General Banking and Various Schemes of Jamuna Bank Limited

General Banking Division of Jamuna Bank Limited

Jamuna Bank Ltd is one of the most well known private in our country. It undertakes all type of banking transactions to support the development of trade and commerce in the country. Above all of their service they go through their objectives such as earning and maintaining CAMEL rating strong, establishing relationship banking, introducing fully automated systems, ensuring an adequate rate of return on investment, maintaining adequate liquidity to meet maturity obligations, pursuing an effective system of Management by transparency and accountability at all levels.

As a part of fulfilling their objectives through their customer JBL offers the following accounts: Current Deposits, Savings Bank Deposits, Fixed Deposits, Short Term Deposits, Monthly Term Deposits, Any other deposits as may be approved/ advised by Head Office.

In General Banking, Clearing department receives cheques, DD, P.O. etc from depositors attached with a deposit slip.

The branches of the bank operate as independent accounting unit. They submit statement of affairs and other prescribed returns direct to Head Office where these are consolidated in the form of a statement showing assets and liabilities of whole Bank as at the close of business on Thursday and at the last working day of each month.

The system of transactions of the bank is essentially double entry system of book keeping. But for quick and accurate recording as well as for arriving at daily financial position specialized form of double entry system book keeping, named slip system under self‐balancing method is followed by the bank. The golden principle of debiting or crediting is the same as those of double entry system. In the bank, instead of recording transactions in a journal initially, these are directly recorded and posted in the ledger (computer) separating the debits and credits by slips or voucher system.

Foreign exchange is an important department of Jamuna Bank Limited, which deals with import, export and foreign remittances. It bridges between importers and exporters. This department is playing an important role in enhancing export earnings, which aids economic growth and in turn it helps for the economic development. On the other hand, it also helps to meet those goods and service, which are most demandable and not adequate in our country.

Origin of the Report

One of the most important factors for industrialization and economic development of a country is the availability of the credit facility. The continuing crisis of accumulation of non‐ performing and default banking loans has emerged as most of the serious constraint in the path of economic development of Bangladesh as banking remains the main intermediary vehicles in harnessing capital for accelerating the growth of the productive sectors in Bangladesh in the absence of a healthy capital market. But providing loans without proper appraisal are even more dangerous as the depositors are put into great risk of losing their money and at the end, the crisis might go beyond overcome. So, I think it is very important to gather the technical know‐how regarding the critical analysis of credit approval procedure practiced by the Jamuna bank ltd. by preparing this report.

Objective of the Report

To know about the banking sector of Bangladesh.
To be accustom with the management policy or process of JBL in Bangladesh.
To get an overall idea about the management policy of JBL as well as commercial Bank.
To know the operation of commercial banks in Bangladesh.
To describe the customer service process of JBL Bank Limited.
To analyze the barriers faced by the banks in Bangladesh.
To suggest a supportive role in the progress of banking system in financial sector.
To know about the objectives and planning of JBL.
To know how the branches are efficiently controlled.
To identify whether all process are perfectly and effectively practiced or not.
To find out the sectors in which such types of problems exist

Methodology of the Report

Research Design

This report is based mainly on observations that I experienced during the internship period. Data required for this report were collected from the annual report of Jamuna bank. Apart from these, helpful information was collected from online resources.

Bavkground

Jamuna Bank Limited (JBL) is a Banking Company registered under the Companies Act, 1994 with its head office at Chini Shilpa Bhaban, 33 Dilkusha, Dhaka‐1000. The Bank started its operation from 3rd June 2001.

Jamuna Bank Limited is a highly capitalized new generation Bank started its operation with an authorized capital of Tk.1900.00 million and paid up capital of Tk.390.00 million, as of December 2008 Paid up capital of the Bank raised to Tk.1072.5 million and number of branches raised to 47 (Forty seven).

JBL undertakes all type of banking transactions to support the development of trade and commerce in the country. JBL’s services are also available for the entrepreneurs to set up new ventures and BMRE for industrial units. The Bank gives special emphasis on Export, Import, Trade Finance, SME Finance, Retail Credit and Finance to Women Entrepreneurs.

To provide clientele services in respect of International Trade it has established wide correspondent banking relationship with local and foreign banks covering major trade and financial centers at home and abroad.

Vision

To become a leading banking institution and to play a pivotal role in the development of the country.

Mission

The Bank is committed to satisfying diverse needs of its customers through an collection of products at a competitive price by using appropriate technology and providing timely service so that a sustainable growth, reasonable return and contribution to the development of the country can be ensured with a motivated and professional work‐force.

Sponsors

The sponsors of Jamuna Bank Limited are successful leading entrepreneurs of the country having stakes in different segments of the national economy. They are eminent industrialist and businessman having wide business reputation both at home and abroad.

Management

JBL is managed by highly professional people. The present Managing Director of the Bank is a forward looking senior banker having decades of experience and multi discipline of knowledge to his credit both at home and abroad. He is supported by an educated and skilled professional team with diversified experience in finance and banking. The management of the bank constantly focuses on the understanding and anticipating customers’ needs and offer solution thereof.

Corporate Culture

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

The client comes first.
Search for professional excellence.
Openness to new ideas &new methods to encourage creativity.
Quick decision‐
Flexibility and prompt response.
A sense of professional ethics.

Objectives

To earn and maintain CAMEL rating strong.
To establish relationship banking and service quality through development of Strategic Marketing Plan.
To remain one of the best banks in Bangladesh in terms of profitability and asset quality.
To introduce fully automated systems through integration of Information Technology.
To ensure an adequate rate of return on investment.
To keep risk position at an acceptable range (including any off balance sheet risks)
To maintain adequate liquidity to meet maturity obligations and commitments.
To maintain a healthy growth of business with desired image.
To maintain adequate control systems and transparency in procedures.
To develop and retain a quality work force through an effective Human Resources Management System.
To ensure optimum utilization of all available resources.
To pursue an effective system of Management by ensuring compliance to ethical norms, transparency and accountability at all levels.

Strategies

To manage and operate the bank in the most efficient manner to enhance financial performance and to control cost of fund.
To strive for customer satisfaction through quality control and delivery of timely services.
To identify customers credits and other banking needs and monitor their perception towards our performance in meeting those requirements.
To revive and update policies, procedures and practices to enhance the ability to extend better services to customers.
To train and develop all employees and provide them adequate resources so that customer’s needs can be responsibly addressed.
To promote organizational effectiveness by openly communicating company plans, policies, practices and procedures to all employees in a timely fashion.
To cultivate a working environment that fosters positive motivation for improved performance.
To diversify portfolio both in the retail and wholesale market.
To increase direct contact with customers in order to cultivate a closer relationship between the bank and its customers.

Schemes offered by Jamuna Bank Limited

Â Monthly Benefit Scheme
Â Monthly Saving Scheme
Â Education Saving Scheme
Marriage Deposit Scheme
Â Double Growth Deposit Scheme
Â Triple Growth Saving Scheme
Â Lakhpoti Deposit Scheme
Â kotipati Deposit Scheme
Â Millionaire Deposit Scheme

Monthly Savings Scheme (MSS)

Savings is the best friend in bad days. Small savings can build up a prosperous future. Savings can meet up any emergences. JBL has introduced Monthly Savings Scheme (MSS) that allows saving on a monthly basis and getting a handsome return upon maturity. If anyone wants to build up a significant savings to carry out you’re cherished Dream, JBL MSS is the right solution.

Monthly Benefit Scheme (MBS)

Jamuna Bank Limited has introduced Monthly Benefit Scheme (MBS) for the prudent persons having ready cash and desiring to have fixed income on monthly basis out of it without taking risk of loss and without enchasing the principal amount. This scheme offers highest return with zero risk. Everyone can plan your monthly expenditure with the certain monthly income under the scheme.

Double/Triple Growth Deposit Scheme

For people who have cash flow at this moment and want to get it doubled/tripled quickly JBL has introduced Double/Triple Growth Deposit Scheme that offers to make double/triple money within 6(six) years and 9.5 (nine and a half) years respectively resulting a high rate of interest.

Marriage Deposit Scheme

Marriage of children, especially daughter is a matter of great concern to the parents. Marriage of children involves expense of considerable amount. Prudent parents make effort for gradual building of fund as per their capacity to meet the matrimonial expense of their children specially daughters. Parents get relief and can have peace of mind if they can arrange the necessary fund for marriage of their children, no matter whether they survive or not till the marriage occasion.

It can be a great help to the parents if there is any scope of deposit of a modest mount as per their financial capacity, which groves very fast at high rate of interest yielding a sizeable amount on maturity.

With this end in view JBL has introduced Marriage Deposit Scheme, which offers you an opportunity to build ‐ up your cherished ‐ fund by monthly deposit of serial, amount at your affordable capacity.

Education Savings Scheme

Education is a basic need of every citizen. Every parent wants to impart proper education to their children. Education is the pre‐requisite for socio‐economic development of the country. As yet, there is no arrangement of free education to the citizens from the government level. As such, there should be pre‐arrangement of fund to ensure higher educations the children.

Otherwise higher education may be hindered due to change of economic condition, income of the parents at the future time when higher education shall be required. Today’s higher education is becoming expired day by day. Parents can get relief and can have peace of mind if they can arrange the necessary fund for higher education of their children. As such, JBI, has introduced ‘Education Savings Scheme’ which offers you an opportunity to build up your cherished fund’ by monthly deposit of small amount it at your affordable capacity or initial lump sum deposit to yield handsome amount on a future date to meet the educational expenses. Under this Scheme you have the different attractive options to avail the future benefit i.e. withdrawal of the total amount accumulated in lump sum or withdrawing monthly benefit to meet educational expense keeping die principal amount intact or to withdraw both principal and accumulated profit monthly for a certain period.

Lakhpati Deposit Scheme

To become a lakhpati is a dream to most of the people of Bangladesh especially to the lower and lower middle class income group. They experience their expectations and wants are enormous in nature in our small span of life. To meet our deposit and wants we need right plan. Keeping the above in mind JBL has introduced “Lakhopati Scheme” which has flexibility report of maturity and monthly installment as per affordable capacity.

Products of JBL

Deposits

Types of Deposit Accounts-

Current Deposits
Savings Bank Deposits
Fixed Deposits (Term Deposit)
Short Term Deposits
Monthly Term Deposits
Any other deposits as may be approved/ advised by Head Office.

Procedures of Accounting Opening

Opening account with a bank is the way of creating a banker customer relationship. In other words, it is a contract between banker and customer. With this contract, bankers enter into certain obligations and responsibilities.

Proper introduction serves as a precaution against fraud and forgeries and safeguard against inadvertent overdraft to bank. Obtaining proper introduction may absolve the banker from the charges of negligence for conversion. So, while opening a new account, emphasis would be given without exception to introductory reference and inquiry. The following instruction to be followed while opening account: ‐

Introduction of Account to be obtained from a respectable client acceptable to bank.
The introduction shall be obtained in writing in the respective column of Account opening form.
For opening savings bank account of individual either singly or jointly, passports and identity cards may be accepted for introduction, but subsequently proper introduction may be obtained.
Introduction of Current Account by members of the staff may be allowed but shall be discouraged as far as possible.
Current Account shall preferably be introduced by another Current Account holder acceptable to bank.
Introduction of Account holder of other branch may be accepted with caution. In that case the introducer’s signature must be verified by authorized officer of that branch and authenticated by a forwarding letter.
Photographs of account holder must be attested by the introducer.
Letter of thanks be issued to introducer in Bank’s standard specimen.

Current Deposit Account

A Current Deposit Account may be opened by individual, firm, company and club, association, body corporate etc.
Funds in the Current Deposit Account is payable on demand.
No interest is payable on balances of Current Deposit Accounts.
Current Deposit Account may be opened with a minimum initial balance of Tk.5,000/‐
Minimum balance to be maintained in the account is Tk.1, 000/‐
Customer willing to open Current Deposit Account shall fill up the Account Opening Form (AOF) applicable to him/ her and Specimen Signature Card (SS Card). The customer will sign in the space provided under “Yours faithfully” and on the specimen signature cards. 9 In case of proprietorship and partnership firms the relevant account opening form is to be filled in and signed by the proprietor/ partner in their individual capacity in the space provided under “Yours faithfully” and on the specimen signature card in their official capacity.
In all other cases including companies etc. the persons opening the account shall fill in the relevant Account Opening Form and sign the Form in the space provided under “Yours faithfully” and in the specimen Signature Card in their official capacity.
Introduction of acceptable clients to be obtained as per guidelines.
The Manager’s approval for opening account shall be obtained by the concerned staff member.
Signatures of the account holder shall be admitted by affixing the stamp “Signature admitted” and signing by the authorized officer. The introducer’s signature shall be verified by affixing the stamp “Signature verified” near the signature by authorized officer.
Blank space of the Specimen Signature Card should be closed by drawing parallel lines.
The particulars of the Account Opening Form shall be entered in the Account Opened and Closed Register as per sequence provided by the computer system.
The customer shall be provided with Deposit Slip in corporating the Account Number and be advised to make the initial deposit in the account. The amount of initial deposit shall be entered in the Account Opening Form.
Cheque Book shall be issued on request on completion of all formalities including initial deposit. Cheque series to be entered in the Account Opening Form at the bottom right and authenticated by authorized officer.
After posting of all particulars of the account including cheque series, one authorized officer shall check/ verify the same in the computer screen and record it in the form with signature.
Manager/ Authorized Officer shall apply sufficient intelligence and common sense to ascertain genuineness of the account holder. No account shall be opened without approval of the Manager.
Clear instruction regarding operation of the account shall be noted on the Account Opening Form and Specimen Signature Card especially in respect of death of inability of the account holders, or the person operating the account. The account holder shall confirm the instructions under specimen signature.
An indemnity shall be obtained from the customer if he/ she signs in language other than English/ Bengali.
Illiterate persons shall be discouraged to open Current Account. If opened withdrawal shall be allowed on personal appearance of the account holder.
The account opening form shall be sent to the respective computer terminal for posting and S.S. Card shall be retained serially in the S.S. Card Box under custody of Cheque Passing Officer.

One of the photographs of the Account Holder is to be pasted with AOF and another one with S.S. Card. AOF to be retained in serial order in Pasting File. A letter of thanks to be sent to the account holder as well as to the introducer.All new accounts opened during the day shall be personally checked by the Manager at the close of business of each day.

Checking officer shall particularly see the introduction, initial deposit in cash or cheque, nature of business of the account holder, Trade License, Partnership Deed/ Memorandum of Articles of Association, Resolution etc.
Similar Accounts should be noted in the AOF and care should be taken while making posting of transactions in such accounts.
The Computer Program used by bank shall provide reference of clients. Branch Manager must ensure that their computer system provides reference of client.
Classified Deposit Ownership Program to be maintained in the Computer System for facilitating periodical returns to Bangladesh Bank.
Bank shall provide monthly statement of account to clients as per computer system of the branch.
If minimum balance of the account falls below Tk.2,000/‐once during the half‐year, incidental charge will be recovered as per Head Office Circular.
Bank at its discretion may close any account with prior notice to the account holder.
In case of closure of account by the account holder, branch shall recover closing charges as per schedule of charges.

Savings Bank Deposit Account

Savings Bank Account may be opened in the name of adult individual who are mentally sound and also jointly in the names of two or more persons payable to either or both or all of them or to the survivor or survivors.
Savings Bank Account may be opened in the name of a minor also.
Saving Bank Account may be opened in the names of clubs, societies, association and similar institutions and even by government and semi‐government offices.
Account shall be opened with at‐least a minimum initial deposit of Tk.1,000/‐.
Interest at the rates fixed by Head Office from time to time is applied half‐yearly on the balances held on daily product basis.
Not more than one account is allowed to be opened in the same name. But this will not be applicable to parents willing to open more than one account in his/ her name in respect of each minor child.
Savings Bank Account shall not be allowed to be overdrawn under any circumstances.
Account opening formalities like Current Account should be followed.
Savings Bank Account should not be allowed to be operated like Current Account
Not more than 25% of the balance can be withdrawn without 7 days notice. Withdrawals in the account shall be allowed twice in a week.
No interest shall be paid to such accounts in the month for violation of the above rules.
Bank shall provide monthly‐computerized statement of accounts to account holders instead of passbook.
Bank may at its discretion close any account with prior notice for repeated return of cheques due to insufficient balance.
Bank may recover charges up to a maximum of Tk.100/‐per instances of cheque return.

Short Term Deposit Account

Deposits held in this account are payable on short notice. Normally corporate bodies, bank and financial organizations invest their funds temporarily. Now‐a‐days, private individuals having sound financial means also open this type of deposit accounts. The following rules shall apply‐

Deposits held in STD Account are payable in 7 (Seven) days notice.
Cheque books may be issued to account holders for withdrawal of funds.
Repeated withdrawal without notice shall be discouraged.
Interest is payable on balance held on daily product basis as per computer program used by bank.
For opening STD Account, AOF used for Current Deposit Account shall be used.
Other formalities are similar to Current Deposit Accounts.
Minimum balance requirement for accruing interest is Tk.100,000 (Taka one lac) only.

Fixed Deposit Account

Fixed Deposit is neither transferable nor negotiable.
Fixed Deposit Account may be opened by individuals, firms, companies, corporate body etc.
Fixed Deposit Account shall be opened for a fixed period ranging from 3 months to 36 months or above as determined by Head Office from time to time.
Rate of interest payable to Fixed Deposit Accounts shall be approved/ advised by Head Office from time to time.
Interest on deposits shall normally be payable on maturity along with principal.
Customers may however, have the option of withdrawing interest accrued after every six months provided that the account is for more than 24 months period.
Interest ceases to accrue on overdue Fixed Deposit Account. Branch may, however, allow interest to exceptionally valued clients on deserving cases with concurrence of Head Office.
FDR may be encased before maturity on written request of the depositor. For payment of interest, branch shall follow Head Office instruction in this regard from time to time.
In case of FDR in joint names, written consent of all holders shall be obtained before premature encashment, irrespective of instruction provided for operation of the account.
Duplicate FDR may be issued in case of loss of FDR reported by the holder. An indemnity bond executed by the depositor(s) shall be obtained on Bank’s standard form. A remark “DUPLICATE ISSUED IN LIEU OF ORIGINAL REPORTED LOST” is to be typed on top of the duplicate FDR. The original number should be used and comments to this effect be recorded in AOF, S.S. Card and FD Issue Register.
Extra care shall be taken in case duplicate FDR is proposed for lien to any bank.
Each FDR of the same depositor will be treated as separate contract.
Account Opening Form for Fixed Deposit Account contains relevant columns for mentioning all terms including rate and term of deposit and operational instruction. The bottom part of the form shall be used as credit voucher for the deposit. Specimen Signature Card duly signed by the depositor to be obtained with clear instruction for operation of the account.
Nominee form may be obtained if the depositor desires to nominate anybody to receive the proceeds of his account in case of his death. Nominee’s Signature and one copy of photograph duly attested by the depositor to be obtained.
The signature of the depositor is to be admitted by authorized officer both in AOF and S.S. Card.
Particulars of the account shall be entered in the FD Account Opening Register and a control number be allotted in computer sequence order with oblique against the printed number of FDR. The complete number shall be quoted/ mentioned in all references.
On completion of all formalities, including deposit of fund, FDR shall be issued and signed by two authorized officers. The FDR shall be delivered to depositor against acknowledgement on the reverse of the counter foil.
The AOF will be retained in file and the S.S. Card shall be kept in S.S. Card Box under custody of the concerned authorized officer.
The particulars of the account shall be posted in the computer system on completion of all formalities including receipt of deposit. One authorized officer shall check/ verify the particulars in the computer screen and record his comments on the AOF to this effect with signature.
Renewal of Fixed Deposit Account shall be allowed on written request of the depositor, if no intimation is received, the account shall be deemed to have renewed under the existing terms and conditions automatically.
FDR can be accepted as security against credit facility.
Offer of special interest rate on deposits is subject to Head Office approval.

Accounting System

SWOT Analysis

STRENGTH

Stable Source of Funds
Largest Portfolio Among PCBs
Strong Liquidity Position
Low Cost Fund
Satisfactory Profitability

WEAKNESS

Marginal Capital Adequacy
Lack of Strong Initiative to Explore Investment Opportunity Through Research And Marketing
IT & E‐Banking Status Dose Not Match With Other Banks

OPPORTUNITY

Scope of Whole Sale Banking with NBFIs
Increasing Awareness of Banking System
Credit Card Business

THREATS

Increased Competition In The Market For Quality Assets
Supply Gap Of Foreign Currency
Overall Liquidity Crisis In Money Market

Recommendation

Though Jamuna Bank Limited tries to give the best customer support, they have some lake and linkage compare to other bank of the same generation. The recommendations for this report are‐

The authority should recruit more employees to serve the customers. The can recruit experienced employee as well as fresh graduate.
The bank should introduce more products based on the market demand.
The bank should reduce their minimum balance to attract more customers.
The salary of the worker need to be rise, as a result experienced people from other bank will be attract to join Jamuna Bank Limited.
Jamuna Bank Limited should offer international credit card, because in modern world the use of increasing paper currencies is decreasing.
Beside social work the bank have to be more serious to get better position in CAMEL retting.
The bank can open more branches to reach to more customers.
The bank can open branches or foreign booth because many people send money from abroad every year to Bangladesh.
The bank should finance to the consumer goods, because many people in the country wants to buy consumer goods from bank loan.
The marketing department of the bank should more efficient to reach at the hart of the customer.
For the success of any organization, employee satisfaction is one of he most important factor and JBL authority have to look about it.
The bank should be more profit concern as well as took part to the economics development of the country.
The departments of the bank should more efficient to make profit by satisfying customers.
The bank should use printed instruments like cheque, pay orders etc.
Being a clear transparent the bank can provide the best support to the customer as earn profit.

Jamuna Bank Limited is bank of new generation. Though my report is on general banking, I tried hard to cover all about the customer and their behavior with the bank.

For a banking operation deposit is one of the most important factor as well as remittance, clearing, cash are also part of general banking and customers are directly related with these department. By making proper interaction among the departments the bank can give the best support to the account holders. On the other hand, if the customers are satisfied they will bring more new customers and this process will be continuing. JBL is the best bank, which provides a large fund to develop the society, and the bank has to continue this process. Finally “Jamuna Bank Limited” – ‘Your Partner for Growth’ must be a true partner of the customers.

Conclusion

As an organization the Jamuna Bank Limited has earned the reputation of top banking operation in Bangladesh. The organization is much more structured compared to any other bank operating local or foreign in Bangladesh. It is relentless in pursuit of business innovation and improvement. It has a reputation as a partner of consumer growth.

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

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