Report on Uttara Bank Limited

Introduction:

Uttara Bank Limited is a scheduled commercial bank in Bangladesh. It established in Bangladesh under the Bangladesh Bank order 1972, and incorporated as private limited company on June 29, 1983 under the Bangladesh Bank order 1972. Its operation started on August 21, 1983 with a vision to be the market leader through to providing all sorts’ support to people in term of promoting corporate and small entrepreneurs and individuals all over the Bangladesh.

Uttara Bank will be a unique organization in Bangladesh. The Bank consists of major divisions named 1) Corporate banking, 2) Retail banking, 3) Treasury, 4) Small & Medium Enterprise (SME). At present the Bank operating its business by 207 Branches. Uttara Bank is the first local commercial banks that proving online banking service to its customers from the very beginning of its starts.

Uttara Bank Ltd.                                       Chapter: 1  Organization Profile

Organization Profile

Uttara Bank-one of the largest and oldest private-sector commercial bank in Bangladesh, Adaptation of modern technology both in terms of equipment and banking practice ensures efficient service to clients. 207 branches at home and 600 affiliates worldwide create efficient networking and reach capability. Uttara is a bank that serves both clients and country.

UBL is one of the largest private banks in Bangladesh. It operates through 207 fully computerized branches ensuring best possible and fastest services to its valued clients. The bank has more than 600 foreign correspondents world wide. Total number of employees nearly 3,562. The Board of Directors consists of 13 members. The bank is headed by the Managing Director who is the Chief Executive Officer. The Head Office is located at Bank’s own 18-storied building at Motijheel, the commercial center of the capital, Dhaka.

Uttara Bank Ltd.                           Chapter: 1  Organization Objective

Objective of the Organization

The objective of Uttara Bank Limited is specific and targeted to its vision and to position itself in the mindset of the people as a bank with difference. The objective of Uttara Bank Limited is as follows:

Building a strong customer focus and relationship based on integrity, superior service.

 To creating an honest, open and enabling environment

 To value and respect people and make decisions based on merit

 To strive for profit & sound growth

 To value the fact that they are the members of the Uttara Bank family – committed to the creation of employment opportunities across Bangladesh.

 To work as a team to serve the best interest of our owners

 To relentless in pursuit of business innovation and improvement

 To base recognition and reward on performance

  To responsible, trustworthy and law-abiding in all that we do

  To mobilize the savings and channeling it out as loan or advance as the company approve.

  To establish, maintain, carry on, transact and undertake all kinds of investment and financial business including underwriting, managing and distributing the issue of stocks, debentures, and other securities.

  To finance the international trade both in import and export.

  To develop the standard of living of the limited income group by providing Consumer Credit.

  To finance the industry, trade and commerce in both the conventional way and by offering customer friendly credit service.

 To encourage the new entrepreneurs for investment and thus to develop the country’s industry sector and contribute to the economic development.

Uttara Bank Ltd.                                       Chapter: 1  Organization Profile

Mission, Vision, Goal:

Mission:

• To provide high quality financial service
• To provide excellent quality customer service
• To maintain corporate and business ethics.
• To become a trusted repository of customers money and their financial advisor.
• To make their stop superior and rewarding to the customers.
• To display team sprite and professionalism.
• To have a sound capital base.

 Vision:

Uttara Bank will be a unique organization in Bangladesh. It will be a knowledge-based organization where the Uttara Bank professionals will learn continuously from their customers and colleagues worldwide to add value. They will work as a team, stretch themselves, innovate and break barriers to serve customers and create customer loyalty through a value chain of responsive and professional service delivery.

Continuous improvement, problem solution, excellence in service, business prudence, efficiency and adding value will be the operative words of the organization. Uttara Bank will serve its customers with respect and will work very hard to instill a strong customer service culture throughout the bank. It will treat its employees with dignity and will build a company of highly qualified professionals who have integrity and believe in the Bank’s vision and who are committed to its success.  Uttara Bank will be a socially responsible institution that will not lend to businesses that have a detrimental impact on the environment and people.

Uttara Bank Ltd.                                       Chapter: 1  Organization Profile

“Building a profitable and socially responsible financial institution focused on Markets and Business with growth potential, thereby assisting and stakeholders build a “just, enlightened, healthy, democratic and poverty free Bangladesh”.

Uttara Bank-one of the largest and oldest private-sector commercial bank in Bangladesh.

Goal:

Uttara Bank will be the absolute market leader in the number of loans given to small and medium sized enterprises through out Bangladesh. It will be a world-class organization in terms of service quality and establishing relationships that help its customers to develop and grow successfully. It will be the Bank of choice both for its employees and its customers, the model bank in this part of the world.

Strength:

The Bank’s Strength emanates from its owner – Urrara bank. This means, it will hold the following values and will be guided by them as it does its jobs.

• Value the fact that we are a member of the Uttara bank
• Creating an honest, open and enabling environment
• Have a strong customer focus and build relationships based on integrity, superior service and mutual benefit
• Strive for profit & sound growth
• Work as a team to serve the best interest of our owners
• Relentless in pursuit of business innovation and improvement
• Value and respect people and make decisions based on merit
  Base recognition and reward on performance
• Responsible, trustworthy and law-abiding in all that we do.

Uttara Bank Ltd.                               Chapter: 2  Organization Overview

Organization Overview:

Background of the organization:

Uttara Bank Limited had been a nationalized bank in the name of Uttara Bank under the Bangladesh Bank (Nationalization) order 1972, formerly known as the Eastern Banking Corporation Limited which was started functioning on and from 28^th January, 1965. Consequent upon the amendment of Bangladesh Bank (Nationalization) order 1972, the Uttara Bank was converted into Uttara Bank Limited as a public limited company in the year 1983. The Uttara Bank Limited was incorporated as a banking company on 29^th June 1983 and obtained business commencement certificate on 29^th August, 1983. The Bank floated its shares in the year 1984. It has 207 branches all over Bangladesh through which it carries out all its banking activities. The Bank is listed in the Dhaka Stock Exchange Ltd. and Chittagong Stock Exchange Ltd. as a publicly quoted company for trading of its shares.

• UBL is one of the largest private banks in Bangladesh.
• It operates through 207 fully computerized branches ensuring best possible and fastest services to its valued clients.
• The bank has more than 600 foreign correspondents world wide.
• Total number of employees nearly 3,562.
• The Board of Directors consists of 13 members.
• The bank is headed by the Managing Director who is the Chief Executive Officer.
• The Head Office is located at Bank’s own 18-storied building at Motijheel, the commercial center of the capital, Dhaka.

Uttara Bank Ltd.                             Chapter: 2  Organization Network

Uttara Bank Ltd.                              Chapter: 2  Organization Hierarchy

Organization Hierarchy:

Board Of Directors of The UBL

Executive Committee

Uttara Bank Ltd.                                 Chapter: 2  Organization Hierarchy

Audit Committee

Legal Adviser

Auditors

Name of the Senior Executive

Uttara Bank Ltd.                         Chapter: 2  Organization Hierarchy

General Managers

ORGANOGRAM OF UTTARA BANK LIMITED:

• Managing Director (MD)

• Deputy Managing Director (DMD)

• Senior Executive Vice President (SEVP)

• Executive Vice President   (EVP)

• Senior Vice President  (SVP)

• Vice President  (VP)

• Senior Assistant Vice President  (SAVP)

• First Assistant Vice President (FAVP)

• Assistant Vice President (AVP)

Uttara Bank Ltd.                                 Chapter: 2  Corporate Information

Corporate Information

Name of the Company:  Uttara Bank Ltd.

Legal From:                  The Uttara Bank Limited was incorporated as a banking company      on 29^th June 1983 and obtained business commencement certificate on 29^th August, 1983.

Registered Office           90, Motijheel Commercial Area

                                       Dhaka-1000, Bangladesh.

                                       GPO Box: 217 & 818

Telephone                       PABX 9551162

Telefax                           88-02-7168376, 88-02-9572102

Cable                              Banker

Swift Code                     UTBLBDDH

E-mail                            uttara@citecho.net , ublmis@citecho.net

Web site                          www.uttarabank-bd.com

Chairman                        Mr. Azharul Islam

Vice Chairman                Mr.Md. Asaduzzaman

Managing Director          Mr. Shamsuddin Ahmed

Company Secretary         Mr.Md. Fazlur Rahman

Auditors                          M/S. Ata Khan & Co.

                                        Chartered Accountants

Legal Adviser                  Mr. M. Moniruzzaman Khan

                                        Barrister at law

Uttara Bank Ltd.                                   Chapter: 2  Organization Features

Features of UBL

      Bank is an intermediary institute. Like other commercial bank UBL also has some special features. They are as follows:

• Legal Entity: It is compulsory matter for a bank to achieve legal entity.   The stronger legal entity leads to effective banking program. UBL has a strong legal entity.
• Organizational Structure: UBL has a well-set organizational structure. Organizational structure is a precondition of effective banking activities.
• Financial Solvency: Though UBL is an old bank; its ratio of liquidity is well and strong.  So, the clients get greater confidence in the bank.
• Location of The Bank: Location is very useful for bank.  The Head Office and the branches of UBL are located in the central point of the capital and the other district towns.
• Relation with the Central Bank: As the UBL is the government-registered bank, so it maintains a friendly behavior with the Bangladesh Bank.
• Security: The UBL is totally a secured bank.  The clients of the bank get a heavy security on their deposit.
• Management of the Bank: The executives and the officers of UBL are very experienced.  Maximum executives are ex-government bank officers.
• Foreign Exchange: UBL operates foreign exchange business promptly.  There are 13 branch deals with foreign exchange.
• Security: The UBL is totally a secured bank.  The clients of the bank get a heavy security on their deposit.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

SERVICES AND PRODUCTS:

UBL is a service oriented financial institution. The main function of the bank is to provide services to its clients. The bank offers various products and services to the clients to attract them. The first primary job of the bank is to collect deposit from its clients and other prospective clients who still have not opened their accounts at the bank. They offer different accounts at the bank. They offer different interest rates to the different accounts. The bank also provides credit facilities to its clients. In fact the deposits are collected to lend some money to the people to make profit. Also the foreign exchange department opens the L/C to its clients and thus collects L/C commissions from its clients and thus makes a huge profit of its own.

UBL offers many products and services to its clients on their satisfaction. It has a good reputation in the banking sector by continuously updating product and service qualities. A bank cannot be able to make its desirable progress without the satisfaction of its customers. That’s why UBL always gives preference to its client satisfaction and made significant progress through its operation such as deposit mobilization, credit management, foreign trade etc.

SERVICES:

As a financial service institution, UBL provides the following services to its clients.

• Personal Banking
• Corporate Banking
• Capital market services
• SME services
• Online banking services
• Internet banking services.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

   1       Personal Banking:

Amongst private sector banks, UBL has already made its mark in the personal banking segment.

 2       Corporate Banking:

UBL offers a full range of tailored advisory, financing and operational services to its corporate client groups combining trade, treasury, investment and transactional banking activities in one package. Whether it is project finance, term loan, import or export deal, a working capital requirement or a forward cover for a foreign currency transaction, UBL’s corporate banking managers will offer clients the right solution. Customers will find top class skills and in depth knowledge of market trends in UBL’s corporate banking specialists, speedy approvals and efficient processing fully satisfying client’s requirements-altogether a rewarding experience.

3          Capital Market Services:

Capital market operation besides investment in treasury bills, prize bonds and other government securities constitute the investment basket of UBL. Interest rate cut on bank deposits and government savings instruments has contributed to significant surge on the stock markets in the second half of 2004, which creates opportunities for the bank in terms of capital market operations. The bank is a member of DSE and CSE. The investment portfolio of the bank made up of government securities and shares and debentures of different listed companies stood at tk. 3078 millions as on December 31, 2004 indexing a 50% increase over tk. 2046 millions in the previous year. Income from investment stood at tk. 146 millions in 2004 registering a 10% growth over the previous year.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

4          SME Services:

Since inception, the UBL has held socio economic development in high esteem and was among the first to recognize the potentials of SME’s.

 1      Uttara Bank Limited’s involvement:

Recognizing the SME segment’s value additions and employment generation capabilities quite early, the bank has pioneered SME financing in Bangladesh in 2003, focusing on stimulating the manufacturing sector and actively promoting trading and service businesses.

    2      Experience and learning’s:

The single largest problem of the lower end of the SME sector is that they are unable to fully understand their needs. Even if this needs are understood, they are seldom met with right product mix. Small business owners are unable to provide banks with required information of the right type and quality. This has created a gap between the borrower and the banks and has served to limit the outreach of SME financial products. In order to conquer this barrier, Uttara Bank SME unit provides comprehensive support to prospective clients in evaluating their business and preparing the required documents in acceptable formats. In this regard, the Uttara Bank SME unit has been working in close collaboration with the USAID, the SEDF an IFC managed multi donor facility and the World Bank.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

5     Online Banking Services:

Online banking services are designed to provide better services to its clients. Previously UBL used PC bank but now they use world class software named Flora to avail this service to their customers. This allows them to give prompt service to their valued clients. Flora is a universal banking solution that meets the customer’s needs in retail, corporate and investment banking. Under this system, the bank is capable of doing, for example, the following transactions:

• Cash withdrawal from consumer’s account at any branch of the bank;
• Deposit in consumer’s account to any branch of the bank;
• Transfer of money from customer’s account to any other account with any branch of the bank.

But most of the time UBL are using Telephone or Mobile phone.

6      By Telephone & Internet Banking Services:

UBL provide services by telephone and Internet Banking facilities to its clients.

The following are the glimpses of the facilities:

Through Telephone banking:

• Access to the account information any time from anywhere
• Request for cheque book and account statements
• Make cheque status inquiry
• Place stop cheque instruction
• Make utility bill payment.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

              Through Internet banking:

• Access to the account information any time from anywhere
• Fund transfer
• Make utility bill payment
• Open and close term deposit
• Request for cheque book and account statements
• Place stop- cheque request
• Make loan repayment
• Inquire interest and foreign currency rates and many more.

PRODUCTS:

           Personal Banking Products:

• Personal loan
• Car loan
• Vacation loan
• Any purpose loan
• Deposit pension scheme
• Special deposit pension scheme or Income Unlimited
• Uttaran Consumer-Credit Scheme
• Monthly Saving Scheme (MSS)
• Monthly Benefit Scheme (MBS)
• Double Growth Deposit Scheme

These products will be discussed here.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

1. Personal loan:

As part of establishing a personal banking franchise of UBL, the bank has successfully launched personal loan. The product is a term financing facility to aid them in their purchases of consumer durables or services. Depending on the size and purpose of the loan, the number of installments varies from 12 to 48 months.

2          Car loan: 

The car loan is a term financing facility to individuals to aid them in their pursuit of has a car of their dream. The facility becomes affordable to the clients as the repayment is done through fixed installments facility period. Depending on the size purpose of the loan, the number of installments varies from 12 to 60 months. In case of brand new cars, the loan tenure will be maximum 72 months.

3          Vacation loan:

Vacation loan is a term financing facility to individuals to aid them in their hunt for spending a vacation in the country or abroad. The facility becomes affordable to the clients as the repayment is done through fixed installments facility period. Depending on the size and purpose of the loan, the number of installments varies from 12 to 48 months.

4         Any purpose loan:

UBL introduced “Any Purpose Loan”. Now the client can get loan up to tk. 5,00,000 to spend it any way he/she chooses to. The client may avail of

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

this loan facility in any UBL’s branches. As a result this facility is also available at the KBR of UBL.

5          Corporate Banking Products:

• Securitization of assets
• Corporate finance and advisory services
• Syndication of funds.

1          Securitization of assets: 

UBL intends to take up the challenge of securitization of assets and play a significant role in ensuring that securitization of assets becomes a normal part of the range of financial instruments available for organizations who can count on a steady, but piecemeal, flow of revenue and want to translate this stream into cash resources with which to carry out further lending activities to new customers. Some practical issues still need to be settled such as those conceding pricing, or the legal framework, but it is expected that, as UBL and other institutions pursue more such securitization activities these will be resolved.

2         Corporate finance and advisory services:

Given the needs of its large and varied base of corporate clients, DBL will be positioning itself to provide investment banking advisory services. These could cover a whole spectrum of activities such as guidance on

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

means of raising finance from the local stock markets, mergers and acquisitions, valuations, reconstructions of distressed companies and other

expert knowledge bases advice. By this means UBL hopes to play the role of strategic counselor to blue chip Bangladesh companies and then move from the level of advice to possible implementation of solutions to complex financing problems that may arise from time to time. This would be an extra service that would complement the normal financing activities that UBL already offers to corporate business houses.

3          Syndication of funds:

At UBL, the Syndication and structured Finance Unit was setup on October 30, 2004.This unit effectively closed two syndicated deals in the first and second quarters of 2004. The syndications and Structured Finance team as a business unit soon followed up by closing another deal totaling tk. 2.10 billions for a large local corporate. The year 2004 being the first full year of operation for the team ended on a high note as UBL was able to close three syndicated deals as the Lead Bank, two deals as the Co arranger and several other deals as a participant.

6.      Uttaran Consumer-Credit Scheme

UBL started Uttaran Consumers Credit Scheme from 1996.UBL offers opportunity of financial assistance for –

• Motor cycle/car- New or re-conditioned.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

• Refrigerator/ Deep Freeze.
• Television/ VCR /VCP/VCD
• Radio/ Two-in-one/ Three – in – one
• Air-Conditioner/ Water Cooler/ Water Pump
• Washing Machine.
• Personal Computer/ UPS/ Printer/ Type writer
• Sewing Machine.
• House hold furniture- Wooden & Steel.
• Cellular Telephone.
• Fax
• Photocopier.
• Electric Fan- Ceiling/ Pedestal/ Table.
• Bi-Cycle
• Dish Antenna.
• Baby Taxi, Tempo/Microbus (For self employed persons)
• Kitchen articles such as Oven, Micro-oven, Toaster, Blender, Pressure Cooker etc.

7.    Monthly Saving Scheme (MSS)

              Saving is the best friend in bad days. Small saving can build up a prosperous future. Saving can meet up any emergencies. UBL has introduced monthly saving scheme that allows saving on a monthly basis and getting a handsome return upon maturity. If anyone wants to build up a significant saving to carry out your cherished dreams, UBL MSS is the right solution.

8.   Monthly Benefit Scheme (MBS)

               UBL has introduced monthly benefit scheme for the prudent persons having ready cash and desiring to have fixed in income on monthly basis out of it without taking risk of loss and without en-cashing the principal amount. This scheme offers  highest

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

return with zero risk. Everyone can plan your monthly expenditure with the certain monthly under the scheme.

9.  Double Growth Deposit Scheme

                 For people who have cash flow at this moment ant want to get it doubled quickly UBL has Double Growth Deposit Scheme that offers to make double money within 6 years and 10 years respectively resulting a high rate of interest.

DEPOSIT PRODUCTS

At present Uttara Bank Limited has the following deposit product that has been offered to general public:

1          CURRENT ACCOUNT

The client can enjoy maximum flexibility and convenience when he/she opens a current account with us.

This account offers:

• Any number of transactions a day.
• No minimum balance fee.
• Statement of account at your desired frequency.
• Few cost of cheque book.
• Any branch banking facility.
• Statement by Fax on demand.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

2          SAVINGS ACCOUNT

The Savings Account allows the client to have interest income on his/her deposit whilst the account can be used for your transaction purposes. He/she can draw a maximum number of two cheques per week; exceeding this number will forfeit the interest for the month. UBL offers a competitive interest rate (6.00%) on the account. Also there is no requirement for a minimum balance to be maintained in the account to be eligible for the interest. Interest is applied to the account on half-yearly rests.

This account also offers:

• No minimum balance fee.
• Statement of account at client’s desired frequency.
• Few cost of cheque book.
• Any branch banking facility.
• Statement by Fax on demand.

3          SHORT TERM DEPOSIT ACCOUNT

UBL Short Term Deposit Account is a unique blend of flexibility and high return on your deposit. The client can use this account like a current account whilst he earns interest on the account when the stipulated minimum balance is maintained in the account. UBL offers a very competitive interest rate (6.00%) and the interest is calculated on a daily product basis.

This account also offers:

• No limit to the number of withdrawals.
• No minimum balance fee.
• Statement of account at client’s desired frequency.
• Few cost of cheque book.
• Any branch banking facility.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

4          FIXED DEPOSIT ACCOUNT

Clients can open Fixed Deposit Accounts for 3 months, 6 months, 1 year or for longer term. UBL offers competitive interest rates. Clients can Place their deposit under lien with UBL and take a loan, buy shares or open an overdraft account to meet their cash requirements. Interest rates on deposits vary from time to time.

Fixed Deposit Rate:

Foreign Currency Account for private individual/firm/organization:

• Any person/firm/organization who earns foreign currency can open Foreign Currency Account with UBL.
• Payments in foreign currency may be made freely abroad from this account and local payment in Taka may also be made from this account.

Bank pay interest provided the accounts are maintained in the form of term deposit for minimum period of 90 days.

Foreign Currency Account for Bangladeshi Nationals Working and earning abroad.

• No initial deposit is required.

Uttara Bank Ltd.                                      Chapter: 3  Services & Products

• A/c holder nominate his nominee to operate the account.
• The account holder can freely transfer entire amount in foreign currency anywhere he chooses or can convert into Bangladesh Taka currency.
• Funds from this account may also be issued to the account holder up to his entitlement for the purpose of his foreign travels in usual manner.

Resident Foreign Currency Deposit Account

• Persons ordinarily resident in Bangladesh may open and maintain RFCD Account with foreign exchange brought in at the time of his return from travel abroad.
• Any amount brought in with declaration to customs authorities in the form FMJ and up to US$ 5000 brought in without any declaration can be deposited in this account.
• Balance in this account can be freely transferred abroad.
• Funds from this account may also be issued to the account holder for the purpose of his foreign travels in the usual manner.
• Interest in foreign currency is paid in this account if the deposits are for a term of not less than one month and the balance is not less than US$ 1000 or GBP 500 or its equivalent.

Uttara Bank Ltd.                                      Chapter: 3  Financial Position

Financial position of UBL 

PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2007

Uttara Bank Ltd.                                      Chapter: 3  Performance of UBL

Performance of Uttara bank Ltd.

Uttara Bank Ltd. closed the year 2007 recording significant growth in every sector despite volatile economic atmosphere of the country. During the year 2007 Deposit mobilization, enhancement of loans and advances, compliance on corporate Governance, success in foreign trade and effective risk management have placed the Bank in a sound footing. Besides, Bank has maintained a strong market position by adding value to shares it may be said without hesitation that overall performance of the Bank during the year 2007 has been quite satisfactory.

Share Capital:

The authorized capital of the UBL remained at TK 1,000 million during the year under discussion as before. The paid up capital of the Bank has been increase to tk 399.3 million from 199.7 million due to declaration of 100% bonus share for2006. The total number of Shareholders was 12,467. The total equity of Shareholders of the Bank at the end of the year 2007 stood at Tk 2,453.5 million and in 2006 stood at Tk 2,085.4 million.

Reserve Fund:

The reserve fund increase to Tk 2,054.2 million during the year by registering 8.93 percent increase over last year’s Tk 1,885.8 million.

Capital Adequacy:

Capital Adequacy is measured by the ration of the Bank’s capital to risk weighted at the end of the year 2007, the actual capital of the Bank stood at Tk 2,746.7 million against required capital of Tk 2,617.8 million showing surplus of Tk 128.9 million. The capital adequacy rate of the Bank stood at 10.5 percent against required 10.0 percent as fixed by Bangladesh Bank, which is indicative of a sound Capital base of the Bank.

Uttara Bank Ltd.                                      Chapter: 3 Performance of UBL

Assets:

As of 31^st December 2007 total asset of the Bank stood Tk 52,860.3 million showing an increase of 16.9 percent as against that of 2006. The increase in asset was mainly driven by significant growth of loans and advances, investment and balance with Bangladesh Bank.

Deposit:

The deposit of the Bank registered an increase of 10.74 percent during the year under review. At the close of 2007 total deposits stood at Tk 43,360.2 million in the previous year. The deposit mix comprised Tk 11,977.9 million as demand and Tk 31,608.5 million as time deposit.

Loans and Advances:

In 2007 UBL registered a steady growth in credit portfolio posting a growth of 13.17 percent. Total loans and advances of the Bank stood at Tk 28,477.4 million during the year as compared to Tk 25,163.9 million of the previous year. Average loan per branch stood at Tk 137.6 million.

Investment:

The investment of the Bank stood at Tk 14,455.8 million at close the year 2007 showing an increasing of 51.44 percent in comparison to that of the previous year.

Uttara Bank Ltd.                                                 Chapter: 4  SWOT Analysis

SWOT Analysis

SWOT analysis is an important tool for evaluating the company’s Strengths, Weaknesses, Opportunities and Threats. It helps the organization to identify how to evaluate its performance and scan the macro environment, which in turn would help organization to navigate in the turbulent ocean of competition.

1 Strengths

Company reputation: Uttara bank has already established a favorable reputation in the banking industry of the country particularly among the new comers. Within a period of 25 years, UBL has already established a firm footing in the banking sector having tremendous growth in the profits and deposits. All these have lead them to earn a reputation in the banking field

Top Management: The top management of the bank is also major strength for the UBL has contributed heavily towards the growth and development of the bank. The top management officials have all worked in reputed banks and their years of banking experience, skills, expertise will continue to contribute towards further expansion of the bank. At UBL, the top management is the driving force and the think tank of the organization where policies are crafted and often cascaded down.

Facilities and equipment: UBL has adequate physical facilities and equipments to provide better services to the customers. The bank has computerized and online banking operations under the software called MBS banking operations. Counting machines in the teller counters have been installed for speedy service ant the cash counters. Computerized statements for the customers as well as for the internal use of the banks are also available.

Uttara Bank Ltd.                                                 Chapter: 4  SWOT Analysis

Impressive branches: This creates a positive image in the minds of the potential customers and many people get attracted to the bank. This is also an indirect marketing campaign for the bank for attracting customers. 207 branches of the bank are impressive and are compatible to foreign banks.

Interactive corporate culture: UBL, has an interactive corporate culture. Unlike other local organization, UBL’s work environment is very friendly, interactive and informal. There are no hidden barriers or boundaries while interacting among the superior or the subordinate. The environment is also lively and since the nature of the banking job itself is monotonous and routine, UBL’s likely work environment boosts up the spirit and motivation of the employees.

Team work at mid level and lower level: At UBL’s mid level and lower level management, there are often team works. Many jobs are performed in groups of two or three in order to reduce the burden of the workload and enhance the process of completion of the job. People are eager to help each other and people in general are devoted to work.

2 Weaknesses:

Advertising and promotion of SME loan: This is a major set back for UBL and one of its weakest areas. UBL’s adverting and promotional activities are satisfactory but it SME loan is not advertised well. It does not expose its SME product to general public and are not in lime light. UBL does not have neon sign or any advertisement for SME loan in the city. As a result people are not aware of the existence of this bank.

Low remuneration package: The remuneration package for the entry and the mid level management is considerably low. The compensation package for BBL entry level

Uttara Bank Ltd.                                                 Chapter: 4  SWOT Analysis

positions is even lower than the contemporary banks. Under the existing low payment structure, it will be very difficult to attract and retain higher educated employees in UBL.

3 Opportunities:

Diversification: UBL can pursue a diversification strategy in expanding its current line of business. The management can consider options of starting merchant banking or diversify in to leasing and insurance. By expanding their business portfolio, UBL can reduce their business risk.

Product line proliferation: In this competitive environment UBL must expand its product line to enhance its sustainable competitive advantage. As a part of its product line proliferation, UBL can introduce the following products.

ATM: This is the fastest growing modern banking concept. UBL will be introducing ATM with in few months and take preparation for launching ATM. Since UBL is a local bank, they can form an alliance with other contemporary banks in launching the ATM, if they take this opportunity UBL will be a fastest bank in the country. UBL take this opportunity very easily because this bank has lot of branches.

4 Threats:

Multinational banks: The emergence of multinational banks and their rapid expansion poses a potential threat to the new growing private banks. Due to the booming energy sector, more foreign banks are expected to arrive in Bangladesh. Moreover, the already existing foreign bank such as Standard Chartered is now pursuing an aggressive branch expansion strategy. This bank is establishing more branches countrywide and already launched is SME operation. Since the foreign banks have tremendous financial strength, it will pose a threat to local banks.

Uttara Bank Ltd.                                                 Chapter: 4  SWOT Analysis

Upcoming banks: The upcoming private local banks can also pose a threat to the existing private commercial banks like UBL. It is expected that in the next few years more local private banks may emerge. If that happens the intensity of competition will rise further and banks will have to develop strategies to compete against an on slaughter of foreign banks.

Contemporary banks: The contemporary banks of UBL such as Jamuna Bank, Islami Bank, Dhaka bank, Prime bank and Dutch Bangla are its major rivals. Jumana bank and other banks are carrying out aggressive campaign to attract lucrative clients as well as big time depositors.

Default culture: This is a major problem in Bangladesh. As UBL is an old organization the problem of non-performing loans or default loans is very minimum or insignificant. However, as the bank becomes older this problem arises and the whole community suffers from this chronic diseases. UBL has to remain vigilant about this problem so that proactive strategies are taken to minimize this problem if not elimination.

Uttara Bank Ltd.                                      Conclusion of Organization part

Conclusion:

Despite the entire political crisis, economic challenges, serious flood and a devastating cyclone Sidr, Uttara bank Ltd. continued its growth during the year 2007. It is the aim of UBL and intention to accelerate this trend of growth and development of the Bank in advanced level, so as to reach a position where their brand will be associated with being the leading provider of quality banking and financial services in the country.