Port City International University

An Internship Report
On
“Foreign Exchange Operations of National Bank Limited:
A Study on Chawkbazar Branch, Chattogram”

(The internship report is submitted to the Department of Business Administration, Port City
International University, in partial fulfillment of the requirement for the Degree of Bachelor of
Business Administration with major in Finance.)

Submitted to
Dr. Rajib Chakraborty
Assistant Professor

Department of Business Administration

Port City International University

Submitted By
Tanbir Mohammed Tuhin
ID: BBA 01907375

Major: Finance

Department of Business Administration

Port City International University

 Letter of Submission
To

Dr. Rajib Chakraborty

Assistant Professor

Department of Business Administration

Port City International University, Chittagong.

Subject: Submission of internship report on “Foreign Exchange Operations of

National Bank Limited: A Study on Chawkbazar Branch, Chattogram”.

Dear Sir,
With due respect, it is an immense pleasure for me that I am submitting my
internship report on Foreign Exchange Operations of National Bank Limited: A
Study on Chawkbazar Branch, Chattogram. As a student of Port City
International University I have prepared my internship report on Foreign
Exchange Operations of National Bank Limited: A Study on Chawkbazar
Branch, Chattogram. The duration spent working on this has been very beneficial
for me as I was able to gain knowledge which I believe that would be helpful for
my future job life. I have tried my level best to gather and organize all the
information required for this Internship report and come up with an effective
report.

I shall be highly obliged if you are kind enough to receive this report and provide
your valuable judgment.

Sincerely yours

……………………………………
Tanbir Mohammed Tuhin
ID: BBA 01907375
Program: BBA
Major: Finance
Department of Business Administration
Port City International University.

I
 Student’s Declaration
I am Tanbir Mohammed Tuhin, hereby state that the presented report of internship
titled “Foreign Exchange Operations of National Bank Limited: A Study on
Chawkbazar Branch, Chattogram” is exclusively prepared and updated by me
after completion of three months’ work in National Bank Limited. I solemnly
confirm that the report is entirely prepared for my academic requirement not for
any other purposes.
The entire work has been planned and carried out by me under the supervision of
Dr. Rajib Chakraborty. Assistant Professor, Department of Business
Administration, Port City International University, Chattogram. I also confirm that
the report is only prepared to meet academic requirement not for any other
purpose. It will not act anything that will hamper the confidentiality and interests
of National Bank Limited.

Sincerely yours,

……………………………………
Tanbir Mohammed Tuhin
ID: BBA 01907375
Program: BBA
Major: Finance
Department of Business Administration

II
 Supervisor’s Certificate
The report titled “Foreign Exchange Operations of National Bank Limited: A
Study on Chawkbazar Branch, Chattogram” is submitted as partial
requirement of BBA program. This report has been prepared by Tanbir
Mohammed Tuhin, ID: BBA 01907375 under my supervision and guidance. I am
pleased to state that Tanbir Mohammed Tuhin worked hard in preparing this report
and he has been able to present a good report. The data and findings presented in
the report seem to be authentic. As per my knowledge goes it was not submitted to
other university or institute for getting degree or diploma or for publication.

I wish him every success in life.

……………………………
Dr.Rajib Chakraborty
Assistant Professor
Department of Business Administration
Port City International University, Chittagong.

III
 Acknowledgements
At the beginning, I would like to express my thanks to the Almighty Allah for giving me the
patience to complete the Report on title “Foreign Exchange Operations of National Bank
Limited: A Study on Chawkbazar Branch, Chattogram”.

I express my gratitude to my academic Dr.Rajib Chakraborty, Assistant Professor Department of

Business Administration, Port City International University, Chittagong. Without his kind
support, this study would have been a failure.

I also want to thank the HR team who provided me with all the necessary information, guidance
and support that I required in making this report. They also made sure that I have a great
working experience National Bank Limited by delegating me business tasks which I know
would serve me extremely well in the foreseeable future.

Finally, I would like to convey my gratitude to my Parents. Without their contribution it would
not be possible for me to continue my job as well as my BBA program.

IV
 Executive Summary
Foreign Exchange we mean foreign currencies or more commonly, claims to foreign money
balances. It includes all monetary instruments which give residents of one country a financial
claim on another country. The use of foreign exchange is a country’s principal means of settling
its transactions with other countries. In the broader sense, the foreign exchange is related to the
mechanism of foreign payments. It refers to the system whereby one currency is exchanged for or
converted into another Foreign exchange also refers to the global market where currencies are
traded virtually around-the-clock. The term foreign exchange is usually abbreviated as "forex"
and occasionally as "FX."
National Bank Limited has opened 150 branches across the country and has been dealing with a
wide variety of Foreign exchange Credit and Deposit Products since its emergence. This study
deals with the performance of foreign exchange and the foreign exchange management practice
National Bank Limited. The study is entitled as “Foreign Exchange Operations of National
Bank Limited: A Study on Chawkbazar Branch, Chattogram”. In this report consist up with
six individual parts. In here the first chapter is the Introduction part & here briefly describe
introduction of the study, objectives, methodology, scope, limitations and my Experiences during
the report.
The Second chapter is overview of National Bank Ltd and also mission, vision products, services
discussed here. Theoretical aspects briefly discussed in third chapter. Chapter four discussed with
Foreign Exchange Functions of National Bank Ltd. Chapter five contains the main part that
contains details of Foreign Exchange Operation, performance and data analysis of National Bank
Ltd. The Final part is Concluding Notes here describe findings, recommendations and conclusion.
Foreign exchange is an important department of National Bank Ltd, which deals with import,
export and foreign remittances. It bridges between importers and exporters. This department is
playing an important role in enhancing export earnings, which aids economic growth and in turn it
helps for the economic development. On the other hand, it also helps to meet those goods and
service, which are most demandable and not adequate in our country.

V
 Table Of Contents
Serial Topic Page No
Letter of Submission I

Student’s Declaration II
Supervisor’s Certificate III
Acknowledgement IV
Executive Summary V

Chapter Introduction 1
One
1.1 Introduction 2
1.2 Origin of the Study 3
1.3 Background of the Study 3
1.4 Objectives of the Study 4
1.5 Scope of the Study 4
1.6 Methodology of the Study 5
1.7 Limitations of the Study 5
Chapter Overview of National Bank Ltd 6
Two
2.1 History and Heritage 7

2.2 National Bank Limited at a Glance 7-10

2.3 Vision and Mission 10
2.4 Objectives of National Bank Ltd 10-11
2.5 Organizational Strategy 12
2.6 Division of National Bank Limited 12
2.7 Services of National Bank Limited 13
2.8 Management Hierarchy of National Bank Limited 13
2.9 SWOT Analysis of National Bank Limited 14
2.10 Products of National Bank Ltd 15
2.11 Board of Directors 15
2.12 Corporate Strategies of National Bank Ltd 15-16
 2.13 Banking Department of National Bank Ltd 16
2.14 Corporate Social Responsibility 16
2.15 Shares of NBL 16-17
2.16 Effective risk management for NBL 17
2.17 Green Banking of NBL 17
2.17 Conclusion 17-18
Chapter Theoretical Aspects of Foreign Exchange 19
Three
3.1 Foreign Exchange 20
3.2 History of Foreign Exchange 20-21
3.3 Foreign Exchange Regulation Act, 1994 21
3.4 Foreign Exchange Market 21-22
3.5 Foreign Exchange Rates 22-23

3.6 Risk in foreign exchange 23-24

3.7 Concepts 24-28
3.8 Import Section 28-30

3.9 Export Section 30-31

3.10 Foreign Remittance 32-34

Chapter Performance Analysis of National Bank Ltd 35

Four
4.1 Data Analysis 36-40
4.2 Society for Worldwide Interbank Financial 41
Telecommunication(SWIFT)
Chapter Findings ,Recommendations & Conclusion 42
Five
5.1 Findings 43
5.2 Recommendations 44
5.3 Conclusion 45
References 46
Chapter One
Introduction

1
1.1 Introduction

This report has a certain purpose to focus on the operations of “Foreign Exchange” of
National Bank Limited. Without any doubt Foreign exchange catches the flash as it has great
importance in the balance of trade in economy. Banks plays a vital role in his discipline. This
report is prepared on the purpose to better understand about foreign exchange operation in
perspective of National Bank. Now a day’s international business has become very common
activities in business and day by day it got an integrated part for doing business. In this
globalization era a business organization faces worldwide competition so they have to
compete for their existence and profitability that require them to engage in export and import
activities and remittance for their financial transaction worldwide. Banks are the batter
financial intermediaries to complete those activities.
One of the largest businesses carried out by the commercial bank is foreign trading. Foreign
trade can be easily defined as a business activity, which crosses national boundaries. These
may be between parties or government ones. No country can produce all kinds of goods.
From this sense; this is the origin of foreign trade. When two countries exchange goods or
services between them we can call it foreign trade. The trade among various countries falls
for close link between the parties dealing in trade International trade demands a flow of
goods from seller to buyer and of payment from buyer to seller. In this case the bank plays a
vital role to bridge between the buyer and seller.
National Bank Limited pursues decentralized management policies and gives adequate work
freedom to the employees. This results in less pressure for the workers and acts as a
motivational tool for them, which gives them, increased encouragement and inspiration to
move up the ladder of success. Overall, I have experienced a very friendly and supporting
environment at National Bank Limited, which gave me the pleasure and satisfaction to be a
part of them for a while. While working in different departments of this branch I have
found each and every employee too friendly to us to cooperate. They have discussed in
details about their respective tasks. I have also participated with their works.

2
1.2 Origin of the Study

Education system will be more rich and helpful when there is a combination of theoretical
and practical relationship with a student. From education the theoretical knowledge is
obtained from courses of study, which is only the half way of the subject matter. Practical
knowledge has no alternative. The perfect coordination between theory and practice is of
paramount importance in the context of the modern business world in order to resolve the
dichotomy between these two areas. Therefore, an opportunity is offered by Port City
International University, for its potential business graduates to get three month practical
experience, which is known as “Internship Program”. To complete of the internship program,
I was placed in a bank namely, “National Bank Ltd, Chawkbazar Branch, Chattogram”, in
Foreign Exchange department for my practical execution. Internship Program brings a
student closer to the real life situation and thereby helps to launch a career with some prior
experience.
Foreign Exchange Activities of National Bank a leading & outstanding commercial based
bank in the area of banking business, gives many fresh graduates an opportunity to get a real
taste of actual banking activities of various departments every year. According to the needs &
demands of the society & the country as a whole the bank invests money to different update
business sectors. The Bank participates different activities aiming at creating jobs,
implementing development projects taken by the Government and developing infrastructure.
1.3 Background of the Study
National Bank Ltd, Chawkbazar Branch, Chattogram is one of the leading private
commercial bank having a spread network of 200 branches situated in 53 districts in
Bangladesh. across Bangladesh and plans to open few more branches to cover the important
commercial areas in Dhaka, Chattogram, Sylhet and other areas in 2022. It performs all the
modern banking activities to satisfy its clients. This study attempts to analyze the
performance evaluation and foreign exchange activities of National Bank Ltd.

3
1.4 Objectives of the Study
The main objective is to get a clear cut idea about procedures of foreign exchange
department, how its run its operations step by step every day. Along with the main objective
other objective of report are following

 To provide an overview of National Bank Ltd.

 To know the foreign exchange activities of National Bank Ltd.
 To analysis the performance of foreign exchanges activities of
National Bank Ltd.
 To find out the problems face by the firm & to provide some probable
solution to overcome the situations.
1.5 Scope of the Study

The study focuses on the foreign exchange operations and performance of National Bank
Ltd, Chawkbazar Branch, Chattogram. The study was wide spread and has greater scope to
focus on different aspect of foreign exchange on banking sector but the study probably will
not reflect the practices in the overall banking sector. Bangladesh is considered as a
developing country in the world. The economy of this country has a lot left to go further and
there are lots of scopes for massive improvement. In an economy like Bangladesh, Foreign
Exchange can play a major role to improve the economic condition of the country. The banks
play the role of an intermediary that can mobilize the excess fund from surplus sectors. to
provide necessary financing, to those sectors, which need a proper go ahead for sound
development of the economy. It focuses on:

 An overview of National Bank Ltd.

 An overview of foreign exchange activities of National Bank Ltd.
 Import and Export procedure of National Bank Ltd.
 Foreign Exchange performance of National Bank Ltd.

4
1.6 Methodology of the Study

This report is prepared by two sources

 Primary Sources.
 Secondary Sources.
Primary Sources: Basically this type of Sources included interviews with the bankers
National Bank Ltd.

Secondary Sources: Secondary data were collected in the following ways:

 Data gathered within the organization itself.

 Data gathered from Texts.
 Internet sources.
 General reports.
 Annual reports.
 Official documents.
 Foreign exchange manual of the bank.

1.7 Limitations of the Study

In this report I have tried to use, as much as information possible but in some cases I faced
some problems. They are mention below
 A period of only 3 months was not enough to collect and understand the insights of
financial performance.
 Bank’s policy did not permit to disclose various data and information.
 The information was not enough. Lacking of some essential footnotes hampered my
work in some steps.

5
 Chapter 2
Overview of
National Bank Limited

6
2.1 History and Heritage
National Bank Limited has its prosperous past, glorious present, prospective future and
under processing projects and activities. Established as the first private sector bank fully
owned by Bangladeshi entrepreneurs, NBL has been flourishing as the largest private sector
Bank with the passage of time after facing many stress and strain. The members of the board
of directors are creative businessmen and leading industrialists of the country. To keep pace
with time and in harmony with national and international economic activities and for
rendering all modern services, NBL, as a financial institution, automated all its branches
with computer networks in accordance with the competitive commercial demand of time.
Moreover, considering its forth-coming future, the infrastructure of the Bank has been
rearranging. The expectation of all class businessmen, entrepreneurs and general public is
much more to NBL. At present we have 204 branches under our branch network. In addition,
our effective and diversified approach to seize the market opportunities is going on as
continuous process to accommodate new customers by developing and expanding rural,
SME financing and offshore banking facilities.
The emergence of National Bank Limited in the private sector was an important event in the
Banking arena of Bangladesh. When the nation was in the grip of severe recession, the
government took the farsighted decision to allow the private sector to revive the economy of
the country. Several dynamic entrepreneurs came forward for establishing a bank with a
motto to revitalize the economy of the country.
National Bank Limited was born as the first hundred percent Bangladeshi owned Bank in the
private sector. From the very inception, it was the firm determination of National Bank
Limited to play a vital role in the national economy. We are determined to bring back the
long forgotten taste of banking services and flavors. We want to serve each one promptly
and with a sense of dedication and dignity. National Bank, has now acquired strength and
expertise to support the banking needs of the foreign investors. NBL stepped into a new
arena of business and opened its Off Shore Banking Unit at Chattogram to serve the wage
earners and the foreign investors better than before.
2.2 National Bank Limited at a Glance
National Bank Limited has its prosperous past, glorious present, prospective future and
under processing projects and activities. Established as the first private sector bank fully
owned by Bangladeshi entrepreneurs, NBL has been flourishing as the largest private sector

7
Bank with the passage of time after facing many stress and strain. The members of the board
of directors are creative businessmen and leading industrialists of the country. To keep pace
with time and in harmony with national and international economic activities and for
rendering all modern services, NBL, as a financial institution, automated all its branches
with computer networks in accordance with the competitive commercial demand of time.
Moreover, considering its forth-coming future, the infrastructure of the Bank has been
rearranging. The expectation of all class businessmen, entrepreneurs, and the general public
is much more to NBL. At present, we have 204 branches. In addition, our effective and
diversified approach to seize the market opportunities is going on a continuous process to
accommodate new customers by developing and expanding rural, SME financing and
offshore banking facilities.
The emergence of National Bank Limited in the private sector was an important event in the
Banking arena of Bangladesh. When the nation was in the grip of severe recession, the
government took the farsighted decision to allow the private sector to revive the economy of
the country. Several dynamic entrepreneurs came forward for establishing a bank with a
motto to revitalize the economy of the country.
National Bank Limited was born as the first hundred percent Bangladeshi owned Bank in the
private sector. From the very inception, it was the firm determination of National Bank
Limited playing a vital role in the national economy. We are determined to bring back the
long forgotten taste of banking services and flavors. We want to serve each one promptly
and with a sense of dedication and dignity.
The then President of the People's Republic of Bangladesh Justice Ahsanuddin Chowdhury
inaugurated the bank formally on March 28, 1983, but the first branch at 48, Dilkusha
Commercial Area, Dhaka started commercial operation on March 23, 1983. The 2nd Branch
was opened on 11th May 1983 at Khatungonj, Chattogram. At present, NBL has been
carrying on business through its 203 branches & Agri Branches spread all over the country.
Since the very beginning, the bank has exerted much emphasis on overseas operations and
handled a sizable quantum of homebound foreign remittance. It has drawing arrangements
with 415 correspondents in 75 countries of the world, as well as with 37 overseas Exchange
Companies located in 13 countries. NBL was the first domestic bank to establish agency
arrangements with the world famous Western Union in order tofacilitate quick and safe
remittance of the valuable foreign exchanges earned by the expatriate Bangladeshi nationals.

8
This has meant that the expatriates can remit their hard-earned money to the country with
much ease, confidence, safety and speed.
NBL was also the first among domestic banks to introduce international Master Card in
Bangladesh. In the meantime, NBL has also introduced the Visa Card and Power Card. The
Bank has in its use the latest information technology services of SWIFT and REUTERS.
NBL has been continuing its small credit program for disbursement of collateral free
agricultural loans among the poor farmers of Barindra area in Rajshahi district for improving
their livelihood.
NBL focused on all key areas covering capital adequacy, maintaining good asset quality,
sound management, satisfactory earnings, and liquidity. As a consequence, it was possible to
a record growth of 175.51 percent with Tk. 8,809.40 million pre-tax profit in the year under
review over the preceding year. The net profit after tax and provision stood at Tk. 6,860.34
million which was Tk. 2,070.47 million in the previous year registering a 231.34 percent
rise. The total deposits increased to Tk. 102,471.83 million being 33.37 percent increase
over the preceding year. Loans and advances stood at Tk.92,003.56 million in the year under
report which was Tk. 65,129.289 million representing 41.26 percent rise over the preceding
year. Foreign trade stood at Tk. 144,255.00 million in 2019 compared to Tk. 115,939.00
million, increased by 24.42 percent compared to that of the previous year. During 2019, the
bank handled inward remittance of Tk. 49,145.30 million, 10.73 percent higher than that of
the previous year. Return on Equity (ROE) registered a 77.84 percent rise over the preceding
year. National Bank, has now acquired strength and expertise to support the banking needs
of the foreign investors. NBL stepped into a new arena of business and opened its Off Shore
Banking Unit at Mohakhali to serve the wage earners and the foreign investors better than
before. Since its inception, the bank was aware of complying with Corporate Social
Responsibility. In this direction, we have remained associated with the development of
education, healthcare and have sponsored sporting and cultural activities. During times of
natural disasters like floods, cyclones, landslides, we have extended our hand to mitigate the
sufferings of victims. It established the National Bank Foundation in 1989 to remain
involved with social welfare activities. The foundation runs the NBL Public School &
College at Moghbazar where present enrolment is 1140.
Besides awarding the scholarship to the meritorious children of the employees, the bank has
also extended financial support for their education. It also provided financial assistance to

9
the Asiatic Society of Bangladesh at the time of their publication of Banglapedia and
observance of 400 years of Dhaka City.The Transparency and accountability of a financial
institution are reflected in its Annual Report containing its Balance Sheet and Profit & Loss
Account. In recognition of this, NBL was awarded Crest in 1999 and 2000, and Certificate
of Appreciation in 2001 by the Institute of Chartered Accountants of Bangladesh.The bank
has a strong team of highly qualified and experienced professionals, together with an
efficient Board of Directors who play a vital role in formulating and implementing policies.
2.3 Vision and Mission
Every men has mission and vision which they reach expected aim. As men or persons
manage, operate or maintain their company or business, also company or business has vision
and mission. By this vision and mission we can easily gain our dream or expected aim step
by step.
2.3.1 National Bank Limited Vision and Mission
Vision
Ensuring highest standard of clientele services through best application of latest information
technology, making due contribution to the national economy and establishing ourselves
firmly at home and abroad as a front ranking bank of the country are our cherished vision.
Mission
Efforts for expansion of our activities at home and abroad by adding new dimensions to our
banking services are being continued unabated. Alongside, we are also putting highest
priority in ensuring transparency, account ability, improved clientele service as well as to
our commitment to serve the society through which we want to get closer and closer to the
people of all strata. Winning an everlasting seat in the hearts of the people as a caring
companion in uplifting the national economic standard through continuous up gradation and
diversification
of our clientele services in line with national and international requirements is the desired
goal we want to reach
2.4 Objectives of National Bank limited

Their objectives are to conduct transparent and high quality business operation based
on market mechanism within the legal and social framework.

Their greatest concerns are to provide their customers continually efficient,
innovative and high quality products with excellent delivery system.

10
 
Their motto is to generate profit with qualitative business as a sustainable ever-
growing organization and enhance fair returns to the shareholders.

Be committed to the community as a corporate citizen and contribute towards the
progress of the nation

Build a strong deposit base.

Introduce new products & services and upgrade existing products & services at
comparatively low cost in order to assure quick respond to the changing demands in
the market

Promote the well being of the employees and raise their morale

Proper combination of loan and deposit

Strengthen corporate identity and values

Fulfillment of their responsibility to the government by paying taxes and abiding by
other rules

Bring the entire system under a very advanced IT platform

Socialize and present the bank to the community as a corporate partner

Encouraging and motivating the new entrepreneurs to establish industries and
business in line with development of national economy.

Enhancing savings tendency of the people by offering attractive and lucrative new
savings scheme.

Financing the foreign trade of the country both Export and Import.

Enhancing the mobilization of savings both from urban and rural area.
The prime objective of NBL is to deliver a quality that demonstrates a true reflection of their
vision and mission Excellence in Banking. Improve the quality of lone and services, and
diversify the sources of revenue.
➢
Focus on Current, Savings & Short Term Deposit Accounts to reverse the ratio
(30:80) with Fixed Deposit Receipt.
➢
Take immediate action required to reverse the rise of Cost of Fund.
➢
Increase fee based income: increase volume & fee of Letter of Credit & Guarantee,
increase export and exchange earnings.
➢
Reduce operating cost by at least 30%.
➢
Better customer service and expand their service whole home and abroad.

11
2.5 Organizational Strategy
As the financial services industry is a very competitive industry, the main strategy of NBL is
the organic growth – to build branches and strengthen their distribution network. They will
continue to invest and expand in Bangladesh as fast as local regulations allow. The principal
strategies are:

People Attract, retain and reward top performers

Profitable growth Growing sales and increase the revenues

Execution Performing with skill and speed

Credit quality Maintaining credit quality and understand the role in

managing losses.

Customer Centered Always providing exceptional customer service

Ownership The performance and result should be owned

Efficiency Lowering the cost and wise use of resource

2.6 Division of National Bank Limited

➢
Audit & Inspection Division.
➢
ATM Card Division
➢
Board Secretariat
➢
Budget & Monitoring Division.
➢
Credit Division-1.
➢
Credit Division-2.
➢
Credit Card Division.
➢
Classified Loan Recovery Division.
➢
Financial Administration Division.
➢
General Banking Division.
➢
Human Resources Division.
➢
International Division.
➢
Information System & Technology Division.
12
2.7 Services of National Bank Limited
We provide the following range of services:-
➢
Strategic planning and organizational development
➢
Faculty and departmental operational advice support and services
➢
Staff development
➢
Projects and information management
2.8 Management Hierarchy of National Bank Limited

13
2.9 SWOT Analysis of National Bank Limited

Strengths Weakness

Opportunities Threats

Strategic Director and the Challenges of the Bank

Although the immediate outlook for the local operating environment is expected to be
turbulent, the Bank intends to continue its growth momentum through the initiatives
and strategic priorities set out in the Corporate Plan. The Bank is well positioned to
mitigate the risks posed by the potential volatility of microeconomic conditions in the
country. The Corporate Plan and the Budget is a midterm plans, yet to being prepared
annually covering a period of five years on a rolling basis. This year the Bank
prepared the plan for the period covering the year 2020-2019. The strategic direction
of the Bank is critically reviewed by the Management as well as by the Board at the
time of preparing and approving the Corporate Plan and the Budget. In keeping with
the mission at statement of the Bank, the strategic direction has been clearly identified
and laid down in the Corporate Plan. It detailed out SWOT analysis of the Corporate
Banking, Personal Banking, Treasury, Information Technology, Human Resources
Management and Bangladesh Operations of the Bank. Besides,its pells out Goals and
Objectives of these main segments along with detailed action plans with specific time
frames to achieve them. The Corporate Plan and the Budget incorporates highly
ambitious targets for the planned period. Undoubtedly, the Corporate Plan and the
budget has immensely Contributed in guiding the organization to its present level.
Further, it has contributed to building up the target driven culture the organization and
leading to record superlative performance and to maintain the pre eminent position in
the banking industry.
14
2.10 Products of National Bank Ltd
Products
 Deposit Products.
 Credit Products.
 Internet Banking.
 Service Location.
Cards
 Debit Card.
 Credit Card.
 NBL Card.
2.11 Board of Directors

Name Position
Monowara Sikder Chairman
Parveen Haque Sikder Director
Khalilur Rahman Director
Rick Haque Sikder Director
Ron Haque Sikder Director
Zakaria Taher Director
Naimuzzaman Bhuiyan Mukta Independent Director

Md. Mehmood Husain CEO and Managing Director

2.12 Corporate Strategies of National Bank Ltd

“Customer relationships are key to our strategy and important for all our businesses.
The significant differences across the divisions/businesses means financial and non-
financial strategic indicators for the development of customer relationships are tracked
at a divisional level and commentary is included in the specific divisional
commentaries.” Our corporate strategy supports the Bank’s vision of being making
due contribution to the national economy and establishing ourselves firmly at home
and abroad as front ranking bank through providing best financial services. The
strategy is focused on being a more conservative, ‘through the cycle’ relationship
based business. We are a well diversified financial services company and have largest
branch network and to provide Banking services among the corporate, retail & SME

15
sectors. We have leading positions in many of the markets in which we participate
specially SME and Agriculture Sector, a market leading distribution capability, well
recognized brands and a large customer base are the main drivers. The scale of the
organization provides us with the opportunity to further invest in products and
services, systems and training that combined will offer unparalleled choice and service
to our customers.
2.13 Banking Department of National Bank Ltd
Banking Department of National Bank Limited
 Account opening Department
 Clearing Department
 Remittance Department
 Deposit Department
 Cash Department
 Accounts Department
 Loan & Advance Department
2.14 Corporate Social Responsibility
As per the CSR expenditure guideline of the Bangladesh Bank, banks can spend for
philanthropic purposes from their net profits and there is no limit on expenditure. The
expenditure will be participatory and not mandatory. NBL being a responsible
corporate entity of the country has been playing an important role in implementing
various social and charitable activities. The amount of its donation towards charitable
work has always been increasing since inception. During the year under review, NBL
retained its collective concentration on activities for community welfare through CSR
initiatives. The Bank has provided financial support directly or in partnership with
others in wider area of social life including disaster management, health Education,
Sports & culture, community development etc. at home & abroad.
2.15 Shares of NBL
The Authorized Capital of the Bank stood at BDT 50,000.00 million while the paid-up
capital is BDT 30,664.19 million as of December 31, 2021. NBL’s shares are being
maintained with Central Depository System since 2004. A total number of 3,034.68
million shares have been recorded with the CDS (Central Depository System) while
31.74 million shares remained in script till 31.12.2020. The net asset value (NAV) per

16
share was Tk. 16.99 in 2020 which was Tk. 16.79 in 2019. The earnings per share
(EPS) was Tk. 1.14 in 2020 which was Tk.1.36 in 2019. Though capital market
showed ups and downs, NBL shares are still admired by the investors due to the inner
financial strength of the Bank.
2.16 Effective risk management for NBL
Accepting calculative risk is a beauty of the banking business. Effective management
of risks is therefore critical for sustainable performance of a Bank. As businesses are
changing, which brings new risk horizons, NBL is coping with the changes brought
about by an ever evolving economy at the same time. The ability to anticipate threats,
respond and continually adapt is as critical a part of the risk management process as it
ever has been. In the course of banking operations, banks are invariably faced with
different types of risks that may have a potentially negative effect on their business.
When banks deal with risks in banking, banks are primarily concerned with the
possibilities of loss or decline in asset values from events like economic slowdowns,
unfavorable fiscal and trade policy changes, adverse movement in interest rates or
exchange rates, or falling equity prices. Risk management in bank operations includes
risk identification, measurement and assessment, and its objective is to minimize
negative effects risks can have on the financial result and capital of a bank. NBL is
therefore required to form a special organizational unit for risk management. Also,
NBL needs to prescribe procedures for risk identification, measurement and
assessment, as well as procedures for risk management.
2.17 Green Banking of NBL
The world has seen much focus on economic progress and mankind has made giant
steps in its journey through time. The side effects of the development process have,
however, also been equally enormous – loss of biodiversity, climatic change,
environmental damage, etc. Social issues such as, poverty alleviation have also
become more important as the world has progressed economically.
2.18 Conclusion
Over the past year, NBL team has worked relentlessly towards strengthening the
Bank’s and it’s subsidiaries financial statements, and increasing the Bank’s share of
profitable business opportunities. We believe these efforts are reflected in the core
operating profit growth, the substantial increase in provisioning coverage and the

17
reduction in net NPAs. As Bangladesh continues its journey to become an
economically developed country in the future, we will work towards maximizing our
share of the opportunity. Our objective is to grow our core operating profit and to
reduce the credit costs to a normalized level, thereby delivering sustainable returns to
our shareholders. We are aware that COVID19 has brought a ravage in our economy;
our government is trying to salvage the overall economy with strong and prudent
leadership. We all are now trying to cope with the pandemic which has created an
unprecedented scenario. Strong rapport of the public and private will help us to get rid
of the tottering economy, springing back into our desired growth trajectory.
Nevertheless, I take this opportunity to thank my colleagues in the board for their
continued support and contributions in moving the Bank to the right direction. I also
convey my thanks to all employees, without their hard work, this success would not
have been possible. My special gratitude to Bangladesh Bank, Bangladesh Securities
and Exchange Commission, Dhaka and Chittagong Stock Exchanges, Central
Depository Bangladesh Limited, borrowers, depositors and other stakeholders who
always give us their valuable advice, guidance and cooperation as & when needed.
And let us not forget to thank our shareholders whose trust placed on us at all time in
our pursuit for excellencies of immense value.

18
 Chapter Three
Theoretical Aspects of Foreign
Exchange

19
3.1 Foreign Exchange
By Foreign Exchange we mean foreign currencies or, more commonly, claims to foreign
money balances. It includes all monetary instruments which give residents of one country
a financial claim on another country. The use of foreign exchange is a country’s principal
means of settling its transactions with other countries.
In the broader sense, the foreign exchange is related to the mechanism of foreign
payments. It refers to the system whereby one currency is exchanged for or converted
into another Foreign exchange also refers to the global market where currencies are
traded virtually around-the-clock. The term foreign exchange is usually abbreviated as
"forex" and occasionally as "FX."

3.2The History of Foreign Exchange

The Forex trading history started in 1875 with the birth of the gold standard monetary.
Prior to 1875, countries primarily used gold and silver as a form of international payment.
Payment using gold and silver were hampered by their devaluation according to external
factors such as an increase in the discovery of new deposits, which would lead to a
change in supply and demand. This factor would change the Forex trading history
forever.
The aim of the implementation of the gold standard was to guarantee any currency, to set
amount of gold. Currency was now backed by gold, measured in ounces. Countries
needed large gold reserves to back the demand for currency. The price difference of an
ounce of gold between two different currencies now became the foreign exchange rate for
those two currencies. This History of Forex was changed by the birth of an international
standard by which foreign exchange could take place between countries. The gold
standard monetary broke down during the start of the First World War Political turmoil
with Germany forced the larger European powers to focus on military projects. This
financial drain on Europe gave way to a lack of gold to back the excess printing of
currency and would determine a new change in the FX trading history.

20
The abolishment of the gold standard monetary system left a void in the method of
foreign exchange, and changed the path of Forex history. This matter was a concern to
the Allied countries and a convention were held at Bretton Woods, New Hampshire, in
July 1944, to solve this problem. This convention led to the inception of the Bretton
Woods monetary system.
This new Bretton Woods monetary system defined the new Forex market history:
 A new method of obtaining a fixed foreign exchange rate.
 The US Dollar to be the only currency backed by gold.
 The inception of three international authorities to guard over all foreign transactions.
The Bretton Woods monetary system only lasted about 25 years and failed primarily on
the basis of making the US Dollar the only currency to be backed by gold. The U.S
announced the end of the exchange of gold for US Dollars by foreign banks on 15 August
1971.

3.3Foreign Exchange Regulation Act, 1994

This Act regulates the exchange of foreign currencies, remittances and opening of foreign
currency account under various classifications. According to this law, FC Accounts can
be opened without initial deposits, and bears no interest and both the account holder and
the nominee can operate the account. The entire remittance from adored is free from
income tax. It also states the documents required for the opening of such account.

3.4 Foreign Exchange Market

The foreign exchange market (Forex, FX, or currency market) is a form of exchange
for the global decentralized trading of international currencies. Financial centers around
the world function as anchors of trading between a wide range of different types of
buyers and sellers around the clock, with the exception of weekends. EBS and Reuters'
dealing 3000 are two main interbank FX trading platforms. The foreign exchange market
determines the relative values of different currencies.
The foreign exchange market is unique because of the following characteristics:

21
  Its huge trading volume representing the largest asset class in the world leading to
high liquidity
 Its geographical dispersion
 Its continuous operation: 24 hours a day except weekends, i.e., trading from 20:15
GMT on Sunday until 22:00 GMT Friday
 The variety of factors that affect exchange rates

3.5 Foreign Exchange Rates

A country’s demand for foreign exchange and the supply of foreign exchange available to
it provide a convenient basis for the determination of foreign exchange rate.
There are as many exchange rates as there are currencies traded. At any given moment it
may be regarded as the price of one currency in terms of another. It is more enlightening,
however to look upon the exchange rate as the price not of foreign money but of
documents representing Claims to foreign money. There is, thus, a cluster of rates in the
exchange market and not one rate between any two currencies. Each rate shows some
slight variation from the other rate.
3.5.1 Spot Rate and Forward Rate
The spot rate of exchange is quoted for the immediate delivery of foreign exchange. It is
distinguished from the forward rate which is quoted for the delivery of foreign exchange
at a future date. The spot rate refers to the rate or quotation prevailing at a particular time,
the foreign exchange required being made available on spot. The forward rate, on the
other hand, refers to the rate at which a future contract for foreign currency to buy or to
sell is made on the basis of the spot rates.

3.5.2 Buying rates and selling rates

Under the exchange control system, when the government or the central bank of the
country hold full control over the purchase and sale of foreign exchange, two different
rates may be fixed for buying and selling foreign currencies.

22
3.5.3 Single rate and multiple rates
Ordinarily, the government of a country adopts a single rate vis-à-vis the currency of
another country. But in certain circumstances it may adopt more than one rate- two or even
three rates vis-à-vis another currency. This is known as the system of multiple exchange
rates. There may be one rate for exports, one rate for imports and still another for capital
transactions.

3.5.4 Fixed, Flexible and Floating rates

Fixed exchange rate refers to that rate which is fixed in terms of gold or is pegged to another
currency which has a fixed value in terms of gold. Flexible exchange rate involves keeping
the exchange rate fixed over short periods but allowing it to change from time to time
according to the changed conditions of demand for and the supply of foreign exchange.
Floating exchange rate is that which finds the natural price of the currency in accordance
with the demand and supply conditions in relation to a foreign currency.

3.6 Risk in foreign exchange

Foreign exchange risk (also known as FX risk, exchange rate risk or currency risk) is a
financial risk that exists when a financial transaction is denominated in a currency other than
that of the base currency of the company. Foreign exchange risk also exists when the foreign
subsidiary of a firm maintains financial statements in a currency other than the reporting
currency of the consolidated entity. The risk is that there may be an adverse movement in the
exchange rate of the denomination currency in relation to the base currency before the date
when the transaction is completed. Investors and businesses exporting or importing goods
and services or making foreign investments have an exchange rate risk which can have
severe financial consequences; but steps can be taken to manage (i.e., reduce) the risk. There
are three types of foreign exchange risk:
Transaction risk: This is the risk that a company faces when it's buying a product from a
company located in another country. The price of the product will be denominated in the
selling company's currency. If the selling company's currency were to appreciate versus the

23
buying company's currency then the company doing the buying will have to make a larger
payment in its base currency to meet the contracted price.
Translation risk: A parent company owning a subsidiary in another country could face
losses when the subsidiary's financial statements, which will be denominated in that
country's currency, have to be translated back to the parent company's currency.
Economic risk: Also called forecast risk, refers to when a company’s market value
Is continuously impacted by an unavoidable exposure to currency fluctuations

3.7 Concepts
Foreign Exchange Department of National Bank, Chawkbazar Branch has two sections. They are
I. Import Section and
II. Export Section.
Before discussing the Import and Export section, some concepts related to foreign trade
should be clarified.
Important concepts of foreign trade as per UCPDC 600 are discussed below:
Importer / Buyer/ Opener/ Applicant:
Applicant means the party on whose request the credit is issued.
Issuing/ opening bank:
Issuing bank means the bank that issues a credit at the request of an applicant or on its own

Exporter/ seller/ beneficiary:

Beneficiary means the party in whose favor a credit is issued.
Advising / notifying bank:
Advising bank means the bank that advises the credit at the request of the issuing bank.
Confirming bank:
Confirming bank means the bank that adds its confirmation to a credit upon the issuing
bank’s authorization or request.

Confirmation:
Confirmation means a definite undertaking of the confirming bank, in addition to that of

24
issuing bank, to honor or negotiate a complying presentation.

Complying presentation:
Complying presentation means a presentation that is in accordance with the terms and
conditions of the credit, the applicable provisions of these rules and international standard
banking practice.
Negotiating bank:
The bank that negotiates the bill (draft) of exporter drawn under the credit is known as
Negotiating bank. If the advising bank is also authorized to negotiate the bill (draft)
drawn by the exporter then it becomes the negotiating bank.

Reimbursing bank:
If the issuing bank does not maintain any account with a bank who will be negotiating
documents under a L/C, then arrangement is made to reimburse the negotiating bank for
the amount to be paid under credit from some other bank with which the issuing bank
maintains his account. The latter bank is termed as reimbursing bank. An authority to
debit his account is sent to the bank where he holds balance advising to honor claims
placed by a negotiating bank.

Paying bank:
The bank that effects payment to the beneficiary (as named in the latter of credit) is
known as paying bank/drawee bank.
Letter of Credit:
Credit means any arrangement however named or described, whereby a bank (issuing
bank) acting at the request and the instructions of a customer (the applicant) or of its own
behalf.

1). is to make payment to or to the order of a third party (beneficiary), or is to accept and
pay bill of exchange (drafts) drawn by the beneficiary.

2) Authorizes another bank to effect such payment, or to accept and pay such bill of

25
exchange. 3). Authorizes another bank to negotiate.
Against stipulated documents, provided that the terms and conditions of the credit are
complied with.

Types of L/C or Documentary Credit

Documentary Credits may be either:
(i) Revocable
(ii) Irrevocable.
Revocable credit: A revocable credit is a credit that can be amended or cancelled by the
issuing bank at any time without prior notice to the seller. In case of seller (beneficiary),
revocable credit involves risk, as the credit may be amended or cancelled while the goods
are in transit and before the documents are presented, or although presented before
payments has been made. The seller would then face the problem of obtaining payment
on the other hand revocable credit gives the buyer maximum flexibility, as it can be
amended or cancelled without prior notice to the seller Up to the moment of payment buy
the issuing bank at which the issuing bank has made the credit Available, in the modern
banking the use of revocable credit is not widespread.
Irrevocable credit: An irrevocable credit constitutes a definite undertaking of the issuing
bank(since it cannot be amended or cancelled without the agreement of all parties
thereto), provided that the stipulated documents are presented and the terms and
conditions are satisfied by the seller. This sort of credit is always preferred to revocable
letter of credit. Sometimes, Letter of Credits is marked as either 'with recourse to drawee
or 'without recourse to drawer'.

Some Important Documents of L/C or Documentary Credit:

Forwarding: Forwarding is the letter given by the advising bank to the issuing bank.
Several copies are sent to the issuing bank. All copies including original should be kept
in the bank.
Bill of Exchange: According to the section 05, Negotiable Instruments (NI) Act-1881,

26
A "bill exchange" is an instrument in writing containing an unconditional order signed by
the maker, directing a certain person to pay [on demand or at fixed or determinable future
time] a certain sum of money only to or to the order of a certain person or to the bearer of
the instrument. It may be either at sight or certain day sight. At sight means making
payment whenever documents will reach in the issuing bank.

Invoice: Invoice is the price list along with quantities. Several copies of invoice are given.
Two copies should be given to the client and the other copies should be kept in the bank. If
there is only one copy, then its photocopy should be kept in the bank and the original copy
should be given to the client. If any original invoice contains the custom's seal, then it
cannot be given to the client.

Packing List: Packing list is the letter describing the number of packets and size. If there
are several copies, then two copies should be given to the client and the remaining should
be kept in the bank. But if there is only one copy, then the photocopy should be kept in the
bank and the original copy should be given to the client.

Bill of Lading: Bill of Lading is the bill given by shipping company to the client. Only one
copy of Bill of Lading should be given to the client and the remaining copy should be kept
in the bank.

Certificate of Origin: Certificate of origin is a document describing the producing country

of the goods. One copy of the certificate of origin should be given to the client and the
remaining copy should be kept in the bank. But if there is only one copy, then the
photocopy should be kept in the bank and the original should be given to the client.

Shipment Advice: The copy mentioning the name of the insurance company should be
given to the client and the remaining copies should be kept in the bank. But if only one
copy is given, then the photocopy should be kept in the bank and the original copy should
be given to the bank.

27
IMP-Form

This form is prepared for maintaining account of the money, which goes outside the
country for the purpose of payment. This form is required by Bangladesh Bank. It is an
application for permission under 4/5 of the Foreign Exchange Regulation Act, 1947 to
purchase foreign currency for the payment of import.

IMP - FORM has four copies:

 Original copy for Bangladesh Bank.
 Duplicate copy for authorized dealers. It is issued for processing Exchange
Control Copy of bill of entry or certified invoice.
 Triplicate copy for authorized dealers' record.
 Quadruplicate copy for submission to the bank in case of imports where documents
are retired.

Following documents are sent with FORM-IMP:

a) Letter of Credit Authorization Form,
b) One copy of invoice,
c) Indent copy / Pro-forma invoice.
The following Information is included in the FORM-IMP:
i. Name and address of the authorized dealer,
ii. Amount of foreign currency in words and figures,
iii. Names and address of the beneficiary,
iv. L/C Authorization Form number and date,
v. Registration number of L/C Authorization Form with Bangladesh Bank, and
vi. Description of the goods.

3.8 Import Section

Import may be defined as bringing of visible item to the country from abroad through
letter of credit or the Authorization form (LCAF) paying foreign Currency to that of

28
exporting country.
Import Mechanism
To import, a person should be competent to be Importer‗. According to Import and
Export Control Act, 1950, the Office of Chief Controller of Import and Export provides
the Import Registration Certificate (IRC) to the importer. After obtaining this, person has
to secure a Letter of Credit Authorization (LCA). And then a person becomes a qualified
importer. He is the person who requests or instructs the opening bank to open an L/C. He
is also called opener or applicant of the credit.
Parties of L/C or Documentary Credit the parties are:
 The Importer
 The Issuing Bank,
 The Confirming Bank, if any, and
 The Beneficiary.

Things Are Done In Import Mechanism

In broader aspect the major responsibilities that are performed here are —
 L/C Issuing.
 L/C Amendment (if necessary)
 Lodgment.
 Retirement of documents.
 Import Financing.
L/C Issuing:
This is the first thing to be done for import. Already the definition of L/C is discussed. Now,
The important types of L/C are discussed below:
There are three types of L/C offered by Chawkbazar Branch, National Bank Ltd.
They are:
1. Sight L/C: Payment must be made within five (5) working days after the
documents have been received from the exporter.
2. Differed / Usance L/C: Payment must be made on or after the due date i.e.

29
 shipment date or Bill of Lading date. Differed L/C usually opened for 90 days.
3. Back -to -Back L/C: Usually, this L/C is opened by the exporter. If exporter
needs to import goods or equipments to manufacture the ordered goods, then he
may import those goods or equipments by opening a L/C against this mother L/C.
The value of the back-to- back L/C can be 80 percent of the mother L/C.
• Applicant has to submit LCAF (Letter of Credit Authorization Form)
• Applicant has to submit insurance document.
• Applicant has to prepare FORM-IMP.
• Recently, there has been made a provision to give a certificate
named TIN (Tax Payers Identification Number).Taxation
department issues this certificate.
• Then after proper scrutiny bank will open an L/C.

3.9 Export Section:

The goods and services sold by Bangladesh to foreign households, businessmen and
Government are called export.

Things Done in Export

In broader aspect the major responsibility that re performed here are —
 L/C Advising
 Documents Collection
 Documents negotiation
 Export financing

Parties Involves In Export L/C

1. L/C issuing Bank
2. Importer
3. Exporter L/C advising Bank
4. Negotiation Bank
5. The Paying / Reimbursing Bank

30
Documents Required for Export Letter of Credit
These documents should be submitted to the bank for negotiation:
 Export L/C EXP form
 Pro-forma invoice
 Certificate of origin
 Bill of Lading
 Packing list
 Inspection certificate Insurance document
 Any other document as per L/C
Procedure for Export Letter of Credit
There are a number of formalities that require to procedure of Export Letter of Credit:
 ERC (Export Registration Certificate)
 Obtaining EXP
 Securing the Order
 Signing of the Contract
 Procuring the Materials
 Shipment of Goods
 Settlement of Local Bill to Back to Back
 Auxiliary Document
 Negotiation of Documents under Letter of Credit
 Mode of Payment of Export Bill under Letter of Credit
 Export Financing
Kind of Export Business Related to Letter of Credit
 Garments
 Shrimpfish
 Jute
 Others

31
3.10 Foreign Remittance
National Bank Ltd, Chawkbazar Branch is an authorized dealer of foreign exchange.
Their dealing in foreign exchange involves buying and selling of foreign exchange
covering inward remittances received from abroad and outward remittances sent abroad.
The basic functions of this department are outward and inboard remittance of foreign
exchange from one country to another country. In the process of providing this remittance
service, it sells and buys foreign currency. The conversion of one currency into another
takes places at an agreed rate of exchange, in where the banker quotes, one for buying
and another for selling. In such transactions the foreign currencies are like any other
commodities offered for sales and purchases, the cost being paid by the buyer in home
currency, the legal tender.

Working of this Department

 Foreign TT payment &purchase of F. Drafts, preparations of FBP
(Foreign Bill Purchase)
 Issuance of outward TT & FDD
 Issuance of proceed responding certificate (PRC)
 Withdrawal from F.C. A/C
 Encashment of T.C & Cash Dollar and Sterling Pound
 Deduction of Tax and VAT. On behalf of Bangladesh Bank
 Preparation of related statements including convertible Take Accounts
 Preparation of IBCA & IBDA and balancing of collection and other special
assignment as desired by department in charge
 Balancing of account statement
 Statement of all related works submitted to Bangladesh Bank

There are two types of remittance:

1. Inward remittance
2. Outward remittance
32
3.10.1 Inward Foreign Remittance
Inward Foreign Remittance covers purchase of foreign currency in the form of foreign
TT, DD, MT, Bills etc. sent from aboard favoring a beneficiary in Bangladesh. Purchase
of foreign exchange is to be reported to exchange control department of Bangladesh Bank
prescribing two forms:
 EXP from: Remittances received against export of goods from Bangladesh are
done by this.
 From C: Inward remittances equivalent to US$ 2000/- and above are done by this.

3.10.2 Outward Foreign Remittance

Outward Foreign Remittance covers sales of foreign currency though issuing foreign T.T,
Drafts, Travelers Check etc. as well as sell of foreign exchange under L/C and against
import bills retired. Two forms are used for outward remittance of foreign currency are:
 IMP Form: All Outward Remittance on account of imports
 TM: For all other Outward Remittances
3.10.3 Remittance Facilities
Private Remittances:
 Family remittances facilities
 Remittances of membership fees
 Education
 Remittances of consular fees
 Remittances of evaluation fees
 Travel
 Health & medical
 Seminars & workshops
 Foreign nationals
 Remittances for Hajj
 Other private Remittances

33
Official and Business Travel
 Official visit
 Business travel quota for new exporter
 Business travel quota for importer
 Exporter retention quota

Commercial Remittances
 Opening of branches or subsidiary companies abroad.
 Remittances by shipping, airlines and courier services.
 Remittance for royalty and technical fees.
 Remittance on account of training & consultancy.
 Remittance of dividends.
 Subscription of foreign media services.
 Fees for return monitors.
 Adv. of Bang. Products in mass media abroad.
 Bank charges.
 Sundries.

34
 Chapter Four
Performance Analysis of
National Bank Ltd

35
4.1 Data Analysis
A statement where key operating and financial data of at least preceding 5 (five) years
shall be summarized
Key operating and financial data of at least preceding 5 (five) years are as under

(Taka Fig in Million)

Particulars 2021 2020 2019 2018 2017
1 2 3 4 5 6
Total assets/Total Liabilities 88,403.45 84,564.01 70,661.31 58,940.78 45,599.98

Interest earning assets 75,928.42 73,970.20 63,003.66 53,613.97 41,243.62

Non interest earning assets 12,475.03 10,593.80 7,657.65 5,326.81 4,356.36

Paid up capital 6,846.46 6,224.05 5,658.23 4,985.22 4,334.98

Total deposits 71,451.46 71,540.16 59,304.33 50,121.49 38,337.20

Total loans and advances 57,408.83 56,000.74 50,254.94 43,284.97 30,174.09

Advance deposits ratio 80.31% 78.21% 82.50% 83.99% 78.71%

Total Income 8,317.96 9,200.04 7,873.15 6,266.64 5,269.40

Total Expenses 6,860.29 6,930.86 5,839.31 4,447.35 3,749.51

Profit before tax and provision 1,457.67 2,269.18 2,033.84 1,819.29 1,519.88

Profit after tax and provision 951.95 967.60 879.59 982.04 949.46

Total Import 190753.60 196389.70 184650.00 172773.50 158533.10

Total Export 134752.90 158307.70 163152.30 135418.10 124212.60

Total Remittance 29976.40 35943.00 35239.10 30893.00 26848.60
Return on investment (ROI) 13.64% 11.03% 13.67% 18.19% 18.17%
Return on Assets (ROA) 1.10% 1.25% 1.36% 1.88% 2.31%
Return on Equity (ROE) 10.78% 12.25% 12.40% 16.16% 18.09%

36
4.1.1Total Import
As, All the businesses located near the National Bank, Chawkbazar Branch. Because
National Bank Ltd, Chawkbazar Branch provides fast and quality service to the
customers with proper security. Due to the nature of the businesses located near the
branch, all the import LCs opened here for importing industrial purpose.

Year 2017 2018 2019 2020 2021

Total Import (BDT 190753.60 196389.70 184650.00 172773.50 158533.10

Million)

Total import
250000

200000

150000

100000 Total import

50000

0
2017 2018 2019 2020 2021

Analysis

Bangladesh is an Import dependent economy. In order to meet up the requirements of

commodities, industrial raw materials, capital machinery, etc of the country, the same are
imported from different countries. In the year of 2021, National Bank Ltd. handled
volume of 158533.10 million BDT. Import volume in the year 2020, 2019, 2018 and
2017 was BDT 172773.50 million, BDT 184650.00 million BDT 196389.70 million and
190753.60 million BDT respectively. Total Import increases in 2018 compare with the
year 2017. In 2019 it is slightly decreased and 2020 it is decrease again. In 2021 total
import decreases.

37
4.1.2Total Export
Exports play an important role in any economy which influences the level of economic
growth, employment and the balance of payments. Export and economic growth of a
country is like a lyric in a thread. If export increases at a faster pace as compared to
import, economic development is certain. Lower export contributes lower foreign
exchange thus a lower purchasing capacity of a nation.
Year 2017 2018 2019 2020 2021

Total Export 134752.90 158307.70 163152.30 135418.10 124212.60

(BDT Million)

Total Export
180000
160000
140000
120000
100000
80000 Total Export
60000
40000
20000
0
2017 2018 2019 2020 2021

Analysis
In the year of 2021 National Bank Ltd. handled export documents for BDT 124212.60
million. Export volume in the year 2020, 2019, 2018 and 2017 was BDT 135418.10
million BDT 163152.30 million, BDT 158307.70 million and 134752.90 million
respectively. Total export Position is decreasing in 2021 compare with previous year.

38
4.1.3 Remittance

Remittance is one of the most important sources of foreign exchange earnings for
Bangladesh. The Bank has a well linked legal channel for remittance procurement. As
Bangladesh Bank always encourages scheduled banks to procure remittance through
banking channel, National Bank Ltd. is also committed to bring remittance in flow from
the expatriate Bangladeshis through its network.
Year 2017 2018 2019 2020 2021

Remittance(BDT 29976.40 35943.00 35239.10 30893.00 26848.60

Million)

Remittance
40000
35000
30000
25000
20000
Remittance
15000
10000
5000
0
2017 2018 2019 2020 2021

Analysis
In the year 2021, National Bank received BDT 26848.60 million as wage earners
remittance. Remittance figure was BDT 30893.00 million in the year 2020, BDT
35239.10 million in the year 2019, BDT 35943.00 million in the year 2018.
BDT29976.40 million in the year 2017. Remittance amount is decreasing year by year.

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4.1.4 Foreign Exchange Business

Foreign exchange (also known as FX or forex) market is a global marketplace for

exchanging national currencies. Because of the worldwide reach of trade, commerce, and
finance, forex markets tend to be the largest and most liquid asset markets in the world.
Currencies trade against each other as exchange rate pairs.

Year 2017 2018 2019 2020 2021

Foreign
355482.9 390640.4 383041.4 339085 309594.3
Exchange
Business

Foreign Exchange Business

450000
400000
350000
300000
250000
200000 Foreign Exchange Business
150000
100000
50000
0
2021 2020 2019 2018 2017

Analysis

From the above calculation we can see that Foreign Exchange Business is increasing in
2018 compare with the previous year 2017. But in 2019-2020 it decreases compare with
the year in 2018. In 2021 it was 309594.3 million which means it decrease compare with
the previous years.

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4.2 Society for Worldwide Interbank Financial
Telecommunication (SWIFT)
National Bank Ltd is a member of the society of interbank financial telecommunications.
c.r.l Through this fast, secure, global communication National Bank Ltd has gained 24
hours connectivity with 7000 financial institution in 200 countries for transmission of
L/Cs, Guarantees, funds transfers, payment e. t. c. SWIFT is a bank owned non- profit
co-operative based in Belgium servicing the financial community worldwide. It ensures
secure messaging having a global reach of 6,495 Banks and Financial Institutions in 178
countries, 24 hours a day. SWIFT global network carries an average 4 million message
daily and estimated average value of payment messages is USD 2 trillion.
SWIFT is a highly secured messaging network enables Banks to send and receive Fund
Transfer, L/C related and other free format messages to and from any banks active in the
network.
Having SWIFT facility, Bank will be able to serve its customers more profitable by
providing L/C, Payment and other messages efficiently and with utmost security.
Especially it will be of great help for our clients dealing with Imports, Exports and
Remittances etc.

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 Chapter Five
Findings, Recommendations
& Conclusion

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5.1 Findings

The bank has many more positive sides. Besides this, there are also some shortcomings

and subsequently recommendations are given below to smooth the banking operation.

 Total Import increases in 2018 compare with the year 2017. In 2019 it is slightly

decreased and 2020 it decreases again. In 2021 total import decreases.

 Total export Position is decreasing in 2021 compare with previous year.

 Remittance amount is decreasing year by year.

 Foreign Exchange Business is increasing in 2018 compare with the previous year

2017. But in 2019-2020 it decreases compare with the year in 2018. In 2021 it

decrease compare with the previous years.

 The officers are very helpful to the business men. Some of our business men do

not know exactly the procedures of opening L/C.

 Lengthy process of opening L/C is observed at National Bank Ltd of OR

Chawkbazar branch.

 SWIFT is being used in some branches and the Head Office of the bank

with optimum security for trade finance related operation like documentary

credit, documentary collection, fund transfer, guarantee, etc. but not in all

branches.

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5.2 Recommendations

As per earnest observation some suggestions for the improvement of the situation are
given below:

 To attract more clients National Bank Ltd has to create a new marketing strategy,
which will increase the total export import business.
 Attractive incentive packages for the exporter will help to increase the export.
 National Bank Ltd should aware and take necessary steps about export, remittance
and over all foreign exchange business.
 Long term training very much required for the foreign exchange officers.
 Bank can provide foreign market reports, which will enable the exporter to
evaluate the demand for their products in foreign countries.
 New investment sector is booming rapidly. National Bank Ltd should identified
those untapped areas of business and invest in those sector such as Gas plant,
condensed milk project, ship breaking etc.
 Proper communication needs to establish with clients.
 Arrangement of monthly /quarterly training courses /workshops for the
selected by the authority in order to promote employee to their desired level
 It is noted that delay in service is one of the problems faced by the clients.
Attempts should be made to straighten the banking procedure.
 SWIFT service should be introduced in each and every branch of the bank, which
will help to smoothen the foreign exchange operation of the bank.
 Bank should provide emphasis to make the documentation and filing
process of foreign exchange operation user friendly.

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5.3 Conclusion
Proper financial system of a country can contribute towards the development of that
country’s economy. In our country, banks have a leading power to its financial system.
Among them National Bank Limited also makes significant contribution to the economy.
A strong banking sector is critical to economic growth and development in a developing
Country. A robust and well-functioning banking system facilitates the efficient allocation
of resources to individuals, organizations, and projects that can use those resources
effectively. The value of General Banking is immense. It‘s the core tool of banking as
well as the base of banking. Other sections depend mostly in this section. National Bank
Ltd. has an established and most importantly a reliable foreign exchange section. It
fulfills the consumer needs in almost every case with its dignity and honor. The company
itself is well-organized as well as its officers. National Bank Ltd is developing its
services to give a hard competition to other banks. Bank is a very important and vital for
economic development in mobilizing capital and other resources. National Bank Ltd is
also contributing to the advancement of the socioeconomic condition of the country. To
keep pace with the current market and demand, National Bank Ltd is following several
strategies and taking new initiatives, offering new products and services to the customers.
The bank should maintain well-structured communication from upper level to lower
level. National Bank Ltd has a strong position in the competitive market. As the economy
of Bangladesh is increasing so is the foreign trade and National Bank Ltd always have
played its role in making sure that things go smoothly. The bank is doing its best to
provide better Import, Export and Remittance services to the customers. Export, Import is
showing positive trends even after the global challenges that we are facing today.
However, the bank needs to improve its remittance and export as they were better before.

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References

 Annual Report 2017-2021, National Bank Ltd.

 Different types of brochures of National Bank Ltd.
 Articles of National Bank Ltd.
 www.google.com
 www.wikipedia.com
 https://www.nblbd.com/
 https://www.nblbd.com/#page
 https://www.nblbd.com/publications
 https://www.investopedia.com/

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