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Investment Schemes for First Security Islami Bank Limited, Saver- Branch

Date of submission: ………………………..

Investment Schemes for Initial Security Islami Bank Limited, Saver- Branch

Letter of Transmittal

February…………..

D. Mizanur Rahman

Dean

Department of Business Operations

Faculty of Business & Economics

Daffodil International University or college

Subject: Distribution of Internships Report in “Investment Plans for 1st SecurityIslami Lender Limited, Saver- Branch”.

Dear Sir,

I have much pleasure to present the report of the internship program “Investment Scheam on First SecurityIslami Bank Limited, Saver- Branch”. I would like to take this occasion to express to you my sincere gratitude for the placement to me in an organization like First Security Islami Bank Limited. And for support and encouragement you have always so generously extended to me in my work. I have tried my best to get an orientation to the practical work environment and to gather all related information, and have placed my hearty effort to prepare the report accordingly directed. I hope that my report will meet your expectation and serve its purpose.

Sincerely Yours,

……………………..

(Md. Abu Taher (Nabin)

IDNo:071-11-1496

Batch : 16th (Major in Marketing)

Program: BBA

Approval certificate

Letter of Authorization

Date……………………

Profecor d.mizanur rahman

Assitant Professor

Department of Business Administration

Faculty of Business & Economics

Daffodil International University

Subject: Declaration regarding the validity of the Internship Report.

Dear Sir

This is my truthful declaration that the “Internship Report” I have prepared is not a copy of any “Internship Report” previously made by any other student.

I also express my honest confirmation in support of the fact that the said “Internship Report” has neither been used before to fulfill any other course related purpose nor it will be submitted to any other person or authority in future.

Yours truly

(Md. Abu Taher (Nabin)

IDNo:071-11-1496

Batch : 16th (Major in Marketing)

Program: BBA

Perfect or forward

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Abstract (Summary)

First Security Bank Limited (FSBL) is one of the third generation private banks in Bangladesh. FSBL commenced its commercial operations October 1999 with authorised capital BDT 1500 million and paid up capital BDT 200 million. The Bank has not yet entered into IPO. By the end of 2007, Bank’s authorised capital and paid-up capital reached to BDT 3600 million and BDT 1000 million respectively. In 2007 paid-up capital grew by 11.11%.

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Table of Contents

Topic

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List of figures

Introduction

This report is prepared for fulfilling as a requirement of both the BBA and the internship program. On this regard I have been posted in First Security Islami Bank Limited (FSIB),Rangpur branch for 3-month duration from 21-06-2013 to 21-09-2013 and regular supervised &advised by the course teacher to submit my practical learning in written form through a report. My internship topic is ” How public relation adds value in banking industry in Bangladesh: A case study on FSIBL Rangpur Branch. In this initial chapter the report will be presented with meaning of public relation, importance of public relation in banking industry, rational for internship program, reason for chosen this topic. These help to clear about my topic properly.

PR Tools and Techniques

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Creation and maintenance of a good public reputation is a complex and ongoing process. Without an effective PR, it is very difficult to reach the attention of the target audience and much less to influence their opinion and decisions. But when the relationship with the target group is finally established, it needs to be maintained in order to keep it on a high level. The process works similar to the interpersonal relationships. When two people lose contact, they pretty much disappear from each other lives no matter how close they used to be. And the same happens with the target audience if the established relationship is not maintained.

Common PR Tools and Techniques

In order to build a relationship with the target audience and maintain it on a high level, PR specialists use a variety of tools and techniques. Some of the most common ones include: • Attendance at public events. In order to attract public attention and keep it engaged with a particular organisation or an individual, PR specialists take an advantage of every public event and the opportunity to speak publicly. This enables them to directly reach the public attending the event and indirectly, a much larger audience. • Press releases. Information that is communicated as a part of the regular TV or/and radio programme, newspapers, magazines and other types of mainstream media achieves a much bigger impact than advertisements. This is due to the fact that most people consider such information more trustworthy and meaningful than paid adds.

Press release is therefore one of the oldest and most effective PR tools. • Newsletters. Sending newsletters – relevant information about the organisation or/and its products/services – directly to the target audience is also a common method to create and maintain a strong relationship with the public. Newsletters are also a common marketing strategy but PR specialists use it to share news and general information that may be of interest to the target audience rather than merely promoting products/services. • Blogging.

To reach the online audience, PR specialists use the digital forms of press releases and newsletters but they also use a variety of other tools such as blogging and recently, microblogging. It allows them to create and maintain a relationship with the target audience as well as establish a two-way communication. • Social media marketing. Like its name suggests, it is used primarily by the marketing industry. Social media networks, however, are also utilised by a growing number of PR specialists to establish a direct communication with the public, consumers, investors and other target groups.

“Seven Cs of Communication”

The “7 C’s of Communication” is a much-quoted list, first provided by Cutlip and Center in 1952 in Effective Public Relations.[2] The original list was a follows: • Completeness

• conciseness

• consideration

• concreteness

• courtesy

• clearness

• correctness

Various versions of this list, often modified and unattributed, are listed in many business, communications, marketing and public relations books and courses.[3][4][5][6][7]

1. Credibility: Communication begins in a climate of belief. This climate is built by the performance of the sender who should reflect an earnest desire to serve the receiver.

The receiver will then have high regard for the competency of the sender.

2. Context: An advertising/communications program must square with the realities of its environment. Your daily business activities must confirm, not contradict, the message.

3. Content: The message must have meaning and relevance for the receiver. Content determines the audience and vice versa.

4. Clarity: The message must be put in simple terms. Words used must have exactly the same meaning to the sender as they do to the receiver. Complex messages must be distilled into simpler terms, and the farther a message must travel, the simpler it should be.

5. Continuity and Consistency: Communication is an unending process. It requires repetition to achieve understanding. Repetition, with variation, contributes to learning both facts and attitudes.

6. Channels: Use established channels of communication—channels the receiver uses and respects. Creating new channels is difficult.

7. Capability of audience: Communication must take into account the capability of the audience. Communications are most effective when they require the least effort on the part of the recipient.[

The Importance of the Four Models of Public Relations

James E. Grunig, public relations expert and guru, has over 20 years of experience in the field of public relations. The early days of public relations knew no theories knew no theories, thus little to no thought was put into communication plans, tactics, strategies, or programs. With no theoretical foundation, public relations in many cases did more harm that good because legal ramifications, such as libel and fraud, were not considered.

This oversight and bad judgment had dire consequences (i.e.profit loss and a tarnished organizational image) that had to be alleviated and avoided in order to insure public relations’ survival. Grunig’s research has added many new theories to the body of knowledge that already exists. These theories have helped to improve the field of public relations in many ways. Public relations practitioners are better able to serve the organizational and public interest by using the best model or models listed below.

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REASON AND GREAT THINGS ABOUT AN INTERNSHIPS PROGRAM

There are many good pursue an internship:

1 . Opportunity for “hands-on” experience: Whilst students may gather significant amounts of information inside their courses, you cannot find any substitute for direct experience within a professional environment. Internships let students gain direct experience.

installment payments on your Opportunity to test various job options: We encourage qualified students to complete multiple to truly for the purpose of sampling different job areas. This permits students to find out where they could fit best in a professional environment. 3. Preparation for work searches: Students prepare maintains, write cover letters, and go through interviews as if they were applying for employment. This gives students valuable encounter in planning for career. 4. System of a portfolio: Certain to truly allow students to compile their work in a stock portfolio. This portfolio can later on be shown to potential employers.

5.. This kind of enhances the trustworthiness of the College or university and increases the credibility of the student’s degree. 6. Internship program really helps to observe useful job environment in chosen job place. 7. Research wants college students to view the internship system as an incentive to perform well academically in most of their coursework.

8. Enhancement of the maturation process: Seeing that internships need a great deal of personal responsibility, the feeling provides an important step in a person’s personal and professional growth process.

9. Confidence building: Successful completion of an internship often supplies students with professional self-confidence.

10. Specialist learning experience: The internships allows possibilities for the development of practical abilities in situations where specialist criticism is both immediate and constructive. It also provides students with opportunities to see and understand connections among coursework and skills necessary to perform successfully in a provided profession. Finally, internships aid in the identification expertise and expertise essential to doing well in a particular profession.

10. Potential job opportunities and/or associates: Occasionally to truly lead into employment opportunities. Although this is even more the exception than the regulation, internships certainly provide a pupil entry to a professional network. Contacts produced through the internships can be important sources of information for protecting eventual employment.

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Source: Fiorida Utlantic University( Arts & Letters)

Cause of choosing this kind of topic

In old period Marketing and public relations were not necessities because competition had not been as intense. Banks cannot think about dedicated customers. Financial institution perform activities by the personal interaction of bank personnel to their customers. Though marketing mix( product, price, place, personal selling, public relation) of bank is important, General public relation is also very much significant communicating, building long term lasting relationship, creating loyal customers etc . Because of absent of its bank may & must shed the opportunity to offer a personal contact with buyers To achieve this, financial institutions are purchasing marketing and pr to promote their offerings and corporate brand. The next reasons for picking this topic

To know regarding meaning & practices of public relation in bank service. To find out about public relation procedures in FSIBL.

To be aware of about effectiveness of PUBLIC RELATIONS program for producing loyal consumers. Source: By Rick Keating

First Security Islami Traditional bank Limited (FSIB) was Build in Bangladesh on Aug 29 99 as a banking company under Companies Action 1994. In September twenty-two, 1999. FSIB obtained permission from Bangladesh Bank to commence the business. The Bank offers a variety of banking providers through it is 53 twigs in the country, which includes accepting build up, making financial loans, discounting expenses, conducting funds transfer and foreign exchange ventures, and doing other related services such as secure keeping, collections and issuing guarantees, acceptances and page of credit.

At present, the lender has 66 branches which 26 divisions are in Dhaka Section, 25 twigs are in Chittagong Division, 06 limbs are in Sylet Division, 03 twigs are in Rajshahi Section, 04 divisions are in Khulna Department and 02 branches is Barishal Section.

All the 66 branches will be computerized below distributed storage space environment. An additional few divisions are planning to open up within December 2010. FSIBL has already began their across the internet, SMS and ATM banking facilities for clients.

There are 52 employees in the first stage in the bank. At present the number of staff has become roughly 856.

The lender was started with five-hundred core taka. Now it is present capital is more then simply 2, 500 core taka. The targeted depository money for savar branch was 20 lakh taka. However the branch was able to collect deposit about 18 lakh taka in a competitive market.

FSIB have create Wide Area Network through Radio, Fiber-Optics & different available connection media devices to provide any branch financial to our customers.

Customer of just one branch is currently able to put in and pull away money any kind of time of our branches. All Divisions are contained in our Extensive Area Network. No TT/DD or money carrying will be necessary.

First Security Islami Bank Limited. has officially launched TEXT MESSAGE banking support from 12 , 17, 3 years ago.

For safekeeping of client’s valuables like important documents and items like jewelries and platinum ornaments, FSIB Locker Assistance is available in a lot of the Branches in urban areas.

History of the Research

This survey has been well prepared as a dependence on my internships program. The report relies upon 1st Security Islami Bank Limited. FSIBL bank division meets the needs of person customers with various products and services. The FSIBL Banking division frequently faces difficulties and fulfills

them by developing new products and services to fulfill the specific requirements of customers.

FSIBL delivers good performance across the business and integrates new acquisitions. FSIBL further consolidates its occurrence in essential markets through significant investment in building up distribution, deepening product functionality and lunching innovative items & assistance. In the past decade there has been an instant change in the economy in the country intended for increasing the amount of Islamic industrial bank. At the same time banking location is becoming competitive as well as providers are becoming simpler and more quickly.

With the progress of time competition among nationalized private industrial banks is usually increasing day by day. And banks are putting an emphasis on on even more innovative product or service to the particular customers. To be able to survive in the competitive discipline of the financial sector all organizations are looking for better service opportunities to provide their fellow clients. So it has becoming essential for every person to have a few idea on the bank and banking process. So FSIBL should guarantee competitive goods in Client Banking Section and gauge the customer satisfaction

Range of the Analyze:

The opportunity of the study will be limited to Public regards program procedures on First Security Islami Bank Limited. This examine in fact taken within their canvas of FSIBL as a whole though the internships was completed at FSIBL, the research will certainly deal with different deposits plan and different areas of Consumer bank division in addition to a competitive examination. That is limited to the customers of First Reliability Islami Lender Limited.

Concerns of the study

Whilst nothing comes without problem, I likewise had experienced some challenges, which were found below:

➢ It was really hard to collect the information from various personnel for job restriction.

➢ FSIBL is very conventional and strict in providing private data.

➢ Respondents had been busy along with reluctant to go through the process of customer survey.

➢ The respondents at times did not gratifying in featuring accurate stats and details.

➢ The bankers are incredibly busy using their jobs, which will lead a little time consult with.

➢ The connection gap between your different staff due to work load and unavailability of data, which were confidential and lack of adequate co-operation via employees.

In spite of these limitations, I have attempted my level best to make the survey.

• Not enough time: The timeframe of this analyze was very short. I had formed only 8 weeks in my hand to total this report, which is not enough. So I could not go in interesting depth of the analyze. Sometimes the officials were busy with the day-to-day job.

• Too little data: Several desired information could not be collected due to confidentially of business.

• Other limitations: As I are newcomer, there is also a lack of prior experience in this concern. And lots of practical concerns have been crafted from any own observation that may differ from person to person.

Strategy:

It is a exploratory Research Strategy

With a view to conducting an investigation study, what is necessary is to design the framework and select the appropriate analysis methodology. A research design is simply framework or a plan for a study that may be applied as a guide in collecting and examining data. Alternatively, the research method is a way to systematically solve the investigation problem. Strategy means the underlying rules and guidelines of business of a philosophical system or inquiry treatment. There are various methods of conducting the investigation, such as- Interview Method, Observation Method, Historical Method, Statistical Approach, Questionnaire Method and the like.

Presented the nature of the present study, it can be required to gather data/information through the primary and secondary resources.

Sampling Strategy:

1 . Inhabitants: The population of this research project is described as fallow: a. Element: Existing Individual buyers of SJIBL

n. Unit: Only those customers with an account in SJIBL c. Extent: SJIBL Customers

d. Period: 8 Sept 09 – 7 12 , 09

installment payments on your Sample Shape: Individual customer those who come to SJIBL and have consideration or monetary relation while using Bank.

several. Sample size: To carry out this research the sample size was calculated by the following formula: n sama dengan (Z2 * pq)/ e2

Right here, n sama dengan sample size =?

Z sama dengan Value of confidence level (90%) from Z table = 1 . 66

G = zero. 5 Therefore , q sama dengan (1 – p)

pq = (p = 0. 5, so queen = zero. 5) = precision = 0. five * zero. 5 sama dengan 0. twenty-five

e = degree of significance (10% error) = 0. one particular

(1. 65) a couple of * zero. 5 2. 0. 5

( n sama dengan

(0. 1)2

= sixty-eight. 06

= 68 (approximately)

Hence, essential sample size for conducting this research project is 70(approx. ) clients those who are bank account holder of SJIBL.

some. Sampling Method: For performing this research the Preserve branch of SJIBL was considered to collect your data. Individual customers those who arrive to the Lender and have consideration or monetary relation together with the Bank had been selected by systematic unique sampling. To get conducting this kind of research project the probabilistic sampling procedure was followed to be able to select the sample which is straightforward random sample.

5. Data Sources: In order to meet the data requirement and collect the aforementioned information next sources has become used:

a. Primary Info Sources: Primary data has been collected in the individual consideration holder by simply questionnaire survey. Also dental conversation has been done with diverse customers in the bank.

m. Secondary Data Sources: Essential sources of second data to get conducting this research had been:

➢ Several reports and journals of Shahjalal Islami Bank ➢ Brochures and leaflets with the bank

➢ Head office circulars

➢ Total annual reports.

➢ Some unpublished data.

➢ Relevant business research books.

➢ Website in the bank

6. Data collection instruments: Data collection device is the set of questions with generally close-ended too open-ended questions.

F. Data processing:

The data has been accumulated from the customers through organized questionnaire. There after, data provides processed throughout the following techniques.

➢ In the beginning the forms has given a serial number. ➢ Customers email address details are categorized relating to their private information, present bank habit, knowledge, preference, frame of mind, behavior regarding SJIBL etc. ➢ Next customers solution are noted in number figure.

Constraints of the Study:

The internships report is definitely not free from limitations. The study has been

conducted on the subject “Investment Scheam on Initially SecurityIslami Traditional bank Limited, Saver- Branch”.

Crucial limitations in the study will be as follows:

▪ Time was one of the most mentionable restriction in setting up of the internship report. Time was very short here that restricted the access to a large number of a scopes for a extensive study. • Sufficient catalogs, publications, details and characters are not obtainable; these restrictions narrowed the way of analysis to accuracy. If perhaps those limits were not right now there, the record would be more concise and even more substantial. • It was very difficult to collect info from these kinds of a big corporation. My internship was at the Investment Scheam on 1st Security slami Bank Limited. Saver Brance For better interpretation I had fashioned to collect some information through the head office even though due to some divisional secrecies and standard confidentiality, I used to be not provided with enough information.

Limits of the Examine:

From the beginning to the end, the research has been done with the intention of making that as a full and genuine one. Nevertheless , many concerns appeared when it comes to conducting the study. During the analyze it was impossible to visit the full area have the bank although the financial assertions and other information regarding the analyze have been regarded. The study views following constraints:

▪ The time period for this study was brief.

▪ Banking legislation and Practice conflict handful of area.

▪ All the concerned personnel of the bank never have been evaluated. ▪ Deficiency of in-depth expertise and conditional ability pertaining to writing these kinds of report. ▪ Lack of knowledge.

▪ Learning total activities, complete mechanism of banking and performance of a financial institution within three months is really hard. ▪ Workers are so much busy using their regular activities and are unable to provide sufficient time for me.

▪ Bank has some insurance plan for not disclosing some data and details for apparent reasons that could be very much vital.

Findings

➢ Most of the costumers do not know the regulations in the investment settings. ➢ Deficit of human resources in Investment Section.

➢ Deposit plans favoring to the customers.

➢ Senior level management should be even more cooperative with all the subordinates.

➢ Regarding secureness service of the bank, consideration opening and closing system, phone issue, cash withdraw and pay in facility, credit profit rate, online financial, external and internal environment are adequate to the customers.

➢ The majority of the customers are service holder and businessman; they love to come to FSIBL since near to house / business office / workplace, better service, easier banking procedure. ➢ Employees from the bank are definitely more cooperative while using customers.

➢ Employees of the bank include good knowledge to solve the queries with the customers.

➢ According to the consumers opinion more ATM booths needed to be create in different locations. According to the data analysis consumers feeling about bank in FSIBL are very happy.

Recommendations

➢ Different types of products are available in FSIBL but clientele are not concerned with that so advertisement and promotional actions should be increased. ➢ Raising more deposit schemes under consumer financial. ➢ Featuring prompt services in accounts opening.

➢ Now a day, the web banking services is very much well-known in all over the world, so the traditional bank should try to build up in this part. ➢ FSIBL should enhance Debit cards & mastercard facilities. ➢ SJIBL on-line service needs to be fast & accurate.

➢ The website of SJIBL is usually not good enough; most of the pages will be under building. The webpage should be created as soon as possible.

➢ Should increase the ATM Booths.

➢ Even more manpower is needed to run the business enterprise smoothly.

➢ Employee exercising and training courses should be administered in order to provide them with knowledge and professionalism in customer connections. They should be taught about how to handle the problem of shoppers and challenging situations.

➢ Physical and technological establishments should be increased in assessing credit plans.

➢ Skilled and professional personnel ought to be kept inside the bank, that will lead to a good selection of customers ➢ SJIBL should even more focus on client needs. They have to concentrate more on their existing services and product creativity.

➢ A yearly convention with the workers should be arranged where they may exchange their very own views together with the management about different aspects. This will help to increase the efficiency of the employees.

➢ Prompt service should be directed at the customers. Regarding this arranging job rotation frequently for employees to further improve the skills in different types of service. This will likely increase the productivity of the support.

➢ More emphasis ought to be given around the customers’ problem. ➢ Simple training can be a way to boost the skills in the employee. Allocating job responsibility to the workers according for their profit. ➢ Try to build a good image to clients through distinct promotional tools

C. Realization

Shahjalal Islami Bank Limited is one of the leading Islamic sharah based industrial bank in Bangladesh. SJIBL is committed to provide excellent service to the valued clients. The management of SJIBL always provides special initiatives to uphold the interest and trust with their customers. By providing excellence services and unique effort Shahjalal Islami Lender has located itself into a strong location among all the banks. The main focus of SJIBL is to focus on the consumer require, which differentiates SJIBL with different banks. SJIBL has been effectively created a manufacturer image Islamic sharah located in the market and is also maintaining a solid position available in the market. But still it includes some weakness, which can be conveniently overcome. SJIBL has considerably more potential to explore the existing market. So , to be the number one permanently they have to become very ideal in their business.

A financial institution cannot be in a position to reach the goal until it finally makes the client satisfied by providing service as much as the customer requirements. After preparing this statement it becomes very evident to say that there ought to be a goal to make the customer constantly happy and satisfied with the service, simply then a lender can operate its business safe and soundly with this competitive time. In fine it can m said that Buyer Banking division is the office of Shahjalal Islami Financial institution which comes closure towards the customers. SJIBL has an useful & effective team with performances within an excellent manner. So , taking into consideration all the assistance of SJIBL should become more conscious to handle its buyers as the shoppers have now more choice to bank with others.

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Aims & objectives

• To conduct interest-free bank.

• To establish participatory banking instead of financial on debtor-creditor relationship.

• To invest on profit and risk sharing basis.

• To accept deposit on Mudaraba & Al-Wadeah basis.

• To establish a welfare-oriented financial system.

• To extend co-operation to the poor, the helpless and the low-income group for his or her economic acceptance.

• To play a vital role in human development and work generation.

• To bring about towards balanced growth and development of the country through investment operations particularly in the less developed areas.

• To add in reaching the ultimate objective of Islamic economic system.

Islamic Banking in Bangladesh

You will discover currently seven commercial banking institutions operating under Islamic principles. They are:

1 . Islami Financial institution Bangladesh Limited

installment payments on your Al-Arafah Traditional bank Ltd.

3. Interpersonal Investment Traditional bank Ltd

4. Exim Bank Ltd

five. Shahjalal Islami Bank Ltd.

six. Icb Islamic Bank Ltd

several. First protection Islami Bank Ltd.

ISLAMIC MODES FINANCING

At the beginning it is better to offer a clear meaning of “Islamic Methods of Finance”. The word “Modes” literally means “methods”, or in other words, that refers to systematic and thorough rules, requisites and procedure for be used for completing a specific factor. The thing that must be accomplished through this context is usually, however , the niche matter of each of the said methods, i. elizabeth. any of the different types of investment activities (trade, procurment, real estate, manufacturing, agriculture, farming production etc ., or, applying Shariah expression Murabaha, Mudaraba, Musharaka, Ijarah, Istisna, etc . ).

The term “Finance” in one of it is different meanings refers to the provision of money capital or credit rating, provided by whether person (household), or an organization (private or public – financial or non financial). The word “Islamic” is inserted in the over expression limit the type of guidelines that can control different ways of fund to the Shariah rules. A complete definition to get the term “Islamic Modes of

Finance”‘ may be presented as follows:

BAI-MURABAHA

The terms “Bai-Murabaha” have been derived from Arabic terms Bai and Ribhun. The word ‘Bai’ means purchase and sale as well as the word ‘Ribhun’ means a great agreed upon profit. “Bai-Murabaha” means sale for an decided profit. Bai-Murabaha may be understood to be a contract between a purchaser and a seller beneath which the retailer sells certain specific merchandise permissible under Islamic Shariah and the Law of the area to the client at an expense plus a great agreed upon profit payable today or in some particular date in the future in lump-sum or perhaps by installments. The profit could possibly be either a set sum or based on a percentage of the price of the merchandise.

MUSHARAKA (PARTNERSHIP)

The phrase Musharaka comes from the Persia word Sharikah meaning alliance. Islamic jurists point out the fact that legality and permissibility of Musharaka is dependent on the injunctions of the Qura’n, Sunnah, and Ijma (consensus) of the students. It may be noted that Islamic banks are more likely to use different forms of Shariakt-al-Inan because of its integrated flexibility. In a Islamic financial institution, a typical Musharaka transaction could possibly be conducted in the following fashion.

One, two or more entrepreneurs strategy an Islamic bank to request the financing required for a project. The bank, along with other associates, provides the important capital to get the task. All partners, including the lender, have the directly to participate in the project. They will also postpone this right. The profits have to be distributed relating to an decided ratio, which in turn need not become the same as the capital proportion. However , losses will be shared in exactly the same proportion in which the different partners possess provided the finance intended for the job.

MUDARABA

The term Mudaraba refers to a contract between two parties through which one get together supplies capital to the other party for the purpose of engaging in a business activity with the realizing that any income will be shared in a mutually agreed upon. Deficits, on the other hand, would be the sole responsibility of the service provider of the capital. Mudaraba is likewise known a Qirad and Muqaradah.

Mudaraba is a deal of those with capital with those who have expertise, where the initially party supplies capital plus the other party offers the expertise while using purpose of getting Halal (lawful) profit which will be shared within a mutually agreed upon proportion. This type of business venture provides the interest from the capital owner and the Mudarib (agent).

BAI-SALAM

Bai-Salam is a term used to establish a sale when the buyer makes advance repayment, but the delivery is postponed until some time in the future. Generally the seller can be an individual or business and the buyer is the bank.

ISTISNA’A SALE

The Istisna’a sales is a deal in which the price is paid beforehand at the time of the contract as well as the object of sale is usually manufactured and delivered later on. The majority of the jurists consider Istisna’a as one of the categories of Salam, Therefore , it can be subsumed underneath the definition of Salam. But the Hanafie school of Jurisprudence classifies Istisna’a as an independent and distinct contract. The jurists of the Hanafie School have given several definitions to Istisna’a many of which are: “That it is a agreement with a company to make something” and “It is a deal on a item on legal responsibility with the dotacion of work”. The Customer is called ‘Mustasnia’ contractor and the seller is referred to as ‘Sania’ maker or manufacturer and the thing is called ‘Masnooa’, manufactured, constructed, made.

QARD HASAN (Benevolent loans)

Qard Hasan is a contract in which among the parties (the lender) areas into the title of the other party (the borrower) a definite courier of his property, in return nothing more than the eventual come back of some thing in the same value from the property loaned.

BAI-MUAJJAL (Deferred Sale)

The conditions “Bai” and “Muajjal” will be derived from the Arabic phrases ‘Bai’ and ‘Ajal’. The phrase ‘Bai’ means purchase and sale plus the word ‘Ajal’ means a fixed time or maybe a fixed period. “Bai-Muajjal” can be described as sale for which payment is created at an upcoming fixed time or within a fixed period. In short, it is a sale upon credit.

The Bai-Muajjal may be defined as an agreement between a buyer and a retailer under that this seller sells certain certain goods, permissible under Shariah and regulation of the nation, to the client at an agreed fixed selling price payable at a certain set future time in lump sum or in fixed repayments.

IJARAH

Fuqaha (jurists) have defined Ijaraha as ownership of a benefit to get consideration. Also this is known as rental or Hire contract. Al-Ijarah is an Arabic term. This has been created from the Arabic term “Ujr” or “Ujrat” which means ‘consideration’ or ‘return’ or ‘wages’. According to Islamic Shariah (jurisprudence), Ijarah is a contract between two parties – the smaller and the lessee, where the lessees (Hirer or Mustajir) have the right to enjoy/reap a specific benefit against a particular consideration/rent/wages in the lessor – the owner (Muajjir).

Operational Tactics of Islamic Bank

TYPES OF FUNDS

The money of the Islamic banks consist of ordinary capital resources composed of paid-up capital and stores, and funds rose through borrowings through the central traditional bank and other banking institutions (inter-bank borrowing), and concern of Islamic financial devices. The major element of their functional funds is usually, however , produced from the different kinds of deposits accepted on the Islamic principles of Al-Wadiah (safe custodianship) and Mudaraba (trust financing). In the interest of ease of understanding we call up these two resources as ‘Primary’ and ‘Secondary’. These are reviewed as below.

PRIMARY RESOURCES

Paid-Up Capital

Islamic banks are public limited companies integrated under the businesses Act, which are listed on the Stock Exchange. Individuals and institutions, local and international, have activated their capital. For example , the First Islamic bank of Bangladesh – Islami Lender Bangladesh Limited (IBBL)- is known as a joint venture of Bangladesh and overseas capital in the rate of 38: 62. Their local capital is owned or operated by the Govt of Bangladesh and private individuals and organizations. Reserves

The central lender also requires that every Islamic bank shall maintain a reserve fund. Before any dividend is usually declared, a great Islamic traditional bank shall transfer to the arrange fund out of your net income of each year, after because of provision has become made for Zakat and taxation, a certain percentage of the net profits to be able to build up adequate reserves. In case the central traditional bank is satisfied the aggregate arrange fund of an Islamic lender is satisfactory for its business, it may simply by order in writing exempt the financial institution from this requirement for a period of 1 year. In Bangladesh, the IBBL besides maintaining the statutory arrange, has built up an Investment Loss Offsetting Book (ILOR) simply by appropriating 15 (ten) percent of the bank’s annual investment profits. Investment funds available

Every Islamic bank can be further necessary to keep always minimum sum of investment funds available against it is deposit financial obligations expressed while certain percentage of the deposits, because may be recommended from time to time by notice in writing by the central bank. For this specific purpose, liquid assets mean (i) profit bank, (ii) balances with the central bank/other designated banks, (iii) Federal government Investment Records, and (iv) such other assets because may be approved by the central bank. Failing to keep the minimum funding available invokes fees for each day of deficit. Borrowing Coming from Central Bank

To tide over momentary liquidity disadvantages Islamic banking institutions, as affiliate banks, are entitled to borrow from the central lender, as the lender of last resort.

In such cases, IBBL does not spend interest just like the conventional banking institutions. Such asking for from the central bank is treated like a PLS first deposit with the Islamic banks and profit is paid at the rate payable on corresponding PLS put in of the bank. Inter-Bank Credit

The Islamic banks have established interest-free fund arrangements with local and foreign uses the basis of reciprocity. Normally, under before arrangement, the Islamic financial institutions keep excessive funds with selected banking companies. When needed, these types of banks likewise place interest-free compensating equilibrium with the Islamic bank. In the event that balances are certainly not equal, after that periods which is why funds positioned are adjusted.

SECONDARY OPTIONS

Islamic banking is a response to such exigencies. That mobilizes financial savings of the the general public in line with Islamic Shariah. Tactics employed by Islamic banks intended for saving breaking down are the following.

Al-Wadiah Accounts

Islamic banks get deposits in their Al-Wadiah account. This consideration is similar to the need deposit accounts of interest-based banks. Conventional interest-based banking institutions do not pay out interest about this type of first deposit account. In addition , depositors might withdraw any a part of the funds transferred in this consideration without limitation. The term Al-Wadiah means deposit of money enabling somebody to claim the funds in the bank account. The bank since trustee preserves and safe retains the funds deposited. Therefore, depositors truly feel safe keeping their money together with the bank as the bank supplies assurance of returning their cash on require. General Mudaraba Account

The Mudaraba bank account of Islamic banks differs from the others from the checking account of an interest-based bank. Mudaraba is a form of business deal where a single party products money as well as the other handles the business simply by investing labor and time. Profits produced from the enterprise are shared by both in a percentage agreed upon during contract. Yet , in this set up, the investor is entirely responsible for virtually any loss that may be incurred. The financier with the business is called Sahib al Mal, Rabbul Mal or owner of the capital and the administrator of the business is called Mudarib or businessperson.

Term Mudaraba Account

Islamic banking companies also get term pay in from their clients. The term put in is, of course , altogether unlike that of the interest-based banking companies. Fixed term deposits received by Islamic banks are “Term Mudaraba Deposits”. Generally an Islamic bank obtains these types of deposits for a minimum amount of 3 months to 3 years on the maximum.

Your bank invests the cash, and shares any profits with the depositor based upon a portion agreed upon in the time contract. In the case a loss in incurred, depositors reveal the loss in proportion to the deposit in their accounts. At the end of the term the contract terminates and the depositors withdraw their money, plus or minus any gains or losses. The depositors, in the event that they just like, can again deposit their cash for a fresh term under a new deal. No checkbook is issued against a Term Mudaraba Deposit, however , Term Mudaraba Certificate is definitely provided towards the depositor.

Term Mudaraba Bank account

Islamic banks likewise receive term deposit using their clients. The term deposit is, of course , totally different from regarding the interest-based banks. Fixed term build up received by Islamic banking companies are called “Term Mudaraba Deposits”. Generally an Islamic traditional bank receives these kinds of deposits a minimum period of a few months to 3 years at the maximum.

The bank spends the money, and shares any profits while using depositor based on a percentage agreed upon at the time of contract. In the event a loss in incurred, depositors share losing in proportion for the deposit inside their account. Towards the end of the term the deal terminates plus the depositors pull away their money, plus or without any profits or failures. The depositors, if that they like, can again pay in their money for a new term under a fresh contract. Simply no checkbook is issued against a Term Mudaraba Pay in, however , Term Mudaraba Qualification is supplied to the depositor. Special Mudaraba Account

When an Islamic bank receives a Mudaraba first deposit for expense in some particular business, sector, or job, the first deposit is called a “Special Mudaraba Deposit”. In this case, a great Islamic lender, while obtaining deposits, involves an agreement while using depositors the money to become received will be invested in some specific organization such as the fertilizer or salt business; or in some specific sector like the industrial sector, textile sector, export-import sector; or in a few specific expenditure sector from the bank just like real estate, shipping and delivery or a special project. Income earned by these types of specific projects are distributed between bank as well as the Special Mudaraba depositors based a recently agreed to percentage. As before, in the event of a loss, the depositors discuss the loss in an amount proportionate to their debris in the consideration.

Central Banking in Islamic Framework

Introduction

The central bank gets the sole authority to concern money (currency) and the responsibility to regulate the banking program in order to protect the value of cash and know the different objectives of monetary plan. Money is the method of exchange and the commonly accepted method of payment, and thus as a measure of value. Increased fluctuations inside the value pounds lead to economic distortions and causes social inequities. Inflation offers windfall benefits to the wealthy and the entrepreneurs but causes hardship for the fixed and low-income groups by eroding their getting power.

More serious still, deflation often deprives the latter of their employment and means of livelihood. The trends of inflation and decrease are characteristic of the economic climate based on the institution of interest, which is prohibited in Islam.

Objectives of monetary policy in Islam

Consistent with the Islamic ideals of social justice, equity, fairness and equilibrium, there are three major targets of economic policy within an Islamic economy, which discards interest. These kinds of objectives happen to be: • Stableness in the benefit of money;

• Economic health and wellness with complete employment and optimum charge of financial growth; and • Distributive justice.

For a proper appreciation of the above-mentioned goals of monetary policy and how these might be realized, they may be explained beneath.

Stability in the value of money

In an Islamic economy, it can be almost mandatory on the central bank aid the value of funds. Thus, the central traditional bank should let expansion of money supply for the extent it truly is justified by a possible contribution to progress in actual balances. The stability in the worth of money must be accorded substantial priority because of the unequivocal stress of Islam on trustworthiness and fairness in all individual dealings, also because of the bad impact of inflation upon socio-economic rights and basic welfare.

However rather than total, this goal would mean family member stability inside the general selling price level. Absolute price balance is nor feasible nor desirable as it may conflict with the optimum development and total employment target of the monetary policy.

Economical Growth and Employment

While inflation is definitely incompatible with the goals of your Islamic economy, prolonged economic downturn and unemployment that cause human sufferings are also unsatisfactory. Monetary coverage has, therefore , to aim a high rate of financial growth with full job and using productive resources. However , optimization of economic growth per se and at every costs is not the objective of monetary policy in an Islamic economy. Materials prosperity shall be attained in the framework of Islamic principles.

It should certainly not be obtained through the creation of necessary and morally – sketchy goods and services. It should not bring about an increased and overly-rapid use of Allah-given resources with the expense of future ages, and it should not become harmful to present or upcoming generations by simply degenerating the moral and physical environment.

Environmental degeneration with destruction and destruction of property, water and forest solutions and significant air and water pollution are actually matters of big concern all over the world. Hence the concept of “sustainable development”, which means conference the needs of the present generation without compromising the needs of future generations.

Economic expansion and sound environmental management happen to be complementary areas of the same goal. Without sufficient environmental security, development will be undermined; with no development, environmental protection will certainly fail.

Distributive Justice

Financial policy should be used definitely to promote the purpose of distributive rights and prevent attentiveness of riches and financial power in an Islamic overall economy. However , too much concern with distributive justice in formulating and implementing budgetary policy may well adversely impact its overall efficiency and effectiveness in attaining the other desired goals of monetary policy. elizabeth. g. expansion, employment and development. Reduction in income inequalities and important redistribution should be an important insurance plan objective of an Islamic condition and hence the domain, generally, of it is fiscal coverage. Monetary policy can lead to this goal.

Problems and Challenges of Islamic Financial in Bangladesh

1 . Nature from the Problem and Challenges

The Islamic financial institutions in the world have been facing a quantity of challenges. Alongside, the Islamic banking in Bangladesh is likewise facing several problems of challenges. First, they have not yet been successful in devising a great interest-free device to place their particular funds on the short-term basis. They encounter the same injury in financing buyer loans and government failures. Second, the chance involved in profit-sharing seems to be so high that the majority of the Islamic banking companies in Bangladesh have resorted to those approaches of financing which bring them a fixed certain return. Therefore, there is a lot of genuine criticism that these financial institutions have not abolished interest however they have, actually only altered the nomenclature of their orders.

Third, the Islamic financial institutions do not have the legal support of the Central bank in Bangladesh, might not have the necessary knowledge and skilled manpower to appraise, screen, evaluate a great audit the projects which can be required to fund. As a result, they can not expand inspite of having large excess financial liquidity. The implementation of your interest-free bank in Financial raises several questions and potential problems which can be viewed from the macro and tiny operational standpoint. A partial list of the problems confronting Islamic banks in Bangladesh involves.

2 . Challenges Related to Macro Operation of the Islamic Financial institutions

• Fluidity and Capital

• Valuation of bank Assets

• Financial Stability

• The Ownership of Banking companies

• Lack of Capital Market and Interest-free Economical Instruments • Insufficient Legal protection

• Managing and Oversight by the Central bank on such basis as Islamic Shariah • Insufficient Unified Shariah Rulings

• Lack of Islamic Inter-Bank Money Market

• Fresh Banking Rules

• Accounting principles and Types of procedures

• Shortage of Supportive and Link Institutions

• Deficit of Skilled and Trained Manpower in Islamic Shariah financial • Lack of Co-operation among the list of Islamic Banking institutions

• Lack of Familiarity by Foreign Financial and Non-financial Sector with Islamic Products and methods. • Extreme Competition inside the Financial Sector

• Economics slowdown and Political Situation from the Country • Inadequate History of Islamic Bank

• Absence of Infrastructure for International Islamic Transact Financing • Defaulting Tradition of the Consumers

• Short-term Property Concentration in the Islamic Banking institutions

• Lack of Training course or newspaper on Islamic Economics, Banking and Finance at the Educational Institutions. • Deficiency of Uniform Detailed procedure of Islamic Bank • Not enough Specialised Islamic Banks and nonbank financial Institutions • Deficiency of Consortium or Syndication with the Islamic Banking companies • Not enough Harmonization of Islamic financial Practices • Lack of Inter-country Study within the practical Procedures of Islamic Banking • Lack of Second Securitisation Industry

• Not enough Coordinated Study on Islamic Economics, Banking and

finance • Lack of Apex Training Commence for the Islamic Banks.

Problem Linked to Micro Operation of the Islamic Banks:

• Increased Expense of Information

• Control of Cost of Funds.

• Mark-up Financing and Dangerous Mark-up

• Excessive Resort to the Murabaha Method of Funding

• Utilization of Interest Rate of correcting the Profit Perimeter in Bai-Modes • Funding Social Concerns.

• Lack of Confident Response to the Requirement of government Auto financing. • Inability of Islamic Banks to Finance Excessive Return Jobs. • Sacrifice of allocative Efficiency

• Loss of Distributive Efficiency.

• Depression of Profit.

• Deficiency of Full-fledged Shariah Audit.

• Fraud-Forgery or problem in Islamic Banks.

• Minimal Budget for R and d.

• Working Environment.

• Issuance of Letter of Ensure (L/G)

• Minimum Budget for Research and Development.

• Lack of Shariah Manual or Guidelines.

• Islamic Investment Risk Analysis and measurement Methodology. • Non-exemption of Stamp Duty for choosing Property by Banks. • Lack of Co-operation between Islamic Banks and Islamic NGOs for advancing Microcredit. • Lack of Institution of Relates to other Schooling Institutes and Shariah Supervisory Bodies. • Lack of Purpose of the Administration to be tight with Shariah Guidelines. • The above problems are some of the burning problems dealing with the Islamic banks in Bangladesh. Nevertheless it is experienced that much operational work and in-depth research work has to be carried out to allow the Islamic banking institutions to blossom with highest quality and strength.

The Future of Islamic Banking in Bangladesh

1 . Requirement of Re-organization from the Whole financial System

Overview of the problems of Islamic banking in general and Islamic banks of Bangladesh in particular positions a challenging feature pertaining to the promo and success of Islamic banks in Bangladesh. The policy inference is not that Islamic banks should never be floated within the conventional bank framework.

Rather it is the standard banking program whose detailed mechanism has to be re-examined and converted into COULD YOU system looking at beneficial impact of the latter on the economy. However , provided that Islamic banking companies are to run within theconventional banking construction, the advice under the next heads might be taken note of.

2 . New banking philosophy pertaining to the Islamic Banks

There seems to be considered a gap involving the ideals and actual practice of Islamic banks in Bangladesh. In their reports, pamphlets, bulletins and posters generally there banks share their dedication to seeking establishing a just contemporary society free from exploitation. Study shows that a little progress has been accomplished so far in that particular direction. Though this kind of failure is usually attributed primarily to the pervasive influence of conventional bank system alone, lack of watchful of the marketers of Islamic banking in realizing the objective is no significantly less to blame. There should be a through review of plans that have been pursued by these banking companies for about ten years and parts of departure need to be identified to redesign their particular of action.

3. Future Policy and Strategy

The initially action that deserves quick attention is a promotion with the image of Islamic banks as PLS banks. Strategies have to be carefully invented so that the image of Islamic personality and solvency as a bank is together promoted. For this end, Initial schemes in some very chosen areas must be started to test innovative concepts with profit-loss-sharing modes of financing as major aspect.

Islamic banking companies should clearly demonstrate by their actions that their banking practices will be guided simply by profitability criterion thereby establishing that only Islamic banking methods ensures effective allocation of resources and give true marketplace signals through PLS settings. Islamic banks should continuously monitor and disseminate through various means the impact with their operations for the distribution of income generally between the financial institution and the other two parties: the depositors and the business people, and then in different profits groups of the society. These types of presuppose institution of a totally equipped study academy in each Islamic bank.

some. Stepping for Distributional Efficiency.

The task is more difficult for Islamic banks, as they have bottom promote their particular distributional productivity from most dimensions combined with profitability, Islamic banks, comprehensive, have to be converted into profit-loss-sharing financial institutions by increasing their percentage share of investment auto financing though COULD YOU modes. The Islamic banking institutions, to do that, can be selective in choosing consumers for auto financing under PLS modes. They should establish direct functional romance between the salary of the depositors and involving the income the income from the bank which of the business people. The relationship increases with reveal of bank financing below PLS ways increases.

five. Promotion of Allocate Productivity

The Islamic banking companies can boost their allocate productivity be fulfilling social well being conditions in the following method. First, they must allocate an affordable portion of their investible cash in interpersonal priority areas such as culture (including poultry and fishery), small and new industries and export-led sectors like dress, shrimp farming. Secondly, when the percentage stocks and shares of portion of investible funds happen to be determined among the sectors of investment funding, profitability of projects need to be the criterion pertaining to allocating expenditure funds. The criterion will be best satisfied if more and more projects were financed underneath PLS ways.

6. Modern day banking Guidelines and techniques

Islamic financial institutions, with a view to facing the growing competition either fellow-Islamic banks or maybe the conventional financial institutions which have released Islamic financial practices, must adapts their very own functioning based on modern organization practices, nevertheless improvement and expansion in the range of getting the bank sector. Hence, it is necessary to enable them to provide comprehensive banking and investment providers to customers and simultaneously to take advantage of contemporary technological breakthroughs in areas such as electric communication, computerization etc .

several. Government and Central bank Responsibilities

Government will need to think actively for the promotion of Islamic financial in Bangladesh considering its pro-development function. It should amend existing economical laws, serves and polices to create beneficial environment favorable to soft operation of Islamic banks. The bank Reforms Committee could possibly be entrusted to draft a great Islamic Bank Act.

Federal government should also let establishment of Islamic insurance and other part companies in order to facilitate their particular operation. Bangladesh Bank should develop a few Islamic Budgetary and keeping instruments and create individual window to get transactions while using Islamic banking institutions and a full-fledged Islamic banking Office for inspecting, supervising, monitoring and guiding purpose, therefore facilitating Islamic banks for his or her smooth advancement in Bangladesh.

8. Inter-Islamic Bank Co-operation and Point of view Plan

All Islamic banks will need to come forward to help each others and adopt a perspective prepare say intended for 20 years for Islamization with the banking system of Bangladesh. To actualize this mission, they have to set-up quickly and Apex Research Academy and Training Institute built with modern tools. Books and other accessories.

Leads of Islamic Banking in Bangladesh

In my understanding the prospect of Islamic Banking is very shiny. Muslim people everywhere want Islamic Financial. In Bangladesh, to give an example, 15 standard Banks have opened independent Islamic limbs recently. Five hundred applications happen to be pending with Islamic Lender Bangladesh Limited. for opening of new braches. IBBL has already 132 limbs in the country. The positioning may not be same in all countries. But if Islamic Banking succeeds in any region, the positions will same in every Muslim country in my judgment.

This means, that initially Islamic Lender in any region should be very well managed and successful so that people have faith in this system. Established Islamic Banks ought to co-operate by simply lending qualified officials in setting up new Islamic Financial institutions. The problems mentioned in the preceding pages are generally not insurmountable. Most of them can be solved with more research and committed efforts.

IDB, OIC Fiqh Academy, International Islamic Banking organizations and individual Islamic banks will need to put more resources in research in Islamic Financial, Finance and Economic problems. Cooperation of Central Banks plus the Governments will probably be needed in a few areas. I’ve no doubt in mind that Islamic banking can expand more and more in the world.

Performance in the Islamic Financial System

Comparative location of the Islamic Banking sector in

Bangladesh, 3 years ago

(In million TK. )

|Group Banks |Deposit |Investment |Excess liquidity|Manpower |Branches | | | | |asset | | | |Islamic Banking |288557 |284547. 2 |7742. 4 |8220 |308 | |sector | | | | | | |All private Banking companies |912240. 5 |787575. two |41863. one particular |32576 |1573 | |All Banks Total |1463163. six |1220912. a couple of |98126 |108451 |6336 |

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The growth of Islamic banking in Bangladesh is usually progressing everyday. The exceptional shift or perhaps conversion with the conventional banking companies and their branches into Islamic lines shows the signal an excellent source of acceptance in the interest-free bank by the general public in general. The Islamic financial industry extended to show solid growth in 2007 together with the growth in the economy, since reflected in the increased business of the Islamic banking industry in terms of resources, financing, and deposits with the total financial system.

The Islamic financial institutions in Bangladesh started coming from a very limited resource basic.

But with the passage of your energy, they have shown strong functionality in respect of breaking down of deposit. Total deposit of the Islamic banks and Islamic financial branches of conventional financial institutions stood in Taka 188557. 4 mil in Sept, 2007. It was 27. 6% of the build up of all non-public banks and 12. 9% of the deposit of the total banking program. Total expenditure of the Islamic banks and the Islamic financial branches of the conventional banking companies stood at Taka 184547. 2 , 000, 000 at the end of September, 2007. This was 31. 4% of private financial institutions and 12-15. 1% in the total financial system of the.

The Statutory Liquidity Necessity (SLR) intended for the Islamic banks is definitely fixed for 10% since the inception from the first Islamic Bank in 1983. This remains unchanged till day while SLR for the conventional commercial banks has been transformed many times, which will presently is definitely fixed in 18%. It truly is evident by Table 1 that almost all of the Islamic banking companies have been facing excess fluid problem while only one financial institution, the Oriental Bank Limited, is retaining liquidity situation below the essential level.

Yet , the excess fluid of the Islamic banks and Islamic bank branches of conventional banks as of September 2007 was going to the tune of Taka 7742. four million (18. 5% of personal banks and 7. 9% of all banks), which originated mainly due to the non-responsiveness of good borrowers for credit require and the absence of adequate interest-free financial instruments in the country.

Islamic banks as well as the Islamic financial branches in the conventional banking companies have created enough employment opportunities in the banking sector by providing several jobs to folks. The total people employed in the Islamic bank system were 8220 while on Sept. 2010, 2007. This is 25. 2% of the non-public sector banks’ total career and several. 6% of all banks.

The entire number of limbs of the Islamic banks, including the Islamic banking branches with the conventional banking institutions, in the country was standing at 308 in Sept. 2010, 2007, which 236 had been urban and 72 had been rural. The number of Islamic financial institution branches was 19. 6% of all exclusive banks and 4. 9% of the financial system of the.

SWOT examination

Strength

�� Diversified ownership routine

�� Strong business

�� Good Monetary performance

�� Very good investment portfolio

�� Comfortable Fluid position

�� Skilled management crew

�� Sound HR development programs

�� Improvement in automation

�� Wide branch network

�� Significant involvement in corporate social responsibility

Weakness:

�� Unrivaled asset vs . capital development

�� Limited delegation of electricity

�� Limited modern day customer service features

�� Moderate restoration of rescheduled investments

�� High large investment exposures

�� Primary stage of system primarily based internal control procedures

Options:

�� Investment in SME and Agro primarily based industry

�� Real-time online banking

�� Credit card in dual forex

�� Creation of Islamic Money market product

�� Present above your five years Islamic bond

Threats:

�� Market pressure for raising the SLR CAMERA

�� Overall liquidity crisis in money market

�� Government pressure to minimize investment level

�� Increase the capital adequacy placement

Conclusion:

The financial system of Bangladesh is composed of many different banks operating as

Nationalized CommercialBanks (NCBs), Private Banks, Foreign Banks, Specialized Banks and Development Financial institutions. However , twenty-eight outof 55 banks in Bangladesh happen to be private, that only 7, namely Islami Bank Bangladesh Limited, ICB Islamic Traditional bank, Al-Arafah Islami Bank Limited, Social Purchase Bank Limited, Exim Financial institution, Shahjalal Financial institution and Initial security Bank Ltd had been operating because Islamic banking institutions. Besides these types of full-fledged Islamic banks, 12 conventional banking institutions in the non-public sector have got opened twenty-five full-fledged Islamic banking branches and Islamic Banking Counter respectively to deal with the Islamic banking organization parallel to their conventional operations.

References:

01. www.dsebd.org

02. www.islamibankbd.com

goal. Bank Pay for Management by A. R Khan

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