Report on Standard Chartered Bank

 EXECUTIVE SUMMARY

According to the requirements of the internship program, I chose to prepare a report on STANDARD CHARTERED BANK. The objective of this report is to focus on two broad issues. One is to briefly look at Standard Chartered Bank and understand the whole banking process, keeping close attention on their culture. The second objective and the main issues of this report is to briefly discuss about the current customer satisfaction level after increasing some charges and fesses. Standard chartered bank is the leading foreign bank in Bangladesh. The report is based on both primary and secondary research. The secondary research provided the main input for the report. This provided a theoretical basis of the report. The primary research was done to know about the banks working procedures and different segments of banks. Standard Chartered offers the client a comprehensive range of Cash Management services. Whether it is a financial institution, a multi-national corporation or a domestic company, Electronic Banking application has the capability to support full range of Cash Management reporting and transaction initiation needs. It provides the secure, reliable and effective link between the client and client’s accounts anywhere across the Standard Chartered network. Standard Chartered is highly recognized as a leading cash management supplier across the emerging markets. Our Cash Management Services cover local and cross border payments, collections, information management, account services and liquidity management for both corporate and institutional customers. The IBG of Standard Chartered Bank offers a wide variety of products and services to the banks and financial institutions.  It has global links with leading banking institutions and agency arrangements through its network of offices in 40 countries.  The Bank offers a full range of clearing, payment collection and import-export handling services. Standard Chartered bank should do are maintaining the standard during recruiting the employees. An employee bears the brand name so if employees make some thing wrong that will ultimately affect Standard Chartered bank.

Origin of the Report:

Consumer banking is a major source of earning for Standard Chartered Bank.  The principal issue to be considered while giving the facilities to individual consumer or to groups is the opportunity associated with such activities.  Consumer banking opportunity is analyzed through considering a number of factors involved in it.  All financial institutions have their individual way of measuring and managing opportunity to keep it at the highest possible level.

Objective:

The objective of this report is to focus on two broad issues. One is to briefly look at Standard Chartered Bank and understand the whole banking process, keeping close attention on their culture. The second objective and the main issues of this report is as follows-

To briefly discuss about the current customer satisfaction level after increasing some charges and fesses.

Scope:

The report limits its scope to Standard Chartered Bank only.

Limitations:

Customers financial Information and information at the bank is confidential & critical.

Total customer satisfaction level judged by statistical measurement no such financial judgment is used here.

Methodology:

Approach:

Standard chartered bank is the leading foreign bank in Bangladesh. The report is based on both primary and secondary research. The secondary research provided the main input for the report. This provided a theoretical basis of the report. The primary research was done to know about the banks working procedures and different segments of banks.

Primary source:

Primary data was collected form the users of software EBBS. Relationship managers and respective unit heads are interviewed who are using this software to analyze the financial strength of the customers.

Secondary source:

The secondary data has been collected from the different publication and brochures of Standard Chartered Bank. To clarify about different product Internet, different articles published in the journals & magazines are used.

Sample Information:

Sample is collected randomly among daily customers from the Uttara, Banani, Gulshan North branch of Standard Chartered Bank.

Data Collection Method:

For the organization part information has been collected through different published articles, journal, and brochures. Formal questionnaire for data collection is used for better understand of customers current satisfaction level after the charges increased by bank. Basic company Information is collected through informal discussions with Relationship managers & respective Unit heads of SCB.

Data analysis:

In the organization part information is provided in a descriptive manner.In the project part data analysis has been done into two parts. One is the data presentation.The second part is analysis. Statistical analysis of the quantitative data has been done. Based on the survey result I use SPSS software to get the statistical analysis. There I use t test and cross tabulation method to find out the customer satisfaction level on different issues.

PART 1:Organization part

STANDARD CHARTERED BANK: AN OVERVIEW

Standard Chartered Bank (SCB) PLC is an international bank group that is incorporated in the UK with its Headquarters at 1 Alderman buries Square, London. The group operations are mainly concentrated in Asia, Africa and the Middle East and its operation is segmented under six regions: LTK, Europe, Middle East, South Asia, South East Asia and the USA. Globally, the SCB group owns an array of key resources that include:

A network of 600 offices in more than 50 countries

A staff of about 28000 people managing assets worth 47.65 billion

At the global level, SCB operates with some key strategies that are quite unique to other banks such as:

To build and grow strong businesses in Middle East, South Asia and

Far East Asia:

Capitalize on the good track record created by its more than 150 years of operations in these regions by building unique position and image among the target  customer segment and being responsive the needs and serve the needs better than the competitors.

HISTORY OF STANDARD CHARTERED BANK IN BRIEF:

SCB has a history of more than 150 years. The name “Standard” stems from the two original banks from which it was founded-“Chartered Bank” of India, Australia and China and “Standard Bank” of British South Africa.

Chartered bank was established in 1853 by a Royal Charter granted by Queen Victoria of England. The main person behind the Chartered Bank was a Scot, James Wilson who had also started “The Economist” still one of the most eminent publications today. He foresaw the advantages of financing the growing trade links with the areas in the East, where no other financial institution was present that time widely.

Expansion in Africa and Asia:

The Standard Bank opened for business in Port Elizabeth, South Africa, in 1863. It pursued a policy of expansion and soon amalgamated with several other banks including the Commercial Bank of Port Elizabeth, the Coles berg Bank, the British Kaffarian Bank and the Fauresmith Bank. The Standard Bank was prominent in the financing and development of the diamond fields of Kimberly in 1867 and later extended its network further north to the new town of Johannesburg when gold was discovered there in 1885. Over time, half the output of the second largest goldfield in the world passed through the Standard Bank on its way to London.

The Impact of War:

Even the First World War offered opportunities for expansion when the Standard Bank set up a branch in Tanzania shortly after British troops occupied the formerly German administered Dares Salaam in September 1916. Both banks survived the inter-war years but the world trade slump led to the closure of operations in the Canary Islands, Liberia, the Netherlands, and Equatorial Guinea. Disaster struck the Chartered Bank’s office in Yokohama, Japan, when it was destroyed by an earthquake in 1923 killing a number of staff. The Chartered Bank was particularly affected by the Second World War when numerous Asian countries were occupied by Japan.

The Post War Years:

After the Second World War many countries in Asia and Africa gained their independence. This led to local incorporation in some countries, particularly in Africa. Other operations such as those in Iraq, Angola, Myanmar and Libya were nationalized, while in Indonesia the Jakarta office was destroyed in an attempted coup d’etat. In 1948 the Chartered Bank opened in Bangladesh and during 1957 it acquired the Eastern Bank. The Eastern Bank gave the Chartered Bank a network of branches including Aden, Bahrain, Beirut, Cyprus, Lebanon, Qatar and the United Arab Emirates. The Chartered Bank also entered into a joint venture to form the Irano-British Bank which opened for business in 1959. The bank grew rapidly and had 24 branches when it was nationalized in 1981. s radically changed and strengthened.

Standard Chartered in the 1990s:

Even within this period of apparent retrenchment Standard Chartered expanded its network, re-opening in Vietnam in 1990, Cambodia and Iran in 1992, Tanzania in 1993 and Myanmar in 1995. With the opening of branches in Macau and Taiwan in 1983 and 1985 plus a representative office in Laos (1996), Standard Chartered now has an office in every country in the Asia Pacific Region with the exception of North Korea. In 1998 Standard Chartered concluded the purchase of a controlling interest in Banco Exterior de Los Andes (Extebandes), an Andean Region bank involved primarily in trade finance.

Standard Chartered in Middle East & South Asia (MESA):

The MESA region performed well in year 2002. The region accounts for approximately eleven percent of the group’s revenues.

The integration of Grindlays was successfully completed and the group is now one of the leading international banks in each of its chosen markets in the region. The contribution of the Group’s business in the United Arab Emirates reflects the businesses. Standard Chartered now holds leadership positions in most of its key product segments in the UAE. The average number of employees in the Middle East and other South Asia region in 2002 was 2995.

Standard Chartered in Hong Kong:

Hong Kong remains the Group’s largest market, generating one third of the Group’s revenue. They have a network of 74 branches. Standard Chartered has been transacting business in Hong Kong since 1858 and they issue bank notes there. In 2002, Standard Chartered became the first FTSE 100 Company to launch a new dual primary listing in Hong Kong. This will make the Group more accessible to Asian investors and will enhance the Group’s regional profile. The average number of employees in Hong Kong in 2002 was 4,677.         

Standard Chartered in Singapore:

Standard Chartered has been doing business in Singapore for 144 years and has 20 branches and offices, the largest branch network among foreign banks. The business in Singapore accounts for approximately eleven percent of the Group’s revenues. Standard Chartered has Qualifying Full Bank Status, which has enabled expansion of the distribution network. In 2002, Asian banker magazine named Standard Chartered the ‘Best Retail Bank in Singapore’. The average number of employees in Singapore in 2002 was 2,451.

Standard Chartered in Malaysia:

Standard Chartered is the oldest bank in Malaysia, where there is a network of 29 branches. Malaysia is another of the group’s core markets with broadly based business as a result of long established franchises. The group continues to expand its Shared Service Center that was opened in 2001 and carries out operations and processing activity. The Centre in Kuala Lumpur has contributed significantly to improvements in the Group’s processing and service efficiency.

Standard Chartered in other Asia Pacific:

The group has more than 80 branches and 14 offices in 14 countries across the region. In China, Standard Chartered has one of the largest branch networks of any foreign bank and is well positioned for growth and opportunities. The group is developing its Consumer Banking business and has opened branches in Shanghai and Shenzhen. In Thailand, the integration of Nakornthon Bank was successfully completed in 2002.The average number of employees in other Asia Pacific in 2002 is 4851.

Standard Chartered in India Region:

Standard Chartered is the largest international bank in India and, following successful completion of the integration of Grindlays, have a combined customer base of 2.4 million in Consumer Banking and over 1200 corporate customers in Wholesale Banking. The group launched its business in Mauritius in 2002 to provide Wholesale Banking services to corporate client’s .The shared service centre in Chennai continues to develop rapidly as more services and processes are migrated from other countries. The average number of employees in the India region in 2002 was 5251.

Standard Chartered in Africa:

Standard Chartered continues to be one of the leading banks in sub Saharan Africa. The group offers consumer banking and wholesale banking services in 13 African countries with a network of 149 branches and offices. Standard Chartered recently launched operations in the Ivory Coast and re-entered Nigeria. Business in East Africa has performed well. Despite difficulties in Zimbabwe, the group’s business in Africa has delivered good results. The average number of employees in 2002 was 5009.

Standard Chartered in United Kingdom and the Americas:

Businesses in the United Kingdom and the Americas provide services to leading multinationals and major financial institutions, which trade or invest in Asia, Africa, the Middle East and Latin America. In 2003, the businesses in the Americans were extensively restructured to improve efficiency for future growth. The Group also operates a growing off shore banking business based in Jersey. The average number of employee in the United Kingdom and Americas in 2002 was 2098.

The Acquisition of ANZ Grindlays by Standard Chartered:

The main idea behind acquisition and merger is making an investment and usually involves more than mere cash. When two separate legal entities merge every organization aspect of both companies are expected to change be it internal or external. Such management decision is taken for a variety of reasons but the ultimate aim is to add up to shareholder’s wealth. For banks operating in the consumer and wholesale banking sector, earning depends largely on the interest margin as well as the service charges.

Standard Chartered Bank in Bangladesh:

The Chartered Bank started operating in Bangladesh in 1948, opening a branch in Chittagong.  The branch was opened mainly to facilitate the post-war reestablishment and expansion of South and Southeast Asia.  The Chartered Bank opened another branch in Dhaka in 1966, where it is still headquartered. After the merger of the Chartered Bank with the Standard Bank in 1969, the Standard Chartered Bank took up a program of expansion.  It increasingly invested in people; technology and premises as its business grew in relation to the country’s economy.  In 1993, there was an organizational re-structuring, which led to a substantial expansion of the Bank’s business.  Today the bank has in total four branches in Dhaka apart from the Chittagong branch, including an offshore branch at the Savar Export Processing Zone.

The Organization Structure:

The Standard Chartered Bank in Bangladesh has its headquarters and twenty one branches across the country. While the full range of services is available at the headquarters, other branches offer specific services appropriate for the location.  At the headquarters, the bank mainly consists of two divisions:

1.     Business

2.     Support

The business division has the following departments:v Corporate Banking Group (CBG)v Global Markets (GM)

Institutional Banking Group (IBG)

Consumer Banking (CB)

Custodial Services (CUS)

The Support division provides assistance to the above business activities and consists following departments:

• Operations
• Finance, Administration and Risk Management
• Information Technology Center
• Human Resource Department
• Legal and Compliance
• External Affairs
• Credit

All the staff members of Standard Chartered Bank belong to an internal trade union known as “Standard Chartered Bank Employees Union” the clauses of which are reviewed and agreed upon every two years.

 Chain of Command:

Chartered Bank in Bangladesh follows a hierarchical pattern of command. The Chief Executive Officer (CEO), David M. Fletcher reports to the Regional General Manager, MESA in Dubai.  All the department heads at the headquarters report to the CEO. In Chittagong, however, since there are two major business activities, a manager or senior manager, who reports directly to the head of the respective division in Dhaka, heads each. The Custodial Service division at the headquarters reports to the Head of Corporate Banking.

Chief Executive Officer’s Office:

Standard Chartered as well as Standard Chartered Bank in Bangladesh is headed by the Chief Executive Officer, who reports to the office of the Regional General Manager, Middle East and South Asia (MESA). While performing staff functions, the CEO is assisted by different heads whose functions are mentioned in the following section.

Head of Finance and Administration, who looks after the general ledger, budget, financial scenario of the bank, risk management administration and audit operation.

Head of Cards who supervises credit card operation.

Head of Consumer Banking, who supervises retail-banking operation like sales and services, retail lending, product development and product marketing.

Head of Corporate deals with the relationship management, corporate finance etc.

Head of Human Resources looks after succession planning, training and industrial matters.

Head of Lending Management assists the management division of Corporate, retail and Credit Cards in their lending operations.

Head of Global Markets deals with the foreign exchange, money market and asset liability operation.

Head of International Services deals with the trade finance, guarantee and correspondent banking.

Head of Operations looks after the support services in banking lending, CBS User, Treasury, SWIFT/TELEX operation etc. Head of Technology is directly accountable to him.

Management:

The goal of Standard Chartered Bank is to be the “Bankers of First Choice.” Towards that goal, the overall planning in the Organization is done at the headquarters level in Dhaka by a Management Committee (MANCO), headed by the CEO and consisting of the business heads of Corporate Banking, Consumer Banking, Treasury, and from the support divisions the heads of Human Resource, Operations and Finance Departments.  They meet once a month, or when a special situation arises, to plan the strategic decisions. The decision making, although apparently based on a top-down approach, leaves room for participation down to the level of department heads, which are responsible for carrying out the planning of their department within the broad guidelines set by MANCO.

 Among the broad strategic objectives are:

Creating a congenial work environment

Modernization of the Management Information System to achieve full automation by drastically cutting down paper work in the long run.

Focusing on service quality and consumer needs.

Recruiting and maintaining top-grade, efficient employees.

To invest in those technological systems which will upgrade and enhance financial services, and

Creating an excellent brand image of the Bank.

 Activities of Standard Chartered Bank

 Corporate Banking Group

Standard Chartered Bank offers its local customers a wide variety of financial services. All the accounts of corporate clients, which mainly comprise the top local and multinational companies operating in Bangladesh, are assigned a Relationship manager who maintains regular and close contact to cater to their needs. The wide variety of lending needs are catered to with skilled and responsive attention

Project finance and investment consultancy

Syndicated loans

Bonds and Guarantees

Local and International Treasury products

The trade finance of Standard Chartered Bank takes care of the commercial activity related issues, particularly those related to import and export finance services.  Some of the services are:

Trade finance facilities including counseling, confirming export L/Cs and issuing of import L/Cs, backed by its nternational branch and correspondent loan network

Bond and Guarantees

Project finance opportunities for import substitution and export oriented project

 Global Markets

Institutional Banking Group:

The IBG of Standard Chartered Bank offers a wide variety of products and services to the banks and financial institutions.  It has global links with leading banking institutions and agency arrangements through its network of offices in 40 countries.  The Bank offers a full range of clearing, payment collection and import-export handling services.  The bank offers foreign missions, voluntary organizations, consultants, airlines, shipping lines, and their personnel the following financial services:

Current accounts in both Taka and other major foreign currencies

Convertible Taka accounts (these funds are freely convertible to major international currencies)

Local and foreign currency remittances etc.

 Consumer Banking

Superior retail banking services comprising a wide range of deposit and loan products are offered by the Standard Chartered Bank to its individual customers.  The Consumer Banking division constantly faces challenges and meets them by developing new products and services to fulfill the specific requirements of local TU Bank offers a 24-hour service in Bangladesh through its Moneylink ATM network and Phone-link Phone Banking services.

Products and Services of the Bank:

Standard Chartered Bank has highly qualified professional staff members who have the capability to manage and meet all the requirements of the bank.  Every account is assigned to an Account Manager who personally takes care of it and is available for discussion and inquiries, whether one writes, telephones or calls.  The services of the Bank are personalized and backed by advanced computerization.

The following paragraphs illustrate the essential products and services of the Bank:

The Corporate Banking Group

Cash management:

Standard Chartered is highly recognized as a leading cash management supplier across the emerging markets. Our Cash Management Services cover local and cross border payments, collections, information management, account services and liquidity management for both corporate and institutional customers.

Features:

Manage the availability of client’s funds efficiently

Monitor and control the movement of funds

Settle payments to client’s suppliers in a timely and cost-effective manner.

Capture every investment opportunity to increase your income

Trade finance:

Standard Chartered possesses 140 years of experience in Trade Finance. The bank has presence in over 40 countries, in addition to our extensive network of overseas banking partners and correspondents. The bank obtained ISO9002 accreditation for its quality service. Dedicated trade and payment systems are in place to make sure that your every transaction, even across different currencies, will be professionally executed.

Custody and clearing services:

Standard Chartered Custody and Clearing Services’ combination of local market expertise, with the security offered by being an integral part of one of the world’s leading international banks has garnered an impressive client base which includes leading North American, European and Asian institutions.

Electronic banking:

Standard Chartered offers the client a comprehensive range of Cash Management services. Whether it is a financial institution, a multi-national corporation or a domestic company, Electronic Banking application has the capability to support full range of Cash Management reporting and transaction initiation needs. It provides the secure, reliable and effective link between the client and client’s accounts anywhere across the Standard Chartered network.

Lending:

Working Capital Loan to help the client meet their financial obligations and operate effectively, the bank offers assistance in the form of working capital loans, overdrafts, term loans (including real estate loans and other secured debt), backstops and revolvers.

Global markets:

According to the latest ‘Activities of Bank and Financial Institutions’ published by the Banking Division of the Ministry of Finance of Bangladesh, Global Markets, Bangladesh is, in terms of foreign exchange transactions, first amongst the multinational banks and 4^th amongst all the banks in Bangladesh.

The Treasury division of the Standard Chartered Bank has a centralized dealing room in Dhaka and consists of the following two areas:

Structured finance:

Standard Chartered provides Commodity, Structured Trade and Export Finance global group (“Structured Finance”) service. Many financial institutions have been retreating from these markets. Standard Chartered stands out as the only bank which is committed to financing Commodity and Export Credit Agency supported trade flows.

 Features:

Access to long established expertise in Commodity Finance and willingness to accept the credit risks associated with approved counterparties.

Access to structuring skills for emerging markets medium term financing and to country limit availability for many countries in Asia, India, Middle East, Africa and Latin America.

Presence on the ground in many emerging markets which facilitates transactions through local knowledge and the provision of local commercial banking infrastructure.

Track record and capability for global arranging, underwriting and syndication in the whole area of Structured Finance.

Two types of lending facility are provided to client at present:

Loan Structure and Syndication: this facility helps borrowers to meet substantial financing needs by enabling them to reach the banks most interested in lending to their particular industry, geographic location and structure through syndicated debt offerings.

Foreign Exchange:

The Reuters monitors placed in the Treasury Division give continuous updates on exchange rate movements as well as ready access to market information. The Foreign Exchange service includes:

Foreign exchange contracts for the same day value, next day value or spot transactions

Forward Contracts: Foreign exchange contracts to hedge exchange risks.

Cross Currency Contracts: The customers can trade a wide range of currencies.

Information analysis: The Treasury division publishes daily and weekly currency newsletters, which provide analyses of currency trends and related issues.  Seminars and workshops are conducted for customers from time to time on foreign exchange related topics.  Customers can also have access to the bank’s information database round the clock through Phone banking.

Money Markets and Investment:

Standard Chartered Bank’s Treasury division is the local market leader in debt instruments including both short and long-term fund mismatches through the money market and takes front line position in inter-bank and market developments.  The money market is managed through tools like inter-bank call money rate, government T-bills of various maturities and inter-bank SWAPS. In future, new instruments like repo and reverse repo will be introduced which will add to the depth of the money market. Equipments like telephone, voice recorder, money 2000, telex, sealing system, time keeper, swipe doors, computers, fax internet are used to ease and fasten operations of the dealers to conduct deals.

Institutional Banking Group (IBG):

It assists the local banks by taking care of their cross-border business through the worldwide Standard Chartered Bank network.  Following are the variety of financial products offered by this department:

Vostro Accounts:

IBG, Bangladesh maintains Vostro Accounts of banking and financial institutions worldwide. Customers maintaining such accounts can remit funds throughout the country through the Standard Chartered Bank branch network as well as through – Chartered Bank’s local correspondent relationships.

Nostro Accounts:

In order to increase and promote the correspondent banking business worldwide, IBG operates Nostro accounts to Bangladeshi banks and financial institutions in almost all branches spanning the Standard Chartered Bank global network.  Group branches and subsidiaries provide full clearing and payment services in the UK, USA, Hong Kong, Malaysia, Singapore and many African countries.  Worldwide payments services are facilitated by a network of branches supported by electronic cash management (available in select locations), fund transfer system and membership of SWIFT.

Handling of Trade Finance Business:

IBG offers the full range of services available under Trade Finance to its customers.  The Standard Chartered Bank network in China, the Far East, the Middle East, the Indian sub-continent, Africa, UK and USA makes SCB the natural choice of correspondents for advising, confirming, and negotiating their letters of credit in these territories.

Retail Banking:

Retail Banking deals with the banking services to individuals. It includes the following products and services of the bank:

Current account:

Tailored to meet the needs of individual and commercial customers, SCB’s current account offers benefits like free cheque book, ATM service, Phone banking, account access from any branch, and instant fund-transfer (free of charge) amongst our branches in the country. Minimum opening balance required is Tk. 50,000.

Recent changes:

 A fee of BDT 1150 is deducted after every 12 months as a relationship fee irrespective of balance

Savings account:

It is an assortment of best benefits available in the market, offering a wide range of special treats free of cost to our retail customers. The most attractive treat is the competitive tiered interest rates, which ensures higher returns for larger deposits. Anyone looking for an opportunity to build a sound saving base can avail our Savings account, which includes the following benefits:

Free cheque-book, Debit card and phone-banking service

Account access from all our branches in Bangladesh

Opportunity to apply for – safe deposit locker facility, utility payment service through ATM and any of our personal finance products.

 Interests of deposited amount are as follows:

Deposited Amount                                              Interest rate

Under BDT 1,00,000                                                    0%

Between BDT 1,00,000 and 10,00,000                        2.5%

Over BDT 1000000                                                      3%

Interest forfeiture rules (introduced in March 2006)

Minimum balance must be BDT 1,00,000 every day

Can’t withdraw more than 10% of Deposit amount or BDT 25000 whichever is less without 7 days’ notice.

Maximum 2 transactions allowed per week.

Fixed deposit:

Ideal product for nesting surplus deposit for future long-term investment. SCB’s Fixed deposit, known for its high-yield, helps the customer earn the maximum possible return in addition to the following features:

Can be opened for a term of 3 months, 6 months or 12 months

Tiered interest rates, offering higher rates for larger amounts

Interest payable on maturity

Automatically renewable (with or without interest)

Can be used as security against personal/ commercial loans

Recent changes:

From March 2004, Fixed Deposits having tenures of two years, three years, four years, five years are being offered.

Call deposit:

An easy way to turn short-term savings into high-yield assets, blending of the flexibility of a current account with the yield of a fixed deposit. Other features include:

Interest rate is between 3 to 5%

Interest will accrue everyday.

No withdrawal restriction irrespective of frequency or size subject to seven day’s notification.

Minimum balance requirements is BDT 250000

Interest will be forfeited the day balance goes below BDT 250000

Residents Foreign Currency Deposit (RFCD):

Specially designed foreign currency account for resident Bangladeshis. Offers wonderful opportunity to build a deposit base in foreign currency. Helps make payment for overseas commitments and dues like credit card bills, traveling expense etc.

Main features:

Offered in USD, GBP and Yen

Competitive Interest on deposit

Can only be opened within 6 months of arrival from abroad

Deposit can be made in foreign currency only (cash, TC or Drafts)

Cash withdrawal in local currency only

Fund Remittance (in both Lcy and Fcy) to any place in and out of the country (without restriction)

Recent changes: RFCD account is being offered in Euro from 2004.

Foreign currency current account:

Applicable to Bangladeshis working abroad, it can be opened in USD, GBP and Yen without restriction on transaction frequency. Can be operated through nominees in absence of the accountholder. Fund remains in foreign currency and is freely remittable.

Main features:

Deposit can be made in foreign currency only (cash, TC or Drafts or transfer from other FCY account).

Cash withdrawal from the account is in local currency only.

Fund Remittance (in both LCY and FCY) to any place in and out of the country (without restriction).

Fund can be used to make investment in Wage Earners’ Development Bond.

 Non- resident foreign currency deposit:

A short-term foreign currency deposit account suitable for Bangladeshis living abroad, offering most competitive interest rates available in both local and international markets. Other features include:

Interest paid in Foreign currency

Can be opened for a term of 1 month, 3 months, 6 months or 12 months

Interest rates are tiered (based on amount and term)

Cash line:

This product permits ready access to cash without disrupting interest-earnings on fixed investments. It provides ready access to cash against quasi-cash investment papers like Terms deposits (Lcy / Fcy) Savings Certificates, Wage Earners’ Development bonds, ICB units certificates etc.).

Other features:

Both Revolving & terminating options

High utilization Limit (based on security value)

Quarterly payment of Interest (only on the outstanding amount)

Money builder:

A unique savings plan that helps customer builds up a sizeable savings base over a period of 5 years. One can begin to save with a small amount, add affordable monthly installments for 5 years and get an amazing return on maturity.

Personal loan:

An easy and fast loan product that requires minimum documentation no cash security, no down payment and minimum processing time.

Main features:

Available for any personal reasons ranging from purchase of consumer durable educational expenses to medical treatment.

3 different repayment-tenor options – 12, 24 or 36 equal monthly installments.

Can be secured by salary assignment and employer’s undertaking or personal guarantee.

Can be repaid in advance, anytime ahead of maturity date

 Special Interest Rate for corporate Client:

Phone link:

Phone link in Bangladesh was inaugurated in March 1997.  It helps to bring banking within the dialing distance of the customers, providing access to account information and details, 24 hours a day from the privacy and comfort of their homes, offices and cars. Phone link service is offered to all customers free of charge.

The Phone link service includes:

Automated Services:

Account-related services

Foreign currency related information

Change of Telephone Identification Number (TIN)

Through the Phone bankers one can avail the following services:

Enquiry on the product services

Change of account address

Notification to the bank of lost or captured Moneylink ATM Cards

Stop Cheque instruction

Pay Order / Demand Draft preparation (to be collected later by the customer) Status enquiry on remittance

Moneylink:

Standard Chartered Bank launched Moneylink ATM in 1994, the first bank to offer this service in Bangladesh. Moneylink ATM service is free of charge, offering the following features:

• Cash Withdrawal & deposit
• Cheque deposit
• Cheque book request
• Change of PIN
• Printing of mini-statement
• Payment of utility bills.

Safe deposit locker:

Standard Chartered Bank’s safe deposit locker service offered from Dhanmondi and Sylhet branch gives you a modern facility for safekeeping of precious items, confidential documents and other valuables. Other features:

Personalized service from a dedicated locker officer

Available to any customers (for an annual fee which depends on locker size)

Accessibility anytime during the banking hours

No additional charge for locker visit during locker hours.

Priority banking:

Standard Chartered Bank Bangladesh offers Priority Banking, a special service package for our valued customers. Under this segment an exclusive combination of services are offered to customers who signed up for it. Some of the benefits offered under the program are:

A Priority Card that recognizes client’s Priority Status at all our local branches and also at our global Priority Centers

• Higher withdrawal limit per day from all ATMs in Dhaka, Chittagong & Sylhet
• Privileges associated with the Priority card in reputed hotels, restaurants and stores locally and globally.
• Exclusive Priority Centre in Dhanmondi & Sylhet with reserved parking space.
• Dedicated Customer Relationship Personnel at the Priority Centres.
• And also commission free SCB Visa travelers’ cheques against travel quota, swifter transactions, pre-arranged banking services and invitation to special social and cultural events.
• All one need to do is to meet the priority criteria (set in terms of deposit value), and sign up the relevant forms and the client will immediately be eligible for all the benefits
• In summary, some of the basic products and services offered by the Personal Banking division are: Current Accounts, Overdraft on Current Accounts, Foreign Currency
• Term Deposits, Local Currency Cash Cheques, Cheque Purchase, Drafts, Savings Accounts, Term Deposits, Telegraphic Transfers, Traveler’s Cheques, and Personal Loans.

Account Statement Charges:

The charge for holding statements is BDT 1150 per annum per account, and for Additional/ Duplicate statement (Per cycle) is BDT 575 per statement. Photocopy of statements is Taka 1150.

ATM Card Charges:     

The annual fees for ATM card are Taka 690 per card, and the charge in case of damaged or lost card is Taka 600 per card. And phone banking and internet banking and evening banking is absolutely free.

Charges for Cash and Travelers Cheque Foreign Currency:

For issuance of FCY cash, customers need to pay 1% of the transaction plus Taka 200/= per passport. And for issuance of Travelers cheque 1% of the transaction plus Taka 200/=. The charge for encashment is absolutely free in case of travelers cheque issued by SCB.And encashment for other bank’s issued T.C is 0.25% of the transaction value or minimum BDT 500. SCB also provides encashment facility for non-customers, is 0.25% of the transaction value or Taka 1,000.       

Charges for maintaining Student file:

For customers, opening student file for SAARC countries, they charge BDT 3500 per student, per annum plus Taka 500 per remittance. This is a centralized system. No matter where the customers conduct his/her banking, for opening and maintaining student file, he/she is bound to come to SCB Kakrail Branch, which is at 109, Kakrail. That branch exclusively deals with Student File. And, the charge for other countries is Taka 5000 per student file plus Taka 500 per remittance. This opening of student file is not available for non-customers.

Two separate divisions of SCB in Bangladesh:

Product Division: There are different divisions for targeting different type of customers. Mainly consist of two divisions, that is Consumer Banking Division (C B) and other is Corporate Banking Division named Corporate and Institutional Banking (C & I).

Consumer banking division meets the needs of individual customers with various products like Savings Account, Extra Value Savings Account, Access Account, Call Deposit, FCY Deposit, NFCD Fixed Deposits, RFCD Account, Personal Loans, Auto Loans, Flexi loans, Cash Line, Installment loans, etc. This department also deals with other savings instruments like education savings scheme, rainy day scheme, marriage day scheme, millionaire scheme (some printed brochures are enclosed in the Appendix).

This focus allows the business to develop an in-depth understanding of the banks customer’s evolving requirements. This in turn enables SCB.

to develop the products and services that help them to stand out from the competition. Treasury provides support to the customers of both these business and develops customers (both individual and organizational) of its own.

Part 2

(Statistical data presentation and Analysis)

1) Please identify your gender

Analysis: Here from the survey I found that among 120 survey 33% are women and 67% are men. So we can come to the conclusion that most the SCBS customers are male. And many case we found that private service holders wife maintain there account that’s why the percentage move to 33% otherwise it can be less than 20%. Most of these cases we found those males are opening a joint account so that there wife can maintain there account.

2) Please identify your age range

Analysis: In my survey questionnaire I gave 7 age segment and found 25% customer among the 120 fall in between 31-35 years then 22% fall in 41-45 age years old and 20% fall in between 36-40 years age. So we can say that most of the SCBs customers’ age range falls between 31-45 years range. But yet there are many customer whose age range fall above the average because they maintaining the account before the Independence of Bangladesh. At the same time we found some new customers who are student after SCB start the graduate account. So we can say that all aged customer hold account in SCB Bangladesh.

3) Please mention Your Residence Location

Analysis: I basically did my survey in Uttara, Gulshan, and Banani branch so most of the people are from these areas but in Uttara I found some people coming from Tongi as there is no branch in Gazipur and SCB has a corporate client Sanofiaventis in tongi so employees of sanofiaventis came to uttara and found some customer from Khilkhet and Nikunja. In banana and Gulshan I found many flowing customer from different place of Dhaka city like Agargaon, Dhanmondi and old town. But highest cluster is found on the basic three areas.

4) Please mention your monthly Family income range.

Analysis : Standard Chartered bank is a place where customer or consumer requires a huge amount of money to start its initial operation with SCB. So it is not mentionable mostly high income holders have account in SCB. Among 120 50% we found have monthly family income more than 45000 and 37.5% have income in between 35001-45000. Highest numbers of people are fall in between this.

5) Please mention Your Educational Background.

Analysis: In my survey I found highest number of consumer educational back ground is Honors and all of them except some old women and some worker from Sanofiaventis are graduate means 69.2%. Second is 20.8% are master degree holder and 6.9% are PhD degree holder. So we can end up that all most 85% of SCB account holders are educated because most of the case they need to fill up form in English.

 6) Please mention your profession

Analysis: Here we can see that highest percentage is on private service holder because they are operating there salary account with SCB for better service and for definite benefit. Next is professional under this category all engineer, doctor, lawyer, Consultant etc which contains 18.3%. Then next government officer as we know a huge number of our population is doing govt. service but most of their money is black money that’s why they don’t want to operate in SCB although we found 13.3% are govt. service holder but most of them are senior official. Last we found same percentage on student and retired govt. official which is 3.3%.

7) Please put a tick mark on the service name that you avail most from Standard Chartered bank.

Analysis: During my internship in Uttara branch and from the survey I found most of the customers come to branch for avail the sanchayapatra coupon encashment and purchase services and taking statement & certificate for different embassy. And numbers of people come to know there balance although they can get it through ATM booth and call center but still they wants to rely on branch. Lastly few people as well come to open different savings product.

8) Are you happy with the charges that Standard chartered bank take for statement from branch?

Analysis: Standard Chartered recently increase their charges for statement and certificate if customer wants to get them from branch. They increase it almost double where in the past it was 287.5 for 6 months not it is 575 for the same tenure and 1150 for 1 year. Which makes many customers annoyed that’s why I found among 120 people 99.2% are unhappy with this recent charge.

9) How much do you think Standard Chartered Bank should charge for statement from branch?

Analysis: Here I want the customers suggestion regarding how much SCB should charge for the statement & certificate 41.7% say they can increase but the amount shouldn’t be 350+vat, 35% said same as before. So their suggestion is SCB can increase the charges but not doubled. Where as 14% said SCB should reduce the charge to 150+vat and 9% said they can charge at best 450+vat but not the double.

10) Are you glad to take Debit card as a replacement of ATM card by paying more?

Analysis: Standard Chartered start distributed its debit card as they want to replace ATM card with debit card. But problem is charge is more or less double at the same time SCB start charge customers before they start use the debit card and SCB send the debit card by post without taking permission from customer. Here 76% said they are not happy to take Debit card by paying more and 24% said they are happy.

11) How much do you think Standard chartered bank should charge yearly for debit card to retain the satisfaction?

 Analysis: Here I ask them how much SCB should charge for the debit card 73% said they should charge same as ATM card and 23% said below the ATM card charge.

12) Do you think Standard chartered banks required document for any kind of service to the client creates dissatisfaction level among customer?

Analysis: Now if any customer wants to take any kind of services they need to present with different papers like passport for photo identification or authorization application with attested photo. But these docs increase dissatisfaction level among valued customer. That’s why 44.2% said they agree that it increase the dissatisfaction level and 29.2% said strongly agree with this statement.

                    2) Loan Closing Charge

                   3) Account Closing Charge

                   4) Loan Processing Charge

                   5) Account Opening amount (2 Lac for Savings, 50 thousand For Current)

                  6) Statement request

                 7)Balance Check

                8)Different Charges of different Products

Analysis: Standard Chartered bank is the first bank in Bangladesh who start the call center option in Bangladesh. Now they are start creating their call center activated. For this reason they try to make the customer call center oriented instead of branch oriented. SCB make many things free for customer if they collect through call center. But many problems associated with call center performance. The main problem which is the basic criteria of the call center is availability of phone line. The phone line is very much poor, sometimes branch employee can not connect the phone line when branch people suggest them about then they directly ask can you please connect the no. and branch guys fail to connect. But over all whenever customers make complain or want something from call center they will get that very soon. That’s why customers are annoyed with availability of phone line not with services.

9) How do you value Standard Chartered Banks performance in terms of the following features & services? (Please choose among 1 to 5, as 1=Excellent, 2=Good, 3=Ok, 4=Poor and 5=Very poor)

Here I ask some basic question from where I found some important information about SCBs basic performance. The questions are as follows:

          1) Service delivery time

Analysis: In branch mostly service given by Customer Service officer means (Cash) and Personal Financial Consultant (PFC) but the service delivery time is very poor. In cash for giving service to particular one customer one CSO take 5 minutes just to receive and giving the money and abut PFC they basically harass the customer by asking many question even from the account holder they ask many question if sign mismatch occur. So that’s why service delivery time comes poor and 61% of the people said very poor and 21% said poor means 82% said poor.

2) Behavior of the bank staff

Analysis: Standard Chartered bank is the largest multinational bank in Bangladesh and all their employees are as well employee of SCB London so customers expectation is very high but most of time I found SCB put the sales officer who are just B com pass as CSO and this creates problem because they don’t know curtsey and bank never arrange and behavior change training for them. That’s why 42% of the 120 people said behavior is poor and 32.5% said very poor.

3)Interest rates of the products and services

Analysis: Standard chartered banks product has the lowest interest rates in the market and they don’t care they don’t even have any plan to increase the rates. That’s why 45% survey people said interest rates are very poor and 34% said poor. And this is the only reason why post of the people uses their deposit in Govt. Sanchayapatra which has highest interest rates.

4)Required documents for different service ( Example: Passport or Photo Identity for all service)

Analysis: For security purpose and for Bangladesh Banks requirement SCB want many documents for different services. But people said its not bad because these days every one is fear about terrorism. That’s why 72% said requires docs is ok.

5)ATM booth Service

Analysis : SCB first introduce ATM booth service in Bangladesh now they have 35 ATM booth but problem is all of them are becomes old and there are no particular department for ATM branch people needs to repair them that’s why service quality degraded day by day. Only for this degraded services 53% said services are very poor and 18.3% said poor. But within 6 months this scenario will change as SCB is going to start new ATM booth department who are going to take care all of them and a special services will become standby so that anytime they can solve the problem.

6) Image of the brand name

 Analysis: As a multinational bank SCB has highest number of 24 branches and 35 ATM booths and they are only bank in Bangladesh who are connected online for all these branches and ATM. That’s why there is no question about the brand name. That’s why most of the people said the brand name is excellent and good.

Correlation:

Cross Tabulation 1:

• Standard chartered banks call center performance for cheque book request
• Standard chartered banks performance in terms of service delivery time

H₀ : There is no association.

H_a : There is association.

Here we see that Chi-square _calculated = 27.77305

In 95% interval and 16degrees of freedom Chi-square _critical = 30.195

So, Chi-square _{calculated <} Chi-square _critical

So, Hypothesis is accepted.

Analysis: Means Cheque Book delivery time is highly related with SCBs performance in terms of service delivery time. As cheque book delivery is one of the major job responsibilities of branch and it requires time and if customers make it through call center it will help branch to deliver them as quickly possible.

Cross Tabulation 2

Standard chartered banks call center performance for statement request

Standard chartered banks performance in terms of service delivery time

H₀ : There is no association.

H_a : There is association.

Cross Tabulation 3

• Standard chartered banks performance in terms of ATM booth service
• Standard chartered banks performance in terms of service delivery time

H₀ : There is no association.

H_a : There is association.

Findings and Recommendations:

Consumer banking is number one profitable sector in Bangladesh. While it has solid revenue potential it involves close cooperation and coordination among several departments within the bank and liaison with a large number of entities.

The following aspect should be taken under consideration to increase the customer satisfaction which ultimately help SCB to be profitable:

First things that Standard Chartered bank should do are maintaining the standard during recruiting the employees. An employee bears the brand name so if employees make some thing wrong that will ultimately affect Standard Chartered bank. And consumer banking directly deals with customer and they face the major problem of loosing customer if employees make something wrong.

Second thing is Standard Chartered bank should create a new division whose major responsibility will be looking after the ATM booths. These days people are interested to make their banking transaction through ATM but due to some technical problem most of the time they face problem in ATM. So new division can solve this problem by solving the technical problem right on time and make servicing of machine regularly.

From my survey most of the client or customer these days needs to come to the bank for Sanchayapatra coupon encashment. Here for better customer service Standard Chartered bank should introduce new software where customer can drop their Sanchayapatra and all the coupon will be en cashed automatically after maturity. This will increase the brands power on the mind of the customer.

Prevailing legal procedures is very lengthy and complicated. It takes longer period to settle any kind of dispute. On the other hand, encashment of security after maturity is a long drawn process, i.e. generally takes 5 – 6 days. So, SCB should be more careful in the case of opening and closing different securities. So that after maturity customer gets them very quickly and timely.

 Conclusion:

In retrospect of the marvelous growth of consumer banking revenue over the last 20 years and contemplating the intensity of competition yet to come, it is crucial for SCB to rethink its strategies and marketing plan to sustain the growth consumer banking revenue. Correspondent banking service providers domiciled in Bangladesh are expected to be fighting for a bigger pie, as the growth prospect of the country’s correspondent banking business is limited. One of the ways to achieve that objective is to maximize consumer banking revenue generated from local clients and introduces more local products.

At the same time Standard chartered bank must have to consider the consumer mind setup. As a multinational bank customer want more benefit from them then other 3^rd generation bank. So instead of making profit only they should care about the customer as well. They can start many new savings product like millionaire scheme. But here problem is that all these scheme is very costly. So they should introduce something for the middle class, but still SCB continuously working with upper class and upper middle class.

When these types of facility is come on front then and only then Standard Chartered Bank can compete with other banks like HSBC, Prime Bank, Dutch Bangla Bank. Customer is the heart of the bank and if SCB can make them satisfied and make them return to the bank with their deposit it will become the largest profitable bank in Bangladesh within a short period of time.