CHAPTER – 01

Internship report on agroni bank By shaikh Al amin -2n

part
INTRODUCTION
1.1 Background of the Report
Internship program is a pre-requisite for acquiring BBA degree. Before completion of the degree,
a student must undergo the Internship program. As the classroom discussion alone cannot make a
student perfect in handling the real business situation, therefore, it is an opportunity for the students
to know about the real life situation through this program. And a report is required to be prepared
to summarize the intern’s analysis, findings and achieved knowledge from this program. This
report is a basic academic requirement for the completion of BBA under the Department of
Accounting & Information Systems, in Jagannath University, Dhaka.

The report titled “The activities of Government Commercial Bank in Bangladesh on the light
of Agrani Bank Limited are based on the study done in the 3 month internship period in Agrani
Bank Limited (ABL) Head office Principal Branch. It contains a concrete idea about the overall
activities of ABL as a Government Bank.
1.2 Problem Statement
It is very common conception of General people upon Government institutions that they are greatly
corrupted, inefficient service provider and not working properly for the country people. But in
many cases this is being a misconception with the changing world. Now Government
Organizations are trying to be correct to keep with the modern world or is going to correct way
automatically to keep with modern world. Though main purpose of government organizations is
to provide services to the country general public, this is not remaining limited only providing
services but the demand of time also making profit and trying to survive with computing other
organization. Government Bank is one of them organization which is considered as a sensitive
organization of a country economics. So my problem statement is that how and why the
government bank service system and other Practices are changing in Bangladesh. This statement
is set up to find out what activities are Performed by a commercial bank Limited.
 1.3 Objectives of the Report
The main objective of the study is to examine and explore the Overall activities of Government
Bank on the basis of General Bank Division, Advance Division and Foreign Exchange Division
of Agrani Bank Limited Principal Branch. The study also discovers the nature of activities of
Government which differentiates to government bank from a private bank, statements related to
financial position of the Bank and Systems of Accounting, comparative Discussion of modern
bank. However, the objectives of the study can be divided into two basic parts:
A) Primary Objectives
The primary objectives of the report are as follows:

 To fulfill the requirement of BBA program containing three-month internship.

 To gain some practical job related experience along with all academic knowledge.
B) Secondary Objectives
The secondary objectives of the study are as follows:
 To explore the nature of service and activities of Agrani Bank Limited.
 To explore the nature of accounting practice of Agrani Bank Limited.
 Getting a overview of banking business in Bangladesh
 To gain a full overview about functions of ABL.
 To comprehend the contribution of ABL in Government activities.
 To investigate the performance of ABL from accounting and overall activities perspective.

1.4 Scope of the Report

Principal Branch and Head office Different division of ABL. are used as sources of information.
Mostly information is collected from Principal Branch GB, Advance and Foreign Exchange
division and it’s several Sections. So scope of this report is the banking activities and accounting
systems. So it is said that scope of this report is overall activities and accounting Policy and
practices of government bank on the light of ABL.

1.5 Methodology of the Study

a) Report Design
 A descriptive research approach has used to conduct the report. According to Business Research
Methods by Willium G. Zikmund (Seventh Edition), descriptive research is a type of conclusive
research which has its major objective is to provide the description of something-usually market
characteristics or functions.
While conducting smooth and accurately study everyone has to follow some rules and regulations.
In this report I use both primary and secondary data. The details of the work plan are furnished
below:
b) Data Collection Method

Relevant data for this report will be collected primarily by direct investigations of different records,
papers, documents, statements, operational process and different personnel. The interviews will
administer by formal and informal discussion. No structured questionnaire will be used.

d) Data Sources

The information and data for this report will be collected from both the primary and secondary
sources.

Primary Sources

 Face-to-face conversation with the respective officers and stuffs of different section of the Branch.
 Relevant field study as provided by the officer concern.
Secondary Sources
 Annual report of Agrani Bank Limited
 Different manuals and publications of Agrani Bank Limited
 Different manuals and publications of Bangladesh Bank.
 Unpublished data (daily, monthly and yearly statements, ledgers) received from different section
 Different text books.
 Different circulars passed by Board of Director (BOD)
 Official web site of ABL.

1.6 Limitations of the Study

 Like any other study the limitations of this study is not out of questions. But the following factors
seem to me the main points of weakness of this study, despite all out co-ordination from the bank
officials.

 The main constraint of the study is inadequate access to information, which has hampered the
scope of analysis required for the study. I could not use some important confidential information
of ABL because those may be very sensitive for the county and overall Banking operation of
Bangladesh as ABL is a Government Bank. So, I could not use this confidential information in
this report.
 Due to time limitations many of the aspects could not be discussed in the present report.
 Since a very few the bank personals have accounting based knowledge, many of official can’t
provide a good briefing to me.
 Another problem is that creates a lot of confusions regarding verification of data in case of
interview from more than one person.
 I carried out such a study for the first time, so inexperience is one of the main constraints of the
study.

CHAPTER - 02

OVERVIEW OF AGRANI BANK LIMITED

2.1 What Kind of Organization

I choose the organization named Agrani Bank Limited (ABL), which is the Government bank of
Bangladesh. I choose this bank for some reasons: firstly, the ABL appointed me and give me the
opportunity to doing my internship program. Secondly the working procedures of Government
Bank perform all the activities of commercial Bank and Financial Institutions. And Agrani banking
is more operating his business more smoothly than other Government Banks.

2.2 Introduction of Agrani Bank Limited

Agrani Bank Limited, a leading commercial bank with 879 outlets strategically located in almost
all the commercial areas throughout Bangladesh, overseas Exchange Houses and hundreds of
overseas Correspondents, came into being as a Public Limited Company on May 17, 2007 with a
view to take over the business, assets, liabilities, rights and obligations of the Agrani Bank which
emerged as a nationalized commercial bank in 1972 immediately after the emergence of
Bangladesh as an independent state. Agrani Bank Limited started functioning as a going concern
basis through a Vendors Agreement signed between the ministry of finance, Government of the
People's Republic of Bangladesh on behalf of the former Agrani Bank and the Board of Directors
of Agrani Bank Limited on November 15, 2007 with retrospective effect from 01 July, 2007.
Agrani Bank Limited is governed by a Board of Directors consisting of 13 (thirteen) members
headed by a Chairman. The Bank is headed by the Managing Director & Chief Executive Officer;
Managing Director is assisted by Deputy Managing Directors and General Managers. The bank
has 11 Circle offices, 25 Divisions in head office, 62 zonal offices and 879 branches including 27
corporate and 40 AD (authorized dealer) branches

2.3 History of Agrani Bank Limited

Agrani bank, in pursuance of Bangladesh banks (nationalization) order 1972 (P.O. No-26 of 1972)
came into being in 1971 taking over the assets and liabilities of the east while Habib bank ltd. And
commerce bank ltd. Functioning in the then East Pakistan. The bank started operation with 249
branches with its head office in Dhaka. In principle, it changed its motto from class banking to
mass banking. As there had been poor banking structure and it failed to build sound banking
infrastructure by local entrepreneurs before independence and the newly born independent country
was down with enormous economic problem, the new govt. Agrani Bank being one of the largest
nationalized commercial bank must shoulder the responsibility of expanding its network in rural
area. Presently bank has its 561 branches out of total 891 branches located in rural areas
implementing as many as 29 programs targeting rural people. During my internship at Agrani
Bank Ltd, I was placed in the Principal Branch under Head office of ABL. I enjoyed my total
working with the young, skilled & professional employees and earn my knowledge regarding
financial and non financial performance of Agrani Bank ltd. Bangladesh

2.4 Brief Profile of Agrani Bank

Name of the Company Agrani Bank Limited
Chairmen Khondoker Bazlul Hique, PhD
Managing Director and CEO Syed Abdul Hamid, PhD
Company Secretary Badal Chandra Dey
Legal Status Public Limited Company
Genosis Agrani Bank emerged as a nationalized commercial
bank in 1972 immediately after the emergence of
Bangladesh as an independent state. Agrani Bank
Limited started functioning as a going concern basis
through a Vendors Agreement signed between the
ministry of finance, Government of the People's
Republic of Bangladesh on behalf of the former Agrani
Bank and the Board of Directors of Agrani Bank
Limited on November 15, 2007 with retrospective
effect from 01 July, 2007.
Date of Incorporation 17 May 2007
Registered Office 9/D Dilkusha Commercial Area, Dhaka 1000
Bangladesh
Authorized Capital TK. 1,000.00 Crore
Paid up Capital TK. 901.18 Crore
Reserve and Retained Earnings Tk. 1,693.08 crore
Credit Rating By CRISL Date of Rating Declaration September 25, 2011
Particulars Long term Short term
Entity AAA ST-1
Rating (as an
Government Bank)
Surveillance Rating A+ ST-2
2010 (stand Alone
Basis)

Surveillance Rating A+ ST-2

2010 (stand Alone
Basis)

outlook of 2010 stable

Number of Employees 12,085 (8,498 officers and 3,587 staffs)
Number of branches 876 ( at 2012) 889 (at 2013 last)
Number Subsidiary companies 4
Phone -PABX +88-02-9566153-4, +88-02-9566160-9

SWIFT at ID, HO AGBKBDDH

Website www.agranibank.org
E-mail [email protected]
 Table : 1
2.5 Vision, Mission & Motto
To become the best leading state owned commercial bank of Bangladesh operating at international
level of efficiency, quality, sound management customer service and strong liquidity.
2.5.1 Mission & Motto
To operate ethically and fairly within the stringent framework set our regulators and to assimilate
ideas and lessons from best practices to improve our business policies and procedures to the benefit
of our customer and employees.
2.5.2 Motto
To adopt and adapt to modern approaches to stand supreme in the banking arena of Bangladesh
with global presence.
2.6 Strategic Objectives of the Bank
 Winning at least 6.50 percent share of deposits and 5.50 percent share of loans and advance of
Bangladesh market.
 Gaining competitive advantage by lowering overall cost compared to that of competitors.
 Overtaking competitors by proving quality customer service.
 Achieving technological leadership among the peer group.
 Strengthening the Bank’s brand recognition.
 Contributing towards the economic well-being of the country by focusing particularly on SME
and agricultural Sectors.
 Strengthening research capability for innovative products.

Chart: 2 Organization Structure

2.9 Products and Services

 Deposit
 Current Deposit
 Saving deposit
 Fixed deposit (FDR)
 Special Notice Time Deposit (SNTD)
 Non Resident Special Taka Account (NRTA)
 NR investors Taka Account (NRIT)
 Agrani Bank Pension Scheme (APS)
 Agrani Bank Bishesh Shanchay Scheme (ABS)
 Monthly Deposit Scheme (MDS)
 Monthly Income Scheme (MIS)
 Students Savings A/C (School Banking)
 Small Life Insurance Policy Holders A/C
 Farmers A/C
 Freedom Fighters A/C
 Other Beneficiaries A/C Under Social Security’s Program
 Foreign currency Account
 Foreign currency (FC) A/C
 Non Resident Foreign Currency Deposit (NFCD) A/C
 Resident Foreign Currency Deposit (NFCD) A/C
 Exporters Retention quota (ERQ) A/C
 Loan& Advance
 Continuous Loan
 Cash Credit (Hypo)
 Cash Credit (pledge)
 Secured Overdraft (SOD)
 Term Loan
 Inland Bill Purchase (IBP)
 Export Cash Credit
 Industrial Credit(IC)
 Housing Loan (General & commercial)
 Consumer Credit
 Loan for Overseas Employment
 Weavers’ Credit
 Rural & Agro credit
 Crop Loan
 Fishery Loan
 Animal Husbandry Loan
 Agri Machinery Loan
 Rural Transport Loan
 Swanirvar Loan
 Poverty Alleviation Loan
 Small and Medium Enterprise Loan
 Service Sector Loan
 Trading Sector Loan
 Manufacturing Sector Loan
 Import Finance
 Loan against Imported Merchandise (LIM)
 Loan Against Trust Receipt (LTR)
 Payment against Document (PAD).
 Export Finance
 Export Cash Credit
 Packing Credit (PC)
 Local/Foreign Bills Purchased (FBP)
 Loan Against Export Development Fund (EDF)
 Advance Against Cash Incentive (Subsidy, Assistance)
 Treasury
 Money Market
 Maintaining CRR and SLR
 Call Money Transaction
 Term Placement
 Treasury Bills
 Treasury Bonds
 REPO
 Reverse REPO
 Secondary Trading of Govt. Securities
 Custodian Services
 Other Investments
 Foreign Exchange Market
 Providing Foreign Currency for Import Payment
 Preparation of Exchange Rate
 Foreign Currency Buying and Selling
 SWAP Transactions
 Foreign Exchange Forward Transaction
 Term Placement
 Letter of credit
 Letter of Credit-Sight
 Letter of Credit-Usance
 Back to Back L/C
 Letter of Guarantee
 Advance Payment Guarantee
 Bid Bond
 Performance Guarantee
 Shipping Guarantee
 Guarantee-Others
 Standby Credit
 Other Foreign Exchange Service
 Documentary Bill Collection
 Advanced Payment for import & Export
 Foreign Remittance (Incoming & Outgoing)
 Foreign Currency Endorsement against Passport
 Issuance of Draft, TT
 Collection of Draft, Cheque, TC
 Opening of Student File, Medical File
 Cash Service
 ATM Service
 Cheque Encashment
 Foreign Currency
 Fund Transfer
 Inter-Branch Money Transfer

 SWIFT
 Telegraphic Transfer (TT)
 Issuing Foreign Draft
 Enchasing Foreign Draft
 Bangladesh Electronic Fund Transfer Network
 Bangladesh Automated Clearing House(BACH)
 Online Deposit to Accounts
 Value Added Service
 Locker Service
 Utility Bill Collection
 Merchant Banking Service
 Issue Management
 Underwriting
 Portfolio Management

Islamic Baking Service

 Deposit
 Al Wadiah Current A/C
 Mudaraba Savings A/C
 Mudaraba Term Deposit
 Mudaraba Special Scheme Deposit
 Investment
 Bai Murabaha(Pledge)
 Bai Muazzal(Hypo)
 Higher Purchase Shirkatu Meilk
 Bai Salam
 Information and Communication Technology

2.10. Automation and Modernization in Agrani Bank Limited

2.10.1 Development in IT sector
Information and Communication Technology (ICT) has its direct impact on productivity and
competitiveness in both domestic and international markets. We are proud that Agrani Bank
Limited was the first among the commercial banks in this country to introduce computer-based
technology back in 1968. It started its journey from 1968 using IBM midrange computer. Since
then amidst increasingly fierce competition, the efficiency gains and the speed of IT have offered
us the opportunity to open up new sources of advanced, innovative products and improved
customer service. Sufficient allocation will be made for hardware and software to ensure complete
implementation of our ambitious plans for the increased use of ICT and Management Information
Systems (MIS)
2.10.2 Overall automation
Agrani Bank Limited started widely using computer technology for automation of its various
banking operations. Many important jobs of the bank are currently automated. The Information
Technology (IT) Division of the bank responsible for managing automation of banking operations
is well equipped with IBM Midrange computers, very High End Servers and latest microcomputers
and staffed with trained and experienced personnel. The Bank uses its in-house software for
processing most of the jobs performed on IT Division. The major jobs, developed and handled in
IT Division are:
a) Inter- branch Transaction Reconciliation.
b) Foreign Bank Accounts Reconciliation (Nostro Accounts).
c) Consolidation of statements of Affairs/ Income & Expenditure Statements.
d) Personnel System.
e) Pay-roll of Head Office Employees etc.
f) Inventory Management.
2.10.3 Branch Computation
Agrani Bank Limited has grown significantly over the years in branch automation. Till date 488
branch out of its total 876 branches are computerized by using LAN based Branch Banking
 Software. This software has been supplied by various renowned software vendors of the country.
The major functionalities of the branch banking software:
a) General Banking-Deposit, Inland remittance, GL/PL.
b) Credit-all kinds of commercial loans and staff loans.
Most of the banking activities can be carried out using this software. Bank provides continuous
training for the uses of this software. The rest 388 branches will be brought under this system by
May 2012. Now, all the branches are having adequate computers with internet connectivity along
with `Online Foreign Remittance Payment Software’ and `GL Software’ capable of making instant
payment of foreign remittance to the beneficiaries and preparing daily Statement of Affairs and
Profit and Loss Statement besides making other day-to-day correspondences.
2.10.4 Online Banking
IT-based baking has a major role to play in rendering improved services to the valued customers
and stakeholders in to-day’s competitive banking environment. The Bank has taken various
measures for automation of its functions and services. One of the major steps is installation of fully
integrated online core Banking solution (T20 by Temensos). It began in 2010 with two pilot
branches and how it has progressed further. At present, in our 102 major branches in the country
are totally operating online Banking under this software. It should be mentioned that T24 software
is rated as number one core banking software all over the world. For this purpose, a most modern
data center equipped with all related hardware, database, connectivity and all other facilities was
established in head office. Besides, a disaster Recovery Site (DRS) was rented in Mohakhali where
a true replica of data center is established. The hardware related to data center and DRS has been
set up with a capacity to handle all the online branches of the branches of the bank. Again, to
handle such a big customer base, Oracle database is being used.
All the modules of T24 have been customized as per existing business process and rules of the
bank considering the guidelines of Bangladesh bank. Another 250 branches will be brought under
this system by 2012. The Bank has planned to bring a total of 400 branches under this system by
the year 2013.
Introduction of T24 software will ensure services like internet banking, ATM banking, and mobile
banking to the customers.

2.10.5 BACH & BEFTN

As part of the plan of Bangladesh Bank for automation of clearing payment system of the country,
Bangladesh automated clearing House (BACH) was introduced in the bank. The two components
of (BACH0- Bangladesh Automated Cheque Processing System (BACPS) & Bangladesh
Electronic Fund Transfer Network (BEFTEN) are activities in the bank. A total of 178 branch of
the bank in 9 clearing areas of the country have been brought under BACPS successfully. For this
purpose, hardware, MICR check scanner, network connectivity has been established in each
concerned location. For, BACH operation sophisticated centralized software has been customized
and installed which has facilitated the smooth operation of the system throughout the country. The
other component BEFTN has been allowed in it. The debit operation will begin very soon. With
the introduction of automated clearing system, customer service has greatly improved.
2.10.6 E-GP
The government of Bangladesh has introduced e-GP(Electronic Government Procurement)
program under CPTU(Central Procurement Technical Unit) of planning ministry. The contractors
of 4 organizations i.e (1) Road & Highways,(2) LGED,(3) BWDB and (4) REB can participate in
e-tendering by depositing their registration fee, renewal fee, tendering document fee, bank
 guarantee etc from designated 86 branches of the bank all over Bangladesh. A formal high-level
training on e-Gp has been provided to a large number of employees of the bank. The bank has
voluntarily participated in e-GP program to meet its commitment to serve the nation.
2.10.7 Website
Agrani Bank Limited has an informative website description of its various products, services,
annual accounts, citizen’s charter and other up-to-date information about the Bank.
The website www.agranibank.org services as a primary source of information of the bank. Current
news on recruitment, tender etc. are also found in this website.
2.10.7 ATM
Agrani Bank Limited has introduced ATM( Automated Teller Machine) card facility Known as E-
cash Card. Under this system, a cardholder can get round-the clock services of cash withdrawal
and utility bills payment facilities. Our bank is sharing 200 ATM booths with AB Bank located at
different cities of the country of which 5 are located at bank’s premises. The bank is planning to
increase the number of card holders, ATM booths and related products.
2.10.8 Introduction of Mobile banking
Agrani Bank Limited is planning to offer some transaction facilities through mobiles set. As most
of the population of Bangladesh is un-banked, our bank is going to implement a system to launch
mobile banking channel. With this facility any person having a mobile number will be able to use
his number as a bank account. The facilities of mobile banking are:
a) Cash Deposit
b) Cash Withdrawal.
c) Fund Transfer to another Mobile Account.
d) Utility Bill Payment.
e) Receive Remittance from Home And Abroad.
f) Salary Payment
g) Merchant Payment
.
2.11 Progress Achieved In Last Year
In all major areas, the Bank made remarkable progress. Deposits grew by 22.24 percent in 2011
and reached TK. 25.221 crore from Tk. 20.633 crore as against Tk. 16,326 crore in 2010; Total
loans and advances in 2011; which is 18.88 percent higher than that of the previous year. The
Bank’s profit continued to grow in 2011. The operating profit rose by 45.86 percent to Tk. 402
crore. Meeting up this incremental capital requirement become possible only when there is a high
rate of operating profit.
2.12 Shareholders’ Equity
The shareholders’ equity of the Bank as on 31 December 2011 stood at Tk. 2,594 crore from Tk.
1,022 crore in 2011 than previous year.
The paid up capital of the Bank has increased from Tk. 497 crore to Tk. 901 crore due to issuance
of right share and bonus share during 2011.
Sources of Fund 2011 2010
Deposits 25,220.84 20,632.60
Paid-up-capital 901.18 546.52
Statutory Reserve 413.98 267.08
Assets Revaluation Reserve 26.93 90.25
General Reserve 753.84 217.98
 Retained Surplus from profit 0.50 0.50
and Loss Account
Total 497.83 449.39
27,815.10 22,204.32

Chart No:3 Shareholder Equity

2.13 BUSINESS PERFORMANCE
2.13.1 Deposits
At the end of December 2011, the deposit of the Bank stood at Tk. 25,220.84 crore compared to
Tk. 20,632.60 crore at the end of previous year leading to a year-on-year growth in deposit of
22.24 percent. Given the adverse economic scenario of the country during the year under review,
this growth rate is a remarkable achievement. In the prevailing situation, mobilization of deposits
became highly competitive and as a result, the average cost of fund for the banks in the private
sector increased compared to that of the previous year. The Bank, therefore, decided to mobilize
low cost fund. The deposit mix of the Bank as on 31 December 2011 was as follows:
2.13.2 Asset Quality
The Bank maintained quality of asset and this is one of the strong areas of its operation. The Bank
did not compromise with its standard of excellence in terms of maintain asset quality while
extending credit facilities. In order to improve the quality of our assets, the Bank Management has
prioritized financing in trade and commerce by providing working capital. Moreover, some
pragmatic steps have been taken to reduce non-performing loans as well as to prevent new
classification thereof.

CHAPTER 3

CONCEPTUAL FRAMEWORK:
3.1 Origin and Definition of Bank
Barter System→ Money→ Bank.
Though it is still not possible to find out exact place and time of origin of bank but some historian
has tried to discover of the history of Bank by using various evidences and events. At past, people
made transactions by barter system. In this system, they transact products. If someone had enough
rice, his required fish then he would go to fisherman for collecting fish in exchange of rice. On the
other hand, fisherman had required rice & they transferred products one to another. By using this
system, they were continuing their lives. However, at a time barter system failed due to divisibility.
Due to failure this system, people develop money.
This is now the common medium for transactions. For securing money, people establish bank. By
which they are maintaining their transactions.
The Word `bank’ is come from banke, German (Banko) Italy and then Bank English. A brief
definition "A broader definition may be given as” A bank is any financial institution that receives
collects transfer pays, exchanges, lend invest and safeguard money for its customer. To be a bank
must authorized by the central bank. Intact bank is the lifeblood of modern economy. Generally
speaking bank is referred to an organization that deals in money.

3.2 History of Bangladesh Banking Industry

Bangladesh inherited its banking structure from the British regime and had 49 banks and other
financial institutions before the Partition of India in 1947. The Dhaka Bank established in 1806
was the first commercial bank in the Bangladesh region of British India. Later in 1862, the Bengal
Bank Purchased the Dhaka Bank and opened its first branch in Dhaka in the same year. There were
six other branches of Bengal Bank in operation in the territory of Bangladesh until the Partition of
British-India in 1947.
Following the emergence of Pakistan in 1947, State Bank of Pakistan, the Central Bank of the
country, came into being in July 1948. Pakistanis owned most of these banks and only three of
them namely, National Bank of Pakistan, Habib Bank Ltd. and the Australasian Bank Ltd, had one
branch of each in East Pakistan in 1949.But all of them had their headquarters in west Pakistan.
In the beginning of 1971, there were 1130 branches of 12 banks in operation in East Pakistan. The
foundation of independent banking system in Bangladesh was laid through the establishment of
the Bangladesh Bank in 1972 by the Presidential Order No. 127of 1972 (which took effect on 16th
December, 1971). Through the Order, the eastern branch of the former State Bank of Pakistan at
Dhaka was renamed as the Bangladesh Bank as a full-fledged office of the central bank of
Bangladesh. Others commercial bank are nationalized and bring under government control
3.3 Banking Operation in Bangladesh
The development process of country largely depends upon it economic activities for bringing about
socioeconomic changes in a developing country like Bangladesh Three different sectors like
agriculture, commerce and industry provide the bulk of a country’s wealth.
Banks provide both short-term and long-time credit. The customers come from all walks of life
from small business a multi-national corporation having its business activities all around the word.
The banks have to satisfy the requirement of different customers belonging to different social
groups. The banking business has therefore become complex and requires specialized skills. I
 regardless of the numbers of banks and nature of their functions and activities, a central bank exist
to regulate the activities of other banks. All the commercials private and or nationalized and
specialized bank perform service related activities within the jurisdiction of the central bank. In
our country, Bangladesh the role of the central bank is entitled to be executed by Bangladesh Bank.
3.4 Total Banks and Their Branches in Bangladesh
The country’s central bank is Bangladesh Bank, which is a name of regulatory bank, controls and
monitors the banking industry. Bangladesh Bank (BB) has been working as the central bank since
the country's independence. Its prime jobs include issuing of currency, maintaining foreign
exchange reserve and providing transaction facilities of all public monetary matters. BB is also
responsible for planning the government's monetary policy and implementing it thereby. The BB
has a governing body comprising of nine members with the Governor as its chief. Apart from the
head office in Dhaka, it has nine more branches, of which two in Dhaka and one each in
Chittagong, Rajshahi, Khulna, Bogra, Sylhet, Rangpur and Barisal.
There are 4 Nationalized Commercial Banks with 3616 branches, 28 privatized banks with 1214
branches, 13 foreign banks with 32 branches and 4-development financial institution with 1177
branches, 4 specialized bank in Bangladesh.
Currently the major financial institutions under the banking system include:
 Bangladesh Bank
 Commercial Bank
 Islamic Banks (for interest free Islamic banking in adherence to t
 he shariah, i.e., Islamic banking principle and practice.)
 Leasing Companies
 Finance Companies
 Merchant Banks
The name of the Banks which are operating business in Bangladesh, are:
3.5 Role Of Bank In Banladesh
Bangladesh as a member of third world countries with poor income level, a disappointed literacy
rate, vast poverty range and peoples unconscious attitude toward savings and investment
Bangladeshi banking sector has great role to economic enhancement. Besides banking industries
has been an important field of employment.
3.6 Regulatory Environment
Ministry of finance & Bangladesh Bank regulates the sector through monitory and fiscal policies.
3.7 Ministry Of Finance
Approves budget of NCBs---Provide operational policy guidelines for NCBs---Appoints the MDs
and GMs of NCBs
3.8 Bangladesh Banks
Set guidelines for banks---Has the authority to issue licenses for new banks---BRPD regulates
deposits, advances, capital & reserves---DBOD looks after bank licensing & expansion. The range
of banking products and financial services is also limited in scope. Besides all local banks are
imposed with 5 percent Cash Reserve Requirement (CRR), which is non interest bearing and 15
percent Statutory Liquidity Requirement (SLR). This has given rise to higher cost of funds. With
the liberalization of markets, competitive on banking products and financial services seem to be
more intense and competitive