Chapter-01

Introduction

1.1 Introduction of the Study

For Bachelor of Business Administration (BBA) student only theoretical knowledge is
not enough for handling the real life business situation. It is a great opportunity for the
student to know about the real business operations through the internship program.
Internship program is the perfect blend of the theoretical and the practical life
experience. It is mandatory for any BBA student of Shaikh Burhanuddin Post
Graduate College. As per requirement for completion of the internship I prepared this
report “Foreign Exchange Operations of Standard Bank” which includes the study of
various international trade financing tools and settlement process and financial
analysis of the SBL.

1.2 Background of the Report

Bachelor of Business Administration (BBA) is a professional undergraduate course.
The course is designed with an excellent combination of practical and theoretical
aspects. After completion taught courses of BBA, a certain time is kept for internship.
As a student of BBA, internship is an academic requirement. For internship every
student is required to work in a selected institution to enhance ones practical
knowledge and experiences. After completing the internship prepared a report on the
knowledge of internship. From that perspective this report is prepared on
“Performance of Foreign Exchange Operations of Standard Bank”,

1.3 Significance of the Report

This internship report is an important partial requirement of four years BBA
graduation program. This is because knowledge and learning become perfect when it
is associated with theory and practice. That is, student can train and prepare
themselves for the job market. A poor country like Bangladesh has an overwhelming
number of unemployed educated graduates. As they have no practical experience been
able to gain normal professional knowledge to establish networking, which is
important in getting a job. Therefore, it is obvious that the significance of internship is
clearly justified as the crucial requirement of four years BBA graduation.

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1.4 Scope of the study
The report covers the details of Standard bank Limited’s practices about all activities.
This report consists of the writer’s observation and on the job experience during the
internship period in the Matuil Branch. The report emphasizes on the sequential
activities involved and used by Standard Bank Limited for all transactions. It also
focuses on the impact of foreign exchange activities upon clients. Finally, it
incorporates an evaluation of the different aspect of the export-import process &
financial performance of the bank and recommends some measure which may help to
develop the quality of the bank.

1.5 Objectives of the Report

The main objectives of this report are to concentrated on issues related to the
operation of foreign exchange department of Standard Bank Limited. However, the
details objectives can be divided into two parts and these are:

Broad Objectives:
The broad objectives of this report is to analyze the performance of foreign exchange
operation of Standard bank Ltd.

Specific Objectives:
There are some specific objectives also:
To analyze the Import and Export performance of SBL.
To analyze the Remittance performance of SBL.
To identify some problems in foreign exchange operations and make possible
recommendation to improvement.

1.6 Methodology
Methods followed to perform a job or conducting activities to complete a task is
called methodology. In conducting this study the following methodology was adopted
in collecting data and information, preparation of reports etc. The methodology of
report is given below.
1.6.1. Research Type: This is a Descriptive Research, which briefly reveals the
overall foreign exchange performance of Standard Bank limited.
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1.6.2. Sources of Data
To prepare this report all the necessary information collected from …
 Secondary sources
1.6.3. Secondary sources of data
Annual Reports of Standard Bank limited, 2013,2014,2015,2016,&2017 other
published documents of the, Standard Bank’s Website.

1.7 Limitations
This report might be limited with some constraints. Details of many aspects of the
services of Standard Bank Limited have been skipped in this report due to various
constraints, including time and space. Moreover, one of the main barriers in writing
this report was the confidentiality of data. Besides, for the preparation of this report I
found that there are some limitation exists though I have given my greatest effort.
Such as:
 The bankers are very busy with their job which lead me little time to consult
with.
 Category wise export, import and remittance business; amount originated from
the international trade is missing in the report for their restriction.
 In many cases, up to date information was not published.
 All the branches of the sample banks were not physically visited.
 Non-availability of reference books is another limitation.
 Due to time limitation many of the aspects could not be discussed in the
present report. Learning all the functions within just 60 days is really tough.

However, omitting the limitations, the report will help to understand the Foreign
Exchange Performance of the Bank.

Chapter-02
Organizational Overview

2.1 Background
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The banking sector of Bangladesh comprises of three categories of schedule banks.
These are nationalized commercial banks (NCBs), private commercial banks (PCBs)
and foreign commercial banks (FCBs). Private commercial banks are again divided
into three categories- First generation, Second generation and Third generation.
Standard bank falls into the third generation segment and undoubtedly leads its own
generation. As an intern from business discipline with major in finance I have got the
opportunity to work with this bank and try to put my effort to make a depth study.

Standard Bank Limited is a scheduled Bank under private sector established under the
ambit of Bank Company Act, 1991 and incorporated as a public limited company
under Companies Act, 1994. The Bank started commercial banking operations
effective from June 06, 1999. During this short span of time the Bank had been
successful to position itself as a progressive and dynamic financial institution in the
country.

2.2 History of Organization

Standard Bank Limited (SBL) was incorporated as a Public Limited Company on
May 11, 1999 under the Companies Act, 1994 and the Bank achieved satisfactory
progress from its commercial operations on June 03, 1999. SBL has introduced
several new products on credit and deposit schemes. It also goes for Corporate and
Retail Banking etc. The Bank also participated in fund Syndication with other Banks.
Through all these myriad activities SBL has created a positive impact in the Market.

2.3 Vision, Mission, Core values & Objectives of SBL

2.3.1 Vision
To be a modern Bank having the object of building a sound national economy and to
contribute significantly to the Public Exchequer.

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2.3.2Mission
To be the best private commercial bank in Bangladesh in terms of efficiency, capital
adequacy, asset quality, sound management and profitability.

2.3.3. Core Values of Standard Bank Ltd.

 Our shareholder: By ensuring fair return on their investment through

generating stable profit.
 Our customer: To become most caring bank by providing the most courteous
and efficient service in every area of our business.
 Our employee: By promoting the well being of the members of the staff.
 Community: Assuring our socially responsible corporate entity in a tangible
manner through close adherence to national policies and objective.

2.4 Objectives of the bank

The Motto of the Standard Bank limited is to explore a new horizon of innovative
modern banking creating an automated and computerized environment providing
nonstop service and prepare itself to face the new challenges of globalization and 21st
century. The main objectives of Standard Bank Limited are:

To provide high quality products and service to attract its potential market.
To caters to the need of its corporate clients and provides a comprehensive
range of financial services to national and multinational companies.
Act as a media of exchange.
To contribute to gross domestic product.
Maintain a satisfactory deposit mix.
To help to grow entrepreneurship.
Increase loan portfolio diversification and geographical coverage.
To help to solve unemployment problem.
Provide finance and specialized services to the export.
To help to boost economic development.

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2.5 Branches of SBL
From the year 1999 to year 2017 Standard Bank Limited established 68 numbers of
branches in different districts of Bangladesh. The principal Branch located in
Metropolitan Chamber Building (Ground Floor), 122-124 Motijheel C/A, Dhaka
1000, and Bangladesh.

2.6 Organization Offerings:

Standard Bank Limited is always conscious of the changing needs of customers and
strives to develop new and improved services for its valued customers. Ban offers
various deposit and lending products and services to meet all kinds of financial needs
of customers. Such as
 Maintain all types of account.
 Make investment.
 Handle foreign exchange business.
 Intend other banking sector etc.

SBL also collect TITAS bill, WASA bill, Telephone bill and Electricity bill.

2.7 Communication intensity Between Managers, Assistant or the

Work Teams

Communication intensity between managers, assistant or the work team is moderately

high. Or achieving any kind of organization goal, most of the frequently communicate
with each other. They are bound to maintain frequent relationship with each other.

2.8 Functions of SBL

The key function of the organization is as follows
 To mobilize deposits.
 To disburse investments
 To handle foreign exchange and foreign business
 Remittance: To remit money to home and abroad through T.T, D.D, Pay-order,
Travelers cheque, etc.
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  Other services: e.g. Locker service, to receive different types of bills of clients
to issue Guarantees and counseling etc.

2.9 Major Division of SBL

The banking system of Standard Bank Ltd. is divided into three major divisions.
These divisions are –
1) General Banking
2) Advance & Loan Banking
3) Foreign Exchange Banking.

2.9.1 Division of SBL

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2. 10 Management hierarchy of the Standard Bank Ltd.

BRANCH MANAGER

VICE PRESIDENT

2nd OFFICER

SENIOR PRINCIPAL OFFICER

INVESTMENT FOREIGN EX. GENERAL BANKING

DEPARTMENT DEPARTMENT DEPATMENT

EXECUTIVE OFFICER EXECUTIVE OFFICER EXECUTIVE OFFICER

OFFICER OFFICER
OFFICER

JUNIOR OFFICER
JUNIOR
Figure OFFICER
3: Organizational JUNIOR OFFICER
configuration of ever Branch’s, Standard Bank Ltd.

ASSISTANT OFFICER ASSISTANT OFFICER

2. 2. ASSISTANT OFFICER
12 Correspondent Banking Division

TRAINEE ASSISTANT
TRAINEE ASSISTANT TRAINEE ASSISTANT
OFFICER
OFFICER OFFICER

The main aim of Standard bank limited is to increase its foreign exchange business
and in this connection they are doing international banking with all major banks of the
world. At present they are maintaining correspondent banking relationship with 23
major banks of the world. These are:

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The Hong Kong and Shanghai Banking Corporation. Citibank N.A., Standard
Chartered Bank, American Express Bank Ltd., , Wachovia bank, The bank of Tokyo-
Mitsubishi ltd. ,Union De Banques Et Arabs Franchises, ,Dresdner bank, , Nepal
Bangladesh bank ltd., NIB bank ltd. ,Arab Bangladesh bank ltd., AB International
Finance Limited, Bhutan National Bank, UTI bank ltd. ,The bank of Nova Scotia and
ICICI Bank Ltd. Habib bank Ag Zurich, Nordea bank and Samen bank.

Standard bank limited is maintaining drawing arrangement with 1(one) exchange

house in the UK and another 1 (one) in the USA for inward foreign currency
remittance. These 2(two) exchange house are remitting sufficient funds through our
bank. Establishment of some exchange house in the U.A.E. are going to execute very
soon.

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 Chapter-03
Analysis of Evaluations

3.1 About Foreign Exchange

Foreign Exchange Department is an international department of the bank. It deals
with globally and facilitates international trade through its various modes of services.
It bridges between importers and exporters. Bangladesh Bank issues license to
scheduled banks to deal with foreign exchange. These banks are known as Authorized
Dealers. If the branch is authorized dealer in foreign exchange market, it can remit
foreign exchange from local country to foreign country. This department mainly deals
with foreign currency. This is why this department is called foreign exchange
department.

H.E. Evitt defined "Foreign Exchange" as the means and methods by which rights to
wealth expressed in terms of the currency of one country are converted into rights to
wealth in terms of the currency of another country.

Some national and international laws regulate functions of this department. Among
these, Foreign Exchange Act, 1947 is for dealing in foreign exchange business, and
Import and Export Control Act, 1950 is for Documentary Credits. Governments'
Import &Export policy is another important factor for import and export operation of
banks.

3.2 Foreign Exchange Operation of SBL

One of the largest businesses carried out by the commercial bank is foreign trading.
The trade among various countries falls for close link between the parties dealing in
trade. The situation calls for expertise in the field of foreign operations. The bank,
which provides such operation, is referred to as rending international banking
operation. Mainly transactions with overseas countries are respects of import; export
and foreign remittance come under the preview of foreign exchange transactions.
International trade demands a flow of goods from seller to buyer and of payment from
buyer to seller. In this case the bank plays a vital role to bridge between the buyer and
seller.

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In the SBL (Matuil Branch) there are ten peoples working continuously with great
effort and teamwork there are quite efficient skill and talented the above jobs are
performed in foreign exchange department. The Bangladesh Bank and the respected
AVP of this section control them. They believe in teamwork and extreme hard work.

3.3 Foreign exchange department of SBL

Foreign exchange department of SBL is divided into three sections. The sections are:

 Import Department.
 Export department.
 Remittance Department.
Here is the hierarchy of foreign exchange department:

Assistant Vice President

Senior Executive
Officer

Executive Officer Executive Officer (Senior Asst. Officer)

Import L/C &
Export L/C Local/Back to Back Remittance
L/C

Figure: 3 Foreign exchange department of SBL

3.4 Import Department:

Import L/C is handled by Mrs. khodeza Begum (Senior Asst. officer). When L/C
conies from the applicant, he checks all the terms& condition of the L/C & also check
the validity of the L/C. L/C may comes from SWIFT/ TELEX. Each of them creates
different charges for the clients. L/C can be deferred or at sight.

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 In brief the import process:

Figure: 4. The import process

3.5 Steps in an Import Letter of Credit Transaction:

The Sales Contract

The sales contract is the formal agreement between the buyer and seller specifying the
terms of sale that both parties have agreed upon. The contract should include: a
description of the goods; the amount; the unit price; the terms of delivery; the time
allowed for shipment and presentation of documents; the currency; and the method of
payment.
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Application & Agreement

The bank's letter of Credit application and agreement forms, when executed,
constitute a payment and reimbursement contract between the issuing bank and its
customer. It is also the customer's instruction to the issuing bank. The letter of Credit
must be issued exactly in accordance with the customer's instructions; therefore, it is
important that the application be completed fully and accurately, so as to avoid the
inconvenience of having to have the letter of Credit amended. The agreement
constitutes an undertaking by the customer to reimburse the issuing bank for drawings
paid in accordance with the terms of the letter of Credit and normally takes the form
of an authorization to debit the customer's account.

An importer will request banker to open L/C along with the following documents.

 An application
 Indent or Pro forma Invoice
 Import Registration Certificate (IRC)
 Taxpayer's Identification Number (TIN)
 Insurance cover note with money receipt
 A bank account in SBL.
 Membership of chamber of commerce

3.6 L/C Application Form (LCAF):

L/C Application Form is a sort of an agreement between customer and bank on the
basis of which letter of credit is opened SBL; Main Branch provides a printed form
for opening of L/C to the importer. Special adhesive stamp of value Tk. 150.00 is
affixed on the form in accordance with Stamp Act. While opening, the stamp is
cancelled. Usually the importer expresses his decision to open the L/C quoting the
amount of margin in percentage.

Usually the importer gives the following information:

 Full name and address of the importer

 Full name and address of the beneficiary
 Draft amount
 Availability of the credit by sight payment/acceptance/negotiation/deferred
payment
 Time bar within which the documents should be presented
 Sales type (CIF/FOB/C&F)
 Brief specification of commodities, price, quantity, indent no. etc.

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  Country of origin
 Bangladesh Bank registration number
 Import License/LCAF number
 IRC number
 Account number
 Documents number
 Insurance Cover Note / Policy number, date, amount
 Name and address of Insurance Company
 Whether the partial shipment is allowed or not
 Whether the transshipment is allowed or not
 Last date of shipment
 Last date of negotiation
 Other terms and conditions (if any)
 Whether the confirmation of the credit is requested by the beneficiary or not.
 The L/C application must be completed/filled in properly and signed by the
authorized person of the importer before it is submitted to the issuing bank.

3.7 Issuance of the letter of Credit

The issuing bank prepares the letter of Credit as specified in the application and
forwards it by tele-transmission or airmail to the advising bank, (a branch or
correspondent of the issuing bank). The issuing bank instructs the advising bank as to
whether or not to add its confirmation, as per their customer's instructions.

3.8 Advising
The advising bank forwards the letter of Credit to the beneficiary (seller) stating that
no commitment is conveyed on its part. However, if the advising bank has been asked
to confirm the letter of Credit and agrees to do so, it will incorporate a clause
undertaking to honor the beneficiary's drafts, provided the documents evidence that
all terms and conditions of the letter of Credit have been complied with.

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 Sale Contact

L/C Application
Advice of L/C

Request to advice
& if applicable
confirm L/C

Figure: 5 L/C advising process

3.9 Local or Back to Back L/C:

Local or Back to back L/C is handled by Kh. Kobiul Islam. At first we have to
understand what is Back to Back or Local L/C. If the Exporter Exports the garments
products as shirt, then he have to also purchase the bottom, logo, tag, yearn etc for the
shirt. And in this case, if the exporters have not enough money to purchase that, then
the Bank help the exporter to purchase the accessories by lien the L/C. 75% of master
L/C can be a lien as Back to Back L/C. 100% of master L/C cannot be the Back to
Back L/C because, there will be no profit if 100% value is used in purchasing raw
material. So here 25% is the profit of the exporter or to perform the other maintenance
costs, Labor costs etc. There are 4 parties in Back to Back L/C.

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 Opening/ Issuing Bank Negotiation or Advising
(SBL) Bank (EXIM)

Applicant Beneficiary
(Pharmaceutical) (Accessories Co.)

Figure: 6 Parties Back to back L/C

The Diagram says that, the applicant give order to purchase accessories to the
Beneficiary through Standard Bank, SBL open the L/C and send it to the Beneficiary's
negotiating bank. After receiving the raw materials, applicant makes payment to the
Negotiate bank through opening bank. The beneficiary receives the payment from the
Negotiate bank. Another term in case of Local/Back to Back L/C is "Purchase".
Purchasing of L/C means that, the local L/C can be lien to bank & take the payment
before expire date of the L/C. The Exporter when open an L/C to purchase the raw
materials, then the Exporter becomes the applicant in that case & the supplier of the
raw materials becomes the beneficiary. The L/C has an expire date with in which the
beneficiary have to supply the products to the applicant. And after receiving the
products, the applicant makes payment to the beneficiary. The beneficiary can get the
L/C value before the L/C expire date through purchasing the back to back L/C. Here
Bank purchases the 75% to 95% of total L/C value. Here Bank cuts some charges like,
advising charge, postage charge etc. When the purchase amount is below $10,000
then the total charge is BDT 675, and when the purchase amount is above $10,000
then the total charge is BDT 1200.

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The total process of Back to Back L/C from opening to purchasing is given below:

Figure: 7 Back to Back L/C process

3.10 Export Department:

Md. Monirul Islam is in export L/C section. Mainly L/C is the confirming from the
Bank that, if the importer fails to make payment to the exporter, then the bank will
pay the exporter on behalf of the importer. The exporter can lien the L/C to bank and
can get the payment before the L/C expire date. Here the bank cuts charges for it, and
that is the bank profit. The step that Md. Monirul Islam follows to handle the export
L/Cs are:

Figure: 8 Export L/C process

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3.11 Trend Analysis:
Trend analysis is an important tool, which can be used to evaluate the performance of
a Bank. The trend can represent the growth or turn down of a bank over a period of
time. Here analyzed the different term which is related to the foreign exchange
business of SBL.

Foreign exchange department of SBL is consisting of three sections. The sections

are:

3.11.1 Import Department:

3.11.1 Earning from Import Business:
Table: 2 Earning from Import Business of SBL.
Year Amount in Tk (million)
2013 214.63
2014 375.34
2015 354.22
2016 562.09
2017 745.39

Source: Foreign Exchange Department of SBL

Graphical presentation:

Figure (01) Earning from Import Business of SBL

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Interpretation:
The graph represent the earning from import has increased. In 2015 the bank made a lower
Import business than 2014 because of economic recession. As a result slightly lower income
than 2014 but not unsatisfied level. Despite, in 2016 the bank made a huge income from
Import. It was the highest income during the last four years.But in 2017 the income is
gradually increase in ascending way and it’s becoming the highest income during the last five
years.

3.11.2 Amount of Total Import Business:

Table: 3 Import Amount of Standard Bank Ltd.
Year Amount in BDT (million)
2013 26155
2014 35689
2015 40411
2016 56167
2017 50497
Source: Annual Report of SBL (2013-2017)

Graphical presentation:

Figure: 02 Total Import Amount of SBL.

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Interpretation:
The graph shows that the Import business of SBL increased from year 2013 to 2016.
Because of economic recession import business slightly increased in 2015 than 2014
the bank earned highest amount (Tk56167 million) in 2016.
3.11.3 Import Earning Growth Rate:
Table: 4 Import Earning Growth Rate
Year Growth Rate
2014 74.87%
2015 -5.62%
2016 58.68%
2017 32.61%
Source: Foreign Exchange Department of SBL

Graphical presentation:

Figure: 03 Import Earning Growth Rate of SBL

Interpretation:
From the above graph it can be interpreted that, the growth rate of import earning was
better in 2014. Although the bank made a huge business in 2015 but lost the
percentage of income so the growth rate shows negative sign. In 2015 sector was very
badly affected due to economic recession. In 2016 the bank made a good growth that
is 58.68%.But in 2017 the growth rate is fall by 26.07% compared to year of 2016 and
in 2017 growth rate reached to 32.61%.

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3.11.4 Portion of Import Income on Total Income:
Table: 5 Portion of Import Income on Total Income
Year Import earnings Total Income Earning
(Tk. in millions) (Tk. in millions) percentage of
Import
2013 214.63 2798 7.67%
2014 375.34 4165 9.01%
2015 354.22 5546 6.38%
2016 562.09 7795 7.21%
2017 745.39 9893 7.53%
Source: Foreign Exchange Department of SBL

Graphical presentation:

Figure: 04 Portion of Import Income on Total Income

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Interpretation: The graph shows that the Import income consistently a stable
contribution on total income though during the last four years. But in 2015 it was
lowest for the economic great fall. In 2014 the contribution was highest.

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6.11.5 Export Department:
6.3.1 Earning from Export Business:
Table: 6 Earning from Export Business of SBL.
Year Amount in BDT (million)
2013 118.83
2014 217.87
2015 247.59
2016 444.87
2017 614.96
Source: Foreign Exchange Department of SBL

Graphical presentation:

Figure: 05 Earning from Export Business SBL

Interpretation:
From the graph, it is interpreted that the income from the export of SBL has increased
from the year of 2013 to 2017 because of the increasing of export business. The
income of export is highest in 2017 (Tk.614.96 million) where the income was only
Tk. 118.83 million in 2013.

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3.11.2 Amount of Total Export Business:
Table: 7 Export Amount of Standard Bank Ltd.
Year Amount in BDT (million)
2013 17788
2014 25072
2015 29177
2016 41919
2017 45356
Source: Annual Report of SBL (2013-2017)

Graphical presentation:

Figure: 06 Export Amount of SBL.

Interpretation:
The graph shows that the Export business of SBL gradually increased from year 2013
to 2017 and the highest business of export of the bank was in the year of 2016
because the bank has increased their export client year by year.

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3.11.3 Export Earnings Growth Rate:
Table: 8 Export Earnings Growth Rate
Year Growth Rate
2014 83.34%
2015 13.64%
2016 79.68%
2017 38.23%
Source: Foreign Exchange Department of SBL
Graphical presentation:

Figure: 07 Export Earnings Growth Rate of SBL

Interpretation:
Although the export business and the export earning gradually increased in every year
but the earnings growth was not in the same pace. The graph shows that from the year
2015 to 2016 growth rates were remarkable but fall in 2014. In 2015 the word
economy faced great recession after 1934. Bangladeshi bank industry also was
affected by the recession. In 2016 again the earning was in the increasing trend which
is near 80%,But In 2017 again the growth rate fall . That means the growth rate was
fluctuated in last four years.

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3.11.4 Portion of Export Income on Total Income:
Table:9 Portion of Export Income on Total Income
Year Export earnings Total Income Earning
(Tk. in millions) (Tk. in millions) percentage of
Export
2013 118.83 2798 4.24%
2014 217.87 4165 5.23%
2015 247.59 5546 4.46%
2016 444.87 7795 5.70%
2017 614.96 9196 6.69%
Source: Foreign Exchange Department of SBL

Graphical presentation:

Figure: 08 Portion of Export Income on Total Income

Interpretation:

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Above graph shows that the portion of export earning has increased but in 2015
slightly decreased for the economic recession. In 2017 export earning contribute the
maximum amount during the last four years.

27
3.11.5 Earning from Foreign Remittance:
Table: 10 Earning from Foreign Remittance of SBL.
Year Amount in BDT (million)
2013 36.15
2014 78.6
2015 89.77
2016 58.61
2017 73.49
Source: Foreign Exchange Department of SBL
Graphical presentation:

Figure: 09 Earning from Foreign Remittance of SBL

Interpretation:
The impact of the fluctuation of foreign remittance business affects the earning of
foreign remittance income. The income from foreign remittance also fluctuated like
the foreign remittance business. The income has fallen in 2016. It was the impacts of
great economic fall in 2015.Its bit by bit recover in 2017.

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3.11.6 Amount of Foreign Remittance of SBL :
Table: 11 Amount of Foreign Remittance.
Year Amount in BDT (million)
2013 411
2014 830
2015 697
2016 1044
2017 2815
Source: Annual Report of SBL (2013-2017)
Graphical presentation:

Figure: 10 Foreign Remittance Amount of SBL

Interpretation:
The foreign remittance performance of SBL was not satisfactory in 2015&2013. The
remittance was increased in 2014&2016. But remarkable improvement was shown in
during the last four years of 2017.

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30
3.11.7 Foreign Remittance Earnings Growth Rate:
Table: 12 Foreign Remittance Earnings Growth Rate
Year Growth Rate
2014 117.42%
2015 14.21%
2016 -34.71%
2017 25.38%
Source: Foreign Exchange Department of SBL

Graphical presentation:

Figure: 11 Foreign Remittance Earnings Growth Rate

Interpretation:
From the graph, it is interpreted that SBL didn’t stay a well position after 2014. The
income of remittance has huge grown in 2017. From 2014 to before 2016 the
remittance growth rate was sequentially declined and it was badly affected in 2016.but
in 2017 the growth rate was recovered and bit by bit it increases.

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3.11.8 Portion of Remittance Income on Total Income:
Table: 13 Portion of Remittance Income on Total Income
Year Remittance earnings Total Income Earning percentage
(Tk. in millions) (Tk. in millions) of Foreign
Remittance
2013 36.15 2798 1.29%
2014 78.6 4165 1.89%
2015 89.77 5546 1.62%
2016 58.61 7795 0.75%
2017 73.49 8648 0.85%
Source: Foreign Exchange Department of SBL
Graphical presentation:

Figure: 12 Portion of Remittance Income on Total Income

Interpretation:
The percentage of foreign remittance income on the total income lowest in 2016
because of the economic recession affected the word economic foreign exchange

32
business in 2015. During 2013 to 2015 it has fluctuated from 1.29% to 1.62%.In 2017
it was increase compared to 2016 from 0.75% to 0.85%.

33
11.3.9 Total earning from Foreign Exchange:
Here the table shows the last five years earning of Foreign Exchange department of
Standard Bank Ltd.
Table: 14 Total earning of Foreign Exchange department of SBL.
Particulars 2013 % of 2014 % of 2015 % of 2016 % of 2017 % of
total total total total total F.ex
F.ex F.ex F.ex F.ex
(Tk. (Tk. (Tk. (Tk. mln) (Tk. mln)
mln) mln) mln)
Import 214.63 58.07% 375.34 55.87% 354.22 51.22% 562.09 52.75% 745.39 51.99%

Export 118.83 32.15% 217.87 32.43% 247.59 35.80% 444.87 41.75% 614.96 42.89%

Foreign 36.15 9.78% 78.6 11.70% 89.77 12.98% 58.61 5.50% 73.49 5.12%
Remittance
Total F Ex 369.61 100% 671.81 100% 691.58 100% 1065.57 100% 1433.84 100%
earning

Interpretation:
The table shows that the most portion of foreign exchange income comes from the
import income. In every year the import income was over 50%. It was slightly
fluctuate in every year but not below 50%. The second portion of foreign exchange
income comes from the export business. It has increased in every year. In 2013 it was
32.15% which increased in 2017 to 42.89%. Rest of the portion of income comes
from the foreign remittance. It was the lowest part of income. This income fluctuates
in every year. It has fluctuated from 5.12% to13%. But in 2017 represent the lowest
foreign remittance income during the last five year. In 2017 it was decreased by
5.12% compared to 2016.Total income also increased year by year.

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3.11.8 Table: 15 Portion of Foreign Exchange earnings on Total Income
Year Foreign Exchange Total Income Earning
earnings (Tk. in millions) percentage of
(Tk. in millions) Foreign Exchange
2013 369.61 2798 13.21%
2014 671.81 4165 16.13%
2015 691.58 5546 12.47%
2016 1065.57 7795 13.67%
2017 1433.84 8648 16.58%
Source: Foreign Exchange Department of SBL

Graphical Presentation:

Figure: 13 Portion of Foreign Exchange earnings on Total Income

Interpretation:
The table represents the total income and the percentage of foreign exchange income
on the total income 2013 to 2017. The percentage fluctuated nearly 13% to 16%
during last four years.

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3.11.9 Table: 16 Percentage of Foreign Exchange earnings on Total Income
Year Foreign Exchange Total Income Earning
earnings (Tk. in millions) percentage of
(Tk. in millions) Foreign Exchange
2013 369.61 2798 13.21%
2014 671.81 4165 16.13%
2015 691.58 5546 12.47%
2016 1065.57 7795 13.67%
2017 1433.84 8648 16.58%
Source: Foreign Exchange Department of SBL

Graphical Presentation:

Figure: 14 Percentage earnings of Foreign Exchange on Total Income

Interpretation:
The percentage earning of foreign exchange to total income fluctuates between 13%
from 16%. In 2013 it was 13.21% in 2014 it increased to 16.13% again decrease to
12.47% in 2015. In the year of 2016 it was 13.67%.But in the last year it was 16.58%
which is highest among the last five years. It fluctuated because bank didn’t earn same
amount from foreign exchange business in every year.

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3.11.10 Foreign Exchange income in 2017:
Table: 17 Percentage of Foreign Exchange incomes in 2017
Import Export Remittance
52% 43% 5%
Source: Annual Report of SBL 2017

Graphical Presentation:

Source: Annual Report of SBL 2017

Figure: 15 Foreign Exchange Earnings in 2017.
Interpretation:
The largest portion of foreign exchange earnings comes from import business. The
earnings of import business is 52%& 42% comes from export business and lower
portion only 5% comes from remittance business.

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3.11.11 Country wise Inflow of Foreign Remittance of SBL:
Standard Bank Ltd received foreign remittance from different countries. SBL received
highest remittance 39% from Kingdom of Saudi Arab.
Graphical Presentation:

Source: Foreign Exchange Dept. of SBL

Figure 16: Country wise Inflow of Foreign Remittance, 2017
Interpretation:
Above diagram mentioned the percentage of foreign remittance inflow of SBL from
different country. The diagram shows that the highest foreign remittance inflow
earned from Kingdom of
Saudi Arab, 39%. The second highest foreign remittance inflow earned from USA,
23%. UK , UAE& Italy have also good contribution in the remittance

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 Chapter-04
Findings, Recommendations & Conclusions

4.1 Major Findings:

Standard Bank is in a better position in respect of import business because the
import business increased gradually every year. As a result the income from
import business also increased every year except 2015.
The export business has increased every year during last five years. As a result
the income from export also increased during the year of 2013-2017.
The remittance business didn’t show the same scenario like import and export.
It fluctuates in last five years. Standard Bank made huge business in 2014 but
reduced in 2015. It has an impact on foreign exchange earnings..
Import business is the main source of income of foreign exchange business of
Standard Bank. Above 50% foreign exchange earned from import in every
year.
All branches of SBL have online facilities for transaction. So it is very helpful
for the clients to deal with the Banking activities.
As per Bangladesh Bank requirement Torn & Soiled Note Exchange poster
should be displayed in a visible place of the branch but in Mirpur Road Branch
there is not any such poster.
In the Service Quality Handbook, it is clearly written that guest waiting areas
should be provided with newspapers, magazines and periodicals. But the guest
waiting areas are never provided with newspapers, magazines or periodicals.
SBL decision making is highly centralized.

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4.2 Recommendations:
From the practical exposure of Standard Bank Limited at Matuil Branch for just three
months. It is not so easy to recommend some suggestions to enhance the performance
level of the organization. On the basis of observation following recommendations are
made.
1. The Bank should give more concentration of foreign remittance to increase
profit from the remittance. Though the remittance performance of SBL for the
last year was very bad so the performance and profit should be increase year
by year.
2. Though the import and export business increased year by year, but the bank’s
income growth rate very much fluctuated during the last four years except year
of 2016-2017. So the bank should try to sustain a constant growth rate.
3. The export business of the bank is on an increasing trend. So the bank should
try to keep the pace of growth.
4. In over all foreign exchange earnings, remittance contributes a small portion
only 10-13%. More than 50% comes from import business. Bank should try to
increase earning from export and remittance. It should concentrate more effort
to improve export earnings and remittance earnings for our economy.
5. L/C processing system should be easy with the bank.
6. Up to date banking software should be used to give better service to the
customers
7. The bank should maintain reasonable margin limit for credit.

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4.3 Conclusion:
Standard Bank limited is a leading Private bank in Bangladesh with superior
customer bases that are loyal, faithful, worthy towards the bank. The service provided
by the young energetic officials of the Standard Bank Limited is very satisfactory.
During my internship in Matuil Branch I have found its Foreign Exchange department
to be very efficient; therefore this department plays a major role in the overall
profitability of the branch and to the Bank as a whole. . It has a large portfolio with
huge assets to meet up its liabilities and the management of this bank is equipped with
the expert bankers and managers in all level of management. I would rather feel like
producing my personal opinion about the ongoing practices in Matuil Branch.
Standard bank limited is a new generation bank. It is committed to provide high
quality financial service to contribute to the growth of G.D.P. of the country through
simulation trade & 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.
I have tried my best to learn, enrich my knowledge, discover and overcome my
limitations and adjust with the professional environment. It is not possible to
recognize and identify all the process and procedure of banking within short time.
This experience of sharing works with such working environment will help me a lot in
my professional life.

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Reference
References in the text:

 Lawrence, J Gitman (2003), “Principle of Managerial Finance”, 10th edition,

Pearson Education Pte. Ltd, Singapore.
 C.R Kotheri, “Research Methodology” Second Edition, 2003-2004, Wishwa
Prakashan, Calcutta, India.
 Chowdhury, L.R., “A Text Book on Foreign Exchange” Fair Corporation,
Dhaka, 2000
 Frederic S. Miskhin, “The Economics of Money Banking & Financial Market”
Sixth Edition, 2003, Boston
 Hai, M. Enamul (January 1996), “Bank Management” Jane Publishers”.

Reports and publications:

 Bedi, H.L. “Practical Banking Advances” UBS Publishers Distributions Ltd.
New Delhi.
 Annual report 2013-2017, Standard Bank Ltd. (Online)

Referencing from the Internet:

 Consolidated Schedule of Charges/Commissions on Foreign Exchange Business
Transactions/Services. Access date 12/11/2018
 Statement for Foreign Exchange Transaction 2013-2017, Standard Bank Ltd. Access
date 12/11/2018
 Websites of Bangladesh Bank. Access date 14/11/2018

 Website of Standard Bank Limited. http://www.Standardbankbd.com. Access date

14/11/2018

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