Financial statement Analysis Of Dutch-Bangla Bank
TERM PAPER
On
Financial statement Analysis
Of
Dutch-Bangla Bank
Submitted to:
MD. ATIAR RAHMAN
Assistant Professor
Department of Accounting
Submitted By:
Jesmin Akter
N.U. Roll: 8012631
Class Roll: 2501026
N.U. Reg: 2015156
Season: 2011-2012
BBA (Hon’s) Second year
Department of Accounting
Letter
of Transmittal
Date:
Atiar Rahaman
Assistant Professor
Sub: Submission of term
paper on Financial Statement Analysis.
Sir,
It is a great pleasure and privilege to present the
term paper titled "Financial statement Analysis of Dutch Bangla Bank"
which assigned to me as a partial requirement for the competition of B.B.A.
(Hon’s).
I tried my best to merge all the necessary and current
information gathered from different sources and knowledge acquired during the
internship and from the entire MBA program to represent this report as a unique
outcome of my efforts.
I
respectfully request to you accept this report.
Sincerely yours
Jesmin Akter
N.U Roll: 8012631
Class Roll: 2501026
Session: 2011-2012
N.U Reg.: 2015156
B.B.A. (Hons) Second
year
Department of
Accounting
Student's Declaration
I would like to declare that the report of term paper
namely "Financial Statement Analysis of Dutch-Bangla Bank" at Jessore
Branch and a comprehensive study of the existent activities of Dutch-Bangla
Bank and its implementation.
I also declare that this paper is my original worked
and prepared for academic purpose which is a part of BBA and the paper may not
be used in Actual Market Scenario.
Jesmin Akter
Class Roll: 2501025
N.U Roll: 8012631
N.U Reg.: 2015156
Session : 2011-2012
BBA (Hons) Second year
Department of
Accounting
Supervisor's
Declaration
I
hereby declare that that the concerned report entitled "Financial
Statement Analysis of Dutch-Bangla Bank" is an original work by Jesmin
Akter, a student of B.B.A. (Hon’s) class Roll: 2501026, N.U Roll: 8012631, N.U Reg: 2015156, Session:2011-2012, Department
of Accounting Govt. M.M College, Jessore has completed her Term Paper under my
supervision and submitted for the partial fulfillment of the requirement of the
degree of Bachelor of Business Administration (BBA) at Govt.M.M College,
Jessore.
MD. Atiar Rahaman
Assistant Professor
Department of
Accounting
Preface
Here
I am declaring that I am satisfied to work this topic and experienced about
some critical issues. Though it is a complex task, I experienced through the
practical observation and operation. For ensuring a quality work I have tried
much through a qualitative director's suggestions, format, related topics and
editorial part of the editors and columnist of different newspaper and
journals. I practice my total devotion to prepare my paper for my honorable instructor.
It is my first and foremost important task for new and going to submit to my
honorable instructor. So I strongly declare that it is absolute and have not
submitted anywhere before this submission.
Thanks for your time
and consideration.
Acknowledgement
The report titled as
"Financial statement Analysis on Dutch Bangla Bank" has been prepared
to fulfill the requirement of B.B.A. (Hons) degree. I am very much fortunate
that I have received sincere guidance, supervision and co-operation from
various respected people while preparing this report.
Many people helped me
to prepare this report. First of all, I would like to thank my academic supervision
of the internship program-MD Atiar Rahman Assistant Professor, Department of
Accounting, Govt. M.M college Jessore for giving me the opportunity to prepare
this report.
He also provided me
important advices and guidance for preparing this report. Without his Assistance,
this repot would not be a comprehensive one.
Secondly, I would like
to thank Department of Accounting of Govt.
M.M College
I would like to give
many special thanks and inexpressible greets to Inmates both deniers and fellow
BBA internship students and others for giving me good advice, suggestion and
support.
Thanks for all from the
core of my heart.
Finally, I would like
to thank all others whose strong support makes me able to complete the Term
Paper.
Table of Contents
S.L Chapter and Contents
Chapter-1
1.1 Introduction
1.2 Origin
of the Report
1.3 Objectives
of the Report
1.4 Scope
of the study
1.5 Methodology
Chapter-2
2.1 Introduction to the Banking Definition
2.2 Origin
of the Banking
2.3 Evaluation
of Banking in Bangladesh
2.4 Commercial
Banks
2.5 Functions
of Commercial Banks
Chapter-3
3.1 Nature
of data
3.2 Qualitative
data
3.3 Quantitative
data
3.4 Source
of data
3.5 Use
of data base
Chapter-4
4.1 Historical
Background of Dutch Bangla Bank Ltd
4.2 Vision
of Dutch Bangla Bank
4.3 Mission
4.4 Career
objective of DBBL
4.5 Principal
Activities
4.6 Product Range
4.7 Business
risk
Balance sheet
Profit and loss account
4.8 Analysis
of Current Ratio 2013
4.9 Analysis
of current Ratio 2012
4.10
Important Financial
information of DBBL for last five year
4.11
Capital structure of DBBL
Import variation
Export variation
4.12
Ratio Analysis of DBBL
Return
on Equity
Return
on Assets
Load Deposits Ratio
Return
on Investment
Earnings
per share
Chapter-5
5.1 Findings
5.2 Recommendation
5.3 Conclusion
1.1 Introduction
Bank is the important financial institution in the
economy. The economic development of a country depends on the development of
banking sector. Today's modern banks are not only providing traditional banking
services but also expanding many financial services.
Foreign Exchange Division occupies an important place
in a nation’s economy because of its intermediary role; it ensures allocation
of resources and keeps up the momentum of economic activities. A banking
institution is indispensable in a modern society. It plays a pivotal role in
the economic development of a country and forms the core at the money market in
any country.
In a developing country like Bangladesh
The internship Program exercise a significant
importance as it enables a student to be accustomed with the business
activities practically. The student gets the chance to work closely with the
people of an organization and learn about the functions, responsibility and
corporate culture of that organization. This program enables a student to
development their analytical skills and scholastic aptitudes and to have a
real-life orientation of the academic knowledge.
1.2 origin of the Report
The internship program is an integral part of the BBA
Program that all students have to undergo of National University , Bangladesh
1.3 Objective of the report
Objective of the study acts as a bridge between the starting
point and the goals of the study, to illustrate the objectives properly &
presented into two parts.
General
objective:
To observe the Foreign Exchange
operation of the DBBL. Their service and overall banking operation.
Specific
objective:
Ø To know the Foreign Exchange operation of the DBBL.
Ø To measure the Import, Export & Remittance
performance.
Ø To know about the LIC opening process.
Ø To know about the previous & present financial
condition of DBBL.
Ø To know present my observation & suggestion to the
bank.
1.4 Scope of the study
As a part of internship program, I was required to
learn various types of banking tasks which were assigned by the officers of
different departments. In this period, I am working with all the departments
but basically in a major portion of time I spend in general banking &
Foreign exchange department. Because excess load was always created in this
department. But I have also done different types of online related tasks, which
helped me to gain practical experience on Electronic banking activities of
DBBL. I am also done many tasks like pay order issuing, GL Account maintaining,
foreign remittance clearing etc. This has definitely enriched my practical
experience.
1.5
Methodology
For preparing this report primary and secondary data
have used. Data have been collected from two sources:
Primary
Sources:
Ø
Face-to-face
conversation with the respective officer of the branch.
Ø
Face-to-conversation
with the clients.
Ø
Observation.
Secondary
Sources:
Ø
Annual Report of
the DBBL.
Ø
Periodical
published by Bangladesh Bank.
Ø
Relevant file
study as provided by the officer’s concerned.
Ø
Different
procedure manual published by DBBL.
Chapter-2.0 Company Profile
2.1
Introduction to the Banking Regulation Act 1991 has defined the term
"Banking" under section 5(1) (b) as accepting for the purpose of
lending or investment, of deposits of money otherwise, and withdraw by cheque,
draft order or otherwise.
2.2
Origin of the Banking of the Banking Finance is the life blood of trade,
commerce and industry. Now-a-days, banking sector acts as the backbone of
modern business. Development of any country mainly depends upon the banking
system.
The term bank is derived from the French Word Bunco
which means a Bench or Money exchange table.
In older days, European money lenders or money
changers used to display (show) coins of different countries in big heaps
(quantity) on benches or tables for the purpose of landing or exchanging. A
bank is a financial institution which deals with deposits and advances and
other related services. It receives money from those who want to save in the form
of deposits and it lends money to those who need it.
2.3 Evaluation of Banking in Bangladesh
After
the liberation war, and the eventual independence of Bangladesh ,
the Government of Bangladesh reorganized the Dhaka
branch of the state Bank of Pakistan as the central bank of the country, and
named it Bangladesh Bank. This reorganized was done pursuant to Bangladesh Bank
came into existence with retrospective effect from 16 December 1971.
The 1971 Mujib regine ran a pro-socialist agenda-in
1972, the government decided to nationalize all banks in order to channel funds
to the public sector and to prioritize credit to those sectors that sought to
reconstruct the war-torn country-mainly industries and agricultural sectors. However,
government control at the wrong sectors prevented these banks from functioning
well. This was compounded by the fact that loans were handed out to the public
sector without commercial considerations, that banks had poor capital lease, provided
poor customer services ads didn't have any market-based monetary instruments.
But mostly, because loans were given out without commercial sense, and because
they took a long time to call a loan non-performing, and once they did so, recovery
under the erstwhile judicial system was so abjectly expensive, and their loan recovery
was abysmally poor.
2.4 Commercial Bank
The modern commercial bank in Bangladesh Bangladesh
2.5 Function of Commercial banks are divided into two
categories:
1. Primary function
2. Secondary function
including Agency Function
Primary function:
The primary functions
of a commercial bank include:
a. Accepting deposits
b. Granting loans and
advances.
a.
Accepting deposits:
The most important activity of a commercial bank is
mobilize deposits from the public people who have surplus income and savings
find it convenient to deposits the amounts with banks. Depending upon the
nature of deposits, funds deposited with bank also earns interest.
Thus
deposits with the bank grow along with the interest earned.
b.
Granting loans and advances
The second important function of a commercial bank is
to grant loans and advances. Such loans and advances are given to members of
the public and to the business community at a higher rate of interest than
allowed by banks on various deposit accounts. The rate of interest charged on
loans and advances varies depending upon the purpose, period and the made of
repayment.
1.
Loans
A loan is granted for a specific time period generally,
commercial banks grant short-term loans.
But term
loans, that are loan for more than a year, may also be granted the borrower may
withdraw the entire amount in lump sum or in installments.
2.
Advances:
An advance is a credit facility provided by the bank
to its customers. It differs from loan in the sense that loans may be granted
for longer period, but advances are normally granted for a short period of
time.
Modes
of short term financing assistance:
Banks
grant short-term financial assistance by way of cash credit, overdraft and bill
discounting
a.
Cash credit:
Cash credit is an arrangement whereby the bank allows
the borrower to draw amounts up to a specified limit. The amount is credited to
the account of customer. The customer can withdraw this amount as and when he
requires.
b.
Overdraft:
Overdraft is also a credit facility granted by bank. A
customer who has a current account with the bank is allowed to withdraw more
than the amount of credit balance in his account.
c.
Discounting of Bills:
Banks provide short-term finance by discounting bills,
that is making payment of the amount before the due date of the bills after
deducting a certain rate of discount.
Secondary Function including Agency
Function:
Besides the primary functions of accepting deposits
and lending money, banks perform a number of other functions which are called
secondary functions. These are as follows:
v
Issuing letters
of credit, traveler’s cheques, circular notes etc.
v
Undertaking safe
custody of valuables, important documents, and securities by providing safe
deposits vaults or lockers.
v Providing customers with facilities of foreign
exchange.
v
Transferring
money from any place to another and from one branch to another branch of the
bank.
v
Standing
guarantee on behalf of its customers for making payments for purchase of goods,
machinery, vehicles etc.
v Collecting and supplying business information.
v Issuing demand drafts and pay orders.
Chapter-03 Database
3.1
Nature of data:
Data base are assignment of value into observation of
events and abjects. They can be classified by their coding properties and their
characteristics of their domains and their range.
3.2
Qualitative Data
Qualitative data is a categorical measurement
expressed not in terms of numbers, but earns of a natural language disoperation.
In statistics, it is often used interchangeable with categories data.
Qualitative
data can be arranged into categorical that are not numerical. The categories
can be physical traits, gender color or anything that does not have a number
associated to it.
Qualitative
data is sometimes regarded to as categorical data. Qualitative data is
extremely varied in nature. It includes virtually any information that can be
captured that is not numerical nature.
3.3 Q quantitative Data
Quantitative data is a numerical measurement expressed
not by means of a natural language description, but rather in terms of number.
However, not all numbers are continuous and measurable.
Quantitative
data always are associated with a scale measure.
A
more general quantitative measure
is the interval scales. Intervals scales are also have an equidistant measure. However
the doubling principle breaks down in this scale.
A
temperature of 50 degrees Celsius is not 'half as hat' as a temperature of 100,
but a difference of 10 degrees indicates the same difference in anywhere along
with the scale. The kelvin temperature scale however constitutes a ratio scale
because on the Kelvin scale zero indicates absolute zero in temperature, the
complete absence of heat. All quantitative data are based upon quantitative judgments
and all quantitative data can be described and manipulated numeric.
3.4 Source of Data:
Data have been
collected from the two unique sources, one is primary source and another is
secondary source.
Ø Primary sources:
Conversation and
questioning with the different employees.
Ø Secondary sources:
(1) Brochures of Dutch
Bangla Bank.
(2) Annual report of
Dutch Bangla Bank.
(3) Different circular
sent by Dutch Bangla Bank.
(4) Official website.
3.5
Use of database:
After the data have been collected, the next logical
step is to present them in some suitable from. Data are presented in some
suitable from. Presentation of data can take two basic from:
1. Table
2. Statistical chart
A
table is the presentation of numbers in logical arrangement, with some brief
explanation.
Before
tabulation data it is after necessity to first classify them. Basically a chart
is a pictorial device for presenting data. For the sake of convenience
simplicity different types of diagrams are to be used.
MS
Word, MS Excel was used to analyze the data. Different tables and graphs were
used to make the data meaningful.
Chapter-4
4.1 Historical Background of Dutch
Bangla Bank Limited
Dutch Bangla Bank started operation is Bangladesh
It
is the largest bank in Bangladesh Bangladesh with the primary objective to carry
on all kinds of banking business in Bangladesh
Chittagong
Stock Exchange Limited.
DBBL was the first bank in Bangladesh
4.2 Vision of Dutch Bangla Bank
"To become a leading banking institution and play
a pivotal role in the development of the country."
Dutch-Bangla Bank dreams of better Bangladesh
4.3 Mission
Dutch Bangla Bank engineers enterprise and creativity
in business and industry with a commitment to social responsibility.
"PROFIT ALONE" does not hold a central focus in the banks operation,
because "Man does not live by brain and better alone."
4.4 Career objective of DBBL
Dutch-Bangla Bank believes in its uncompromising commitment
to fulfill its customers’ needs and satisfaction and to become their first
choice in banking. Taking cue from its pool esteemed clientele, Dutch-Bangla
Bank intends to pave the way for a new era in banking that uphold and epitomize
its vaunted Marques "Your Trusted Partner."
v
To earn and
maintain CAMEL Rating Strong.
v
To establish
relationship banking and improve service quality through development of
strategic Marketing plans.
v
To remain one of
the best banks in Bangladesh
v
To introduce
fully automated systems through integration of information technology.
v
To ensure an
adequate rate of return on investment.
4.5 Principal Activities
The principal activity of the bank is banking. The
banking business includes obtain deposits through account opening offer credit
to corporate organizations, as well as retail and small & medium
enterprise, trade financing project financing, lease and hire purchase
financing. The modes of banking include conventional banking. It also performs
merchant banking function under the license by Securities and Exchange
Commission, Dhaka .
4.6 Product Range of Dutch Bangla
Bank limited
The product list of
Dutch Bangla Bank limited is stated below:
|
Products services offered
by DBBL:
|
Various Deposits:
|
|
1.
Retail Banking
2.
Remittance and
collection
3.
Import and
export handling and financing
4.
Corporate
Banking
5.
Project Finance
6.
Investment
Banking
7.
Consumer Credit
8.
Agriculture
Loan
9.
Real line any
branch banking
10.
24 Hours Banking through ATM
11.
DBBL-NEXUS Debit card
12.
DBBL-Maestro cirrus Debit card
13.
DBBL Credit Card
14.
Internet Banking
15.
SMS Banking
16.
On-Line Banking through all Branches
|
1.
Saving Deposits
Account
2.
Current
Deposits Account
3.
Short Term
Deposits Account
4.
Resident
Foreign Currency Deposit
5.
Convertible
Taka Account
6.
Non-Convertible
Account
7.
Exporter’s FC
Deposit
8.
Current Deposit
Account-Bank
9.
Shot-term
Deposits Account Bank
Loan
& Advances
10.Lease
Finance
11.
Other Term Loan
12.
FMO Local currency loan for SME
13.
FMO foreign currency loan
14.
Cash Credit (Hypothecation)
15.
Small shop Financing Scheme
|
4.7 Business Risk
Business
risk covers the ricks of losses arising from lower non-interest income and
higher expenses from the budget amount. The business risk is resulted from the
market condition, customer’s behavior or technological development that may
change compared to the assumptions made at the time of planning. Business risk
in Dutch Bangla Bank is managed by setting clear targets for specific business
units, in them of business volume, income cost, income ratio, quality of assets
etc. with an ordaining process.
Dutch Bangla Bank Limited
Balance sheet
As at 30 June 2013
|
Particular
|
2013
|
2012
|
|
Cash
|
1267.09
|
1419.67
|
|
Cash in hand
|
136.87
|
161.43
|
|
Balance with
Bangladesh Bank & Sonali Bank
|
1233.22
|
1258.26
|
|
Balance with Bank
& Financial institution
|
350.40
|
144.56
|
|
In
|
269.26
|
86.15
|
|
Out
|
50.14
|
70.29
|
|
Investment
|
4.44
|
5.55
|
|
Loans & advances
|
14421.48
|
13929.63
|
|
Bills Purchase &
discount
|
629.56
|
767.35
|
|
Fixed assets
|
626.67
|
512.57
|
|
Other assets
|
1686.26
|
1920.55
|
|
Total assets
|
20675.93
|
20276.01
|
|
Borrowing from other
banks
|
3598.89
|
3923.59
|
|
Deposits & other
Accounts
|
15456.23
|
12268.25
|
|
Current &
Contingency Accounts
|
2301.17
|
2688.24
|
|
Bills payable
|
135.76
|
84.59
|
|
Saving Deposits
|
3766.68
|
3680.05
|
|
Fixed Deposits
|
9042.60
|
7035.39
|
|
Total Liabilities
|
34301.33
|
29680.11
|
|
Paid up Capital
|
900.00
|
900.00
|
|
Others Revenue
|
642.57
|
646.76
|
|
Retained earnings
|
(13625.94)
|
(9404.1)
|
|
Total capital
shareholder equity
|
1592.75
|
1191.03
|
|
Off Balance sheet
items total
|
1511.62
|
1296.40
|
Dutch-Bangla Bank Limited
Profit and Loss Account
For the year ended on 30 June 2013
|
Particular
|
2013
|
2013
|
|
Interest Income
|
1357.04
|
1272.16
|
|
Less: Interest Paid
|
(1395.03)
|
(1133.24)
|
|
Net interest paid
|
37.99
|
138.92
|
|
Non-interest Income
|
168.72
|
216.86
|
|
Income from
Investment
|
.16
|
-
|
|
Commission, Exchange
and Brokerage
|
82.94
|
153.18
|
|
Other Receipts
|
88.70
|
82.68
|
|
Total operating
Income
|
135.57
|
591.64
|
|
Salary and allowance
|
448.06
|
413.29
|
|
Rent, taxes,
Insurance
|
22.75
|
19.53
|
|
Law charges
|
.18
|
.09
|
|
Postages, telegram,
telephone
|
1.98
|
1.68
|
|
Auditors fees
|
.19
|
.09
|
|
Stationery, Printing
and advertisement
|
4.76
|
4.16
|
|
Pay and allowance of
MD
|
.17
|
.17
|
|
Directors fees and
traveling allowance
|
.16
|
.14
|
|
Depreciation and
repairs
|
11.47
|
8.35
|
|
Others Expenditure
|
48.72
|
47.88
|
|
Total operating
expenditure
|
538.44
|
495.38
|
|
Profit and Loss
before Provision
|
(388.42)
|
(150.41)
|
|
Provision for value
of investment
|
1.26
|
|
|
Total Profit/Loss
before taxes
|
(389.68)
|
(140.41)
|
|
Net Profit/Loss after
tax
|
(390.94)
|
140.41
|
4.8 Analysis of Current
Ratio: 2013
4.9
Analysis of Current Ratio: 2012
Comments: The ratio measures the ability of a company
to pay its current liabilities. Standard Ratio is 2:1 and the actual ratio
.40:1 which is lourr than standard ratio. So the company’s financial position
is not sound and its position is respect of payment of its current liabilities
is not satisfactory.
4.10
Important Financial information of DBBL for Last Five years
Particular
(in crore)
Operating
performance (income statement) (to the year)
|
Particular
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
Authorized
capital
|
400
|
400
|
400
|
1000
|
4000
|
|
Pain-in-capital
|
201.14
|
201.14
|
201.14
|
1000
|
1500
|
|
Reserve
|
490.46
|
637.86
|
842.31
|
1197.52
|
2000
|
|
Deposits
& others
|
27241.11
|
40111.54
|
42110.15
|
51575.67
|
67788.53
|
|
Accounts
|
9711
|
9987
|
10271
|
10894
|
11922
|
|
Loans
& Advances
|
22592.27
|
30456.32
|
29403.12
|
41698.32
|
48410.99
|
|
Export
|
22144.17
|
33344.69
|
34060.27
|
40083.14
|
41162.51
|
|
Import
|
26029.01
|
32067.74
|
35667.74
|
43999.43
|
53088.66
|
Table1:
DBBL at a glance (2009-2013)
|
Particular
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
Book
value per share (Taka)
|
312.08
|
309.65
|
323.91
|
379.27
|
394.21
|
|
Market
value per share (Taka)
|
327.22
|
388.91
|
402.11
|
437.99
|
827.26
|
|
Earnings
per share (Taka
|
181.97
|
179.18
|
237.37
|
54.78
|
75.85
|
|
Dividend
per share (Taka)
|
25
|
25
|
395
|
50
|
33.33
|
|
Return
on Equity
|
5.87
|
7.3
|
9.48
|
9.69
|
14.64
|
|
Return
on Assets (Taka)
|
1.29
|
.93
|
1.01
|
1.49
|
1.60
|
|
Classified
Loan as a% of loan
|
1.58
|
2.68
|
3.26
|
3.27
|
2.46
|
|
Capital
Adequency Ratio
|
10.16
|
10.05
|
11.76
|
10.89
|
11.59
|
|
Cost
income Ratio
|
7.48
|
8.88
|
8.44
|
7.66
|
6.63
|
|
Net
intrest Margin
|
3.25
|
3.27
|
2.11
|
3.49
|
3.88
|
|
Number
of Branches
|
28
|
39
|
49
|
64
|
79
|
|
Number
of Employees
|
548
|
684
|
789
|
1229
|
1785
|
Table2:
DBBL, at a glance (2009-2013)
4.11
Capital structure of DBBL
Banks generally do their business with others fund so
DBBL is in exception. DBBL uses 24% equity and 75% Debt source of capital. The
capital structure is following:
|
Particulars
|
Percentage
|
|
Total
shareholders’ Equity
|
25.02%
|
|
Long
term debt (Fixed deposits 1 years & above
|
74.98%
|
|
Total
capital
|
100%
|
Total capital
4.12
Comparative Analysis of DBBL
In this analysis, I try to find out the position of
our bank comparing with the other banks that are almost same level in banking
sector. I consider Dhaka Bank Ltd. Prime Bank Ltd & Southeast Bank Ltd for
comparative analysis with Dutch-Bangla Bank Ltd. I try to represent the
position of those banks according to their year financial information
separately in the following by charts as well as the graphs comparing with the
amount variation.
Import Variation:
|
Particulars
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
Dhaka
Bank Ltd.
|
30213.00
|
46277.00
|
49496.00
|
65737.00
|
46160.00
|
|
Prime
Bank Ltd.
|
40303.00
|
52639.00
|
70617.00
|
91424.00
|
96452.00
|
|
Southeast
Bank Ltd.
|
29079.03
|
35125.12
|
38470.34
|
58019.77
|
69582.92
|
|
Dutch-Bangla
Bank Ltd.
|
26029.01
|
32067.74
|
35667.74
|
43999.44
|
53088.66
|
Export Variation:
|
Particulars
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
Dhaka
Bank Ltd.
|
13505
|
23268
|
31081
|
39038
|
33305
|
|
Prime
Bank Ltd.
|
28882
|
41801
|
51316
|
68550
|
76097
|
|
Southeast
Bank Ltd.
|
13511.10
|
25874.61
|
28771.36
|
42178.60
|
46724.47
|
|
Dutch-Bangla
Bank Ltd.
|
22144.17
|
33344.69
|
34060.27
|
40083.14
|
41162.51
|
4.13 Ratio Analysis of DBBL
Ratio
analysis is an analytical tool can be applied to a bank’s financial statements
so that management and the external users can identify the most critical
problems inside each bank and develop ways to deal with those problems. Some
selected ratios are mentioned here to give an insight about Dutch-Bangla Bank
Ltd.
Return on
Equity
|
Year
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
ROE
(%)
|
31.01
|
24.07
|
24.02
|
29.89
|
30.28
|
Interpretation: In ROE of DBBL, it is analyzed that ratio is almost
equal in every year that the bank is in constant level.
Return
on Assets
|
Year
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
ROA
(%)
|
1.29
|
0.93
|
1.01
|
1.49
|
1.60
|
Interpretation:
In the ROA it is analyzed that the bank’s ROA is in
constantly growing which indicating that bank is using its assets effectively
than previous year.
Loan Deposits Ratio:
|
Year
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
Loan
Deposit Ratio (%)
|
82.93
|
75.93
|
69.82
|
80.85
|
71.41
|
Interpretation:
The standard of loan deposit ratio is 85%. The loan
deposit ratio of DBBL in 2009 and 2010 is 80.85% and 71.41%, which indicates
that DBBL is not in progressive but satisfactory.
Return on Investment:
|
Year
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
ROI
(%)
|
5.87
|
7.3
|
9.48
|
9.69
|
14.64
|
Interpretation:
DBBL’s Return on Investment is 5.87% in 2009 and in
2013 is 14.64%, which indicates that DBBL is making progress and arrange their
investment decision in effective way.
Earnings
per Share (EPS):
|
Year
|
2009
|
2010
|
2011
|
2012
|
2013
|
|
EPS
(in Taka)
|
181.97
|
179.18
|
237.37
|
54.78
|
75.85
|
Interpretation:
The EPS of DBBL is not sustainable but EPS of 2010
higher than 2009, which means that the bank may generate more growth in EPS in
the future.
Chapter-5
5.1 Findings
While preparing the report, I have learned several
activities of FED of DBBL regarding financing, import, export, purchasing bill
etc. this activities are summarized below:
The most important factors that have been found to
play a significant role in the number of Export LIC on a month at DBBL are back
to back LIC and Export cash credit (ECC). Other than that, package credit (PC)
also has a big impact on the number of Export LIC in a month.
Ø The original un-standardized equation, with statically
significant and insignificant variables.
Ø In foreign exchange department it is required to
communicate with foreign banks and international division of DBBL frequency and
quickly.
Ø To make the process easily modern communication media
for w-mail, fax, Internet etc. Should be used. But the bank has not so much
practice of using theses media.
Ø Modern technical equipment such as computer is not
sufficient in foreign exchange process makes delay and it is also complicated.
Ø If any wrong information can wrote by officer in IMP
from, bank will lost their dealership and must be cancelled.
Ø DBBL faced a challenging position in various competing
banks in current market.
5.2 Recommendation:
The bank should higher export who can understand the
future economic situation and can take initiative based on the forecast. Again
the banks can achieve success from the economy if they can handle the situation
efficiently.
Ø Bank should
improve their research center and training center to enrich the knowledge
regarding uniform customs and practice for documentary credit.
Ø I recommend that the bank improve its management of
international division who are responsible for handling their foreign exchange
related risk.
Ø Again the bank should maintain correspondence
relationship with the bank that wills them to settle payment and receipt
regarding foreign exchange transaction.
Ø The bank should aware about their customer to meet up
their demand to maintain their goodwill.
Ø Bangladesh
Ø Foreign exchange department of DBBL should enrich by
new technology to make a good competition among the banks.
Ø
5.3 Conclusion:
In
conclusion, Dutch Bangla Bank Limited is one of the most potential Banks in the
banking sector. It has a large portfolio with huge assets to meet up its
liabilities and management of this bank is equipped with the export bankers and
managers in all level of management. So, it is not easy job to find out the
drawbacks of this branch. I would rather feel like producing my own opinion
about the ongoing practices in Mirpur circle-10 Branch. Over the last few
decades there have taken place dramatic transformation in the realm of foreign
exchange and financing of foreign trade. In the wake of these changes the
financial experts have developed a whole range of few ideas and techniques on
management exchange rates, investment of foreign exchange reset be and opening
up the economy. Currently this sector is becoming extremely competitive with
arrival of multinational banks as well as technology infrastructure,
effectively foreign exchange related transaction. We know that institutional
support is necessary for undertaking international trade and foreign exchange business.
On the other hand expertise regarding management of exchange rate is essential
for successful operation of foreign exchange related transaction. So, the banks
have performed the foreign exchange transaction in a more innovative way. So,
Dutch Bangla Bank Limited has to reengineer its plan and reform the service
improvement strategy to remain the higher performance level, customer
satisfaction and to complete with challenges
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