Report on Brand Survey of City Bank in Bangladesh
The need of banks is undeniable in any economy. Banks are financial institutions which deal in money. It takes in money from those who are not using them at the moment and lends it to those who are in a position to use them for production purpose. There are a number of commercial banks in Bangladesh who are providing various kinds of banking services to their clients. Among these banks, there are local banks as well as some renowned foreign banks.
Citibank, N.A. Bangladesh is one of the leading foreign banks in Bangladesh in terms of their services. Citibank, which operates under the umbrella of Citigroup, is the worlds’ leading financial organization. They are also considered as one of the most famous brands in the world. Branding is considered to be as one of the most important factors in this industry which can lead a firm to its peak.
Branding in Citibank, N.A. Bangladesh is mainly carried out by the Corporate Affairs Department of the bank. The major responsibilities of this department are to maintain liaison with different organizations, especially with those who work in close proximity with Citibank, Bangladesh. This department is very crucial for the bank as it establishes relationship with other organizations in the corporate world.
It also maintains relation with internal and external customer. Sometime there might be crisis situation that could be unheard of, that time this department takes active role to protect reputation and brand value of the Citigroup. Moreover, this department arranges various seminars and workshops and also takes the initiative in undertaking various training programs to enhance the knowledge of the employees regarding Citibank, its customers and suppliers.
This report tries to find out the brand awareness of the Bangladeshi people about the multinational banks that are operating in Bangladesh, in this regard, a survey is being carried out. It is very clear from the survey that the Standard Chartered Bank is dominating the market for multinational banks in Bangladesh. This is mainly because of the vast and diversified services they offer to their clients.
Moreover they are operating in the Bangladeshi market for a long period of time with huge success. They have been the pioneer in introducing many new products than any other banks in Bangladesh. Though being the world’s leading financial institution, Citibank, N.A. Bangladesh is also lacking behind mainly because of the lack of consumer banking in Bangladesh. People are more aware about the slogans and logo of Standard Chartered Bank than any other bank.
Most of them believe that reputation, financial stability, reasonable charges, service attitude of employees, technology adoption, global service network and new product innovation are the main reasons behind selecting any multinational bank in Bangladesh. They also consider that the multinational banks they are using are sufficiently providing these facilities in order to provide the best possible services.
Citibank, N.A. Bangladesh lacks certain features that have hindered them to promote their brand image more successfully in the Bangladeshi market. Lack of consumer banking, efficient promotional efforts, intense competition, similar names of some local organizations, lack of inter-branch coordination and lack of detailed layout of the corporate affairs department can be considered as the leading factors for their branding problems. These problems can be encountered by implementing strategies that include introducing consumer banking, more extensive promotional campaign, restructuring of the corporate affairs department, gifts to clients, improving the layout of the office and more inter branch coordination.
Background of the study –
Generally by the word “Bank” we can easily understand that the financial institution deals with money. But there are different types of banks such as Central Banks, Commercial Banks, Savings Banks, Investment Banks, Industrial Banks, Co-operative Banks etc. But when we use the term “Bank” without any prefix, or qualification, it refers to the ‘Commercial banks’. Commercial banks are the primary contributors to the economy of a country. So it can be said that commercial banks are a profit-making institution that holds the deposits of individuals & business in checking & savings accounts and then uses these funds to make loans. Both general public and the government are dependent on the services of banks as the financial intermediary. As, banks are profit-earning concern; they collect deposit at the lowest possible cost and provide loans and advances at higher cost. The differences between two are the profit for the bank.
Banking sector is expanding its hand in different financial events every day. At the same time the banking process is becoming faster, easier and the banking arena is becoming wider. As the demand for better service increases day by day, they are coming with different innovative ideas & products. In order to survive in the competitive field of the banking sector, all banking organizations are looking for better service opportunities to provide their fellow clients. As a result, it has become essential for every person to have some idea on the bank and banking procedure.
Methodology
Source of information:
Primary sources of information:
- Employees working in different sectors in Bangladesh including financial institutions, service-oriented organizations, nongovernment organizations (NGOs) and government organizations.
Secondary s sources of information:
- Official website of Citibank, N.A. Bangladesh
- Publications about Citibank, N.A. Bangladesh
- Journals
Data collection method:
In order to obtain maximum possible information, both primary and secondary sources of data were used.
Primary data was collected with the help of questionnaires and for secondary data, Websites of Citibank, N.A. Bangladesh and its competitors, their annual reports and other related publications were reviewed.
Organization Background –
Citigroup
Citigroup Inc. (NYSE: C) is a major American financial services company based in New York City. According to Forbes Global 2000, it is the world’s largest company and the most profitable financial services firm. Its formation was announced on April 7, 1998 through a merger of Citicorp and Travelers Group. It was the first US Company to combine banking with insurance underwriting since the Great Depression. The company has just under 300 000 employees and over 200 million customer accounts in more than 100 countries, with total assets of nearly 1.6 trillion USD. It is a primary dealer in U.S. Treasury securities and its stock is a component of the Dow Jones Industrial Average.
On September 5, 2006, Citigroup announced that Singapore’s Minister Mentor Lee Kuan Yew had agreed to be its Special Advisor. He will provide counsel to Citigroup’s senior management and its Board on international developments that impact on economies and businesses globally.
World Market Share
Although it is one of the largest companies in the world, Citigroup only had a 5% global market share of its industry in 2003. The financial services sector, though the largest industry in terms of earnings, is also the most fragmented in terms of companies. Citigroup had a 10% share of the “capital markets & banking” (corporate and investment bank division) in 2003.
The Thomson Financial League Tables tracks the underwriting and M&A segment of that in more detail.
2003 global (except Retail Banking) market share:
- Capital Markets and Banking: 10%
- Consumer Finance: 6%
- Private Client Services: 5%
- US Retail Banking: 4%
- Transaction Services: 2%
- Private Bank: 2%
History of Citigroup
The history of the corporation now known as Citigroup is primarily the history of two separate organizations, Citicorp and Travelers Insurance. Citicorp was a multinational banking corporation operating in nearly 100 countries. Travelers was an amalgamation of many different companies beginning with Commercial Credit in Baltimore and gradually expanding with purchases of Primerica (consumer finance), Smith Barney (brokerage) and Traveler (Insurance).
At the time of the merger between Citicorp and Travelers, Sandy Weill was the chairman of Travelers and John Reed was the Chairman of Citicorp. Under the auspices of creating a one-shop stop for insurance and banking products, the merger became a takeover by Travelers shortly thereafter. The two CEOs could not have been more different in management style and their paths to the top.
Initially setup as co-CEOs, within two years of the merger John Reed was no longer with Citigroup. Of note, roughly at the time of the merger, Sandy Weill’s compensation was on the top 10 list for CEOs, while John Reed’s compensation was considered one of the top 10 for being the most accurate reflection of performance for pay.
Traveler’s history
Primerica was a conglomerate patterned after the modern General Electric by the famous mutual fund manager Gerry Tsai. As GE was doing at the time, Tsai was trying to position Primerica heavily into the financial services realm, acquiring A L Williams, a life insurance company that started the “buy term, and invest the difference” philosophy, and Smith Barney, a large stock broker. He bought Smith Barney at the height of a bull market, and the resulting stock market crash put a tremendous strain on the overall company, forcing him to sell. Tsai had inserted lucrative golden parachutes into his contract agreements because he knew he was going to have to sell, which made the deal more expensive than Commercial Credit was willing to pay. Weill was eventually convinced to go ahead with the deal because he would then be able to use Primerica’s Gulfstream G4 jet, something which the Commercial Credit board of directors was not willing to pay for.
Upon acquiring the company in 1988, Weill spun off the non-financial businesses of the conglomerate, and attempted to institute the practice of “cross-selling” (also called “cross-servicing”), which he had used previously at American Express. Instead of the corporation owning a stock brokerage, insurance agency, and consumer finance company and letting them each run essentially separately, Weill was interested in each selling each others’ products. For example, the insurance agents could sell Smith Barney mutual funds.
During this period Weill became interested in the Travelers Insurance Company, which had come to Weill for a cash injection because of losses sustained during Hurricane Andrew. Weill also inserted management into that company to oversee operations and cost cutting. This eventually led to the acquisition of Travelers Insurance.
The Travelers Insurance acquisition added property and casualty, and life and annuities underwriting capabilities to the group. It also brought along the Travelers red umbrella logo, which Weill applied to all the businesses within the group. During this time Travelers acquired Shearson, which was a large stock brokerage Weill used to run. It then acquired Salomon Brothers, a famous investment bank. Weill attempted to negotiate a deal to merge with JP Morgan, but this was rejected because the JP Morgan CEO would have wanted to become CEO of the combined company. Weill was eventually successful at convincing John Reed, the CEO of Citicorp, to merge.
Divisions
Citigroup is divided into three major business groups: Global Consumer, Global Wealth Management, and Corporate and Investment Banking. It also includes one stand-alone business, Citigroup Alternative Investments.
The Global Consumer Group comprises three sub-divisions: Cards (credit cards), Consumer Finance, and Retail Banking. The credit card business on average delivers about 40% of the profits of this group. Citigroup is the largest provider of credit cards in the world, a position long held by Citicorp, and increased by many acquisitions of card portfolios. It provides credit cards in many countries even where it doesn’t have branches, and advertises directly on TV and by direct mail. The Consumer Finance Division (called CitiFinancial) accounts for about 20% of the consumer group’s profits. This division engages in the controversial practice of high interest rate lending to people with bad credit histories, called “loan sharking” or “predatory lending” by critics. Although this was the core of the corporation from which other divisions were acquired, most of the size, stores, and global reach of this division came from the takeover of Associates First Capital. CitiFinancial is now the largest consumer finance company in the world.
The final division is the retail bank. This division consists of the normal retail branch system that banks are most known for. This goes by the brand name “Citibank”. Citibank is the third largest retail bank in the United States, and it has branches in countries throughout the world.
The biggest part of retail banking however is Banamex, the largest bank in Mexico, which Citigroup owns. Overall the Global Consumer group contributes more than half of all the profits for Citigroup. If it were a separate company, it would still be in the top ten most profitable companies in the world.
The Corporate and Investment Banking division consists of three subgroups Global Markets, Global Banking, and Global Transaction Services. This division essentially handles large corporate cash management, trade, lending, and investment banking services. Citigroup’s investment bank is one of the largest, frequently topping many league tables. It does not engage in as much proprietary trading (stock and bond speculation) as do other investment banks.
The Global Wealth Management division is comprised of The Citigroup Private Bank, Smith Barney, and Citigroup Investment Research. The Citigroup Private Bank provides banking and investment services to high net worth individuals, private institutions, and law firms. Smith Barney is the second largest stock broker in the world.
The Citigroup Alternative Investments group is an alternative investments platform that manages assets across five classes: private equity, hedge funds, structured products, managed futures, and real estate. Essentially it offers various funds or separate accounts that utilize alternative investment strategies, as opposed to the mainstream mutual funds that it recently sold to Legg Mason.
These kinds of funds are not as commoditized as normal mutual funds, and products such as “structured products” are hybrid debt/equity/derivative issuances underwritten by its Investment Banking division. It offers over eighty investment products to institutions and qualified individual investors.
History of Citibank N.A.
Citibank was founded in 1812 as the City Bank of New York. Citibank is now the consumer and corporate banking arm of financial services giant Citigroup, the largest company of its kind in the world. It is the third largest bank by holdings behind Bank of America and JP Morgan Chase & Co.
Founded in 1812 as the City Bank of New York by a group of New York merchants, the bank’s first head was Samuel Osgood, who had been the U.S.’s first Postmaster General. Subsequently, ownership and management of the bank was taken over by Moses Taylor, a protégé of John Jacob Astor and one of the giants of the business world in the 19th century. During Taylor’s ascendancy, the bank functioned largely as a treasury and finance center for Taylor’s own extensive business empire.
In 1865 the bank joined the U.S.’s new national banking system and became The National City Bank of New York. By 1894, it was considered one of the largest banks in the United States, and in 1897, it became the first major U.S. bank to establish a foreign department. In 1913 it was the first contributor to the Federal Reserve Bank of New York.
National City became the first U.S. national bank to open an overseas banking office when its branch in Buenos Aires, Argentina was opened in 1914. Many of Citi’s present international offices are older; offices in London, Shanghai, Calcutta and elsewhere were opened in 1901 and 1902 by the International Banking Corporation (IBC), a company chartered to conduct banking business outside the U.S., at that time an activity time forbidden to U.S. national banks. In 1918, IBC became a wholly owned subsidiary and was subsequently merged into the bank.
By 1919 the bank had become the first U.S. bank to have $ 1 billion in assets. Charles E. Mitchell was elected president in 1921 and in 1929 was made chairman, a position he held until 1933. Under Mitchell the bank expanded rapidly and by 1930 had 100 branches in 23 countries outside the United States.
In 1952, James Stillman Rockefeller was elected president and then chairman in 1959, serving until 1967. Following its merger with the First National Bank, the bank changed its name to The First National City Bank of New York in 1955, then shortened it to First National City Bank in 1962, and ultimately changed it to Citibank in 1976. By that time, the bank had created its own “one-bank holding company” and had become a wholly-owned subsidiary of that company, Citicorp (all shareholders of the bank became shareholders of the new corporation, which became the bank’s sole owner).
In the 1960’s the bank entered into the credit card business. In 1965, First National City Bank bought Carte Blanche from Hilton Hotels. However after three years, the bank (under pressure from the U.S. government) was forced to sell this division. By 1968, the company created its own credit card. The card, known as “The Everything Card,” was promoted as a kind of East Coast version of the BankAmericard. By 1969, First National City Bank decided that the Everything Card was too costly to promote as an independent brand and joined Master Charge (now MasterCard).
In 1981, Citibank chartered a South Dakota subsidiary to take advantage of new laws that raised the state’s maximum permissible interest rate on loans to 25 percent (then the highest in the nation). In many other states, usury laws prevented banks from charging interest that aligned with the extremely high costs of lending money in the late 1970s and early 1980s, making consumer lending unprofitable.
Citibank was one of the first U.S. banks to introduce automatic teller machines in the 1970s, in order to give 24-hour access to accounts.
Citibank’s operations in California are fairly recent, since it bought out Cal-Fed in 2001. Also in 2001, Citibank settled a $45 million class action lawsuit for improperly assessing late fees. Following this Citibank lobbied in Congress to pass legislation that would limit class action lawsuits to 5 million dollars unless they were initiated on a federal level. Some consumer advocate websites report that Citibank is still improperly assessing late fees.
In August of 2004, Citibank entered the Texas market with the purchase of First American Bank of Bryan, Texas. The deal established Citigroup’s retail banking presence in Texas, giving Citibank over 100 branches, $3.5 billion in assets and approximately 120,000 new customers in the state. First American Bank was renamed Citibank Texas after the take-over was completed on March 31, 2005.
It is hoped that with both California and Texas markets, Citibank can appeal to both states’ Latino population, and offer products on both sides of the border through Citibank in the U.S., and Banamex (Citigroup’s Mexican division) in Mexico.
Citibank has operations in more than 100 countries and territories around the world. More than half of its 1,400 offices are in the United States, mostly in the New York City, Chicago, Miami, and Washington DC metropolitan areas, as well as in California.
In addition to the standard banking transactions, Citibank offers insurance, credit card and investment products. Their online services division is among the most successful in the field, claiming about 15 million users.
In April of 2006, Citibank struck a deal with 7-Eleven to put its ATMs in over 5,500 convenience stores in the U.S. In the same month, it also announced it would sell all of its Buffalo and Rochester New York branches and accounts to M&T Bank.
Citibank N .A. Bangladesh
Citibank N.A. is a foreign private bank in Bangladesh. The Bangladesh branch commenced its banking operations on 24 June 1995 after obtaining license from Bangladesh Bank in January 1995. Before starting full-fledged banking activity through the branch at Dhaka established a foreign representative office here in 1987. The present branch of the bank is the upgraded and transformed shape of the representative office. Citigroup Inc., a merger of Citicorp Inc. and Travelers Group Inc. formed on 8 October 1998, is a bank holding company under the laws of United States of America. It is the sole shareholder of Citibank N A and its head office in New York governs the businesses of its Bangladesh branch. The bank commenced business in Bangladesh with a paid up capital of Tk 204 million and total assets of Tk 809 million.
The principal activities of the Dhaka branch of Citibank N.A. are to provide all kinds of commercial and merchant banking services to its customers. Deposit mobilization of the bank during the initial six months of its operations in Bangladesh amounted to Tk 541.89 million, which rose to Tk 1,577 million in 2000. The deposits were in traditional savings, current, fixed and other accounts.
The interest rates offered by the bank on various deposit accounts since August 2000 have fluctuated between 5.50% and 8.50%. The amount of time deposits in the bank stood at Tk 1,435.7 million on 31 December 2000. The bank has its deposits with other banks within and outside Bangladesh.
Total volume of lending of the bank was Tk 624.2 million in 2000. The bank had no classified non-performing loans up to 31 December 2000. In addition to traditional lending activities, the bank is extensively involved in long-term financing in Bangladesh through equity participation and in other forms of term investments. It has equity participation in Shinepukur Ceramic Ltd and the country’s first private television channel Ekushey (ETV). The bank issued and sold floating rate certificates of $87.00 million in New York to finance the establishment of the 110-MWatt barge-mounted powerplant at Haripur in Naryanganj under the guarantee of a US investment company. In addition, the bank also provided huge long-term funding support to AES-Haripur Ltd, a 350- MWatt combined cycle power plant, and to Khulna Power Company Ltd (KPCL).
Citibank N A provided support to large, medium and small scale industries in the form of working capital financing, medium and long-term financing, export servicing and import financing, and loans and advances to trade and commerce.
Lending rates on these financing schemes varied between 8% and 16.50% during its operations in Bangladesh.
Citibank N A borrowed Tk 60 million in 1995, Tk 352.2 million in 1999, and Tk 442.8 million in 2000 from other banks and financial institutions. The bank’s lending in the inter-bank call money market was Tk 110 million on 31 December 2000. Total investment of the bank stood at Tk 630 million on the date as against Tk 290 million in 1998. The investment was in government Treasury Bills only.
The foreign exchange business handled by the bank during 1999 amounted to Tk 3,243 million, comprising export servicing (Tk 19 million), import financing (Tk 2,170 million) and remittance services (Tk 1,054 million).
At the time of commencement in 1995, Citibank N A had total assets of Tk 809 million, which in 2000, increased to Tk 4,647.4 million excluding off-balance sheet assets worth Tk 1,747.8 million. Gross earning assets of the bank were valued at Tk 2,160.1 million in 2000.
The bank maintained its liquid assets in the form of short-term investments in government treasury bills and deposits with other banks and financial institutions in the host and home countries. In 2000, these assets amounted to Tk 1,617.2 million and were considered sufficient to resolve its current debt and other liquidity obligations. Citibank N.A. performed well in terms of its net profits almost each year except in 1995, when it incurred a loss of Tk 24.88 million. Its income was derived mainly from interests, discounts, commissions, and brokerages.
Services at Citibank N.A. Bangladesh
Corporate Banking
Corporate Banking group provides a comprehensive range of financial services including treasury management, transaction services, securities custodianship, foreign exchange, and corporate finance to corporate clients.
Their expertise involves offering innovative and customized solutions to business and institutions, both foreign and local, by harnessing on their global capabilities to bring about world’s best practices for local capacity building.
The corporate bank offers a one-stop solution combining lending & advisory services, treasury, cash management, and structured finance, to meet the specialized requirements of the customers. They are strongly supported by our international presence and interconnectivity in over 100 countries.
Every customer at Citibank Bangladesh has an individual Relationship Manager who is responsible for both the day-to-day management of customers’ account and their future corporate needs.
Financial Institutions
In today’s competitive environment financial institutions are striving to be ahead by offering superior and efficient products and services. At Citibank Bangladesh, the bank understand customers’ needs and offer a range of correspondent banking services, which will help them to stay ahead of the competition.
In Bangladesh, Citibank N.A. has three full service branches catering to the needs of FI customers – two in Dhaka, the capital city, and the other in Chittagong, the port city of Bangladesh. The bank’s team’s main objective is to liaise with the FI customers and overseas Citibank counterparts to offer seamless service. The bank’s back office handles pre-processing of FI payment instructions and reimbursement authorities and provides one stop customer inquiry handling services. They also confirm LCs for FI s that has credit lines with the bank.
Sales & Trading
As a part of the world’s premier financial solutions provider Citigroup, Citibank N.A.’s Sales and Trading desk also strives to offer the world’s best treasury products to its customer’s at the most professional and competitive manner. As an acknowledgement of the banks’ continued dedication to serve the customers the very best, the bank have been ranked number one treasury bank by many international journals time and again.
Keeping in tune with the international reputation, Citibank N.A., Bangladesh has also gained the confidence and respect of the customers it serves. The bank offers niche products to cater to the specific and sensitive requirements of the valued customers. They strive to lead changes with the maturity of local markets, bringing in the world-renowned, sophisticated products and services at the earliest instance of any scope being available to do so.
Human Resource Department
Every little step, each of the employees take on, promotes the graceful values of Citigroup; helps it to move closer to its ultimate goal- to be the most respectful financial services company. Everyone of Citigroup family conceive the thought of 5-point plan to support the franchise and individual as well. Citigroup members are greatly motivated by the virtue of Shared Responsibilities-responsibility to each other, to the clients and also to the franchise. The bank takes pride in the values they live which are actually the bases of the banks’ culture of success.
These values include Integrity, Excellence, Respect, Teamwork, Ownership and Leadership. Citigroup is one of the industry’s most powerful platforms for financial products and services.
Credit regarding it goes to their ability to attract some of the most talented people in any industry. Citigroup provides its employees with the chance to develop an exciting and widespread career in one of the world’s leading organizations. The bank believes in employee ownership offers a unique chance to experience entrepreneurialism on a global scale, and a worldwide association enables the employees to work with and learn from a diverse group of personnel whose insight, integrity, and commitment set the standard for accomplishment in the industry.
Human Resource Department of Citibank, N.A. Bangladesh endeavors to ensure growth by providing a work environment where diversity is embraced, where people are promoted on their merits, and where people treat each other with mutual esteem and dignity. Aligned with the global effort, the bank is committed to being a company where the best people work; where opportunities to develop are widely available; where innovation and an entrepreneurial spirit are valued.
Training programs for nurturing task proficiency and leadership valor of Citigroup mark another milestone in the development of talent. As highlighted by the Shared Responsibilities, providing opportunities for employees to realize their potential is an area of high priority.
To support a colossal revenue targets, HR division is equipped with some short term and long term strategies in terms of manpower planning, recruitment, employee retention, training and development and ensuring congenial working atmosphere to exert highest possible productivity.
CitiService®, Bangladesh
CitiService is an integrated customer inquiry unit dedicated to giving clients’ easy access to accurate answers in the shortest possible time. Presently they are responsible for all after sales queries received from it’s FI, Corporate, Trade & Cash-management clients and also manages a part of service-delivery.
At ’’CitiService” it has been a constant endeavor to provide value-added service to the esteemed customers. The bank’s team of service oriented personnel and well-defined processes are geared towards providing their clientele speedy and accurate query resolution. They are conscious of the importance of timely delivery of information to their customers. After it was established in 2002 to till to-date CitiService has been covered wide range of area and become a well known unit to all its FI/Corporate clients and as well as to its internal customers.
Building a strong relationship with the all overseas branches and regional/global escalation points for resolving any service related issue.
Brand Survey of Multinational Banks in Bangladesh
Introduction to the multinational banks in Bangladesh –
HSBC
The HSBC Group, one of the world’s largest banking and financial services organizations, had its beginnings in Hong Kong more than 140 years ago. Today, the HSBC Group has over 9,700 offices in 77 countries and territories in Europe, the Asia-Pacific region, the Americas, the Middle East and Africa.
HSBC (Hong Kong and Shanghai Banking Corporation Limited) obtained license from Bangladesh Bank on 17 April 1996 to conduct banking business in the country and commenced formal banking operations on 3 December 1996 through opening a branch at Dhaka. In Bangladesh, the HSBC Group is represented by Hongkong Bank, which has its head office in Hong Kong and a holding company, HSBC Holding Pic, which is incorporated in England.
Standard Chartered Bank
Standard Chartered Bank a banking company chartered in England by the Royal Charter 1853 and headquartered in London. Standard Chartered Bank started its business in Bangladesh in 1948, opening its first branch in the port city of Chittagong. The bank increasingly invested in people, technology and premises as its business grew in relation to the country’s thriving economy. At present the bank has 6 offices in Dhaka Chittagong and Sylhet, including the country’s only offshore banking unit inside the Dhaka Export Processing Zone at Savar.
In April 2000, Standard Chartered Bank PLC bought the global banking business of the ANZ Grindlays Bank Pic from the ANZ Group, following which the branches of ANZ Grindlays Bank Pic in Bangladesh became units of the Standard Chartered Grindlays Bank Limited. Standard Chartered’s services in Bangladesh, ranges from Personal & Corporate Banking to Institutional Banking, Treasury and Custodial services.
State Bank of India
State Bank of India is India’s largest bank with a branch network of over 9000 branches and 7 associate banks located even in the remotest parts of India. State Bank of India (SBI) offers a wide range of banking products and services to corporate and retail customers.
State Bank of India the only branch of the bank operating in Bangladesh since 5 May 1975. State Bank of India was incorporated in India under State Bank of India Act 1955. The bank provides all kinds of commercial banking services.
Bank Alfalah
Bank Alfalah Limited was incorporated on June 21st, 1997 as a public limited company under the Companies Ordinance 1984. Its banking operations commenced from November 1st, 1997. The bank is engaged in commercial banking and related services as defined in the Banking companies’ ordinance, 1962. The Bank is currently operating through 104 branches in 36 cities, with the registered office at B.A. Building, LI. Chundrigar, Karachi. Since its inception, as the new identity of H.C.E.B after the privatization in 1997, the management of the bank has implemented strategies and policies to carve a distinct position for the bank in the market place.
Woori Bank
Woori Bank is a bank headquartered in Seoul, Korea. The bank was established in 2002, and includes the former Sangup Bank, Hanil Bank, and Korea Peace Bank. It was once called Hanvit Bank. Woori Bank is a part of the Woori Financial Group. In 2004, Woori Bank opened Gaeseong Industrial Complex branch, in Gaeseong, North Korea.
Woori Bank, Dhaka branch is a branch of Woori Bank, Seoul, Korea (“Head Office”). Their branch was established in September 21, 1996 with a view to providing generous support to foreign investors, Korean investors in particular as well as to the prospective customers from all across the globe in general. Our vision is to emerge as the dominant banking institution in Bangladesh having a fast & visible presence in the region in the days to come.
The branch plays a leading role in Bangladesh’s financial industry in terms of customer service, high speed operation, systematic loan procedure and the cutting edge superior IT platform to provide information & services to our customers.
National Bank of Pakistan
The National Bank of Pakistan has its headquarters in Karachi, Pakistan. It has over 1,200 branches throughout Pakistan. The bank provides both commercial and public sector banking services. It has assets worth $9 billion in 2004. Its subsidiaries include NBP Capital, NBP Modaraba Management Company, NBP Exchange Company, Taurus Securities, NBP Almaty et al. National Bank of Pakistan (NBP) a banking company incorporated in Pakistan. It commenced banking operations in Bangladesh as a foreign commercial bank on 31 August 1994 with a total paid up capital of Tk 100 million. On 31 December 2000, the total capital and reserves of the bank stood at Tk 136.2 million, which was not adequate in terms of the capital adequacy ratio requirements of the taka equivalent of $10 million. The only branch of the bank in Bangladesh is at Dhaka.
Habib Bank Limited
Habib Bank Limited (commonly referred to as “Habib Bank”) is the largest bank in Pakistan. An extensive network of 1425 branches in Pakistan and 55 international branches makes the its the largest bank in Pakistan today. Habib Bank Plaza located in Karachi, Sindh is the formal headquarters of the bank. The bank has a large network outside Pakistan including USA, UK, Middle East, Asia Pacific and Africa. Habib Bank Limited a Pakistani commercial bank that started business in Bangladesh on 9 July 1976 with two branches, one at Dhaka and the other at Chittagong.
Commercial Bank of Ceylon
The Commercial Bank of Ceylon is one of the leading commercial banks in Sri Lanka with over 100 branches. It incorporated as a public limited liability company in Sri Lanka on June 25, 1969, under the Companies Ordinance No 51 of 1938 and quoted in the Colombo Stock Exchange in March 1970. It is a licensed commercial bank under the Banking Act No 30 of 1988.
In 2003 Commercial Bank acquired Credit Agricole Indosuez (CAI) operations in Bangladesh consisting of 2 branches in Dhaka and Chittagong and the 2 booths in Gulshan and Sonargaon. Commercial Bank, while continuing CAI’s strategy would further extend the reach and range of services in Bangladesh. Over a period, our bank would strengthen the retail banking side as well, for which Commercial Bank has made its name in Sri Lanka.
Shamil Bank of Bahrain
Shamil Bank is incorporated in the Kingdom of Bahrain and has grown steadily since 1982 to become a leading Islamic institution with shareholding equity of US$ 338 million and assets under management of some US$ 2.1 billion. The Bank provides a diverse range of products and services that cater for the financing and investment needs of individuals and institutions.
It conducts its business in strict compliance with the principles of Islamic Sharia. Shamil Bank is a subsidiary of the Dar Al-Maal Al-lslami Trust, one of the world’s leading Islamic financial organizations. Other shareholders include prominent Saudi and Bahraini entities and high net worth individuals. Shamil Bank of Bahrain EC, Dhaka is a bank that started business in Bangladesh as a branch of Faysal Islamic Bank of Bahrain EC (Islamic Bankers) in March 1997 after obtaining necessary permission from Bangladesh Bank.
Results of the survey
The sample population chosen for this survey was 100 people working in different sectors of the economy in Bangladesh. Out of 100 people, 62 of them participated in the survey by filling in the questionnaire which was given to them. So the response rate is 62%.
Age level
This survey has been conducted among people of different age groups. People below the age of eighteen years were excluded as they might not have yet entered into the professional world. Most of the respondents seemed to be middle-aged persons while a few are above the age of 45 years.
Gender
79% of the respondents were male whereas only 21% of the respondents were female.
Education level
49 respondents have completed their post-graduation degrees from different universities. Only 10 of the respondents completed their graduation, while 3 of the respondents have only passed their high school degrees.
Occupation level
Out of the 62 respondents, 13 of them have their own businesses in Bangladesh. 9 of them are employed in high-level management in organizations, 7 of them in middle-level management while 19 of them are currently employed in entry-level positions in an organization. 14 respondents are engaged in other professions like doctors, lawyers, etc.
Industry
Most of the respondents belong to the finance industries and service-oriented industries, while the others are from IT sectors, communication industries, manufacturing industries and government organizations.
Income level
Most of the respondents belonged to a monthly income level of between BDT 30000 to BDT 50000. 9 of the respondents have an income level above BDT 50000 while 3 of them earn more than BDT100000 a month. Some of the respondents have also decided not to reveal their income levels.
Frequently used multinational bank
Most of the respondents are using the services of Standard Chartered Bank which is considered the leading bank in Bangladesh. This is because of their diversified services, convenient operations and greater customizations. HSBC comes thereafter as the frequently used bank. While there are only few people who uses the services of Citibank, N.A. Bangladesh, Commercial Bank of Ceylon and State Bank of India. Though being the world’s leading financial institution, Citibank, N.A. Bangladesh is not so frequently used by people as they only perform corporate banking in Bangladesh for the last ten years. They do not provide the elaborate facilities that are provided by other commercial banks in Bangladesh.
Commercial Bank of Ceylon and State Bank of India are also used by small number of people as because they have been operating in the market for a short period of time.
Reputation
Most of the respondents think that reputation is a very important criterion for selecting a bank. While only a few think different that reputation may not be a important criterion for judging a bank.
More than 60% of the respondents think that the bank that they use is well reputed and it matches the image of reputation. They believe that the multinational bank has served well to maintain its reputation. While only a small number of respondents think that their bank has failed to match the image of reputation.
Financial stability
Around 50% of the respondents think that financial stability is a major criterion for selecting a bank. Whereas near about 40% think that they do not favor the fact of financial stability for choosing a bank.
More than 60% respondents think that the multinational bank they have used is financially stable and has a sound position in the market. Whereas only a small number thinks that their multinational bank is not financially stable and is not reliable.
Reasonable charges
Almost 70% of the respondents think that charges for the services of multinational banks should be reasonable and is therefore an important criterion for choosing a bank. Charges might include interest rates on credit cards, loans, overdrafts, etc.
There is a mixed feeling among the respondents about the charges they have faced in their multinational banks for services rendered. Half of the respondents believe that the charges are reasonable while the rest half thinks that the charges are way to high for them.
Professionalism
More than 40% of the participants feel that professionalism is necessary and is a very important factor for selecting a multinational bank. They prefer that the multinational banks should be very professional in their approach which can guarantee more efficient services. While 50% feel that it is not important while selecting banks.
Around three-fourth feels that the multinational bank they use is very professional in their approach. While only 8% feels that their bank is not professional in their works and is thus inefficient.
Service attitude of employees
More than 90% of the respondents feel that the service attitude of the employees is very important while selecting a multinational bank for services. Failure to show positive attitude will definitely oblige clients to go for other banks as they do not feel their importance to the banks.
It is very surprising to see that 60% respondents feel that the service attitude of multinational banks in Bangladesh is not satisfactory. Most of the times, they are not treated well by the service employees of the banks and their complaints are sometimes ignored rather than being solved.
Technology Adoption
Technology adoption is considered very important by most of the respondents as an important criterion for selecting a multinational bank. More sophisticated technology means more convenience for the clients and hence more satisfaction.
More than 80% of the respondents think that the multinational bank they use is using the updated technology which is providing them elaborate facilities for their convenience. These facilities include ATMs, credit cards, debit cards, sms banking, phone banking, etc. This is one of the services that make the respondents think the multinational banks are leading the market over the local banks.
Global service network
It is very important for the multinational banks to provide a global service to their clients. Most of the respondents feel that the multinational banks should provide them enough access to the global world where they can help their clients in dealing with international transactions and other services.
More than three-fourth of the respondents feel that the multinational bank they use provides them the privilege of global access to many different parts of the world and is thus helping them to build international trade relations.
Understanding local culture
Many of the respondents think that the multinational banks should be more customized to the local culture whereas there are also believers who prefer that the multinational banks should remain like an international bank and should not customize much or it might lose its sovereignty.
Around half of the respondents believe that the multinational bank they use understands the local business climate and customizes many of its services to fit the purpose of the Bangladeshi people.
Product innovation
Almost 80% of the respondents think that it is very important or the multinational banks to come out with new products for their clients to meet their different needs. More services the banks provide, more convenience to the clients as they can get to use all the services under one roof.
More than 50% of the respondents feel that the multinational banks are not innovative and are not coming out with new products to cater the different needs and wants of people. They believe that the local banks are more aggressive in introducing new products to their clients.
Awareness about slogans
Most of the respondents are aware about the slogans of the different multinational banks in Bangladesh. They are more aware of the slogans made by the Standard Chartered Bank, HSBC and Citibank, N.A. Bangladesh. Among these three banks, most recognized slogan to the respondents is of the Standard Chartered Bank – “We are your Right Partner”. This is because of the extensive promotional campaigns carried out by the bank and the elaborate facilities provided by them to their clients. HSBC is ranked second for their slogan “The World’s Local Bank”. While Citibank, N.A. Bangladesh is ranked third for their slogan – “The city never sleeps”. Though operating only for corporate clients, the recognition Citibank, N.A. Bangladesh has established is extraordinary and outstanding.
Slogans match performance
Most of the respondents think that the slogans made by the multinational banks in Bangladesh are relevant to their performances they show in Bangladesh.
There are a few who thinks that the banks are not performing as they claimed in their slogans. Some of the clients of Standard Chartered Bank complained that the attitude of the front desk executives are not satisfactory and most of the times their problems are ignored. But clients of HSBC, Citibank, N.A. Bangladesh and other multinational banks do not have much complains and are satisfied with the services and facilities provided by their banks.
Easily recognizable logo
The respondents feel easier to recognize the logo of Standard Chartered Bank more than any other multinational banks in Bangladesh. This is especially because of the extensive promotional campaigns carried out by the Standard Chartered Bank in Bangladesh. They try to promote their different products in the financial market in diversified manners which automatically promote their brand image. HSBC comes in second as the most recognizable logo. The logo of Citibank, N.A. Bangladesh is also very popular among the participants as they have lots of community programs directed to the development of the economy of Bangladesh. It would have been more popular if they have been operating consumer banking in Bangladesh.
Recommendation to others
Most of the respondents are satisfied with the services provided by the multinational banks in Bangladesh. They tend to prefer multinational banks over the local banks of Bangladesh due to updated technology, service efficiency and global service network. They would like to recommend their banks to others because they believe that the multinational banks are more cost-effective than local banks. Moreover, they also feel proud to be a client of the multinational banks. Clients of Standard Chartered Bank, HSBC and Citibank, N.A. Bangladesh are very satisfied with the banking facilities and are eager to recommend to others about them.
Conclusion and Recommendation
Summary of the survey
It is very clear from the survey that the Standard Chartered Bank is dominating the market for multinational banks in Bangladesh. This is mainly because of the vast and diversified services they offer to their clients. Moreover they are operating in the Bangladeshi market for a long period of time with huge success.
They have been the pioneer in introducing many new products than any other banks in Bangladesh. HSBC is lacking far behind when compared with the Standard Chartered Bank in terms of market share as well as services offered.
Though being the world’s leading financial institution, Citibank, N.A. Bangladesh is also lacking behind mainly because of the lack of consumer banking in Bangladesh. The other multinational banks such as State Bank of India, Commercial Bank of Ceylon, etc. have not yet gained much popularity in the market as they have started their journey in the Bangladeshi market very recently. People are more aware about the slogans and logo of Standard Chartered Bank than any other bank. Most of them believe that reputation, financial stability, reasonable charges, service attitude of employees, technology adoption, global service network and new product innovation are the main reasons behind selecting any multinational bank in Bangladesh. They also consider that the multinational banks they are using are sufficiently providing these facilities in order to provide the best possible services.
Drawbacks of Citibank, N.A. Bangladesh in creating brand awareness
Citibank is the consumer and corporate banking arm of financial services giant Citigroup, the largest company of its kind in the world. Though being the leading financial institution in the world, Citibank, N.A. Bangladesh does not provide consumer banking in Bangladesh, but still they earn record profits from their limited operations in Bangladesh.
People of Bangladesh are not much aware about the operations of Citibank, N.A. Bangladesh as they are not being served directly by the bank itself. But the bank has always shown strong commitments towards the community by engaging themselves in many community events.
These efforts have led to the development of their brand name in the Bangladeshi economy. There are some specific difficulties for the bank which has prevented them to promote their brand more to the people of Bangladesh. The problems are:
No consumer banking
This can be regarded as the major drawback of the bank. They only have corporate banking in Bangladesh which prevents them to get more close to the mass people. Their major functions include dealing with the corporate clients, international trade, etc. which keeps them away from the mass public. Dealing only with the corporate clients and foreign trade is not helping them to establish a solid rapport with the general people and thus the bank is failing to build a strong brand image in the market.
Lack of promotional efforts
Citibank, N.A. Bangladesh has shown strong commitment to the Bangladesh community by engaging in different types of community issues. They have worked hand in hand with Acid Survivors Foundation, Shakti Foundation for Disadvantaged Women, Bishwo Sahitto Kendro, Liberation War Museum, etc. and very recently promoted microentrepreneurs who have been successful in life by taking microcredit. These promotional activities successfully gained attention of many people, but failed to create a mass impact as many of these efforts did not have any emotional impact. They should engage themselves into such activities that would create more impact on people.
Intense competition
Standard Chartered Bank has taken the largest market share in the banking industry in Bangladesh with their superior services and fabulous products. It will be difficult for any other multinational bank to create a better image than them. Citibank, N.A. Bangladesh will have to face intense competition from Standard Chartered Bank as well as from the other multinational banks in Bangladesh. If they even plan to start consumer banking, it will be tough for them to gain market share as it is already controlled by some major banks in Bangladesh.
Local organizations
The City Bank Limited is a private local bank in Bangladesh whose name somehow resembles with the Citibank, N.A. Bangladesh. This creates confusion in the minds of people whenever they read any news about Citibank in any media. Moreover, to create more puzzlement, there is a local company in Bangladesh naming City Group of Industries whose operations are far more different from that of Citigroup and Citibank.
These local organizations create problems for Citibank, N.A. Bangladesh as people misinterpret their names and may not comprehend the real brand.
Lack of detailed layout of Corporate Affairs Department
The Corporate Affairs Department in Citibank, N.A. Bangladesh is not properly structured. This department is responsible for all sorts of branding activities for the bank as a whole. Currently, only one person is taking care of this department without the help of any permanent employee. It creates more pressure on the manager of this department and sometimes might not perform at the best level due to immense work pressure.
Lack of inter-branch coordination
Many a times it can be seen that the Motijheel branch and the Gulshan branch is not harmonizing properly. Bills raised from Gulshan branch are sent to Motijheel branch for issuance of cheques. Instead of issuing them instantly, there is an unnecessary delay in the procedure. This does not ensure proper services to the clients and vendors as they do not get paid promptly and hence degrades the brand image of the bank.
Recommendations
In order to create more brand awareness among people, Citibank, N.A. Bangladesh should try to develop their branding activities. Some suggestions to improve the brand consciousness among people may include:
Consumer banking
If they introduce consumer banking in Bangladesh, more people will be aware about their brand and will learn about them. This is because consumer banking will help them to reach every part of the financial market and to the mass people with diversified products for their convenience. This will promote their brand name more rapidly than any other means.
More extensive promotional efforts
Citibank, N.A. Bangladesh should engage themselves in more promotional activities that catch the eyes of general people. For example, Grameen Phone has been successful in promoting themselves by sponsoring the national cricket team. Citibank, N.A. Bangladesh should try to promote their brand name in areas where people are more emotionally and mentally involved. They can also go for sponsoring events that are more close to peoples’ hearts like major cricket tournaments, national events like celebrating the Independence Day, etc. They can also organize many debate competitions and quiz competitions with university students to make them more aware about the bank. This sort of competitions involving university students will also help them to recognize potential future employees from the students.
Restructuring of Corporate Affairs Department
This department is particularly very important for any organization as it deals with branding. So if more experts are hired in this department it will help the bankers to divide job responsibilities and improve their performance. There should be more people employed in this department and roles and responsibilities should be categorized which will ensure more efficient branding of the bank.
Gifts to clients
Personal relationship should be build with the big customers/depositors. They can be sent different gift items like calendar, diary etc. on different occasions like Eid, New Year etc.
Improving the layout of the office
The layout of the office is done in an unstructured way. Employees do not have much space to move around. The bank should try to increase the amount of space for their employees by constructing a new floor or hiring a new building. A congested structure does not provide a good image to the customers of the bank and hence affects the image of the bank.
More coordination between branches
It is very important that the Motijheel branch and the Gulshan branch should be working with more coordination. They should be working in a more organized way in order to provide fast and quality services to their clients and vendors in order to provide them with maximum satisfaction. This will ensure a superior brand image of the bank to the people.
