Report

Letter of Transmittal
27 July, 2016.
To
Mr. Md. Rezaul karim
Assistant Professor,
Department of Business Administration
Sylhet International University,
Shamimabad, Bagbari, Sylhet.
Subject: Submission of Report on The loan
disbursement and recovery system of
Bangladesh Krishi Bank, a Study on BKB, Sylhet
Corporate Branch.
Dear Sir,
This is my pleasure to submit the report on The
loan disbursement and recovery system of
Bangladesh Krishi Bank: A Study on BKB, Sylhet
Corporate Branch that I have been assigned as an
important requirement of MBA program at Sylhet
International University.
I would like to thank you for your supportive
suggestions and helping me to carry on this study.
I have tried my level best to follow the guidelines

given by you. I am very much glad that you have
given me the opportunity to prepare this report for
you and hope that this report will meet standards of
your judgment.
---------------------
A. F. M Shahidul Islam
Roll: 16209
Department of business administration
Sylhet International University.
1 Loan disbursement and recovery system | Bangladesh Krishi Bank

Acknowledgement
All the praises are for the almighty, Allah Who bestowed me with the ability and potential
to complete this report. I also pay my gratitude to the almighty for enabling me to
complete this report within due course of time. Words are very few to express enormous
humble obligations to my affectionate parents for their prayers.
It has great honour and privilege to complete this report at Bangladesh Krishi Bank,
Sylhet corporate Branch.
I would like to take opportunity to express my humble gratitude to my honorable teacher

and academic supervisor Mr. Md. Rezaul karim for guiding me and for providing
all facilities and support to meet my reports requirements. His constant guidance and
willingness to share his vast knowledge made me understand this report and its
manifestations in great depths and helped me to complete the assign tasks.
I also appreciate the cordial co-operation from all my concern colleagues in that
branch with different responsibilities, especially DGM & AGM Sir concern officers for
providing me requisite information and knowledge for compilation of my complete
the report.
Although there may be many who remain unacknowledged in this humble note of
gratitude there are none who remain unappreciated.

Letter of Transmittal
07 July, 2016.
To
Mr. Md. Rezaul karim
Assistant Professor,
Department of Business Administration
Sylhet International University,
Shamimabad, Bagbari, Sylhet.
Subject: Submission of Report on The loan disbursement and recovery

system of Bangladesh Krishi Bank, a Study on BKB, Sylhet
Corporate Branch.
Dear Sir,
With due respect I, A. F. M Shahidul Islam Roll no.16209, would like to inform you
that, it is a great pleasure for me to submit the report on the Loan Disbursement and
Recovery System of Bangladesh Krishi Bank: A study on sylhet corporate branch, as a
requirement for MBA program .While conducting the report, I have gather lots of knowledge
about banking and many unknown facts, Loan Disbursement and Recovery System and
other activities of Bangladesh Krishi Bank in Bangladesh.
Therefore, I finally believe that, this report will be able to meet your approval. I would genuinely
appreciate to make further correction where it seems necessary by you. Your kind advice will
encourage me to conduct more work in future.
Sincerely Yours,
Roll: 16209
Letter of Acceptance
This is to certify that A. F. M Shahidul Islam is a student of MBA program under

Department of Business Administration, Sylhet International University. He has
successfully completed this report on `` The Loan Disbursement and Recovery System
of Bangladesh Krishi Bank : A study on BKB Corporate Branch Sylhet in Bangladesh
Krishi Bank at Sylhet, Corporate Branch.
This report has been prepared and submitted which is seemed original to me.
I wish him every success in life.
Roll: 16209

EXECUTIVE SUMMARY
This Report covers the details of Bangladesh Krishi Banks practices about analysis of
loan disbursement & recovery system. The report consists of the writers observation
and on the job experiences during the internship period in the loan department of BKB
corporate branch, sylhet, Bangladesh, The report mainly emphasizes the sequential
activities involved in loan approval process, analytical techniques used by BKB for loan
analysis as an integral part of the loan approval process. The report also focuses on the
loan recovery by BKB both in pre-sanction and post-sanction period of a loan. Finally
the report incorporates an evaluation of the different aspects of the lending process and
risk management techniques and makes some recommendations.
Loan is the primary financial activities in the banking system. The report provides a
detailed discussion about how Bangladesh Krishi Bank manages its loan activities. In
doing so, the standard operating procedures of the bank have been delineated in
details. The report also discusses banks procedures for managing its non-performing
loans. Loan classification procedures have also been discussed in the report. The bank
is recognized as one of pioneers in maintaining compliance with the Bangladesh bank
directives. The report provides a detailed discussion of some the crucial issues of loan
risk management and tries to focus on the practice of Bangladesh Krishi Bank in this
regard under the regulatory framework prevailing in the country. The findings and their
implementations are delineated adequately for the reader to enable them to get the gist
of the core idea behind the study.
In this report also analysis the loan disbursement and recovery rate of BKB corporate
branch sylhet last five years.
TABLE OF CONTENTS
Chapter Particulars Page no.

Chapter -1 1. 1 Introduction
1.2 Origin of the report
1.3 Significance of the Report
1.4 Scope of the report
1.5 Objective of the report
1.6 Methodology of the report
1.7 Rational of the report
1.8 Tools and techniques used
1.9 Limitation of the study
Chapter -2 2.1Organizational overview

2.2 Vision of Bangladesh Krishi Bank
2.3 Mission of Bangladesh Krishi Bank

2.4 Objectives of BKB
2.5 Features of BKB

2.6Principle activities
2.7 Products and Services of Bangladesh Krishi Bank
2.8 Products and Services, Schemes & Special Features of
BKB
2.9 Human Resource Management of the Branch
2.10 Performance of BKB
2.11 Corporate governance & regulatory compliance
2.12 Branch information
2.13 Management:
2.14 Highlights on the overall Performance Of BKB
Chapter -3 3.1 Literature Review
3.2 What is disbursement?
3.3 What is loan recovery?
3.4 What is loan?
3.5 Meaning of Loans and Advances

3.6 Types of loans
3.7 Utility of Loans and Advances
3.8 Categories of Lending of Money
3.9 Purposes of taking Loan

3.10 Procedure of granting Loans
3.11 Credit risk
3.12 Recovery of loans
3.13 Steps for Loan Recovery
3.13 Steps for Loan Recovery

Chapter -4 4.1 Agriculture Loan
4.2 SME loan
4.3 Corporate Finance and Other Project Loans
4.4 Syndicate Loan
4.5Continuous loan
4.6 Staff loan:
4.7 Corporate financing
4.8 Interest of loan

Chapter -5 5.1 Loan disbursemenr and recovery Procedures of BKB
5.2 BKBs Credit Disbursement Program
5.3 Process of Agricultural credit
5.4 Pre requisite condition before and after sanction a Loan

5.5 Documents for Loans and Advances
5.6 Management
5.7 Types of loan management
5.8 Management structure & responsibility
5.9 Approval Authority
5.10 Loan recovery procedure 4
5.11 Loan-pricing method

Loan disbursement and recovery system | Bangladesh Krishi
7 Bank
Chapter -6 6.1 Loan Disbursement and growth rate of Bangladesh Krishi
Bank Last 6 years
6.2 Loan disbursement in agriculture sector
6.3 Growth rate last four years

6.4 Financial Analysis
6.5 Agriculture loan disbursement from BKB sylhet
corporate FY2011-2012
corporate FY2012-13

corporate FY2013-14
corporate FY2014-16
6.9 Graph: 1 GRAPHICAL PRESENTATION LAST FOUR
YEARS
6.10 graph 2 Recovery rate of agriculture loan last
four
years
6.11 SME loan disbursement
6.12 SME loan disbursement from bkb sylhet
corporate
6.13 Recovery rate of SME loan

6.14 Tea loan disbursement from BKB corporate last five
years
6.15 Tea loan disbursement from BKB corporate last five
years
6.16 Recovery rate of tea loan last five years
6.17Loan disbursement of BKB corporate sylhet

compare with other bank
6.18 Loan disbursement and recovery among three banks:
6.19Funding
6.20 Why Recovery takes so much time
Chapter -7 Recommendation s and conclusion
7.2 Conclusion
8 Loan disbursement and recovery system | Bangladesh Krishi

Bank
7.4 Reference :
7.5
9 Loan disbursement and recovery system |

Bangladesh Krishi Bank
CHAPTER -1
INTRODUCTION
10 Loan disbursement and recovery system |

CHAPTER-1
Introduction
1. 1 Introduction:
In the modern world, banking sector plays a vital role in the economic development of a
country. banking sector of a country can will be said barometer of its economic growth. now a
day we live in global village world becomes smaller to information technology.
Banks play an important role in the business sector and industrialization of a country. Basically
bank collects deposits from the surplus units and lends it to the deficit units against interest for a
certain period. Under this sphere, the bank offers different interest notes and other options to
their customers to deposit and remit money. Most of the common between the banks, only the
customer service and other facilities are vary. A significant growth in the GDP was attained
during the past few years despite a host of adverse external sector developments like South-
East Asian crisis and recent recession and various domestic activities including devastating
foods. In the back ground of liberalization of the economic policies in Bangladesh, there are
many government banks, semi government banks, private and foreign banks.
Bangladesh Krishi Bank (BKB) is a 100% government owned specialized Bank in Bangladesh.
KRISHI means Agriculture. Since its inception, BKB is financing in agricultural sector
remarkably. BKB also performs commercial banking. People working abroad can easily send
money home through our Taka Drawing Arrangement.
The major occupation of the people of Bangladesh is "Krishi". Krishi is a Bengali word which
means "Agriculture". About 85% of the population depends directly or indirectly on agriculture
which contributes a significant portion to GDP.
Bangladesh Krishi Bank (BKB) has been established under the Bangladesh Krishi Bank order
1973 (President's Order No 27 of 1973). BKB is a Banking Company under the Banking
Company Act-1991. Its Head Office is located at Krishi Bank Bhaban,83-85 Motijheel
Commercial Area, Dhaka-1000, Bangladesh.
Loan comprise the most important assets as well as the primary source of earning for the
banking financial institution .on the other hand ,this loan is also the major source of risk for the
bank management. A product bank management should always try to make an appropriate
balance between its return and risk involved with the loan portfolio.

1.2 Origin of the report:
Master of Business administration MBA course requires a three month attachment with an
organization followed by a report assigned by the faculty supervisor. i took the opportunity to do
my report in Bangladesh Krishi Bank, sylhet corporate branch . Actualy this is a feedback which
department accept from the student who join in an organization after the completion of
theoretical part of MBA program. my faculty supervisor Mr. Md. Rezaul karim Assistant
Professor,department of business administration Sylhet International University, instructed
me to prepare a report on loan disbursement and recovery system of Bangladesh Krishi Bank, a
study on sylhet corporate branch, as part of the fulfilment of MBA course requirement.
1.3 Significance of the Report:
Only a lot of theoretical knowledge will be little important unless it is applicable in the practical
life Any academic course of the study has a great value when it has practical application in the
real life. It is also known to all of us that there is known alternative of practical knowledge and
the practical knowledge is much more durable and useful than the theoretical knowledge. This
study will help us to draw a true picture of the practical business world, particularly of banking
business and also to attain practical knowledge on the various spheres of banking business.
Such an application is made possible through internship.
1.4 Scope of the report:

As I was sent to Bangladesh Krishi Bank, Sylhet corporate branch, the scope of the study is
only to this branch. The report covers details about Bangladesh Krishi Bank (especially loan
disbursement and recovery system of Bangladesh krishi bank).
1.5 Objective of the report:

The objective of the report may be viewed as:
Primary Objective
Secondary Objective

Primary Objective:
The primary objective of the report are as follows:

To fulfill the partial requirement of the internship program as a full credit subject of BBA
program
Emphasizing on consumer loan operation and its impact on the profit of BKB.
Secondary Objective:
More specifically, this study entails the following aspects:

To have a sound understanding of loan operation and procedure followed in the
Bangladesh krishi bank.
To gain knowledge about the loan disbursement and recovery related operations and
maintenance in this bank.
To analyze in detail the affect of loan on the bank profitability.
To identify the factor related with the loan that must be considered and analyzed by the
bank for efficient and effective performance.
To have expose on the banking environment of Bangladesh.
To have a clear understanding of the business operation of Bangladesh Krishi Bank.
To discuss the services offered by Bangladesh Krishi Bank.
To evaluate the factors affecting daily work of the bank.
1.6 Methodology of the report:
Type of research:
This is the descriptive typed of study.
While conducting the study, sources were explored for primary information and data. But hardly
any updated data could be found. In the absence of update information or data dependence on
secondary has been inevitable. However, where possibly primary data has been used. Data
were also collected by interviewing the responsible officers and form some documents &
statements printed by the bank and the website of BKB.

Sources of Data:
Both primary and secondary source of data are used to complete this study. These two
sources are explained below:
Primary data:
Official record of BKB.

Practical desk work.
Face to face conversation with the officers and clients.
Data collection of own supervision.
Secondary data:
Officials files and folders.

Annual reports of BKB.
Working papers.
Memo and circular.
Published and unpublished documents.
Website.
1.7 Rational of the report:
Have an idea about the banking sector of Bangladesh.

Investing the banks credit function specialy function of loan.
Understand the recent trends and practice associated with loan.
Have an idea about the overall performance of Krishi Bank .
Providing a clear idea about the importance of loan in banking sector.
Recommendation on further betterment & improvement of the banking system of BKB.
1.8 Tools and techniques used:

Microsoft office word.
Microsoft excel.

1.9 Limitation of the study:
Throughout the period of making this report, I goat know a lot about investment banks activities. But
still that was not enough. There are some limitation that I cant ignore. The main limitation were
v Some limitations of the report are:

v This report only consider the area of loan
v Time was not enough to prepare the report.
v Employees was very busy to give their valuable time.
v Management doesnt want to disclose secret information
v Less time to work on as I came back from office at 6 pm.
v Hesitance to share all types of information on the part of the Bank
v Lack of availability of sufficient data.
v Some customer were afraid to give us the information as they are not familiar with this
kind of question.
It is requested to overlook the error in the report by considering the genuine efforts to avoid
these errors as much possible to do.

CHAPTER -2
ORGANIZATIONAL OVERVIEW

CHAPTER-2
ORGANIZATIONAL overview
2.1ORGANIZATIONAL overview:
Bangladesh Krishi Bank is 100% govt. owned specialized bank in Bangladesh. KRISHI means
agriculture in Bangladesh. Since its inception Bangladesh Krishi Bank (BKB) is financing in the
agricultural sector remarkably. BKB also performs commercial banking. People work abroad can
easily send home through our TAKA DRAWING arrangement. The major occupation of
Bangladeshi people is KRISHI which means agriculture. About 85% of our people depend on
the agriculture which contributes a significant portion to our GDP. And BKB is working to
improve agricultural sector of the Bangladesh.
Bangladesh Krishi Bank has been established as a full Government owned bank under
Presidential Order 27 of 1973. BKB is a Financing company under Banking Company Act-1991.
Now it has 1010 branches all over Bangladesh. Objectives of BKB is to provide credit facilities
to the farmer for the development of agriculture and entrepreneurs engaged in development of
agro-based as well as Cottage industries. The bank is guided in accordance with the policies
and principles of the Government of the Peoples Republic of Bangladesh. In providing loan
bank always give priority to the poor farmers and SME loans for the small entrepreneurs. It is
somewhat different in some respects of risks because the loan risk is higher in this bank. And it
also takes an essential part in the national development process.

Bangladesh krishi bank at a glance:
SL NO Key Point Particulars
01 Name of the Bank Bangladesh Krishi Bank
02 Logo of the Bank
03 Date of Incorporation June 02, 1973
04 Inauguration of First Branch August 01, 1975

05 Company Registration No ***********
06 Bangladesh Bank Permission No *************

07 Status Government of Bangladesh owns Bangladesh Krishi
Bank
08 Chairman
09 CEO & Managing Director
10 Company Secretary
11 Number of Branches 1026
12 Proposed Branches
13 Number of Employees
14 Authorized Capital Taka 15,000 Million
15 Paid-up Capital Taka 9,000 Million
16 Corporate Head Office Krishi Bank Bhaban, 83-85 Motijheel

Commercial Area, Dhaka-1000, Bangladesh.
17 BKB SWIFT Code BKBABDDH
18 Credit Rating Long Term (Adequate Safety)

Short Term (Good Grade)
19 Corporate Website & Email www .krishibank.org.bd
Email: www .krishibank.net
Table 3.1: Bangladesh Krishi Bank at a Glance

2.2 Vision of Bangladesh Krishi Bank:
Bangladesh Krishi Bank believes in togetherness with its customer, in its march on the road to
growth and progress with services. To achieve the desired goal, there will be pursuit of
excellence at all stages with a climate of continuous improvement, because,
Bangladesh Krishi Bank believes the line of excellence is never ending. Banks strategic plans and
networking will strengthen its competitive edge over others in rapidly changing competitive
environment. Its personalized quality service to the customers with the trend of constant
improvement will be cornerstone to achieve our operational success.
2.3 Mission of Bangladesh Krishi Bank:
Bangladesh Krishi Bank has chalked out the following corporate objectives in order to ensure
smooth achievement of its goals:
v To be the most caring, customer friendly and service government bank.

v To ensure ethics and transparency in all levels.
v To ensure sustainable growth and establish full value of the shareholders.
v Above all, to add effective contribution to the national economy.
v Eventually the Bank emphasizes on:
v Providing efficient customer service
v Being trusted repository of customers money and their financial adviser
v Making its products superior and rewarding to the customers
v Display team spirit and professionalism
v Sound Capital Base
v Fulfilling its social commitments by expanding its charitable and humanitarian activities.

2.4 OBJECTIVES OF BKB:
Bangladesh is mainly an agricultural country. The infrastructures of the country are mainly
based on agriculture. More than 60% of our labor force is related with agriculture or agriculture
based industries. As its name suggest, Bangladesh Krishi Bank is mainly established for the
development of the agricultural sector. If it can be possible to make the agricultural sector of a
country as one of the profitable sector than it would also be possible to reduce the poverty level
of Bangladesh. So the main objective of BKB is to make the agricultural sector as one of the
profitable sector of the country. And to increase the standard of the living of the people.
Agriculture is one of the most uncertain and risky sector to finance. But BKB is financing in the
agricultural sector. The main objectives of BKB are as follows:
v Development of the agricultural sector and the agricultural based activities of the
country.
v Help to make the agro-based product marketable.
v To strengthen the rural economy.
v To ensure proper economical development of Agro-based industries and small
entrepreneurs by providing loans.
v To select the new sectors of agro-based products and take initiatives to develop the
sector by providing loans and marketing support.
v BKB provides financial support to the entrepreneurs of the products which have enough
probability to export.
v Financing the marginal farmers is one of the important objectives of BKB.
These are the prime objectives of Bangladesh Krishi Bank. Besides BKB also provides financial
help to the poor farmers after every calamity to cope up with the situation.
2.5 FEATURES OF BKB:
v BKB has an authorized capital of tk. 15000 Million only and paid up capital tk. 9000
Million only which is fully paid by the government.
v Bank has started commercial functioning since 1977.
v The bank operates its function through 952 branches (Rajshahi Division) of which 822
(86%) rural and 130 (14%) are Urban.
v It has 14 Foreign exchange (Authorized Dealer) branches.
v In the field level the bank has 8 divisional and 51 regional offices for close supervision of
the branch activities.
v For smooth working bank has also 56 field level audit offices at divisional and regional
levels.
v Among the 952 branches

2.6PRINCIPAL ACTIVITIES:
The bank provides all kinds of commercial banking services to its customers through its
branches in Bangladesh. Generally it provides loan to individuals and corporate bodies related
to:
v Production of Crops.
v Purchase of Irrigation Machinery and Equipment
v Development of Horticulture
v Pisciculture and finally
v Animal Husbandry.
The bank gives emphasis to establish small agro-based cottage industries at both urban and
rural areas by way providing technical and financial supports. The Bank, within its
constitutions put priority as far as possible and extend loan to small and marginal farmers.
The bank as such is discharging its duty to the society side by side its responsibility as a
financial institution. 212 branches have already been computerized.
2.7 Products and Services of Bangladesh Krishi Bank:
Letter of Credit (LC)

Bill purchase/Discount
Export Credit (Pre Shipment & Post Shipment)
Remittance (Inward, Outward)
Collection, Purchase and Sale of Foreign Currency and Travelers Cheques.
Maintenance of Student education file.
Guarantees in Foreign Currency.
Foreign Currency accounts.
NFCD (Non-Resident Foreign Currency Deposit) A/C.
RFCD (Resident Foreign Currency Deposit) A/C
Forward Contracts
Correspondent Banking Relations.
Taka Drawing Arrangement
Dealing Room

2.8 Products and Services, Schemes & Special Features of BKB:
Products and Services Schemes Special Features
Commercial Banking BKB Monthly profit Privilege Banking

scheme
Retail Banking Bkb shanchy scheme Term Finance
Wholesale Banking BKB Green Energy Loan Working capital

Finance
Foreign Currency BKB Small Business Loan Trade Finance
Account
SME Banking BKB School banking Offshore Banking
Online Banking BKB double benefit Syndication and
schemer Structured Finance
ATM Services BKB deposit scheme FDR
Debit Card Education deposit scheme SND (Special
Notice Deposit)
Employee profident
Export Import Finance fund
Real Time any branch BKB Sanchay scheme
Banking
Tele Banking Hazz deposit scheme
Remittance Monthly benefit scheme
Locker Service Teacher benefit scheme
Table 3.3: Products and Services, Schemes & Special Features of BKB

2.9 Human Resource Management of the Branch:
Efficiency and competence is the unavoidable precondition for the sustenance and
growth of the company. There are 11 employees in the branch. The hierarchy of the
branch is shown below-
Figure 4.1: Hierarchy of BKB Sylhet corporate Branch

2.10 PERFORMANCE OF BKB:
As on 30th June, 2013 total assets (including contingencies) went up to Taka 140815 million
from Taka 117823 million of 2011. During the same period operating profit has increased to Taka
3304 million from Taka 1787 million of 2011.
REND OF BRANCH EXPANSION:
Year Urban Branches Rural Branches

2009-2010 128 803
2010-2011 129 810
2011-2012 129 811
2012-2013 130 817
2013-2014 130 822
DEPOSITS:
Deposit is the largest source of bank funds. It is assumed that a medium size bank
collects 85%-90% of its bank fund through deposits. To strengthen the base of the
banks fund BKB emphasizes of collecting deposits. There are mainly four types of
deposits. They are given below:
1. Fixed deposits.
2. Savings deposits.
3. Current deposits.
4. Short Notice Deposit (SND)
The year wise deposit mixes are given below:
TYPES OF DEPOSITS 30-06-2012 30-06-2013 30-06-2014

FIXED DEPOSITS 2789.23 3638.74 4553.11
SAVINGS DEPOSITS 2351.67 2421.85 2724.04
CURRENT DEPOSITS 493.27 549.34 603.62
SND & OTHERS 1227.60 1341.77 1517.57
TOTAL 6861.77 7951.70 9398.34
*Data: annual closing report

Deposit mix is the combination of various types of deposits of Bangladesh Krishi Bank. These
deposits are consists of Fixed, Savings, Current deposits and others type of deposits. For the
year 2014 the DEPOSIT MIX of BKB, Fixed are 48% of the total, Savings are 29%, Current
deposits are 7% and others are 16% of the total deposit.
LOAN AND ADVANCES:
Bangladesh Krishi Bank is following the PONCHO BARSHIKI NITIMALA of the government
from the year 2011-12.And working for the establishment of these planning. BKB has provided
4003.20 cores Taka as loan and advance in the year 2011. And in the year 2010 it was 3441.56
cores. Which are approximately 561.64 cores more than the previous year. The lion portions of
the loans provided by BKB are provided to the agricultural sector and in the agro-based
industry. And which is also an indicator of banks dedication towards the development of the
agricultural sector of the country.
INVESTMENT
BKB also does the work of investments. Investment is one of the major sources of the uses of fund.
BKB mainly invests on various Bonds, Debentures and shares. In the year 2011 the total amount
invested by BKB was 1,511,989,500 Taka. Of which Share was 34,439,000 Taka and Bond was
1,477,550,500 and in the previous year it was about 1,491,694,500 taka.
EXPORT BUSINESS
The total quantum of Export business handled by the Bank in 2011 stood at Tk.1346.70 core
Taka as compared to the volume of Tk.1084.45 in 2010 registering an increase of 262.25 cores
Taka.
IMPORT BUSINESS
Import business handled by the Bank during the year 2011 amounted to Tk. 2297.94 core Taka
as against Tk.1813.00 core Taka of the preceding year registering an increase of 484.94 cores
Taka.

REMITTANCE
There are two types of remittances, one is the inward remittance and another one is the
outward remittances. In the year 2010 total inward remittances were 687.78 cores but in the
year 2011 it is 951.27 cores. Which were 263.49 cores higher than the previous year. And
the outward remittance was 9.46 in 2010 and in 2011 it is 17.21.
MODERNIZATION OF THE BRANCHES
To ensure quality of services to the customers BKB is computerizing its branches. At

present regional office, Head office and other Divisional Branches are computerized. In
2010-11 fiscal years there 162 branches have been computerized. And to ensure quality
and quick service there has been opened one stop services in this branches. Providing
online Banking service is under processing in some important branches.
AUDITORS OF THE BANK
The Audit Firms M/s. Zoha Zaman Kabir Rashid & Co and Kazi Zahir & co. jointly has done
audit and Inspection of the Books of Accounts of the Bank for the accounting year ended 30 th
June 2013 jointly.
2.11CORPORATE GOVERNANCE & REGULATORY COMPLIANCE
Eastern Bank Limited practiced the principles of good corporate governance over the years that
covered compliance of regulatory requirements, responsive to various stakeholders. Spirit of
corporate governance also included practicing of the corporate culture within the organization
and shared this by the employees.
Eastern Bank Limited complied with all the regulatory guidelines prescribed by the Banking
Companies Act, Bangladesh Bank, National Board of Revenue and Securities & Exchange
Commission, International Accounting Standards, etc.

2.12 BRANCH INFORMATION:
I got chance to work as an officer in the Sylhet Corporate Branch of Bangladesh Krishi
Bank. The bank is located at Zindabazar sylhet, There I obtained practical knowledge of
working at various departments.
(Amounts are in Taka)
Branch Name BKB Corporate

Branch,Zindabazar,Sylhet,Bangladesh
Location Krishi Bank Babon,Zindabazar

Sylhet,Bangladesh
Number of Office Staffs 20 ( 1 D.G.M,1 A.G.M, 2 S.P.O, 2
P.O, 3 S.O, 4 Officer, 3 supervisor, 2
cashier, 4 GO)
Name of the Branch Manager

Total Loan Disbursement 916,45,000
Loan Recovery 8,63,88,000
Total Deposits 55,27,16,000
Total Expenses 4,07,41,000
Total Revenue 6,24,12,000
Total Profit 3,16,71,000
Total Assets 3,38,39,59,000
*Data: office record

2.13 Management:
It is reflected from the analysis that almost every year management of BKB has opened new
branches. Now BKB has 973 branches. However, management should open up more new
branches for the overall development of agricultural sector of Bangladesh. The agricultural
banks have created employment opportunities for more than twelve thousand people in
Bangladesh. However, we have found that the bank lost its employees during the year 2011 to
2011 but it has regained its manpower at the end of 2011. Even worse, BKB employee turnover
will continue in the future. These indicate that the prospect of employees in the bank is very
poor. The management should take remedial measures to reduce their employee turnover.
LOAN MANAGEMENT:
Loan management is the process for controlling and collecting payments from your customers.
A good loan management system will help you reduce the amount of capital tide up with debtors
(people who owe you money) and minimize your exposure to bad debts.
Good loan management is vital to cash flow. It is possible to be profitable on paper and but lack
the cash to continue operating in business.
LOAN MANAGEMENT POLICY:
Loan management policies help the loan department operate more efficiently. Loan
management policies are rural & guidelines established by top management that govern the
companys loan department and its performance in the extension of loan privileges. Loan
procedures are employed to achieve the goals of loan management policies.

2.14 Highlights on the overall Performance Of BKB
Taka in Million
SI No Particulars 2013 2014

1. Paid up capital 3500 3000
2. Capital & Reserve 5040.80 4368.68
3. Capital surplus/(shortfall) (28117.82) (26059.73)
4. Total Asset 117823.02 105735.52
5. Total deposit 80308.53 71623.19
6. Total Loans and Advances 89141.85 78443.84
7. Contingent Liabilities and other10905.06 6353.91
commitments
8. Credit deposit Ratio 111% 109%
9. Percentage of classified loan against total26.45% 34.98%
loans and advances
10. Profit after Tax and Provision (1966.38) (1487.69)
11. Amount of Classified loan 23575.22 27440.05
12. Provision against classified loan 3590.70 4157.15
13. Provision excess/(short fall):
*Loans and Advances (8627.84) (7310.21)
*Other Asset (7504.20) (7059.54)
14. Cost of fund 7.91% 7.51%
15. Interest earning Asset 67452.84 54817.56
16. Non-Performing Asset 50370.19 50917.96
17. Return on Investment (ROI) (-)4.22% (-)4.32%
18. Return on Asset (ROA) (-)1.66% (-)1.40%
19. Income from Investment 81.49 80.24
Data: Yearly Journal 2013 & 2014

CHAPTER -3
LITERATURE REVIEW
30 Loan disbursement and recovery system | Bangladesh

Krishi Bank
Chapter -3
Literature Review
Theoretical Review of Loan Disbursement System of Commercial Banks in Bangladesh
3.1 Literature Review:
3.2 What is disbursement?
Usually when you are granted a loan it will have 2-3 disbursement. Think of a disbursement as a
payment.If half of your loan pays out to the school, you will begin paying interest on that
amount. When the second disbursement comes in, you will begin paying interest on that next
amount.
3.3 What is loan recovery?
Collection of a loan amount from a borrower in default.

Collection of receivable that were written of as bed debt
Absorption of a cost through its allocation to an appropriate account.
In finance the term recovery refers to collection of amount due. the normally recovery depends
on the purpose ,time and condition ,business running process etc.
Normally loan amount will be recovered on installment basis. The manager can fix installment
period on the basis of nature of their business.
Example :
Installment fixes on salaried person on the monthly basis.
In agriculture sector installment fixes on half yearly.
Business person normally 1 year per installment.
Recovery is different from one loan to another.
In short term loan is recovery is less than 36 month

In medium term loan recovery from 36 months to 84 months.
In long term loan normally recovery from 84 months and above.

3.4 What is loan?
v Loan can be defined as the landing of a sum of money by a lender to a borrower to be
repaid with an certain amount of interest (Dictionary of banking and finance)
v Timothy W Koch defined loan as formal agreement between a bank and borrower to
provide a fixed amount of credit for a specified period.
v Loan is the means of investment made by the bank to the entrepreneurs and business
community. Alternatively this is the way of channelling fund to the deficit units where
various risks and uncertainties are involved. There for every decision on credit matter
should be taken with utmost care that can be ascertained through in-depth analysis
.meticulous calculation and prudent judgment.
v A loan may be defined as money lent at interest or on profit. It is nothing but temporarily
parting with ones resources in order to augment the purchasing power of the receiver of
such facility with a promise to return the same with interest/profit or otherwise as
mutually agreed upon.
According to Wikipedia:
In finance, a loan is a debt provided by one entity (organization or individual) to another entity at
an interest rate, and evidenced by a note which specifies, among other things, the principal
amount, interest rate, and date of repayment. A loan entails the reallocation of the subject
asset(s) for a period of time, between the lender and the borrower. In a loan, the borrower
initially receives or borrows an amount of money, called the principal, from the lender, and is
obligated to pay back or repay an equal amount of money to the lender at a later time.
Tropically, the money is paid back in regular instalments, or partial repayments; in an annuity,
each instalment is the same amount.
According to Investopedia:
The terms of a standardized loan are formally presented (usually in writing) to each party in the
transaction before any money or property changes hands. If a lender requires any collateral, this will
be stipulated in the loan documents as well. Most loans also have legal stipulations regarding the
maximum amount of interest that can be charged, as well as other covenants such as the length of
time before repayment is required. Loans can come from individuals, corporations, financial
institutions and governments. They are a way to grow the overall money supply in an economy as
well as open up competition, introduce new products and expand business operations. Loans are a
primary source of revenue for many financial institutions such as banks, as well as some retailers
through the use of credit facilities.

3.5 Meaning of Loans and Advances:
The term 'loan' refers to the amount borrowed by one person from another. The amount is in the
nature of loan and refers to the sum paid to the borrower. Thus, from the view point of borrower,
it is 'borrowing' and from the view point of bank, it is 'lending'. Loan may be regarded as 'credit'
granted where the money is disbursed and its recovery is made on a later date. It is a debt for
the borrower. While granting loans, credit is given for a definite purpose and for a predetermined
period. Interest is charged on the loan at agreed rate and intervals of payment. 'Advance' on the
other hand, is a 'credit facility' granted by the bank. Banks grant advances largely for short-term
purposes, such as purchase of goods traded in and meeting other shorter trading liabilities.
There is a sense of debt in loan, whereas an advance is a facility being availed of by the
borrower. However, like loans, advances are also to be repaid. Thus a credit facility- repayable
in instalments over a period is termed as loan while a credit facility repayable within one year
may be known as advances. However, in the present lesson these two terms are used
interchangeably.
3.6 Types of loans:
Secured Loan
Secured loans are those which are granted against the security of tangible assets, like stock
in trade and immovable property. Thus, while granting loan against the security of some
assets, a charge is created over the assets of the borrower in favour of the bank. This
enables the bank to recover the dues from the customer out of the sale proceeds of the
assets in case the borrower fails to repay the loan.
Unsecured Loan:
Unsecured loans are those loans which are not covered by the security of tangible assets. Such
loans are granted to firms/institutions against the personal security of the owner, manager or
director. Commercial banks grant loans for different periods-long, short and medium term for
different purposes.
Short-term loans
Short term loans are granted by banks to meet the working capital needs of business. The
working capital needs refer to financial needs for such purposes as, purchase of raw materials,
payment of wages, electricity bill, taxes etc. Such loans are granted by banks to its borrowers to
be repaid within a short period of time not exceeding 15 months. Short term loans are normally
granted against the security of tangible assets like goods in stock, shares, debentures, etc. The
rate of interest charged on short term loans ranges from 12% to 18% p.a.

Term Loans
Medium and long term loans are generally known as 'term loans'. These loans are granted for
more than 15 months. In case of medium term loan, the period ranges Irom 15 months to less
than 5 years. Medium term loans are generally granted for heavy repairs, expansion of existing
units, modernization/renovation etc. Such loans are sanctioned against the security of
immovable assets. The normal rate of interest ranges between 12% to 18% which depending
upon the period, purpose, nature and amount of the loan. Though banks may grant long term
loans, they avoid granting loan for more than 5 years.
3.7 Utility of Loans and Advances

Loans and advances granted by commercial banks are highly beneficial to individuals, firms,
companies and industrial concerns. The growth and diversification of business activities are
effected to a large extent through bank financing. Loans and advances granted by banks help in
meeting short-term and long term financial needs of business enterprises. We can discuss the
role played by banks in the business world by way of loans and advances as foUows:-
(a) Loans and advances can be arranged from banks in keeping with the flexibility in business
operations. Traders may borrow money for day to day financial needs availing of the facility of
cash credit, bank overdraft and discounting of bills. The amount raised as loan may be repaid
within a short period to suit the convenience of the borrower. Thus business may be run
efficiently with borrowed fimds fi-om banks for financing its working capital requirements.
(b) Loans and advances are utilized for making payment of current liabilities, wage and salaries of
employees, and also the tax liability of business.
(c) Loans and advances fi-om banks are found to be 'economical' for traders and businessmen,
because banks charge a reasonable rate of interest on such loans/advances. For loans from
money lenders, the rate of interest charged is very high. The interest charged by commercial
banks is regulated by the Reserve Bank of India.
(d) Banks generally do not interfere with the use, management and control of the borrowed money.
But it takes care to ensure that the money lent is used only for business purposes.
(e) Bank loans and advances are found to be convenient as far as its repayment is concerned. This
facilitates planning for fiiture and timely repayment of loans. Otherwise business activities would
have come to a halt.

3.8 Categories of Lending of Money:
Commercial banks lend money in four different ways:
(a) Direct loans, (b) cash credit, (c) overdraft, and (d) discounting of bills.
These are briefly discussed below;
(a) Loans:
Loan is the amount borrowed from bank. The nature of borrowing is that the money is disbursed
and recovery is made in instalments. While lending money by way of loan, credit is given for a
definite purpose and for a pre-determined period. Depending upon the purpose and period of
loan, each bank has its own procedure for granting loan. However the bank is at liberty to grant
the loan requested or refuse it depending upon its own cash position and lending policy. There
are two types of loan available from banks:
(i) Demand loan, and
(ii) Term loan - -
(i) A Demand Loan:
A Demand Loan is a loan which is repayable on demand by the bank. In other words, it is
repayable at short-notice. The entire amount of demand loan is disbursed at one time and the
borrower has to pay interest on it. The borrower can repay the loan either in lump sum (one
time) or as agreed with the bank. For example, if it is so agreed the amount of loan may be
repaid in suitable instalments. Such loans are normally granted by banks against security.
(ii) Term Loans:
Medium and long term loans are called term loans. Term loans are granted for more than a year
and repayment of such loans is spread over a longer period. The repayment is generally made
in suitable instalments of a fixed amount. Term loan is required for the purpose of starting a new
business activity, renovation, modernization, expansion/ extension of existing units, purchase of
plant and machinery, purchase of land for setting up of a factory, construction of factory building
or purchase of other immovable assets. These loans are generally secured against the
mortgage of land, plant and machinery, building and the like.
(b) Cash credit:
Cash credit is a flexible system of lending under which the borrower has the option to withdraw
the funds as and when required and to the extent of his needs. Under this arrangement the
banker specifies a limit of loan for the customer (known as cash credit limit) up to which the
customer is allowed to draw. The cash credit limit is based on the borrower's need and as
agreed with the bank. Against the Umit of cash credit, the borrower is permitted to withdraw as
and when he needs money subject to the limit sanctioned.

It is normally sanctioned for a period of one year and secured by the security of some tangible
assets or personal guarantee. If the account is maintaining satisfactorily, the limit of cash credit
may be renewed by the bank at the end of year. The interest is calculated and charged to the
customer's account. Cash credit, is one of the types of bank lending against security by way of
pledge or /hypothetication of goods. 'Pledge' means bailment of goods as security for payment
of debt. Its primary purpose is to put the goods pledged in the possession of the lender. It
ensures recovery of loan in case of failure of the borrower to repay the borrowed amount. In
'Hypothetication', goods remain in the possession of the borrower, who binds himself under the
agreement to give possession of goods to the banker whenever the banker requires him to do
so. So hypothetication is a device to create a charge over the asset under circumstances in
which transfer of possession is either inconvenient or impracticable.
(c) Overdraft:
Overdraft facility is more or less similar to 'cash credit' facility. Overdraft facility is the result of an
agreement with the bank by which a current account holder is allowed to draw over and above
the credit balance in his/her account. It is a short-period facility. This facility is made available to
current account holders who operate their account through cheques. The customer is permitted
to withdraw the amount of overdraft allowed as and when he/she needs it and to repay it
through deposits in the account as and when it is convenient to him/her. Overdraft facility is
generally granted by a bank on the basis of a written request by the customer. Sometimes the
bank also insists on either a promissory note from the borrower or personal security of the
borrower to ensure safety of amount withdrawn by the customer. The interest rate on overdraft
is higher than is charged on loan. The following are some of the benefits of cash credits and
overdraft :-
(i) Cash credit and overdraft allow flexibility of borrowing, which depends upon the need of the
borrower.
(ii) There is no necessity of providing security and documentation again and again for
borrowing funds.
(iii) This mode of borrowing is simple and elastic and meets the short term financial needs
of the business.
(d) Discounting of BiUs: Apart from sanctioning loans and advances, discounting of bills of
exchange by bank is another way of making funds available to the customers. Bills of exchange
are negotiable instruments which enable debtors to discharge their obUgations to the creditors.
Such Bills of exchange arise out of commercial transactions both in inland trade and foreign
trade. When the seller of goods has to realize his dues from the buyer at a distant place
immediately or after the lapse of the agreed period of time, the bill of exchange facilitates this
task with the help of the banking institution. Banks invest a good percentage of their funds in
discounting bills of exchange. These bills may be payable on demand or after a stated period. In

discounting a bill, the bank pays the amount to the customer in advance, i.e. before the due
date. For this purpose, the bank charges discount on the bill at a specified rate. The bill so
discounted is retained by the bank till its due date and is presented to the drawer on the date of
maturity. In case the bill is dishonored on due date the amount due on bill together with interest
and other charges is debited by the bank to the customers account.
3.9 Purposes of taking Loan:
It seems that not everybody could live luxuriously and we should be thankful that financial institutions
are aware of that. So, here are some reasons and purposes for a loan.
Business Launching
A few other businesses are capital intensive whereas others are labor intensive. Whenever a
business tumbles down into previous category, there will be a huge need for loan application.
House Buying
It's going to be a very huge expense for sure including the house's initial cost and the furniture.
Thus, we tend to settle for a loan.
Home Improvement
Not everybody has a well-planned house from the start. Some just bulk a house from the
scratch out of very affordable materials but could easily damage. After so many years, roof
might need to be fixed and some other parts of the house. In that case, there's a need for a loan
application. ' Investments The costs of property these days are enormously soaring and there
may be no better technique to maximize the level of investment you might have as compared
with buying certain property and assets. Wait around for the value to increase and after that sell
it- what could possibly be easier? Ending up with a loan intended for this specific purpose is the
most sensible thing that can be done in life.
Clearing Away from Financial Obligations

Should a business has to turn out or perhaps an individual fails to know the right way to deal
with his finances, then he will probably get into financial obligation. It's good to know that there
exists a particular loan which one can find solely for this particular purpose- which is, to guide
you get rid of the financial chaos. One particular loan is known as Debt Consolidation Loan that
you can utilize to incorporate the varied debt costs and settle everything off all at once.

Education
Universities these days offer student loans making it easier so they can manage to pay
frothier educational costs and in many cases insure living expenses as well. The student
has to provide evidence that he or she doesn't have sufficient funding before applying for
this particular loan. The good thing there is that rates of interest are certainly not overly
high. Due to the fact that this loan is marginally not the same as the others, it is a good idea
that you go over the whole process before you apply.
Emergency Expenditures
Many people don't hold health care insurance or struggle to repay all of their living expenses by the
end of the month, have a tendency to make application for loans. Nevertheless, just be sure to pay
off the mandatory time frame to protect yourself from a serious uncertainty.
Car Buying
One of the hardest things to achieve today is buying a car. But people who are in need of car and
can afford the monthly amortization, car loan is available. All brides would like to have the best
wedding but then the sad thing there is, best incorporates expensive. Even so, a lot of couples find
that it's totally typical for it to cost enormous costs of money to get one sole party and in case they
don't get that sort of funding, they can always apply for a loan. They might usually take one more to
finance the ideal honeymoon in the process.
Travel
This will likely not at all make sense that much, however some folks get a loan to actually
finance a holiday vacation. A necessity could also come up when loss of life happens in faraway
place and one doesn't even have sufficient funds to pay for the entire expenses.
3.10 Procedure of granting Loans:

The procedure of applying for loan and sanction of loans and advances differs from bank to
bank However, the steps which are generally to be taken in all cases are as follow:-
(I) filling up of loan application form-

Each bank has separate loan application forms for different categories of borrowers. When you
want to borrow money from a bank, you will have to fill up a loan application form available with
the bank free of cost. The loan application form contains different columns to be filled in by the
applicant. It includes all information required about the borrower, purpose of loan, nature of
facility (cash-credit, overdraft etc) required, period of repayment, nature of security offered, and
the financial status of the borrower. A running business Hmit may be required to iSamish
additional information in respect of:

Assets and liabilities
Profit and loss for the last 2 to 3 years.
The names and addresses of three persons (which may include borrowers, suppliers,
customers and bankers) for reference purposes.
(ii) Submission of form along with relevant documents-

The loan application form duly filled in should be submitted to the bank along with the relevant
documents.
(iii) Sanctioning of loan-
The bank cutinizes the documents submitted and detentions the credit worthiness of the
applicant. If it is found to be feasible, the loan is sanctioned. The amount of loan is large or less,
normally the Branch Manager himself can take the decision and sanction the loan.
(iv) Executing the Agreement-
When the loan is sanctioned by the bank and the borrower is informed about it, he will have to
execute an agreement with the bank regarding terms and condition for the amount of loan
raised.
(v) Arrangement of Security for Loan-

The borrower will now arrange for security against the loan. These securities may be immovable
properties, shares, debentures, fixed deposit receipts, and other documents. When the borrower
completes all the formalities, he is allowed to get the amount of loan/advance/ over draft as
sanctioned by the bank. In case of discounting of bills', the bank credits the amount of bill to the
customer's account before the realization of the bill and thus, makes available the fund. In case,
the bill is dishonored on due date, the amount due on the bill together with interest and other
charges are payable by the party whose bill is discounted.
3.11 Credit risk:

Credit risk is the chance that a bond issuer will not make the coupon payments or principal
repayment to its bondholders. In other words, it is the chance the issuer will default.The
potential for loss due to failure of a borrower to meet its contractual obligation to repay a debt in
accordance with the agreed terms. Example: A homeowner stops making mortgage payments.
Commonly also referred to as default risk Credit events include bankruptcy, failure to pay, loan
restructuring, loan moratorium, accelerated loan payments. For banks, credit risk typically
resides in the assets in its banking book (loans and bonds held to maturity). Credit risk can arise
in the trading book as counterparty credit risk.

3.12 Recovery of loans:
Recovery refers to collection of amount due. The normally recovery depends on the purpose,
time and condition, business running process etc. Normally loan amount will be recovered on
instalment basis. The manager can fix instalment period on the basis of nature of their business.
Example; Instalment fixes on salaried person on the monthly basis.
3.13 Steps for Loan Recovery:

I. Account is placed for debt collection.
AI. Client sends information on the debt including supporting documentation. Claim is
reviewed and the data is entered into our debt collection program
BI. Demand letter is sent to debtor via fax, mail and or email and an acknowledgment letter
is sent to the Client.
IV. Phone contacts begin.
V. We attempt to arrange payment, resolve any disputes and obtain clear commitments on
debt resolution.
VI. If we obtain payment commitment we work to ensure the payment(s) materialize.
VII. If debtor fails to cooperate in resolving the debt we make final pre-legal collection
attempts.
VIII. We send our update and recommendations to the Client, including details on forwarding
claim to affiliated attorneys.
IX. The Client authorizes forwarding the claim and we send it to our affiliated attorneys that
are located near the debtor. We instruct them to work and investigate the claim for 60
days. If the Client decides not to authorize forwarding the claim, it is worked an
additional 60 days then the file is closed.
X. Attorney sends update and recommendations. If they recommend initiating legal action
they will provide us with their suit requirements
when we receive suit requirements from the Client, the lawsuit is prepared and filed. When we
do not received suit requirements or when the client is unwilling to litigate the attorneys will work
on the claim for another 60 days then close it.
The complaint is served.

Attorneys file for defauk judgment if no answer is filed by debtor. If an answer is filed
the discovery process begins and a trial date is later set.
If a judgment is awarded in our favor, attorneys file for a Writ of Attachment.
Attorneys attempt to locate and verify debtor assets.
Attorneys inkiate bank levies/ garnishment orders/ liens/ etc. to satisfy the judgment.

CHAPTER -4
LOAN DISBURSEMENT AND RECOVERY OF BANGLADESH KRISHI
BANK

CHAPTER-4
Loan disbursement and recovery of Bangladesh krishi Bank
4.1 Agriculture Loan:
BKB has formulated and implemented its loan disbursement policy. The salient features of the
above policy were as follows:
With the objective of ensuring harmonious development and growth in every phase of
agriculture and other sectors inter-related with it were brought under the purview of agricultural
credit rather than confining it to a few sectors only.
Considering potentiality and labor intensity, seven sectors were identified according to priority
for loan disbursement with the objective of diversification, modernization and commercialization
of agriculture and promotion of the standard of living of the rural people. The seven sectors for
loan disbursement are
1.Crop
2.Fishery
3 Livestock
4.Irrigation&FarmMachinery
5. Agro-Industries
6.WorkingCapital
7.SocioEconomicDevelopmentActivities
8.Others

With the objective of adding further value to agro products and promoting their market
arrangement identification and financing of new prospective projects. Such as potato products,
juice production, food processing industries etc were undertaken.
Importance was given to disbursement of credit to the entrepreneurs as per their need by
exploring potentialities under Area Approach. As for example, extending credit to the
entrepreneurs of Jessore, Sathkhira, Rangunia, Hathajari for flower cultivation and marketing.
Importance was also given to extending credit to the private organization engaged in
diversification of agro products, improvement of marketing channel and above all modernization
of agriculture. For example, financing different project of Square, BRAC, Pran, Harvest Rich,
Kazi Farms, Bay Agro, Ifad multi products and others.
To increase credit disbursements, especially in sectors like fishery, livestock, agro based
industries etc. so as to meet the increasing demand.
Main sector of loan disbursemen in Agriculture:
Crop Loan:
Crop is the most important sector in Bangladesh agriculture. Fifty percent of the total labor
force is engaged in agricultural activities and its exclusive contribution to GDP is 4.7 percent
during the year under report. BKB gives highest priority to crop loan disbursement
considering labor intensity of the crop sector and its contribution to national economy. Crop
loan constitutes 41 percent of the total disbursement of loan.
Fishery:
Fishery is a large potential sector for economic development and employment generation in
Bangladesh. It contributes a lot to GDP and helps to meet protein needs of the vast population,
earn foreign exchange through export, reduce poverty through employment generation for the
poor and improve socio economic condition of the people.

Livestock:
Livestock plays a vital role in an agro based economy like Bangladesh. Livestock
products like leather, fur and bones play a great role in earning foreign exchange. BKB
disbursed a huge amount for purchase of draft animals for cultivation of 90 percent of
the cultivable land. BKB provides credit facilities to different sub sectors of livestock for
purchasing bullock, rearing milk cow, beef fattening etc.
Farm Machineries:
BKB provides credit facilities for machineries to various organizations involved in product
diversification, value addition and export of agricultural goods. By this time the bank has
provided loan to M/S Padma Bleaching and Dying Ltd, Paragon Grand Parent Stock Farm,
M/S Sakura Flower Mills Ltd, M/S Ifad Agro Complex Ltd etc.
Irrigation and Agriculture Equipments:
BKB plays a pioneering role for increasing agricultural productivity. For this purpose the Bank
extends credit under simplified process for LLP, STW, DTW, HTW, Tractor, Power Tiller etc.
Agro based Industry:
The role of agro-based industries in a developed country like Bangladesh is enormous in

respect of commercialization of farming, diversification of export and value addition to agro
products. Keeping in this vies, BKB provides huge credit facilities for establishing different
types of agro-based projects like poultry, dairy, food and food processing plant, fish
processing plant, packaging industries etc.

Financing Socio Economic Development programs:
With its wide network of branches throughout the country BKB provides credit to the distressed
people engaged in socio economic activities. These are-
Credit program for landless and marginal farmer

Joint program for poverty alleviation
Swanirvar credit program
South East Asia Poveryt Alleviation Program
United Nation Capital Development Fund
Employment Development Program for Rural Women
BKB-NGO small credit program
Milk cow rearing program for women
Special credit program for handicraft
Micro Enterprise development program for Monipuri
Special Credit program for the Rakhains of Coxs Bazar
Ghore Fera Kormosuchi
Others:
Besides financing in the agricultural sector, BKB like other commercial banks provides credit
facilities for export and import. With the objective of expediting export performance the bank
undertakes other functions like purchase and negotiation of export bills, pre export finance.
Along with this BKB finances import sector for import of raw materials and machinery for
projects and garment industries.
Sub sectors of crop loan
Food Grain and Cash Crop:
Cereals, Cash Crops (Banana, Sugarcane, Betel leaf, Jack fruit, Guava, Betel nut, Pine apple,
Melon etc.) winter and summer vegetables.

Horticulture:
BKB attaches special importance to the expansion and diversification of programs related to
horticulture. The sub sector of horticulture:
Establishing nursery and its marketing

Growing mushroom and its marketing
Producing Capsicum, Lattus, Brukly, French Bean and another vegetables for export
extension.
Producing and marketing spices like Onion, Garlic, Zinger, Turmeric etc.
Producing bamboo and murta used in marketing mat, making betel-nut and guava
garden.
Credit program for fruit, forest, herbal nursery and gardening :
With the objective of meeting protein needs of the common people of ensuring supply of the
herbal ingredients for Unani and Ayurbad system of medical treatment BKB disburses
necessary loan on simple terms for plantation of fruit trees, forest for making government
declared National Tree Plantation Program a success. Through this credit program, BKB is
also providing employment to the rural people ensuring maximum utilization of fallow land.
Considering exkport potentialities of herbal medicine and plants government identified this
sector as a special development sector in the export policy.
Tea loan:
Tea is one of the environment friendly exportable agricultural products. BKB is the main financial
institution to provide credit in this sector. Out of 158 gardens in the country, BKB exclusively
finance 135 tea gardens. About 500 thousand people with their dependents are directly or
indirectly related to this labor-intensive industry. Side by side with the production loan BKB
provides long term loan in the tea sector for development of tea garden and for balancing,
modernization, replacement and expansion of the factory.
Tea is one of the major exportable items of the country. BKB is the exclusive financing
institution providing credit to this sector & I spend my maximum internship time in this section
and learnt some task i.e. how to maintain a file for each garden, DD, PO issue, sale report entry
to the register book etc. The Bank generally provides two types of Loan
Tea production loan is short term basis, Rate of interest is - 13%

Tea development loan is term loan, Rate of interest is - 13%

Production of Pulse, Oil seeds and Spices:
A special credit program has been undertaken jointly by BKB and the Director of Agriculture
Extension for production of pulse, oil seeds and spices covering 48 districts under the
jurisdiction of BKB. In this program 15 crops like Soybean, Mustard, Ground nut, Lentil, Gram,
Onion, Peeper, Turmeric, Zinger, Maze, Betel leaf, Tomato etc have been included. In the said
project Agriculture Extension Department will hold the responsibility to identify crop wise land,
select, motivate and train farmers. They will also monitor the program and assist production
through loan disbursement.
Maize Production:
There is a huge gap between demand and supply of maize in the country. With the demand of
maize for the increasing poultry industry and also due to its popularity as human food the gap
between its demand and local supply is widening day by day. As the land for maize cultivation is
easily available in the country and its production cost is comparatively low, prospect of maize
cultivation in the country is bright. Keeping this in view and with a consideration to minimize
dependency on its import, maize cultivation has been given priority by BKB.
Cotton production:
With the purpose of providing indigenous raw materials to the export oriented garment industry and
reducing import dependency and also for commercializing cotton cultivation BKB extends necessary
credit to the farmers engaged in cotton cultivation and marketing.
Orchid production:
In the context of huge export potentiality of orchid, BKB has come forward for lending in the sector.
The orchid projects financed by BKB have recently started exporting orchid abroad.
Flower cultivation:
Flower cultivation is a profitable business now a day. Besides huge demand in the domestic
market, it has a bright prospect for export. So considering flower cultivation as a potential sector
BKB extends necessary credit facilities on simple terms for its cultivation in Jessore, Shathkhira,
Chitagong, Ptiya, Rangunia, Hathajari and other areas.

Rubber Plantation:
Bangladesh Krishi Bank finances the private sector rubber gardens for development, production
and processing of rubber goods and its marketing.
4.2SME LOAN:
Bangladesh Krishi Bank has introduced the SME policy strategies and financing norms in
accordance with the industrial policy and Bangladesh Bank's Prudential Regulation to assist in the
achievement of Millennium Development Goals (MDGs) set by the government. BKB started SME
financing since October, 2007. SME plays a vital role in our economy. SME is one the major source
of self employment. To make skilled entrepreneur BKB finance in this sector. To establish the Brain
Resource as an important alternative to Venture capital SME loan is provided. BKB logically imposes
sufficient emphasis on it.
Major Fields for banks interest are-
1. Electrical and electronics.

2. Software.
3. Light engineering.
4. Agro-based all fields.
5. Leather and leather goods.
6. Garments.
7. Plastic and synthetics.
8. Health care.
9. Education.
10. Pharmaceuticals.
11. Faison goods.
The credit range in this sector is taka 2.0 lac to taka 500.00 lac. The interest rate is quite logical
and viable.
Interest Rate
Term Loan : 15.00%

Cash Credit/Working Capital Loan : 15.50%
Women Entrepreneur : 15.00%

Repayment
EMI (equal monthly instalment) maximum for 5(five) years and working capital for 1(one)
year.
4.3 Corporate Finance and Other Project Loans
Project loan normally has fixed maturity and it relates to term investment. As such it requires
appraisals of those proposals to have a rational decision. Appraisal may be termed as
assessment of viability over a period of time.
These loans are usually made for:
Setting up of industries and to meet working capital

Balancing, Modernization, Replacement and Expansion (BMRE) of existing industries.
OTHERS TYPES OF LOANS BY BKB:
Over draft facility is also a continuous loan arrangement on a customers current account
permitting him/her to overdraw up to a certain approved limit for an agreed period. Here the
withdrawal of deposits can be made any number of times at the convenience of the borrower,
provided that the total overdrawn amount does not exceed the agreed limit. Customer can
return any amount at any time within the pre-fixed time of the facility. Turn over of an Over Draft
facility is the most important phenomenon on which renewal of the facility depends. Over Draft
facility is given to the businessmen for financing working capital requirement and high net worth
individual to overcome temporary liquidity crisis.
Secured Over Draft
This is a type of over draft facility given to the borrowers keeping sufficient collateral from the
customer in the most liquid form. This facility provides specific right to a client to overdraw within
a pre fixed limit for a certain period of time. Secured over Draft is normally granted against the
security of tangible asset such as lien of Fixed Deposit Receipt (FDR), Bonds, Sanchaya Patra
but currently Secured Over Draft is given only against Fixed Deposit Receipt because
Bangladesh Bank has recently prohibited Secured Over Draft against Bonds and Sanchaya
Patra. Interest charged on the Secured over Draft is calculated on the basis of the security lined.

4.4 Syndicate Loan
A Bank can lend up to 15% of its paid up capital without any approval by Bangladesh Bank. If
the loan amount exceeds 50% of the paid up capital then Bank goes for Syndicate loan. Lead
Bank makes the arrangement and Head Office makes the facility agreement by the Banks
lawyer. All terms and conditions such as security sharing, mode of creating charges, mode of
repayment, covenants of the loan are written on the facility agreement.
4.5Continuous loan
Cash credit (CC hypothecations) this loan is given to the business man. it is a continuous
lending facility. Borrower is allowed to borrow money up to a certain limit and can t withdraw the
sanctioned amount at one. They are to keep mortgage against loans. interest are charged in the
withdrawal only. Continuous Loan:
The bank is providing continuous loan for different types of activities as cash
credit/working capital loan on short term basis.
Continuous loan is given for processing, preservation and marketing of agricultural
products.
4.6 Staff loan:
BKB give staff loan only to the staff of the bank. it is a low interest loan provide to them for their
social and economical development. the interest of this loan are 5 percent. this loan is
recovered by take an instalment from the monthly salary of regarding staff .
The staff loan are:
1 House building loan
2 Motor Cycle loan
3 Computer loan

4.7 CORPORATE FINANCING:
The Bank has started financing to renowned corporate bodies of the country for the last 2/3
years. This has opened a new arena of utilizing Agri-product marketing channel of the
companies in easy terms and at a lower interest rate. Such companies are:
v PRAN GROUP (Agriculture Marketing Company Ltd.)

v SQUARE GROUP (Square Consumer Products Ltd.)
v PARTEX GROUP (Partex Furniture Ltd.)
v SUPREME SEEDS
v PADMA GROUP
v P.H.P GROUP
v T.K. GROUP
v ISPAHANI GROUP
v SA GROUP
v K.D.S GROUP
v CITY GROUP
v S. ALAM GROUP
v MEGHNA GROUP
v National Pharmaceutical Co. ltd. (NPCL)

4.8 Interest of loan:

RATE OF INTEREST ON DIFFERENT TYPES OF
LENDING PROGRAM
Sl. Lending Program Effective date Rate of Interest
No.
1. AGRICULTURAL LOAN: (Interest Annual
Basis)
a. Crop 01-11-2008 10%
b. Tea Production Loan 01-01-2008 11%
c. BADC Contract Growers Crop 01-11-2008 10%
d. Salt Growers 01-11-2008 10%
e. Fishery 01-11-2008 11%
f. Shrimp Culture 01-11-2008 11%
g. Flower Cultivation 01-11-2008 10%
h. Banana Cultivation 01-11-2008 10%
i. Sericulture 01-11-2008 10%
j. Pan Baraj 01-11-2008 10%
k. Goatary 01-11-2008 11%
l. Beef Fattening 01-11-2008 11%
m. Draft Animal 01-11-2008 10%
n. Milch Cow 01-11-2008 11%
o. Poultry & Duckary 01-11-2008 11%
p. Agri-equipment 01-11-2008 10%
q. Irrigation Equipment 01-11-2008 10%
r. Rice Husking 01-11-2008 10%
s. Sea Fishing 01-11-2008 10%
t. Nursery & Horticulture 01-11-2008 10%
u. Rural Transport 01-11-2008 10%
v. Orchard 01-11-2008 10%
w. Mixed Farming 01-11-2008 10%
x. Breeding Farming 01-11-2008 11%
y. Rearing Farming 01-11-2008 11%
z. Layer/Broiler 01-11-2008 11%
aa. Betel Nut/Coconut Culture 01-11-2008 11%
ab. Rubber Cultivation 01-11-2008 11%
ac. Tea Development Loan 01-01-2008 11%

2. TERM LOAN ON INDUSTRY:
a. Agro-based Industries (Cottage) 01-07-2007 12%
b. Agro-based Industries (Small Industries) 01-07-2007 12.50%
c. Import Substitute Agro-based Industries 01-07-2007 12.50%
d. Export Oriented Industries 01-07-2007 12.50%
e. Fish, Poultry, Goatary, Feed Mill Hatchery 01-07-2007 12.50%
3. MEDIUM & LARGE INDUSTRY 01-07-2007 12.50%
4. Working Capital:
a. Working Capital/Cash Credit 01-07-2007 13%
b. C.C. Loan for Tea Production 01-01-2008 11%
c. Cash Credit 100% Export Oriented Project 01-07-2007 8%
5. EXPORT CREDIT:
a. Frozen Food & Agricultural goods based 01-07-2007 7%
Export Credit (Under L/C)
b. Pre-shipment Credit (PSC) 01-07-2007 7%
c. Packing Credit, against transport document 01-07-2007 8%
d. LTR, PAD, LIM 01-07-2007 14%
6. OTHER COMMERCIAL LOAN: 01-07-2007 13%
7. SOCIO ECONOMIC/POVERTY 01-07-2007 11%
ALLEVIATION PROGRAMS:
Data source: Yearly loan schedule of BKB-2014.

CHAPTER -5
LOAN DISBURSEMER AND RECOVERY PROCEDURE S OF BKB

CHAPTER-5
5.1 Loan disbursemer and recovery Procedures of BKB
Bangladesh krishi bank performs all types of banking activities various section and achieve and
full fill its objective (especially Agriculture and SME sector development) economic development
as well as to strengthen its position.
Disbursement:
The act of paying out or disbursing money. Disbursements can include money paid out to
run a business, spending cash , dividend payments ,and/or the amount that a lower might
have to pay out a person s behalf in connection with a transaction.
Recovery:
The term recovery refers to collection of amount due. Normally recovery depends on the
purpose time and condition, business running process etc. loan amount will be recovered on
instalment basis. the manager can fix instalment period on the basis of nature of their business.
Image loan process:
Image 1: loan process

5.2 BKBs Credit Disbursement Program:
1. Short term loan: Bangladesh Krishi Bank provides such loan to all sorts of people, especially the
poor and marginal farmer as well as low income people for the very short term basis. The
duration of this loans are 1 to 18 months. Such loans are Crop loan, Continuous loan, Fishery
loan.
2. Medium term Loan: BKB provides such loan for the period of 18 months to 5 years.
3. Long term Loan: This loan is provided for the period of 5 to 10 years.
Short term Agricultural loan:
loans having maturity less than one year falls under this category. The loan items under this
category are:
1. General short term loan.

2. Special lending activities of 100 crore Taka.
3. Loan in the disastrous region.
4. Lending activities with Bangladesh Mission.
5. Lending activities for the process and marketing of agricultural products.
Midterm Agricultural loan: this loan facility is extended for loans having maturity more than
one year but less than three years.
The loan under this category are:
1. Mid-term general loan activities.

2. Mid term Loan in the disastrous region.
3. I.D.B.I loan 1&2.
4. A.D.B loan 1&2.
5. USAID IRI cultivation program.
6. Ret culture.
Long term Agricultural loan: Tenure of long term loans is more than three years. The loans
under this types are:
1. A.D.B loan 1&2.

2. USAID IRI cultivation program.
3. Japan assistance.
4. Improvement of tea sector.
5. Ret culture.

5.3 Process of Agricultural credit:
Institutional agricultural credit is provided to the Farmers who have agricultural land. A landless
or marginal farmer may also have agricultural credit but that required a grantor who has
agricultural land or socially bona fide person.
1. Application: refers to the initial point of entry for getting agricultural credit. Application or
prescribed form has filled by applicant.
2. Processing: refers to the work of the Bank official for assessing and verifying the
application content and recommended for sanction of fixed amount of agricultural loan
(norms set by Bangladesh Bank).
3. Sanction and disbursement: refers to the giving funds to the farmers for agricultural
production.
4. Re payment of the loan: After harvesting and selling of crops or food grains farmers have
to return loan amount with interest (at present 10%, simple rate).
Now a days revolving credit of agricultural credit is introduced by the Bangladesh bank on
selected area as experimental basis in some areas in Bangladesh. It is getting popularity in the
country.
5.4 Pre requisite condition before and after sanction a Loan:
There are several types of loans and advances in the banking operation and each has separate
pre-requisite condition. Here mention some general pre requisite condition for all loans and
advances:
Receive all documents very carefully.

Closely monitor loans holders repayment ability.
Analyze line holders business, goodwill, character, etc.
Strictly assigning security and mortgage assets.
Ensure that have to follow rules and regulations of Bangladesh Bank and head office
about loans and advances.
Make survey report by the authorized surveyor against loans mortgage and security.
Before issues second disbursement ensures that first disbursement money is utilize
properly.
Duly visit project/ plant/ business or other properties.

Review, supervision and control of loan and advances:
Review, supervision and control of advances are necessary in order to ensure safety and
advances and keep the same regular. Bank do not lend its own money, bank lend the
depositors money. So, safety of advances is very important. Supervision and control
advances are exercised in different levels (Branch/ region /area /head office) from the time
of disbursement to the time of Final recovery/ adjustment.
5.5 Documents for Loans and Advances:
1. All kinds of papers necessary for opening an A/C.

2. Charge documents.
3. Promissory note.
4. Letter of guarantee
5. Declaration
6. Letter of continuity.
Application & agreement for confirmed irrevocable without Recourse to drawers Letter of
Credit.
5.6 MANAGEMENT:
Loan management is the process for controlling and collecting payments from your customers.
A good loan management system will help you reduce the amount of capital tide up with debtors
(people who owe you money) and minimize your exposure to bad debts.
Good loan management is vital to cash flow. It is possible to be profitable on paper and but lack
the cash to continue operating in business.
LOAN MANAGEMENT POLICY:
Loan management policies help the loan department operate more efficiently. Loan
management policies are rural & guidelines established by top management that govern the
companys loan department and its performance in the extension of loan privileges. Loan
procedures are employed to achieve the goals of loan management policies.

5.7 TYPES OF LOAN MANAGEMENT:
Loan management policies allow the loan department to operate more efficiently. Ambiguity is
reduced over how to proceed when policies are clearly-defined. Loan management policies can
offer specifies rules in regard to the loan amounts, type of customers, debt-to-income ratio,
collateral requirement, payment terms and interest rates.
Types:
There are several types of loan management policies. They are based on the industry, lending
activities and top managements business style or approach to lending. Automotive, academic,
home, retail, wholesale and credit card lending all may have different loan management
policies. A tight loan management policy to conservative and restrictive guidelines for the
extension of credit. A loose policy allows for more flexibility and may focus more on simply
making sure debt is repaid instead of credit analysis and review.
Procedures:
Loan procedures are the specific ways in which top management requires the loan
department to achieve loan management policies. They can include instructions on what
data is to be used for the loan investigation and analysis process and other procedures.
Loan procedures can also provide information for the loan approval process, account
suspension and instances requiring management notification.
Cash Flow:
A major influence on loan management policies is cash flow. Cash flow requirements describe
the amount of money a business needs to meet its financial obligations or pay its bills. A loose
loan policy in which little customer loan investigation is performed can lead to higher default
rates and slower repayment of debt. This can have a significant impact on a companys cash
flow. Companies with small cash reserves or other sources of capital may be inclined to adopt
tighter loan management policies.
Communication:
Part of a good loan management policy should stress communication with other departments.
Communication with the sales department can reduce conflict sometimes occurs when a sale is
declined or affected because the loan department determines there is high level of risk involved in
doing business with a particular customer. Communication with the collections department can
provide warning signs of loan or credit default.
Guidelines:
The purpose of this document is to provide directional guidelines that will improve the risk
management culture, establish minimum standards for segregation of duties and
responsibilities, and assist in the ongoing improvement of BKB.
The guidelines have been organized into the followings:
Policy guidelines:
Lending Guidelines.
Credit Assessment & Risk Grading.
Approval Authority.
Segregation of Duties.
Internal Audit.
5.8 Management structure & responsibility:
Procedural guidelines:
Approval Process.
Credit Administration.
Credit Monitoring.
Credit Recovery.
Lending guidelines:
The lending guidelines include the following:
Industry and business segment focus.

Types of loan facilities.
Single borrowers/group limits/syndication.
Lending caps.

Loan assessment & risk grading:
Loan applications should summarize the result of the risk assessment & include, as a minimum,
the following details:
Environment or social risk inputs.

Amount and type of loan (s) proposed.
Purpose of loans.
Loan structure (Tenor, Covenants, Repayment schedule, Interest).
Security arrangements.
Any other risks or issue.
Risk triggers & action plan-condition prudent, etc.
4-2.9Approval Authority:
Loan approval authority has been delegated to Branch Manager, loan Committee by the
MD/Board.
Delegated approval authorities shall be reviewed annually by MD/Board.
Approvals must be evidenced in writing. Approval records must be kept on file with the
loan application.
The aggregate exposure to any borrower or borrowing group must be used to determine
the approval authority required.
Any loan proposal that does not comply with lending guidelines, regardless of amount,
should be referred to Head Office for Approval.

Segregation of Duties:
Bank will aim at segregating the following lending function:
Loan approval/Risk management.

Relationship management/marketing.
Loan administration
5.10 Loan recovery procedure:
With the objective of reducing classified loans and preventing further classification a number of
strategies and techniques have adopted by the bank. These include:
Reduction of classified loans in each branch to an acceptable level and for this purpose,
in each accounting year classified loan of the previous year to be reduced by 5 percent.
Identification of loan accounts as would be classified (which will become classified after
30 June, each year if they are not recovered on or before 30 June) and all out efforts to
be under taken to recover them.
Preparation of the list of the would-be-classified (WCL) and classified loan accounts to
be completed at the beginning of the year.
Taking various steps at the beginning of the year to achieve recovery targets of classified
and WCL loans. Such steps include arrangement of Shuvo halkhata, Modhu Mela,
Nobanno Mela, Maha Camp etc.
It is the duty of the bank to recover the landed fund within the stipulated time and if the borrower
fails to repay the money within the said period bank will declare him/her as a defaulter and
recover the fund by selling the securities given by the borrower or by freezing his her account or
make a suit against him or her.
Strategies for recovery
Recovery of loan can be made in the following 3 method
1 persuasive
2 voluntarily
3 legally
4 Others

1 persuasive
If the borrower didnt paid the due amount of loan in time then the first step of bank is private
communication with him.it create a mental pressure on borrower to repay the loan amount. In this
case bank can provide some advice to the borrower for repaying the loan.
2 voluntarily
Building task force

Arranging seminar
Loan rescheduling policy
Waiver of interest rate
3 legal recovery
Reminder to the bank

Creating social pressure for the payment of loan and advance
Providing legal notice
Execution of legal rules by the help of court
4 Others
Visit borrower office

Remind indirect by phone call
Invite to borrower for cup
Loan facilities, principals, procedures and lending guidelines should provide a clear and
consistent point of reference for all employees and prevent misunderstanding, confusion or
omission by personal dealing with loan issues. Additionally, loan policies help prevent
deviation from the overall lending principles and loan culture.

5.11 LOAN-PRICING METHOD:
In pricing a business loan, Bank management must consider the cost of raising loan able funds
and the operating costs of running the Bank. This means that Banks must know what their costs
are in order to consistently make profitable, correctly priced loans of any type. There is no
substitute for a well-designed management information system when it comes to pricing loans.
The BKB is generally used the simplest loan-pricing model which assumes that the rate of
interest charged on any loan includes four components: (1) the cost to the Bank of raising
adequate funds to lend, (2) the Banks non-funding operating costs (including wages and
salaries of loan personnel and the cost of materials and physical facilities used in granting and
administering a loan), (3) necessary compensation paid to the Bank for the degree of default
risk inherent in a loan request, (4) Banks desired profit margin.
These sector-wise interest rates have been introduced by the Head Office of the BKB. They use
cost-plus pricing method in case of pricing the loans. The fourteen branches of the Trust Bank
Limited have maintained these rates strictly except in case of some quality and credit-worthy
lenders. After judging the lenders credit-worthiness, the BKB gives some beneficiary to this kind
of lenders. They can enjoy a decreasing interest rate, which maintained by the BKB branches
internally. Other wise, the scheduled rates are maintained by all the BKB branches. In case of
Micro Credit, as the loan amount is not so large thats why the scheduled rate is maintained by
the Bank. Actually, the Lending rate is based on the prescription, which is given by Bangladesh
Bank.
The recovery performance of the bank was not so good during the period 1999-2002. The
credit administration and monitoring of this bank was inexperienced. This bank is monitoring
and all the loans are sanction by the high authority whose are high officials of Bangladesh
Army. This Bank has a common thinking that the people who taking loan from this bank
always think that this is an army bank so if I failed to pay then it will be a very big problem
for me. But this thinking did not work properly. Thats why the management has to think
about a well-designed Recovery Policy.

Chapter - 6
DATA ANALYSIS AND FINDING
65 Loan disbursement and recovery system | Bangladesh

Krishi Bank
CHAPTER-6
Data analysis and findings
6.1 Loan Disbursement and growth rate of Bangladesh Krishi Bank Last
5 years: Table 1: Growth of sector wise loan
(Taka in Crore)
Disbursement sector
Loan Disbursement
Sector FY 2008-09 FY 2009-10 FY 2010-11 FY 2011-12 FY 2012-13
Crop 1254.76 1406.51 1431.48 1452.78 1478.75

Growth 12.09% 1.78% 1.49% 1.79%
Fishery 160.74 207.73 282.85 294.97 297.48
Growth 29.23% 36.16% 4.28% 0.85%
Livestock 190.54 202.98 226.3 289.47 301.14
Growth 6.53% 11.49% 27.91% 4.03%
Farm 21.45 31.76 28.74 19.92 34.52
Machineries
Growth -9.51% -30.69% 73.29%
Agro-based 376.88 468.88 181.45 202.78 489.07
Industries
Growth 24.41% -61.30% 11.76% 141.18%
Working Capital 724.74 707.43 948.83 697.21 989.45
Growth -2.39% 34.12% -26.52% 41.92%
Socio-economic 57.02 54.51 53.43 48.13 62.55
Growth -4.40% -1.98% -9.92% 29.96%
Other 254.55 133.99 288.48 306.41 327.41
Growth -47.36% 6.22% 6.85%
Data source: BKB Yearly Journal.

1600
6.2 Loan disbursement in agriculture 1400
1200
sector Taka in Crore
1000
800
600
400
200
FY08-09
FY09-10
FY10-11
FY11-12
Graph -1: Loan disbursement in agriculture sector
FY12-13

6.3Growth rate last four years
Percentage:
250.00%
6.85%
2.63
200.00%
150.00%
141.18 FY11-
% 12
100.00% FY10-
11
0.85%
36.16%
41.92 FY09-
50.00% 4.03% % 102
29.23 24.41 34.12 FY08-
% 0 % % 29.96 09
1.279%.09%8% 11.49% % 29.96%
-
6.53%
0.00% 2.39% 4 4
-
- 1.40%9
9.51% 8 -1.40%98
- -
-50.00% -47.36%
-100.00%
Graph- Growth rate last four years

6.5 Financial Analysis
A coin has two sides. Though the BKB development in the past few years is highly witnessed,
during the last five years, BKB witnessed sharp increase in crop loan. They amounted to 44% in
2013, which brought BKB close to its declared planned strategy aimed at poverty alleviation. In
this section I tried to analyze the effectiveness of BKB in sector wise and regional agricultural
financing. Sector wise loan analysis-
Disbursement of Crop loan
Our most of the farmers are poor. They need credit assistant for harvesting seasonal crop.
Hence BKB gives large amount of crop loan to farmer. The crop loan disbursement is increased
18% over the five year. From the above table: 1 and graph: 1, it is seen that loan disbursement
in crop sector of BKB was increased year to year. In 2009 it was Tk 1254.74 crore and after 5
year it was Tk. 1448.75 crore that was increased. Now a days, people are more conscious
about agriculture and they want to produce more crops to become independent in food. Govt.
also tries to ensure food for his people. So, we find the increase of loan disbursement in crop
sector.
Growth of Crop loan:
Table: 1 shows the growth of crop loan. BKBs crop loan growth was 12.09% on 2009. The bank
had increased crop loan up to the end of 2013, which indicates a growth rate of 1.79% for BKB.
It is BKBs motto to ensure the growth of quality crop loan.
Disbursement of Fishery loan:
Table: 1 and graph: 1 show that loan disbursement in Fishery was increased year to year. It was
significantly increased from 2009 to 2011 and after 5 year it was Tk 297.48 crore. Fish is a very
necessary item for us. It is also very profitable business. Specially, the unemployed are
motivated and trained by the govt. about fishing. That is why, loan disbursement in Fishery was
increased.
Growth of Fishery loan:
Table: 1 shows the growth of fishery loan. During 2009 to 2013 every year fishery loan of BKB
had increased from the previous year. The highest growth of fishery loan of BKB was observed
in 2011 that was 36.16%.
Disbursement of live stock loan:
From the above table: 1 and graph: 1, it is seen that loan disbursement in livestock sector of
BKB was increased year to year. In 2009 it was Tk 190.54 crore and after 5 year it was Tk.
301.14 crore that was increased. Live stock is also profitable and potential sector for the
unemployed. So, loan in this sector increased.
Growth of live stock loan:
It is observed from the table: 1 that during 2009 to 2013 every year live stock loan of BKB increased
from the previous year except in 2013. The highest growth was observed in 2012.
Disbursement of farm machineries loan:

henneries sector of BKB was increased in 2010 from 2009. But it was decreased in 2011 and
2012. After that it was increased in 2013.

Growth of farm machineries loan:
Table: 1 shows the growth of loan allocation for farm machineries sector. Loan allocation for
farm machineries by BKB was increased from the previous year in 2010 and 2013, but it was
decreased from the previous year during 2011 to 2012.
Disbursement of agro based industries loan:
From the above table: 1 and graph: 1, it is seen that loan disbursement in agro based industries
sector of BKB was increased in 2010 from 2009. But it was decreased in 2011. After that it was
increased in 2012 and 2013.
Growth of agro based industries loan:
Table: 1 shows the growth of loans allocation for agro based industry. BKB had allocated the
loan into two sectors, Large and Medium Industry and Small and Cottage Industry. BKB had
sanctioned the maximum amount of loan in the year 2013 and the growth was 141.18%.
Disbursement of working capital loan:
Loan disbursement in working capital sector of BKB was slightly decreased in 2010 from 2009.
But it was increased in 2011 and decreased in 2012. After that it was increased in 2013. It
appears in table 1 and graph 1.
Growth of working capital loan:
Table: 1 shows the growth of loan allocation for working capital. In 2011 and 2013 the amount of
loan disbursement by BKB for working capital had been increased from the previous year that
was 34.12% and 41.92% respectively.
Disbursement of socio economic activities loan:
Result from the above table: 1 and graph: 1 show that loan disbursement in socio economic
activities sector of BKB was decreased in 2010, 2011 and 2012 from 2009. But it was increased
7% in 2013 from the past five year.
Growth of socio economic activities loan:
Table: 1 shows the growth of loan allocation for socio economic activities sector. During 2009 to
2012 the loan disbursement by BKB had been decreased from the previous year. The highest
growth of the loan was 29.96% observed in 2013.

Disbursement of other loan:
From the table: 1 and graph: 1, it is seen that loan disbursement in others sector of BKB was
decreased in 2010 from 2009. After that it was increased in every year up to in 2013.
Growth of other loan:
It is observed from the table: 1 that during 2009 to 2013 every year other loan of BKB increased
from the previous year except in 2010. The highest growth was 115.30% observed in 2011.
6.6 Agriculture loan disbursement and recovery from BKB sylhet corporate
FY2011-2012:
Table-2
Taka in Thousand:
Agriculture loan: FY2011-12 Recovery 11-12 Recovery rate

1 Corps 499831 45.2040 90.44%
2 Fishery 3800 2520 66.32%
3 Livestock 2700 1220 45.19%
4 Irrigation machinery - - -
5 Firm machinery 2673 1352 50.58%
6 Corps warehousing 1500 1070 71.33%
7 Socio Economic Development - - -
Activities
8 Others: - - -
a.AgroIndustries 13810 8720 63.14%
b. CC loan (1) agricultural goods 5508 3407 61.85%
production
c.Others 19318 3260 16.87%
Total agriculture loan 549140 473589 86.78%
*Above table show the Agriculture loan disbursement from BKB sylhet corporate
FY2011-2012

6.7 Agriculture loan disbursement from BKB sylhet corporate FY2012-13:
Table-3
1 Corps 576030 550198 95.51%
2 Fishery 4900 2530 61.63%
3 Livestock 1000 450 45%
4 Irrigation machinery - - -
5 Firm machinery - - -
6 Corps warehousing - - -
7 Socio Economic Development - - -
Activities
8 Others: - - -
b. CC loan agricultural goods 117500 112400 95.65%
production
c.Others 30840 19212 62.29%
Total agriculture loan 857677 706593 82.38%
*Above table show the Agriculture loan disbursement from BKB sylhet corporate FY2012-13
Table-4
1 Corps 590712 732912 124.1%
2 Fishery 52400 99032 188%
3 Livestock 3300 4334 131%
4 Irrigation machinery - 1595 -
7 Socio Economic Development - 427 -
Activities
8 Others: - - -
production
c.Others 55866 10551 18.88%
Total agriculture loan 806319 912505 113%
*Above table show the Agriculture loan disbursement from BKB sylhet corporate FY2013-
14.

Table-5
Agriculture loan: FY2014-15 Recovery14-15 Recovery rate
1 Corps 547777 702376 128%
2 Fishery 37900 38551 -
3 Livestock 1000 5948 -
4 Irrigation machinery - -
7 Socio Economic Development - 296 -
Activities
8 Others: - - -
a.AgroIndustries - -
production
c.Others 7584 3900 51.42%
Total agriculture loan 602761 756071 125%
Above table show the Agriculture loan disbursement from BKB sylhet corporate FY2014-15.
6.10 Graph: 1 GRAPHICAL PRESENTATION LAST FOUR YEARS:
700000
600000
FY2014-15
500000
400000 FY2013-14
300000
FY2012-13
200000
100000
FY2011-12
0

From the above graphical presentation, it is clearly seen that loan disbursement from
bkb sylhet corporate is maximum in agriculture sector, its remain maximum last four
years,secod high disbursement in sme sector,
6.11 Graph 2 Recovery rate of agriculture loan last four years:
200%
188%
180%
160%
150.25%
140%
128% 131%
120% 124.10%
95.65
100% 95.51%103.20% %
90.44%
80% 66.49
66.32 63.14% 71.33 FY2014-
%
% % 15
60% 61.63% 56.80%58 2%
61.85%62.29%
51.42 50.58 FY2013-

40% 45%19%. % % 14
20% 17.11 8 FY2012-
% 16.88%7
13
0% 0 0% 0% 0% 0%
FY2011-
12
Recovery rate of agriculture loan is average 50-55 percent last four years. It is very low
compare with other schedule bank in Bangladesh.
6.12 SME loan disbursement
SME loan disbursement from BKB sylhet corporate branch FY2011-12:
Table-6
FY 2011-12 RECOVERY 11-12 Recovery rate
SME LOAN:
Project loan 550 - -
CC Loan 2 27415 23074 81.16%
Total SME LOAN 27965 23074 82.51%
*Above table show the SME loan disbursement of BKB sylhet corporate branch in FY 2011-12.
SME loan disbursement from BKB sylhet corporate branch FY 2012-13:
Table-7
FY 2012-13 RECOVERY 12-13 Recovery rate
SME LOAN:
Project loan 743310 25000 3.37%
CC Loan 2 23125 20407 88.24%
Total SME LOAN 776435 45407 5.84%
Table-8
FY 2013-14 RECOVERY 13-14 Recovery

SME LOAN:
Project loan 3561 - -
CC Loan 2 29784 16501 55.40%
Total SME LOAN 33345 16501 49.48%
Table-9
FY 2014-15 RECOVERY 14-15 Recovery

SME LOAN:
Project loan 460 303 65.86%
CC Loan 2 40560 39948 98.49%
Total SME LOAN 41320 35271 85.36%
*Above table show the SME loan disbursement of BKB sylhet corporate branch in FY2014-15.

6.13 SME loan disbursement from bkb sylhet corporate:
80000
0
7
70000
0
60000
0
50000
0
40000
0
30000
0
20000
0 Project loan
10000
0 CC Loan 2
27415 23125 29784 40560
550 3561 460
0
FY201
FY2011-12 FY2012-13 FY2013-14 5
Above Graph show loan disbursement from bkb sylhet corporate last four financial years in SME sector

6.14 Recovery rate of SME loan:
180%
160%
140%
120%
100%
81.16 CC
80% % loan
2
60%
proj
ect
40% loan
20%
0% 0%
FY201112 FY2012-13
Above graph show the

recovery rate of SME loan
last four years .recovery
rate of bkb sme loan is
very poor.
6.15 Tea loan disbursement

from BKB corporate last
five years:
Table-10
Taka in crore
Tea loan: FY-2012 FY-2013 FY-2014 FY-2015

Short term 49.56 83.69 52.95 78.34
Recovery 64.84 79.75 51.70 78.26
Recovery rate 130.83% 83.89% 97.63% 100.10%

Long term 3.09 2.20 1.03 1.46
Recovery 2.88 4.04 6.59 2.20
Recovery rate - - - -
*Above table show the TEA

loan disbursement of BKB
sylhet corporate branch in FY
-12.13,14,15.
77 Loan
disbursement and
recovery system |
Bangladesh Krishi
Bank
6.16 Tea loan
disbursement from
BKB corporate last five
years:
90
83.69
80
70
60 Sh
ort
49.56 ter
50 m
40
Lo
30 ng
ter
20 m
10
3.09
0
FY-2012 FY-2013
Above graph show the tea

loan disbursement of bkb
sylhet corporate branch last
four years.
6.17 Recovery rate of tea

loan last five years:
140.00
%
130.83%
120.00
%
100.00
% 97.63% 100.10%
83.89%
80.00%
Tea loan short
term
Tea loan long
60.00% term
40.00%
20.00%
0.00% 0 0 0
FY2012
FY2013
FY2014
FY2015
Above graph show that short

term tea loan disbursement
from bkb sylhet corporate in
2012 (49.56 crore) 2013
(83.69crore) 2014 (52.95 crore)
2015 (78.34 crore)and maximum
disbursement in 2013.
78 Loan disbursement
and recovery system |
6.18 Loan disbursement of BKB corporate sylhet compare with other banks:
Table-11 Taka in million
Bank name Loan disbursement Recovery rate Comment

FY2013-14
BKB sylhet corporate 629.55 46% Very poor
Branch,sylhet
Sunali bank ltd. 2162.30 96.95% Good
Dargagate corporate
Branch,sylhet
Pubali Bank LTD.sylhet 170.24 51.74% Very poor
Branch,sylhet
*Data from concern branch
6.19 Loan disbursement and recovery among three banks:
46% 96.95%
100%
51.74%
100%
2162.3
629.55
Recovery rate
100%
Loan disbursement FY2013-14
170.24
99%
Sunali bank
BKB sylhet ltd. Pubali Bank
corporate Dargagate LTD.sylhet
Branch,sylh Branch,sylh
et corporate et
Branch,sylhet
Above Table and graph show the loan disbursement and recovery rate of three schedule bank of
Bangladesh, it represent that the loan recovery rate of sunali bank is good compare with other two
banks. the loan recovery rate of bkb sylhet corporate is very poor compare with other two bank.

6.20 Findings
From the analysis it is reflected that BKB had experienced a negative growth for deposits. The
deposit base of BKB has to improve. It indicates the banks will not be able to attract more
deposit in the future years. It is a negative sign that the bank has not increased the deposit
interest rate significantly. From the analysis it is expected that the banks will continue to
increase the deposit interest rate in the future as well. It will encourage small savers to save
more and allocate their saving in the overall improvement of the country.
Findings about Loan Disbursement:
I have found that BKB has increased its loan disbursement gradually throughout the years.
From the trend analysis we have seen that the trend values for loan of both the bank is positive
which indicates that the bank will increase the amount of loan disbursement in future. But the
loan interest rate shows a increasing pattern which will discourage small and medium
entrepreneurs to take loans from the bank. However, the bank should focus more on this issue
regarding reducing the loan interest rate even more. It is observed that BKB does not sanction
adequate loan in large and medium agro based industry. So, BKB should give attention for large
and medium industry more and may allocate more loans in this sector. At the same time bank
should focus more on small and cottage industry. This is an important sector which helps many
landless and unemployed people to become self dependant and thereby earn their livelihood.
So, adequate loan disbursement with easy formalities by the banks in this sector is a must.
However, in a country like Bangladesh, where about 40% population lives under the poverty line
and reducing loan for poverty alleviation is even more harmful. The banks should make easy
formalities for loan disbursement for this purpose; so that poor people can improve their
financial condition by taking loan. BKB is allocating less than 1% loan in small and cottage
industry, which is alarming. Bank should focus more in this sector. They should also focus more
attention for poverty alleviation without which it is impossible to think about the proper
development of the economy.
Findings about Recovery:
Both banks should concentrate more on loan recovery. It is reflected from the analysis that there
is no consistent pattern for agricultural loan disbursement and recovery. However, the scenario
is relatively better for industrial loan disbursement and recovery. It is recommended that the
banks should disburse loan for easy condition and should set a target for loan recovery in both
the sectors. It is always better if the bank can recover loan at a consistent pattern in every year.
Otherwise the banks profitability can be hampered.

Findings about Data analysis:
1.Banks loan disbursement amount is higher then the loan recovery amount of every sector.
2.Bank disbursement loan again and again to the sector which s recovery amount is low but
giving small amount to the sector which loan recovery is high.
3.Some times bank authority give loan with know about the background of the customer or who
has no proper granter of the loan and also there is lack of loan supervision.
4. Sometimes bank is influenced by the higher authority to give loans. the influential person due
to their political and social power are not interested to repay the loan. because of their political
influence. credit officer cannot take any effective measure for loan recovery from them.
sometimes, loan received by them for a specific purpose is also diverted to other purposes.
5.Bank sometimes does not follow the Bangladesh bank circular properly and face recovery
problems.
6. Bank sometimes does not judge the financial condition of a customer and give loan if the
customer is their friend or relatives.
7. Banks officer face misbehaviour of the borrower on visit of the officer to adjust the loan.
8. Sometimes bank is facing unwilling behaviour of the borrower to adjust the loan and misbehave.
9.Banks sometimes try to contact with the customer but they cleverly avoid to adjust with the
bank.
10.Sometimes banks taken mortgage of loan against loan. which value is low then the mention
price is the paper of loan, so bank face trouble when the loan owner failed to recover the loan
and bank the to sell the land because of low price.
11. Bank has some corrupted employees who give loan without checking the clients background
and gives loan only for bribe. some employee has loss their jobs for those corrupted behaviours.
12. Sometimes the borrower fails to repay his loan officer face problems for the default of loan.
13. Sometimes, the farmer have some valid reason for non repayment of loan in spites of their
willingness of repayment of loan. In the case of crop failure due to natural disaster like food,
drought, etc. it becomes really difficult for the farmers to repay loan in time.
14. Lack of legal action by the banks against defaulters-neither the bank manager nor the
supervisor has any authority and power to take effective measure or administrative action
against defaulter. For the reason , the defaulter do not bother for request of loan repayment by
them . Moreover, legal action against defaulter has rarely been taken.

Other findings:
The product diversification of the bank is very narrow. The promotional activities of the Bank are
not adequate to widen its function. The Branches of the bank have to depend on its Head office
for decisions. The bank does not provide online banking service and ATM service, which limits
its competence in the fast changing banking sector.
6.21 Why Recovery takes so much time:
Only because of existing rules and regulation recovery is a time consuming procedure. I think
an example will make this thing clear. Let, Mr. X took loan from Y bank by giving a land as
registered mortgage and become bad. Now bank cannot sell the land without the permission of
court though the land was as registered mortgage to bank. So bank has to sue against Mr. X
and court send notice to Mr. X. But Mr. X can delay his coming by saying he is sick and asking
for more time. Court gives new date to settle the matter. Then on new date a person came to
the court saying that he is the brother of the client and the land is their fathers property. And
most importantly, client didnt notify him before give the land to the bank. So court asks him to
prove his claim. Finally, if court gives injunction in favor of bank, they face problem to sell the
land. Because client put mussel-men protect the land from bank. Moreover people are not
interested buy land on occasion from court. Finally the interesting thing is most of the time the
same client but the land in another name. Otherwise, govt. institute cant recruit manpower
without maintaining bureau crating procedure. So, normally manpower shortage occurs and it is
a vital cause for delay of recovery.

CHAPTER -7
RECOMMENDATION S AND CONCLUSION
83 Loan disbursement and recovery system | Bangladesh Krishi

Bank
CHAPTER-7
7.1 Recommendation s and conclusion:
Bangladesh Krishi Bank has established itself as premier and efficient one in innovating new
financial products and service and in grabbing the market in which it operating. Banking is a
service oriented marketing, its business profits depends on its service, quality. That is why the
authority always should be aware about their service quality in order to get competitive
advantage and to deliver quality and to be more fruitful to our economy.
v 1.The bank should try to recover more for the adjustment of their loan disbursement is
high and loan recovery is low and also find out their lacking and restructure their
investment planning.
v 2.Bank should disbursement loan in the sector which loan recovery amount is higher
then the other every sector.
v 3.Bank should arrange proper training for their employees so that the can properly do
their job and supervise the loan.
v The bank should not influence by higher authority and should ethically judge the
situation.
v Bank should follow the Bangladesh bank circular properly and strictly apply them in
practical use.
v Bank should not inflated by personal connection and follow the proper way to gives loan
to their customer. Bank can arrange seminar for the proper use of disbursement process
and ethically influenced their employee to do their right things.
v Bank can arrange camp in various are as for the recovery of his loan, in this issue the
manager and other officer were present in the camp and communicated with borrowers.
The give them moral persuasion and tried to encourage theb, so that the could repay
their loan.
v The banks follow constant for adjusting the loan. Frequently visit to the customer and
also regularly monitoring his business condition. But if the borrower does not repay their
respective loans and interest after maturity being received the demanded notice under
registered with acknowledgement by post to the borrowers the bank should send lower
notice to him.

v If the borrower fails to repay his loan instalment the loan officer communicates with the
respective person of that area to give mental pressure to the borrower so that he repay
his respective loan.
v Bank should check the land in person before mortgage and find out thereal value of the
land so that is future will not face any trouble.
v Bank should eliminate the corrupted employees and also can supervise by a committee
to keep eyes on their employees. The bank also can take strict and legal steps against
those employees.
v Bank can help poor farmer giving again a loan, so that he can repay all amount of the
loan in future.
v Bank should take proper legal step against the loan defaulter.
v The analysis suggests that the agriculture credit in crop sector has a positive and
statistically significant impact on agriculture output and its effects is immediate. BKB
gives crop loan 45% of credit portfolio. It should increase up to 50%.
v Agro based industries finance also has a positive significant impact on agriculture
output, but with a long period. Hence BKB have to conscious for financing properly.
v BKB is allocating 1% loan in farm machineries, which is alarming. The bank should focus
more in this sector. It should also focus more attention for poverty alleviation without
which it is impossible to think about the proper development of the economy.
v The role of BKB can be further enhanced by much greater financial inclusion by
involving of all especially self-help groups.
v Gradually the Bank is improving its Position. The volume of financing in agriculture and
agro based products is increasing rapidly and a good response is getting from the clients
in different scheme.
v Bangladesh Krishi Bank is the largest specialized bank in our country. Therefore, it must
think seriously to adopt ON LINE banking. Data base networking is one of the most
recent technologies to transfer from branch to branch or from branch to head office and
vise-versa.
v Modern technical equipment such as computer is not sufficient in branch banking

operation and manual banking also makes the process complicated. Therefore, the
branches should be computerized so that the client can get better service as quickly. It is
quite evident that to build up an effective and efficient banking system to the highest
desired level, computerized transaction is a must.
v The bank should try to arrange more training programs for their officials. Quality training
will help the officials to enrich them with more recent knowledge of banking. To provide
quality service to the customer it is necessary to have trained team of staff Bank should
introduce more promotional program

7.2 Conclusion:
In general it can be concluded that the agricultural loans in Bangladesh are easily noticeable,
they contribute to the economy in terms of goods and services ; creation of employment
opportunities at relatively low capital cost; reducing income disparities; develop a pool of skilled
and semiskilled peasants as a basis for the future industrial expansion; it improves forward and
backward linkages between economically, socially and geographically diverse sector of
economy; it provides opportunities for developing and adapting appropriate technological
approaches, which is often a great to the progressive economic development. These results
reveal that even though there are several gaps in the present institutional credit delivery system
like inadequate provision of credit to small and marginal farmers, paucity of medium and long
term financing and limited deposit mobilization and heavy dependence on borrowed funds by
major agricultural credit purveyors, agriculture credit is still playing a critical role in supporting
agriculture production in Bangladesh. I am quite optimistic that if the given suggestions of this
paper are implemented then the agricultural banks may be able to overcome its present
problems and may contribute in the rapid development of the agricultural sector of Bangladesh.
7.3 Reference :
[Online]Available: http://en.wikipedia.org/wiki/Agriculture_in_Bangladesh
[Online]Available:http://www.adb.org/gender/practices/agriculture/ban004.asp
[Online] Available: http://www.krishibank.org.bd/
[Online] Available: http://www.rakub.org.bd/
http://www.investopedia.com.
www.krishibank.org.bd
www.google .com
Information From Office Documents.
Agriculture & Rural Credit Policy and Program me for the FY 2014-2015.
Manual of General Banking published by BKB.

88

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Letter of Transmittal

I have tried my level best to follow the guidelines

1 Loan disbursement and recovery system | Bangladesh Krishi Bank

I would like to take opportunity to express my humble gratitude to my honorable teacher

2 Loan disbursement and recovery system | Bangladesh Krishi Bank

Subject: Submission of Report on The loan disbursement and recovery

This is to certify that A. F. M Shahidul Islam is a student of MBA program under

3 Loan disbursement and recovery system | Bangladesh Krishi Bank

Chapter Particulars Page no.

Chapter -2 2.1Organizational overview

2.3 Mission of Bangladesh Krishi Bank

2.5 Features of BKB

6 Loan disbursement and recovery system | Bangladesh Krishi Bank

3.8 Categories of Lending of Money

3.9 Purposes of taking Loan

3.13 Steps for Loan Recovery

4.6 Staff loan:

4.7 Corporate financing

4.8 Interest of loan

5.4 Pre requisite condition before and after sanction a Loan

5.11 Loan-pricing method

6.3 Growth rate last four years

6.7 Agriculture loan disbursement from BKB sylhet

6.13 Recovery rate of SME loan

6.17Loan disbursement of BKB corporate sylhet

8 Loan disbursement and recovery system | Bangladesh Krishi

9 Loan disbursement and recovery system |

10 Loan disbursement and recovery system |

11 Loan disbursement and recovery system | Bangladesh Krishi Bank

1.3 Significance of the Report:

1.4 Scope of the report:

1.5 Objective of the report:

12 Loan disbursement and recovery system | Bangladesh Krishi Bank

The primary objective of the report are as follows:

More specifically, this study entails the following aspects:

1.6 Methodology of the report:

13 Loan disbursement and recovery system | Bangladesh Krishi Bank

Official record of BKB.

Officials files and folders.

1.7 Rational of the report:

Have an idea about the banking sector of Bangladesh.

1.8 Tools and techniques used:

14 Loan disbursement and recovery system | Bangladesh Krishi Bank

v Some limitations of the report are:

15 Loan disbursement and recovery system | Bangladesh Krishi Bank

16 Loan disbursement and recovery system | Bangladesh Krishi Bank

17 Loan disbursement and recovery system | Bangladesh Krishi Bank

01 Name of the Bank Bangladesh Krishi Bank

02 Logo of the Bank

03 Date of Incorporation June 02, 1973

04 Inauguration of First Branch August 01, 1975

06 Bangladesh Bank Permission No *************

09 CEO & Managing Director

11 Number of Branches 1026

14 Authorized Capital Taka 15,000 Million

15 Paid-up Capital Taka 9,000 Million

16 Corporate Head Office Krishi Bank Bhaban, 83-85 Motijheel

18 Credit Rating Long Term (Adequate Safety)

Table 3.1: Bangladesh Krishi Bank at a Glance

18 Loan disbursement and recovery system | Bangladesh Krishi Bank

2.3 Mission of Bangladesh Krishi Bank:

v To be the most caring, customer friendly and service government bank.

19 Loan disbursement and recovery system | Bangladesh Krishi Bank