INTERNSHIP REPORT

ON

Trend of operation of IFIC Bank Ltd

Supervisor:
Salah-Uddin Lecturer Department of MIS University of Dhaka

Prepared by:
Kazi Md. Nayeem Hossain ID No# 01-56 BBA 1st Batch Date of Submission: August 19, 2010

Department of MIS, University of Dhaka

LETTER OF TRANSMITTAL
Date- August19, 2010 Salah-Uddin Internship Supervisor Department Of MIS University of Dhaka Subject: Submission of the assignment report titled Trend of operation of IFIC Bank Ltd.. Dear Sir, Its my pleasure to submit you my internship report on Trend of operation of IFIC Bank Ltd... I have completed my internship program in IFIC Bank from 05-07-2010 to 15-082010 as a part of my study. Here is my overview on Trend of operation of IFIC Bank Ltd.. I have tried my self to explain my learning and experience I have gathered form my internship program briefly in this report. I appreciate that this approach really contributes in giving my course learning a lasting shape in me. The entire report is based on my practical experience in bank. I have put my best effort in completing the report with all the information that I have collected during my stay in IFIC BANK. I have great hope that the report will meet your expectation and aid you in getting a clearer idea about the subject. Please do call me for any clarification regarding the report, if required.

Sincerely, Mohammad Abu Talha Sunny ID No# 01-36 BBA 1st Batch

CERTIFICATE

This to certify that the internship report on Trend of operation of IFIC Bank Ltd.. is a unique attempt to identify the real Financial Position of the financial institution. The report is submitted for the award of the degree of (BBA) from Dhaka University, Bangladesh. It is a record of research credit out by Kazi Md. Nayeem Hossain under my supervision. No part of internship report has been submitted for any degree, diploma, and title of recognition before. He is permitted to submit the internship report.

. Salahuddin Lecturer Department of MIS University of Dhaka. Bangladesh.

DECLARATION
I am Kazi Md. Nayeem Hossain, student of Business Administration Department (BBA Program) major in MIS of Dhaka University Bangladesh do hereby declare that the internship report Trend of operation of IFIC Bank Ltd. has not been submitted by me before, for any degree, diploma, title or recognition.

Kazi Md. Nayeem Hossain. Id No- 01-56 MIS Department

ACKNOWLEDGEMENT

While doing this report, I have been assisted by many. I remember my friends and collogues who did their best to help me in complete this report. Firstly, I like to thank my teacher Mr. Salahuddin for agreeing to be my supervisor and allowing me to write the report on the proposed topic. In the report proposal, he inserted necessary corrections and suggestions. Later on, I based my work on those suggestions. Secondly, I like to thank Md. Mosharaf Hossain Mridha (Manager, Donia Branch) in IFIC Bank ltd. He posed relentless and undaunted on whole request I made to him regarding finding out of current information and publications to do my internship report. Finally, I want to express my heartful gratitude to all my colleagues of IFIC Donia branch who support me by whatever means they had. Above all, I considered it a great opportunity to work under one of the best banking personality of present time, Mosharaf Hossain Mridha IFIC Donia branch manager. Under his able supervision my days in the bank were challenging and exciting as well.

Kazi Md. Nayeem Hossain.

Executive summery
On completion of 30 credit hours and a comprehensive examination, a student of MBA program of the business faculty, university of dhaka is required to undertake an internship program. For this purpose each of them is attached with an institution. The basic purpose of this attachment is to expose the students to real situation and acquaint them with practice of modern business world. This exposure is helpful to know how things move and to find the gap as well as similarly between theoretical knowledge and practical operation. The internship is designed to bridge the gulf between the theoretical knowledge and real life experience as a part of masters of business administration (MBA) program. It is designed to have a practical experience while passing through the theoretical understanding. In the present competitive financial market, each organization has to operate efficiently in its optimum capacity. on the eve of the arrival of the year 2006, each bank has been preparing to face new kind of challenges from the various fields. My reports contains five parts: Introduction, overview of IFIC Bank , Bank operation of IFIC, performance analysis and last part include problems identification, summery of main finding and recommendation and conclusion. In my report, I have mainly focused on the Trend of operation of IFIC Bank ltd. I have seen that, reserve and surplus position from 2000- 2005 gradually increasing, deposit position also increased in this time, in case of credit, it was fall in 2003 but after 2003 it was again increasing, in case of foreign exchange business ,export business is greater than import business but In 2003 import business was greater than export. Banks net profit was decreased between 2000-2004 but in 2005 it was increased in 82 million taka. companies profit target in 2006 is 100 crore taka. Banks deposit achievement was 2619.81 crore till june 2006, advance was 2402.89 and foreign exchange position was 4272.55 crore till june 2006. At present, Banks administration cost is 3.70% which is on the high side compared to other private sector bank. They have taken a project Horizon for implementation of on- line banking. Now 5 branches (gulshan, motijheel, narayangong, agrabad and sylhet) are under the on-line banking. During my staying in IFIC Bank ltd, I experience a lot of things from my assigned desks work. I observe that , banker customer relation is a major consideration for the bankers. Computerization of all branches of IFIC Bank ltd. is a very bold, positive and progressive step towards modern technology and in the race of survival. I generally hope that my report will aid in understanding the trend of operation of the bank. I sincerely appreciate the assignment. TABLE OF CONTENTS

SI. No. I II III IV V VI VII VIII IX X XI XII XIII

PARTICULARS 1st Cover Page 2nd Cover Page Letter of Transmittal Letter of Placement as Internee Letter of Authorization Acknowledgement Executive Summery Table of contents Chapter -one Chapter- two Chapter- three Chapter- four Chapter- five

CHAPTER- ONE

Introduction
1.1 1.2 1.3 1.4 1.5 1.6 1.7 The internship Background of the report Objective of the study Methodology Sources of data Scope of the study Limitation of the study

1.1

Introduction

The internship : serving in the IFIC Bank since July 24, 2006 as an internee and will finish in October 2006. I divided my internee period into two parts. The first 3 weeks were stipulated for collection of data. The remainder of the time was for the completion of the report. With permission from my honorable supervisor Dr. A.R. Khan. I decided to write on the trend of operation of the IFIC Bank ltd. with the introduction of the market economy in the country, the banking sector, like others have become more and more competitive and challenging. The growth of operation of IFIC Bank ltd is important factor. By discussion of this topic I can understand the overall present condition of IFIC Bank ltd. From the present condition of the bank I found some good side and bed side and suggested how bank can overcome their problems. My supervisor in the bank was SK. Rashid Ahmed ( manager, IFIC federation branch), he cooperative me strongly and let me share his experience in banking. Besides, all the employees of the IFIC Bank ltd, federation branch assisted me gladly and took considerable interest into what I was doing.

1.2

Background of the report

In recent years, competition in the banking sector has increased to a considerable degree. The domination of the government banks has been in the evanescence not only because customer faith in the reliability of the private commercial banks has strengthened but also because, service condition in the government banks has deteriorated. The invisible hand of the free market now determine interest rates on deposit and lending. As such, on bank is being able to offer a considerably superior interest rates on deposit and lending. So the only means to draw the customers lies with better improved and innovative customer product and service. IFIC Bank ltd. is a leading bank among the private commercial banks. The banks overall progressive evaluation has gained considerable momentum over the last few years. But to retain this status, it has to improve its service condition to a better degree. In my report, I have discussed on trend of operation of IFIC Bank ltd. I tried to show the trend of operation like: deposit, advances, foreign exchange, net profit, admin cost, income and expenditure, reserve fund and their overall position from 2000 to june of 2006 and I have also tried to give some suggestions to improve prevailing shortcoming of the operations of the banks.

1.3

Objective of the study

The objective was to analyze the IFIC Banks overall performance from previous years to half year of 2006 and to find out the weak side and bed side of IFIC Bank on the basis of this analysis and provide some recommendation about how bank can overcome their weak side and some suggestions of how IFIC Bank can improve in future than other competitors. As we all know, in the service sector like that of banks innovative and better customer service ultimately contribute to the overall progress of the organization. Better customer relation and customer satisfactions contribute to banks achieving the market leader position too. I wanted to see how much successful IFIC in this regard.

1.4

Methodology

For the procedure of different banking operation, I have observed the operations and worked with the officers at the same time, I have interviewed of the IFIC Bank officials for getting more information. For the analysis of trend of operation of IFIC Bank ltd. from previous years to half year of 2006, data have been collected from federation branch manager sir and from different statement, annual report, files and document of the branch. Personal experience gained by visiting different desks during internship period and personal interview with branch officials/executives. For gaining in depth knowledge old files and manuals published by IFIC Bank were reviewed. Duration of rotation in different departments in the branch is shown in below:

Duration of rotation of different areas of the branch

35 Duration in days 30 25 20 15 10 5 0 GB Advance For. Ex. Accounts dept.

Department

1.5

Sources of information

Data for my topic was collected from various sources. First of all I have talked with my branch manager(federation branch). Manager sir provide me current information on my topic and also discussed with me about my topic related information. The main purpose of collection of data is to compare the operational position of IFIC Bank ltd. from 2000 to 2005 I have collected information from IFIC library. There Mr. Shahabuddin sheikh(library in charge) helped me to collect my topic related data. I also collect data from annual report 2002,2003 of IFIC Bank ltd. and from current manual. I also explored the pages financial magazines(local) in order to find out the current position of IFIC Bank ltd. and also to find out real life case study on bank & banking which is aimed at customer satisfaction.

1.6

Scope of the study

IFIC Bank ltd. is one of the leading bank in Bangladesh. The scope of the study is limited to the federation branch only. It was not possible to go all branches of the bank. The report covers the background, overall banking activities and performance of the banking activities.

1.7

Limitation of the study

There were limitation too. The flow of my work was hampered for a short time because my departmental requirement was to submit the report within one month. So within this short time I can not able to collect complete data on my topic and some data /information I can not collect for banks internal restrictions. Besides the truth is that, my topic is too broad to engulf within a shortly span of time.

Chapter- Two

Background of the IFIC Bank ltd.

2.1 2.2 2.3 2.4 2.5 The Bank in a sketch Ownership structure Composition of the board Capital & reserve Mission statement

2.1

The Bank in a Sketch

International Finance Investment and Commerce Bank Limited (IFIC Bank Ltd) is a banking company incorporated in the people,s republic of Bangladesh with limited liability. It was set up at the instance of the government in 1976 as a joint venture between the govt. of Bangladesh and sponsors in the private sector with the objective of working as a finance company within the country and setting up joint venture banks/financial institutions abroad. The govt. held 49% shares and the rest 51% were held by the sponsors and general public. In 1983 when the govt. allowed banks in the private sector IFIC was converted into full-fledged commercial banks.
2.2

Ownership structure

The govt. of the people,s republic of Bangladesh now holds 35% of share capital of the bank. L industrialists of the country having vast experience in the field of trade and commerce own 34% of the shar capital and the rest is held by the general public.

2.3

Composition of the board

unlike other banks in the private sector, Board of directors of the banks is a unique combination o private and govt. sector experience. Currently it consists of 13 directors. Of them 8 represent the sponsors a general public and 4 senior officials in the rank and status of joint secretary/additional secretary represent th government. Managing director is the ex- officio director of the board.

Executives of the Bank

Managing Director

Deputy Managing Director

Senior Executive Vice President

Executive Vice President

Senior Vice President

Vice President

First Vice President

2.4

Capital and reserves

IFIC Bank has been consistently maintaining the capital adequacy ratio, as prescribed by Bangladesh Bank. This has been made possible by a policy of building up both capital & reserves. It started with an authorized and paid-up capital of Tk. 100 million and Tk. 63.20 million respectively in 1983. Authorized and paid-up capital increased to Tk. 500 million and Tk. 406.39 million respectively in 2005.

2.5

Mission statement

The mission of IFIC Bank ltd is to provide service to our clients with the help of a skilled and dedicated workforce whose creative talents, innovative actions and competitive edge make our position unique in giving quality service to all institutions and individuals that we care for. We are committed to the welfare and economic prosperity to the people and the community, for we drive from them our inspiration and drive for onward progress tom prosperity. We want to be the leader among banks in Bangladesh and make our indelible mark as an active partner in regional banking operating beyond the national boundary. In an intensely competitive and complex financial and business environment, we particularly focus on growth and profitability of all concerned.

Chapter- Three Banking operation of IFIC Bank Ltd.

3.1
3.2 3.3

General Banking Advance/Credit & Foreign trade and exchange.

General Banking

Introduction During my practical orientation I was placed in IFIC Bank Limited. First I was placed in Federation Branch. I have completed General Banking and some exposure in Advance in this branch. General Banking is the starting point and main function of all the banking operations it is the department which provides day-to-day service to the customers. Everyday it collects deposit from the customers by allowing broking interest rate, meets their demand for cash by honoring Cheques and lend it to the customers against ending interest rate. Lending interest rate in higher than borrowing interest rate, this is the profit for the bank.

Functions of this department This department maintains following functions. Accounts opening section. Cash section Remittance section. Clearing section. Accounts section. Establishment.

Accounts Opening Section This section opens different types of account for their valued customers. Selection of customer is very important for the bank because banks success and failure largely depends on their customers. If customers are bad they creates fraud and forgery by their account with bank and, this destroys the good will of the banks. So, this section takes extreme caution in selecting its valued customer.

Types of Accounts Accounts can be classified into two types: Operative Account Non-Operative Accounts PSS AlC Current Deposit Account MIS A/C Savings Deposit Account FDR AlC SOD AlC

STD AlC

Operational Nature of Accounts

Current Deposit Accounts (CD account) - A current account may be opened by any individual, firm, company,

club, associates, etc. Bank: may, however, refuse without assigning any reasons to open current account to any body. - Minimum balance of Tk. 5000 while open. - No current account will be opened with Cheques. - Fund in the current deposit account shall be payable on demand. - Minimum balance to be maintained of Tk. 1000. - If minimum balance falls then incidental charges of Tk. 50 will be realized half is early. - No interest is payable on the balance of CD.

- In case of closing of current account Tk. 100 is to be realized against incidental charges.
Saving Deposit Accounts (SB account)
- 6.00% interest is provided to depositors. - The minimum amount of balance to be maintained with this type of account is Tk. 2000 - A depositor can withdraw two times in a week for more withdrawal depositors are not entitled for any interest. - To withdraw above Tk. 20,000 the depositors has to notice. - No savings account will be allowed to be overdrawn.

Short term deposit (STD A/C)

..

Generally opened by big business firm.

5.5% for more than

- Interest depends on the amount deposited. - Minimum amount of balance has to be maintained with STD account is Tk 2 lacs, while open

- Interest is given at a rate of 4.5%( for less than Tk. 1 crore, 5% for more than 1 crore,
5 crore, 6% for more than 10 crore and 2.5% for bank to bank)

- Minimum amount is Tk 5000 must be maintained. Pension Savings Scheme (PSS) - This is a scheme to make the customer introduced to the banking system under this schemes the customers
are to pay a certain of money at monthly interval up to a period of 3 to 5 years and after the period they will get the returns along with the full interest earned during the period and the principal amount. Most of the clients under this scheme are middle class and lower middle class people

- Generally opened by small sever.

- Minimum Amount Tk 500 and maximum Tk 5000

- Interest rate 8% for 3 years maturity and 7.5% for 5 years maturity period.
- Maturity 3 to 5 years.

PSS:

3 Years term

5 Years term

Monthly installment Tk. 500 Tk. 1000 Tk. 2000 Tk. 5000 Liquidation of PSS

Amount payable after maturity 8% Tk. 20322 Tk. 40645 Tk. 81290 Tk. 203225

Monthly installment Tk. 500 Tk. 1000 Tk. 2000 Tk. 5000

Amount payable after maturity 7.5% Tk. 36266 Tk. 72532 Tk. 145064 Tk. 362661

- In case of premature encashment if the period is below 1 year then no interest will be provide.
- ff above 1 year interest will be given @ Savings.

Fixed Deposit Reserve (FDR)

- FDR is neither transferable nor negotiable.

- It can be opened by all. - Provided 6.50% - 11.50% interest. - Interest rate very on principal amount. - The deposited principal amounts have not fixed by the Bank. - One can deposit any sum of amount under fixed deposit reserve. - In case of with drawl before maturity the previous maturity period is considered to pa: interest according to savings interest rate 6.5% it is known as pre matured en-casement.

Interest rate have been rated by the Management of IFIC Bank on FDR have given below Maturity period Amount 3 months Less than 1 crore Tk. 1 crore or above 6 months 6 months & above but less than 1 year Tenure 1 year Less than Tk 1 crore, Tk. 1 crore and above Less than Tk. 1 crore, Tk. 1 crore and above Less than Tk 1 crore, Tk. 1 crore and above Rate of interest 6.5% 7.5% 10.50%

11.00% 11.50%

Liquidation of FDR - Only the account holder himself and the authorized person can liquid the FDR after maturity. - In case of joint name authentication from both is necessary. - If demand before maturity the last expired duration is considered to pay interest. Account opening process Step l- Receiving filled up application in bank's prescribed form mentioning what type of account is desired to be opened. Stop 2- The form is filled up by the applicant. Step 3-Two copies of passport sized photographs for individual and in case of firm's photographs of all partners are necessary. Step 4-Applicant must submit required document. Step 5-Applicant must sign specimen signature sheet and give mandate. Step 6-Introducer's signature and accounts number verified. Step 7- Authorized officer accepts the application Step 8- Minimum balance is deposited only cash is acceptable. Step 9- Account is opened and deposit slip and a cheque book has given.

Account Opening Procedure in a flow chart:

Applicant fills up the relevant application form in the prescribed manner.

He/she is required to fill up the specimen signature card

For individual introduction is needed by an account holder

Account is opened

The authorized officer scrutinizes the introduction and examine the documents submit

After depositing the cash one cheque book is issued

Issuance of deposit slip and the deposit must be made in cash. No cheque or draft is acceptable to the Bank

Issuing Cheque books to the customers The bank issues 10 leaves cheque book for savings account and 20, 50 and 100 leaves cheque books for current account. To complete the issuing of cheque books a customer has to fill up the requisition form for cheque books. Then a new cheque book will be filled up by the account number of the customer. The requisition slips are maintained and recorded in a register as voucher. Dormant account If any account is inoperative for more then one year is called dormant account. To operate this accounts manager's permission is necessary. Transfer of Account Account holder may transfer his account from one branch to another branch. For this he must apply to the manager of the branch where he is maintaining his account. Then the manager sends a request to the manager of the branch where the account holder wants to transfer his account for opening the account.

Closing of Account To close an account parties may be request to send an application along with the unused leaves of the cheque book. On receipt of the application the following steps are taken. i) The signature of the account holder is verified. ii) The number of the unused cheque leaves shall be noted therefore. iii) Debiting the incidental charges to the account. iv) The account holder is advised to draw the remaining balance.

Kinds of Account Holders Branch may open accounts of the following categories of depositors: 1) Individuals - Individuals are adult persons of 18 years age or more who are competent to enter into contracts. 2) Joint accounts - More than one adults jointly or adult with minor(s) may constitute joint accounts. 3) Sole Proprietorship concern - A business trading concern owned by a single adult person is sole proprietorship concern. 4) Partnership firms - A business concern owned and managed by more than one persons which may be registered or not registered is a partnership firm. 5) Private limited - A body corporate formed and registered under companies Act 1994, with limited members. 6) Public limited - A body corporate formed & registered under companies Act 1994 with limited liability of the shareholders and with no upper ceiling of shareholding both certificate of incorporation and certificate of commencement has given by registrar. 7) Trusts - Trusts are created by trust deed in accordance with the law. 8) Liquidators - Liquidators are appointed by court of law for companies going into liquidation. 9) Executors - Executors are appointed by a deceased himself before his death by "with" to settle the accounts of the person after his death. 10) Club/Associations/Societies - There are organizations created & registered or not registered under societies registration act. 11) Co-operatives - There are corporate bodies registered under societies registration Act or companies Act or the co-operative societies Act. 12) Non-Govt. Organization - NGOs are voluntary organizations created & registered and society's registration Act or co-operative societies Act. 13) Non-Trading concern - These are organization registered under societies registration Act or companies Act or co-operative societies Act.

Cash Section Cash department is the most vital and sensitive organ of a branch as it deals with all kinds of cash transactions. This department starts the day with cash in vault. Each day some cash i.e. opening cash balance are transferred to the cash officers from the cash vault. Net figure of this cash receipts and payments are added to the opening cash balance. The figure is called closing balance. This closing balance is then added to the vault. And this is the final cash balance figure for the bank at the end of any particular day. Functions of cash department -Cash payment -Cheque cancellation process -Cash receipt

 Cash payment Cash payment is made only against cheque. This is the unique functions of the backing system which is known as "payment on demand" . It makes payment only against its printed valid cheque. Cheque cancellation process Receiving cheque by the employee in the cash counter and verification of the following by the cash officer in the computer section: i) Date of the cheque. (it is presented within 6 month from issue date) ii) Issued from this branch. iii) An amount in figure and in word does not differ. iv) Cheque is not torn or mutilated. Then gives pay cash seal and sends to the payment counter and payment office makes payment. Cash receipt . Another important function of this department is receipt of cash. Depositors deposit money in the account through this section by deposit slip. i) It receives deposit from depositors in the form of cash. ii) So it is the "mobilization unit" of the banking system. iii) It collects money only its receipts from. iv) It receives cash for issuing pay order TT, DD. Books maintained by this section: i) Vault register: It keeps accounts of cash balance in vault at the bank. ii) Cash receipt register: Cash receipt in whole of the day is recorded here. iii) Cash payment register: Cash payments are made in a day are entries here. iv) Rough vault register: Cash collection for final entry in vault registers done here, as any error and correction is not acceptable. v) Cash balance book: Balance here is compared with vault register. If no deference is found, indicate no error and omission.

Local Remittance Sending money from one place to another place for the customer is another important service of the bank. This service is an important part of transaction system. In this service system, people, especially businessman can transfer funds from one place to another place easily. There are three kinds of technique for remitting money from one place to another these are: -Demand draft (DD) -Pay order (PO) -Telegraphic Transfer (TT)

Demand Draft (DD)

DD is an order of issuing branch on another branch of the same bank to pay specified sum of money to payee on demand. It is generally issued when customer wants to remit money in any place i.e. outside or the clearing house area of issuing branch. Payee can be the purchaser himself or another mentioned in the DD. It is safe technique of transferring money from one place to another.

Payment process of the paying bank: -Test confirmation if the DD value is more then Tk. 25,000.00 -Confirm that the DD is not forged one. -Confirm with sent advice. -Make payment.

Commission and charges of DD: Postal charge Tk. 15.00 + commission 0.1% + 15% Vat on commission. No telex charge. How DD Works :

The applicant should have A/C with IFIC

Applicant fills up the relevant form with a credit voucher (income A/C) for the Bank

DD is handed to the customer where paying Bank is mentioned and payment will be made from another Bank

An IBCA along with photocopy of DD is sent to the paying Bank (An advice to paying Banker)

If DD comes to the Bank on which it is drawn, the Bank honors it.

Cancellation of DD: Step - I : Application is writing to the manager of the account maintaining branch. Step - 2 : Verification of specimen signature. Step - 3 : Journal posting for incoming: -Bills payable DD payable Dr. - IFIC General AIC Cr

Step - 4 :

Journal posting for outgoing: -IFIC general A/C -Party A/C Send a letter to paying bank

Dr. Cr.

Pay Order (P.O) Pay order gives the right to claim from the issuing bank. A payment is an instrument from one branch to the another branch of the bank to pay a specific sum of money. Unlike cheque there is no possibility of dishonoring because before issuing pay order the bank takes money in advance. There are three reasons behind use of P.O: Remitting Purpose Advice to Pay Payment against bill submitted to the bank.

Pay Order consists of three parties: - Beneficiary - Applicant - Counter Part.

Commission and charges of P.O: Amount of P.O Up to TK. 100,000 100,001 to 500,000 Above 500,000 Commission on Remittance 25 50 100 15% VAT on Commission 4 8 25

Payment Process of Paying Bank: Payment is made through clearing.

Payment of Pay Order : An the PO issued by the bank is crossed one it is not paid over the counter. On the contrary the amount is transferred to the payees account. To transfer the amount the payee must duly stamp the PO.
Payment is given and is registered in incoming payment of P.O Book.

The payee deposits it to his Collecting Banker

Collecting Bank sends the P.O. to the issuing Bank through clearing house arrangement

The Pay Order is passed and cancelled in the deposit section.

Cancellation of P. 0: Step-I: Application writes to the manager of the account maintaining branch. Verification of specimen signature. Step-2:

Encasement of P.O: To encashment of that P.O. the payee of the instrument deposits the P.O. to his bank. The bank sends the pay order to the issuing bank through clearing. Then the P. O. is passed through the deposit section and the P. O. is send back to the clearing house again and later the amount of P.O. credited to payees account. Flow Chart of P.O.-How It Works :
He purchased the P.O. in favor of a person or company

Purchaser has an account

with IFIC and fill up the relevant from with a credit voucher

Collecting Banker sends an IBDA

If any A/C with IFIC BANK(the collecting Banker)

The beneficiary deposits the PO in his account with IFIC or another Bank

Payees account is credited with collecting Banker

The collecting Banker presents the PO to paying Banker through clearing house

Payees account credited with collecting Banker

Telegraphic Transfer (TT) Issuing branch requests to another branch to pay specified sum of money to a specific person on demand by telegraph or telex or telephone. Transfer of fund by TT is the rapid and Convenient but expensive method.

TT (Issue): Customer fills up the TT form and pays the amount along with commission in cash or by cheque. The respected officer issues a cost memo after receiving the TT form with payment seal, then sign it and at last give it to the customer. Next a TT confirmation slip is issued and its entry is given in the TT issue register. A test number is also put on the face of the slip. Two authorized officer signs this slip. The respective officer transfers the message to the drawee branch mentioning the amount, name of the payee, name of the issuing branch, date, test number and his her power of attorney (P.A.) number. The confirmation slip is send by post.

How TT Works (Outward) :

Applicant has an account with IFIC Bank

Applicant fills up the relevant form with a credit voucher (Income A/C) for the Bank

Text of telex is written or the relevant information along with Test code is sent to the payee Bank through fax or telephone

Another 2 copies of the text are sent through courier to the Payees Bank.

The reconciliation departments reconcile two copies and detect the fraud or forgery if any

Then one copy from drawers Bank and another from Payees Bank are sent to the reconciliation department of local office.

Before that the Payees Bank decode the test and if test is agreed

Payees account credited

Payment Process of TT: Step-I: Test confirmation Step-2: Confirm issuing branch Step-3: Confirm payee's account. Step-4: Confirm amount Step-5: Make payment Step-6: Advice sends to the Head Office for reconciliation.

Commission and Charges of TT: - Telephone or Telex charge TK.30. - .1% Commission of Principal amount. - 15% VAT on commission. Entry for TT a) On Issuing of TT : 1. Cash / Respective A/C (issuer) -------------- Dr. IFIC BANKGeneral A/C ---------------------------- Cr. (Principal amount) Income A/C-postage -------------------------- -------Cr. Income A/C-Commission on TT ---------------- --Cr. IFIC BANKGeneral A/C -------------------------- Dr. Bills Payable A/C-TT Payable ------------------- Cr. b) On Payment of TT

2.

Bills Payable A/C TT Payable ---------------------- Dr. Party A/C --------------------------------------- Cr. Test Arrangement of TT & DD Test is the security code by decoding which any branch can be sure that the TT or DD is not forged one. Only the authorized officers know the test code. Each bank maintains secret code for this. That is the test arrangement is the combination of different secret codes.

Clearing Section This section receives all kinds of cheque in favor of the valued client for clearing on the part of their banking services. After receiving cheque it is necessary to endorse it and cross it specially. Clearing of cheque is done through the clearing house in Bangladesh Bank. - 1 st clearing - 2nd clearing

Types of cheque for clearing There are four types of cheque for clearing: 1) Inward clearing cheque. 2) Outward clearing cheque. 3) Inward bills for collection. 4) Outward bills for collection. Inward clearing cheque It refers the instruments drawn on IFIC bank received by other banks in the clearing house from the representative of other bank. Outward bills for collection When our branch sends Cheques to other branch ofIFIC bank is called OBC. Accounting treatment of this process: IFIC general (Sender's Branch) Dr. Depositor's A/C Cr. Inward bills for collection (lEC) There are two types of clearing, firstly cheque collects from the other branch of IFIC banle These Cheques are settled by sending mCA i.e. debiting depositors account and crediting sender's branch account. . Secondly cheque collects from another bank outside the clearing house. These cheque are settled debiting depositors account and sending DD or TT in favor of senders bank. Outward Clearing Cheque Cheque drawn of another branch of IFIC bank are called Outward Clearing Cheque. These types of cheque are directly sent to the respective branch and request them to send IBCA.

Accounts section This is obviously an independent and unique department, which works as the composition of all the departments of the branch. This section is fully computerized. So the conventional large ledger and journal books are not kept like the some nationalized bank. It receives the vouchers from all departments and prepares the subsidiaries and maintains accounts.

Establishment section This section deals with employees salary, many types of internal expenses such as purchases of stationary, equipment, machinery, payment of labor cost and convince. In case of leave of absence employee collects prescribed form from this section.

ICC: Internal control and compliance department. This department check all the activities as per requirements of Bangladesh Bank.

Locker facilities Locker facility is available in this branch. Generally people keep their valuable ornaments in the locker. Lockers are three sizes one are small and other are middle and big. If any body want to open a locker s/he has to pay rent Tk. 1800 for big size, Tk. 2500 for large and Tk.1200 for small size annually. Any individual can open a locker.

3.2 Introduction

Loans & Advances

This is the survival unit of a bank because until and unless the success of this section is a question to every bank. If this section is not properly working, the bank it self may become bankrupt. This is important because this is the earning unit of the bank. Banks are accepting deposits from the depositors in condition of providing interest to them as well as safe keeping their deposits. Now the question may gradually arise how the bank will provide interest to the clients and the simple answer is advance. We often use loans and advances as an alternative to one another. But academically this concept is incorrect. Advance is the combination of such items where loan is a part only for this credit section of the bank. Types of Advance All loan and advance that are provided by this bank can be categorized into there heads according to the nature and characteristics of each product:

ADVANCE

Continuous Loan

Term Loan

Loan General

Figure shows the different types of advances

Nature of Different Types of Advance Cash Credit HYPOTHECATION (CC HYPO) Cash credit is given through the cash credit account. Cash credit is an active and running account where deposit and withdrawals may be made frequently. The debit balance of the account on any day can not exceed the agreed limit. Instrument HYPOTHECATION DEED. 50% margin requires to open a CC account. (varies) Operation of cash credit is same as that of overdraft the purpose of cash credit is to meet working capital needs of traders, farmers, and industrialist. It is granted only the first class parties. It is charged against a property where neither the ownership nor the possession is passed to the bank. Cash Credit PLEDGE The nature, operational work, and characteristics of CC- PLEDGE in as same as CCHYPO. CC.PLEDGE in different from CC-HYPO only from the securities or business goods against the loan amount. It is charged against properties where the ownership may remain to the borrower but the possession is passed to the bank. Instrument - Pledge Deed. Secured Overdraft (SOD) Overdrafts are those drawings, which are allowed by the banks in excess of the balance in the current account up to a specified amount for definite period as arranged for. Generally it is given to the businessmen to increase their business activities. Usually provide against FDR, PSS, i.e. financial obligation or any primary securities. The interest charges from the date of first withdraw. Interest is calculated and charged only on the actual debit balance on daily product basis. Balance of OD account are fluctuates The interest rate of SOD is 3% above of FDR interest rate if the FDR is in our Bank. If the FDR is in other bank then the interest rate is 14.50%

Industries Loan It is a term loan. It is given for three (3) years at equal installment. Grass period is allowed of this types of loan. Grass period is the period that require to earn visible returns. Others loan Loan provided for other purpose which is productive and less risk rather industrial sector are treated as others loan. The terms and conditions of these types of loan are same as industry loan. House Building Loan This loan is give for the construction of building house. It is gives for three (3) years at equal monthly installment. This loan is not provides frequently. Staff House Building Loan (SHBL) 120 times of BASIC salary is provided as SHBL. Bank rate + 1 % interest is charged to the loan amount. Repaymeilt adjusted from their monthly salary. Repayment is made at equal monthly installment. Consumes Credit Scheme Under this scheme credit is given to the customer to purchase necessary and luxury commodities like computer, motor vehicle, television, refrigerator, music system sewing machine, furniture etc. Other then the employee it is given to the valuable client. It is a 24,36,48 installment system @ 15.50% interest. Stuff loan against Provident Fund (SLPF) 10% of basic in contributed by employee Repayment is adjusted from their on they salary. Maximum sanction from PF. Loan against PSS This loan is provides against PSS fund. 80% are given of the PSS fund. This is 100% secured for the bank.

Payment Against Document (PAD) The importers are to open letter of credit through any bank for importing goods. Most of the time they are to extend credit to the importers if not prohibited by Bangladesh bank. This loan creates, on receipt of shipping documents from the negotiating bank, is transferred and lodged to PAD. PAD is associated with import and import financing. The bank opening letter of credit is bound to honor its commitment to pass for import bills when these are presented for payment provided that it is drawn strictly in terms of the letter of credit, in fact the amount their sends advanced on behalf of the importer. Loan against imported Merchandise (LIM) In many cases, a bank has to clear the goods imported under letter of credit at the request of the borrower. When the importer does not come forward to retire the documents inspire of repeated reminders bank has on forced circumstances to clear the imported consignment on arrival of the same to avoid demurrage at the port which adds to the burden of commitment. When the importer fails to retire the documents or request for clearance of goods, the outstanding under PAD is transferred to LIM account. After clearance, consignments are taken delivery by the importer on full payment of bank's liability. Normally part delivery is not allowed while on LIM A/C. when the delivery in part is desired by the importer, the LIM is converted into cash credit account retaining proper margin and executing charge documents, the delivery is effected themselves on obtaining pro rate payment. Trust Receipts (TR) This is an arrangement under which credit is allowed against trust receipts and imported or exportable goods remain in the custody of the importer or exporter but he is to execute a stamped trust receipt in favor of the bank where a declaration is made that goods imported or bought with the bank's financial assistance are held by him in trust for the bank. . Export Cash Credit (ECC) ECC are extended to an export to facilitate the export of goods & commodities for which there is export letter of credit or contract on hand. It is a pre-shipment & short term credit to be liquidated out of the proceeds of export documents which include negotiation or purchase of export documents.

Securities against Advances The following securities are to be obtained by the branches depending on the nature of advances while allowing secured advances to the parties. - Pratirakshya Sanchay Patra, Bangladesh Sanchay Patra, ICB unit certificates, Wage Earner Development Bond - Fixed Deposit Receipt issued by any branch of IFIC Bank Limited. - Shares quoted in the Dhaka Stock Exchange Limited - Pledge of goods and produce - Hypothecation of goods, produce and machinery - Immovable property - Fixed assets of a manufacturing unit Cheques, Drafts, Pay Order, Railway Receipts, Steamer Receipts, Burge Receipts of the Govt. or Corporations Shipping document Which Advances Against Which Securities All securities are not suitable for all types of advances. Each security has its own suitability. Specific securities to be obtained by the branches while allowing advance are shown below against the types of advances: Types of advances Loans Securities Lien of various kinds of Sanchay Patras, Govt. Securities, and Shares quoted in the Stock Exchange, Debentures, Fixed Deposit Receipts, Pledge of gold/Gold ornaments, hypothecation of vehicles. Collateral of immovable properties. Sanchay Patra, Non-resident for deposit (NFCD), shares, debt. Promissory notes, fixed deposit, insurance policies, gold etc. Pledge or hypothecation of stock, produced merchandise. The bill itself. Shipping document for imports. Pledge of imported merchandise. Trust receipt obtained in lieu of trustees. Pledge or hypothecation of goods receipts. Shipping document for exports.

Overdraft Cash Credits Inland bills purchase (IBP) PAD IM TR

ECC
Foreign Bills Purchase

Process of Loan Sanction Step-1 : Sanctioning by the competent authority A secured advance may be grant to a party only after getting a limit sectioned from the competent authority. Step-2 : Loan/Advance Proposal For obtaining a loan/advance the party must make an application in standard form in writing to the branch where he maintains his operative account. After receiving the application from the party, the branch manager will take immediate steps to compile report regarding the party based on the following sources of information: Step-3 : Personal investigation Confidential supports from Other banks, Chamber of commerce CIB from Bangladesh bank as the earnable. Treading account P/C, B/S. M/A if' any and other documents submitted by the party. The average balance and the present maintained in the account. The nature of operations during the last six months and the date of opening account.

Preparation of limit proposals The branch, may prepare a limit proposal after being fully satisfied with the following points: The financial position of the party. Purpose for which advance is required. Nature of securities offered. The payment arrangement.

Step-4 Step-5

: :

Renewal Proposal. Approval by Head Office and Branch responsible. Limit proposal sent to HO. Sanction/reject Receive the limit section advice.

Step-6 Step-7

: :

Disbursement of loan. Loan monitoring and administration.

Classification of Loan (CL)

Advance may classified or unclassified are determine on the basis of regularity of loan recovery. ASSESSMENT OF LOAN & ADVANCE CLASIFIED (IRREGULAR)

CLASSIFIED
(IRREGULAR)

UNCLASSIFIED
(REGULAR)

SUBSTANDARD DOUBTFUL

BAD LOAN

Figure: Shows the Classification or 1oan

Unclassified Loan: the repayment of advance which have regularity are called unc1assifiec advance. This is a clean loan that is these is no overdue installment or not the expire due date. Classified: The repayments of advance which have no regularity are classified. That means which are irregular in nature, overdue installment of payment, and expire the due date. There are three standards of classification: - Sub Standard - Doubtful - Bad Loan

Eligible security - For land and building 50%. - Financial obligation 100%. Interest suspense

- Total balance of interest against classified loan.

Base for provision - Formula: Outstanding - Interest surpasses - Eligible security - In case of unclassified advance the base for provision should kept 1 % of the total outstanding amount. - In case of bad loan the base for provision should kept 100% of the total outstanding amount

- In case of doubtful loan the base for provision should kept 50% of the total
outstanding amount. - In case of sub standards loan the base for provision should kept 20% the total outstanding amount. Basically this standards of classification are depends on the expansion of time. There are separate systems of classification for each type of loan. Each banking institution have develop there own system of loan classification.

Credit Risk Analysis (CRG) CRG is the combination of analysis of various types of risks that may occur while a loan have sanctioned. This is an analysis of the measurement of performance of a company or individuals. When a loan have been provided by the bank then all types of risks have to calculate. This is not easy to express all the pros and corns of CRG are not possible in this report. Before sanctioning a loan it is necessary to analyze the CRG. IFIC Bank has formatted this analysis which contains several sheets of analysis to identify the strength and weakness and the repayment probability of the lending.

Chapter - Four

Performance Analysis of IFIC Bank Ltd.

Performance analysis of IFIC Bank Ltd.

1. 2.

Authorized Capital is 500.00 Million (in Taka). Paid up Capital is 406.39 Million ( in Taka).

3.

Reserve & surplus position from 2000 to 2005: Table Graph

Year 2000 2001 2002 2003 2004 2005

Amount (million in Taka) 559.60 622.53 672.79 737.19 809.10 954.66

1200 Taka in million 1000 800 600 400 200 0

Reserve& surplus position

2000

2001

2002

2003

2004

2005

Year

From the table & graph showing that, reserve & surplus position of the IFIC Bank Ltd. is good because it is gradually increasing. Bank has a capital & reserve of Taka. 175.00 crore with an excess of taka 4.06 crore as of May 2006. Although there is an excess capital of taka 4.06 crore, this is not enough because they have already a commitment of taka 150.00 crore daily approved by the board to be disbursed over the next few months. 4. Business performance of the Bank deposit from 2000 to 2005: Table Amount(million in taka) 16577.52 17616.69 19131.85 19798.97 20774.47 22505.20

Year 2000 2001 2002 2003 2004 2005

Graph showing the deposit position of IFIC Bank Ltd.

Deposit position
25000 Million in taka 20000 15000 10000 5000 0 2000 2001 2002 2003 2004 2005 Year

From the graph we see that, deposit volume of IFIC Bank Ltd. is continuously increasing. The deposit amount was tk. 16577 in 2000 and 22505 million tk. Was in 2005. The Banks yearly deposit target in 2006 is 2600.00 crore taka. 5. Credit position of IFIC Bank Ltd. from 2000 to 2005: Table Year 2000 2001 2002 2003 2004 2005 Amount( million in taka) 17312 18189 20596 20450 21280 21694

Graph showing the credit position of IFIC Bank Ltd.

Credit position

21694

17312 2000 18189 2001 2002 2003 2004 2005 20596

21280

20450

From the above graph we have seen that, From 2000 to 2002 credit sanction amount is increased, but in 2003 it was fall and it again increase from 2003. The half yearly advance target was 2364.74 crore taka and banks achievement was 2402.89. The banks yearly credit target in 2006 is 2500.00 crore taka.

6. comparison of Deposit & credit of IFIC Bank Ltd.

Table Year Deposit Credit 2000 16577 17312 2001 17616 18189 2002 19131 20596 2003 19798 20450 2004 20774 21280 2005 22505 21694

Graph showing the comparison of Deposit & credit position of IFIC Bank Ltd.

Comparison of Deposit & credit position.

25000 20000 Million in taka 15000 10000 5000 0 2000 2001 2002 2003 2004 2005 year DEPOSIT CREDIT

The comparison is showing that the growth of credit is little faster than growth of deposit from 2000 to 2004 but In 2005 growth of deposit was more than credit.

7. Foreign exchange business:

Table showing the Import & export business: Year Import 2000 17939 2001 17410 2002 19407 2003 25412

(In million taka) 2004 24785 2005 26629

Export

19711

19432

21718

24190

29534

33698

Graph showing the import & export business:

Import & export Business

40000 35000 Million in taka 30000 25000 20000 15000 10000 5000 0 2000 2001 2002 2003 2004 2005 Year Import Export

we see that, IFIC Bank,s export business is greater than import business but in 2003 import business was greater than export business. The IFIC Bank foreign-exchange business target in 2006 is 7200.00 crore taka. Till june IFIC Bank Ltd. achieved 4272.55 crore taka from export-import business.

8.

Income & expenditure position of IFIC Bank Ltd.:

The income & expenditure position is given below, we see that, total income of IFIC Bank Ltd. is gradually increase and expenditure also increase. Total income in 2005 was 2055 million taka and total expenditure was 2065 million taka in 2005

The total income till june 2006 was 168.19 crore and total expenditure was 125.85 crore taka.

Table & Graph showing the income & expenditure of IFIC Bank Ltd. (In million Taka)

Income & Expenditure position

3000 Million in taka 2000 1000 0 Income

Income Expenditure

2000 1874

2001 2173 1925

2002 2136 1986

2003 2543 1921

2004 2687 1986

2005 2655 2065

Expenditure 1631

Year

9.

Net profit(gross profit):

Table Year Net profit 2000 157 2001 161 2002 79 2003 64

(In million taka) 2004 71 2005 82

From the above table we see that, net profit after tax of IFIC Bank was 157 million taka in 2000 and it gradually decreased from 2000 to 2004 but in 2005 net profit was again increased in 82 million taka.

Graph showing the Net profit of IFIC Bank Ltd.

Net profit of IFIC Bank Ltd.

180 160 140 120 100 80 60 40 20 0 2000 2001 2002 2003 2004 2005 Year

In million taka

Net profit

Total operating profit till june 2006 was 42.34 crore taka and Banks profit target till December 2006 is 100.00 crore taka.

10.

Guarantee Business outstanding:

The IFIC Bank Ltd. is holding a large volume of guarantee business. Table showing the data of guarantee business outstanding: Year Guarantee Business 2000 1656 2001 1323 2002 2098 2003 2206 2004 1266 2005 2688

Graph showing the guarantee business outstanding of IFIC Bank Ltd.

Guarantee Business of IFIC Baank Ltd.

3000 2500 IN Million Taka 2000 1500 1000 500 0 Year Guarantee Business

From the graph we see that, guarantee business was tk. 1656 million in 2000 but in 2001 it was fall in tk. 1323 million. From 2002 to 2003 it increased to tk. 2206 million but in 2004 it was fall again and in 2005 it become 2688 million tk. From 1266 million tk. So I can say that, guarantee business is not constant. It is unexpectedly ups and down.

11. 12. 13. 14.

Number of employees in IFIC Bank Ltd. was 1990 till 2005. Number of Branches of IFIC Bank Ltd. is 65. The administration cost of IFIC Bank Ltd. is 3.70%. It is higher then other The recovery position is : Its half yearly target was 55.00 crore taka till june 2006 but it achieved 22.32 crore taka. and yearly target is 110.00 crore taka till December 2006. banks.

15.

IFIC Bank Ltd. investment amount was 406.54 crore taka in the market as on june 2006.

16. Its liquidity position is it has excess liquidity of 305.00 taka. which bank can not deploy for profitable investment despite ample opportunities in the market.

SOWT ANALYSIS Strength:

Well trained and qualified manpower. Competent management and dynamic director Sound liquidity position More than required provisioning against the classified advances, plus 1% general provision on loans and advances. High commitment of customer & qualified & experience resource Too much classified loan being carried over Higher rate of interest

Weakness:

 Opportunity:

Traditional banking in most suburban branches Dependence on unripe software in most urban branches Prevalent bureaucracy Lack of strong internet banking The bank can always look forward to a bright future with its well trained manpower The experience, skill, compatibility of its management and the directors may always come to a great help to a bank Growing business in the south Asian region More business personal like MBAs are available in the country. They can be picked with due remuneration Provision against classified and unclassified loans being adequate, IFIC can concentrate its development.

Threats: Growing employee turnover may cause financial & image loss Unique software that runs on trial & error basis can seriously hamper the day to day processing of the branches Increased competition in the overall banking sector may cause profit to plummet. Lack of competitiveness in product & service innovation Lack of transparency and excessive bureaucracy may impede the future prospect

Chapter- Five
4.1 Findings & Recommendation 4.2 Conclusion 4.3 Bibliography & Appendix

FINDINGS

@ Hopefully the management decided to provide fully computerized services that will booster services of the bank. @ When a joint stock company comes to open an account if the company happens to be an existing one, the banker should demand copies of the balance sheet and profit & loss account, which will reflect the financial growth of the company and its soundness, But in practice companies and the bankers as well don't even bother. @ Few officers of the bank are competent. Even though many of them simply know the working procedure of what they are doing but don't know the philosophy behind doing those and some are inefficient to serve the customer. @ Project loan requires testing of feasibility of project and judging the marketability of the product. It requires infusion of knowledge of both the fields-marketing and banking. But the bank has hardly any person with this kind of ability. @ Officers of the desk, where workload is very high, hardly get the chance to go out for development purpose and always feel that their duties for the organization would not be evaluated unless they can show a good amount of deposit collection against their name. @ Banks administration cost is too high than other banks in the market @ All the branches are not linked on on line banking system. Only 5 branches linked on on-line banking @ Traditional banking system followed in some cases @ Recently management committee is changed so new management board take some development strategy to develop the overall IFIC Bank.

RECOMMENDATION

In order to get competitive advantage and to deliver quality service, top management should try to modify the services. The synergy of dedicated manpower, technology, market opportunity can lead the organization to achieve the goal, a bank must establish and adhere to adequate of loan provision and reserve. IFIC Bank should train up their branch personnel about all sort of information regarding SWIFT and its service. Due to lack of proper knowledge about the operation procedures and services provided to the customers by SWIFT, certain customers are facing problem, as they have to wait for certain tin1e to get service. and sometimes personnel are not being able to operate SWIFT without any confusion. They are not fully independent of handling SWIFT. Official training is the solution to this problem. IFIC Bank should always monitor the performance of its competitors in the field of Foreign Trade. Mercantile Bank Ltd. Standard Bank Ltd. Mutual Trust Bank Ltd. Premier Bank Ltd. First Security Bank Ltd. Eastern Bank Ltd. Bank Asia Ltd. and Dhaka Bank Ltd. and all other private banks are emerging competitors of IFIC Bank. They should continuously strive and try .to introduce new products and services as access card. ATM with future improved quality services. For customer's convenience in Foreign Exchange Department of IFIC Bank Ltd. should provide more personnel to deliver faster services to their honorable customer. It seems to me that day-by-day customers operation is increasing, individual employee has to handle different types of job. But that is pocking a back for an employee. As a result it might be happen any big mistake by the employee and service is also timed consuming and customer has to suffer for this situation. May be it would be the reason for employee's de-motivation as well as the customer's dissatisfaction. IFIC Bank Ltd. should focus on their promotional activities.

 They should also focus on the marketing aspects to let customers know about their products and offerings and more promotion should be given to attract new customer. IFIC Bank Ltd. must develop electronic banking system to moderate the service. Technological advantage of a bank ensuring its competitive edge in the market place can only be achieved by efficient manpower. It is market share to reduce its operating cost and to generate new revenue. Electronic banking system also allows increased access to the financial system by its customers. Bank should reduce their administrative cost. by reducing unnecessary expenses

Few other important factor that should be focused on the development process: @ Evaluate customer's needs from their perspective and explain locally the shortcomings. @ Customer's convenience should receive priority over other. @ Improve office atmosphere to give customers better feeling. @ Time consumed at service level should be minimized at optimum level. @ Use of effective management information systems. @ Use appropriate techniques in evaluating customer need professionally. @ To deliver quality service top management should try to mitigate the gap between customer's expectation and employee's perception.

FEW SUGGESTATIONS

I. The bank can offer to its customer better service if all of its departments are computerized and incorporated under Local Area Network (LAN) II. At the entry position the bank should enroll more expertise people to augment quality services. III. Nowadays-conventional banking concept is outmoded. Now banks are offering more ancillary services like credit card, on line services and many others. IFIC Bank Ltd. should differentiate its services adopting the modern facilities. _IV. Bank is providing both internal and external training for the officers but bank should be scrupulous about the training facilities so that official can implicate this in their job. V. People are very choosy about environment now a day_ so bank premises should be well decorated and IHC Bank Ltd. should look into the matter very seriously. VI. Bank should provide advances towards the true entrepreneur with reconsidering conventional system of security and collateral, moreover, the whole process should be completed within an acceptable time.

CONCLUSION

Form the learning and experience point of view I can say that I really enjoyed my internship period in IFIC Bank Ltd. at Federation Br. from the very first day. I am confident that this 3 (three) months internship program will definitely help me to realize my carrier in the job market. Performance analysis of a bank is not so sufficient to measure and express perfectly within this short time of my internship period. But it is a great opportunity for me to get used to with the operational environment of commercial banking of IFIC Bank. I have tried by soul to incorporate the necessary relevant information in my report. Top management of IFIC should conduct a comprehensive study or survey on the branches performance, its managements performance and the employees performance and their motivation as well. Few loyal committed customer base, lack of modern and effective technology or facilities, not enough skilled employee in some sector, considering all of these very important factors. IFIC Bank should always try to improve their service level in every terms. The marketing department should think freshly about their marketing objectives and practices. Rapid changes can quickly make yesterday's wining strategies out of date. As a developing private bank in Bangladesh, IFIC Bank shouldn't allow their client to get dissatisfied with their service. They have their competitors who actively striving to take the advantages in every side. During the course of my practical orientation I have tried to learn the practical banking to relate it with my theoretical knowledge, what I have gathered and going to acquire from various courses.

BIBLIOGRAPHY
My daily - Daily Notebook, written during the orientation program. IFIC BANK LTD., Working Manual for different department. Annual report 2002, 2003 IFIC BANK LTD.

Business of Banking - Dr. R.M. Debnath. A Text Book on Research Methodology C .R. Kothari

Managerial conference Report- Published by IFIC Bank