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General Banking Activities of Social Islami Bank Limited with special reference to Accounts
section
Chapter One
1.1 Introduction
Internship Program is very essential fGeneral Banking Activities of Social Islami Bank Limited
with special reference to Accounts section or every student; especially the internship program is
very helpful to conduit the space between the theoretical knowledge and real life experience as a
part of BBA program. This internship report has been designed to have a practical experience
through the theoretical understanding.
For every student, especially for the student of Business Administration, which helps him or her to
know the real life situation? For this reason a student takes the internship program at the last stage
of the bachelors degree, to launch a career with some practical experience.
This report is prepared for fulfilling a practical requirement of both BBA and the internship program.
On this regard been posted in Social Islami Bank Limited (SIBL), Begum Rokeya Sarani Branch
immediately after completion of BBA course for three (3) months duration internship program
(Policies & Practices of Investment Activities Of Social Islami Bank Limited) and have been advised
by the honorable management to submit my practical learning in written form at different phases.
Being stimulated by this constructive thought of management submitting paper for these phases
mainly focused on the General Banking Activities of SIBL, Begum Rokeya Sarani Branch.
1.2 Purpose of the Study
The purpose of the study is to analyze the general banking procedures, criteria, activities and overall
clients feedback and meet their demand in the context of Social Islami Bank Ltd. For fulfilling the
requirement for the degree of BBA.
1.3 Scope of the study
The scope of this internship work is limited to the overall description of the bank & its services. The
scope of this study may be stated as follows:
The study would help top management in planning and decision making.
The study would help top management in planning and decision making.
The study would help the management in identifying the key areas of strengths & weakness of
deposit accounts/schemes the study would help the management to take corrective and appropriate
measure timely to remove the problems from deposits account.
The study would also help the clients, borrowers & shareholders as a guide to companys present
and future situation.
1.4 Objective of the study
This study is aimed at providing me valuable practical knowledge about banking operation system
especially Islamic banking in Bangladesh. It will also help me to develop concept of banking and its
operation. The objectives are:
To know the banking system of Social Investment Bank Limited and to give an idea about how
SIBL emerged
To understand the various services the bank offers and to understand the mechanism of the
services
To understand, analyze and evaluate the modes the different Deposit Accounts/schemes of Bank
To analyze t& Investment of Social he Ratio of SIBL to evaluate the performance
1.5 Methodology of the study
The study is of exploratory nature. The finding of this study is based on analyzing both the primary
and secondary data. Moreover, this is a combination of both fieldwork and desk research.
1.5.1 Sources of Data/Information
A. Primary Data:
Notes that taken from the day to day-working activity.
Consulting with the officers of the Branch.
B. Secondary Data:
WWW.SIBLBD.COM
Annual Report of SIBL
Different Book
Personal interview was used to collect information. Before interview the questioner was tested and
modified. The collected data are then edited and transferred to a master sheet. For secondary data
web sites containing information regarding these banks and fliers were helpful.
1.5.2 Analysis of data/Information
Two approaches have been mainly used in this report
1. Conceptual Approach
2. Empirical Approach
1.6 Area of the study
This project is limited in overall banking system of the bank. All three functional areas of the bank
are takes to the scope of study.
1. General Banking
2. Foreign Exchange Area
3. Investment Area
1.7 Limitation of the study
There are many limitations that faced while preparing this report is mentioned here:
Only 12 weeks were not sufficient to collect and understand all the activities related to Banking.
In the research areas, the authorities could not express to us accurate data easily for the reason of
their confidentiality.
The executives of the bank could not give adequate time because of their work.
All the interpretation and conclusion about the result of study is based on the analyst own
perspective.
SIBL, Begum Rokeya Sarani Branch is a small branch and their concentration is very small area.
In Foreign Exchange Department they work as agent so we cannot gather proper information.
Chapter Two
Profile of the SIBL
2.1 Historical Background
Social Islami Bank Limited an interest-free Shariah bank in Bangladesh incorporated as a banking
company on 5 July 1995 under the COMPANIES ACT 1994. It commenced banking operations on
22 November 1995 with an authorized capital of Tk. 1,000 million divided into 1 million ordinary
shares of Tk. 1,00 each. The initial paid up capital was Tk. 118.36 million folly subscribed by its 38
sponsors including 3 Arab nationals. The paid up capital was enhanced several times and stood at
Tk. 260 million on . 31 December 2000. The bank is listed with the Dhaka Stock Exchange. In 2000,
total liabilities and shareholders equity of the bank stood at Tk. 5,671.99 million.
The bank provides all types of commercial banking services and it conducts business on the Islamic
principles of Musharaka, Murabaha, bai-muazzal and hire purchase transactions. The broad-
spectrum operational aspects of the bank have been set out to encompass three sectors formal,
non-formal and voluntary in a comprehensive programmed. In the formal corporate sector, the
bank offers banking services through deposit and investment accounts, trade financing, collection of
bills, money transfers, lease of equipment and consumers durable, hire purchase and installment
sale of capital goods, investment in low-cost housing and real estate management, and financing
projects in agriculture, transport, education and health sectors. In the non-formal non- corporate
sector, it is involved in opening and introducing various savings and investment schemes for the
unemployed poor and the educated. In the voluntary sector, it is involved in the development and
management of WAQF and mosque properties, management of inheritance properties, and joint
venture projects relating to religious affairs and charitable activities. Total deposits of the bank
amounted to Tk. 4,863.21 million in 2000 compared to Tk. 124.73 million in 1995 and included
currency and other deposits, bills payable, term deposits and savings deposits. On 31 December
2000, the loans and advances in various sectors stood at Tk. 3,522.24 million as against Tk. 0.22
million in 1995. On 31 December 2000, the classified investments (loans and investment) of the
bank amounted to Tk. 173.1 million (4.91% of the total). Foreign exchange business handled by the
bank in 2000 accounted for Tk. 4,250 million, which comprised export servicing, import financing and
remittance facilities. That year the assets of the bank were valued at Tk. 5,672 million and the off-
balance-sheet-items Tk. 1,060.04 million. The bank started having net profits since 1998 and the net
profit after adjusting all provisions for taxation and classified loans amounted to Tk. 38.1 million. The
profitability of the bank is severely affected by the fact that it has to maintain a substantial amount of
provision for its classified loans each year.
The management of the bank is vested in a 27-member board of directors headed by a chairman.
There is a 5-member Shariah Council of the bank to ensure the compliance of Islamic rules in its
activities. The bank has also a 13-member honorary foreign members international advisory council
to advice it on international business affairs, particularly in Islamic countries. In December 2000, the
bank had 13 branches and in aU, 310 employees including executives of different cadres.
IMPORTANT LINKS
National International
Bangladesh Bank Asian Clearing Union (ACU)
Bangladesh Export Promotion Zones Authority Asian Development Bank (ADB)
(BEPZA) Bank for International Settlements (BIS)
Bangladesh Government Official Forms International Labor Organization (ILO)
Board of Investment (BOI) International Monetary Fund (IMF)
Chittagong Stock Exchange (CSE) World Bank (WB)
Dhaka Chamber of Commerce and Industries World Trade Organization(WIO)
Dhaka Stock Exchange (DSE)

Economic Relations Division (ERD)

Export Promotion Bureau (EPB)

Federation of Bangladesh Chamber of

Commerce (FBCC)

Finance Ministry

Local Enterprise Investment Centre (LEIC)

National Board of Revenue (NBR)
Securities and Exchange Commission (SEC)
Securities and Exchange Commission (SEC)

2.2 Mission & Vision
Mission:
High quality financial services the latest technology.
Fast, Accurate and Satisfactory customer service.
Balanced & sustainable growth strategy.
Optimum return on shareholders equity.
Introducing innovative Islamic Banking products.
Attract and retain high quality human resources.
Empowering real poor families and create local income opportunities.
Providing support for social benefit organizations- by way of mobilizing funds and social service.
Vision:
Social Islami Bank Ltd started its journey with the concept of 21st Century Islamic participatory three
sector banking model: I) Formal Sector- Commercial Banking with latest technology; ii) Non-Formal
Sector Family Empowerment Micro-Credit & Microenterprise program and iii) Voluntary Sector
Social Capital mobilization through CASH W AQF and others. Finally, Reduction of Poverty Level
is our Vision, which is a prime object as stated in Memorandum of Association of the Bank with the
commitment Working Together for a Caring Society.
2.3 Operating Performance
Total Operating Income of the Bank as on 31st December 2009 stood at Tk. 1717.64 million against
Tk.1291.78 million of the preceding year. The Bank made an operating profit of Tk. 1064.30 million
in 2009 against Tk. 787.36 million of 2008.
Summery of operating result of the Bank as on 31
st
December 2009 vis--vis the position as on
31.12.2006 is shown below:
Particulars

31.12.2009 31.12.2008 Growth Rate
Income on Investment

3078.98 2732.26 12.69%
Profit paid to the Depositors

2063.62 2071.38 (0.37%)
Net Investment Income

1015.36 660.88 53.64%
Commission, Exchange & Other Income

702.28 630.83 11.33%
Total Operating Income

1717.64 1291.71 32.97%
Operating Expenses

653.34 504.34 29.54%
Profit Before Provision

1064.30 787.36 35.17%
Provision against Investment & Others

337.42 432.55 (21.99% )
Profit Before Tax

726.88 354.81 104.86%
2.4 SIBL Department

Information & Communication Technology Division

Shariah Board Secretariat
Financial Administration Division
International Division
Managing Directors Secretariat
Business Development & Marketing Division
Audit & Inspection Division
Chairmans Secretariat
Share Division
Board Secretariat
Human Resources Division
SIBL Training Institute
SME Banking Division
Law & Recovery Division
Board Audit Cell
MIS, Planning & Research Division
Internal Control & Compliance Division
Investment Risk Management Division
Voluntary Banking Division
2.5 Organogram of SIBL
2.6 Organization Structure for Branch
2.7 SIBL Branches:
City
Name
Sl.no Branches Name Address
01 Principal Branch 15, Dilkusha C/A, Dhaka 1000
02 Gulshan Branch Nafi Tower (1
st
Floor)53, Gulshan South C/A, Gulshan
Avenue, Gulshan-1, Dhaka
03 Babu Bazar Branch 31, Nawab Yousuf Road, Naya Bazar,Dhaka
04 Moulvi Bazar Branch 77/7, Wahid Center (1
st
Floor) , Moulvi Bazar, Dhaka
05 Begum Rokeya Sarani
Branch
Bangladesh Lions Foundation Bhabanh, 3/c,
West Agargaon, Begum Rokeya Sarani, Dhaka
06 Panthapath Branch Level 2, Block A, Bashundhara City 13/Ka/1, Panthapath
, Dhaka
07 Foreign Exchange
Branch
141-143, Motijiheel C/A, BIWTA Bhaban, Dhaka
Dhaka 08 Dhanmondi Branch House # 84, (Old-176), Road # 7/a (old-14),
Satmasjid Road, Dhanmondi R/A, Dhaka.
09 Nawabpur Road Branch 82, Nawabpur Road(1
st
Floor), Nawabpur Road, Dhaka.
10 Uttara Branch Latif Emporium, 27 Uttara C/A, Road # 7,Sector- 3, Uttara,
Dhaka.
11 Mirpur Branch Plot No-29-30, Block-Kha,Main Road (Goal Chakhar-10),
Mirpur, Dhaka.
12 Banani Branch 48 Kamal Attaturk Avenue (Ground & 1
st
Floor). Banani,
Dhaka-1213
13 Qaderia Tayebia 9/2A Madrasha Road, Joint Quarter, Block -F,

Madrasha Branch Mohammadpur, Dhaka-1207
14 Rosulpur Branch 49 Rosulpur, Kutubkhali Donia, Jatrabari, Dhaka

15 Rampura Branch Modina Tower (Opposite TV Center), Weat Rampura DIT
Road, Thana- Khilgoan, Dhaka.
Savar 16 Savar Branch Yousf Tower (2
nd
Floor), 35 Tatti, Dilkhusha Bagh, Savar
Bus Stand, Savar, Dhaka.
17 Hasnabad Branch Hasnabad Super Market, Suvadda, Keranigonj, Dhaka

Keranaiganj 18 Keranaiganj Branch East Aganogor Mosjid Market, Shuvadda, Thana-
Keranaiganj, Keranaiganj,
19 Sonargaon Branch Haji Jalal Tower(1
st
Floor), Mogra Para, Sonargaon,
Narayangonj.
Narayangonj 20 Fatullah Branch Fatullah Bazar, Narayangonj.

21 Gopaldi Branch Gopaldi Bazar, P.S: Araihazar,
Dist: Narayangonj.

22 Agrabad Branch Quaderi Chamber 37, Agrabad C/A, Chittagong.

23 Khatungoj Branch 96, Khatungoj, Chittagong.

24 Halishahar Branch VIP Plaza, Plot # 5/4, Road # 2, Block G, Halishahar
Housing Estate, Halishahar, Chittagong.
Chittagong 25 Jubilee Road Branch Haque Market(1
st
Floor)610/1, Jubilee Road, Chittagong.

26 Lohagara Branch Mostofa City, Lohagara, Chittagong.

27 Patherhat Branch Patherhat , Noapara, Raozan, Chittagong.

28 Nanupur Branch Nanupur Bazar, P.O: Nanupur, P.S: Fatikchari, Dist:
Chittagong.
29 GEC Mour Branch CDA Avenue, East Nasirabad, GEC Mour, Chittagong.

Rajshahi 30 Rajshahi Branch 219, Shaheb Bazar Main Road, Rajshahi.
Khulna 31 Khulna Branch 22, Sir Iqbal Road, G.M. Baksh Tower (Ground Floor),
Khulana City Corporation, Khulna.
32 Paik Gacha Branch Main Road ,Paik Gacha, Khulna.

33 Sylhet Branch 781, Karima Mansion, Dargah Gat, Sylhet-3100

Sylhet 34 South Surma Branch Baipass Road, P.O: Sylhat Sadar, P.S: South Surma ,
Sylhet.
Bogra 35 Bogra Branch Bhandary Monjil, 776, Rangpur Road, Borogola, Bogra.

36 Sirajong Branch Zaman Complex, S.S. Road, Sirajong.

Sirajong 37 Chandaikona Branch Pabna Bazar, Raigonj, Sirajong.

38 Elliotgonl Branch Elliotgonl Bazar, P.O: Elliotgonl, P.S: Dawudkhandi, Dist:
Comilla.
Comilla 39 Comilla Branch 95/96 ,Chawk Bazar(2
nd
Floor), P.O: Chawk Bazar, P.S:
Kotowali, Comilla.
Noakhali 40 Chowmuhoni Branch Hossain Market, 276-284, D.B. Road, Chowmuhoni
Powrosova, Begumgonj, Noakhali
Chandpur 41 Chandpur Branch Faisal Shopping Complex, Bishnudi, Chandpur Bus Stand,

Thana- Chandpur, Dist- Chandpur
Coxs Bazar 42 Coxs Bazar Branch Evan Plaza(in front of Coxs Bazar Pourashva), Thana
Road, Coxs Bazar
Chapter Three
General Banking
3.1 Introduction:
Currently Social Islami Bank Limited has 38 branches. IDB Bhaban Branch (E/8-A, Rokeya Sharani,
Sher-e- Bangla Nagar, Dhaka-1207) is one of them. It became operational on 23 Septemberl999.
The founder Chairman Prof. Dr. M.A Mannan, former secretary General of Rabeta Dr. Abudullah
Omar Nasseef was presented its opening ceremony. This bank has gotten more popularity in Sher-
e- Bangla Nagar. The customers this branch is increasing day to day. Because of narrow space this
branch shifted to Begum Rokeya Sharani Branch (3/C, Loins Bhaban, West Agargaon, Begum
Rokeya Sharani, Dhaka-1207) from IDB Bhaban branch. There are twenty staff in this branch. Mr.
Monzurul Haq Shoaib is Senior Assistant Vice Present and Manager and Mr. Meftah Uddin Ahmed
is first assistant vice president and second officer of this branch.
3.2 Branch Business Volume on 31.10.09
No Particular Taka
1 Deposit 887460029.41
2 Investment 244643349.75
3 Foreign Exchange 154601378.13
4 Income 88607050.95
5 Expenditure 76736410.31
6 Profit 11870640.64
7 Cash Position 5509867.51
3.3 Branch Performance on 31.10.09
exposit: Investment = 3.64: 1
income from service = 1350703.85 (in taka)
investment: Classification of loan = 94 : 1
3. 4 Product Mix (Deposit):
No Cost (Mudaraba Current account) = 64942716.06
Low Cost (Mudaraba Saving Account & Mudarabah Special Notice Account) = 209052564.68
High Cost (Fixed deposit) = 576238034.00
3.5 GENERAL BANKING
SIBL (Social Islami Bank Limited) General banking is divided into five sections.
1. Account Opening Section
2. Bills and Clearing Section
3. Cash Section
4. Remittance Section
5. Closing of an Account
3.6 Account Opening Section
Under this section, SIBL officer opens different types of account on the request of clients.
The procedure of opening account is given below.
Procedure and rules to open a new account
Mudaraba Saving Account (Code No: 134)
Before opening of a savings Bank Account the following formalities must the completed by the
coustomers:
1. Account opening Form: To be filled in and signed by each account holder.
2. Latest passport size photograph (2copy) for each account holder attested by the introducer.
3. Account payee cheque in favor of the account holder or cash deposit.
4. Copy of voter identity card/Ward Commissioner Certificate.
5. Introduction of account holder (Mandatory): To be signed by the introducer with ID an account
number.
6. 1 (one) copy of nominees photograph (attested by the account holder).
7. Copy of voter identity card (nominee).
8. Initial deposit TK. 500 (Five hundred taka only).
After fulfilling above formalities, open and account for the client and provide the customer with a
deposit book and a checkbook.
Al-Wadiah Current account (individual)
Code: 133
1. Account opening From: To be filled in and signed by each account holder.
2. Latest passport size photograph (2 copy) for each account holder attested by the introducer.
3. Attested copy of valid Trade license.
4. Attested copy of passport of the proprietor.
5. Company seal and TIN (Tax identification Number) Certificate.
6. Copy of voter identity card.
7. 1 (one) copy of nominees photograph (attested by the account holder).
The condition of Al-Wadiah Current account of Begum Rokeya Sharani baranch as following:
Mudarabah Special Notice Account
a. Any companey, business entity, debt of gov. Organization and trust or any person can open this
account.
b. This account is operated under Mudaraba principle.
c. Any amount can be withdrawn or transferred to all wadiah current account or any other accounts
after placing a notice of seven days.
d. Cheque books are provided for these accounts.
e. The profit rate is comparatively lower.
A. In case of partnership Account:
1. Introducer (Current Account holder).
2. 2 copy passport size photograph dully attested by introducer.
3. Copy of voter identity card all partners.
4. Attested copy of valid Trade License.
5. Seal of Firm.
6. Copy of the TIN (Tax identification Number) Certificate.
7. Partnership deed.
8. Fill the KYC form.
B. In case of Private/ public limited Company Account:
1. Memorandum and Articles of Association- duly certified by the Register of Join Stock Companies
and Firms.
2. Certification of Incorporation- duly certified by the Register of Join Stock Companies and Firms.
3. Board Resolution- duly certified by the Chairman/ Secretary of the Company.
4. List of Member of the Managing Committee/Executive Committee-duly certified by the Chairman/
Secretary.
C. In case of Club/Society:
1. Certified copy of Registration Certificate.
2. Certified copy of Charter/Bye-Laws and Regulation/Constitution of the relevant organization.
3. Copy Resolution of Registration of Managing Committee/Executive Committee for opening
Account with SIBL and operation of account- duly certified by the Chairman/Secretary.
4. List of Member of the Managing Committee/Executive Committee-duly certified by the Chairman/
Secretary.
D. In case of Non-Government School/College/University/Madrasha/Muktab:
1. Certified copy of Registration Certificate.
2. Copy Resolution of Registration of Managing Committee/Governing Body authorizing opening and
operation of account with SIBL- duly certified by President /Secretary of the management committee.
3. List of Member of the Managing Committee/ Governing Body- duly certified by a Gazette Officer.
E. In case of Sector Corporations:
Certified copy of the relevant Order/Act of Parliament establishing the Corporation.
Regulation of Board Of Directors/Competent Authority to open Account with SIBL.
Certified list of the Board of Directors (if any).
F. In case of Local Authorities, City Corporation etc:
1. Certified copy of the Statute/ any other Law by which the body is created and governed.
2. Resolution of Municipal Committee/Managing Body (if any) to open Account with SIBL- duly
certified by Chairman/Mayor/Competent Authority.
3. List of Member of such Committee/Body-duly Chairman/Mayor/Competent Authority.
3.6.1 Deposit Account by SIBL
Mudaraba Saving Deposits (MSD)
These are profit bearing deposit account. The drawing are restricted in the respect of both the
amount of withdrawal and the frequency three of so the payment of interest does not become any
compensating for the banker. Some time the restriction are ignored against the depositors written
confirmation to forgo his claim for interest on the total balance for the whole month of withdrawal.
Special Saving Scheme
1. Mudaraba Hajj Saving Scheme
A person intended to perform Hajj within 1 to 10 years can open this account for a period at his
convenience.
A year is divided into 12 installments.
Profit is given for the daily balance based on a weight of 1.1%
There is no provision for withdrawal.
2. Mudaraba Education Scheme
SIBL being encouraged by the success of the Mudaraba deposit account has introducer another
saving Scheme namely Mudaraba Education Scheme
Initial Deposit Maturity Period Total Period Monthly Education Allowance
25,000 7 Year 55,000 1,000
25,000 10 Year 77,000 1,500
25,000 15 Year 1,36000 2,500
25,000 20 Year 2,40000 4,500
3. Mudaraba Millionaire Scheme
People of Bangladesh are the Following of Islam. They are mostly interested to make interest free
deposit. Taking these Facts into consideration SIBL a join venture Islami bank introduced a monthly
installment based Mudaraba Millionaire Scheme.
Duration of this Scheme will be 15, 20 and 25 years. After maturity an estimated amount will become
as follows:
Duration Monthly Installment Estimated amount after maturity
15 Tk. 2,050 Tk. 10 lac
20 Tk. 1.050 Tk. 10 lac
25 Tk. 550 Tk. 10 lac
4. Mudaraba Special Saving (pension) Scheme
Any Bangladeshi person aged abode 18 years and having sound mental condition can may open
this scheme. To open this account there must be a signature of a valued introducer. Parents or legal
guardians can open this scheme in the name of their underage children.
After maturity estimated profit will be applied as follows:
Monthly Installment Estimated amount after maturity
5 Years 10 Years
500 40,000 (Provisional) 1,12,250(provisional
1000 80,000(Provisional) 2,25,000(provisional)
5. Mudaraba Monthly Profit Deposit Scheme
The features of this scheme are as follows:
1. Tk, 1,00,000, 1,10,000 1,20,000 or 1.25.000 or any amount multiple can be deposited under this
scheme.
2. The duration of the amount should be for Five years.
3. Profits shall be distributed under this scheme as follows:
1,00,000 Tk. 900 (Provisional)
1,10,000 Tk. 1000 (Provisional)
1,20,000 Tk. 1100 (Provisional)
1,25,000 Tk. 1150 (Provisional)
4. The Payable profit will become due after 1 month of deposit. But the amount will be deposited to
account in the last week of the month.
3.7 Bills and Clearing Section
SIBL Local Office branch performs the bill clearing function through Local office. SIBL Local office
acts as the agent of all SIBL branches for the clearing house of the Bangladesh Bank. There are two
type of cheque which are-
1. Inward clearing cheque
2. Outward clearing cheque
A. Inward Cheque
Inward cheque are those ones drawn the respective branch which have been presented on other
banks and will be cleared/honored through the clearing house of Bangladesh Bank.
Account Treatment
Dr. Cr.
SL NO. Particular Amount SL NO. Particular Amount
01 Customers A/C *** 01 SIBL A/C ***
B. Outward Cheque
Outward cheque are those ones drawn on other bank branches which are presented on the
concerned branch for collection through cleaning house of Bangladesh Bank. These cheque are
called outward cheques.
3.8 Cash Section
The cash Section of anybranch plays very significant role in general banking department. Because, it
deals with most liquid assets the SIBL Local Office Branch has an equipped cash section. This
section receives cash from depositors and pay cash against cheque, draft, PO and pay in slip over
the counter.
1. Receiving Cash:
Any people who want to deposit money will fill up the deposit slip and give the form along with the
money to the cash officer over the counter. The cash officer counts the cash and compares with the
figure writer in the deposit slip. Then he put his signature on the slip along with the cash received
seal and records in the cash receive register book against A/c number.
At the end of procedure, the cash officer passes the deposit slip to the counter section for posting
purpose and delivers the duplicate slip to the clients.
Account Treatment
Dr. Cr.
SL NO. Particular Amount SL NO. Particular Amount
01 Cash A/C *** 01 Customers A/C ***
2. Disbursing Cash
The drawn who wants to receive money against cheque to the payment counter and presents his
cheque to the officer. He verifies the following information:-
I. Date of the cheque
II. Signature of the A/C hold
III. Material alteration
IV. Whether the cheque is crossed or not
V. Whether the cheque is endorsed or not
VI. Whether the amount in figure and in word correspondent or not
3.9 Remittance of Funds
Remittance of funds is ancillary services of SIBL. Its aids to remit fund form one place to another
place on behalf of its customer as well as non-customers of bank. SIBL has its branches in the major
cities of the country and therefore, its serves as one of the best mediums for remittance of funds
form one place to another.
The main instruments used by SIBL, Local Office Branch for remittance of funds.
I. Pay Order/ Bankers cheque.
II. Demand Draft.
III. Telegraphic Transfer.
Pay Order/ Bankers cheque
The pay order is an instrument issued by bank, instructing itself a certain amount of money
mentioned in the instrument taking amount of money and commission when it is presented in bank.
Only the branch of the bank that has issued it will make the payment of pay order. The bankers
cheque must come the branch for payment wherever it is presented.
Issuing of Pay Order:
The procedures for issuing a pay order are as follows:
Deposit money by the customer along with application form.
Give necessary entry in the bills payable (Pay Orders) register where payees name, date, Po no,
etc is mentioned.
Prepared the instrument.
After scrutinizing and approval of the instrument by the authority, it is delivered to customer.
Signature of customer is taken on the counterpart.
Cancellation of a pay Order
If a buyer wants to cancel it, should submit a letter of instrument in this regard and also return the
instrument.
Bank Draft:
The person intending to remit the money through a pay order has to deposit the money to be
remitted with the commission which the banker charges for its services. The amount of commission
depends on the amount to be remitted. On issue of the pay order, the remitter does not remain a
party to the instrument 1) Drawer branch 2) Payee.
Stop Payment can be done in the following cases:
a) Loss of draft before endorsement in this case. draft reported to be lost payees endorsement
requires verification is marked.
b) Loss of draft after endorsement: In the this case, the branch first satisfies itself about the claimant
and the endorsement in his favor.
Mail or Telex Transfer (TT)
Telex Transfer is another widely used mode for remittances of funds.
Issuing of TT:
1. SIBL follows the following procedures:
2. The customer deposit money with SIBL to be sent.
3. The customer obtain a cash memo containing TT serial Number.
4. TT serial number, notifying part name is
5. The telex Department confirms transmission of the telex.
3.10 Closing Of an Account
For two reasons, one can be closed. One is by banker and other is by the customer.
1. By banker : If any customer doesnt maintain any transaction within six years
and the A/C balance becomes lower then the minimum balance, banker has the right
to close an A/C.
2. By customer: If any customer wants to close his A/C, he write an application to
to the manager using him to close his A/C.
Different procedures are followed in cash of different types of A/C to close. Fixed deposit A/c is
closed after the termination of the period.
Closing process for current & saving A/C:
After receiving customers application the officer verifies the balance of the A/C.
He then calculates interest and other charges accumulated on the A/C.
If it bears a credit balance, the officer writes advice voucher. He gives necessary accounting entries
post to accounts section.
He balance is returned to the customer. And lastly the A/c is closed.
But in practice, normally the customer dont close A/C willingly. At times, customer dont
Maintain any transaction for long time. Is this situation at first, the A/C becomes dormant and
Ultimately it is closed by the bank.
Chapter Four
Other Activities of SIBL
Investment
4.1 Different Investment Scheme :
The bank extends Investments under the principals of
1. Mudaraba
2. Musharaka
3. Bai- Murabaha (Contract Sale)
4. Hire Purchase under Shirkatul Meelk (HPSM)
5. Bai-Muajjal (Sales under deferred payment)
6. Bai- Salam (Advanced Purchase)
7. Bai- Istisna
1) Mudaraba (The Hiring of Capital):
Mudaraba is one of the most well known investments. permissible under Islamic Shariah and widely
used by all countries where Islamic systems of banking are functioning. Mudaraba finance combines
financial experience with business experience. Mudaraba is a contract in profit sharing where one
party provides capital funds and the other labor/ work. Under this system, banks provide the capital
and clients provide expertise and profit is shared according to agreed ratio. In case of loss, the bank
bears the financial risk and the client loses only his labor! effort and his expected share of profit.
Important Features :
Mudaraba is generally limited to self-liquidating transactions.
The assets of Mudaraba should be easily recognizable and must be realized and liquidate so that
the proceeds can be easily distributed between the partners at the termination of operations,
completion of deal, or the achievement of Mudaraba objectives.
I f the partners want to renew the Mudaraba, a new contract must be negotiated, but only after the
old one has been terminated and the rights and liabilities of the parties concerned have been
recognized and settled.
Mudaraba is generally limited to trading activities.
The entrepreneur has no right to mix the Mudaraba funds with his own funds, unless he was
permitted to do so by the bank.
Before liquidation of distribution of profits, the Mudareb possesses an uncontested right not only to
his share in profits but also to any gains or appreciation in the value of output or assets of the joint
venture that might occur during the life of the Mudaraba contract.
The Mudaraba accounts must be recorded properly and the books of accounts should be audited.
2) Musharaka (Partnership Profit Sharing):
Musharaka is another type of financing mechanism used by Islamic Banks. This mode of finance is
represented by two or more financiers in contributions of equal or unequal ratios of capital to
establish a new project or to participate in an established one and all partners are entitled to share
the total profits of the venture according to ratio as mutually agreed upon allowing for managerial
skills to be remunerated; but the losses are shared exactly in proportion to capital proportion.
Participation parties have the right to participate in the management of the project and at the same
they may also waive this right in favor of any specific partner.
There are two types of Musharaka contracts:
Constant (permanent)
Decreasing (diminishing) Participation.
In the first case, the bank participates in the equity and receives share of profit on pro-rata basis
annually and period of termination of the contract is not mentioned/ specified. So, the contract may
continue as long as the parties concerned agree it to continue.
The diminishing partnership of Musharaka IS getting more popular In Islamic Banks because of its
potentialities than permanent Muskaraka. In constant! permanent Musharaka funds are committed
for a long period; but this is not so in the case of diminishing Musharaka. Decreasing Musharaka
allows equity participation in the first place and share profit on pro-rata basis. This system also
provides/ extends for future payments of money over and above the banks share in the profit as a
repayment of the part of equity held by the bank. In this manner, the equity held by the bank is
reduced progressively with the passage of time. After lapse of certain period of time, the bank will
have zero equity and will cease to be a partner.
Important Features:
The bank is not guaranteed a fixed return on its participation.
Banks benefits in financing fixed assets or working capital or both lie in the profit sharing scheme
between the banks and venture.
Profits are shared pro-rata with equity and are calculated for this purpose,
after allowing for management fees and before depreciation and provisions, as non-cash- items.
3) Murabaha (Contract Sale):
Murabaha is one of the most widely used modes of finance undertaken by the Islamic Banks. About
70 to 80 percent of financial operations of the most Islamic Bank belong to this segment. It is
suitable for investment for financing industry,. agriculture, trade or any other sectors. It enables the
client! investor to obtain finished goods, raw materials, machinery or equipment from the local
market or through import by opening letter of credit under Murabaha commercial.
Murabaha is one kid of sale transaction. Under this system of investment, a sale transaction is taken
place between client and bank. The client requests the bank to purchase certain goods as
prescribed by him/them with a price confirmed by. the client from a supplier seller in the country or
abroad. The bank, itself or through an agent (may be the client himself) collects all the information
about the nature and specification of the goods, its price, terms of delivery etc.
Murabaha is also a double sale and bye. Under this technique, bank buys the goods upon the
request of the client and then sells the goods to him/ them. The goods are purchased by the
customer from the bank within a fixed period of time or by installment with a cost include cost of
goods plus mark up profit. The profit mark up as fixed before the deal cannot be increased even if
the client does not take the delivery within the scheduled time.
When Murabaha sale is made of deferred payment basis, this is called Murabaha -BaiMuajjal. Under
this sale. Bank sells the commodity to the client on the basis of deferred payment against an agreed
price, which includes the price and mark up profit. Murabaha sale is also one kind of absolute sale,
which is divided into four kinds in respect of price. These are given below:
01. Bargain Sale: Selling of commodity at a price already agreed upon irrespective of its
purchased price
02. Tawlia Sale (respective Sale): Selling the commodity at purchased price without any additional
or discount.
03. Discount Sale: Selling the commodity at a purchased price allowing certain discount.
04. Murabaha Sale: Selling a commodity at a purchased price plus certain profit as agreed upon.
This profit margin may be determined on a percentage of the purchased price or a lump sum as
agrees to. The last three sales are called: Amana (honesty) Sales
4) Hire Purchase under Shirkatul Meelk:
Hire purchase under Shirkatul Meelk is a special type of contract that has been developed through
practice. Actually, it is a composition of three contracts:
1) Shirkat: Shirkat means partnership. Shirkatul Meelk means share in ownership.
When two or more persons supply equity, purchase an asset, own the same jointly, and share the
benefit as per agreement and bear the loss in proportion to their respective equity, the contract is
called Shirkatul Meelk contract.
2) Ijarah (Leasing): The Ijarah financing under Islamic Shariah is akin to the western concept of
leasing. In Ijarah financing, Islamic banks finance capital goods to industrial project against payment
of a rent by installment.
In Arabic the Leasing is defined as contract between a leasing company (called as the less or) of
one part and the user of the equipment asset (called the lessee) of other party whereby the lessee/
loaned agrees to pay the less or an agreed amount of money as rentals over a specified/ obligatory
period of time in consideration for the use of capital equipment owned by the less or. The less or
retains ownership of the equipment and seeks to receive the capital cost of the equipment plus a
profit margin out of the lease rentals payable during the period of the lease.
There are two types of leases recognized under this system of investment. These are-
a. Operational Lease: Under this system of finance, Islamic Banks hold a number of various assets
to respond to the needs of different customers. These assets have usually high degree of
marketability. The bank rents these assets to its client who is desirous to utilize the same for a team
to be agreed upon on payment of rental. After expiry of the lease period, the assets are returned to
the bank. The bank then looks for new lessee.
b. Lease Purchase: The lease purchase or lease out that ends with possession is a new technique
of investment innovated By the Islamic Banks. Under this system, bank does not hold the assets; but
purchases the assets in response to an emphatic request from one of the customers to own the
assets through lease that ends with possession. Therefore, the assets will not remain as the
property of the bank at the end of the lease period as is the case in the operation lease. As soon as
the purchase amount of household goods along with rental is paid off with in the lease period, the
ownership of the leasehold item transfers to the lessee automatically as
per contract.
3) Sale: This is a sale contract between the buyer and a seller under which seller transfers the
ownership of certain goods or assets to buyer against agreed upon price paid/ to be paid by the
buyer.
Thus, in Hire Purchase under shirkatul Meelk both the bank and the client supply equity in equal or
unequal proportion for purpose of an asset like land, building, machinery, transport etc, purchase the
asset with that equity money, own the same jointly, share the benefit as per agreement and bear the
loss in proportion to their respective equity. The share, part or proportion of asset owned by the
bank, is hired out to the client partner for a fixed rent per unit of time for a fixed period. Lastly, the
bank sells and transfer the ownership of its share/ part! portion to the client against payment of price
fixed for that part either gradually part by part or in lump sum within the hire period or after the expiry
of the hire agreement.
Hire Purchase under shirkatul Meelk Agreement has got three stages:
Purchase under joint ownership
Hire
Sale and /or Transfer of ownership to the other partner Hirer.
5) Bai- Muajjal:
Bai- Muajjal means sale for which payment is made at a future fixed date or within a fixed period.
Bai-Muajjal may be defined as contract between a buyer and a seller under which the seller sells
certain specific goods to the buyer at an agreed fixed price payable at a certain fixed future date in
lump sum or within a fixed period by fixed installments.
In bank, Bai- Muajjal is treated as a contract between the bank and the client under which the bank
sells to the client certain specific goods, purchased as per order and specification of the client at an
agreed price payable within a fixed future date lump sum or by installment.
6) Bai-Salam (Advance Sale and Purchase):
Bai-Salam may be defined as a contract between a Buyer and a Seller under which the seller sells in
advance the certain commodities/ products permissible under Islamic Shariah to the Buyer at an
agreed price payable on execution of the said contract and the commodities/products are delivered
as per specification, size, quality, quantity at a future time in a particular place. Under this
transaction the cost of commodity is advanced in cash to the seller who agrees to believer the
commodity on a definite due date. The delivery of the commodity sold is deferred but the payment of
the price is immediate.
Important Features
Bai-Salam is a mode of investment allows by Islamic Shariah in which commodities/ products can
be sold without having the said commodities/ products either in existence or physical! constructive
possession of the seller.
Generally, industrial and agricultural products are purchased/ sold in advance under Bai-Salam
mode of investment to infuse finance so that production is not hindered due to shortage of fund/
cash.
Bai-Salam investment may also be allowed in export-oriented industries. This can be allowed after
opening of the Lie, arrival of raw materials, shipment of raw materials etc. the bank may sell export
its goods through the seller/ exporter under a separate agreement or this may be done duly
incorporating in the Bai-Salam agreement unless otherwise settled and prescribed.
It is permissible to obtain collateral security from the seller client to secured the investment from
any hazards viz., non-supply/ partial supply of commodities/ products, supply of low quality
commodities/ products etc.
It is permissible to obtain mortgage and / or personal guarantee from a third party as security
before signing of the agreement or at the time of signing the agreement.
The seller client may be made agent of the bank to sell the goods delivered to the bank by him
provided a separate agency agreement is executed between the bank and the client.
7) Bai Istisna:
The majority of the juries consider as one of the division of Bai- Salam. Therefore, it should be
treated under the definition of Bai- Salam. But the Hanafi School Fiqh declares Istisna an
independent and separate contract. The jurists of the Hanafi School have given various definitions to
Istisna, some. of which are:
It is a contract with a manufacturer to make something and it is a contract on a commodity on
liability with the stipulation of work i.
Under this contract the first party agrees to contract manufacturer a particular products and
deliver it to second party against a predetermined price. The price may not be required to pay
in advance. It may be paid in installments, or can even be deferred until the desired product is
delivered.
Foreign Exchange
4.2. Foreign Exchange
Export Finance:
Foreign Exchange Trade of SIBL is dealt with its 09 AD branches out of which 4 branches are in
Dhaka and the remaining 05 are in Chittagong, Khulna, Sylhet, Rajshahi and Bogra. We as a 21st
Century Bank, providing our services in foreign trade through import and export finance and also
playing significant role in the area of foreign remittance. To facilitate the import obligation of our
Bank as well as considering the requirement of foreign currency of our country we encourage
potential exporters to do their export business with us. We provide working capital on their
requirement. Presently our export finance is extended for RMG and for non-traditional item that is
handled by a number of experienced bankers. We offer competitive exchange rate for foreign
currency to our valued exporters. In the last 03 years our export business performance is significant.
To enable the exporter to make shipment of goods to the foreign buyers, they need finance in the
following stages:
Pre-shipment Finance: when an exporter seeks financial assistant before loading the goods on
shipment for export, it is called Per-shipment finance. Such credit is granted to the exporter for
procurement and processing of raw materials, manufacture of finished products, packing and
transporting goods meant for export.
Post-shipment Finance: The advance made against the shipping documents till the export
proceeds are realized falls under the category of post shipment finance. The need for post shipment
finance arises because exporters who sell goods abroad have to wait for a long time before payment
is received from overseas buyers.
Import Finance:
They also deal in import business and our import business is extended to commercial importers
(traders) for import of various shariah approved items and industrial importers (Users) for import of
raw cotton, yam, clinker, pharmaceutical raw materials, TV parts, Computer parts etc raw materials
for their industries.
We also provide post import finance such as MPI (LIM), LTR an HPSM
(Lease financing). Our post import finance is also provided for importing of capital machinery. While
opening letter of credit at the request of buyer, bank normally examines:
Buyers creditworthiness
Import Trade Regulations
Exchanges Control Regulations
Suppliers Creditworthiness report
Marketability of goods
Foreign Remittance:
We are playing important role In the Foreign Remittance sector also. We have correspondent
relationship with almost all major 122 Banks of 109 countries of the world like Standard Chartered
Bank, American Express Bank Limited, HSBC, HBZ Finance, Mashreq Bank PSC, Dresdner Bank
AG and with local banks in Pakistan, India, Nepal and Bhutan etc with whom we have advising,
reimbursing and add confirming
SWIFT:
SIBL is the member of SWIFT and we have 09 SWIFT workstations in all of our 09 AD branches.
Besides our 24 branches are equipped with online banking. We are trying to keep all the SWIFT
workstations under online system. Inward remittances are credited to the beneficiary s account on
the same day of receipt if the beneficiary maintains AIC with them or within next 24 hours on receipt
of the same from our overseas correspondents. All correspondences of foreign trade both export
and import are communicated through SWIFT. As a result foreign exchange trade become
expeditious and instant.
Chapter Five
FINDINGS
RECOMMENDATION & CONCLUSION
5.1 Findings
Social Islami Bank is entirely a new banking system special BRS, which was adopted for a better
change in social economics condition and to make the banking function dynamic.
By the construction of capital production employment opportunities Investment and strong
economical structure this branch performing major role to meet up the demand of sociality.
BRS is operated according to Islamic Shariah Where transaction are excited without interest. In the
modem word BRS is developing banking activities for the welfare of the people a cording to the
Islamic Shariah.
I. All activities are conducted on interest free system according to Islamic Shariah.
II. Investment is made through different modes as per Islamic Shariah.
III. Invest income of the bank is shared with the Mudaraba depositions according to an agreed upon
ratio, ensuring a reasonable fore rate of return on their deposits.
IV. Aims to introduce the welfare oriented banking system and also establish equity and justice in the
field of all economic operations.
V. Lack of strong initially of explore Investment opportunities through research and markets.
VI. Some of the employers try to violet Islamic Shariah when try deal with investment.
VII. Some of the employers and employees are not business graduate/master.
VIII. Some Investment deal is very much slow.
IX. BRS lacks efficient men power.
5.2 Recommendation
People have no way but to come to the Banks for higher financing, so the operations and
way of getting loans need to be very sharpened. If the private banks provide a huge banking facilities
and offers in less expensive condition for lower class people, they can be more advanced and
independent which with help our country to go for more progress. The ways can be recommended
as:
They should follow accurate Shariah based investment policy. In our country it is quite difficult, but
they should overcome it.
Smoothing service and reducing time consumption.
Improve customer service and consequently satisfactory operational result.
SIBL should improve the branch facilities.
They should invest at minimum possible risk because of the current economic condition of the
whole world.
They should maintain Bangladesh Bank circular & ensure compliance.
Before investment they should analysis these: Market analysis, Technical analysis, Financial
analysis, Management analysis, and Economic analysis.
According to current Economic condition they should invest more safely, otherwise they should not
overcome this problem .
SIBL should invest in agricultural sector because it is more profitable project than others .
SIBL now act as market follower but they should be market leader like other bank.
SIBL should enlarge their operation over the whole country.
They can build a strong security system against any terrorism activities that will give safety to
peoples life and wealth in the present crime prone world. Because bombing as terrorism is
spreading all over the country and has made a big phobia among the people.
5.3 Conclusion
In short, Social Islami Bank Ltd. is such a Commercial Bank which is rendering all commercial
banking services to the customers in addition to make available Micro-Credit & SME finance to the
millions of needy people of the country. As part of a Corporate Social Responsibility, it is playing a
remarkable role to help the distressed people of the society in different welfare related activities.
They focus on dignified, prompt and personalized services being rendered to their customers. They
believe in developing strong interpersonal relationship with each other. As such, they are morally
bound to provide high quality banking services with the latest technology to obtain optimum return on
shareholders equity ensuring safety of depositors money and making all out efforts to introduce
their innovative Islamic Banking products to their existing and prospective customers. They are really
happy that they have given enough emphasis to empower poor families to create income opportunity
by providing financial support to make them self-reliant. They consider their services no less
important towards improvement of the fate of deserving people in the society.
Chapter six
Appendix & Bibliography
6.1 Appendix
Social Islamic Bank Limited
Begum Rokeya Sarani Branch
1. Subject: Proposal for ( the proposal)
2. Applicants Name:
Industry Name:
Industry Code:
Group Name, if applicable:
3. Address: Office: Factory:
4. Particulars of Proprietor/ partner/ Director:
Name with father/ husband
and mothers name
Status Present
Address
Permanent
Address
Number of Share/% of
shareholding
Net
worth
5. Particulars of the guarantor, if any
6. Particulars of proposal facility:
Facility Limit Tenure Margin Commission
LC
MPI
TR
MURA
BIAM
HPSM
BG
Bid Bond
PG
APG

7. Purpose of investment
8. Nature of Business
9. Constitution of the firm
10. Date of Establishment
11. Capital Structure
Authorized Capital
Paid up Capital
Retained Earnings
Investment in the Business (in case of proprietorship/ partnership)
Net worth
12. CIB Report:
13. CRG Status:
14. Period of Investment:
15. Rate of Profit:
16. Margin:
17. Commission:
18. Date of Expiry ( incase of renewal/ recasting proposal):
19. Mode of Disbursement:
20. Mode of Repayment:
21. Security Arrangement:
22. Sources of Repayment:
Primary:
Secondary:
Trials:
23. Investment Policy Compliance
Investment Guideline Complied Not Complied
Investment Policy Complied Not Complied
24. Brief Description of the Management:
Key Management:
Size of Staffs:
Size of Labor forces:
Turnover of Staffs for last three years:
25. Name of Major Supplier:
26. Name of the Major Customer:
27. Particulars of sister concern, if any:
Name Nature of Business Year of Establishment Annual Turnover
28. Account Turnover (current Account):
Account Type & No Opening Date Credit Sum Debit Sub Balance
29. Preformance of Foreign Trade With SIBL:
30. Business Performance with SIBL (last three years):
31. Liability with other banks
32. Cost Financing Aspect
33. Business Risk
34. CRG
Enclosure:
Copy of Investment Application From
Copy of Tread License
Photograph of the owner
Letter of consent along with Photograph
Visit Report
Valuation Certificate
Legal Opinion
Certificate copy of Memorandum and Article of association
Copy of CRG
Copy of audit Balance sheet
Lawyer certificate
Current account statement
Investment Account Statement
Copy of related Quotations
Copy of cash flow statement
Other document
6.2 Bibliography
Guideline to fill in the Banking Statistics
Author: Statistics Department Bangladesh Bank
WWW.SIBLBD.COM
A Text Book On Bankers Advances
Author: L.R. Chowdhury
Web site -googols, Yahoo!
Basic business communication (Lesikar I Flately)
News paper ./ Amar Desh.
Exclusive Economics Weekly (Banking)
Contemporary Business communication.(Lois E. BOONE, David L.Kurtz)
Banglapedia encyclopedia

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