Achievement of high economic growth is the basic principles of present economic policy. In achieving the objectives, the banking sector plays an important role. The banking sectors channel resources through deposit mobilization and providing credit for different business venture. The successful running of a bank business depends upon how effectively the credit management recovered the funds.
Uttara Bank Limited is always ready to maintain the highest the quality services by upgrading Banking technology prudence in manage and applying high standard of business ethics through its established commitment and heritage. Objectives of a private institution like UBL are to maximize profit through optimum utilization of resources by providing best customer’s service.
1.2.Origin of the report:
In today’s world only academic education does not make a student perfect to become competitive with the out side world. Internship is highly needed to gain idea, knowledge and experience.
Stamford University is one of the International University in Bangladesh wish has offered MBA program to produce graduates. Internship helps the students to learn how theoretical knowledge turn into practical knowledge. This also gives knowledge about real business world.
Uttara bank Moghbazar Branch is a place where I learn many things about business dealings. This organization has created a positive image to the customer’s mind by providing better service. This bank has introduced some modern banking technique to create market demand. Uttara Bank Moghbazar Branch provided me a good working environment. As an intern student I have got the opportunity to work with this organization for three months and acquire idea about real business world.
1.3. Topic of the report:
To write a report it is necessary to select a topic. A well-defined tropic reflects what is going to be discussed throughout the report. In this report my
Tropic is ‘Banking over all system’. Here I will discuss different functions of Banking and how it contributes to the profit of the bank.
1.4 .Background of the Report:
Uttara Bank is one of the established banks pf Bangladesh. It has 203 branches throughout the country. Foreign and local Remittance is the heart of moghbazar branch. It earns most of the profit for the Branch. It also provides various services to the clients which is also most important.
1.5. Objective of the Report:
General objective of the report:
The general objective of this report is to complete the internship. As per requirement of MBA program of Stamford University Bangladesh, one student needs to work in a business organization for three months to acquire practical knowledge about real Business operation.
1.6. Specific Objective of the report:
Scope of the Report:
As I was working in Uttara Bank, Moghbazar Branch, I got the opportunity to learn different part of banking system. The supervisor divided the whole banking system in three parts; as a result I got the opportunity to work in all the three divisions (General Banking Division,
1.7. Limitation of the Report:
Although I have obtained wholehearted co-operation from employee of UBL, Moghbazar Branch, they could not manage enough time to deal with my report. On the other hand, some newly transferred employees are posted to different sector so, they were not able to teach me clearly. On the way of my study, I have faced the following problems that may be terms as the limitations/shortcomings of the study.
Budgeted times for the Study:
The first obstruct is time itself. Due to time limit, the scope and dimension of the study has been curtailed. UML is a big organization. It is very tough to deal with this Bank within this short time.
It was very difficult to collect data from such a big organization. My internship was at Moghbazar branch. But for better interpretation I had to collect some information from the Head Office. But because of some divisional and confidential problem, I could not get enough information
Lack of Records: Sufficient book, publications, facts and figures are not available. These constraints narrowed the scope of accurate analysis. If these limitations were not been there, the report would have been more useful and attractive.
1.8. Sources of Information:
Data that were published before for some other reason can be collected using internal and external sources.
Internal Secondary data:
To furnish the report properly some papers has been collected form the officials of Uttara Bank Limited. Information from annual reports, register, newspapers and others documents have been used. Besides other information are collected from the information of the employee of the Bank and the depths interview of the branch manager MD. MAHAMUBUR RAHMAN.
External Secondary Data:
For better interpretation some data has been collected from Bangladesh Bank. Internal Browsing is also one source of external Secondary data.
1.9. Time Period Of The study:
On the first day the supervisor send me to general banking clearing section where I work for 40 days. I have worked the credit division for 30 days. And at last I work Foreign Exchange Remittance for 20 days. As a result I could learn the whole Banking System as much possible.
Time period of the internship
UBL, Moghbazar Branch
General Banking Division: 40 Days
Credit Division : 30 Days
Foreign Exchange Division: 20 Days
AN OVERVIEW OF BANKING SYSTEM IN BANGLADESH
The Prosperity of a country depends upon its economic activities like any others sphere of modern socio-economic activities; banking is a powerful medium of bringing about socio-economic changes of a developing country.
Agriculture, commerce and industry provide the bulk of a country’s wealth. Without adequate banking facility these three cannot flourish. For a rapid economic growth a fully developed banking system is highly essential. A suitably develop Banking system can provide the necessary boost for the economic uplift of the country. The whole economy of a country is linked up its banking system.
Banks in Bangladesh can be classified into following categories.
2.2.Origin of Banking:
According to some economic the word (Bank) has been derived from the German word (BANC), which means a joint stock firm. While others say that it has been derived from Italian word (BANCO), which means a heap or mound.
The business of Banking is an old as the civilization itself. As early as 2000 B.C the Babylonians has developed a system of banks. They used their temples for lending at higher rates of interest against gold and silver, which has been left with them for safe custody. Around the same time the Greek temples were used as depositories for people surplus funds and these are centers of money lending transaction. The priests of the temple acted as financial agents. It was lessons of finance were learnt a fresh form the beginning. However during this period banking was mainly in the hand of the Jews and Lombardy who lend money to all. With the passage of time and with development of trade and commerce around the 13th century the Christians also started money- lending business. They started giving keen competition to the Jews and it became necessary to change and to initiate new strategy to secure competitive advantages and to protect and to fortify exiting position in the banking industry.
Around the time of Adam Smith (1776) there was a massive growth in the banking industry. Within the new system of ownership ands investment, the State’s intervention in economic affairs was reduced and barriers to competition were removed. In the 1970s, a number of smaller crashes tried to the policies put in place following the depression, resulted in deregulation and privatization of government- owned enterprises in the 1980s, indicating that governments of industrial countries around the world found private-sector solutions to problems of economic growth and development preferable to state-operated, semi-socialist programs. This spurred a trend that was already prevalent in the business sector, large companies becoming global and dealing with customers, supplies, manufacturing, and information centers all over the world.
Global banking and capital market services proliferated during the 1980s, and 1990s,as a result of a great increase in demand from companies, governments, and financial institutions, but also because financial market conditions were buoyant and, on the whole, bullish. Interest rates in the United States declined from about 15% for two-year U.S. Treasury notes to about 5 % during the 20-year period, and financial assets grew then at a rate approximately twice the rate of the world economy. Such growth rate would have been lower, in the last twenty years, were it not for the profound effects of the internationalization of financial markets especially U.S. foreign investments, particularly from Japan, who not only provided the funds to corporations in the U.S. but also helped finance the federal government; thus, transforming the U.S. stock market by far into the largest in the world.
In recent years, the process of financial innovation has advanced enormously increasing the importance and profitability of nonblank finance. Such profitability priory restricted to the nonbanking industry, has prompted the office of the Comptroller of the Currency (OCC) to encourage banks to explore others financial instruments, diversifying banks, business as well as improving banking economic health. Hence, as the distant financial instruments are being explored and adopted by the banking and nonbanking industries, the distinction between different financial institutions is gradually vanishing.
2.3. Historical Background of Bangladesh
Major Events in Banking History
• Florentine banking – The Medicine and Pittis among others
• Knight Templar – Earliest Euro Wide / Mideast banking 1100-1300.
• Banknotes – Introduction of paper money.
• 1602- First joint– stock company, the Dutch East Indian Company foundation.
• 1720 – The South Sea Bubble and John Law’s Mississippi Scheme, which caused a European financial crisis and forced many bankers out of business.
• 1781 – The Bank of North American was found by the Continental Congress.
• 1800 – Rothschild family found Euro wide banking.
• 1803 – The Louisiana Purchase was the largest land in history
• .1929 – Stock market crash
• 1989 – Jung bond scandal and charges against Michael resulted in new legislation for investment banks.
• 2001 – Enron bankruptcy, causing new legislation for annual reporting.
Oldest Private Banks
• Monte dei Paschi di Siena 1472 – present.
• Barclays which was founded by John Freame and Thomas Gould in 1690 The bank was renamed to Barclays by Freame’s son –in –low , James Barclay, in 1736.
• Hope & Co, founded in 1762.
• Barings Bank founded in 1806.
• Rothschild family 1700- present.
2.4. Banking Sector in Bangladesh
Bangladesh has mixed banking system comprising nationalized, privet and foreign commercial banks. Bangladesh Bank is the central bank of the country and is in charge of monetary policies of the Government and controls all commercials banks.
Number and Types of Banks
The number of banks in all now stands at 49 in Bangladesh. Out of the 49 banks
, four are Nationalized Commercial Bank (NCBs), 28 local private commercial banks, 12 foreign banks and the rest five are Development Financial Institution (DFIs). Sonali Bank is the largest among the NCBs while Pubali is leading in the private ones.
Bangladesh Bank is now carrying out a reform program to ensure quality services by the banks. Bangladesh Bank (BB) has been working as the central bank since the country’s independence. Its prime jobs include issuing of currency, maintaining foreign exchange reserve and providing transaction facilities of all public monetary matters; BB is also Bangladesh Bank (BB) has been working as the central bank since the country’s independence. Its prime jobs include issuing of currency, maintaining foreign exchange reserve and providing transaction facilities of all public monetary matters. BB is also responsible for planning the government’s monetary policy and implementing it thereby.
The BB has a governing body comprising of nine members with the Governor as its chief. Apart from the head office in Dhaka, it has nine more branches, of which two in Dhaka and one each in Chittagong, Rajsjahi, Khulna, Bogura, Sylhet, Rangpur,and Barisal.
Service (Accounts, FDR, PDS, DEPOSIT Scheme)
Generally this sort of account opens for business purpose. Customers can withdraw money once or more against their deposit. No interest can be paid to the customers in this account. If the amount of deposit is below taka 1000 on an average the bank has authority to cut taka 50 from each account as incidental charge after every six months. Against this account loan facility can be ensured. Usually one can open this account with taka 500. One can open this sort of account through cash or check/bill. All the banks follow almost the same rules for opening current account.
Saving Bank Account
Usually customer opens this sort of account at a low interest for only security. This is also an initiative to create people’s savings tendency. Generally, this account is to be opened at taka 100. Interest is to be paid in July and December after every six months. If money is Withdraw twice a week or more than taka 10,000 is withdrawn (if 25% more compared to total deposit) then interest is not paid. This account guarantees loan. Almost all the banks follow the same rules in the field of saving account, except foreign banks for varying deposit. On an average, all the banks give around six percent interest.
Special Bank Account
Some Banks render special services to the customer attracting other banks.
Customers need an Internet access service. As an Internet Banking customer, he will be given a specific user ID and a confident password the customer can then view his account balances online. It is the industry-standard method used to protect communications over the Internet.
To ensure that customer’s personal data cannot be accessed by anyone but them, all reporting information has been secured using Version and Secure Sockets Layer (SSL).
Home Banking frees customer of visiting branches and most transactions will be automated to enable them to check their account activities transfer fund and to open L/C sitting in their own desk with the help of a PC and a telephone.
Electronic Banking Services for Windows (EBSW)
Electronic Banking Service for Windows (EBSW) provides a full range of reporting capabilities, and a comprehensive rang of transaction initiation options.
The customers will be able to process all payments as well as initiate L/C and amendments, through EBSW. They will be able to view the balance of all accounts, whether with many banks in Bangladesh using SWIFT. Additionally, transaction may be approved by remote authorization even if the approver is out of station.
Automated Teller Machine (ATM)
Automated Teller Machine (ATM), a new concept in modern banking, has already been introduced to facilitate subscribers 24 hour cash access through a plastic card. The network of ATM installations will be adequately extended to enable customers to non-branch banking beyond banking.
Tele Banking allows customers to get access into their respective banking information 24 hours a day. Subscribers can update themselves by making a phone call. They can transfer any amount of deposit to others accounts irrespective of location either form home or office.
Swift is a bank owned non-profit co-operative based in Belgium servicing the financial community worldwide. It ensures secure messaging having a global reach of 6,495 Banks and Financial Institution in 178 countries, 24 hours a day. SWIFT global network carries an average 4 million message daily and estimated average value of payment messages is USD 2 trillion.
Swift is a highly secured messaging network enables Banks to send and receive Fund Transfer, L/C related and other free format messages to and from any banks active in the network.
Having SWIFT facility, Banks will be able to serve its customers more profitably by providing L/C, Payment and other messages efficiently and with utmost security. Especially it will be of great help for our clients dealing with Imports, Exports and Remittances etc.
Monetary & Credit Policy
The monetary and credit policy for the financial year that ended in June, 2000 was formulated with the objective of full utilization of domestic resources and rapid economic growth through priorities for agriculture, Industry, export, and expansion and strengthening of the private sector, at the same time keeping inflation within tolerable limits. A modern expansionary monetary and credit policy was adopted in order to make good the losses to agriculture, industry, and infrastructure by the devastating floods of 1998. After the fold the economy remained sluggish in the first quarter of 1999-2000 and the privet sector demand for credit shrank. In view of this, the Annual Development Program (ADP) was expanded and development activities in the private sector were geared up. As a result, the public sector absorbed credit at an accelerated rate. Through credit to the private sector picked up towards the end of the year, the overall annual growth was smaller then programmed, although gross domestic credit expanded a little faster than projected. Money supply increased by 15.3 % in 1999-2000 compared to the expansion of 8.6% in the preceding year.
Narrow Money increased by TK. 2,631.90 crores or 15.3 % to TK. 19881.30 crores in 1999-2000. Of the components of Narrow Money, currency outside banks went up by TK. 1489.40 crores or 17.2 % to TK> 10176.60 crores, and demand deposit went up by TK. 1142.50 crores or 13.3 % to TK. 9705.30 crores.
Broad Money increased by Tk.11735.70 crores or 18.6% to Tk.74,762.40 crores in 1999-2000 compared to the increase of 12 % in the preceding year. Of the components of Broad Money, Narrow Money increased by 15.3 % and time deposits rose by 19.9 % compared to the increased of 8.6 % in Narrow Money and 14.5 % in time deposits in the preceding year. The share of currency outside banks, demand deposits and time deposits in Broad Money stood at 13.6%, 13.0%, and 73.4% respectively on 30th June, 2000 compared to 13.8%, 13.6% and 72.6% respectively on 30th June, 1999. Expansion of credit to the privet sector, government sector (net), public sector, and other assets (net), alone with a surplus in net foreign assets contribution to the expansion of Broad Money.
Reserve Money increased by TK.2321.80 crores or 15.7% to TK.1706.50 crores in 1999-2000 compared to the increase of 8.3% during the preceding year. Of the components of Reserve Money, Currency outside banks increased by TK.1489.40 crores or 17.1% compared to the increase of TK.533.30 crores or 6.5 % during the preceding year.Scheduled banks balances with the Bangladesh Banks increased by TK.770.90 crores or 15.3% in 1999-2000 compared to the increase of TK. 488.20 crores or 10.8% in the preceding year. Their cash in tills increased by TK.61.50 crores or 6.0% as against the increased of TK.103.60 crores or 11.2% in the preceding year. The increased in Bangladesh Bank’s credit to the government (net) by TJ.1,738.10 crores and net surplus in the foreign sector by TK.1,262.40 crores played the main role in exerting expansionary influence on the Reserve Money. However the decline of TK.333.60 crores and TK.44.90 crores in the borrowings by the scheduled banks and others financial institutions respectively along with the fall of TK.300.20 crores in other assets (net) party offset the expansionary impact of those sectors.
Total domestic credit increasede by TK.8581.20 crores or 13.6% to TK.71, 489.00 crores (including adjustment of bonds issued by the government) in 1999-2000 as compared to the increased of TK.7267.60 crores or 13.1% in the preceding year. Expansion of credit to the government, private and public sectors to the extent of TK.3524.30 crores(31.35) , TK.4906.10 crores (10.7%) , and TK.150.80 crores (2.5) respectively contributed to the expansion in total domestic credit in 1999-2000. Credit to the government and private sector had increased by 21.3% and 13.8% respectively, while credit to the public sector decline by 3.7 % in the preceding year.
The outstanding level of bank credit (excluding foreign bills and inter-bank items) increased by TK.5,123.30 crores or 10.3% to TK.54,646.10 crores in 1999-2000 as compared to the increase of 12.4% in the preceding year. Of the components of bank credit, advances increase by TK.4892.70 crores or 10% and the bills purchased and discounted went up by TK.230.60 crores or 11.3%.
Bank deposits (excluding inter-bank items) increased by TK.11044.70 crores or 18.6% to TK.70, 278.70 crores in 1999-2000 compared to the increase of 14.2% in the preceding year. Of this increase, time deposits went up by TK.9,103.80 crores or 19.9% to TK.54,881.10 crores , government deposits by TK.723.60 crores or 14.8% to TK.5,625.20 crores and demand deposits by TK.1,142.50 crpres or 13.3% to TK.9,705.30 crores .On the other hand, restricted deposits increased by TK.74.80 creres in 1999-2000.
Cash Reserve Requirements (CCR)
Statutory CRR with Bangladesh Bank was lowered for the scheduled banks to 4.0 % of their liabilities (demand plus time deposits) (excluding inter-bank deposits) from 5% with effect from 1st October, 1999.
The Bank Rate was lowered from 5.5% to 6 on 29th August, 2006 and remained unchanged through 30th June, 2008.
The Banking Industry in Bangladesh is one characterized by strict regulation and monitoring from the central governing body, The Bangladesh Bank the chief concern is that currently there are far too many banks for the market to sustain. As a result the market will only accommodate only those banks that can transpire as the most competitive and profitable ones in the future. Currently, the major financial institutions under the banking system include:
Of these, there are four nationalized commercial banks (NCB), 5 specialized banks, 11 foreign banks, 26 domestic private banks and 4 Islamic Banks currently operating in Bangladesh.
All local banks must maintain a 4% Cash Reserve Requirement (CRR), which is non-interest bearing and a 16% secondary Liquidity Requirement (SLR). With the liberalization of markets, competition among the banking products and financial services seems to be growing more intense each day. In addition, the banking products offered in Bangladesh are fairly homogeneous in nature due to the tight regulations imposed by the central bank. Competing through differentiation is increasingly difficult and other banks quickly duplicate any innovation banking service.
AN OVERVIEW OF UTTARA BANK LIMITED
3.1. History and Background
Banking system occupies an important place in a nation’s economy. A banking institution is indispensable in modern society. It plays a liberalization of economic policies in Bangladesh. Uttata Bank Limited emerged as a private bank in the year 1965 in a Dhaka. At that time its name was Eastern banking Corporation. It was Nationalized 1972. Then again it was denationalized in the year 1984. Now it has 207 branches through out the country.
3.2. Mission of UBL
Uttara Bank Limited aims to become one of the leading Banks in Bangladesh by prudence, flair and quality of operations in their banking sector. The bank has some mission to achieve the organizational goals. Some of them are as follows as:
Uttara Bank Limited provides high quality financial services to strengthen the well being and success of individual, industries and business communities.
Its aim to ensure their competitive advantages by upgrading banking technology and information system.
UBL intends to play more important role in economic development of Bangladesh and its financial relations with the rest of the world by interlining both modernistic and international operations.
The bank believes in strong capitalization.
It maintains high standard of corporate and business ethics.
Uttara Bank Limited extends highest quality of services, which attracts the customers to choose them first.
The Bank creates wealth for the shareholders.
The bank maintains congenial atmosphere for which people are proud and eager to world with Uttara Bank Limited.
The Bank intends to meet the needs of their clients and their profitability by creating corporate culture.
3.3.Objectives &Goals of UBL
The objectives of UBL is not only to earn profit but also to keep the social commitment and to ensure its co-operation to the person of all level, to the businessman, industrialist-specially who are engaged in establishing large scale industry by consortium and the agro-based export oriented medium and small scale industries by self inspiration.
UBL is always ready to maintain the quality of services by upgrading banking technology prudence in management and by applying high standard of business ethic through its established commitment and heritage.
UBL is committed to ensure its contribution to national economy by increasing its profitability through professional and disciplined growth strategy for its customer and by creating corporate culture in international banking arena.
3.4. Specific Objectives Of UBL
Uttara Bank limited has 31 specific objectives according to its memorandum. The most important objectives are-
To carry on the business of a bank with such branches or agencies and at such places in Bangladesh and abroad as may form time to time be determined by the directors
To carry as an agents for the business of banking in all its branches and departments.
To act as an agents for government or local authorities or for any other person or persons.
To carry on and transact every kind of guarantee and indemnity business.
To promote or finance any business undertaking or industry.
To take or acquire and hold shares, debentures or securities.
To advance money.
3.5. Management Of UBL
NURUL AMIN KHAN was the foundation Chairman of the Board of Director of UBL. The First Managing Director was A.N. Hamiddullah. He was the first governor of Bangladesh Bank. Azharul Islam is the Present Chairman of UBL. Present M.D. is Samsuddin Ahmed and Additional M.D. is MD. Abdus Sattar.
3.6. An Overview Of Moghbazar Branch
Moghbazar is one of the oldest Branch of Uttara Bank Limited. It has great contribution to UBL as well as to our country. This year it earns a profit of more than Foreign Remittance and local Remittance is the hearts of this branch.
Now it has 13 Employee. Head of them is Assistant General manager acting as branch in charge of the .This branch has one senior officer he is also in charge of credit division. This branch has 5 PO. One of them is in charge of the Foreign Exchange Remittance and other are working in the general banking division. . 3 of them are working in the cash one of them is cash in charge. And other 2 is PO working in the Advance division. And there are 2 grades –II officer they are also working in the general division.
STRUCTUREAL MANAGEMENT OF UBL:
Organization Chart of Uttara Bank Limited
Money: Money functions as a medium of exchange, a unit of account, a store of value and a standard for deferred payments. Monetary systems have evolved over time form barter economics through gold and silver coin to paper money, which dominates now both because of scarcity of precise metal and because it can accommodate a sophisticated societies need for a flexible money supply.
Loan: The largest and most profitable asset category is loans. House repairing, Mortgage and short business lone is given here. Commercial, Financial and agricultural loans are the single largest category of national’s loan, but real estate credit card, customer installment and lease financing loans are also important source of revenue.
Deposit: The largest classification of liabilities for a bank is its deposits.
Default Risk: The risk that the issuer of fixed income security may fail to pay interest and/or principal.
Commercial Loan: Businesses require working loans in order to sustain themselves.
Consumer Loans: Consumer loans are of particular importance to smaller bank some of which are consumer portfolios that are larger then their commercial portfolios. Individuals obtain these loans for a number of reasons including durable goods purchases, vacation, medical expenses and education.
PLC (Product Life Cycle):
The courses of a products, sells or profit over its life time. It involves five distinct stages: Products development, Introduction, Growth, Maturity, Decline.
The overall evaluation of consumer credit scheme’s (CCS) Strengths, Weaknesses, Opportunities, Threats are called SWOT analysis of the scheme.
4.2.Tools For Appraisal Credit
The C, of Goods and Bad Loan:
In addition to the formal credit appraisal, the credit officers try to judge the possible client based on some other criteria. These criteria are called the C’s of goods and bad loans. The C’s are described below.
-Character Make sure that the individual or company you are lending to have out standing integrity.
-Capacity Make sure that the individuals or company are lending to have the capability of repaying your loan.
-Condition Understanding the business and economic conditions can and will change after the loan is made.
-Capital Make sure individuals or company you are lending to have an appropriate level pf investment in the company.
-Collateral Make sure that there is a “second way out” of a credit but do not allow that to drive the credit decision.
-complacency Do not rely on past history to continue. Stay alert to what can go wrong in any loan.
-Carelessness Remember that documentation, follow-up and consistent monitoring is essential to high quality loan portfolios.
-Communication Share credit objectives and credit decision making both vertically and laterally with in the bank.
-Contingencies Make sure that you understand the risk; particularly the downside possibilities and that you structure and price the loan consistently with that understanding.
Competition Do not get swept away by what others are doing.
4.3. BANKING TERMS
UBL: Uttara bank Limited
CCS: Consumer Credit Scheme
TT: Telephone Transfer
DD: Demand Draft
MT: Mail Transfer
PO: Payment Order
LRA: Leading Risk Analysis
LTR: Loan against trust receipt
PAD: Payment against Documents
ILC: Inland Letter Of Credit
LIM: Loan against Imported Merchandise
D/L: Demand Loan
FBL: Foreign Bill Purchase
IBP: Inland Bill Purchase
FBPAR: Foreign Bill Purchases Awaiting Remittance
EFERQ: Exporter’s Foreign Exchange Retention Quota
FCAD: Foreign Currency Account for Deposit
ITT: Inward Telegraphic Draft
FDD: Foreign Demand Draft
TC: Traveler’s Cheque
STD: Short Teem Deposit
FD: Fixed Deposit
IBDA: Inter Branch Debit Advice
IBCA: Inter Branch Credit Advice.
Internship has provided me the opportunity to coordinate the theoretical
knowledge that I have gathered in Stamford University with the practical Field.
Although three months is not a very long period to learn the whole things they
Usually occurs in an organization, I tried my best to learn as much as I could.
The supervisor divided my job into three parts.
1) The general Banking department
2) The Credit division and
3) The Foreign Remittance.
At first I was pleased to the General Banking department. I worked there
50days. Then I moved to the advance department to work there for 40 days.
As my main concern was to collect information from all the department.
5.2. The General Banking Division:
At First I was placed to this Division. The officers gave all the briefings
about this Division.
LEARNING EXPERIENCE FROM GENERAL BANKING DIVISION:
The main business of this division is dealing with deposit. There are two
types of Deposit in this Branch.
These deposits are withdrawal of money without Notice. There are two
Types of demand deposit in this Branch.
Time deposit: A deposit which is payable at a fixed data or after a period of notice is a time deposit. I fond two types of Time deposit in the Branch.
-Fixed Deposit (FDR)
-Short term Deposit (STD)
Task I handled in this Division is:
-Issuing Cheque Book
-Demand Draft t (D.D)
-Telegraphic Transfer (T.T)
-Mail Transfer (M.T)
-Payment Order (P/O)
Cheque Book issue is very sensitive issue because most of the fraud occurs through this cheque book. To open an individual savings account one need to have an introducer having an account in this Bank. But to open a current account one need an introducer having Current account. And if it is Partnership Company, the customers need to submit the partnership deed. I also dealt with receiving documents/ letters. In clearing section, I learned about Endorsement. The Bank has to keep record of the collecting cheque & return cheque in the registered book and some other record keeping books and requires preparing particular schedule paper. In the transfer register he debit and Credit balance should be matched. Otherwise they need to recalculate the whole transaction again. The total amounts of every record have to exactly same. I had to work in the deposit section where I have gathered high knowledge about banking deposit. I become myself acquainted with different kinds of deposit of this Branch. This Branch mainly deals with CD, SD, and FDR I also learned about the local remittances system of the branch. I had to write voucher of pay order, DD& TT& PO to match the test number. If the test number didn’t match, then the authority cancelled that. There is one responsible officer who deals with the daily voucher. He needs to check all the voucher used pervious day. I got the opportunity to become acquainted with these facts. The cash in charge and the man who posts the transaction in the computer need to match end of the day.
5.3. Learning Experience From Advance Division:
This is one of the busy departments I have found in Moghbazar Branch of my internship training. I have learned different functions of this division. The main Business of a bank is to provide advances to the customers. But if the management does not understand the customer’s intention the bank might loose huge amount money from the project. This department exercises the lending function; therefore, distribute its funds among various assets in a manner as to drive sufficient income. The different tasks I found in this division are as follow:
Except the proposal of different loan from the customer.
Verifying the customer.
Investigate the customer’s work place.
Landing Risk Analysis (LRA) done by the head office but lending depends on it.
Issuing loan for the customer.
Collecting Charge documents from the customers.
Issuing short loan, business loan, house repairing loan.
Monitoring the recovery.
Sending letters to the defaulter.
Contact with defaulter etc.
The officers of this department told me about all the function and how they deal with these factors. Secured overdraft is one the important task of this division. The bank gets 14% interest from this loan. A parson can take loan from his or her fixed deposit. Consumer Credit scheme is another important task of this division. When a loan is issued to the customers the bank needs to take charge documents from the party. If the party becomes defaulter and the bank requires submitting sue against that party charge document help the bank a lot.
This division needs to monitor the recovery rate of each month. The responsible officer sends the report about the condition of the loan each and every month. So the officer collect information from the each department whether all the customers repaid the loan not. After getting the information he needs to send letters to the defaulters for repaying the loan immediately.
Otherwise he needs to contact personally with the customers physically or through telephone. In lending, the most important step is the selection of the borrower. Due to the asymmetric information and moral hazard, banks have to suffer a lot due to the classified loans and advances, which weakens the financial soundness of the bank. If the selection of reliability, resourceful and responsible; the bank can easily get the retune from the lending. For this the division needs to prepare lending risk Analysis for the persons who want to take bigger loans. And send it to the head office so that they can verify all the things and issue it for the customers.
General Banking is designed to provide financial service to the general people in saving their money; smoothing transaction for businessman and ensure security of the precious wealth of the client. Under general banking the UBL provides various kinds of accounts. Different aspects of general banking are briefly discussed below:
6.2. Account Opening:
UBL Moghbazar Branch main have two types of account for the customers. They are-
A saving account can be open in own or joint name. In case of joint account, the account can be maintained by the both or any one of them. Not more than one account can be open in same name. Saving account can be transfer from one branch to another. To open a saving account in the bank is required. This account can be used for collection of fund from DD, MT, TT, PO, dividend warrant etc. Interest is given in these accounts. Here minimum deposit is TK.1000. There is some restriction in withdrawal of fund. Account closing charge is TK.100.
Current account can be divided into three-
Current account for person can be open by one individual or jointly by more than one individual. Here minimum deposit is 2000. There is no restriction regarding withdrawal of fund. A saving account holder cannot be the introducer for opening of Current account. Citizenship certificate is also needed here. Here account closing charge is TK.100.
For Limited Company:
To open a current account photocopy or registration certificate should submit. List of Board of Directors also be given to the bank. Here the name of person or persons will be given who will maintain the account.
For Private Company:
Here the bank carefully justifies the introducer. Here trade License, Registered partnership deed (in case of partnership business) is required to open an account.
Issuing Cheque Book:
Cheque book is used to withdraw fund from an account. Client is given a Cheque book while opening an account. After finishing a cheque book the client have to fill up the requisition slip to drown a new cheque book. A saving account cheque book contains 10 leaves and a current account cheque books contain either10 or 25 or 50 or 100 leaves. Depending on the use pattern of the client the authorized officers provide cheque books.
People need to transfer money from one place to another. Physical fund transfer is risky and time consuming. Banks transfer fund on behalf of customers within short time in a less risky way in exchange of some commission which is known as remittance earning. There are some instruments to transfer fund. The instruments are-
Pay Order is one kind of unconditional promissory note or instrument that is issued by the bank to the customer. The difference between cheque and pay order is the mode of encashment.
Demand Drafts are made for the transfer of money from one place to anther in the form of cheque through a particular Bank. The bank issues DD for their outer district branches.
When a certain amount of money is asked by the client to transfer from one branch to another within a day then bank use phone to transfer fund from one account to another. For TT, there is a particular form. When the form is filled up properly and deposits the amount by the applicant, the authorized officer issued a cost memo to the applicant for their confirmation.
Mail transfer is also used for the same purpose. It is generally used where there is no TT arrangement.
In the clearing section the work is to clear the cheques, DD’s and PO’s through Bangladesh Bank that are submitted for cash collection. Everyday clearinghouse takes place in Bangladesh Bank, once in the morning called morning house another in the evening called return house. In the house all the Banks representative sit together and exchange their money to their particular accounts.
Those cheques or instrument of UBL which are submitted to other banks for collections, are called in ward clearing.
The cheques of other banks that are submitted to the UBL for collections are called Out-ward clearing.
The word credit comes from the Latin word “credo” meaning “I believe”. It is a lenders trust in persons/ firms/company’s ability or potential ability to command goods or services of another in return for promise to pay such goods or services at some specified time in the future. The making of loans and advances has always been prominent profitable function of bank. Sanctioning credit to customers and others out of the funds at bank Limited made in different forms, such as, loans, overdrafts, Cash, Credits, bills purchased and discounted etc. Uttara Bank Ltd. Deals with the money from the depositor repayable on demand. So, it can not afford to lock up it fund for long periods. UBL usually grant short- term advances, which are utilized to meet the working capital requirements of the borrower.
7.2. TYPES OF CREDIT FACILITIES EXTENDED BY UBL
The Credit facilities extended by UBL can be divided in to two ways:
• Staff loan
• Cash credit against hypothecation &Pledge
• Bank Guarantee
• Special Credit Program
* Small Business
* House Building Repairing
* Personal Loan
Figure: 5.1 Types of Credit Facilities offered by UBL
When a current account holder is permitted by the banker to draw more than what stands to his credit, such an advance is called an overdraft. The banker may take some collateral security or may grant such advance on the personal security of the borrower. BUL has given this overdraft facility to its clients. Overdraft facilities are generally granted to businessman for expansion of their business, against the securities of stock-in-trade, shares, debenture, Government promissory notes, fixed deposit, and life policies.
Terms and conditions:
*Interest rate is 14% in case of work order. But in case of DPS interest rate is 15%, incase of share, debenture and bond the rate is 13% and incase of FDR the rate should be interest rate on FDR plus 3%.
*Limit of the loan should be according to the sanction latter.
*Maximum loan period is 1 year.
*If the client fail to pay the bank’s due with in due date, the bank may en cash the pledge without prior intimation to client in case of movable property like DPS, FDR, Bond, share, debenture etc.
A loan facility provided by the banks to the customers against document/bills, like Bills of Lading, Warehouse keeper’s Certificate/receipts.
Terms and Conditions:
*Maximum limit up to bill value.
*Interest rate was 14.5% in the year 2003 .But now it is 14%.
*Here the loan is given maximum for 7 days.
This sort of credit is extended to the importer against trust receipt. The important goods remain in the custody of the importer. He is required to execute a stamped trust receipt in favor of the bank. Moreover, the bank retains collateral security for its safeguard.
Terms and conditions:
*Limit maximum up to L/C value.
*Time period vary from 60 days to 120 days.
*Interest rate is 14% now which was 14.5% in the tear 2003.
Such credit facility is allowed against pledge of imported goods. In this case a bank clears the goods through its approved ‘Clearing Agent’ and stores the same under its effective control. All relative expenses in connection with clearing of goods are debited to LIM account.
Terms and conditions:
*Limit maximum up to L/C value.
*Time period vary from 60 days to 120 days.
*Interest rate is 14% now which was 14.5% in the year 2003.
Staff loan is provided among the employees of UBL for making house or house repairing.
Terms and conditions:
*Must be staff of UBL.
*Loan should be adjusted from salary.
*Need a house or land for mortgage.
*Retired employees should not get such loan.
*Interest is calculated at 5.5% simple rate and bank rate.
One can get cash credit in two ways-Cash credit against hypothecation and Cash Credit against pledge. In cash credit against hypothecation the goods remain under the control of borrower. But in case of credit against pledge the goods are kept under the control of bank.
Terms and conditions:
*Must have a trading account and a shop.
*Maximum loan period is one year.
*Loan amount is set according to the sanction of the head office.
*Interest rate is 14%.
In case of bank guarantee the borrower have to keep cash margin. If he keep 100% cash margin, he need not to keep any collateral security. Otherwise he have to keep collateral for the rest amount (except margin).
7.3 Special Credit Program:
*House repairing and renovation: To get this kind of loan the applicant must have a house of his own. He will keep that house mortgage to the bank. Here the Maximum loan amount is 5 lac and the interest rate is 15%. Here loan is given maximum for five years.
*Small Business Loan: Here the applicant must have a shop of his own or with valid agreement. He should have a house or land to keep mortgage. Here the loan is given maximum for there years and interest rate is 15%. Loan can be given up to 5 lac.
*Personal Loan: Here the applicant must be a service holder and his office will secure his loan. Here the limit is 1 lac and the interest rate is 14%.
7.4. Credit Policy of UBL
UBL Credit policy contains the views of total macro-economic development of the country as a whole by way of providing financial support to the Trade, Commerce and Industry. Throughout its credit operation UBL goes to every possible corners of the society. They are financing large and medium scale business house and industry. At the same time they also takes care entrepreneurial development through its operation of small business finance.
As a part of its Credit Policy UBL through its credit operation maintains commitment for social welfare. From operational aspects it is observed that as a matter of policy-
UBL put emphasis on the customer i.e. the ‘Man’ and the “Business not on the Security” in selection borrowers.
Its takes care of diversity in Credit Portfolio.
It takes care in maintaining proper ‘Mix’ of short, medium and long term finance in its credit portfolio usually they do not go for long term finance for a period not exceeding 5 years.
Charging of interest is flexible depending on insisting of the proposal and the customer.
7.5. Processing And Screening Of Credit Proposal:
There are some common regulatory directives governed by Banking Company Act, Bangladesh Bank and the Law of the State which or to be followed strictly at the time of screening a credit proposal. In addition, credit proposal are appraised critically by UBL Credit officers from various angles to judge the feasibility or viability of the proposal.
The customer at the branches of the bank place credit proposals. When a customer comes with a credit proposal, the Credit Department of the branch makes an open discussion with the customer on different issues of the proposal to judge the worthiness of the proposal and the customer. If the proposal seems to be worthwhile in all respect then the proposal is placed to the head office credit division of the bank for sanction of loan.
If the proposal is found unviable at the Branch level they decline the same form their desk. In the same way, proposals are also decline from Head Office Credit Commitment and from board if it is not feasible one.
It is pertinent to mention that there is a Credit Committee at the Branch headed by the branch incumbent and at the Head Office headed by the Managing Director.
A loan application contain the following documents-
*Application for loan
*Mortgage property documents
*In case of limited company they need memorandum and articles of Association, joint stock up to date search report etc.
When a proposal is send to head office the following documents are needed-
*Photograph of the mortgage and the borrower
*CIB report etc
For every loan the borrower have to sign some change documents. The most common charge documents signed by the borrower are-
*Demand promissory note
*Letter of continuity
*Revival letter I
*Revival letter II
*Letter of authority
*Agreement of pledge of security
*Security delivery letter etc.
Foreign exchange deals with transfer of fund with outside country. The Export and Importers facilitates by this division. The main task of UBL are-
Terms of UBL:
*L/C Advising & Conforming
*L/C Collection & Negotiation
*Amendment of L/C
*Lodgment and retirement of L/C
L/C simply means Letter of Credit. According to Oxford Dictionary L/C can be define as a letter from one banker to another authorizing the payment of a specified sum to the person named in the letter on certain specified conditions. Commercially letter of credit is widely used in the international import and export trade as a means of payment. A letter of credit involves two parties –L/C issuing bank and the beneficiary.
Letter of credit is well accepted and the most commonly used means of payment. It is an undertaking for payment by the issuing bank to the beneficiary upon submission of some stipulated documents and fulfilling the terms and conditions mentioned in the letter of credit.
Types of L/C:
Letter of credit can be divided into two-
1. Revocable credit.
2. Irrevocable credit.
Procedure of L/C:
In the procedure from L/C opening to closing first the buyer and seller makes an agreement where the seller provides a proforma invoice to the buyer. After placing the proforma invoice to the bank, the bank able to open L/C .There is another way in which the seller has agents in different countries and places. The agent can provide indent to the buyer which has agents be placed to open L/C. Indent is not a contract or promise. To open a L/C the issuing bank has consider following documents-
*Must have an account with the bank.
*Valid trade license
*Import registration certificate
*Sector pf industry
*Types of material
*Sources of material
*Amount of L/C
*Country of origin
*TIN and VAT registration certificate
*Certificate of incorporate
*Memorandum and articles of association
*Bank solvency certificate.
After considering the document the L/C issuing bank send the L/C to the advising bank to advice the L/C to the beneficiary (seller). Then the beneficiary negotiates the L/C with the negotiating bank. L/C may have condition that it should be negotiated by the advising bank. In this case the negotiating and advising bank is same. Otherwise it can be negotiated with any other bank according to the beneficiary’s choice.
Sometimes beneficiary want to confirm his L/C with a confirming bank should be any first class international bank. Confirming bank confirm the L/C on behalf of the L/C issuing bank.
Sometimes the seller may not agree with some condition of L/C. Then he has to conduct the buyer and after their negotiation the buyer goes to L/C issuing bank for correction of L/C condition through amendment.
Then the seller supplies goods according to L/C condition and send through negotiation bank. The bill must have documents according to L/C condition. A bill generally contain the following documents-
*Bill of lading
*Bill of exchange
*Declaration of shipment
*Certificate of origin
After getting the bill documents the L/C issuing bank must make payment against document through reimbursement bank. Reimbursement bank make payment to negotiating bank on behalf of the L/C issuing bank after getting their consent. Here L/C issuing bank must have an account with the Reimbursement Bank. This account is known as NOSTRO account.
Then the buyer makes payment to the bank to get hi documents. When the buyer receives his goods, custom provide bill of entry to the L/C issuing bank. And after receiving the bill of entry the L/C issuing bank can close the L/C.
8.3. Function of foreign exchange department:
In the Commercial bank the function of foreign exchange can be identified under the following points-
*. Pre-shipment advances
*. Purchase of foreign bills
*. Negotiation of foreign bills
*. Export guarantees
*. Advising /confirming L/C
*. Advance for deferred payment export
*. Advance against bills for collection.
*Opening of letter of credit
*Bills of collection
*Import loans and guarantees
*Issuing and payment of DD, MT .TT etc
*Issuing and encashment of foreign currency notes
*Non- resident account
*Maintenance of foreign currency account
*Exchange position and cover operation
*Submission of returns
*Collection of information
8.4. Role of bank in Foreign Trade
Commercial banks play a significant role in foreign trade of a country .Some of the important roles are-
• Form unique channel through which the documents and money are exchanged between importer exporters.
• Bank extends their credit facilities to the exporter to procure raw materials, process them and prepare them for shipment to the importer.
• Bank extends post-shipment financing facility to the exporter.
• Bank render service to the exporter by advising, confirming L/C issued in favor of the exporters by their correspondent abroad.
• Bank may also execute guarantees on behalf of their export customers.
• Bank issue L/C on behalf of their import customers.
• Bank undertakes financial guarantees on behalf of their customers to effect payment against presentation of stipulated documents.
• Bank extends post import financing facility to the importer.
• Bank performs activities of inward and outward remittance.
• Open and maintain non-resident account.
GENERAL TERMS OF FOREIGN EXCHANGE
LIM: Here the bank provide loan to the applicant when the applicant does not have enough money to make payment for his documents. Bank make payment to beneficiary kept the imported merchandise on the banks.
So, such credit facility is allowed against pledge of imported goods. In this case a bank clears the goods through its approved ‘Clearing Agent’ and stores the same under its effective control. All relative expenses in connection with clearing of goods are debited to LIM account.
LTR: It is the loan given to the L/C opener after receiving the bill of the import goods. Here the bank makes payment of the bill and give the documents to the applicant on trust. Here bank does not keep any security against it. Imported merchandise is kept on the applicants store house. The importer has to pay back loan within 60 or 90 days.
So, this sort of credit is extended to the importer against trust receipt. The imported goods remain in the custody of the importer. He is required to execute a stamped trust receipt I favor of the bank. Moreover, the bank retains collateral security for its safeguard.
Bill of Exchange: Bill of exchange can be define as, “An unconditional order in writing addressed by one person to another, signed by the person giving it requiring the person to whom it is addressed to pay on demand or at fixed or determinable future time a certain sum of money to or to the order of a specified person, or to the bearer.”
Bill of Lading: It is a document of title to goods evidencing its dispatch from the exporter’s country to the importing country. It indicates the port of loading, the port of destination, name of the sipper and the buyer, notifying party and his full address as per L/C terms. Description of the goods, gross and net weight, and EXP number should be correctly stated in the B/L.
PAD: As its name implies, here the payment is made against the bill of imported documents through reimbursement bank. When the applicant makes payment of his bill and necessary chares, the PAD is adjusted. In case of back to back L/C the PAD is done on its maturity.
D/L: D/L means demand loan. It is also known as force loan. The maturity date of the bank to back L/C is previously set and accepted by the bank. If the payment of the master L/C does not come before the maturity date of the back L/C then the bank provide D/L to the applicant to pay the bill of the back to back L/C.
FBP: If the bill of an export L/C is accepted by the negotiating bank but have a forward maturity date then the bank can purchase the bill from beneficiary up to a limit. Limit is set by reducing back to back liability and other charges. Here the bank gets interest over the bill value.
IBP: Here accepted bill of local back to back L/C are purchased. Here both interest and commission is earned by the bank.
EFERQ: Here only exporter can maintain an account in foreign currency. He can deposit maximum 10% of repatriated export value. This deposit can be withdraw only for business purpose like business development, conference etc in abroad.
FBPAR: When payment of export L/C comes, it is kept on FBPAR. This account is debited to make payment of the back to back L/C on its maturity. Exceeding the back to back liability and other charges, the rest amount can be transferred to the beneficiary’s account.
IFBC: When payment of export L/C comes, the bank accepts the bill considering its documents and creates IFBC. It is created by debiting L/C liability and crediting the IFBC liability. Here the bank provides a maturity date to the beneficiary and on maturity the IFBC liability is reversed for adjustment.
OD Export: It is the pre-shipment loan facility given by the bank to the exporter. Here the L/C is lien for security. Loan can be provided 10% of his IFBC value related to export L/C.
ITT: Here money is transferred from foreign banks to local banks through telephone to a customers account. SWIFT is also used for the same purpose.
FDD: Demand drafts are issued to foreign banks and also received from the foreign banks. Drawee must have an account with the drawn bank.
NOSTRO A/c: For making payments in foreign in currency banks kept an account in foreign currency with some foreign banks for reimbursement purpose known as NOSTRO A/C. This account is maintained with the head office.
VOSTRO A/C: Some foreign banks keep an account with local banks to clear their payments in foreign currency known as VOSTRO account. This account is also maintained with the head office.
TC: A person going abroad may want to have a cheque with him for his expenditure known as TC. AD branches of a bank can issue these cheques and the bearer can convert the cheque in to cash in abroad.
In Moghbazar Branch I found only Foreign Remittance. Because this is a small Branch other foreign exchange is not in this branch. But Foreign Remittance is one of the popular Terms for this branch and I work in this department.
Foreign remittance means remittance in foreign currency that are received in and made out abroad. All foreign exchange transaction as result in the flow of foreign exchange either into the country or from the country. In trade transactions the remittance is affected by L/C and bill of exchange. Remittance for non-trade transaction is affected by TT, MT, TC, and DD and by the movement of physical currency itself.
10.2. Instruments of Remittance:
A telegraphic transfer or cable transfer is in instruction issued by cable to pay a certain some of money to a specified person.
A mail transfer is similar to a telegraphic transfer. It contains instruction to pay a certain sum to a certain beneficiary named in the transfer.
It is an order to pay a certain sum to a certain person or to his order issued by the bank drawn on its overseas branch or on its correspondent bank.
Authorized dealers act as agents of international bank and institutions for issue of travelers cheques. Issue of traveler’s cheque is made at the TC selling rate. In addition the purchaser has to pay commission for issue of traveler’s cheque.
The Portfolio Matrix is a tool for allocating resources. The portfolio Matrix was developed by Boston Consulting Group (BCG), so that it is also called BCG Matrix. It shows the linkages between business growth rate and the market share. Placing products in the BCG matrix results in 4 categories in a portfolio of a company
Business in the question mark with a high growth rate & weak market share. It usually require cash investment . In stars business in the high growth rate & strong market share. It use large amounts of cash and are leaders in the business so they should also generate large amounts of cash.
In the cash cow, business has low growth rate and strong market share. They are usually established in the market, such as: multinational company. In the dogs, the businesses have low growth rate and weak market share. This type of business are usually non profitable & generally should be close that business.
In the BCG Matrix Uttara Bank Limited stand in the question mark. Because they have high business growth rate and weak market share. If we see the last 5 years performance, we can see their business growth rate is gradually increasing compare to other leading bank in Bangladesh . For example: Prime Bank
The Loan and advance department, deposit, foreign trade is growing up.
In 2006 loan and advance department portfolio of UBL
Was 5,083.2 and in 2007 that was 3,530.9 million taka.
And Prime Bank was 16492 in 2003 & 57683 million taka in 2007.
And UBL’s Deposit in 2003 was 31,477.6 and in 2007 that was 43,586.4 million taka . And Prime Bank was 20483 in 2003 & 57683 million taka in 2007.In foreign trade UBL Import was26,204.9 million in 2003 and 25,407.9 in the year 2007. Which I see that it was Decline .Export 14,784.5 million in 2007and 20,728.9 in the year 2003.
And Prime Banks import was 25441 in 2003 & 70617 million taka in 2007,and export was 16490 in 2003 & 51316 million taka in 2007.
In the Introduction stage, the product is introduced to the market through a focused and intense marketing effort designed to establish a clear identity and promote maximum awareness. Many trial or impulse purchases will occur at this stage.
This is the second stage of Product Life Cycle. At this stage people know about the product & the demand of the product grows up rapidly & profit also goes up at this stage. The Deposit of UBL’s are now in the growth stage, because UBL’s innovative products including NMS and NDS attached a huge number of customers, which contribute the growth of deposit. If we follow the last 5 years performance of Deposit of UBL’s we can see the UBL has been able to increase their Deposit. From 31,477.6 in 2003 to 43,586.4 in 2007 (Tk in million).
This is the third stage of Product Life Cycle. Arrival of the product’s Maturity stage is evident when competitors begin to leave the market, sales velocity is dramatically reduced, and sales volume reaches a steady state. At this point in time, mostly loyal customers purchase the product. But in this stage no one can stay longer.
It is the last stage of Product Life Cycle. Continuous decline in sales signals entry into the Decline stage. The lingering effects of competition, unfavorable economic conditions, new fashion trends, etc, often explain the decline in sale.
• Posting the experience employees in the branches which are in loss.
• Motivated the employees.
• Introduce more schemes.
• Maintain good relationship with the customers.
• Concentrate in those areas where competitors is less and weak.
• Reduce Physical work by using automation.
• Involves in social work with adequate marketing.
• Training program should be increase/
• Online banking facility should be given to the customers.