the

consortium.

Appraise management on technical aspect of projects;

Issue sanction letters to projects;

Maintain liaison with commercial banks / financial institutions / Ministry /

Agency.


2.12.1.7 Planning, Research & Business Development Department

The major functions of this department are:

To make the portfolio management decision in favor of the organization as

well as small investors.

Conduct meeting of the securities purchase and sales committee.

Convey securities sales or purchase decision to the merchandising division.

Perform all activities related to South Asian Development Fund (SADF).

2.12.1.8 Securities Reconciliation Department

This department is involved in reconciliation of the securities if any discrepancy rises

among the settle number of securities and the balance of the ledger. In case of sale

concern department go through by the help of shares department for the conformation

of physical existence of shares.

2.12.1.9 System Analysis Department

The functions of this department are –

System administration of the entire network setup.

Performing system analysis wherever ICB feels the need for periodic change

in computerization setup.

Performing miscellaneous small hardware and software related servicing

tasks on the many workstations, network system, server, and other

components and provide training to staff of other departments about computer

usage.


2.12.1.10 Programming DepartmentThis department’s functions are –

Developing new software for ICB.

Customizing the software developed in the present computerization phase

according to the changes of the requirements of the ICB with time.

Provide active assistance to the staff of system Analysis department for

training of the staff of other department about computer usage.


2.12.1.11 Data Management DepartmentThe functions of data management department are –

Handling peak load of data entry and data processing work for all other

departments of ICB.


2.12.1.12 Dematerialization Department

The main functions of this department are:

Paper share converted to electronic share.

70-75 Companies share has completed to dematerialization.

Converted to electronic share this department take custody fee.

2.12.1.13 Management Information Systems Department

This department basically helps the organization in decision making by providing

information. The main works of this department are:

Prepare and distribute Annual Report of ICB, Mutual Funds and Unit Funds.

Make arrangement for off loading of government portion of shares in different

companies and state owned institutions.

Manage the business development cell, which is established to explore the

possibility of business diversification.

Maintain liaison with ministry of finance, Bangladesh Bank and provide ICB

related information to interested parties.

2.12.1.14 Securities Analysis Department

This department basically analysis the securities in the market and upcoming

securities into the market. The basic task of this department is as follows:

Collect information about DSE, CSE, Public issue and half yearly accounts of

the listed company.

Prepare 5 years performance appraisal reports of the listed companies.

Prepare board memo regarding declaration of divisions on ICB’s own

portfolio, Unit and Mutual funds.

2.12.1.15 Venture Capital Department

With a view to encourage rapid industrialization of high risk but potential industries

of the country ICB as part of business diversification has launched venture capital

financing scheme. Up to 30 June 2010 ICB has received 5 applications for financing

of Tk. 76.62 crore.

2.12.1.16 Organizations and Methods Department

The main functions of this department are given bellow:

To prepare organizational manual of corporation.

To prepare systematic manual of corporation.

To prepare operation manual of corporation.

To maintain and coordinate of the directions and information’s regarding

corporations policy decisions.

To reform, correct and extension of corporate existing manuals of different

sections.

To select the system of administration of corporate different schemes.

To take permission and to inform the authority regarding the correction,

extension and changing the list of instruments and the organization chart.


2.12.1.17 Lien and Consumers Credit Department

As part of business diversification programme ICB has introduce Consumer Credit

Scheme in 2003-04 to meet the needs of various household appliances of different

professionals of govt., semi-govt., autonomous bodies and some established private

sector organizations. Under this scheme one can enjoy minimum of Tk. 10 lac but

maximum of Tk. 5 lac credit facilities. The rate of interest on the loan is reasonable

and competitive.

2.12.1.18 Leasing Department

ICB extends lease finance mainly for machinery, equipment and transport. ICB has

the capacity to provide professional advice and financial assistance to the prospective

clients. The period of lease, rentals, charges and other terms and conditions are

determined on the basis of types of assets and the extent of assistance required by the

applicants. Since introduction of this scheme in 1999 good response has been received

from the intending lessees.

2.12.2 Administration Wing

2.12.2.1 Personnel Department

The functions of the personnel department are:

To make necessary rules regulation policies for efficient administration of

the Corporation.

To recruit personnel for appointment in the Corporation.

To handle all personnel matters including confirmation, posting, transfer,

fixation, leaves etc.

Process all promotion, time scale, encashment, etc.

Process resignation, retirement cases.

Deal with retirement benefits including gratuity, pension, provident Fund

etc.

Control attendance.

Handle national pay scale, fixation, increment, etc.

Process A.C.R confirmation of employees, etc.

Deal with all types of disciplinary action.

Prepare long-term and short-term plans for executive development in the

corporation.

Explore more sources of financing of foreign training.

Arrange in service training where, among other, foreign-trained officers

will in turn train other officers though lecturers.

Arrange training of new recruit institute of the Corporation.

Run training institute of the Corporation.

Arrange seminars / symposium / workshops where experts in the line may

be invited to deliver lectures.

Procure training equipment and facilities for training manpower.

Deal with all matters relating ICB employee’s Union.

Deal with all matters relating to ICB officers Association.


2.12.2.2 Establishment Department

The main functions, which the establishment department accomplishes, are given below:

Collect stationery requirement of all departments.

Forecast the annual stationery requirement of the corporation.

Provide support facilities, such as, space, furniture, and stationery, printing

materials to all departments/employees of the corporation including branches.

Procure and distribute fixed assets, stationery and printing materials of the

corporation.

Process procurement of materials used in computers.

Process bills of computers.

Procure, distribute, inform, shoes, umbrellas etc.

Develop an inventory control mechanism to maintain economic order quantity

(EOQ).

Maintain EOQ to meet the urgent necessity of stationery.

Supply stationery to the department.

Continuous cheek up to stationery used by the various departments.

Processes staff loans & advance.

Maintain and repair all types of fixed assets, including vehicles, photocopy

machines, type writers and other fixed assets;

Maintain telephone intercom services, etc.

Provide staff bus facilities;

Deal with lease agreement of office premises and houses.

Provide medical retainer facilities.

Deal with group term insurance, subscriptions, donations, etc.

Deal with Benevolent Fund.

Process legal bills regarding legal services.

Install and repair all electrical equipment’s including fans and Air Conditioners.

Provide services to all types of meetings.

Process overtime, T.A./D.A. medical bill, WASA bills, electrical bills, etc.

Help employees in case of death, casualty distress and ameliorate sufferings;


2.12.2.3 Human Resources Department


To give and complete the different steps of training for the

officers/personnel’s in the corporation.

Inventing the foreign training and organize the training in the foreign

countries.

To organize the internal training for personnel.

To organize the training for new appointed personnel.

To maintain the official training center.

To organize the seminar/workshop, symposium, if needed take specialist.

To collect the training tools and give facilities of the trainee.

To select the officer/personnel for attending the different type of important

meeting, seminar and workshop.

According to need, others function given by administration.

2.12.2.4 Central Accounts Department

The main tasks of this department are –

Prepare income Tax return and matter relating to accounts.

Prepare bills including project Acco9unts and maintenance of project

accounts;

Prepare, salary statements, overtime statements, etc.

Make payments of all bills and invoices.

Prepare final Accounts.

Keep accounts for government loan and debentures.

Keep Accounts of Unit fund and mutual funds;

Make correspondence with the government, financial institutions, branches

Maintain liaison with external audit and commercial audit;

Maintenance of investors’ accounts & Portfolio ledgers;

Calculation of quarterly interest

Posting and balancing of ledgers

Preparation statement of accounts for investors

Furnishing of information to other department related to investors’ scheme.

Manage overall fund of the corporation

Determine sources of fund and raising of fund,

Ensure proper utilization of fund.

Prepare annual budget of the corporation.

Revise the budget as and when required,

Prepare fund flow statement of the corporation.

Ensure proper budgetary and cost control;

Take measure for control of expenditure.


2.12.2.5 Project Loan Accounts Department

The main tasks of this department are listed below:

Maintenance of loan ledgers for bridging & debenture loans;

Maintenance of registers for interest penal interest dues and over dues;

Calculation of interest and preparation of periodical bills

Preparation and dispatch of statement of Accounts.


2.12.2.6 Fund management department

The main works of this department are:

Manage overall fund of the corporation.

Different organization provided FDR

Different organization taken TDR

2.12.2.7 Law Department

Law department handles any kinds of legal affairs of ICB. The functions of this

department are as follows:

Process all legal matters;

Prepare legal documents, advance agreements, shares agreements, demand,

promissory Note, memorandum of Deposit of title deeds, etc.

Make correspondence with the company, prepare share certificates, debentures

Arrange execution of underwriting cum advance agreement, under writing

agreement and supplementary documents, etc.

Perform all types of legal works relating to staff advances;

Process litigation cases, prepare legal notices, and refer cases to legal advisor

and co-ordinate with legal advisor in the court.

Any other assignment given by the management from time to time.

Preserve, supervise and keep in safe custody of legal security documents in

connection with underwriting advance, debenture loan and se4curities of unit

fund portfolio, etc.

Coordinate with the management, ministries and other Government officers in

respect of legal affairs;

Take necessary steps in respect of necessary announcements of ICB

ordinance, General Regulations, ICB staff House Building Advance

regulation, and ICB service regulations, etc.

Prepare necessary Board Members for placement in the Board meeting

relating to litigation and legal affairs;

Represent management and the corporation in legal suits

2.12.2.8 Public Issue Department

The activities of this department are-

Visit and collect audited financial statement from the sponsors.

Analyze the financial statement on going project.

Advice, peruse sponsors for going for public issue.

Assist sponsors to prepare prospectus for issuing shares and debentures.

Examine the prospectus submitted by the sponsors and make arrangements for its

approval.

Arrange no objection from the main loan financing institution;

Advise companies in issuing allotment letters and refund warrants;

Make necessary adjustments of bridging loan of concerned company.

2.12.2.9 Documentation Department

The following are the main functions of this department are:

All important documents are kept

Debenture finance

Lease finance

Asset securitization

Equity/ Preferential share finance

2.12.2.10 Project Implementation and Follow-up Department

The following are the tasks of this department:

Placement of IPO.

Justify the projects terms and conditions.

Help implementation of sanctioned projects.

Review progress of implementation of projects and recommend disbursement

of funds.

Submit progress reports to the management regarding implementation.

Process the case for cancellation of sanctioned projects.

Inspect the site and books of accounts of projects

Make recommendations for additional loans in appropriate cases and refer

them to LDA.

Provide counseling for solution of any disputes and problems.

Inspire the project to go for public as far as possible after commercial

operator.

Contract with the consortium member/main financer regarding

implementation of the projects.

Take necessary steps to re-arrange the consortium commitment during

implementation period if necessary.

2.12.2.11 Recovery Department

Loan recovery and follow-up department is the key operation as it ensures the

recovery of funds provided as credit. There remains two ‘Task forces’ and the

‘Review & Monitoring Committee’ for giving necessary guidelines for accelerate

process of recovery.


To provide and reconcile statements of dues /over dues periodically.

To visit projects for evaluating operational performances.

To hold meeting with sponsors of ICB financed projects in connection with

recovery of dues.

To furnish status reports on the sponsors of ICB assisted projects to different

institutions.

To ensure recovery of dues /over dues from sponsors.

To recommend for making necessary provisions for bad and doubtful debts in

the Annual Accounts of the Corporation.

To prepare memorandum for consideration of the Board of Directors for

granting financial relief to projects facing various problems.

Analyze the problem of sick projects and put forward suggesting for salvation

of the same.

Assist the Law Department of the Corporation to take legal actions against

defaulting projects.

To furnish information to different departments of ICB regarding recovery of

loans.

2.12.2.12 Trustee department

The main functions of loan appraisal departments are:

One of the most important works is to save the self-keeping of the investor,

bond holder, Debenture holder.

To reserve the resources of the trustee.

To maintain the account of trustee.

To give the monthly report in the SEC which are related to the trust

maintaining

The savings money of the trustee is invested for short term.

2.12.2.13 Custodian Department

To ace as the custodian to the public issue of open-end & closed-end mutual funds,

ICB provides professional services. It also acts as banker to the issues and provides

similar services through the network of its branches. Fees in this regard are

negotiable.

2.12.2.14 Secretary’s Department

The main of this department are as follows:

Arrange meetings of the Board of Directors, Executive committee and other

committee.

Issue notices of Board, E.C., and other committee meetings, prepare agenda

and memos, etc.

Place working papers to the members of the Board/Committee.

Maintain attendance registers of Directors.

Obtain signature of the chairman in the minute’s book.

Send decisions of the meetings for implementation of concerned departments.

Send minutes of the meeting to the members of the Board and Government of

Bangladesh.

Correspond with the Govt. regarding share capital/ debenture, etc.

Correspond with the shareholders on different relevant matters.

Maintain register of shareholders of the corporation.

Arrange holding of Annual General Meeting of the corporation.

Make arrangement for holding of election of the Board of Directors;

Make payment of dividend to the shareholders.

Arrange transfer, splitting of shares and issuance of duplicate certificates;

Deal with and put up papers to the MD on the Board meetings of other

institutions where the Government nominates the MD as Director.

Any other assignments given by the Board/Management.

2.12.2.15 Public Relations Department

The main of this department are as follows:

Maintain close liaison with the ministry of Finance and other concerned

officers,

Help publish all type of official advertisement.

Furnish management with the relevant newspaper cuttings.

Help focusing ICB through mass media.

Meet all adverse comments about the corporation published in different

newspapers and periodicals.

Publish internal newsletter of journal.

Appraise the management of its overall relation to the public.

Any other matters as may be assigned by the management.

Chapter 3ACTIVITIES OF ICB3.1 ICB AS MOTIVATOR IN STOCK MARKET

ICB has been one of the architects of the capital market, particularly the securities

market in Bangladesh. ICB undertakes diverse activities with the objectives of

quickening the pace of industrialization on the one hand and on the other hand, bolster

the capital market. ICB and its three subsidiary companies play impressive roles in

maintaining a buoyant and sustainable capital market in the country. In this regard

ICB participates both in primary and secondary markets. As on 30 June 2010, the

number of ICB assisted securities was 139 out of 279 listed securities (excluding 171

Govt. treasury bonds) of Dhaka Stock Exchange Ltd. Out of 232 listed securities of

Chittagong Stock Exchange were 100.

In the reporting year, through the purchase and sale of securities for ICB’s investment

portfolio, unit fund and mutual funds portfolios and on behalf of investment account

holders ICB made significant contribution In maintaining depth, stability, reliability

and liquidity of the stock market. During 2009-10 the total trading of ICB and its

subsidiary companies in both the bourses was Tk. 12435.32 crore which was 129.24

percent higher than the previous year. In the reporting year, ICB and its subsidiary

companies contribution to total turnover of Tk. 277870.91 crore of both the bourses

was 4.48 percent which was 5.32 percent in the preceding year. As the rate of

contribution of ICB and its subsidiary companies to total turnover of both the bourses

has increased, simultaneously the transaction volume has increased significantly

during the year.

The activities pertaining to merchant banking, mutual fund operations and stock

brokerage functions by the three subsidiary companies of ICB, namely ICB Capital

Management Ltd.ICB Asset Management Company Ltd. and ICB Securities Trading

Company Ltd. has been remarkable during the year. During the year, all the mutual

funds and unit funds managed by ICB Asset management Company Ltd. a subsidiary

of ICB declared much higher dividend over 2008-09. ICB motivates companies to

float bonds in the securities market. Up to 30 June 2010, 11 bonds of 8 companies of

Tk.1007.95 crore have been floated of which one is a listed corporate bond. Ten out

of these eleven bonds were floated under trusteeship of ICB.

ICB has taken steps to float two sectoral mutual funds of Tk. 500.0 crore each mainly

to develop the power sector of the country. The decision was taken in a Board

meeting held on 13 April 2010.

3.2 OPERATIONAL ACTIVITIES

ICB has continued to provide financial and other assistance to companies in different

forms with a view to accelerating the pace of Industrialization as well as to

developing a well-organized and vibrant securities market in the country. In this

regard ICB undertakes diverse activities.

ICB’s existing financial and other activities for capital market development and

industrialization include:

i. Direct participation in equity

ii. Purchase of shares, debentures bonds and preference shares

iii. Lease financing

iv. Venture capital financing

v. Advance against equity

vi. To act as trustee as well as custodian to the issue of debentures, bonds, mutual

funds etc.

3.2.1 Consideration of Applications

In 2009-10, ICB received 29 applications for financial assistance amounting to Tk.

604.33 crore. There were 29 pending applications at the end of 2008-09. As a result,

ICB had a total of 58 applications for processing in 2009-10 out of which 19

applications were approved, 28 were rejected and 11 were under consideration.

3.2.2 Commitment

During 2009-10, ICB made commitment of total financial assistance of Tk. 209.62

crore to 19 projects. In 2008-09, ICB's commitment of total financial assistance was

Tk. 137.05 crore to 15 projects.

Details of commitments made by ICB during 20099-10 and 2008-09 are shown in the

following table:

Table-3: Comparative position of commitments during 2009-10 and

2008-09

(Tk. in crore)

Nature of Financial Assistance 2009-10 2008-09 Increase/

Decrease

in amount

(%)

No. of

Projects

Amount No. of

Projects

Amount

Pre-IPO Placement of shares 4 21.00 1 2.00 950.00

Purchase of preference share 1 50.00 1 20.00 150.00

Equity participation 1 0.12 1 0.20 -40.00

Purchase of debentures 9 45.50 9 84.50 -46.15

Lease financing 3 79.00 3 30.35 160.30

Investment in bonds1 14.00 - -

Total19 209.62 15 137.05 52.95

In addition, ICB committed to act as trustee to the issue of bonds of a company of Tk.

250.00 crore during the year. ICB also committed to act as trustee as well as custodian

to the issue of 7 close-end mutual funds of Tk. 755.00 crore.

3.2.3 Cumulative Commitment

Upto 30 June 2010, cumulative commitment by ICB for financial assistance stood at

Tk. 1062.63 crore to 497 projects. A summarized statement of cumulative

commitments made by ICB as on 30 June 2010 is given below:

Table-4 Cumulative commitment of ICB as on 30 June 2010 (Tk. In Crore)

Nature of Commitment 2009-10

No of Projects Amount

Bridging loan 306 116.48

Debenture loan 50 52.30

Sub Total 309* 123.28

Direct Underwriting:

Share 44 73.29

Debentures 6 14.00

Sub Total 45** 87.29

Pre-IPO Placement:

Shares 37 82.57

Debentures 13 46.05

Purchase of preference share 12 114.65

Purchase of debenture 47 247.35

Investment in bonds 8 68.34

Direct equity participation 16 21.37

Advance against equity 2 40.00

Lease financing 57 231.28

124*** 852.06

Total 497 1062.63

* Include 38 projects which were given commitment for both bridging loans and debenture loans.

** Include 5 projects which were given commitment for direct underwriting of shares and debentures.

*** Commitments were given by ICB.

3.2.4 Disbursement

The cumulative disbursement of project loans of ICB stood at Tk. 114.52 crore to 308

projects. ICB discontinued bridge financing from 1997.

The following table shows sector-wise cumulative disbursement of project loans by

ICB:

Table-5: Position of sector-wise disbursement of project loans (Tk. in crore)

Sector No. of

projects

bridging loan debenture

loan

Total Percentage

Food & Allied products 99 17.22 2.10 19.32 16.87

Textile 58 43.72 1.00 44.72 39.05

Specialized Jute products, Jute yarn,

twine and carpets

33 14.85 0.53 15.38 13.43

Forest Products and Allied 1 0 0.15 0.15 0.13

Paper Board printing and

Publishing

11 3.39 0.10 3.49 3.05

Tannery, Leather and Rubber

Products

12 3.28 0.28 3.56 3.11

Chemical, pharmaceuticals and

Allied products

30 8.14 0.76 8.90 7.77

Glass, Ceramic and Other Non-

metallic Mineral products

9 3.60 0 3.60 3.14

Engineering 29 9.61 1.21 10.82 9.45

Services 6 1.60 0 1.60 1.40

Ships, Road and inland water

transport

16 1.45 0 1.45 1.27

Miscellaneous 4 1.33 0.20 1.53 1.34

Total 308 108.19 6.33 114.52 100.00

3.2.5 Computerization of ICB

ICB completed computerization of most of its business activities with the help of its

own computer set-up. The screen based online trading on DSE & CSE also continued

smoothly during the year. With the implementation of computerization program of

ICB, the standard of customer service, work efficiency of the employees and overall

working environment have substantially improved. ICB's branches have been using

the merchandising software.

The interested investors at home and abroad can also obtain information about ICB as

well as its various schemes through the ICBs own web site, www.invest-corp-

bangladesh.com.

Recently ICB inaugurated on test basis its telephonic transaction and inquiry system

(TTIS). The TTIS when fully implemented will facilitate investors to collect any

information particularly that of Investors Account portfolios, current balance and

other information from outside ICB premise. This, in turn, will help investors to save

time and money.

ICB developed a set of software to automate and support its main business and

management operations. The software are Merchandising Operations Management

system, Mutual Funds Scrip and Ownership Management system, Stock Exchange

Index Publication, IPO Management, Personnel Management Information System,

Project Information Management System, Meeting Minutes Storage & Retrieval and

Law suit Tracking, Unit Sales & Repurchase Management System, Financial

Feasibility Analysis for Projects, Accounting Application, Unit Reconciliation,

Mutual Fund Reconciliation, Share Reconciliation etc.

The existing system was installed in 1998. To coup with the urgent needs and

demands and to avoid any technological hazards a new server has been installed on

rental basis to provide supportive services until phase-wise up gradation is completed.

Local Area Network (LAN) has been installed and all the branches are now connected

through E-mail. The demand for computer is increasing as the volume of work of ICB

has expanded. During the year 10 IBM computers with pentium 4 processor and 10

UPSs have been procured to facilitate instant customer service.

ICB had extended helps to its subsidiary companies by developing and supplying

required software and providing hardware trouble shooting services for their day to

day functions through computer. Besides, subsidiary companies are being provided

with all sorts of technical supports relating to computer as and when needed.

A plan of establishing a linkage between the server of subsidiary companies and that

of the ICB Head Office is under consideration so that information can be exchanged

between ICB and subsidiary companies as and when it is warranted.

The plan of phase-wise up gradation of existing system of lCB has been undertaken.

The design of phase wise up gradation is being examined by competent

authorities/organizations of the computer field.

Taking connection of broadband system of Internet is under active consideration of

management and is expected to be installed soon. This system will facilitate broader

scope to share/utilize the information available through Internet.

3.2.6 IT Planning Process in ICB

ICB has emerged as one of the leaders in computerization and software developers in

Bangladesh. ICB initiated computerization program in 1985. Thus it is one of the very

first local financial institutions to adopt computers and computing software systems in

Bangladesh. Since then ICB has been continuously upgrading the system according to

specific long-term plans to keep pace with modern financial world. When planning

for long-term sustainable IT framework throughout the organization the prime factors

ICB always considered are.

IT friendly process that is easily adaptable to computer technologies.

A solid computerization environment and platform of choices, which will serve

for a long time and con be easily tailored for future enhancements/up gradation.

A solid hardware and network platform that is stables, scalable and have high

performance with a special focus on future business diversification, mean-time-to-

response.

Scope of future enhancement both in terms of business process and in terms of IT

infrastructure so that ICB can always keep pace with the fast changing world of

financial operations.

enhancement and development and system support.

The computerization plan should put emphasis on selection of hardware, network

technology and platform software like RDBMS choice management support.

Future Roadmap

A great deal of planning effort of the Corporation has been towards future IT structure

and related operations In the road map the following goals have been set

Establishing ICB firmly on IT industry not only as a consumer but also as

a formidable IT solution provider especially in the financial sector. ICB

believes its huge experience over the years and infrastructure are

something that can be offered in the financial arena of Bangladesh and

abroad on business basis in the future.

ICB is in tile line of a unified system with end-to-end operational activity

solution and MIS. With this in mind there is a plan for future integration

and re-engineering of the existing software system into an integrated

resources Planning (ERP).

ICB is planning to connect all its branch operation online with its head

office system Online integrated branch with the central data depository in

head office based on a strong WAN connection is the next in line.

ICB is planning to provide web-based online services to its clients. The

online system will incorporate a business to client service for end-users

and a business-to-business service for corporate sector and other business

associates.

In the long run, ICB may consider establishing a separate business entity

on IT, if found viable.

ICB is considering to go for starting full pledged activity in the field of IT

area

ICB is actively considering providing web-based online services to its

clients.

ICB is also actively considering to connect all its branches through WAN with head

office. So that Customers at any corner of the country can get instant services.

3.2.7 Participation in International Activities

ICB is the glittering star in our national economic sky. But it crosses its national

boundary and become internationalize to some aspect. ICB’s involvement with South

Asian Development Fund (SADF) and in South Asia Regional Fund (SARF) is two

worth mentioning issue.

3.2.7.1 ICB’s Involvement with South Asian Development Fund

(SADF)

SAARC Fund for Regional Projects, (SFRP) & SRF were established in 1991 with

the collaboration of member countries of the SAARC. The establishment of SADF

was officially declared by dissolving SFRP and SRF in a meeting of member

countries held in Dhaka in June 1996. SADF is an Umbrella Fund comprising three

windows: (i) Window for Identification and Development of Projects, (ii) Window for

Institutional and Human Resource Development Projects and (iii) Window for Social

and Infrastructures Development Projects. ICB being the nodal DFI has been

representing Bangladesh in the governing board of SADF and proportionately

contributed to the fund. Up to 30 June 2003, the Seventh meetings of the governing

board of SADF were held. The Managing Director of ICB performed the

responsibilities of the First Chairman of the governing board of SADF and by

rotation, the Chief Executive of Nepal Industrial Development Corporation (NIDC) is

the current Chairman of the governing board of SADF. Under Window-1 of SADF,

identification and feasibility studies of 16 projects have been completed of which 7

projects are in Bangladesh and under Window-II of SADF one training program was

arranged in India.

3.2.7.2 Investment in South Asia Regional Fund (SARF)

The Commonwealth Summit was held in 1997, declared a US$ 200 million

Development Fund namely, South Asia Regional Fund (SARF) to facilitate

investments in SAARC member countries. The Fund is managed by a wholly owned

subsidiary of Commonwealth Development Corporation (CDC) incorporated in

Mauritius. In addition, CDC has made equity investments to the tune of US$ 50

million in this Fund. The objective of the Fund is to achieve long term benefit through

direct equity and equity related investments in private sector companies of SAARC

region. ICB has made investment of US$ 1 million in SARF from ICB Unit Fund and

in exchange the SAARF has issued 1,000 Ordinary 'A' shares and 1,000 8%

Preference shares in favor of ICB Unit Fund. ICB Unit Fund had received in 2001-02

US$ 19,606.72 and in 2002-03 US$ 15471.72 as redemption value of 16 (sixteen) &

11 (eleven) preference shares respectively. During this period SARF made investment

in 13 (Thirteen) high technology projects including one Bangladeshi Cellular Phone

Company, Grameen Phone Ltd.

3.3 SERVICES OF ICB

The following services are rendered by ICB:

3.3.1 Private Placements

ICB is authorized to act as an agent of the issuers and investors for private placements

of securities. Under this arrangement, ICB places securities to individuals/institutions

on behalf of the issuers for which it charges fees. ICB also acquires shares/securities

for its own portfolio.

3.3.2 Custodian and Banker to the Issue

To act as the custodian to the public issue of open-end &closed-end mutual funds,

ICB provides professional services. It also acts as banker to the issues and provides

similar services through the network of its branches. Fees in this regard are

negotiable.

3.3.3 Lease Financing

ICB extends lease finance mainly for machinery, equipment and transport. ICB has

the capacity to provide professional advice and financial assistance to the clients.

The period of lease, rentals, charges and other terms and conditions are determined on

the basis of type of assets and the extent of assistance required by the applicants.

Since introduction of this scheme in 1999 good response has been received from the

intending lessees.

3.3.4 Consumer Credit Scheme

As part of business diversification program, ICB has introduced "Consumers Credit

Scheme" in 2003-04 considering at the need of various household commodities of

different employees of govt., semi-govt., autonomous bodies and some established

private sector organizations. Under this scheme one can enjoy minimum Tk 1.0 lac

but maximum 5 lac credit facilities. The rate of interest on the loan is reasonable and

competitive.

3.3.5 ICB Mutual Fund

Mutual Funds are also known as close ended Mutual Funds. The issued capital of a

Mutual Fund is limited, that is, a Mutual Fund offers a limited number of certificates

for sale to the public. The amount of capital and the number of certificates of each

Mutual Fund remains unchanged. ICB Mutual Funds are independent of one another.

A Mutual Fund being listed is traded on the Stock Exchanges. Price of Mutual Fund

certificates after IPO is determined on the Stock Exchanges through interaction of

supply and demand. The market price of a Mutual Fund certificates is available in

Stock exchange quotations and in newspapers.

3.3.6 Investors’ Scheme

The investors’ Scheme was introduced in June 1977. Over the years, this scheme has

grown tremendously. ICB, at its discretion, may grant up to two times loan against the

assets of the account subject to a maximum limit of tk. 3 lac. An account holder may

use the combined balance of his/her equities and loan to buy shares/securities. To help

the investors to develop diversified and balanced portfolio to minimize risk and earn a

reasonable return, ICB provides professional advice and other support services. Under

the restructuring program, ICB operates and manages only the old accounts and new

accounts are being opened and managed by the ICB capital Management Ltd., a

subsidiary of ICB.

3.3.7 Venture Capital Financing

As part of business diversification and to encourage rapid industrialization of non-

traditional, risky but potential industries in the country ICB has launched Venture

Capital Financing scheme.

3.3.8 Advances against ICB Mutual Fund Certificates Scheme

Advance against ICB Mutual Fund Certificates Scheme was introduced in 2003,

designed for the ICB mutual fund certificate holders to meet their emergency fund

requirements. One can borrow maximum of 50 percent value of last one year’s

weighted average market price of certificates at time of borrowing by depositing

his/her certificates under lien arrangement from any of the ICB offices. The rate of

interest on the loan is reasonable and also competitive.

3.3.9 Advances against Unit Certificates Scheme

Advance against ICB Unit Certificates Scheme was introduced in 1998, especially

designed for the ICB unit- holders to meet their emergency fund requirements. One

can borrow maximum Tk. 85 per unit by depositing his/her unit certificates under lien

arrangement from any of the ICB offices where from such unit certificates were

issued. The rate of interest on the loan is reasonable and competitive.

3.3.10 Bank Guarantee Scheme

As part of ICB’s business diversification program, the Corporation introduced Bank

Guarantee scheme during the year 2002-2003. ICB provides (1) Bid Bond for

enabling the business people to participate in any tender or bidding; (2) Performance

Bond for helping the business community to continue their business smoothly by

fulfilling their obligations promised by them to their clients; (3) Customs Guarantee

for solving different disagreements between the customs authority and the business

classes at the initial stage. The maximum limit of guarantee is Tk. 2.00 crore and

would be issued against at least 20% cash and 80% easily encashable securities or

against 100% cash margin. Re-guarantee from other financial institution is required

for guarantee against the amount exceeding Tk. 2.00 crore.

3.3.11 ICB Unit Fund

It is an open-ended Mutual Fund scheme Launched in April 1981, through which the

small and medium savers get opportunity to invest their savings in a balanced and

relatively low risk portfolio. ICB has so far declared attractive dividends on Units

every year ranging from Tk. 12 to Tk. 25 per unit. Investment in Units enjoys tax

benefit, amount being applicable as per law. However, under the ICB’s restructuring

program new unit certificates are being sold by ICB’s new subsidiary company “ICB

Asset Management Company Ltd.”

3.3.12 Managers and Acquisitions

Companies willing to expand their business through mergers or acquisitions or to

Disinvestment projects that no longer viable into present capacity of operation can

contact the Corporation. ICB provides professional services & advices in respect of

shaping up the cost and financial structures to ensure best possible operational results.

Besides, in case of divestment, the corporation, through network and established

business relationship, bring buyers and sellers together, help them to negotiate final

agreement and advice on the emerging corporate structure.

3.3.13 Corporate Financial Advice

Companies and Government enterprises intending to go public often seek professional

& financial advice on corporate restructuring & reengineering. ICB through its

expertise provide such services.

3.3.14 Trustee, Custodian and Issue Manager

ICB is acting as trustee to the issue of debenture and securitized bonds. Up to 30 June

2010 ICB acted as trustee to the debenture issues of 17 companies involving Tk.

184.15 crore and issues of 10 bonds of 7 companies involving Tk. 874.36 crore. ICB

also undertook the responsibilities of trustee to 18 mutual funds involving Tk.

1280.00 crore.

Chapter-4

OVERVIEW OF ICB MUTUAL FUNDS4.1 MUTUAL FUND

A Mutual Fund offers a limited number of certificates for sale to the public. The amount of capital and the number of certificates of each Mutual Fund remains unchanged. ICB Mutual Funds are independent of one another. A Mutual Fund being listed is traded on the Stock Exchanges. A Mutual Fund certificates is available in Stock exchange quotations and in newspapers. Price of Mutual Fund certificates after IPO is determined on the Stock Exchanges through interaction of supply and demand.

4.2 LEGAL STATUS AND OBJECTIVE OF THE FUND

Investment Corporation of Bangladesh (ICB) was established in 1976 with the objectives of acceleration industrialization and economic development of the country through development of capital market by mobilizing savings and encouraging and improving the investment climate in the country with particular emphasis placed on broadening the base and scope of investment as well as tapping marginal investors.

4.3 NATURE OF BUSINESS

The business of the Fund is to mobilize savings from the investors by way of selling certificates and investing the funds in securities so as to ensure maximum return for certificate holders. This is a closed-end Fund invested in securities as a single account. Income, net of expenses, is distributable to certificate holders on a yearly basis.

4.4 THE MAIN PURPOSE OF MUTUAL FUND

The main purposes of the Mutual Funds are:

Emphasis is on producing a steady flow of dividend payment

Concentrates on increasing the value of principal through appreciation of the stocks held

Some combination of the first two approaches

4.5 OPERATIONAL HIGHLIGHTS

4.5.1 Launching Table-6

Mutual Fund Date of Launching Paid-up Capital

(Taka in lac)

First ICB Mutual Fund 25 April,1980 50.00

Second ICB Mutual Fund 17 June,1984 50.00

Third ICB Mutual Fund 19 May,1985 100.00

Fourth ICB Mutual Fund 6 June, 1985 100.00

Fifth ICB Mutual Fund 8 June, 1987 150.00

Sixth ICB Mutual Fund 16 May,1988 500.00

Seven ICB Mutual Fund 30 June,1995 300.00

Eighth ICB Mutual Fund 23 July,1996 500.00

Total 1750.00

4.5.2 Portfolio Position, Market Price per Certificate and Number of Certificate Holders (as on 30 June 2010)

Table-7

Name of the Fund Cost of portfolio(Tk. In Lac)

Market Value of the portfolio(Tk. In Lac)

Market price per certificate(Taka)

No. ofCertificate-holders

First ICB mutual fund 887.70 7791.87 8701.00 1105Second ICB mutual fund 312.98 1782.44 2578.75 1093Third ICB mutual fund 698.25 2547.87 1972.50 1502Fourth ICB mutual fund 748.52 2784.04 2139.75 1253Fifth ICB mutual fund 952.61 3662.00 1763.00 2560Sixth ICB mutual fund 1225.85 4162.39 647.75 6385Seventh ICB mutual fund 1341.95 4324.86 1063.00 2383

Eighth ICB mutual fund 1538.86 5002.74 755.50 6735Total 8006.72 32058.21 23016

4.5.3 Operational Result: Table-8

Name of the Fund Net Income(tk. In Lac)

Distributable incomePer certificate(Taka)

Ex-dividendIntrinsic value per Certificate (Taka)

First ICB mutual fund 423.33 1006.53 9877.68Second ICB mutual fund 127.43 519.78 2788.41Third ICB mutual fund 184.38 376.89 2190.38

Fourth ICB mutual fund 177.72 368.20 2387.84Fifth ICB mutual fund 213.52 220.71 2036.43Sixth ICB mutual fund 453.33 134.80 748.85Seventh ICB mutual fund 299.62 155.77 1180.13Eighth ICB mutual fund 463.64 137.17 864.95

4.5.4 Dividend Performance: (Tk. per Certificate)Table-9Mutual Funds Financial Year

2007-08 2008-09 2009-10First ICB mutual fund 265.00 310.00 400.00

Second ICB mutual fund 75.00 95.00 200.00

Third ICB mutual fund 65.00 85.00 140.00

Fourth ICB mutual fund 60.00 80.00 125.00

Fifth ICB mutual fund 45.00 56.00 100.00

Sixth ICB mutual fund 30.00 37.00 75.00

Seventh ICB mutual fund 30.00 32.00 70.00

Eighth ICB mutual fund 25.00 32.00 65.00

4.6 CONSOLIDATED PORTFOLIO STATEMENT

As on 30 June 2010 cost price and market price of eight Mutual Funds were Tk. 8006.72 lac and Tk. 32058.21 lac respectively. A consolidated statement of the portfolio of the Funds is given in the following table:

Table-10: Consolidated position of portfolios of ICB Mutual Funds as on June 2010

Sl.no.

Particulars 1st

Mutual Fund

2nd

Mutual Fund

3rd

Mutual Fund

4th

Mutual Fund

5th

Mutual Fund

6th

Mutual Fund

7th

Mutual Fund

8th

Mutual Fund

1 No. of Companies

122 120 140 139 153 187 181 172

2 No. of Securities

124 123 141 141 155 189 182 177

3 Total investment at cost (Tk. In Lac)

887.70 612.98 698.25 748.52 952.61 1225.85 1341.95 1538.86

4 Market Value 7791.87 1782.44 2547.87 2784.04 3662.00 4162.39 4324.86 5002.74

4.7 PRICE MOVEMENT

During the year under review, certificates of eight Mutual Funds were actively traded on the floor of the Dhaka Stock Exchange Ltd and Chittagong Stock Exchange Ltd. The highest and lowest price of the eight Mutual Funds certificates on Dhaka Stock Exchange Ltd and position of total transaction during 2009-10 are shown in the following table:

Table-11: Market prices of ICB Mutual Funds and Transactions during 2009-10

Sl. No

Mutual Funds Highest market price (Taka)

Lowest market price (Taka)

Closing Market Price (Tk as on

30 June 2010

1 First ICB Mutual Fund 9450.00 5790.00 8701.00

2 Second ICB Mutual Fund 1100 721 2578.75

3 Third ICB Mutual Fund 690 460.50 1972.50

4 Fourth ICB Mutual Fund 700 458 2139.75

5 Fifth ICB Mutual Fund 465 200 1763.00

6 Sixth ICB Mutual Fund 350 175 647.75

7 Seven ICB Mutual Fund 320 165.25 1063.00

8 Eight ICB Mutual Fund 316 162 755.50

4.8 DETAILS DESCRIPTION OF ICB’S EIGHT MUTUAL FUND

4.8.1 First ICB Mutual Fund

The First ICB Mutual was established in April 1980, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 50,000 certificates of Tk. 100 each. In the financial year 2006-07, one bonus certificates were issued against two certificates and capital fund raised by Tk. 25, 00,000. Now the paid-up capital of the fund stood at Tk. 75,00,000 divided into 75000 certificates. The manager of the Fund is vested with ICB.

4.8.1.1 Dividend Income

The Fund has earned an amount of Tk. 85.70 lac as dividend from 47 securities during 2009-2010 of which a sum of Tk. 74.69 lac (87.15 percent) was received in cash within 30 June 2010.

4.8.1.2 Capital Gains on Sale of Investments

During 2009-10, the Fund earned Tk. 375.65 lac as capital gains by selling securities of 78 companies.

4.8.1.3 Income, Expenses and Distribute Income

During the year under review, the Fund has earned a gross income of Tk. 469.34 lac. by way of dividend income of Tk. 85.70 lac. interest income of Tk. 7.99 lac. on bank deposits, capital gains of Tk. 375.65 lac. and other income. After deducting the total expenses of Tk. 46.01 lac. incurred as staff expenses, interest on current account with ICB, management fee, printing and stationery, postage and telegram, bank charges, provision against investment and others the net income of the Fund stood at Tk. 423.33 lac. Taking into account the previous year’s undistributed income of Tk. 331.57 lac. the Fund had a net distributable income of Tk. 754.90 lac. as on 30 June 2010 resulting in distributable income per certificate of Tk. 1006.53.

4.8.1.4 Dividend

The Fund has declared dividend at the rate of 400.00 percent which was 310.00 percent for the previous year. After making provision of Tk. 300.00 lac for payment of dividend the Fund had an undistributed income of Tk 454.90 lac. The Year –wise dividend the Fund had an undistributed income of Tk. 454.90 lac., details given in Appendix-A1.

4.8.1.5 Portfolio

During 2009-10, the Fund has made an investment of Tk. 168.43 lac in securities of 24 companies. As on 30 June 2010 the Fund had securities of 122 companies in its portfolio with a total cost of Tk. 887.70 lac, the market value of which was Tk. 7791.87 lac.

The ex-dividend net asset value per certificate of Tk. 100.00 each of First Mutual Fund stood at Tk. 9877.68 as on 30 June 2010.

The opening and closing market price per certificate of First ICB Mutual Fund of Tk. 100.00 each of the fund was Tk.5783.00 and Tk. 8701.00 as respectively in 2009-10.

The number of certificate holders of the fund was 1105 as on 30 June 2010.

4.8.2 Second ICB Mutual Fund

The Second ICB Mutual was established in June 1984, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 50,00,000 dividend into 50000 certificates of Tk. 100 each. The manager of the Fund is vested with ICB.


The Fund has earned an amount of Tk. 29.67 lac as dividend and interest from 44 securities during 2009-2010 of which, Tk. 26.81 lac (90.50 percent) was received in cash within 30 June 2010.


During 2009-10, the Fund has earned Tk. 247.65 lac as capital gains by selling securities of 79 companies.


During the year under review, the Fund has earned a gross income of Tk. 282.53 lac. by way of dividend and interest income from investment in securities of Tk. 29.67 lac. interest income of Tk. 5.21 lac. on bank deposits, capital gains of Tk. 247.65 lac. and other income. After deducting the total expenses of Tk. 155.10 lac. incurred as staff expenses, management fee, printing and stationery, postage and telegram, interest on current account with ICB, bank charges, provision against investment and others, the net income of the Fund stood at Tk. 127.43 lac. Taking into account the previous year’s undistributed income of Tk. 132.46 lac the Fund had a net distributable income of Tk. 259.89 lac as on 30 June 2010 resulting in distributable income per certificate of Tk. 519.78.

4.8.2.4 Dividend

The Fund has declared dividend at the rate of 200.00 per certificate of Tk. 100.00 each for the year 2009-10, which was Tk. 95.00 per certificate in the previous year. After making provision of Tk. 100.00 lac for payment of dividend the Fund has an undistributed income of Tk 159.89 lac., details given in Appendix-A2.

4.8.2.5 Portfolio


The ex-dividend net asset value per certificate of Second ICB Mutual Fund of Tk. 100.00 each stood at Tk. 2788.41 as on 30 June 2010.

The opening and closing market price per certificate of Second ICB Mutual Fund of Tk. 100.00 each was Tk.2244.75 and Tk. 2578.75 respectively during 2009-10.


4.8.3 Third ICB Mutual Fund

The Third ICB Mutual was established in May 1985, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 1,00,00,000 dividends into 100000 certificates of Tk. 100 each. The manager of the Fund is vested with ICB.


The Fund has earned an amount of Tk. 36.41 lac dividend and interest from 53 securities during 2009-2010 of which, Tk. 32.46 lac (89.15 percent) was received in cash within 30 June 2010.




During the year under review, the Fund has earned a gross income of Tk. 302.81 lac. by way of dividend and interest income from investment in securities of Tk. 36.41 lac. interest income of Tk. 5.38 lac. on bank deposits, capital gains of Tk. 261.02 lac. and other income. After deducting the total expenses of Tk. 118.43 lac. incurred as staff expenses, management fee, printing and stationery, postage and telegram, interest on current account with ICB, bank charges, provision against investment and others, the net income of the Fund stood at Tk. 184.38 lac. Taking into account the previous year’s undistributed income of Tk. 192.51 lac the Fund had a net distributable income of Tk. 376.89 lac as on 30 June 2010 resulting in distributable income per certificate of Tk. 376.89.

4.8.3.4 Dividend


4.8.3.5 Portfolio


The ex-dividend net asset value per certificate of Third ICB Mutual Fund of Tk. 100.00 each stood at Tk. 2190.38 as on 30 June 2010.

During 2009-10, the opening and closing market price per certificate of Third ICB Mutual Fund of Tk. 100.00 each was Tk.921.00 and Tk. 1972.50 respectively.


4.8.4 Fourth ICB Mutual Fund

The Fourth ICB Mutual was established in June 1986, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 1,00,00,000 dividend into 1,00,000 certificates of Tk. 100 each. The manager of the Fund is vested with ICB.






During the year under review, the Fund has earned a gross income of Tk. 391.99 lac. by way of dividend and interest income from investment in securities of Tk. 45.89 lac. interest income of Tk. 6.30 lac. on bank deposits and capital gains of Tk. 339.80 lac. After deducting the total expenses of Tk. 214.27 lac. incurred as staff expenses, management fee, printing and stationery, postage and telegram, interest on current account with ICB, bank charges, provision against investment and others, the net income of the Fund stood at Tk. 177.72 lac. Taking into account the previous year’s undistributed income of Tk. 190.48 lac, the Fund had a net distributable income of Tk. 368.20 lac as on 30 June 2010 resulting in distributable income per certificate of Tk. 368.20.

4.8.4.4 Dividend


4.8.4.5 Portfolio


The ex-dividend net asset value per certificate of Fourth ICB Mutual Fund of Tk. 100.00 each stood at Tk. 2387.84 as on 30 June 2010.

During 2009-10, the opening and closing market price per certificate of Fourth ICB Mutual Fund of Tk. 100.00 each was Tk.1236.25 and Tk. 2139.75 respectively.


4.8.5 Fifth ICB Mutual Fund

The Fifth ICB Mutual was established in June 1986, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 15,000,000 dividend into 150,000 certificates of Tk. 100 each. The manager of the Fund is vested with ICB.






During the year under review, the Fund has earned a gross income of Tk. 451.70 lac. by way of dividend and interest income from investment in securities of Tk. 59.84 lac. and interest income of Tk. 6.19 lac. on bank deposits, capital gains of Tk. 386.03 lac. After deducting the total expenses of Tk. 238.18 lac. incurred as staff expenses, management fee, printing and stationery, postage and telegram, interest on current account with ICB, bank charges, provision against investment and others, the net income of the Fund stood at Tk. 213.52 lac. Taking into account the previous year’s undistributed income of Tk. 117.54 lac, the Fund had a net distributable income of Tk. 331.06 lac as on 30 June 2010 resulting in distributable income per certificate of Tk. 220.71.

4.8.5.4 Dividend

The Fund has declared dividend at the rate of Tk. 100.00 per certificate of Tk. 100.00 each for the year 2009-10, which was Tk. 56.00 per certificate in the previous year. After making provision of Tk. 150.00 lac for payment of dividend the Fund has an undistributed income of Tk 181.06 lac., details given in Appendix-A5.

4.8.5.5 Portfolio


The ex-dividend net asset value per certificate of Fifth ICB Mutual Fund of Tk. 100.00 each stood at Tk. 2036.43 as on 30 June 2010.

The opening and closing market price per certificate of Fifth ICB Mutual Fund of Tk.

100.00 each was Tk.1230.00 and Tk. 1763.00 respectively during 2009-10.


4.8.6 Sixth ICB Mutual Fund

The Sixth ICB Mutual was established in June 1986, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 50,000,000 dividend into 5,00,000 certificates of Tk. 100 each.






During the year under review, the Fund has earned a gross income of Tk. 569.67 lac. by way of dividend and interest income from investment in securities of Tk. 59.70 lac. interest income of Tk. 8.74 lac. on bank deposits, capital gains of Tk. 501.23 lac. After deducting the total expenses of Tk. 116.34 lac. incurred as staff expenses, management fee, printing and stationery, postage and telegram, interest on current account with ICB, bank charges, provision against investment and others, the net income of the Fund stood at Tk. 453.33 lac. Taking into account the previous year’s undistributed income of Tk. 220.65 lac, the Fund had a net distributable income of Tk. 673.98 lac as on 30 June 2010 resulting in distributable income per certificate of Tk. 138.80.

4.8.6.4 Dividend


4.8.6.5 Portfolio

During 2009-10, the Fund has made an investment of Tk. 291.08 lac in securities of 23 companies. As on 30 June 2010 the Fund had securities of 187 companies in its

portfolio with a total cost of Tk. 1225.85 lac, the market value of which was Tk. 4162.39 lac.

The ex-dividend net asset value per certificate of Sixth ICB Mutual Fund of Tk. 100.00 each stood at Tk. 748.85 as on 30 June 2010.

The opening and closing market price per certificate of Sixth ICB Mutual Fund of Tk. 100.00 each was Tk.679.25 and Tk. 647.75 respectively during 2009-10.


4.8.7 Seventh ICB Mutual Fund

The Seventh ICB Mutual was established in June 1986, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 3,00,00,000 dividends into 300000 certificates of Tk. 100 each.






During the year under review, the Fund has earned a gross income of Tk. 688.53 lac. by way of dividend and interest income from investment in securities of Tk. 72.05 lac., interest income of Tk. 8.61 lac. on bank deposits, capital gains of Tk. 607.87 lac. After deducting the total expenses of Tk. 388.91 lac. incurred as staff expenses, management fee, printing and stationery, postage and telegram, interest on current account with ICB, bank charges, provision against investment and others, the net income of the Fund stood at Tk. 299.62 lac. Taking into account the previous year’s undistributed income of Tk. 167.69 lac, the Fund had a net distributable income of Tk. 467.31 lac as on 30 June 2010 resulting in distributable income per certificate of Tk. 155.77.

4.9.8.4 Dividend


4.8.7.5 Portfolio

During 2009-10, the Fund has made an investment of Tk. 218.46 lac in securities of 24 companies. As on 30 June 2010 the Fund had securities of 181 companies in its

portfolio with a total cost of Tk. 1341.95 lac, the market value of which was Tk. 4324.86 lac.

The ex-dividend net asset value per certificate of Seventh ICB Mutual Fund of Tk. 100.00 each stood at Tk. 1180.13 as on 30 June 2010.

The opening and closing market price per certificate of Seventh ICB Mutual Fund of Tk. 100.00 each was Tk.892.50 and Tk. 1063.00 respectively during 2009-10.


4.8.8 Eighth ICB Mutual Fund

The Sixth ICB Mutual was established in June 1986, under regulation 29A of ICB (General) Regulation with a total capital of Tk. 5,00,00,000 dividends into 500000 certificates of Tk. 100 each.






During the year under review, the Fund has earned a gross income of Tk. 755.65 lac. by way of dividend and interest income from investment in securities of Tk. 75.41 lac. interest income of Tk. 9.56 lac. on bank deposits, capital gains of Tk. 670.68 lac. After deducting the total expenses of Tk. 292.01 lac. incurred as staff expenses, management fee, printing and stationery, postage and telegram, interest on current account with ICB, bank charges, provision against investment and others, the net income of the Fund stood at Tk. 463.64 lac. Taking into account the previous year’s undistributed income of Tk. 222.23 lac, the Fund had a net distributable income of Tk. 685.87 lac as on 30 June 2010 resulting in distributable income per certificate of Tk. 137.17.

4.8.8.4 Dividend


4.8.8.5 Portfolio


The ex-dividend net asset value per certificate of Eighth ICB Mutual Fund of Tk. 100.00 each stood at Tk. 864.95 as on 30 June 2010.

The opening and closing market price per certificate of Eighth ICB Mutual Fund of Tk. 100.00 each was Tk.632.76 and Tk. 755.50 respectively during 2009-10.


CHAPTER 5PERFORMANCE ASSESSMENT OF ICB MUTUAL FUNDS

Table 12:

5.1.1 Current Ratio

Figure 3:

According to the chart, the First Mutual Fund was the highest in 2009-10 while the

Fifth Mutual Fund was the lowest in the same year. Every Mutual Fund was increased

in 2009-10 except Fifth and Seventh Mutual Funds.

5.1.2 Earning Per Share

Figure 4:

In the graph, maximum earn from per share shows the maximum profit and

company’s growth is well.

Here we see that, Earning Per Share is increases in 2009-10 from previous year of 2008-09. It is a good sign for a company. And here most EPS comes from 1st ICB Mutual Fund.

5.1.3 Price Earning Ratio

Figure 5:

In the figure, we see that, some Price Earning ratios are flow down and some are flow

up. Price Earning ratio gives an idea of what the market is willing to pay for the

company’s earnings. Lower PE ratio indicates the lower risk for investors. And higher

ratio not better for investors. Most of the ICB Mutual Fund’s Price Earning ratio goes

down. That means investors are less willing to pay for the mutual funds.

5.1.4 Dividend Payout Ratio

Figure 6:

In the graph, we see that, 1st, 5th and 8th ICB Mutual Fund is decreases and other Mutual Funds ration is increases. If dividend pay out ratio is increases this is indicates increasing capability of ICB to invest fund. And other hand if it’s decreases which indicates decreasing capability of ICB to invest fund.

5.1.5 Capital Gain on Investment

Figure 7:

In the graph, we see that, the capital gain some are increases and some are decreases. If it is maximize we can say it’s good. Authority and the committee are working

properly, but here we see in 3rd ICB Mutual Fund decreases the capital gain 28.43% in 2008-09 and direct fall to 7.38% in year of 2009-10. It’s a very bad sign of this sector.

5.1.6 Return on Investment

Figure 8:

In the figure, in every mutual fund’s return on investment are increases in 2009-10 from year of 2088-09. It is a very good scenario. Every company wants to maximize the return on investment.

5.2 SWOT ANALYSIS

5.2.1 Strengths

Credit Quality: ICB has in its credit portfolio good exposure. The practice of

good credit culture has ensured quality assets in its balance sheet.

Experienced Sponsors: Shareholders have arrived from respectable family.

Well established business house, insurance company, leading industrialists are

also in sponsorship at ICB. The paid up capital of ICB is largest in the industry

among the investment companies.

Strong Management: ICB has the backing of a strong financial management

group who advises on various management issues. Besides, people with rich

financial background are managing the day to day affairs of the company.

Strong research and development.

Ability to manage strategic change.

Skill portfolio management.

5.2.2 Weaknesses

Poor Recovery of Rental Dues: The Company is suffering gradual in

recovering its rental dues. If this continues, it may face fund crisis.

Low rate of dividend declared by the organization.

Growth without direction.

Weak network

Bureaucratic practice

5.2.3 Opportunities

Diversified Revenue Flow: Diversifying its product can be a good

opportunity. Besides offering existing products, other activities can be funds

management, merchant banking activities and other financial advisory

services.

Technological Change: Officers can be computerized to increase the

efficiency of its operation.

Finance on Small and Mid Level Enterprise: Long-term and medium term

project loans, short-term working capital loans and financing for the

establishment and expansion of micro, small and medium enterprises in the

private sector can be catalysts to the profitability of ICB.

Government tries boost up capital market.

5.2.4 Threats

Economic Uncertainties: The economy of Bangladesh as well as that of the

Investment Company is tied with that of the overseas. Rise in interest rate and

events like terrorist attacks are likely to affect the Bangladesh economy and

the margin of leasing companies.

Lack of Sufficient Legal Framework: The Lack of Sufficient Legal

Framework to penalize the defaulter of bouncing check is resulting in the

decrease of recovery rate of rental dues. It’s high time to implement adequate.

Increases in private substitute competitor.

Increase in foreign competition.

CHAPTER 6

FINDINGS, RECOMMENDATIONS & CONCLUSION6.1 FINDINGS OF THE RESEARCH

The following things are found:

Most of the Mutual Funds of ICB bear comparatively low risk.

Most of the ICB investor’s Accounts are dormant/ inoperative because of:

Granting loan facility of the investor account holders and charging higher rate of interest against loan account.

Lengthy and complicated transaction process

Most of the companies do not declare dividend up to satisfactory level which is very harmful for the mutual fund.

More time required for taking the certificate.

Lack of customer oriented innovative products

6.2 RECOMMENDATIONS

In view of the forgoing analysis and in the light of the above mentioned problem the following suggestions are recommended for the improvement of ICB and its Mutual Funds:

For high amount of reserve from the current income, the present investors are being deprived. So the management should keep minimum reserve in consistent with the net asset value.

Mutual Fund management should be free from all kinds of political and government unfair influence.

To be established operation management system software for increasing the work effectiveness.

ICB should reduce interest rate.

Management should look for sources of less costly funds and reduce expenses and increase income.

6.3 CONCLUSION

Bangladesh traditionally an agrarian economy is gradually shifting toward

industrialization. Investment plays a vital role in this emergent stage of the country.

Investment ensures development. The investment corporation of Bangladesh (ICB) is

virtually the only investment bank in Bangladesh. In a broader sense ICB is both

investment bank and development finance institutions. ICB plays its important role

for the gaining of the investor’s confidence on the capital market and further

industrial growth in our country and the development & stabilization of the capital

market. Operations of investment accounts under investors’ scheme were the corner

stone of merchandising operations of ICB. This scheme played significant role in the

country’s capital market. The small investor may effectively participate in the

industrialization of the economy along with entrepreneurial group. Over the years,

this scheme has grown tremendously with a success & failure story. Under the

restructuring program, ICB should specially continue the operations and management

of mutual fund and also concentrate to increase the performance of its mutual fund.

BIBLIOGRAPHY

ICB Annual Report 2008-09 & 2009-10

ICB Mutual Funds, Annual Report 2008-09 & 2009-10

ICB AMCL Mutual Funds, Annual Report 2008-09 & 2009-10

Ordinance and General Regulations of ICB

I. M Pandey, “Financial Management”

George Foster, “Financial Statement Analysis”, 2nd Edition.

Ross Westerfield, “Fundamental of corporate finance”, 3rd edition.

Kane and Marcus “Investments”, 4th edition.

Weygand J. Jerry, Kieso E Donald, Kimmel D Paul, “Accounting Principle”, 7th Edition.

Oxford Dictionary of Finance & Banking

www.icb.gov.bd

www.icbamcl.com.bd

www.investmentcorporationofbangladesh/mutual fund

www.sharemarketbasics.com/mutual fund

www.dsebd.com

en.wikipedia.org.

ABREVIATION

ICB = Investment Corporation of Bangladesh.SEC = Securities and Exchange Commission.

DSE = Dhaka Stock Exchange.

SEC = Chittagong Stock Exchange.

EBR = Economic and Business Research.

CDBL = Central Depository Bangladesh Limited.

IPO = Initial Public Offering.

ICT = Information and Communication Technology.

BB = Bangladesh Bank.

BDBL = Bangladesh Development Bank Ltd.

BSRS = Bangladesh Shilpa Rin Sangstha.

IAS = International Accounting Standards.

OTC = Over the Counter.

ICML = ICB Capital Management Limited.

AMCL= Asset Management Company Limited.

ISTCL = ICB Securities Trading Company Limited.

CDS = Central Depository System.

ICAB = Institute of Chartered Accountants of Bangladesh.

http://www.dsebd.com/

http://www.sharemarketbasics.com/mutual

http://www.investmentcorporationofbangladesh/mutual

http://www.icbamcl.com.bd/

ITS = Internal Transfer of Shares.

IT = Information Technology.

MIS = Management Information System.

CMDP = Capital Market Development Program.

CIP =Cumulative Investment Plan

APPENDIX

A 1: First ICB Mutual Fund -Year wise dividend performance

Financial Year Dividend Per Certificate Financial Year Dividend Per Certificate

1980-81 20 1995-96 60

1981-82 20 1996-97 70

1982-83 20 1997-98 70

1983-84 25 1998-99 100

1984-85 35 1999-00 125

1985-86 38 2000-01 170

1986-87 41 2001-02 175

1987-88 48 2002-03 180

1988-89 49 2003-04 200

1989-90 49 2004-05 210

1990-91 35 2005-06 210

1991-92 31 2006-07 190 (1B:2)

1992-93 31 2007-08 265

1993-94 45 2008-09 310

1994-95 50 2009-10 400

A 2: Second ICB Mutual Fund -Year wise dividend performance


1984-85 21 1997-98 30

1985-86 23 1998-99 32

1986-87 25 1999-2000 35

1987-88 28 2000-01 40

1988-89 29 2001-02 42

1989-90 29 2002-03 45

1990-91 22 2003-04 50

1991-92 22 2004-05 55

1992-93 21 2005-06 55

1993-94 27 2006-07 62

1994-95 40 2007-08 75

1995-96 42 2008-09 95

1996-97 45 2009-10 200

A 3: Third ICB Mutual Fund -Year wise dividend performance


1985-86 21 1997-98 35

1986-87 22.50 1998-99 38

1987-88 25.50 1999-2000 40

1988-89 26 2000-01 45

1989-90 26 2001-02 50

1990-91 19 2002-03 50

1991-92 19 2003-04 50

1992-93 18 2004-05 52

1993-94 22 2005-06 52

1994-95 27 2006-07 56

1995-96 28 2007-08 65

1996-97 38 2008-09 85

2009-10 140

A 4: Fourth ICB Mutual Fund -Year wise dividend performance


1986-87 21.5 1998-99 35

1987-88 23 1999-2000 36

1988-89 23.50 2000-01 38

1989-90 23 2001-02 40

1990-91 17 2002-03 40

1991-92 18 2003-04 45

1992-93 17 2004-05 48

1993-94 40 2005-06 48

1994-95 41 2006-07 52

1995-96 41 2007-08 60

1996-97 45 2008-09 80

1997-98 32 2009-10 125

A 5: Fifth ICB Mutual Fund -Year wise dividend performance


1987-88 20 1998-99 20

1988-89 20.50 1999-2000 21

1989-90 20.50 2000-01 23

1990-91 10 2001-02 24

1991-92 11 2002-03 24

1992-93 12 2003-04 24

1993-94 25 2004-05 27

1994-95 28 2005-06 27

1995-96 30 2006-07 33

1996-97 35 2007-08 45

1997-98 22 2008-09 56

2009-10 100

A 6: Sixth ICB Mutual Fund -Year wise dividend performance


1988-89 15.50 1999-2000 16

1989-90 13.25 2000-01 17

1990-91 6 2001-02 17.50

1991-92 6 2002-03 17.50

1992-93 - 2003-04 17.50

1993-94 16 2004-05 18.50

1994-95 18 2005-06 18.50

1995-96 20 2006-07 23

1996-97 24 2007-08 30

1997-98 18 2008-09 37

1998-99 15 2009-10 75

A 7: Seventh ICB Mutual Fund -Year wise dividend performance


1995-96 18 2002-03 14.50

1996-97 21 2003-04 15

1997-98 14 2004-05 16

1998-99 13 2005-06 16

1999-2000 13.50 2006-07 22.50

2000-01 14 2007-08 30

2001-02 14.50 2008-09 35

2009-10 70

A 8: Eighth ICB Mutual Fund -Year wise dividend performance


1996-97 18 2003-04 14

1997-98 12 2004-05 15

1998-99 12 2005-06 15

1999-2000 12.50 2006-07 18

2000-01 13 2007-08 25

2001-02 13.50 2008-09 32

2002-03 13.50 2009-10 65

Documents

Performance evaluation of icb mutual funds (main body)