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Merchant banking in bangladesh a case study on prime finance investment ltd

A banking institution is indispensable in a modern society. It plays a pivotal role in the economic development of a country and forms the core of the money market in an advanced country. In recent times the banking sector over the world has been undergoing a lot of changes due to deregulation, technological innovation, globalization etc. Bangladesh banking sector is lagging for behind in adopting these changes.

In this part the tried to be acquainted with every department of credit. In this part the tried to present personal observations from credit department. The main objective of the study is to gather practical knowledge regarding banking system and operation. This practical orientation gives us a chance to co-ordinate the theoretical knowledge with the practical experience.

Merchant banking in bangladesh a case study on prime finance investment ltd

The following are of objectives for this practical orientation in bank: The report covers the following areas. Background of Prime Bank Ltd. Literature on Credit operation. Credit Operation of Prime Bank Ltd. The study inputs were collected from two sources: There were some problems while conducting the orientation program.

A wholehearted effort was applied to conduct the orientation program and to bring a reliable and fruitful result. In spite of having the wholehearted effort, there exist some limitations, which acted as a barrier to conduct the program. This situation has created a lot of problems to understand why a specific function is being performed. PBL starts in 1995. So there are shortages of sufficient data for comparing. Moreover, the bank has supplied me the annual report only for two years.

Banca means long tool. In ancient time Italian Jews merchant used to do business of lending money by sitting on the tools. Then the German language was widely used in Italy. The linguistics and etymology suggest an interesting story about banking origins.

The historians have identified the first bankers who lived more than 2000 years ago. They were money changers seated usually at tables or in a small shop in the commercial district, aiding travelers who came to the town by exchanging foreign coins for local money or discounting commercial notes for a fee in order to supply merchants with working capital.

The first bankers probably used their own capital to fund their activities but it was not long before the idea of attracting deposit and securing temporary loans from wealthy customers.

Most of the early bank was Greek in origin. The banking industry gradually spread outward from the classical civilizations of Greece and Rome into northern and western Europe.

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The early bank in Europe was placed for safe keeping of valuable items such as gold and silver bullion as people came to fear the loss of their asset due to war, theft, or expropriation by government. When colonies were established in North and South America, the old world banking practice was transferred to the new world.

Bank system was practiced in Indian subcontinent by the Indian subcontinent merchants; Goldsmith Moneylenders were the primary bankers. During the mughal period banking and credit business was enchanted rapidly. Indigenous banking in Bangladesh is as old as banking in other parts of the world. During mughal period, indigenous banking flourished. The Subarna Banik, the bullion trading community used to do banking in the then Bengal.

Banking in Bangladesh was gradually taken over by the upcountry bankers who were known as Seth, Shah etc. But Subarna Banik continued to operate in rural Bengal.

The British gradually came to Bengal and operated banking in the form of agency house and exchanging houses started to flourish in Calcutta. Entry of the Bengalese into banking started in the part of this century especially in the period of the Swadeshi movement.

Then both the banks absolved respectively in 1793 and 1832. In 1947 after the separation of Bengal, bank business faced a severe disaster as non-Muslim bankers migrated to India.

In order to rebuild the bank business State bank of Pakistan was established as a central bank of Pakistan in 1948. In 1971 Bangladesh became independent.

It started operation as a commercial bank on April 17, 1995 with a branch at Motijheel. At present, the bank has 42 branches spread all over the country. It renders all types of commercial banking services to the customers of all strata in the society within the stipulations laid down the bank company act 1991 and rules and regulations formed by Bangladesh Government from time to time.

Diversification of products and services and innovation of products suited to the needs of the customers in keeping with relevant rules and laws have made it different from other commercial banks of the country. It maintains correspondent relationship with all over the banks in countries.

Prime Bank Limited is a forward looking and modern local bank with a record of sound performance. It is discarding its erstwhile conservative mould and in response to the current dynamic trends in locally financial activities, adopting an aggressive customer focused system. The effort that Prime Bank makes in order to portray the bank as a brand image is very strong and successful.

The logo of the bank depicts the merger of confidence. The bank has been graded as a top class bank in the country through internationally accepted CAMEL rating. The bank made satisfactory progress in all areas of business operation in 2005.

Prime Bank Limited was designed to provide commercial and investment banking services to all types of customer ranging from small entrepreneur merchant banking in bangladesh a case study on prime finance investment ltd big business firms.

Besides investment in trade and commerce, the bank participates in the socioeconomic development through the participation in priority sectors like agriculture, industry, housing, and self-employment. Prime Bank Limited wants to establish, maintain, and conduct all types of banking, investments and businesses in Bangladesh and abroad with superior service quality and performance.

It focuses on the emerging needs of the market and has positioned itself accordingly. Its guiding principles are rendering of service to customers more efficiently and effectively than other competitors, concentrating on core business and building self-strengths. Customer services of Prime Bank Ltd.

Exercise will continue to reform the systems and to develop back-office support capabilities. PBL has further deepened its stack in retail banking by introducing new products. Efforts in Merchant banking are further intensified to generate more profits as Prime Bank Ltd.

This Bank always stays tuned to the realities of rapidly changing markets. Management of PBL strongly believes that this bank will grow and prosper in the days to come. On going researches to innovate products and to fine-tune the existing products will lead to advantageous position. MasterCard credit cards business and newly introduced ONLINE banking have opened up new possibilities not only for improved customer service but several windows for profit generation.

Installation of SWIFT and integration of treasury functions in both local money market and international foreign exchange market are expected to yield better growth in volume and earnings. While banking is undergoing changes to accommodate increasing needs of customers, technology is considered as a key element for achieving competency based on reliability. Therefore, investment in technology infrastructure receives highest priority. While technology takes care of much of the routine functions, employees will have more time to spend with their customers providing greater range of advice and services.

At present Prime Bank Ltd. The bank has now a network of 52 branches strategically located in different cities. The Bank will try to reduce its dependence on interest earnings by giving more emphasis on the fee-based income through introduction of capital market operation and leasing. The Bank will introduce modern system of Leasing Operation merchant banking in bangladesh a case study on prime finance investment ltd as in practice with Banks in all other countries of the world.

The lease finance portfolio of the bank will be the first of its kind in a Commercial Bank in Bangladesh. A warehousing system will be developed in the country through private entrepreneurs. The conventional go down system of the Banks will gradually be done and a modern system of warehousing will be encouraged for pledge of goods of the clients. Investment Counsellors of PBL will give all sorts of advice to their Customers as they may require from time to time for protecting their assets and safeguard to their interest.

Entrepreneurship Development Training will be arranged to impart operational skill and modern technique of management to introduce new entrepreneurs in the field of industrialization on the basis of participating finance. SWIFT is a member owned co-operative which provides a fast and accurate communication network for financial transactions such as letters of credit, fund transfer etc. By becoming a member of SWIFT, the bank has opened up possibilities for uninterrupted connectivity with over 5,700 user institutions in 150 countries around the world.

The Islamic Sariah Principle Banking is completely different from the conventional banking.

The Bank is Maintaining separate set of accounts for Islamic Banking branches according to the standard adopted by financial Accounting and Auditing organization for Islamic Financial Institution. The Institute had played a significant role in making skilled and efficient human resource. It is constantly working on improvement of training methods and materials.

During 2006 it had conducted 4 Foundation Training Courses, 4 short, courses, 24 workshops for new recruits, junior level management, mid level management, and senior executives. The Training Institute also provided a Foundation course for 30 trainee officers of Jamuna Bank Limited at their cost. Prime Bank Limited will try to achieve excellence in customer service.

The customer is most important for them. Their policy is customer driven. The Bank will introduce Inland Travellers Cheque and launch Special Savings Schemes; Special Credit Scheme will also be devised for the benefit of the low-income group, specially for the self -employment of the educated youth.

To be the most efficient bank in terms of customer service, profitability, and technology application.