Professional Documents
Culture Documents
of Al-Arafah
Sk. Mel.
INTERNSHIP
REPORT
DEPOSIT AND
INVESTMENT
MANAGEMENT
OF
AL-ARAFAH
ISLAMI BANK
LIMITED
PREPARED FOR
DUTTA
PROFESSOR
SCHOOL OF BUSINESS
PREPARED BY
HOSSAIN
10.01.02.01
BBA 25
th
BATCH
SCHOOL OF BUSINESS
DATE OF SUBMISSION
201 4
UNIVERSITY OF SCIENCE
& TECHNOLOCV
LETTER
August 07, 2014
Dr. Dipak Kanti
Professor,
School of
Business
Ahsanullah
University of
Science &
Technology
Subject:
Submission of
Internship
Report.
Dear Sir,
This is my
pleasure
to
present my
internship
report entitled
"Deposit
Management of
Al-Arafah
in Al-Arafah
Islami Bank
Limited,
Sonargaon
Janapath Road
Branch (Plot 30,
Sector
11,
Sonargaon
Janapath
Road, Uttara,
Dhaka-1230)
I believe that
knowledge and
experience
I
gathered during
the
internship
period
will be
helpful in my
future
professional life.
I will be grateful
to you if you
accept the report.
I
will be available
for defense on
this report at any
time.
Your support in
this regard
will be highly
appreciated.
Thanking you.
Sincerely yours
Sk. Md . Maidul
Hossain
ID:
10.01.02.010
25,h
wwm
mmm
wmm
mmm
$mm
mmw
mwm
Page | ii
ACK
NO
WL
EDG
EME
N
T
Bank
Limited,
for
giving
me
the
valuable
opportun
ity
to
do
my
internshi
p
program
and
supporti
ng
me
with
knowled
ge
and
resource
s.
I
am
also
grateful
to
the
entire
Team
Sonarga
on
Janapath
Road
Branch
of AlArafah
Islami
Bank
Limited
as they
had
always
been
there for
me
when I
needed
them the
most.
Their
active
participa
tion to
all
my
question
s,
queries
during
my
internshi
p has
made
this
journey
a true
success.
Especiall
yI
want to
thank
my
organiza
tional
supervis
or Mr.
Rubayet
Ullah,
Khan
(Second
Officer),
Mr.
Tareq
Pathan
(Senior
Executiv
e
Officer),
Page | iii
PR
EF
AC
E
First of
all I
would
like to be
grateful
to the
Almight
y Allah,
the
merciful
& the
benevole
nt
that has
enabled
me to
complete
this
report.
The
internshi
p, a part
of the
academic
disciplin
e, for the
BBA
students
has been
designed
to
acquire
practical
knowled
ge. It is
expected
that the
integrati
on of
knowled
ge in
theories
and
practices
will
enable us
to
become
effective.
Through
this
program,
I have
got the
chance to
acquire
some
experien
ce in a
reputed
bank.
Which is
expected
to
enlighten
my
career.
and
Investme
nt
Manage
ment of
AlArafah
as
subject
matter
for my
internshi
p
program
due to
personal
curiosity
&
interest
to
achieve
some
practical
knowled
ge about
this
sector.
Besides
this
banking
activity
is
much
importan
t for the
economi
c
develop
ment.
Without
bank it's
difficult
to run
financial
activities
or
operation
. So it's
normally
claims a
research
on it for
better
understa
nding at
present.
Finally,
it
is
my
earnest
&
sincere
hope
that
this
report
on
"Deposit
and
Investme
nt
Manage
ment of
AlArafah
Islami
Bank
Limited"
would be
found
useful by
the
individua
ls.
I tried to
make the
report
effective,
informati
ve and
represent
ative.
EXECUTIV E SUMMAR Y
The sixth chapter shows the findings of my study. There I described the condition of deposit
and investment of the bank for last two years. Then I stated some problems I realized about
the bank that need to be fixed for the improvement of deposit and investment related
profitability. Then I briefly presented my
SWOT analysis of AIBL
Page | v
Finally, in the last chapter I stated some recommendations for the improvement of deposit
and investment condition of the bank and then the conclusion has been made.
CONTENTS
Page
Letter of Transmittal
Acknowledgements
Preface
Executive Summary
Chapter 1:
INTRODUCTIO
N
Introduction
Origin of the Report
Statement of the Issue
Objectives of the
Study
Significance of the
Study
Methodology of the
Study
Limitations of the
Study
Chapter 2:
COMPANY
OVERVIE W
Background of AIBL
2.8
AIBL
Credit Rating
2.13
Organogram of an AIBL
2.20
Card
Chapter 3: LITERATUR
E
REVIE
W
3.8
Type
Chapter 4: DEPOSI T
MANAGEMEN
T
4.3
Deposit Mix
5.3
5.5
46
5.7
(4%)
5.8
Al-Arafah
5.10
Chapter 6: FINDINGS
References
Appendix
OF FIGURES
Page
A Performance at a Glance
(In million taka)
Figure 2C
an AIBL
Organogram of
Figure 4B
2013
Deposit Mi x
Figure 5B
Figure 5E
Category Wise
MSME Development (Client
Percentage) 48
Figure 5F
Sector wise
Agricultural Investment 20122013 (%)
50
Figure 5G
Gradual
Development of GSIS
Figure 5H
Gradual
Development of Solar Energy
Investment Client
55
Chapte
r
1
INT
ROD
UCT
IO
N
Topics
the Study
1.2 Origin of the
Report
1.6 Methodology of
the Study
1.3 Statement of the
Issue
1.7 Limitations of the
Study
1.4 Objectives of the
Study
1.1 Introduction
Bangladesh is one of
the
largest
Muslim
countries
in
the
world.
The
people
of this
country are deeply
committed to Islamic way
of life as enshrined in the
Holy Qur'an and
the Sunnah. Naturally,
it
remains
a deep cry
in
their hearts
to
fashion and
design their
Page 11
economic lives in
accordance with the
precepts of Islam.
The
establishment of Al-Arafah
commenced operations
in
Bangladesh
in
1983.
There are
8
Islami
Shariah based banks
in
Bangladesh and they
execute
banking
activities
according
to
Islami
Shariah
based
principles i.e. Profit-Loss
Sharing (PLS) mode.
and Investment
is
on
of
conducted
the
basis
my
practical experience of
three
months
long
internship at
Sonargaon
Janapath
Road
Branch
of Al-Arafah Islami
Bank
Limited.
After
consultation
with
my
faculty
supervisor
Dr.
Dutta, Professor,
School of Business,
Ahsanullah
University
of
Science &
Technology and under
the direction of my
organizational supervisor
Mr.
Rubayet
Ullah,
o
Senior Principal
Officer,
Sonargaon
Janapath Road
Branch,
AlArafah Islami
Bank
a
Limited, I have prepared
this internship report with
the mentioned topic.
Bank
L
To focus on deposit and investment
management practice in of AIB
L
To identify the problems related to
deposit and investment of AIB
L
To provide
guidelines
deposit and
some policy
for
improving
investment
1.6.2
Different data and information are required to meet the goal of this report. Those data and
information were collected from various sources, such as, primary and secondary which
is showed below:
(a) Primary Sources of Data: Primary source of data are known as the data
which are collected through
observation and direct contact. They are not
derived from any other sources. The primary data are the information collected
during the internship period by the observation and involvement. Most of the
primary data are collected through the following sources:
Day to day operation with staff of AIB
Page | 3
include written material such as; books, journal articles, newspapers as well as
administrative and public records. These types of data are collected through
following ways:
Annual report of AIB
for
l terms, office
Chapt
er 2
COM
PAN
Y
OVE
RVIE
W
Topics
2.1 Background of
AIB
L
2.19 Branch Network
2.20 Card & AT M
2.21 Green Banking
Credit Rating
2.12 Hierarchy of
the Management
Team
2.13 Organogram of
an AIB
L Branch
2.14 Internal Control
& Compliance
(ICC)
and
the
number
of
shareholders was 49,386.
It has
achieved a
continuous profit and
declared a good
dividend over the
years. High quality
customer
service through the integration
of modern technology and
new products
is the tool of
the
bank to achieve success. The
bank has a
diverse array
of carefully tailored products
and
services to satisfy customer
needs.
2.2 Vision
> To be a pioneer in Islami
Banking in
Bangladesh
and
contribute
significantly
to
the growth of the national
economy
2.3 Mission
2.4 Commitments
is a customer focused modern Islamic Bank, sound and
steady growth
in
both mobilizing deposit and making quality investment to keep their
position as a
leading Islami bank in Bangladesh.
To deliver financial services to retail, small and medium scale
enterprises, as well
as corporate clients through branches across the country.
AIBL' s
w
developers.
Page |
Branch:
Opening Ceremony:
Authorized Capital:
Paid-up Capital:
Local Partnership of Capital:
Equity:
Number of Branches:
Deposit:
Investment:
Number of Employees:
Number of Shareholders:
June 1995
Motijheel Branch, Dhaka
27 September, 1995
15,000.00 Millio n
8,343.25 Millio n
100
0
140,980.55 Million
125,715.39 Millio n
2,387
58,466
customers who are of paramount importance to the bank. The people in the Bank see
themselves as a tight knit team/family that believes in working together for growth. The
corporate culture has developed has not been imposed; it has rather been achieved
through their Corporate conduct.
Page | 8
2.8AIBL
for our
is becoming more and more attractive day by
day to peoples irrespective of nations, religious, colors and species. More than 300 Banks
& financial institutions are serving Islami banking throughout the world. At present in
our country 8 full-fledged Islamic Banks are working successfully. And other traditional
banks have Islami Banking Wings conducting Shariah based banking activities. Recent
Development of Bangladesh Government Islamic Investment Bond (BGIIB)
started its journey in
1995 with the said principles
banking system based on Al-Qur'an
Islami Bank
in mind and to introduce a modern
is the founder
inspiration provided a
boost for the bank in getting a foothold in the financial market of Bangladesh. A group of
20 dedicated and noted
Islamic personalities of Bangladesh are the member of Board of
Directors of the bank. They are also noted for their business acumen. Its authorized
capital is Taka 15,000.00 Millio n and the paid-up capital is Taka 8,343.25 Million . The
equity of the bank has stood at Tk. 16,091.17 million as on 31 December 2013, the
manpower was 2,387 and the number of shareholders was 58,466. It has achieved a
continuous profit and declared a good dividend over the years. High quality customer
service through the integration of modern technology and new products is the tool of the
bank to achieve success. The bank has a diverse array of carefully tailored products and
services to satisfy customer needs. The Bank is committed to contribute significantly to
the national economy. It has made a positive contribution towards
the socio economic
development of the country with 110
5,000.00
5,000.00
10,000.00
10,000.00
15,000.0
1,798.95
4,677.28
5,893.37
7,130.98
8,343.25
1,223.18
1,779.08
2,437.43
4,079.63
4,827.20
11,989.1
14,050.69
16,091.17
38,355.50
53,882.96
82,186.98
118,683.39
140,980.55
36,134.08
53,582.96
77,714.95
106,650.42
125,715.39
5,305.64
7,685.57
11,332.5
3,575.81
16,692.58
19,723.4
4,462.30
7,005.81
11,937.0
14,774.85
1,729.83
3,223.27
4,326.78
4,755.54
4,948.56
1,589.24
2,852.47
3,946.62
3,944.1
4,360.41
858.99
1,959.04
2,198.7
1,945.4
2,276.68
466.30
655.39
2,394.62
2,517.22
48,515.7
74,005.01
106,768.18
149,320.36
173,161.63
34,074.80
55,934.10
76,112.1
71,931.70
85,915.00
23,546.10
32,042.40
52,202.10
58,476.60
68,980.30
3,498.07
9,582.85
11,924.5
13,073.14
567.89
929.96
1,123.40
1,731.5
1,511.75
4,065.96
10,512.81
13,047.90
14,804.73
16,625.3
179,895,360
467,727,936
589,337,19
713,098,01
834,324,671
5
8
,
4
6
6
2.10 Performance
at a Glance
the
Short Term
Al
Bank Limited.
Ba
se
d
on
:
Date of
Rating:
Validi
ty:
for
Audited
Financial
Statement
2012
30 June,
2013
30 June,
2014
Pag
e|1
in
Vice President
Second Officer
Senior Officer
Officer
.
Junior Officer
Assistant Officer
Messenger
Figure 2C: Organogram of an AIB
Branch
(b)
Audit
(b) Board Audit Committee: The Audit Committee has particular responsibility to
evaluate the adequacy and appropriateness of internal control, internal audit and risk
management, evaluate compliance with laws and regulations etc.
Page | 13
(c) Management: Management actively manages and operates the bank in a sound and
prudent manner as per policy & guidelines of Board of Directors and regulatory
authorities.
(d) Shariah Supervisory Committee: To ensure whether the Shariah Principles are
followed in all the transactions & procedures of any activities.
(e) Al l the Zonal/ Divisional/ Departmental Heads/ Branch Managers & Executive/
Officials have to play a few roles in implementing Internal Control & Compliance of the
Bank.
of its financial
(g) Standard Policy/ guidelines on Risk Management & all the important aspects of the
bank, well designed Organizational Structure, Concurrent Audit, Auto Information/
Whistle Blowing
(ICT),
investments, and banking services. At the same time, the Board gives its opinion
on proposed new templates, and banking transactions.
in the Bank's
branches and
Analysing contracts
and agreements concerning the Bank's transactions, as
submitted by the Chairman of the Board of Directors or any department/branch
within the bank or requested by the Board itself so that Shariah compliance can be
evaluated and maintained.
Analysing administrative decisions, issues and matters that require the Board's
approval.
Supervising Shariah training programs for the Bank's staff.
Preparing an annual report in the Bank's balance sheet with respect to its Shariah
compliance.
The Fatwa & Shariah Supervision Board submits a complete annual report for the
Board of Director, summarizing all the issues referred to the Board, as well as its
opinion on the Bank's transactional procedures.
2.15.4 AIBL s
The AIBL's library houses a vast collection of more than 4,000 books on Islamic Fiqh,
law, economy, banking and Shariah, The library was primarily established with the aim
of serving the Fatwa &
Shariah Supervision Board's research team and the AIBL
Also the General Secretary of the Fatwa & Shariah Supervision Board, the Shariah
Supervisor handles queries about the Bank's administration from staff members,
shareholders, depositors and customers,
liaises with the Shariah auditors and provides
them with guidance. He submits reports and suggestions to the Fatwa & Shariah
Supervision Board and to the Chairman of the Board of Directors. The position also calls
for participation in the Bank's training programmes.
2.15.6 Sharia
h Auditin
Page | 16
its main
>
^
(twenty six)
Depo
sit
Invest
ment
Fore
ign
Trad
e
MS
ME
AT
M
Servi
ces
(ASB)
Foreign Currency
Deposit (FCD)
Pension Deposit
Scheme (PDS)
Cash Waqf Deposit
Scheme (CWD)
Mudaraba Lakhpoti
Deposit Scheme
(LDS)
Mudaraba
Millionaire Deposit
Scheme
(MDS)
Mudaraba (Special)
Pension Deposit
Scheme (MSPDS)
Mudaraba Kotipoti
Locke
r
Servic
es
Investme
nt in
Agricult
ural
Sector
Investme
nt in
Industria
l
Sector
Investme
nt in
Business
Sector
Investme
nt in
Foreign
Trade
Investme
nt in
Construc
tion
and
Housing
Investment in Transportation
Sector
Hire Purchase (HPSM)
Investment Schemes in
Masque and Madrasa
(MMIS
Small Enterprise
Investment
Schemes (SEIS)
Consumer
Investment
Schemes
(CIS)
Import
Export
Remittan
ce
(MKDS
2.20 Card
Over the past couple of years the
usage of Debit/ATM Cards has
increased dramatically.
People now feel safer and
comfortable in carrying plastic
cards
rather than bundles
of
money with them. Nowadays,
remarkable transactions occur in
ATMs. AIB
L have issued
about 20,000 (twenty thousand)
Debit/ATM Cards. Considering
this scenario the bank
has intended to expand the AT
M network and increase card
facility among the customers.
Meanwhile AIB L have
deployed
40 AT M
booths in various location
and another 10
ATMs are in process. They
have
already completed
testing with
NPSB
(National
Payment Switch of
Bangladesh) and the network
will
be
open
very
soon.
The
introduction of the common
switch
has
greatly
enhanced the efficiency
resources.
protect
If we
manpower and
2.22.1
Al-Arafa
h Islamic
Al-Arafah Islamic International School & College has been established by the Al-Arafah
o
Bank Foundation with a view to building next generation according to the ideals of peace
and equality of Islam and to establishing banking and other aspects of life in the way of
<
Islam. The prime aim of this Islamic International School & College is to contribute
towards building human resource and in the broader sense to ensure human welfare. With
o
Al-Arafah
Page | 20
Chapt
er
3
LITE
RATU
R
E
REVI
E
W
Topics
3.1
Isla
mic
Ban
king
3.2
Prin
cipl
es
of
Isla
mic
Ban
king
33
Isla
mi
Ban
king
in
Ban
glad
esh
3.4
Defi
nitio
n of
Ban
k
Dep
osits
3.5
Dep
osit
Acc
ount
3.6
Dep
osit
Ma
nag
eme
nt
3.7
Sha
ria
Inv
est
me
nts
3.8
Typ
e of
Fun
ds
3.9
Inv
est
me
nt
Res
trict
ions
3.1
0
Inv
est
me
nt
Ma
nag
eme
nt
3.2 Principles of
Islamic Banking
Islamic banking has the
same
purpose as
conventional
banking:
to
make
money for
the
banking institute by lending
out capital. But that is not the
sole purpose either. Adherence
to Islamic law and ensuring
fair play is also at the core of
^
arrangement is called
Murabahah.
Another
approach is
Eljara
An innovative approach applied by some banks for home loans, called Musharaka alMutanaqisa, allows for a floating rate in the form of rental. The bank and borrower form
a partnership entity, both providing capital at an agreed percentage to
purchase
the
Page | 22
property. The partnership entity then rents out the property to the borrower and
charges
rent. The bank and the borrower will then share the proceeds from this rent based on the
current equity share of the partnership. At the same time,
the borrower in the
partnership
entity also buys the bank's share of the property at agreed installments until the full equity
is transferred to the borrower and the partnership is ended. If default occurs,
both
the
bank and the borrower receive a proportion of the proceeds from the sale of the property
based on each party's current equity. This method allows for floating rates according
to
the current market rate such as the BLR (base lending rate), especially in a dual-banking
system like in Malaysia.
There are several other approaches used in business transactions. Islamic banks lend their
money to companies by issuing floating rate interest loans. The floating rate of interest is
pegged to the company's individual rate of return. Thus the bank's profit on the loan is
equal to a certain percentage of the company's profits. Once the principal amount of the
loan is repaid, the profit-sharing arrangement is concluded. This practice is called
Musharaka. Further, Mudaraba is venture capital funding of an
entrepreneur who
provides labor while financing is provided by the bank so that both profit and risk are
shared. Such participatory arrangements between capital and labor reflect the Islamic
view that the borrower must not bear all the risk/cost of a failure, resulting in a balanced
distribution of income and not allowing the lender to monopolize the economy.
Islamic banking is restricted to Islamically acceptable transactions, which exclude those
involving alcohol, pork, gambling, etc. The aim of this is to engage in only ethical
investing, and moral purchasing. The Islamic Banking and Finance Database provides
more information on the subject.
per
cent reserve banking are known to exist. Islamic banks have micro-lending institutions
founded by Muslims, notably Grameen
Bank, use conventional lending practices and are
However,
u
Muhammad
Yunus,
<
3.3 Islami
Banking in
Bangladesh
Islami Banking System is becoming more and more
attractive
day by
day to
peoples
irrespective of nations, religious, colors and species. More
than 300
Banks
& financial
institutions are serving Islami banking throughout the
world. At present,
eight
fullfledged private Islamic commercial banks and 17
conventional banks
through Islamic
windows and branches are operating in Bangladesh.
About half a dozen conventional
banks have applied to the Central Bank for being converted into
Islamic ones. Currently,
Islamic banks hold 24 percent of total banking deposit
having around
10 percent of the
total bank branches. The combined share of Islamic banks
(excluding
Islamic banking
branches/windows of conventional banks) is around
17
3.3.1
based banks
and financial institutions and
for their better management,
Investment
Government of Bangladesh
introduced the
BGIIB
to offer views
banks
in
of Islamic
practices. It
for
made
such as
For example,
makes
a deposit of Tk.
50,000
cash, the account holder surrenders legal title to the Tk.
50,000 cash. This cash becomes
an asset of the bank; the account becomes a liability.
life
including the type of investments
allowed.
For
instance,
interests are considered usury
according to the Riba rule therefore
bonds is prohibited to investors
following the Sharia
law. A Shariah compliant fund is an
investment vehicle fund structured in
accordance to
Shariah rules. Shariah funds can be
managed as mutual funds, exchange-
traded funds or
hedge funds. They are in essence
common funds with an extra
layer of ethical rules
integrated in the investment
policies
of the fund not
dissimilar to socially responsible
investing. While the funds are
required to
be fully
compliant with Shariah
rule,
the
companies structuring, managing and
promoting the funds do not have to be
necessarily
Shariah compliant.
Type of Funds
3.8.1 Commodities
commodities. Because
of the restrictions on the use of
derivatives, commodities fund make
use of two types of
Shariah approved contracts
It's a contract where the buyer of an
item funds upfront the production of
the item. A detailed specification of the
item has to be agreed before production
cc
of the item includes the profit of the person who has taken the task of purchasing
good and, of course, the cost of the product.
business.
Companies
are also screened in order to check for Shariah compliant accounting principles. Because
of the limited pool of companies the funds can invest into, equity funds can have higher
volatility compared to similar funds in the same space.
3.8.3 Murabaha
financing,
where a
fund will buy goods and resell them to a third party at a given price. The price is made of
the cost of goods plus a profit margin. Cost and margin are agreed in advance.
3.8.4 Ijar
Funds that acquire and keep ownership of an asset (real estate, machinery,
vehicles or
equipment) and then makes profits by leasing it out in return of a rental payment.
The
fund is responsible for the management of the asset and will normally
receive a
management fee. The leased item must be used in a Halal manner.
profit/loss
3.9.2
Comp
anies
involv
ed
in
prohib
ited
busine
ss
activiti
es
cannot
be part
of a
Sharia
h
fund
strateg
y.
Prohib
ited
busine
ss
activiti
es
can
relate
to
food
(produ
ction
and
sales
of
alcoho
lic
bevera
ges
includi
ng
pubs
and
restaur
ants,
pork
produc
ts,
tobacc
o),
gambli
ng
(casin
os,
on-line
gambli
ng,
betting
,
lottery
schem
es),
adult
oriente
d
(video,
magaz
ines,
on-line
materi
al,
strip
clubs),
dubiou
s,
immor
al and
illicit
trades
(prosti
tution,
drugs).
3.9.3
Maisir
Islam
forbids
gambli
ng in
any
form.
Conse
quenti
ally,
derivat
ives,
forwar
ds,
option
s and
futures
are
prohib
ited.
Other
forbid
den
practic
es
includ
e short
selling
,
Lotter
y,
margin
,
and
scalpin
g
trading
.
3.9.4
Day
Day
trading
is
consid
ered
akin to
maisir.
Marke
table
securit
ies
genera
lly
have a
multiday
settle
ment
period,
during
which
time
the
underl
ying
instru
ments,
while
cleare
d, are
not
formal
ly
registe
red in
the
name
of the
purcha
ser.
As
day
traders
do
not
wait
for
settle
ment
to
compl
ete,
they
are
using a
type of
credit
cushio
n
provid
ed by
their
broker.
Some
day
traders
also
rely on
a
margin
accoun
t to
financ
e their
trading
activiti
es.
3.10
Inve
stme
nt
Man
age
men
t
Invest
ment
manag
ement
is
a
dynam
ic
field
where
a
certain
standa
rd
of
longrange
planni
ng
is
needed
to
allocat
e
the
fund
in
divers
e
field
and
to
minim
ize
the
risk
and
maxim
izing
the
return
on
the
investe
d
fund.
Contin
uous
superv
ision,
monito
ring
and
^
foll
owup
are
hig
hly
requ
ired
for
ens
urin
g
the
tim
ely
repa
yme
nt
and
min
imi
zing
the
defa
ult.
Act
uall
y
the
Inve
stm
ent
port
foli
o
is
not
onl
y
con
stitu
ted
the
ban
>
=
manag
ement
depen
ds
on
the
banks
invest
ment
policy,
portfol
io
of
invest
ment,
JJ
monito
ring,
superv
ision
and
follow
-up
of
the
loan
and
advanc
e.
Theref
ore,
while
analyz
ing
the
Invest
ment
Manag
ement
of
AIBL
,
Chapte
r
4
DEP
OSIT
MAN
AGE
MEN
T
Topics
L
4.2 Deposit Growth
43
AIB
million
was
general
Page
|
28
deposit.
The
present
strategy
is
to
increas
e
the
deposit
base
through
maintai
ning
compet
itive
profit
rates
and
having
low
cost of
funds
to
ensure
a better
spread
with an
average
return
on
investm
ent.
4.2
Depo
sit
Gro
wth
Figure
4A:
Deposit
Growth
(In
million
Taka)
We can
see that
the
deposit
of
AIB
L
is
increasi
ng
every
year
and
in
2013
the
amount
of
deposit
was
140,98
0.55
million
taka
which
was
much
higher
than
2009's
Source: AIBL
Deposit Mix
(%)
Wadia Current Account
Mudaraba Savings Deposit
Other Mudaraba Deposit
Mudaraba Term Deposit
Bills Payable
or
Specified amount of charge will be debited with interval of six months as account
maintenance fee. Besides, the Bank can realize other necessary fees.
The account holder in any time can close the operation of his account after
surrendering his cheque book & submitting the application duly signed on
realization of closing charge.
g
notice. If any amount exceeding the above is withdrawn
without providing 07 days
i
If an account is closed before the declaration of
current year's
depositor will have to take profit as per previous years
declared profit rate.
The Bank has the right to deny opening any account or can close down any
existing with showing any reason.
The bank operates the client accounts with utmost attention but still if any
miscalculation occurs the bank holds the right to make adjustments and rectify the
problems. But in this situation if any miscreants occur which is caused by the Page | 32
client the bank wil l not be held liable for that.
The Bank may change / amend / rectify any rules and regulations of this account
and the client must abide by the rules.
4.4.3
Mudaraba Short Notice Deposit (SND) is a profit bearing Mudaraba deposit account
intended for those people who are involved in business or their transactions are frequent
but do follow a pattern. It enables people to operate a kind of Current Account which
incurs profit. Like in other Mudaraba deposit products, customer will act as the capital
supplier of the investment and the Bank acts as the investor/mudarib. The deposits held in
these accounts shall be payable on short notice period but the notice must not be less than
7 days.
R Products
4.4.5
It is a
monthl
y
saving
s
schem
e to
secure
future
with
ease. A
small
saving
s of
today
will
provid
e you
comfor
t
tomorr
ow.
Deposi
t can
be
made
by
conven
ient
monthl
y
install
ment
Pa
s
e
depend
ing
on
incom
e.
Install
ments
can be
deposit
ed
in
any
workin
g
day
of the
month.
Even
advanc
e
install
ment
may
be
deposit
ed.
Profit
will be
calcula
ted on
daily
basis
upon
deposit
.
To
make
it
more
attracti
ve
deposit
ed
amoun
t
will
be
weight
ed
1.05,
which
is
0.05
percen
t
higher
than 3
years
term
deposit
.
Durati
on of
the
deposit
will be
5, 8,
10 or
12
years
along
with
install
ment
amoun
t of
either
Tk.
200/-,
300/-,
500/-,
1000/-.
Any
person
above
18
of a
minor!
This
worth
while
schem
e will
make
deposit
to
grow
in the
followi
ng
ratio:
Source
:
AIBL
4.4.6
AlArafa
h
AlArafah
Islami
Bank
Limite
d has
introdu
ced a
Month
ly
install
ment
based
Hajj
Deposi
t
for the
5
8
1
2
4
5
9
1
1
middle
class
pious
Musli
ms.Jn
Year
Monthly Installment
750/800/880/950/1020/
1070/
1170/
1375/
1450/
1600/
1770/
2050/
2360/
2680/3140/
3900/
316500/
4880/6600/10000/
20000/Website (
297500/
284800/270000/255500/-
Hajj"
must
be
done.
Under
no
circumstances the deposited
amount will
be
withdrawn.
After maturity,
if the deposited
amount along with accumulated
profit is less than the Hajj
expenditure on that particular
year, the depositor can make
up the residual amount
at
once
and go for
pilgrimage.
A
separate form has to be filled up to
open Termed Hajj deposit. Under
this scheme one can
open an account in the name
of a
minor or
a
child
too.
Tax
will
be applicable on
the
deposited amount along with profit
according to the country law.
Estimated expenditure
for Hajj for next 25 years after
2008 and the relative one time
deposit will be as under:
Estim
ated
expens
e for
Hajj
18
00
00/
16
70
00/
15
80
00/
1
8
6
0
0
0
/
3
2
3
0
0
0
/
1
7
6
0
0
0
/
1
7
0
0
0
0
/
3
4
2
9
8
0
/
-
36
74
00/
15
30
00/
14
20
00/
13
10
00/
12
60
00/
11
90
00/
111
00
0/
1
5
8
0
0
0
/
3
8
0
0
0
0
/
1
4
6
0
0
0
/
3
9
0
0
0
0
/
1
3
9
0
0
0
/
4
1
4
0
0
0
/
1
3
2
0
0
0
/
4
3
6
0
0
0
/
1
2
3
0
0
0
/
4
5
0
5
0
0
/
1
1
5
0
0
0
/
4
5
0
5
0
0
/
4
6
6
0
0
0
/
-
103000/
107500/
466000/-
485000/9
7
0
0
0
/
9
6
0
0
0
/
9
8
6
5
0
0
/
-
6
8
6
7
7
3
7
1
6
6
6
7
5
0
0
/
-
9
7
6
4
0
0
0
/
-
8
6
6
6
5
6
Website (
Monthly
Installment
Based Marriage
Investment
Scheme (MIS)
1,
000/and
make
the
scheme
more
desirable.
The
main
attraction of the
scheme is that,
profit will be
accumulated on
deposit in a
daily-stay basis
with a
weightage
of 0.98
rate. This
fabulous
scheme comes
with exciting
investment
facility.
One
P
can take
M
advantage
of
on Total
Tk.30,
000/thl deposit
alongof
or
y double
his/her
In with
profit
deposit
sta
after
ll
(whichever
m maturit
is less) as
en y
(Estima
tinvestment.
Tax ted).
will be
1
applicable on
2
the deposited
4amount along
Source:
with AIB
profit
L
Website (
according to
the country
law.
being of mankind.
The Guidelines for
operation of this
scheme are stated
below:
Cash waqfs shall
be accepted
as
endowment
in
conformity
with the
Shariah.
Bank will
manage the waqf on
behalf of the
waqif.
or institution(s),
those Cash Waqf will
be treated as
General Cash Waqf
and the profit of
those A/Cs
will be spent for
welfare of mankind
in
the field of (1)
Family
Rehabilitation (2)
Education & Culture
(3) Health &
Sanitation (4)
Social Utility and
(5) Others.
On
the other
hand, Waqif may
choose distribution
of the
The amount
deposited
in
the Cash Waqf
A/Cs
o
will be
invested
as
per Bank's
own
^
profit at the highest
rate offered by the
Bank from time to
time. The waqf
amount
<
will remain intact
and only the
profit
amount will
be spent
for the
purpose(s)
specified
by the Waqif.
Unspent profit
amount will
automatically
be added to
waqf amount and
earn
profit to be grown
over the time. No
cheque book
will be
issued in this
account.
Page | 38
1,000/=
(one
thousand)
only (or
equivalent
foreign
currency).
The
subsequen
t
deposits
shall
also
be
made
in
hundred
or
in
multiple
of
hundred
Takas.
However,
General
Cash
Waqf
A/Cs
(where
name of
beneficiar
y whether
Individual
(s) or
Institution
(s) are not
mentioned
) may be
opened by
depositing
a
minimum
sum of
Tk.
1,000/=
only.
Specific
Cash
Waqf
A/Cs
(where
name of
beneficiar
y whether
Individual
(s) or
Institution
(s) are
mentioned
) by
depositing
a
minimum
sum of
Tk.
5,000/= &
above
.
Cash
waqf shall
be
accepted
in
specified
endowme
nt
Receipt
Voucher
and a
Certificate
for the
entire
amount
shall be
issued as
and when
the
declared
amount
is built.
Account
of Cash
Waqfs are
maintaine
d in a
separate
ledger and
necessary
charges
as per
rules may
be
deducted
therefrom.
In case of
any
change of
address of
the Waqif
or
beneficiar
y, must be
informed
by
the Waqif
to the
Bank
immediate
ly.
Bank
however
reserves
the right
to regret
to open
any Cash
Waqf
Account.
The rules
of Cash
Waqf
Account
are
subject to
amendme
nt in
conformit
y with the
Shariah at
any time
by the
Bank.
4.4.10
Mudarab
a
Lakhpoti
Deposit
Scheme
(LDS
Islami
Bank
Limited
has
brought
this
tremendo
us scheme
to make
the dream
of
becoming
a
"hundred
thousand
taka" true.
One can
select the
maturity
period
from 3,
5, 8, 10
or 12
years.
This eye
catching
scheme
is
lucrative
because
it will
accumulat
e z
profit on
your
deposit
in a dailystay basis
with a
weightage
0.05 more
than that
of a 2
^
years
deposit.
A single
person
can open
more than
one
account in
the same
branch.
Tax
^_
will be
applicable
on the
deposited
amount
along
with
profit
according
to the
country
^5
2
Period
Monthly Deposit
3 years
5 years
8 years
10 years
12 years
Page | 39
2,325/-
1,00,000/-
1,275/
1,00,000/
645/-
1,00,000/-
450/-
1,00,000/-
330/-
1,00,000/-
Website (
4.4.11 Mudaraba Millionaire Deposit Scheme (MMDS)
24400/-
17530/
Lacs
13500/
Lacs
10800/
Lacs
7 Years
10 Years
12 Years
8800/-
Lacs
5400/-
Lacs
4100/
Lacs
15 Years
2870/-
Lacs
Source:
AIBL
Page | 40
4.4.12 Mudaraba
(Special) Pension
Deposit Scheme
(MSPDS
An unparallel
scheme to make
small savings turn
into a line of
income in future.
In this
simple but
attractive scheme,
savings will be
accumulated in
monthly
installments. Then
in the future it
will be source of
monthly income.
One can decide the
size of monthly
deposit from
Tk.500/-,
Tk.
1,000/- or
any
multiple
of
Tk.
years. Deposited
amount will earn
profit on dailystay basis. This
particular scheme
has
profit with the
weightage of 1.05,
which is 0.05
more than that of a
3 years deposit.
Tax
will be applicable
on the deposited
amount along with
profit according to
the country
law.
9
3
0
0
0
4
0
0
0
M
o
nt E E E E E Es
hl st st st st st ti
y i i i i i m
m m m m m at
D at at at at at ed
e e e e e e
p d d d d d
os
m
it
d m d m d on
e o e o e thl
p nt p nt p y
os hl os hl os pe
it y it y it ns
w p w p w io
it e it e it n
h ns h ns h fo
p io p io p r
ro n ro n ro
fit fo fi fo fit ne
xt
r t r
15
af n af n af y
te ex te ex te e
r t r t r a
5 5 1 1 1 r
0 0 5 s
ye ye
y
ar ar y e ye
s s e a ar
a rs
rs s
4
1
2
5
0
0
0
6
0
0
0
7
0
0
0
8
0
0
0
2
4
9
9
0
0
0
2
2
8 1
3
7
2
5
6
6 8
1
8
5
5
0
2
3
2
0
0
1 1
1 2
2
7
9
0
0
1 3
3
2
5
5
0
1 1 2 3
3
7
2
0
0
1 1
9
8
3
7
2
5
1
0
1
0
0
0
0
1
8
Source: AIBL
Website (
requirement.
Any person above
18
can open this magnificent scheme.
Even an MKD
S can be opened on behalf of a
minor!
Page
| 41
Period of Deposit
Monthly
Installment
Expeeted return
after maturity
period
3 Years
244000/-
1
Cr
ore
4
Y
ea
rs
C
5
Y
ea
rs
Cr
6
Y
ea
rs
C
7
Y
ea
rs
C
10
Ye
ars
Cr
1
2
Y
ea
n
C
15
Ye
ars
Cr
18
Ye
ars
Cr
20
Ye
ar
s
Cr
Website (
Page | 42
Al-Arafah Islami
Bank Limited
Chapter
5
INVES
TMEN
T
MANA
GEME
N
T
Topics
Investment
3
5.4
Classified
Investmen
t Ratio
5.5 Micro,
Small &
Medium
Enterprise
s (MSME)
Investmen
t
5.6
Agricultur
al
Investmen
t
5.7
Investmen
t for
Growing
Spices at
a
Lowest
Profit Rate
(4%)
Scheme
5.12
Modes
of
Investmen
t
of
AIB L
5.13
Investmen
t
processing
of AIB
L
as on
December
106,650.42
of
million
year
investment of AIBL is
4 (Figure 4A). In 2013
was much higher than 2009's
Page | 44
Sectors
Taka in million
Agriculture, Fishing and Forestry
1,617.08
Industry
57,003.70
Construction
2,334.40
Water works & Sanitary Service
1,984.80
Transport & communication
8,262.50
Storage
831.2
Trade Finance
48,128.20
Miscellaneous
14,369.01
Total (Including Profit Receivable)
134,530.88
Less Unearned Profit on Investment
8,815.4
Total
125,715.39
(%)
a
n
d
F
o
r
e
s
tr
y
P
a
g
e
|
4
5
Water
Works &
Sanitary
Services
Commu
nication
Storage
Trade
Finance
Miscella
neous
Sector
Wise
Investm
ent (%)
of the
investm
ent
was
made to
this
sector.
Second
highest
investm
ent was
made to
trade
finance.
About
36.99%
of the
total
amount
was
invested
to trade
financin
g sector.
5.4
Classi
fied
Invest
ment
Ratio
Any
bank
investm
ent
that is
in
danger
of
default
is
classifie
d
investm
ent.
Classifi
ed
investm
ents
have
unpaid
interest
and
principa
l
outstand
ing, and
it is
unclear
whether
the
bank
will be
able to
recoup
the
investm
ent
proceed
s
from the
borrowe
r.
Banks
usually
categori
ze such
investm
ents as
adversel
y
classifie
d assets
on their
books.
target is
below
2.77%.
Page | 46
200 9
201 0
201 1
201 2
2
0
1
3
Figure
5C:
Classified
Investmen
t Ratio
(%)
was
much
higher
than
previous
years.
That is
not a
good sign
for the
profitabili
ty of the
bank. The
bank has
already
taken
necessary
actions to
put the
percentag
e below
2.77% in
2014
5.5
Micro,
Small
&
Mediu
m
Enterp
rises
(MSM
E)
Invest
ment
Micro
Small &
Medium
Enterprise
(MSME)
plays a
pivotal
role in the
economic
growth
and
developm
ent of a
country.
MSME
works as
the
platform
for job
creation,
income
generatio
n,
and
developm
ent
of
forward
and
backward
industrial
linkages.
MSMEs
occupied
a unique
position
in the
economy
of
Banglades
h. Micro,
Small and
medium
enterprise
s
(MSMEs)
make
up
the
largest
portion
of the
employm
ent
base
in
many
developin
g
countries
and,
indeed,
are often
the
foundatio
n
of the
local
private
sector.
z
Now the
MSMEs
are
not
only
concentrat
ed
to
low-tech,
traditional
,
and
agrobased ^
economic
activities;
these
are
spread
over
other
nontraditional
manufact
uring
and
^
service
sector as
well. To
achieve
high and
sustained
economic
growth, a
triggering
force
<
is
mandator
y to exit
from
endemic
poverty
and socioeconomic
deprivatio
n.
MSMEs
constitute
the
dominant
source of
industrial
employm
ent
in
Banglades
h (80%),
^_
and about
90% of
the
industrial
units fal
l
into this
category.
The actual
performan
ce of
MSMEs,
however,
varies
depending
on
the
relative
economic
efficiency,
the
g
macroeco
nomic
policy
environm
ent and
the
specific
promotion
policies
pursued
for their
[JJ
benefit.
To ensure proper manifestation and rapid advancement of Micro, Small & Medium
Enterprises, a number of schemes are running in this bank. In the light of a unique
definition of Bangladesh Bank, the bank is giving a priority over financing to three
categories of enterprises viz. Industry, Trade & Services. Based on December 2013, total
MSME investment portfolio is 68,913.60 million,
which is 52.96% of Total Investment
portfolio. Among them 28949.30 million is under Small Enterprises and 39964.30 million
is under Medium Enterprises. Participation of Small Enterprises is 42% of Total MSME
Investment. The bank prior Area Approach Method when MSME financing.
To speed up MSME investment flow and to include in people who are beyond the range
of banking facilities,
schemes named 'Small
are running in the bank. With
schemes, operation of collateral security free SEIS & MEIS investment is continuing in
all 110
these
December, 2013
Micro, Small & Medium Enterprise Investment
Portfolio
68,913.60
Terms & Conditions
Stipulated by the Bank
SEIS & MEIS (Collateral Security Free Investment, included MSME)
Portfolio
Tk. 582.52 Million
Minimum Investment
Tk. 50,000.00
Maximum Investment
Tk. 700,000.00
Number of Branches under the scheme
Rate of Profit
9%-10
Maximum Duration
3 years
Repayment System
Monthly Installment
Page | 47
Recovery Rate
99.77 %
Terms & Conditions
MSM E Portfolio of
Page | 48
il
Figure 5D: MSME
Investments of
AIB L (In
million Taka
Figure 5D shows that
AIB
L invested highest
amount of money on
MSME sector in 2013.
Around 68913
years.
Categorywis e
MSME
Developmen
t
(Number of
client)
Industry |
Service
Trade
Figure 5E shows percentage of category wise MSME investment clients. Most of the
clients are from trade sector (86%),
industry sector clients 11%
Page | 49
Agricultural Investment
Portfolio
Tk. 1650.65 Million
Fisheries
Poverty alleviation
Livestock Development
Warehouse of corps
Crops
Others
Number of Clients
Rate of Profit
Recovery Rate
Terms & Conditions
Source: AIBL
Sectorwis e Agricultura l
Investmnet 2012-1
3
Live Stock
Crops
Fisheries
Poverty alleviation
Warehouse of Crops
Others
Figure 5F: Sector wise Agricultural Investment
2012-2013
Figure 5F shows that 39% of the
agricultural investment
was on
fisheries. It
was the
highest amount of agricultural investment
during 2012-2013. Lowest
amount was
invested on warehouse of crops (1%).
December, 2013
Nam
e of
Crop
s
Pulse, Oil-seed,
Investm
ent
Amount
Spice
and Maize
Tk.
1.80
millio
n
Source: AIBL Annual Report 2013, page 39
With
to invest on various
productive
sectors. By
Stip
ulat
ed
by
the
Ban
k
decade.
(GSIS
Cottag e
Industry/
Enterprise
Fixed Assets
Valu e in Tak
a
And/o r
Attributes unde Excludin g Lan
Total
r
d
Numbe r of
th e categorie
& Building
employee s
s
(Includin g
Replacement
Cost )
Manufacturin
g
Less Tha n 5 La c
Less Tha n 1
Servic
Trad e
Less Tha n 5 La c
Less Tha n 5 La c
Less Tha n 10
Less Tha n 1
Number of Villages
Covered
Number of Branches
under the scheme
Number of Samit
Rate of Return
Dec'1 3
Figure 5G: Gradual
Development of GSIS
Energy
Investment
Scheme'
have
already
established
2,50,740
Watt
Peak of electricity among 5,011 families through 21
Rural Branches so far. The bank is
running this program with own funding as well as
permanent skilled personnel.
is shown in the table:
Electricit
y
Provided
2,50,740
Watt
Peak
Number of privileged
Family
5,
0
1
1
Repaym
ent
system
Recove
ry Rate
9
%
l
l
9
9
.
4
2
%
1^1
l
Figure 5H:
Gradual
Developm
ent of
Solar
Energy
Investment
Client
(Number)
in 201
shows
that
number
of
solar
energy
investment
client
has
been
gradually
increased
during the
year 2013
5.12
Modes
of
Invest
ment
of AIB
When
money is
deposited
in the
AIBL
, the bank,
in turn,
makes
investment
s in
different
forms
approved
by the
Islamic
Shariah
with the
intention
to earn a
profit. Not
only a
bank, but
also an
individual
or
organizatio
n can use
Islamic
modes of
investment
to earn
profits
for
wealth
maximizati
on.
Some
popular
modes of
investment
of
AIBL's
discussed
below:
5.12.1
Murabaha
h
This
concept
refers to
the sale of
goods at a
price. This
includes a
profit
margin
agreed to
by both
parties.
The
purchase
and selling
price,
other
costs, and
the profit
margin
must be
clearly
stated at
the time
of the sale
agreement.
The
bank
is
compensat
ed
for the
time
value of its
money in
the form of
the profit
margin.
This is a
fixedincome
loan for
the
purchase
of a
real
asset
(such
as
real
estate
or
a
vehicle),
with
a
fixed
rate
of profit
determined by the profit margin. The bank is not compensated for the time value of
money outside of the contracted term (i.e., the bank cannot charge additional profit on
late payments); however, the asset remains as a mortgage with the bank until the default
is settled.
Page | 56
5.12.2 Bar Muaiial (Credit Sale)
muajjal means a credit sale. Technically, it is a financing technique adopted
by Islamic banks that takes the form of murabahah muajjal. It is a contract in which the
bank earns a profit margin on the purchase price and allows the buyer to pay the price of
the commodity at a future date in a lump sum or in installments. It has to expressly
mention cost of the commodity and the margin of profit is mutually agreed. The price
fixed for the commodity in such a transaction can be the same as the spot price or higher
or lower than the spot price. Bai'
Bai Sala
Bai salam means a contract in which advance payment is made for goods to be delivered
later on. The seller undertakes to supply some specific goods to the buyer at a future date
in exchange of an advance price full
y paid at the time of contract. It is necessary that the
quality of the commodity intended to be purchased is full y specified leaving no
ambiguity leading to dispute. The objects of this sale are goods and cannot be gold,
silver, or currencies based on these metals. Barring this, Bai Salam covers almost
everything that is capable of being definitely
workmanship.
and
The transaction is considered Salam if the buyer has paid the purchase price to the
seller in ful l at the time of sale. This is necessary so that the buyer can show that
they are not entering into debt with a second party in order to eliminate the debt
with the first party, an act prohibited under Sharia. The idea of Salam is normally
Iiarah
Ijarah means lease, rent or wage. Generally, the Ijarah concept refers to selling the benefit
^
of use or service for a fixed price or wage. Under this concept, the Bank makes available
5
equipment such as plant, office automation,
1vehicle for a fixed period and price.
Page | 57
(Hire Purchase)
Parties enter into
contracts
that
come
into
effect serially, to
form a
complete
lease/
buyback transaction.
The first contract
is an Ijarah that
outlines the terms
for leasing or
renting over a
fixed period,
and
the
second contract is
a
Bai that
triggers a
sale
or
pag
concurrent and
interrelated legal
contracts, the net
effect being the
paying
of a fee for the use
of money for the
term of the loan.
The use of
concurrent
interrelated
contracts is also
prohibited under
Shariah Law.
Ijarah-Wal-Iqtin
an integral part of
the lease contract
to make it
conditional. The
rentals as well as the
purchase price are
fixed in such
manner
that the bank gets
back its principal
sum along with
profit over the
period of lease.
5.12.5 Mudarabah
is a
special kind of
partnership where
one partner gives
money to another
for investing it in a
commercial
enterprise. The
capital investment
should normally
come
from both partners.
The Mudarabah
(Profit Sharing) is a
contract, with ONE
party providing
100 percent of
the capital and the
other party
providing its
specialized
knowledge to invest
the capital
and manage the investment project. Profits generated are shared between the parties
according to a pre-agreed ratio. If there is a loss, the first partner "rabb-ul-mal"
his capital, and the other party "mudarib"
Page | 59
Islami
Bank (AIBL ) makes its investment decision through successfully passing the following
crucial stepsHere, investment taker (client) approaches to any of the branch of Al-Arafah Islami Bank
Bangladesh Limited (AIBL) . Then he talks with the manager or respective officer
(investment). Secondly, bank considers five
duly respective
information which is crucial for the initial of investment proposal. Generally, here, all the
required documents for taking investment have to prepare by the client himself.
</
(MOA
of
167B
Company's or client's
Owner's
List of partners
Purpose of investment/facilities
Page | 61
5.13.3 Sanction
Stag
As this stage, the bank officiall y approves the investment proposal of the
respective
client. In this case client receives bank's sanction letter.
Al-Arafah
sanction letter contains the following elements
Period of Investment
Rate of Return
Securities:
^>
Murabaha Post Investment (MPI)/ Bai Murabaha- Pledge of MPI/
*
Cash/
^
Cash/ Goods
Security
In allowing Murabaha
investment and amount of
cash security is generally
realized from
the client (amount
depends
on
the
nature
of
goods,
creditworthiness
of
the client,
collateral security
obtained etc.)
which
is
converted to
goods
security after
purchase of
pag
Example- if for a
Murabaha investment cash
security is fixed at 25%
Bank's investment
stands at 75% on the total
goods purchased. For
example, if cost of total
goods purchased
is Tk. 100000 Bank's
investment
will be tk. 75000 and
client's cash security
will be tk.
25000.
5.13.4 Documentation
Stage
At this stage, usually the
bank analyses wealthier
required documents are in
order.
In the
checks the following
some documents of
Disbursement Stage
63
Al-Aratah
Ch
apt
er
6
FI
N
DI
N
G
S
Topics
6.1
Findings
6.2
Problems
6.3 SWOT
Analysis
of
6.1 Findings
is committed
to provide banking
services that is
purely based
on
Islamic
Sharia
transparent and
efficient
in
this
competitive
environment.
Deposit
&
Investment
Management
related finding for
the year 2013 and
2012 are given
below:
Particulars
T
o
t
a
l
D
e
p
o
s
i
t
s
Total
Invest
ment
Invest
ment
Depo
sit
Ratio
(
T
14
1,
70
4,
64
0,
62
4
12
1,
29
8,
98
5,
43
9
85
.6
0
%
2.
97%
.0
8
%
2.
26
%
Amou
nt of
Classi
fied
Invest
ment
P
r
o
v
i
s
i
o
n
3
1
k
e
p
t
I
n
v
e
s
t
m
e
n
t
%
Income from
Investment in
Shares
607,225,060
772,218,82
1
7
0
6
,
3
2
9
,
0
0
0
heart of AIBL .
Investment of the
bank increased with
the increase of
deposit.
total deposit
amount
is
101,567,035,153.
ability
to
cover
withdrawals made
by
its customers. If the
ratio
is
too
high,
it means
that banks
might not have
enough liquidity to
cover any
unforeseen fund
requirements; if the
ratio is too low,
banks may
not
be
earning
as much
as they
could be.
AIBL' s
is 85.08%. Which
is good
for the bank.
Any bank
investment that
is in danger of
default
is
called classified
investment.
Classified
investments
have unpaid
interest and
principal
outstanding,
and it
is
unclear whether
the bank
will be able to
recoup the
investment
proceeds from the
borrower. Banks
usually categorize
such investments as
adversely classified
assets
of an investment.
6.2 Problems
Due to lack of AT M Booth facilities,
deposits.
facility.
Therefore
4. SMS banking facility is not available which is essential nowadays for depositors.
They have to come to the bank to know their account balance.
5. Banking software is not up-to-date. There are lot of software bugs, therefore often
bank officials face interruption in their work. They also use Windows XP as the
operating system which is out of date.
6. Banking service is not fast enough. Often customer need to wait for a long time for
service.
7. Marketing strategy of the bank is very poor. They do not use any
modern
advertising method to attract customers.
8. People cannot know about their investment products through online. Their website
is not up-to-date and most of the section are incomplete.
9. Lack of manpower slows down their service.
AIBL does not provide VISA card facility to its customers.
6.3.1 Strength
AIB L provides its customers excellent and consistent quality
in every service.
AIB L is a financially sound company.
AIBL utilizes state of the art technology
consistent
quality and
operation.
to ensure
6.3.2 Weaknesses
AIBL
6.3.3
Emergence of
online banking will
open more scope for
AIBL.
AIB L can
introduce more
innovative and
modern customer
service.
Many branches
can be opened in
local remote area as
its high demand.
AIB L can
recruit experienced,
efficient and
knowledgeable
officers
offers good working
environment.
6.3.4 Threats
The worldwide
trend of mergers and
acquisition in
financial institutions
is causing
problems.
Frequency
devaluation
foreign
exchange
fluctuation
taka
and
rate
is
causing
problem.
Lots of new
banks are coming in
the scenario with
new service.
Local
competitors can
capture huge market
share by offering
similar products.
Chapter 7
RECOM
MENDAT
ION S
AN D
CONCLU
SION S
Topics
7.1 Recommendations
7.2 Conclusions
7.1 Recommendations
should change the outlook of the
branch to attract premium
customers.
AIB L should provide an effective
training program for the junior level
officers.
The service in Sonargaon
Janapath
Road
Branch
has
real
good prospect, thus
the
bank should work actively so that
it can attract more clients.
The branch should give more
emphasis on proper record keeping.
They should give more attention in
increasing their deposits in different
accounts.
and
Barisal
Region
but more concentration at Dhaka and
Chittagong, they should give
concentration at Khulna and Barisal
Region also.
Optimal cost for sanctioning and
disbursing investment should be
minimized.
The number of branches should be
increased.
7.2 Conclusion s
the opening
of
more financial
institutions.
The Bank
is
optimistic
that
the
volume of
business wil
l
increase in future
through pragmatic and
market friendly
policies. The
Bank
shall
continue to explore new
fields of investment and
take steps
to open new
Branches for
Banking. The bank
should
endeavor to
adopt customer-oriented
policies
and
introduce
new techniques that
will
help
to
earn
profit
and
increase
greater
confidence of
the
*
existing prospective
customers.
:
Arafah Islami Bank
Limited. AIB
L is a bank that offers the
best islami banking
services
J
to its customer and also a
fast growing bank.
By working
in
Sonargaon Janapath
Road
J
Branch, the
knowledge
would
helpful
to sustain
the real
learned
be
enough
with
v.
organizational
environment.
References
Reilly and Keith
C. Brown,
"Investment
7th Edition.
Page | 70
Annual Report
2013
3) AIB L Annual
Report 2012
4) AIB L
Probaho (OctoberDecember 2013)
5)
6)
7)
en.wikipedia.org/
wiki/Islamic_bank
ing
8)
List of Acronyms
Islami Bank Limited
Profit-Loss-Sharing
Bachelor of Business
Administration
Authorised Dealer
M
Micro, Small
and Medium
Enterprises
A
G
M
Annual
General
Meeting
E
Extraordina
ry General
Meeting
B
Bangladesh
Government
Islamic
Investment
Bond
C
R
M
Core Risk
Manageme
nt
A
Automated
Teller
Machine
Corporate Social
Responsibility
C
Central Sharia
Board for
Islamic Banks
of Bangladesh
Letter of Credit
Pay Order
General Banking
Credit Information Bureau
My Internship Experience
Experience Regarding
Personal Improvement
1. Time Management
Time management is the great virtue for
each & every
person. As
a
private
university
student, I spent only 4 to 5 hours in
the university campus
with
gossiping,
taking tea
&
snacks. But in the professional life like
bank, each & every employee reach in
the office
not more than 9.30 am and go out
from
office not
less than
6pm
due to
heavy
working
pressure. So, I also maintained my
office time. They do their daily task
in daily basis. I
also helped them to make their task
easier.
4. Neat
I had
long
hair
with
little
beard
before
starting
my
internshi
p
program.
After
starting
internshi
p, make
my hair
short,
shaving
in time,
cutting
nail, and
polish
shoe in
time. I Pa
s e
have
wearied
ironed
and clean
cloth
regularly.
First few
days, I
feel
boring
but now I
am
habituate
d of it.
5.
Teamwo
rk
Theoretic
ally I
read
what is
team and
teamwor
k but
practicall
y I did
not have
experien
ce
about it.
In the
professio
nal life
there's
exist
team like
Banglade
sh cricket
team.
Each &
every
team
member
has
some
responsib
ilities
and
target to
fil
l
closely
and
helped
them to
make
their task
easier.
Practi
cal
Worki
ng
Experi
ence
(a)
Account
Opening
I
filled
different
types of
account
form for
the
customer.
There is
different
type of
Bank
account
such as
Current
Account:
I
filled
up the
current
account
form
for the
clients.
I also
checked
the
account
form and
checked
the
documen
ts for
opening
the
account.
Savings
Account:
I
filled
up the
savings
account
form
which
is
known
as
Mudarab
a
Savings
Account
(MSD)
for the
clients.
I also
checked
the
account
form
and
check the
documen
ts of
opening
the
Account.
Term
Deposit:
Here
I filled
up the
DPS
form
which
is
known
as ITD
(e) Others
necessary information
Putted various types of seals
for clearing
Updated the record book of
clearing, FDR and cheque books
Data entry task by computer
Filled up other necessary
forms for the bank