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Internship Report on

Performance Evaluation of Al-Arafah Islami Bank Limited.

PREFACE
After completion our BBA final examination, Internship Program is an important part
for our post graduation degree. For this reason, I perused my Internship Program in AlArafah Islami Bank of Limited, Khilkhet Branch, from 22 th May to 22th Aug 2012. The
duration of the program was three months. Like other employees of Al-Arafah Islami
Bank Limited, I worked there at regular basis aiming to acquire practical knowledge
which will help me in my practical life. In three months, I tried with my best ability to
learn about the instructions, characteristics, natures, functions, competitiveness,
workflows etc. of banking system. AIBL is one of the leading Islami bank in the
country as a banking position. With the banking functions, it is very much huge and
complex.
I tried to understand these complex and huge characteristics, nature, functions etc.
However, I tried my best to blend with these situations and realized most of these
things. In a short time, it is impossible to learn all things.
In the duration of nine weeks, I also tried to gather all the information and knowledge
from different text books, brochures to understand the difficult task of bank. In this
report, I have presented those in proper, chronological and precise way.
At the end, I can only state that by this Internship Program I am able to complete the
hard working BBA course in The University of Asia Pacific. I found all sorts of cooperation and good work environment in three months working with Al-Arafah Islami
Bank Ltd. Everybody concerned with management and administration of the bank was
compassionate to me.

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Internship Report on

Performance Evaluation of Al-Arafah Islami Bank Limited.

Acknowledgement
A lot of concentration, effort, responsibility and study have been involved in preparing
this paper into reality. In preparing a report one needs a number assistance and guidance
from reliable sources. This report also stands on the basis of such efforts. I have
pleasure to express my gratitude to the internship and placement committee for
arranging such a program from which I have carried a lot of practical experience. At the
very outset, I would like to express my profound respect to my honorable teacher
Shanewaz Mostofa , who is my supervisor, of Internship Program designed for the BBA
students. His continuous supervision has inspired me to make a more feasible report
based on in-depth analysis.
In preparing the report, I received active co-operations from the VP, Second Officer,
Officer of AIBL, Kilkhet Branch. I sincerely express my heart-felt gratitude to them for
their Co-operation, which helped me to conduct and complete this report..
However, to my best I tried very hard and worked sincerely to prepare this report an
informative one. At last, my sincere apology goes to the readers for my conceptual &
printing mistake, if there is any.

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Internship Report on

Performance Evaluation of Al-Arafah Islami Bank Limited.

EXECUTIVE SUMMARY
Islam provides us a complete lifestyle. Main objective of Islamic lifestyle is to be
successful both in our mortal and immortal life. Therefore in every aspect of our life we
should follow the doctrine of Al-Quran and lifestyle of Hazrat Muhammad (sm.) for our
supreme success. Al-Arafah Islami Bank (AIBL) started its journey in 1995 with the
said principles in mind and to introduce a modern banking system based on Al-Quran
and Sunnah.
A group if established dedicated and pious personalities of Bangladesh are the architect
and directors of the bank. Among them a noted Islamic scholar, economist, writer and
ex-bureaucrat of Bangladesh Govt. Mr. A. Z. M. Shamsul Alam is the founder chairman
of the Bank. His progressive leadership and continuous inspiration provided a boost for
the bank in getting a foothold in the financial market of Bangladesh .A group of 26
dedicated and noted Islamic Personalities of Bangladesh are the member of executive
council of the Bank. Al-Arafah Islami Bank Ltd. (AIBL) has 61 Branches and 1033
employees (as on December 2007). Its authorized capital is 2500 million Tk and paid
up capital is taka 1153 million Tk.
The report is based on three months (26 th April to 25th July 2010.) working experience
on Al-Arafah Islami Bank Limited (AIBL). I was assigned in the Khilkhet Branch,
Dhaka of AIBL. This report gives a clear idea of the activities, operation strategies and
the performance of AIBL, incorporated in 1995 and become operational with view to
provide exclusive service facilities to its client and accordingly meet the demand of
banking service all over Bangladesh. During these 13 years of its operation, the bank
had been widely acclaimed by the business community from small businesspersons to
conglomerates for forward looking outlook and innovative financial solutions.
The whole report consists of seven parts. Part two to five is based on the AIBL and the
services it provides and about Al-Arafah Islami Branch. Part three, four and five are
based on the General Banking, Foreign Exchange and Investment Division of AIBL
Khilkhet Branch respectively.

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Internship Report on

Performance Evaluation of Al-Arafah Islami Bank Limited.

Orientation of the Report

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Internship Report on

Performance Evaluation of Al-Arafah Islami Bank Limited.

1.1 BACKGROUND OF THE STUDY


Banks are the key financial institutions that play a vital role in the countrys economy.
Globalization in the banking sector has thrown up opportunities as well as challenges.
Competition is getting edge day by day. It paces with the continuous development
occurring in the tremendous competitive environment.
To keep pace with this situation, we need banking knowledge for future career. If we
want to build our career in banking area, only theoretical knowledge would not help us.
As internship program is established to gather practical knowledge regarding various
sector of economy, I chose to get practical knowledge regarding banking sector and I
select Al-Arafah Islami Bank as my organization to work.
The duration of my program was nine weeks and during this period, I have learned
many things. I observed that there is a great difference between theoretical knowledge
and practical knowledge. I learned many terms, functions and nature of banking
activities. I also get practical knowledge regarding organizational environment.

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1.2 METHODOLOGY
A sample survey was conducted to collect primary data using two pre-designed survey
instruments from concerned groups following an appropriate sample design. In view of
the complexities involved in generating quantitative data for assessing the real impact,
qualitative data were also collected using Focus Group Discussions (FGDs). In the
context of the unique features of the area an attempt was made to identify the strengths,
weaknesses, opportunities and threats of the banking sector.
Data Collection
This study is mainly based on secondary data available from the various divisions and
departments of AL-ARAFA ISLAMI BANK, in addition to these other necessary
information have been collected from the daily news papers, relevant journals, annual
reports of Al-Arafah Islami Bank Ltd, Web side and publications of other relevant
institutions have also been taken into consideration.
Primary sources of data:

Face to face conversation with the bank officers & staffs.


Conversation with the clients.
Different' manuals of Al-Arafah Islami Bank Limited.
Different circulars of Al-Arafah Islami Bank Limited.

Secondary sources of data:


Procedure manual published by the Al-Arafah Islami Bank Ltd.
Files and documents of the branch.
Annual report of Al-Arafah Islami Bank Limited, 2007
Different papers of Al-Arafah Islami Bank.
Unpublished data.
Different text books.

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1.3 OBJECTIVE OF THE STUDY


The main objective of this study is to have some practical exposures that will be helpful
for my Final year courses in the BBA Program.
To achieve the broad objective the following specific objectives has been attained:

To find out the marketing strategy of Al-Arafah Islami Bank Ltd Bank Ltd.

To find the financial performance of Al-Arafah Islami Bank Ltd Bank Ltd.

Analyzing the performance of the bank

To find out the different banking procedures of the branch.

To know the competitive strength and weakness of the bank.

To know the marketing and expansion strategy of bank that can help to face the
potential threats and opportunities.

To know the technological advantage and lacking of this bank in the modern
banking system.

To find out the relations among the various department.

To make a bridge between the theories & practical procedures of banking dayto-day operations.

To make possible recommendations for the internship organization to improve


the services & service range so that the department can cater to the needs and
demands of customers.

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1.4 SCOPE OF THE STUDY


At Al-Arafah Islami Bank Limited, I have firstly tried to acquire knowledge and
experience about the overall banking system. The report mainly focused on Overall
performance of Al-Arafah Islami Bank Limited; A study on Al-Arafah Islami Bank
Khilkhet Branch.
Here I have discussed about overall services and functions rendered by Al-Arafah
Islami Bank Limited, i.e. customer advance, remittance, clearing, cash department,
foreign exchange department & modern equipment used by the bank. Which have been
observed during the three months Internship program.
The report also finds out some possible recommendations, which might be taken or
accepted by the management of the bank.

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1.5 LIMITATIONS OF THE STUDY


Despite my sincerest endeavor in preparing a perfect report, some of the limitations are
inescapable. These are as follows:

Within such a short period of time (nine weeks), it was not possible for me to
study everything about Al-Arafah Islami Bank, Khilkhet Branch.

The officers are so much busy that they cannot properly co-operate with me,
which are a problem.

Banks policy of not disclosing some data and information for obvious
reason, which could be very much useful.

To analysis SWOT of emerging market is a wide spread survey material.


However, time constraint restricted the report to specific feature.

The study requires experience to be fruitful but it was completely absent to


me.

Sometimes the officials were reluctant to give proper information regarding


their activities because they felt hesitation and ambiguity to give data and
information.

Lack of personal knowledge and experience.

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Introduction

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2.1 INTRODUCTION
History of AL-Arafah Islami Bank (AIBL):

Islamic ideology encourages us to succeed in life here& hereafter. To achieve this


success we must follow the way dictated by the HOLY QURAN and the path
shown by Rasul (SM). With this goal in view AL Arafah Islami Bank Ltd was
established (registered) as a public limited company on 18 June 1995. The
inaugural ceremony took place on 27 September 1995. The authorized capital of
the Bank is TK.2500.00 million and the paid up capital TK.1153 million. Some
very renowned Islamic personalities and pious businessmen of the country are the
sponsors of the bank. The total paid up capital was invested locally.
The Bank is committed to contribute significantly in the national economy. It has made
a positive contribution towards the towards the socio economic development of the
country by opening 46 branches on which 16 authorized dealer (AD) throughout
the country.
The equity of the bank stood at TK.2037 million Crore as on 31 December 2007, the
manpower are 1033 and number of shareholders are 12013.
The Bank conducts its business on the principles of Musaraka, Bai-muazzal, and hire
purchase transactions approved by Bangladesh Bank. Naturally, its modes and
operations are substantially different from those of other conventional commercial
Bank. There is a Shariah council in the Banks who maintains constant vigilance to
ensure that activates of the bank is being conducted on the precepts of Islam. The
Shariah council consists of prominent Ulema, reputed, Bankers, renowned lawyers and
eminent Economist.

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2.2 Special Features of AIBL:

All activities of the bank are conducted according to Islamic Shariah where

profit is the legal alternative to interest.

The banks investment policy follows different modes approved by

Islamic Shariah based on Quran & Sunnah.

The bank is committed towards establishing welfare oriented banking

system, economic upliftment of the low-income group of people, create


employment opportunities.

According to the needs and demands of the society and the country as a

whole the bank invests money to different Halal business. The bank participates in
different activities aiming at creating jobs, implementing development projects
taken by the government and developing infrastructure.

The bank is committed to establish an economic system through social

justice and equal distribution of wealth. It is committed to bring about changes in


the underdeveloped rural areas for ensuring balanced socioeconomic development
of the country through micro credit program.

According to Mudaraba system, the depositors are the partners of the

investment income of the bank. During the period under review, 70% of the
investment income has been distributed among the Mudaraba depositors.

To render improved services to the clients imbued with Islamic spirit of

brotherhood, peace and fraternity and by developing an institutional cohesion.

The bank is contributing to economic and philanthropic activities side by

side. AIBL English Medium Madrasah and AIBL library are among mention
worthy.

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2.3 CHAIRMAN AND DIRECTORS OF Al-ARAFAH ISLAMI BANK LTD.


Jb. Badiur Rahman
Jb. S M Shameem Iqbal
Al-Hajj Nazmul Ahsan Khaled
Al-Hajj Md. Harun-ar-Rashid Khan
Al-Hajj Abdul Malek Mollah
Al-Hajj Hafez Md. Enayetullah
Jb. A N M Yeahea
Al-Hajj Abdul Moktadir
Al-Hajj Ahamedul Haque
Al-Hajj Abdus Samad
Jb. Sabrina Farah Ahmed
b. Abdus Salam
Jb. Niaz Ahmed
Jb. Md. Ashik Hossain
Jb. Mohammded Emadur Rahman
Jb. Md. Rafiqul Islam
Jb. Anwar Hossain
Dr. Momtaz Uddin Ahmed

Chairman
Vice Chairman
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director

2,4 Executive Committee of AIBL


Al-hajj Abdus Samad

Chairman

Al-hajj Abdul Malek Mollah

Co-Chairman

Al-hajj Md. Anower Hossain

Member

Al-hajj Mir Ahmed Sowdager

Member

Al-hajj Md. Harun-ar-Rashid Khan

Member

Al-hajj Nazmul Ahsan Khaled

Member

Al-hajj Hafez Md. Enayetullah

Member

Al-hajj Kazi Md.Mofizur Rahman

Member

Al-hajj Ahmedul Haque

Member

2.5 Audit Committee


Al-hajj Nazmul Ahsan Khaled

Chairman

Al-hajj Ahmed Ali

Member

Al-hajj Engr. Kh. Mesbahuddin Ahmed

Member

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2.6 MEMBERS OF SHARIAH COUNCIL


Moulana Md. Siddiqur Rahman

Chairman

Moulana Abu Sayeed Mohammad Omar Ali

Member

Mufti Moinul Islam

Member

Alhajj Md. Anwar Hossain

Member

Alhajj A J M Shamsul Alam

Member

Md. Abdur Rahim Khan

Secretary (Acting)

2.7 Hierarchy of the Executive Body of AIBL:


Managing
Director

Additional
Managing
Director
Executive Vise
President

Senior Vise
President

Vise President

Assistant Vise
President

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2.8 Branch Location all over Bangladesh:


DHAKA DIVISION:
Motijheel
Moulovi Bazar
VIP Road
Motijheel Corporate
Nowabpur Road

Jubily Road
O R Nizam Road
Coxs Bazar
Chowmouhani
Feni
Comilla
Companohonj

North South Road


Uttara Model Town
New Elephant Road

RAJSHAHI DIVISION:

Banani

Rajshahi

Mirpur

Bogura

Mouchak

Syedpur

Khilkhet

Mohadevpur

Mohammadpur Krishi Market


Dilkusha
Islampur
Progoti Sboroni
Mymensing
Joydebpur
Madhobdi

KHULNA DIVISION:
Khukna
Satkhira
Benapole
Jessore

Pagla
Narayangonj

BARISAL DIVISION:

Kapasia

Barisal

CHITTAGONG DIVISION:

SYLHET DIVISION:

Agrabad

Lal Dhigir Par

Khatun Ganj

Jinda Bazar
Moulovi Bazar
Ruposhpur
Biani Bazar

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Graphically AIBL Countrywide Branches:

2.9 CORPORATE CULTURE


Al-Arafah Islami bank is one of the most disciplined Banks with a distinctive corporate
culture based on Islami Shariah. Here they believe in shared meaning, shared
understanding and shared sense making. The people in this bank can see and understand
events, activities, objects and situation in a distinctive way. They mould their manners
and etiquette, character individually to suit the purpose of the Bank and the needs of the
customers who are of paramount importance to the bank. The people in the Bank see
themselves as a tight knit team/family that believes in working together for growth. The
corporate culture has developed has not been imposed; it has rather been achieved
through their Corporate conduct.

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2.10 SHARIAH BOARD


Shariah Council of AIBL consists of 5 members specialized in Fiqhul Muamalat
(Islamic Commercial Law) according to guidelines given by the Bangladesh Bank to
ensure whether all banking operations are transacted in accordance with Islami Shariah
i.e. Quran, Sunnah, Ijma, and Iztihad.
In the year 2007 the Shariah Council has complied various decisions taken by the
council on different matters at different times under the caption Islami Banking
Shariah Nitimala (1995-2006) and prepared a Shariah Manual and published which is
first of its kind in Bangladesh. Shariah Council advices everybody concerned to comply
with Shariah requirements and render all out efforts to increase the standard of service
rendered to the clients.

2.11 Information Technology of AIBL


AIBL has already started providing on-line general banking services to the clients from
23 May 2008 through a network of all branches in the country using satellite based
Communication links. This bank is a member of the Society for Worldwide Interbank
Financial Telecommunications (SWIFT).All of the Authorized Dealer Branches has
SWIFT connectivity. The bank will introduce a few more products for the client, such
as, SMS banking, Tele-banking, Internet Banking etc in near future. To present the
overall picture of the bank to the Depositors, Shareholders, and Investment Clients and
Well wishers in home and abroad transparently bank has designed a web site as www.alarafahbank.com.

2.12 Welfare Projects of AIBL


Staff Welfare Project
The Bank always kept a careful eye on the economic security and benefit of its staffs &
officers. The Bank operates a contributory provident fund, a social security &
benevolent fund and a gratuity fund for its employees. In the year 2010 Tk. 7.5 lac was
paid to wife of late Mr. Shahidul Islam, AVP & former branch manager of Joydevpur
Branch from bank's social security & benevolent fund. Till now a total of Tk. 30 lac has
been paid from the fund to the families of late officers & staffs of the bank.

Al-Arafah Islami Bank Foundation


The Bank has a Foundation launching philanthropic activities Al-Arafah English
Medium Madrasah and Al-Arafah Islami Bank Library are major two wings for
launching philanthropic activities.

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Al-Arafah English Medium Madrasah


Al-Arafah English Medium Madrasah has been established by the Al-Arafah Bank
Foundation with a view to building next generation according to the ideals of peace and
equality of Islam and to establishing banking and other aspects of life in the way of
Islam. The prime aim of this madrasah is to contribute towards building human resource
and in the broader sense to ensure human welfare. With this in view Al-Arafah Islami
Bank Foundation has established an English Medium Madrasah at Khilkhet in 1999.
Such institution up to O level of its kind is for the first time in Bangladesh.

Al-Arafah Islami Bank Library


Library is the carrier and reservoir of knowledge. Al-Arafah Islami Bank has shown that
other than generating profit, it can also contribute significantly in the field of providing
good source of knowledge by establishing a public library at 32, Topkhana Road,
Chittagong Bhaban (1st floor), Dhaka, thus strengthening social development. It is
placed in a sound, healthy surroundings. It harbours 23,000 books of reference for the
researchers, students, professionals, bankers, physicians, engineers, politicians, writers
or journalists, even for the kids. It is open to all from the year 2000 and well located &
accessible to everybody. It procured some exceptional collection of books on Religion,
Economics, Banking, Computer Science, Business Administration, Sociology, English
& Arabic language and juvenile literature in Bangla, English, Urdu & Arabic which are
very rare.
Varieties of good books were procured in the library, but those were
predominantly to enrich Islamic knowledge and culture. To fulfill that goal Al-Arafah
Islami Bank distributed a total of 1084 copies of Arabic-BangIa 'Torjomatul Quran' to
all the upazillas of the country.
Education is the harmonious development of body, mind & soul. If religion is
not attached to it the real attitude towards life and values will fail to develop. It is
mandatory to learn Elm-e-Din to govern our life in the right way of Islam. To fulfill this
noble intention Al-Arafah Islami Bank Library started Dars-ul-Quran (Teachings of
Quran) program. This program will cover translation with detail explanation of Quran
starting from Sura Fatiha upto Sura Nas gradually. Dars-ul-Quran program takes place
every Monday after Magrib prayer.
Other than this Al-Arafah Islami Bank Library arranges shows of feature films
or Documentary films on Islamic life & Culture.

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2.13 Organogram of Al-Arafah Islami Bank Ltd.


Khilkhet Branch
Branch
ManagerVP

Second
Officer

Senior
Officer

Officer

Junior
Officer

Assistant
Officer

Messenger
Figure: Organization structure of Al-Arafah Islami Bank Ltd

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2.14 CLASSIFICATION OF BANK PRODUCT


THE PRODUCT

Deposits

Advances

Time
demand

Fund oriented

International
banking
L/C, Foreign
currency

Consultancy

Miscellaneous

Tax, consultancy,
Marcent banking
project,
Counseling,
Investment
counseling

Self-custody,
Sale of drafts,
Standing
instruction,
Trusteeship.etc.

Non-fund oriented

Guarantees
Terms loans, Clean
Letter of credit.
loans, Bills
discounting, Pre
shipment, Post
shipment, Lines of
credit- Secured,
unsecured,
Overdraft.

Fig: - Structure of Bank Product

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2.15 SERVICES OF Al-Arafah Islami BANK LTD.


The importance of mobilizations of savings for the economic development of our
country can hardly be over emphasized. We considered savings and deposits as
lifeblood of the bank. More the deposit, greater is the strength of the bank. The bank
intends to launch various new savings scheme with prospect of higher return duly
supported by a well-orchestrated system of customer services. The bank would cater to
the credit needs of individuals as well as corporate clients. Initial it will emphasize on
trade finance, which would be short term and self-liquidating in nature. Considering the
importance of foreign trade in our national life, financing and handling of export &
import business and also handling of foreign remittance business would be given top
most priority. Moreover the bank operate all of its activities under the rules and
regulations of Islamic Shariah.The services provided by the Al-Arafah Islami Bank Ltd.
is given bellow: -

Bank services

General banking
Different accounts
open, issues of
DD. TT. PO,
Clearing,
FD, Different
Scheme etc.

Credit/advance

Foreign exchange

SOD General loan,


House building
loan, Lease finance,
Hire purchase,CC
hypo, Staff loan,
CCS etc.

Export
Import
Remittance

Figure: various services provided by Al-Arafah Islami Bank

2.16 Manpower of AIBL Khilkhet Branch


Designation

Total Number

VP

Senior Officer

Officer

Junior Officer

Assistant Officer

M.C.G.

1
Total

22

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General Banking Division

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3.1 General Banking


The starting point of all the banking operations is General Banking. It is an important
department for all banks because it provides services to the customers day-to-day. Front
Desk is the important for general banking. Customers give their deposits and meet their
demand for cash by honoring Cheques. The customer opens new accounts, remit funds,
issues bank drafts and pay orders etc. There are various sections in this department,
which are as follows: 1)
2)
3)
4)

Cash Section
Accounts Opening Section
Cheque Clearing Section
Remittance Section

1) CASH SECTION
The most vital and important section of the branch is Cash Department. It deals with all
kinds of cash transactions. This department starts the day with cash in vault. Each day
some cash that is opening cash balance are transferred to the cash officers from the cash
vault. Opening cash balance is added by cash receipts and payments. The figure is
called closing balance. This balance is then added to the vault. This is the final cash
balance figure for the bank at the end of any particular day.
Books Maintained By This Section
Vault Register
Cash Receipt Register
Cash Payment Register
Rough Vault Register
Cash Balance Book

: It keeps account of cash balance in vault in the bank.


: Cash receipt in whole of the day is recorded here.
: Cash payments are made in a day are entered here.
: Cash calculation for final entry in vault register is done
here as any error and correction here is not acceptable. ,
: Balance here is compared with vault register. If no
difference is found, indicates no error.

Functions of Cash Department

Cash Payment

1. Cash payment is made only against Cheque


2. This is the unique function of the banking system, which is
known as payment on demand
3. It makes payment only against its printed valid Cheque.

Cash Receipt

1. It receives deposits in form of cash


2. It collects money only its receipts forms.

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Cheque Cancellation or Cash Payment Process:


Step 1

1. Receiving Cheque by the employee in the cash counter


2. Verification of the followings by the cash Officer in the computer
section

Step 2

1. Date of the Cheque(present within 6 months from issue date)


2. Issued from this branch
3. Amounts in figure and sentence written does not differ
4. Signature of the drawer does not differ
5. Cheque is not torn or mutilated

Step 3

Gives pay cash seal and sends to the payment counter

Step 4

Payment officers make payment

2) ACCOUNT OPENING
Account opening section is an important factor for banks because customer is the main
source of bank. Selection of customer is another important factor. Banks success and
failure largely depends on their customers. If customer is not good then may create
fraud and other problems by their account with bank and thus destroy goodwill of
banks. Therefore, bank must be conscious in selecting its customer. For this reason AlArafah Islami Bank Ltd. keep key information system.
Accounts Opening Process:
Step 1
I. Receiving filled up application in banks prescribed form mentioning what
type of account is desired to be opened.
II. The form is filled up by the applicant himself/ herself
III. Two copies of passport size photographs from individual are taken, in case of
firms
IV. photographs of all partners are taken
V. Officer are taken information from customer by key information system
Step 2
I.
II.
III.
Step 3
I.
II.

Applications must submit required documents


Applications must sign specimen signature sheet and give mandate
Introducers signature and accounts number-verified by legal officer
Filling & signing up KYC or Know Your Customer Form
Filling & signing up Owner Information Form

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Step 4
Authorized Officer accepts the application
Step 5
Minimum balance is deposited-only cash is accepted
Step 6
Account is opened and a cherub book and pay-in-slip book is given

INFORMATION COLLECTED TO OPEN ACCOUNT


A. Individual
1. Name
2. Present and Permanent Address
3. Date of birth and age
4. Nationality
5. Tax information number (TIN- if available )
6. Passport or certificate provided by the employer
7. Photograph of the account holder
8. One photograph of the nominee duly attested by the account holder.
9. nominee declaration form
10. money laundering leaflet
B. Partnership Firm
1. Information Mentioned in -A
2. Copy of Partnership Dead
3. Mandate from the partners is essential indicating who will operate the account
C. Limited Company
1. Information Mentioned in -A
2. Certificate of Incorporation
3. Copy of Memorandum and Article of Association
4. Certificate of Commencement
5. Copy of Resolution of the Board of Directors
DORMANT ACCOUNT
If any account is inoperative for more than one year is called dormant account. To
operate these accounts manager permission is necessary.
TRANSFER OF ACCOUNT
When account is transferred, following steps are considered:
A) Application in written to the Manager of the account maintaining branch
B) Manager sends a request to the manager of the desired branch of depositors
C) Sends original Account opening application and specimen signature sheet with
the balance remained in the account at he sent Managers request
D) New account is opened at desired branch

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3) CHEQUE CLEARING
Bank receives all kinds of Cheque in favor of the client for clearing. When Cheque is
received it is necessary to endorse it and cross it specially.
Types

Explanation

Inward
Clearing
Cheque

Cheque received from the ClearingPartys A/C ----Dr.


House of Al-Arafah Islami Bank.
Al-Arafah Islami Bank General A/C---Cr

OBC
(Outward Bills
Collection)
Clearing Cheque

Outward Clearing

Clearing Process

Cheques of other branch of Al-ArafahThese Cheques are directly sent to the respective Branch and
Islami Bank within its Clearing House request them to sent IBCA. When it comes, then Customers
forarea.
Accounts is credited for the Cheque.
Cheques another Bank within Al-These cheques are sent to clearing house via Khilkhet branch.
Arafah Islami Bank Clearing HouseWhen drawee bank honor the Cheques, then the account of Cheque
area.
depositors are credited.
Cheques for

If any branch of Al-Arafah Islami Bank exists Within the clearing


house area of drawee Bank then Al-Arafah Islami Bank send the
Cheque to that Branch of Al-Arafah Islami Bank and sends IBCA
to it.

another bank
outside the clearing area
Inward Bills for Collection (IBC)

From other branch of Al-Arafah Islami These Cheques are settled by IBCA, i.e. debiting depositors
Bank
account and crediting senders
branch account
From another
clearinghouse

bank

outside

theThese Cheques are settled debiting depositors account and sending


DD, MT, TT in favor of senders bank.

4) LOCAL REMITTANCE
When money is sending from one place to another place for the customer is another
important service of banks. In addition, this service is an important part of countrys
payment system. For this service, people, especially businesspersons can transfer funds
from one place to another place very quickly. There are five kinds of techniques for
remitting money from one place to another place. These are:
1) Demand Draft
2) Telegraphic Transfer
3) Telephone Transfer
4) Pay Order
Telegraphic and Telephone Transfer (TT) are almost the same, both are them are known
as TT in short.

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PAY ORDER
Pay order gives the payee the right to claim payment from the issuing bank. It is
payment from issuing branch only. Within the clearinghouse area of issuing branch.
Payment is made through clearing.
1) Examine genuinely the pay order
2) Enter into PO register and give contra entry
3) Debit if fund OK for payment.
Charges of pay order are shown in bellow by a chart:
Amount of P.O.

Commission

VAT

Total

1-100000

20

23

100001-500000

30

34

500001-1000000

50

58

1000001-Above

100

15

115

DEMAND DRAFT
This is an instrument through which customers money is remitted to another person/
firm/organization in outstation (Outside the clearing house area) from a branch of one
bank to an outstation branch of the same bank or to a branch of another bank (with prior
arrangement between that bank with the issuing branch)
Demand Draft Payment is made through the following process:
1) Confirm that the DD is not forged one.
2) Confirm with sent advice.
3) Check the Test Code
4) Make payment

TT
This is a mode of transfer / remittance of customers money from a branch of one bank
to another branch of the sane bank or to a branch of another bank (with prior
arrangement between that bank with the TT issuing branch) through telephonic
message. The issuing branch used to send the message of such remittance /transfer to
the drawer/payee branch through telephone adding certain code number or test number
on the basis of text key apparatus developed by the concerned bank for its different
branches.
Payment process of TT is:
1) Confirm issuing branch
2) Confirm payee A/C
3) Confirm amount
4) Make payment
5) Receive advice

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3.2 Various Types Of deposit account


AIBL Bank offers following types of deposit account:
1. Mudaraba Savings Deposit Account (MSD)
2 Mudaraba Current Deposit Account (CD)
3 Mudaraba Term Deposit Receipt Account (MTDR)
4 Short Notice Deposit Account (SND)
5 Installment Term Deposit (ITD)
6 Mudaraba Hazz Account
7 Mudaraba Pension Scheme
8 Mudaraba Lakhpoti Scheme
9 Mudaraba milliner Scheme
10 Mudaraba Kotipoti Scheme
11 Mudarab Double Deposit Scheme.

3.3 BRIF DESCRIPTION OF DIFFERENT ACCOUNTS:


1. Current Account:
Current account facilitates the account holder to draw money at any times but no profit
is given to the current account deposited money. Current accounts can be opened by
any individual or joint or any name of
proprietorship business, private limited company or public limited company,
association, clubs, societies, trusts etc. Generally, current account is opened for
businessman and traders for easy transaction. By taking this liability, AL-ARAFHAISLAMI Bank takes service charge 100/- for six months.

2. Mudaraba Term Deposit Receipt Account (MTDR):


It's a certain period deposited system, which is not repayable before the maturity
date of a fixed period. AL-ARAFHA-ISLAMI Bank offers higher rates of profit on such
deposits. Usually customers are allowed to open this account for a certain period and
the rate of profit in accordance with the terms of the deposit. The features of MTDR as
follows:

Minimum balance: TK 10000.00


3 months
Profit
11.00%

6 months
11.50%

1 year
12.00%

3. Savings Account:
To maintain smooth and certain life in future Savings account is very suitable for
middle class groups. The attributes of Savings Account are:
500/- is the minimum amount of initial deposit.
Client cannot withdraw money more than twice a week,
The profit rate is 8% against MD account
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For opening of this type of accounts following requirements are necessary:


a) The introducer must be attested photograph.
b) The introducer must be account holder of MD of AL-ARAFAH-ISLAMI
Bank Bangladesh Ltd.

4. Short Term Deposit (SND):


Short Term Deposit has following attributes:
6% profit rate against STD.
No restriction over withdrawal of money
1000/- is the minimum balance.

a) Installment Term Deposit (ITD)


It's a sure investment for a steady return. It can be opened for 5, 8, 10, or 12
years for Tk.200, Tk.300, Tk.500, Tk.1000, Tk.1500 and Tk2000. The savings
amount is to be deposited any day of the month. If the depositor has a separate
account in the bank for which a standing instruction can be given to transfer the
monthly deposit in the scheme's
account. Incase of failure to make the monthly installment in the schedule time 5% on
overdue installment amount will be charged. The lowest charge will be Tk. 10 and this
will be added with the following months installment. After 3 years of savings in this
schemed the depositor is eligible for a loan up to 80% of his deposited amount.
b) Highlights of the Scheme
o Mudaraba Lakhpoti Scheme
o Mudaraba milliner Scheme
o Mudaraba Kotipoti Scheme
Mudaraba Kotipoti Scheme: This are the most popular & target oriented schemes.
One can open for 3,4,5,6,7,10,12,15,18,20 years and have to pay (Monthly installment)
2,39,500/- 1,69,500/- 1,27,500/- 99,500/- 80,000/- 46,000/- 33,450/- 21,485/- 14,330/11,100/- respectively and will get 1corror.
Mudaraba milliner Scheme: For Mudaraba milliner Scheme 3,4,5,6,7,10,12,15,20
years monthly installments are 23,950/- 16,950/- 12,750/- 9,950/- 8,000/- 4,600/3,345/- 2,170/- 1,150/- respectively and will get 10million.
Mudaraba Lakhpoti Scheme: For Mudaraba Lakhpoti Scheme 3,5,8,10,12 years
monthly installments are 2,375/- 1,275/- 670/- 460/- 335/-/- respectively and will get
1lak.

Conditions of the Scheme


1) By filling up a form an account is opened.
2) A non-transferable deposit receipt will provide to the customer after opening
the account.
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3) If the deposit is withdrawn before a 5-year term, then saving interest rate will
be applicable and paid to the depositor. However, no in profit paid if the deposit
is withdrawn within 1 year of opening the account and Monthly Income paid to
the customer will be adjusted from the principal amount.
4) This scheme will be credited to the loan account until liquidation of the loan
amount inclusive of profit. A depositor can avail loan up to 80% of the deposit
amount under this scheme.

c) Mudaraba Double Deposit:


Savings works as the very foundation of development. Savings is the prime
source of business investment in a country. So it helps to build up capital. To create
more awareness and motivate people to save, ALARAFAH-ISLAMI Bank offers Mudaraba Double Deposit. Here people put their
money for double return after 6years.

Conditions Of The Scheme:


a) The deposit can be made in multiplies of TK. 10000.00.
b) This is 6 years period deposit. The deposit cannot be withdrawn at
any time with in the maturity date.
c) Al-Arafah monthly deposited Hazz account:
d)Pension scheme

3.4 CLEARING DEPARTMENT


Cheques clearing section of Al-Arafah Islami Bank Ltd. receives cheque, demand drafts
and pay orders of their clients. Upon the receipt of the instrument the cheque clearing
section examines:
Whether the paying bank within Dhaka city.
Whether the paying bank outside Dhaka city.
Whether the paying bank of their own branch..
The Paying Bank within Dhaka City:
The cheques clearing section of Al-Arafah Islami Bank Ltd., Khilkhet Branch sends
Inter Branch Debit Advice (IBDA) to the head office on the receiving day of the
instruments. The main branch takes those instruments to the clearinghouse on the
following day. If the instruments are dishonored, Head Office of Al-Arafah Islami Bank
Ltd. sends IBDA to the Al-Arafah Islami Bank Ltd., Dhanmond branch
The Paying Bank of Their Own Branch:
The cheque clearing section of Al-Arafah Islami Bank Ltd., Dhanmond branch sends
outward bills for collection (OBC) to the concerned paying branch to get Inter Branch
Credit Advice (IBCA) from the paying branch. If the paying branch dishonors the
instrument, the paying branch returns it to the Al-Arafah Islami Bank Ltd., Dhanmond
branch describing why the instrument is dishonored.
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3.5 Types of Cheque Collected By Clearing Department:


1. Transfer Cheque
Transfer Cheques are those cheques, which are collected and paid by the same branch of
Al-Arafah Islami Bank Ltd.
2. Local Bills Collection Cheques (LBC)
Local bills collection cheques are those cheques, which are collected and paid by two
different branches of a bank situated in the same city.
3. Outward Bills Collection Cheque (OBC):
OBC cheques are those cheques, which are collected and paid by two different branches
of same or different bank situated in the outstation.
CLEARING HOUSE
Clearing House is an arrangement under which member banks agree to meet, through
their representatives, at an appointed time and place to deliver instruments drawn on the
other and in exchange, to receive instruments drawn on them. The net amount payable
or receivable as the case may be, is settled through an account kept with the controlling
bank.

Types of Clearing
1. Outward Clearing
Outward clearing means when a particular branch receives instruments drawn on the
other bank within the clearing zone and those instruments for collection through the
clearing arrangement is considered ad outward clearing for that particular branch.
2. Inward Clearing
When a particular branch receives instruments, which drawn on them and sent by other
member bank for collection are treated as inward clearing.

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Performance of Al-Arafah Islami Bank Limited.

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4.1 MARKETING STRATEGIES OF AL-ARAFAH


ISLAMI BANK
Vision of AIBL:
To be a pioneer in Islamic Banking in Bangladesh and contribute significantly to the
growth of the national economy.

Mission of AIBL:

Achieving the satisfaction of Almighty Allah both here and hereafter.


Proliferation of Shariah Based Banking practices.
Quality financial services adopting the latest technology.
Fast and efficient customer service .
Maintaining high standard of business ethics.
Balanced growth.
Steady and competitive return on shareholders equity.
Innovative banking at a competitive price.
Attract and retain quality human resources.
Extending competitive compensation packages to the employees.
Firm commitment to the growth of national economy.
Involving more in Micro and SME financing.

To attain the above vision and mission AIBL follow the following
Marketing Strategies:

The main strategy of the bank is using Islami Banking System to attract its
market.
Providing efficient customer service
Maintaining corporate and business ethics
Being trusted repository of customers and their financial advices
Making its products superior and rewarding to the customers
Display team spirit and professionalism
Sound capital base
Enhancement of shareholders wealth
Fulfilling its social commitments by expanding its charitable and humanitarian
activities
Providing high quality financial services in export and import trade.
Building tight personal relationship with customers and clients
Taking less promotional activities and emphasizing on relationship marketing.

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4.2 FINANCIAL HIGHLIGHTS OF AIBL (2007-2008)


BALANCE SHEET
PROPERTY AND ASSETS
2009
Cash
In hand (including foreign currency)
280,802,510
Balance with central bank & other 2,134,413,797
banks
2,415,216,307
Balance with other banks and
financial institution
In Bangladesh
3,326,336,473
Outside Bangladesh
310,706,205
3,637,042,678
Money at call & short notice
Investment in share and Securities
1,090,225,921
Govt.
1,000,000,000
Others
90,225,921
Investments
General Investment etc.
27,189,194,281
Bills Purchased & Discount
2,534,596,576
29,723,790,857
Premises & fixed assets
Others assets
396,763,790
Non Banking Asset
1,895,398,295
Total assets
39,158,437,848
LIABILITIES & CAPITAL

2009

2008
381,766,435
1,637,443,244
2,019,209,679
2,437,841,149
245,142,485
2,682,983,634
868,583,386
800,000,000
68,583,386
21,116,394,966
1,789,972,964
22,906,367,930
334,476,460
1,370,702,317
30,182,323,406
2008

LIABILITIES:
Borrowing from other banks 1,780,000,000
financial Institutions & agents
Deposits & other Accounts
Al-Wadia Current Account
Mudaraba Saving deposit
Mudaraba Short notice deposits
Mudaraba Term deposit
Mudaraba Special deposits

3,521,037,579
4,213,966,081
781,853,719
15,669,878,616
5,105,954,363

1,320,000,000

3,097,906,953
3,932,277,170
761,766,781
11,233,591,127
3,629,539,263

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Bills Payable
Others Liabilities
Total Liabilities
Capital shareholders equity:
Paid up capital
Asset Revaluation Reserve
Statutory reserves
Exchange Equalization
Retain Earning
Total share holder equity
Total liabilities & shareholder
equity

397,430,799
29,690,121,157
4,982,575,932
36,452,697,089

354,096,993
23,009,128,287
3,815,696,649
28,144,824,936

1,383,810,400
64,603,248
838,667,261
2,057,198
416,602,652
2,705,740,759
39,158,437,848

1,153,175,400
64,603,248
586,886,597
2,057,198
230,776,027
2,037,498,470
30,182,323,406

4.3 PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED


2007-2008
INCOME
Investment income
Less: profit paid on deposits.
Net Interest Income
Commission, exchange & brokerage
Income from Investment in Share
/Securities
Other operating Income
Total operating Income
Salaries & allowances
Directors and Sharia Council fees and
expenses
Rent, taxes, insurance, lighting &
traveling
Legal expenses
Postage, stamp, telegram & telephone
Auditors fee
Depreciation and Repairs
Salary & Allowance to the Managing
Director
Stationery, printing & advertisement
Other expense
Total Operating Expenses
Profit before Tax and provision
Provision
against Investment and
Contingent Liabilities

2008
3,502,144,083
(2,220,465,915)
1,281,678,168
691,524,617

2007
2,243,147,857
(1,628,628,877)
614,518,980
566,470,987

68,679,903

2,601,615

124,916,738
885,121,258
2,166,799,427
416,090,711

143,388,985
712,461,587
1,326,980,567
400,419,052

3,892,184

5,363,612

72,146,865

66,389,460

1,566,436
25,387,745
200,000
42,597,447

5,120,925
15,904,341
200,000
19,677,065

5,400,4000

4,300,000

13,070,494
58,347,684
638,699,566
1,528,099,861

13,127,054
40,298,765
570,800,273
756,180,294

257,113,090

173,336,636
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Other Provision
Total provision
Profit/Loss before tax
Current tax
Deferred Tax
Provision for Taxation
Net Profit/Loss after tax
Retained Profit brought forward

12,083,453
269,196,543
1,258,903,318
619,702,611
(29,041,582)
590,661,029
668,242,288
141,026
668,383,316

----173,336,636
582,843,658
354,484,244
(118,954,752)
235,529,492
347,314,166
30,593
347,344,759

251,780,664

116,568,732

251,780,664

116,568,732

416,602,652
48.29

230,776,027
25.10

Appropriation
Statutory Reserve

Retained Earnings
Earning per Ordinary Share

4.4 PERFORMANCE OF AL-ARAFAH ISLAMI BANK


LIMITED
DEPOSIT
The total deposit of AIBL is increasing sharply. The total deposit of bank was Tk.
23009.13 million at 31st December 2009 as against Tk. 16775.33 million at 31 st
December 2009 recording growth of 37.16% of which Tk. 685.50 million was bank
deposit and general deposit was 22323.63 million Tk. The graph shows that the deposit
collection rate is dramatically increasing year to year:

INVESTMENT
The investment of the Bank stood at Tk. 22906.37 Million as on 31 st December
2009 as against Tk. 17423.19 Million in the previous year showing an increase by
31.47%. The growth of Investment from 2006 to 2009 shown graphically, graph shows
that every year the bank earns a huge amount of income from Investment account.

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OPERATING PROFIT
The Bank earned operating profit of Tk. 756.18 million during this year 2009
before the pre-tax profit of the bank during the year 2009was Tk. 969.77 million and
thus the bank attained negative growth of 22.02% in respect of operating profit. The
growth of operating profit for the year 2006 to 2009 graphically given below. Political
unrest, economic recession and many other factors badly affected they total banking
sector, so that it earn lower profit than the previous year.

DIVIDEND
The Bank has been paying Dividend every year since 1998 just after conversion of a
public limited company. The Board of Directors of the Bank recommend 20% stock
dividend in the year 2009, which is lower than the previous year because of lower
operating profit. Dividend for different years shown below graphically:
EXPORT
The total export earning in 2004 was Tk.3639.34 Million and in 2007 it was
Tk.12714.91 Million. So it is seen that the export earnings was 3.49 times in 2007 than
2004. It is also depicted from the figure.

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IMPORT
The total Import earning in 2006 was Tk.9337.49 Million and in 2009 it was
Tk.27042.72 Million. So it is seen that the Import earnings was 2.9 times in 2007 than
2006. It is also depicted from the figure:

HUMAN RESOURCES
The total number of human resources in 2009 was 771 and in 2009 it was 1033.So
number of employees in AIBL has increased by 262 employees from the year 2006 to
2009, which are shown below graphically:

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BRA
NCHES
The total number of Branches in 2006 was 40 and in 2009 it was 46.So number of
Branches in AIBL has increased by 6 Branches from the year 2006 to 2009, but in 2009
there were no addition of Branches, this is shown below graphically:

4.5 PERFORMANCE OF AIBL KHILKHET BRANCH


KHILKHET BRANCH
(THREE YEARS DEPOSIT, INVESTMENT, EXPORT, IMPORT & PROFIT)
Tk. In Crore
Year

2009
2007
2006
2009
2008
2007

HEAD OF ACCOUNTS
DEPOSIT TARGET

DEPOSIT ACHIEVED

ACHIEVED IN PERCENTAGE

150
100
60
INVESTMENT TARGET
50
40
16
EXPORT TARGET

102.48
67.4
60.89
INVESTMENT ACHIEVED
21.11
17.79
17.70
EXPORT ACHIEVED

68.32%
67.40%
101.50%
ACHIEVED IN PERCENTAGE
42.22%
44.22%
110.65%
ACHIEVED IN PERCENTAGE

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2009
2008
2007
2009
2008
2007
2009
2008
2007

Performance Evaluation of Al-Arafah Islami Bank Limited.


.20
.29
148.53%
IMPORT TARGET
IMPORT ACHIEVED
ACHIEVED IN PERCENTAGE
20
20.06
100.31%
30
12.5
41.7%
15
14.19
94.64%
PROFIT TARGET
PROFIT EARNED
ACHIEVED IN PERCENTAGE
10
1.19
11.96%
3.5
3.6
103.14%
2
2.002
100.10%

4.6 ANALYSIS OF DATA


From the above it is seen Khilkhet branch of AIBL is running well to the goals of the
AIBL. Though it has shown some cyclical variation in various years but its deposit
collection, investment, export & import activities and above all the ultimate target is
showing that Khilkhet branch of AIBL perform its management expectation
satisfactorily.

DEPOSIT
The Banks deposit collection rate is quite well such as in 2006 and 2009. It collected
Tk. 102.48, 67.4 and 60.89 cores respectively although management targeted Tk.150,
100 and 60 cores respectively. But it could not achieve its target in 2006 and 2009
because Economic recession, political and for many other reasons. But in 2005 it
achieve 101.50% of its target. The collection of deposit is gradually increasing. That is
shown by the graphically representation.

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INVESTMENT
The Branch made more investment than its target in 2007.In 2007 its investment target
was 16 crore whereas its achievement was 17.70. In 2008 its target was 40 crore, but
achievement was 17.79. In 2009 it has achieved 42.22% of its total target. The
investment is gradually increasing. That is shown by the graphically representation.

EXPORT
AIBL Khilkhet branch is less export oriented. in 2007 it has an export target of 20 lac
only whereas it has achieved 29 lac export which is 148.53% of target.

IMPORT
In 2007 the AIBL Khilkhet Brach has achieved 94.68 %of its import target. Its target
was 15 crore where its achievement was 14.19 crore. In 2008 and 2009 Its import target
was 30 and 20 crore respectively where its achievement was 12.51 and 20.06 crore
respectively. Achievement percentage in 2008 and 2009 was 41.7% and 100.31%
respectively.

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PROFIT
The profit earning capacity of the branch is not good. This branch is failed to fulfill the
targeted profit in 2011. Its target was 10 crore where it achieved only 1.19 crore, which
is 11.96% of its target. The branch achieved 100.10% and 103.14% of its target 2009 & 2010
respectively. High operating expense is the worst condition of profit. The graph shows
how year to year the branch earned its profit.

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SWOT ANALYSIS, FINDINGS,


RECOMMENDATION AND CONCLUSION

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5.1 SWOT ANALYSIS


Not surprisingly, in the competitive arena of marketing era SWOT analysis is a must
based on Product, Price, Place and Promotion of a financial institute like private bank.
From the SWOT analysis we can figure out ongoing scenario of the bank. So to have a
better view of the present banking practices of Al-Arafah Islami Bank Ltd.

SWOT Analysis
Internal
Internal
Factors
Factors
Strength

External
External
Factors
Factors
Weakness

Opportunity

Threats

In SWOT analysis two factors act as prime movers


Internal factors which are prevailing inside the concern which include Strength
and weakness.
On the other hand another factor is external factors which act as opportunity and
threat.

Strength:

Usage of faster PC Bank software.


Membership with SWIFT.
Good banker-customer relationship.
Online banking system.
Islami Shariah based Banking system.
Energetic as well as smart work force.
Competitive Profit provider comparing with other Islamic Bank.
Strong Financial Position.
Efficient administration

WEAKNESS:

Reluctance to ad campaign.
Existing manual vouchers.
Lack of consumer credit scheme.
Manpower is not sufficient.
Marketing policy is not well setup.
Limited number of branches in its network.
Officers have limited experience and not enough trained
Many inexpert and laggard assistant officers.
The bank has no ATM service
Insufficient number of deposit Scheme and loan.

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OPPORTUNITY:

Huge business area.


Introducing consumer credit scheme.
Growth of sales volume.
Introducing branch banking through online.
Develop relations and correspondence with foreign banks.
More concentrated Banking based on Islamic Shariah.
Few Competitors practicing Islamic Banking.

THREATS:

Competitors have more attractive deposit schemes.


Bangladesh Bank has no well established Islami Banking Rules.
Different classic services of other banks.
Entrance of new private commercial banks.
Young, energetic, dynamic, talent and smart work force of competitors.
Govt. imposes high rate of taxes and VAT.
Political unrest and Economic recession.
Illegal business operation by the some clients.

5.2 Findings and Analysis:

AIBL profit earning capacity is not satisfactory.


Its marketing strategy is not well designed.
Existing Human Resources are not sufficient for AIBL. They have to recruit
more skilled employees.
Number of Branches are not satisfactory, AIBL have to give more emphasize on
increasing number of Branches.
Recruitment and selection process is a time consuming and lengthy process and
irregular.
The whole activities of AIBL is not computerized, still there exist manual record
keeping system.
Sometimes Islami Shariah are not properly followed.
Job security is lower in AIBL.
Insufficient training program for the employees.
Slower in modernization comparing with its competitors.
The working environment in any branch is not congenial & appropriate. The
working desk provides sound pollution. It looks like a hall room.
The modern technology is not used in the recruitment and selection process. The
backdated methods are using for selection till today.
Salary structure of AIBL is satisfactory comparing with other Islamic Banks, the
pension policy and the payment of pension to the employees are very fair and
transparent.
The transfer and promotion process is fair but the promotion is not faster.
Loan facilities are very attractive to the employees of AIBL.
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Most of the policies are backdated. Only the authority amends the policy but
preserve the old policy.

There is no policy to build up harmonious relationship among the employees.


The employees cannot protest the injustice of the authority because the pure
trade union is absent there.
The record keeping system is also backdated, not followed computerized system
properly
Security system of many branches is not sufficient.

5.3 RECOMMENDATION

AIBL should concentrate in increasing its profit earning capacity.


It should develop effective marketing strategy to attract new customers.
Raising the capital, statutory reserve and increase the investment.
The number of branches should be increased
Expand and diversify customer base.
Upgrade Online Banking.
Recruit more skilled employees regularly.
Bank should introduce independent Marketing Department
Personal relationship should be build with the customers.
Customers are the heart of the organization. They should provide more space in
the office and if possible they should have some entertainment facility.
The employee of the branch should be trained continuously.
Few branches are not under online banking system, so all the branches should
confirm on line banking system.
More meetings, seminars, symposiums and get-together should be organized by
the Branches to develop the awareness among the clients of the Bank about
Islamic Banking and its advantages.
Ensure stable dividend.
Ensure high level customer service.
The Bank should follow Islami Sharia strictly in every of its operation.
Bank should introduce ATM system.
Should introduce one-stop service centre.
Bank should keep their annual report, brochure, bulletin etc. available to provide
their customer.
Bank should introduce consumer credit scheme.
Bank should increase their office space and take more care in interior
decoration.
Bank should introduce independent Marketing Department.
Some new investment schemes are to be introduced for socio-economic
development and welfare of the distressed humanity.
Finally the Bank should has the vision to automate its all operations and
functionalities and should be committed to achieve the goal to be a lead Bank in
the country both in service and in technical aspect and to fulfill the requirements
of mass people.
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5.4 Conclusions
Today the banking service is very competitive. From the practical materialization of
customer dealing procedure during the whole period of my practical orientation in ALARAFAH-ISLAMI Bank limited I have reached a firm and concrete conclusion in a
very confident way. I believe that my realization will be in harmony with most of the
banking thinkers. It is quite evident that to build up an effective and efficient banking
system to the highest desire level, computerized transaction is must.
AL-ARAFAH-ISLAMI Bank Ltd. is a new generation Bank. It is committed to provide
high quality financial services/products to contribute to the growth of G.D.P of the
country through stimulating trade and commerce, accelerating the pace of
industrialization, boosting up export, creating employment opportunity for the educated
youth, poverty alleviation, raising standard of living of limited income group and
overall sustainable socio-economic development of the country. The is not so far when
it will be in a position to overcome the existing constraints and it may be expected that
by establishing a network over the country and by increasing resources this bank will be
able to play a considerable role in the portfolio of development of financing.
Success in the banking business largely depends on effective lending. Less the amount
of loan losses, the more the income will be from credit operations. The more the income
from credit operations the more will be the profit of the AL-ARAFAH-ISLAMI Bank
Ltd. and here lays the success of credit financing.
It can be argued that though the results achieved so far are not satisfactory, credit
financing is a modern scientific technique for enhancing AL-ARAFAH-ISLAMI Banks
strength and there lies the opportunities to make it more effective in the future for our
own benefit.
From the learning and experience point of view I can say that I really enjoyed my
internship at AL-ARAFAH-ISLAMI Bank Ltd. from the very first day. I am confident
that this 03 months internship program at AL-ARAFAH-ISLAMI Bank Ltd. will
definitely help me to realize my further carrier in the job market.

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Bibliography
Annual Report of AL-ARAFAH ISLAMI Bank Limited (2009)
Several Booklets from AL-ARAFAH ISLAMI Bank.
Several Newsletter s from AL-ARAFAH ISLAMI Bank.
AL-ARAFA H ISLAMI Bank web site, www.al-arafahbank.com
Credit Operational Manual of AL-ARAFA H ISLAMI Bank Limited.
SHARIAH MANUEL published by Al-Arafah Islami Bank Limited.

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