Overall Performance of Consumer Banking Services of Standard Bank Limited
E XE C UTI VE S UMMAR Y An internship program is arranged to bridge the gap between theory and practice. Without theoretical knowledge practice can not yield expected results. On the other hand, without practical knowledge theoretical one has no meaning. Realizing these. When I join as internee in Standard Bank Limited This program designed to nourish our confidence and to develop my consistency. I joined to the SBL Green Road Branch on 11.10.2010 .I got about three months to gather practical knowledge from this SBL House, although it was too short to gather maximum. The report is like an abstract of all that I have learned during the practical period. I have tried my best to make this report meaningful. I hope that this report would be able to portray the overall achievement of my internship program. In this report I want to present the overall situation of the SBL condition, Objective of SBL, the strategy also. In this report I want to present my experience that I learnt like the product of SBL & also their interest rate , their way of processing, Rules Etc And Also try to present the limitation & benefit & findings of working SBL ..I have tried in my best to study the materials related with our topic and observed Consumer Banking Service . CHAPTER 01 INTRODUCTION 1.1Introduction: SBL, due to its strong progress and well supported consumer banking for the people has a established good position in banking sector in Bangladesh . Among its various products one of the key products is the personal loan for consumers. In the undertaken study the different features of the product as well as its benefits and downsides
have been assessed. In addition to that the loan utilization aspect as well as modifications has also been proposed. Briefly speaking “An overall performance of consumer banking services of SBL ”. While the overall bank performance of consumer banking services will be described on a much larger scale. 1.2Objective of the Report: • • • •
Identify the strategies for SBL implementing in constant prosperity of the company. Analyzing the performance trends of the fast growing banking corporation. To find out the management problems and solve the problems. Finding out the key issues that work barriers while providing services to its customers. • Finding out what are the facilities provided by SBL to its clients and how they perceived those. • To identify the problem faced by SBL. • To give some idea about its management and organization structure. • To develop the capabilities as an employee in realistic field of the job market. 1.3 Scope of the Study: The scope of the report is based on the author’s personal experience as an intern at SBL House, Green road branch during the period 11October,2010 to 27 January’ 2011. Being a student of Human resource management it appeared more interesting to make a comprehensive study on Consumer service process, How to face with customer, Idea of all product of SBL, Their Direct Sales Executives, recruitment process, maintaining loan process etc 1.4 Purpose of the study: The internship report aims to analyze the performance of this Bank in comparison to others in every sector and in particularly the consumer product of Standard Bank Ltd and suggest ways to make improvements in the current practices & also understand the office environment. 1.5 Limitation: Some limitations had been faced in the completion of the report which was: • •
• •
The bank’s policy of not disclosing some data and information for obvious reasons, which would have been very much useful for the report. Confidentiality of data was another important barrier that was faced during the conduct of the study. Every organization has its own secrecy that cannot be revealed in publics. Lack of sufficient data regarding customer usage of the loan amount also posed a serious problem in assessing the portfolio performance. Since the time allocated for internship program is twelve weeks, it may have a coercive effect on this study lowering the actual value and standard.
CHAPTER 02 BACKGROUND 2.1History 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. The Bank had been widely acclaimed by the business community, from small entrepreneur to large traders and industrial conglomerates, including the top rated corporate borrowers for forward-looking business outlook and innovative financing solutions. Thus within this very short period of time it has been able to create an image for itself and has earned significant reputation in the country’s banking sector as setting a new standard in banking. Presently it has fifty nine branches in operation. The emergence of Standard Bank Limited at the junction of liberation of global economic activities, after the WTO has been an important event in the financial sector of Bangladesh. The experience of the prosperous economies of Asian countries and in particular of South Asia has been the driving force and the strategies behind operational policy option of the Bank. The Company Philosophy – “Setting a New Standard in Banking” has been preciously the essence of the legend of bank’s success. Standard Bank Limited has been licensed by the Government of Bangladesh as a Scheduled Bank in the private sector in pursuance of the policy of liberalization of banking and financial services and facilities in Bangladesh. In view of the above, the Bank within a period of 12 years of its operation achieved a remarkable success and met up capital adequacy requirement of Bangladesh Bank It has been growing faster as one of the leaders of the new generation banks in the private sector in respect of business and profitability as it is evident from the financial statement for the last 5 years. 2.2Principles & Values
SBL Principles Leading by example to be the right partner for its stakeholders, the bank is committed to building a sustainable business over the long term that is trusted worldwide for upholding high standards of corporate governance, social responsibility, environmental protection and employee diversity. It employs over 1873 people . SBL stand for • Strategic intent> To be the Bangladesh’s best private Bank > Leading the every corner of Bangladesh • Brand promise> Setting a new standard in Banking • SBL Values >Courageous - A commitment to being there for customers, in good times and bad. They help customers achieve their aspirations by guiding them towards the right choice, not just the easy one. > Responsive- Standard Bank Ltd is good on their word. They are accessible whenever and wherever the customers need them. Not only do they strive to deliver solutions, they also aim to exceed customers’ expectation. >Creative- Creative thinkers are not limited by convention. They allow their minds to soar beyond predictable solutions. That’s how Standard Bank approaches each challenge posed to the bank, which is why they base their products and services on ideas that are innovative, perceptive and instinctive. >Trustworthy- They respect the customers, and the life customers live. By understanding customers’ needs and tailoring the right financial solutions for customers, they earn Standard Bank’s trust. 2.3 Approach of SBL: Participation :Focusing on attractive, growing markets where we can leverage our relationships and expertise Competitive positioning :Combining the highest capability, deep local knowledge and creativity to outperform our competitors. Management Discipline >>> Continuously improving the way we work, balancing the pursuit of growth with firm control of costs and risks Customers >>>>>>>>>>> Passionate about our customers' success, delighting them with the quality of our service Our People >>>>>>>>>>>
Helping our people to grow, enabling individuals to make a difference and teams to win. Communities >>>>>>>>> Trusted and caring, dedicated to making a difference. Investors >>>>>>>>>>> A distinctive investment delivering outstanding performance and superior returns Regulators >>>>>> Exemplary governance and ethics wherever we are offering. 2.6 Categories of Services Provided: Consumer Banking: Comprehensive Consumer banking service offer through 59 branches in Dhaka, Chittagong, and Sylhet, the three largest urban centers. ATM networks, Phone Banking Services, and sms banking services are also available. Corporate Banking: Corporate banking offers a wide range of trade related services and lending to local and foreign corporate entities. Treasury: The treasury operation in Bangladesh participates in foreign currency dealing and money market operations. P riority Banking: Priority Banking customer have the advantage of enjoying customized benefits that recognize relationship with us and have been tailored to suit your individual needs. And because we know they mean the world, some of these benefits also extend to family. Just like you, they will also enjoy the perks of banking with us, from designated tellers and dedicated hotlines to exclusive lifestyle privileges and rewards.
Figure: The Relationship between Respective Customers to Different Departments of SBL.
Individual
Organization
Companies
Consumer Banking
Banks and other Financial Institutions
Corporate & Institutional Banking
Treasury
This is focus allows the business to develop an in-depth understanding of the banks customer’s evolving requirements. This in turn enables us to develop the products and services that help SBL stand out from the competition. Treasury provides support to the customers of both these business and develops customers (both individual and organizational) its own. 2.7 SBL’s Objectives: Based on their mission and vision, Standard Bank Ltd has come up with few objectives, which they believe will help them reach their desired destination. They are: Gaining a larger market share:
Standard Bank currently has a quite low market share of less than 6%. They want to increase their market share in the coming years. Provide technologically advanced services: SBL want to provide technologically advanced services for the convenience of their customers. Now they have introduced Phone-banking and sms banking. Making banking comfortable and convenient for customers : SBL wants to retain their customers by making customers feel comfortable while they are at the banking premises. For this reason they have arranged for adequate seating facilities. Ensuring customer satisfaction: Standard Bank has made use of different means of getting feedback from customers so as to understand their level of satisfaction, based on which they can take the necessary actions to ensure customer satisfaction. 2.8 SBL’s Strategies: SBL believes in the practice of Market –Oriented Strategies Planning, developing and maintaining a viable fit between the organization’s objectives, skills and resources. The aim of such approach is to shape and reshape the bank’s businesses and services so that they yield target profits and growth. The strategic planning of SBL involves repeated cycles of corporate and business planning of SBL consists of two organizational levels, which are Location Based Strategy Business Level Strategy Location Based Strategy: Since the growth and profits of banking largely depend upon the locations if branches where large concentration of other businesses and industries are involved, SBL primarily focuses on location- based strategy. Every year an overall profit target as well as individual targets for each line of business (export, import, loans & advances etc) is set for each branch location by the corporate bodies in collaboration with the regional heads and branch managers. The 59 branches of SBL are divided into three different regions, which are: Dhaka Division, comprising many branches of Dhaka city, Those are Gulshan
Dhanmondi Banani Mirpur Islampur Uttara Green Road Panthopath Ring Road Savar Chittagong Division, comprising many branches of Chittagong , Those are a) Agrabad b) Jublee Road Sylhet and Moulavi Bazar Khulna Division, comprising 1 branch in Khulna Bogra Division , Comprising 1 branch in Bogra The concentration of businesses and lifestyles of the people are not same in these three areas. So, the strategies of the three areas differ from one another; but they are designed with distinctive local touch. The branches Control & Inspection Division at the Head Office constantly monitors the progresses of all the three areas and works along with Marketing and Outreach Division for search for new location. 2.9 The organogram of the Standard Bank Limited operation is depicted in the following figure: Figure: Organizational Organ gram.
Chief Executive Officer
Support Manager to CEO
Head of Corporate and Institutions
Head of Consumer Banking
Head of Treasury
Head of Institutional Banking
Head of Finance & Admin.
Head of Human Resource Dept.
Senior Credit Officer
Head of Legal & Compliance
Head of GSAM
Chief Operating Officer
Head of Information Technology
Head of External Affairs
Source: Human Resource Department of Standard Bank Ltd There are two types of services provided by the SBL: Business or Corporate Financial Services Retail or Consumer financial Services But these two services can be classified further by the following ways: Banking Services of Standard Bank
Services: Services: Corporate Banking
Product: ■ Trade Finance ■ Letter of Credit ■ Bid/ Performance Bonds ■ Working Capital Loans ■ Money Transfer/ Remittances
CHAPTER 03 BANK PRODUCT (ASSETS) 3.1 Personal Loan:
■■ Merchant Personal Consumer Banking Banking Banking ■■ Commercial Consumer Banking Finance ■ Credit Cards
Product: ■ Investment Management ■ Wage Earner’s Scheme
■ Lockers ■ Deposit Services ■ Deposit Products ■ Credit Cards
Services: Services: ■Correspondent Inter■Bank Operation of Transaction Accounts Banking over Phone
Product: ■ Cheque Purchase ■ Guarantee ■ Risk Exposure
Phone Banking
Product: ■ Account Balance ■ Fund Transfer
Personal Loans from Standard Bank are the most flexible of their kind in the market. Unlike the conventional banking at Standard bank, you do not need to provide any cash security to avail Personal Loan from SBL. A very flexible Personal Loan - to meet your assorted needs like: Purchase of miscellaneous household appliances Purchase of personal computers Purchase of refrigerator Purchase of audio-video equipment Purchase of furniture Hospitalizations or other emergency medical needs House renovation Purchase of office equipment / accessories Office renovation Marriages in family Advance rent payment Overseas trips Processing 1% or BDT 1,000 whichever is higher.
Fee:
3.5 Cash line A product that offers you the best of both worlds, permitting ready access to cash without disrupting interest-earnings on fixed investments. It provides ready access to cash against quasi-cash investment papers like Terms Deposits, Savings Certificates, Wage Earners' Development Bonds, ICB Units certificates etc.). Other features: Both Revolving & terminating options High utilization Limit (based on security value) Quarterly payment of Interest (only on the outstanding amount)
No commitment fee (on unused limit) 3.6 Mortgage Loan Standard Bank Mortgage Home Loan
The
Home
Loan
Loan amount includes registration cost No cash security No personal guarantee from third party Interest calculated on Monthly Reducing Balance Everyone dreams of a sweet home. And this dream comes true with a little effort. Standard Bank is ready to help you in this effort so that your dream comes true. Be it your first home or renovating/refinancing your existing one, or a second one, you can avail our Mortgage Home Loan? The best home loan in town. Standard Bank Mortgage offers you Competitive interest rate with no hidden cost. Interest calculated on a monthly reducing balance, which enables you to save money in your installment amount Simple & easy documentation No personal guarantee from third party and no additional cash security Flexible loan amount Refinancing Financing includes registration cost Partial or full prepayment options Loan approval within the shortest possible time Who can apply? Profession: Applicant should have at least three years of service/ professional/ business track records Minimum Age: 30 years Maximum Age: Retirement age or 60 years less loan term, whichever is earlier Proposed Property: Any leasehold residential property including purchase of second hand property Flexible Loan Amount
Maximum Loan: Maximum 70% of the property Minimum Loan: BDT 1,000,000 Easy Terms and Repayment Option
BDT value
7,500,000 (including registration
cost)
Maximum loan term up to 15 years Repayment: Loan will be repaid by equal monthly installment (EMI) and the installment is calculated on monthly reducing method with no additional hidden interest or charges Convenient Security Registered mortgage of the property or any other equivalent property in favor of Standard Bank. Processing Fees Loan Processing Fees: Documentation Fees:
0.25% 1%
of of
the the
loan loan
amount amount
Home Loan>>>>> Standard Bank Home Loan provides attractive financing for a new house or an apartment. You can also avail our Home Loan for renovation, facelift, extension and furnishing work in your existing house or apartment. Special benefits Very attractive variable interest rates No personal guarantee or cash security required No prior account relationship required with Standard Bank Early settlement and partial prepayment options Loans against land value if building plan is approved by Rajuk or similar authorities Option to avail home loan in installments, based on the amount of down payment arranged at every step Option to pay only interest during construction period Exclusive features Professional Experience: At least three years of service/ professional/ business track records
Income: Minimum monthly income of BDT 25,000 Minimum Age: 25 years Maximum Age: 65 years at the end of the loan tenure or retirement age for service holders (whichever is earlier). Proposed Property: Any property on leasehold / freehold / private land in Dhaka & Chittagong metropolitan areas. Security Registered mortgage in favor of Standard Bank, or equivalent securitization under Tripartite Agreement or Four party agreement Mortgage Reducing Term Assurance (MRTA) Our Home Loan comes with a very attractive credit-life insurance bundle scheme called Mortgage Reducing Term Assurance (MRTA). The insurance coverage is provided by one of the best life insurance companies around. Moreover, we are financing the insurance premium along with your home loan. MRTA insures your Home Loan against your death or permanent total disability, relieving you and your family of the burden of the loan in the event of any such unforeseen circumstances. Your dream home will be there for your family, forever. Apply for a Home Loan with MRTA and enjoy the following special interest rates Standard Bank now offers the best interest rates in the market for home loans, bundled with MRTA. The interest rates are variable, and will be reviewed on a 6 monthly basis (after loan disbursement), based on 182-Day Government Treasury Bill rates. The interest rates are as follows: Loan Type Home Loan (for purchase of a new home) Takeover Loan (transfer of your loan from any other bank/FI) Home Credit (for renovation / extension of your home)
Interest Rate (p.a.) 9.5 % 9.5 % 10.49 %
Above interest rates are as on 1 January 2011; interest rates are subject to change without prior notice. Processing Fees Loan Processing Fee: 1.5% of the loan amount + 15% VAT on processing fee
3.7 Business Installment Loan (BIL) Do not let fund shortage hold back your business expansion. Fight back all fund related constrains with Standard Bank’s Business Installment Loan. Inject up to BDT 7 Million to truly make your business fly! Features This loan will help you meet your financial needs for your business expansion. You can make long term investments with this business loan and build up your equity by repaying the loan in convenient equated monthly installments (EMI). You can avail this loan through some simple documentation and against competitive cash securities. Maximum Loan: BDT 7,000,000 (Seventy Lacks) only Minimum Loan: BDT 1,000,000 (Ten Lacks) only Interest Rate: 19.5% per annum Tenor: 3 Years - 5 Years (i.e. 36 to 60 EMI payments) Cash Security: 30% to 50% of the loan amount Following table indicates the monthly repayment amount or EMIs against different loan amounts and tenors: Loan Amount 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000
36 months 36,750 73,500 110,250 147,000 183,750 220,500 257,250
48 months 30,000 60,000 90,000 120,000 150,000 180,000 210,000
60 months 26,050 52,100 78,150 104,200 130,250 156,300 182,350
Please note that the above figures are only indicative and subject to change at the sole discretion of Standard Bank without any prior notice. Eligibility Any Business fulfilling the following criteria can apply for this loan: At least 3 years or more experience in the same business Minimum annual turnover of BDT 12,000,000 (One crore twenty lacs) only Documents
The following denotes the documents required for any business to apply for this loan: Documents 1 2 3 4 5 6 7 8 9 10 11 12
Valid Trade License 3 Year Old Trade License Latest 12 Statement
Month
Bank
National ID of Business Owners Utility Bill of Business TIN Certificate Photograph of the Owners Registered Partnership Deed Memorandum & Article of Incorporation, Form X and XII Certificate of Incorporation Board/ Partnership Resolution All Facility Related Offer Letters
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Please note that the above requirements are not exhaustive and the bank may require further documentation for credit assessment on a case to case basis. Charges Loan Processing Fee: 1% of the approved loan amount Early Settlement Charge: 5% on outstanding amount if repaid at any given time before maturity of the loan VAT and Stamp Charge: All charges and fees are subject to 15% VAT, to be paid by the customer. Stamp charge will be at actual to be paid by the customer. Features: Requirements to apply for this loan*
Any Business enterprise (Private Limited Company, Partnership Firm or Sole Proprietorship Concern) with at least 3 years of business experience is eligible to apply for Business Installment Loan. Minimum annual sales turnover limit* Business requires a minimum annual sales turnover of BDT 12,000,000 (One Crore Twenty Lac) only to be eligible to apply for the loan. Maximum loan amount can avail* Customer can avail this loan up to BDT 7 Million (Taka 7,000,000) only provided your income supports the monthly repayments (EMIs) and other conditions/requirements are met as per bank criteria. Method to repay this loan* Business Installment Loan is an installment based term loan, which gives you the peace of mind of knowing what your fixed monthly repayments (EMIs) are going to be. It also helps your business to build up its equity. We provide the maximum flexibility to repay the loan at your convenience. You can choose a tenor from 36 months to 60 months (3 Years to 5 Years). Requirement for security or collaterals* Customer would have to provide 30% to 50% security of the approved loan amount depending on your existing repayment track record with us. This security has to be provided in the form of fixed deposit with Standard Bank. 3.8 Loan Against Property(LAP) At Standard Bank we strive to meet your needs in a competitive and dynamic business environment. We understand that, as an SME, you require quick access to cash, and the flexibility to leverage your assets to fuel your business growth. Standard Bank Loan Against Property provides the liquidity you need to grow your business or meet cash flow requirements. The loan enables you to leverage your property to obtain financing. Features – Loan against property is very flexible and is designed to meet the different financial needs of your business. Want to expand your business leveraging on your existing property? With Loan Against Property you can undertake long term investments for expansion. In the process Loan Against Property also enables you to build up business equity by repaying the loan in monthly installments. Maximum Loan: BDT 28,000,000 (taka two crore eighty lac) only
Minimum Loan: BDT 1,400,000 (taka fourteen lac) only Interest Rate: 16% per annum Tenor: 3 Years - 10 Years (i.e. 36 to 120 EMIs payments) Maximum% of loan amount against market value of For Commercial Property 60% of property’s current For Residential Property 70% of property’s current market value
the property: market value
Following table indicates the monthly repayment amount or the equal monthly installments (EMI) is given below: Loan Amount 2,500,000 7,500,000 12,500,000 17,500,000 22,500,000 25,000,000 28,000,000
60 months 60,800 182,400 304,000 425,600 547,200 608,000 680,960
72 months 54,250 162,750 271,250 379,750 488,250 542,500 607,600
84 months 49,675 149,025 248,375 347,725 447,075 496,750 556,360
96 months 46,325 138,975 231,625 324,275 416,925 463,250 518,840
108 months 43,825 131,475 219,125 306,775 394,425 438,250 490,840
120 months 41,900 125,700 209,500 293,300 377,100 419,000 469,280
Please note that the above figures are only indicative and subject to change at the sole discretion of Standard `Bank without any prior notice. Eligibility To be eligible to apply for this loan, the applicant must fulfill the following criteria: At least 3 years of experience in same business A minimum annual turnover of BDT 7,000,000 (Taka Seventy Lac) only Documents The following denotes the documents required for any business to apply for this loan: Proprietorship Partnership Private Limited Documents Concern Firm Company 1 2 3 4 5
Valid Trade License 3 Year Old Trade License Latest 12 Month Bank Statement National ID of Business Owners Utility Bill of Business
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TIN Certificate Photograph of the Owners Registered Partnership Deed Memorandum & Article Incorporation, Form X and XII Certificate of Incorporation Board/ Partnership Resolution All Facility Related Offer Letters
Property Documentation Requirement: For Government/Leasehold Land: Lease Deed/ Ownership Deed (photocopy) Baya Deed for at least 25 years, if any (photocopy) Development Agreement/ Joint Venture Agreement with the land owner/ developer Power of Attorney (if any) Power of Attorney Acceptance Letter from lessor of the property Mutation (any one) Mutation Letter from RAJUK/ CDA Mutation Letter from National Housing Authority (NHA) Mutation Letter from Ministry of Works Duplicate Carbon Receipt (DCR) with Mutation Order Sheet Up to date Municipality Tax Receipt Up to date Land Tax Receipt Non-Encumbrance Certificate (NEC) Approved Plan/ Layout Plan and Approval Letter by RAJUK/CDA/Concerned Authority
Any other documents as advised by the bank’s lawyer For Private/Freehold Land: Ownership Deed (photocopy) Baya Deed for atleast 25 years, if any (photocopy) Development Agreement/ Joint Venture Agreement with the land owner/ developer Power of attorney (if any) Recent Survey Report (i.e. Math Parcha Duly attested) CS, SA, RS Parcha (PS, BS, RS Parcha- only applicable for Chittagong) Mutation Parcha and Mutation Proposal Sheet Duplicate Carbon Receipt (DCR) with Mutation Order Sheet Up to date Municipality Tax Receipt Up to date Land Tax Receipt Non-Encumbrance Certificate (NEC) Approved Plan/ Layout Plan and Approval Letter by RAJUK/ CDA/ Concerned Authority Any other documents as advised by the bank’s lawyer Please note that the above requirements are not exhaustive and the bank may require further documentation for credit assessment on a case to case basis. Charges Loan Processing Fee: 1.5% of the approved amount Valuation Fee: BDT 5000 per property Legal fee: BDT 7000 property Early Settlement Fee: 5% on outstanding amount if repaid at any given time before maturity of the loan VAT and Stamp Charges: All charges and fees are subject to 15% VAT, to be paid by the customer. Stamp charge will be at actual to be paid by the customer.
NOTE: valuation and legal fees are non-refundable and inclusive of processing fee of 1.5% +VAT of the loan. Both fees will be discounted from the said processing fee at the time of loan disbursement if the loan is approved by the bank, the facility is availed by the customer and the property(s) are mortgaged in favor of the Bank. Featues: Eligible: Businesses (private limited, partnerships and sole proprietorships) with at least 3 years of business operations. Minimum turnover* Business minimum sales turnover of BDT 7,000,000 (Tk. Seventy Lac only) to be eligible to apply for the loan. Maximum loant amount can avail* Avail to BDT 28 million (Taka 28,000,000 only) provided your income supports the monthly repayments, the loan amount does not exceed the 60% or 70% (as applicable) of your property’s current market value and other conditions/requirements are met as per bank criteria. Properties are eligible as securities for type of loan* Customer can provide both your residential or commercial properties as securities for this loan; except for vacant land. All these properties must be located within the Dhaka or Chittagong metropolitan area. The eligible commercial properties are shops and office spaces. Repayment mechanism for Loan against Property* Loan against Property is an installment based term loan, which gives you the peace of mind of knowing what your fixed monthly repayments (EMIs) are going to be. It also helps your business to build up its equity We provide the maximum flexibility to repay the loan at your convenience. You can choose a tenor from 36 months to 120 months (3 Years to 10 Years). Residential/commercial property mortgaged with another bank; can still take up loan against property If Customer has an existing mortgaged property with another bank, you can take up Loan against Property where we will re-finance your mortgage. In such cases your existing bank must release the mortgage and handover the mortgage to us. The loan outstanding (with another bank) may be settled by you or taken over by us, depending on the nature of the facilities CHAPTER – 4
CARDS 4.1Credit Card Standard Bank Credit Card Product Range Standard Bank Ltd (SBL) issues both VISA and MasterCard Credit Cards, the two renowned Credit Card brands. Our product range includes: Local Card a)Visa Silver Credit Card: There are lots of reasons to choose a Standard Bank Credit Card, and hardly any to not to! With unbeatable benefits such as the Rewards, Card Cheque, Auto Bills Pay, 4-in-1 Offer, Free@18, InstaBuys @ 0%, and many more, the choice is really quite simple b)MasterCard Silver Credit Card: There are lots of reasons to choose a Standard Bank Credit Card, and hardly any to not to! With unbeatable benefits such as the Rewards, Card Cheque, Auto Bills Pay, 4-in-1 Offer, Free@18, InstaBuys @ 0%, and many more, the choice is really quite simple. c)MasterCard Gold Credit Card: Starting from FREE Access to Business Class Lounge to exclusive dining & shopping discounts, the Standard Bank Gold Credit Card gives you a world of benefits that are true to its name. SMS Banking Facility This feature provides cardholders an easy 24-hour direct access to their Credit Card balance information on their GP or CityCell mobile. Cardholders availing this service will also receive a monthly mini-statement through SMS, absolutely free. 4.2Debit Card Debit Card is a smart alternative to cash and meant to make shopping more convenient. Our Debit Card can be used to pay for purchases at more than 3000 merchant establishments in Bangladesh and is also accepted in any Visa ATM. Features This Debit Card is offered with all* BDT Savings and Current Accounts This card is valid only in Bangladesh. The daily transaction limit is as below:
Daily ATM Limit BDT 50,000
Withdrawal Daily Retail Purchase Limit BDT 100,000
Useful Tips: Please sign your Debit Card immediately on the signature panel to avoid any misuse and/or financial loss. Your card is only for your own use. Please do not hand it over to anyone other than designated officers of the Bank at the Bank’s branches. Please keep your PIN in a safe place at all times. Do not keep your PIN with your Debit Card and do not disclose your PIN to anyone. Please do not leave your card near a TV or other electronic devices that have a continuous magnetic field. Please do not bend your Debit Card or leave it exposed to sunlight. After using your Debit Card at a merchant establishment, please ensure that the card returned to you is yours. Retain your copy of the charge slip on all transactions until they appear in your Bank Account statement and for your future reference. CHAPER -5 Liabilities 5.1 Sav ings Account: Standard Bank Savings Account is a convenient and right way to manage your money. They work hard to give to customers the best return on customer’s investment. Attractive Interest Rate Interest is paid on the minimum balance of a particular month and applied to the account on half yearly basis. To get interest, all you have to do is to: Maintain a minimum balance of BDT 3000 above at all times during a month. Can not withdraw through any one debit of more than BDT 5,000 or 10% of available balance, whichever is lower in a particular month. Number of debits permissible in a week must not exceed two transactions. 5.2 Access Account:
Access is a non-branch banking solution that gives the customer more flexibility with: Access to 10 ATMs in six major districts Access to free e-Statement facilities No minimum balance fees Interest is accrued monthly and paid half yearly Annual ATM fee of only BDT 150 Features---Access Account is a Savings Account without any chequebook facility designed for individuals only. The minimum opening balance for this account is BDT 2,000. #Customer will not receive a cheque`book with his Access Account He She will be able to carry out your transactions through your ATM card. #Customer have to pay an annual fee of BDT 150 + 15% VAT for your ATM card. #. The interest rate and the conditions applying to it will be similar to that of our Savings Account. #Customer are required to maintain a minimum balance of BDT 100,000 in order to enjoy interest on your deposits. #Customer can deposit and withdraw money (cash or cheque) absolutely 24 hours a day through our Automated Teller Machines (ATM). #Customer can transfer funds to other accounts. He/ Shewill have to visit any of SBL branches during baking hours to transfer funds. #Customer cannot use branches to withdraw cash. Customer can use branches to deposit money. # Customer can use his or her Access Account statement to receive a loan from Standard Bank. . 5.3Current Account: A frequent transaction account that provides you both convenience and flexibility. Put an end to your worries about carrying large sums of money when you need it. Standard Bank Current account is an efficient and convenient way of handling your daily finances. 5.4Education Savings Scheme
Responsive These days’ parents are finding themselves financially hard-pressed to bear the educational expenses of their children. Education expenses, along with other ancillary costs are soaring up as parents are desperately searching for quality education. To relieve you from this scourge, Standard Bank has come up with an innovative product that would enable you to save a portion of your monthly income in "Education Saving Scheme”. Innovative The scheme is an innovative way to finance ever-bulging education costs that parents have to incur as a result of competitive nature of the situation. The "Education Savings Scheme” gives you the opportunity to create long-term wealth for your children. Through this scheme you can invest part of your monthly income in equal monthly installments and at maturity you will be rewarded with a handsome amount that you will be able to use to defray any expenses that you may have to incur. Now, you can rest assured that your wards will not be required to shelve any quality education opportunity due to the inadequacyoffunds. Convenient Unlike the other banks in Standard Bank you do not require to come to the bank or send someone to deposit the installments. You installments will be deducted automatically from any transaction accounts(s) that you will be required to maintain with SBL. Notable features of the scheme are: This is a fixed term savings scheme to be sold in units Customer can buy any number of units The scheme requires an initial deposit BDT 10,000, which will be followed by monthly installment of BDT 1000 per unit It will be a non-transactional account where interest will accrue on daily basis and will be credited on monthly basis The sign-up fee for the scheme will be BDT 250 per unit, with a minimum of BDT 500 and maximum of BDT 10,000 If any customer desires to discontinue the scheme prior to maturity, a penal fee @ BDT 250 per unit (with a minimum of BDT 500 and maximum of BDT 5000) will be deducted from the account and the balance proceeds (calculated on the amount incorporating the last interest credit amount, the fraction days will not be considered) will be credited to his/her transaction amount Failure to make three consecutive installments will result in immediate closure of the scheme and a penal fee @ BDT 500 per unit will be charged
In case of forced closure (nonpayment of three consecutive installments) before 1 year, a penal charge @ BDT 2000 per unit will be charged The interest rate applied on the collection account will be 3% higher than the rate offered on the scheme account If there is any tax payable under the scheme, it will be deducted from the amount payable to the account holder In case of death of Education Savings Scheme holder the account will cease and the amount deposited till the time of death and accrued interest will be paid to the nominee Schedule of Tenure & Terminal Values for 1 unit Tenure 3 years 10 years 15 years
Initial Deposit 10,000 10,000 10,000
Monthly Deposit 1,000 1,000 1,000
Total Payment 46,000 130,000 190,000
Maturity Value 52,310 206,510 400,227
Profit 6,310 76,510 210,2270
Schedule of Tenure & Terminal Values for 10 units Tenure
Initial Monthly Total Maturity Profit Deposit Deposit Payment Value 3 years 100,000 10,000 460,000 533,334 73,334 10 years 10o,000 10,000 1,300,000 2,196,630 896,630 15 years 100,000 10,000 1,900,000 4,407,564 2,507,564 5.5Fixed Deposit: Standard Bank Fixed Deposits make your money work for you. With the advantage of Standard Bank's expertise, resources and experience, Customer can assure of maximizing the growth potential of your savings safely. Products
that
suit
Customer
needs*
With SBL’s range of fixed deposits products, you have the option to earn a very high interest. Perfect combination of liquidity and returns* Standard Bank wide range fixed deposit products are the perfect combination of liquidity and returns. You have the freedom to choose from the desired period from one month to Five year. If you need cash before the end of your fixed deposit term, Overdraft/Loan facilities is obtainable against security of FD without losing the interest earning & the FD. Premature encashment will result in forfeiture of interest. Affordable Opening Balance *
The minimum opening balance and to earn interest on Fixed Deposit account is only BDT 10,000. 5.6Foreign Currency Current Account: Applicable to Bangladeshis working abroad, it can be opened in USD, GBP and Yen without restriction on transaction frequency. Can be operated through nominees in absence of the accountholder. Fund remains in foreign currency and is freely remittable. Key features: Deposit can be made in foreign currency only (cash, TC or Drafts or transfer from other Fcy account) Cash withdrawal from the account is in local currency o Fund Remittance (in both Lcy and Fcy) to any place in and out of the country (without restriction) Fund can be used to make investment in Wage Earners' Development Bond 5.7Graduate Account: Graduate Account is a customized Savings Account for ongoing graduate and post-graduate university / college students, who are at least 18 years old. Interest bearing Savings Account* Watch money grows with competitive interest rates that give you regular returns. Interest is accrued on daily basis and credited to the account on half-yearly basis. Sure return* Insurance Facility of our Savings Scheme offers sure return to your children or anyone selected by you as the nominee in case of your unfortunate death before the maturity of the scheme. Nominee will receive the total amount (equal to the proposed Maturity Value for any particular scheme) no matter how much you have paid. Minimum account opening balance BDT 10,000 No Average Balance and Relationship Fees Maximum ATM withdrawal limit BDT 5,000 per day Graduate Account - Tuition Protection Accidental Death Insurance plan * It is taken into consideration that in most situations, the parents or the legal guardian (stated in the passport or the letter of introduction provided by university) will be the
source of the fund for a Graduate Accountholder. Considering the chances of sudden death of parents or the legal guardian, the Graduate Account will have coverage for 'Tuition Protection Accidental Death Insurance plan? Depending on the unfinished tenure of education of the student, actual Graduate Accountholder, the insurance company will provide the financial-security to complete the graduation. Special lifestyle offers * Special discounts or lifestyle benefits at selected partner outlets will be offered to the studentstimetotime. 5.8 Millionaire Scheme: Forced Saving is instrumental for future. Standard Bank offers you an excellent opportunity to save rainy days. Start with BDT 100,000 and deposit BDT 10,000 per month and become a millionaire in just 5 years 9 months. Tenor
Initial Deposit
Monthly Deposit
5 years / 9 months 10 years
100,000 100,000
10,000 10,000
Total Payment by Customer 790,000 1000000
Profit
Value at Maturity
229,429 896,631
1,019,429 2,196,631
Terms and Conditions: This is a fixed term saving scheme. Customer can buy any number of Millionaire Scheme. The scheme requires an initial deposit of BDT 100,000, which will be followed by monthly installment of BDT 10,000 till maturity. The scheme is for 5 years 6 month and 10 years. It will be a non-transactional account where interest will accrue on daily basis and will be credited on The sign-up fee for the scheme will be BDT 2,500.The sign-up fee for the scheme will be BDT 250 per unit, with a minimum of BDT 500 and maximum of BDT 10,000 If any customer desires to discontinue the scheme prior to maturity, a penal fee @ BDT 5000 will be deducted from his account and the balance proceeds (calculated on the amount, incorporating the last interest credit amount, the fraction days will not be considered) will be credited. Failure to make three consecutive installments will result in immediate closure and a penal fee @ BDT 5000 will be charged.
In case of forced closure (non-payment of three consecutive installments) before 1 year, a penal charge @ BDT 7,500 will be charged. The interest rate applied on the collection unit will be 3% higher than the rate offered on the scheme account. If there is any income tax payable under the scheme, it will be deducted from the amount payable to the account holder. The rates of interest payable on the scheme is subject to change without any prior notice & this may affect the matured value of the scheme. In the event of the death of scheme holder, the account will cease and the amount deposited till the time of death and accrued interest will be paid to the nominee. 5.9Monthly Savings Scheme: Insurance Coverage Facility is an added feature of Education Savings Scheme, Rainy Day Savings Scheme and Marriage Savings Scheme. Under this facility your nominee(s) will receive the Maturity Amount in case of your untimely death. The facility is available in any of the above mentioned three schemes for 3-year, 5-year or 10-year termonly. All of these Savings Schemes are for fixed term and sold in units. To buy one unit of any of these schemes you need to deposit BDT 10,000 at the beginning and a monthly deposit of BDT 1000 till the maturity of the scheme. Secured * With the addition of this facility, our Monthly Savings Schemes now offer you an alternative to eliminate the uncertainties from your beloved children's life in case of your untimely death. If you feel worries about their education related expenses, marriage or other contingency needs in your absence, our Monthly Savings Schemes offer you the perfect solution. With our Monthly Savings Scheme your children's future will be in safe hands. Sure return* Insurance Facility of our Savings Scheme offers sure return to your children or anyone selected by you as the nominee in case of your unfortunate death before the maturity of the scheme. Your nominee will receive the total amount (equal to the proposed Maturity Value for any particular scheme) no matter how much you have paid. Who can buy it? Standard Bank's existing customers, who are: Bangladeshi nationals and minimum age must be 18 years and maximum age at the end of the scheme is 60 years
Residing in Dhaka, Chittagong, Narayanganj, Bogra, Khulna or Sylhet If you are not banking with us, you can open Savings, Current or Access account with us to be eligible for the scheme Features: Nominee(s) will receive the Target Savings Amount in the event of untimely death of the primary account holder, i.e. death before maturity of the selected Monthly Savings Scheme These are non-transactional account where interest accrues on a daily basis and is credited on a monthly basis The sign-up free for the schemes is BDT 250 per unit, with a minimum of BDT 500 and maximum of BDT 10,000 If any customer desires to discontinue any scheme prior to maturity, a penal fee of BDT 250 per unit (with a minimum of BDT 500 and maximum of BDT 5000) will be deducted from the account Failure to make three consecutive instalments will result in immediate closure and a penal fee of BDT 500 per unit will be charged In case of forced closure (non-payment of three consecutive instalments) before 1 year, a penal charge of BDT 2000 per unit will be charged If there is any tax payable under the scheme, it will be deducted from the amount payable to the account holder Calculation of one unit of Monthly Savings Scheme: Tenor Initial Deposit Monthly Deposit Total Payment Value at Maturity Profit Tenor 3 years 5 years 10 years
Initial Deposit 10,000 10,000 10,000
Monthly Deposit 1,000 1,000 1,000
Total Payment 46,000 70,000 1,30,000
Maturity Value 51,751 83,070 1,78,745
Profit 5,751 13,070 48,745
CHAPTER 06 Miscellaneous Challenges of work SBL being an local bank has a very friendly and helpful working environment. Being an intern the most challenging work for me was to perform my daily job properly.
I had to be very sincere and alert while I was doing my work as any mistake done by me could do a great harm to the bank. The work environment at SBL always provided me with challenge to improve my performance everyday. Learning Experience: I have learned that when the internal communication is effective among the employees within the organization, it tends to encourage employees to perform better and it automatically motivates the employees. I learn the total recruitment system of sales in SBL, I also learned about the latest interest rate of the product I learned to banking environment and also the file process.; CHAPTER 07 CONCLUSION Standard Bank is still regarded as reliable bank and the growing number of its customers indicates its acceptance among clients. But it should be considered that the customers have very few choices of banks with which they can actually compare the service of SBL, The nationalized banks of Bangladesh already have earned a bad reputation in serving customers. Other private banks have limited operation in limited locations. The local banks
have
recently
focused
their
attention
to
customer
service,
satisfaction and also credit service. Moreover there are a good number of private banks that are coming into the competition soon. Therefore, it is better for SBL not to let situation be worst and should emphasize on serving customers effectively and efficiently to ensure better service. CHAPTER 08 RECOMENDATION In this short span of time at the organization, I have tried my level best to acquire as much knowledge as possible about the bank and its way of conducting operations. I was assigned to GB department, but had the opportunity to communicate with employees of other departments as well this helped me to attain a splash of knowledge about the other banking
functions. I believe I lack the qualifications/experience to criticize its system but as a well wisher of the Standard Bank Limited (SBL) I would like to shed some light on a few issues which I believe; SBL has got potentials to work on in order to improvise their activities further. Some recommendations are given to match customer’s criteria and deliver better services: 1. Formulation of (MMP) Model Marketing Plan Management of the Bank is to work for creation of conceptual framework covering core elements of developed “Model Marketing Plan – (MMP)” of Standard Bank Limited to face the competition and changes in the banking industry into the new millennium for sustained growth of business / profitability of the bank 2. Realistic Business philosophy: Business philosophy that identifies current and future opportunities, defines magnitude and quantum, determines target markets and cluster, and decides on products, services and programs to secure entry to markets for economic and financial gains were made. The aim of planned marketing efforts is to understand customers and to ensure that offered products and services adapt to targeted customers’ needs perfectly. The marketing plan to be designed to perform tasks of stimulating demands for Bank’s products and services to influence the level timing and composition of demand help customers’ consummate their business objectives. 3. Refresh Review of total System In pursuit for excellence, the management of Standard Bank should review their systems, policies, processes and product prices in line with the changing market reality. 4. Total Market segmentation for proper class satisfaction Selection of target markets including dividing the markets into major market segments sharing common properties, evaluation, selecting and targeting segments and deciding on ways of positioning in each market can be a good way of satisfying clustered market options. 5. Improvement of the HRD The HR department of the bank is one of the weakest areas and many of the human resource development policies and practices are not being followed or implemented.
Though, there has been performance appraisal for the employees but still it is lying idle and no action has been taken. The management should immediately apply the performance appraisal system and take appropriate actions on the basis of that appraisal. All sorts of promotions or other benefits should be based on the report of the performance appraisal. The traditional method of considering years of work experience as the criteria should be changed and rather the new method of looking at the output, productivity and quality of the work should be considered. The HR wing has to be more active rather than maintaining administrative duties. Other than the head of this division, the staffs in this wing are incompetent for this position. More qualified and skilled HR professional should be recruited for this department for the future growth of the HR in SBL. The HR department should be gradually extended at the branch level as the bank is expanding so that each branch has a HR official. 6. Formulation of Recruitment / remuneration policy •
Better recruitment
SBL must pursue a strong and an effective recruitment system so that the right people are recruited at the right job. But now as the bank is expanding, it must focus on attracting, getting and retaining qualified personnel for filling up its positions. It is worth spending more on attracting qualified human resources rather than getting the wrong people in the wrong positions. •
Stop Reference Appointment
SBL management and particularly the Board of Directors must change the system of appointing people by giving their reference. It has been deeply observed that most of the reference appointees are not up to the standard and have a poor performance. For the sake of the bank’s future and further strengthening the quality of work force, this tendency to appoint people on reference must be stopped •
Enhancement of remuneration package
The present compensation package at SBL is very unimpressive and not capable to attract quality personnel to fill up its positions. Many skilled and devoted officers of the bank are depressed with their compensation package. Since the foreign banks pay double that of SBL and other private banks also have a higher scale than SBL, it is high time that the
management should consider revising the remuneration package in order to attract quality human resources. 7. Improvement of quality of service The improvement of service quality is must for the Bank because in this is the time of presenting people the best you have in your hand and Standard Bank is far more behind than its competitors in the market. So if they want to see themselves as a leading private bank they have to do more than enough on quality of services to customers. 8. Branch Expansion For expanding geographically the bank should open up new branches in strategically important places. Before entering into a new market the bank should do extensive market research. 9. Introduction of compliance management Most of the local & foreign banks are using this management where they can get the current feedback from the consumer which is must for any organization trying to satisfy its customers most. 10.
Employee training
Employee training over customer satisfaction would be great for the bank because it will help them to cooperate & interact more professionally with the customers as well as they would know how to settle a practical problem in banking career. Nowadays it is must for the private Banks because of its competitiveness in the market. 11.
Introduction of wide range of new products & services
To attack more new customers or to retain existing customers the bank has to introduce new range of product & services to customers. Otherwise they will be bored having a same service twice or more time and go for the other to satisfy their new needs. 12.
Improving ATM / Debit/ credit card facility
Expansion of ATM service & improving the quality of card service is must for the Bank. Because it has no ATM networks of its own and customers have to pay extra charges to attend any sort of ATM services. So introduction of its own ATM service will do satisfy the customers more. 13.
Advertisement and Promotion
Advertising & promotions are one of the modern techniques to gain attention of new customers as well as it’s strategically a tactical way of spreading the good waves of the organization. This bank is lacking in this sector than its competitors. If the bank is going to capture a new market & attract people with its new array of products, advertising & promotions is must . SBL should pursue an aggressive advertising campaign in order to build up a strong image and reputation among the potential customers. It must give up the idea of maintaining a low profile in the market. Rather, it should come in to the limelight through an aggressive marketing campaign such as advertisement in the newspapers and magazines, more billboards and neon signs, publicity messages and promotional campaigns. SBL can also pursue promotional campaigns with its customers particularly the corporate clients in order to build up a stronger rapport with them. Television advertisement is also a major method for attracting the potential customers. As it is a new bank, a strategy of exposing the bank to the public must be taken so that the general people are aware about the emergence and the growth of the bank. 14.
emphasis on corporate clients
SBL should provide sophisticated services to big corporate clients and should introduce many innovative and enterprising schemes to support the corporate clients. Now the bank should increase its investments in sectors like real state, consumer loans, health care etc. in order to make adjustment in its credit portfolio. SBL can also pursue promotional campaigns with its customers particularly the corporate clients in order to build up a stronger rapport with them. This is an innovative way of attracting corporate clients to the bank. In stead of providing CCS to executives of various companies, SBL can introduce a special scheme for corporate officers for the purchase of consumer durable at an attractive interest rate. In this way, the bank will be able to attract a lot of corporate clients and in the long run the bank would be benefited by getting business for the bank from the corporate clients in terms of L/C, Loans and advances etc. for example, officers of BTC, Uniliver , Square, Beximco can be entered in to the corporate scheme. 15.
Delegation of authority
As a part of introducing participate management system in the organization, there should be gradual delegation of authority in order to develop future leaders with in the organization. Authority should be delegated gradually to a certain extent at the branch level for speedy disposal of financial matters and providing faster services. Moreover, in a decentralized organization there will be both top down and bottom up communication and therefore the communication channel with in the company becomes stronger. The top management also comes to know better ideas from the lower level and many ideas from there can be implemented for the development of the bank. 16. More Staff Meetings All the departments in the Head Office as well as in the branches should have more staff meetings and inter departmental meetings. This would allow each department to monitor its on going progress and identify the hindrances or the hurdles while achieving their targets or carrying out the activities. Through staff meetings at all start of the management would make a concentrated effort of all the employees to achieve their goals and which in turn would allow the organization to achieve the targets. Departmental staff meetings can be held weekly or fortnightly and this would allow in charge of each department to identify the problem areas and corrective actions can be taken immediately or can be informed to the higher authorities. The process of pro-active strategies can be implemented through regular staff meetings instead of pursuing a reactive strategy where each department waits for the feedback from their higher authorities, Used in the foreign banks. It is also cost effective for the management to introduce new banking software as it has all the modern banking facilities and will actually prove effective in the long run for the bank when it considers establishing ATM and other automated banking facilities. 17.
Develop IT sector
Now days the financial services industry, especially the banking sector is undergoing revolutionary changes with the advent of modern technology and introduction of new products based on the electronic system, the concept of conventional banking has been changed.
In Bangladesh, although we are lacking a total integrated banking software solution of international standard, however, Standard Bank Limited put its best efforts to introduce a computerized banking system which provides efficient, reliable, fast service and accurate information to its customer as well as management, shareholders and regulatory bodies. 18.
Introduction of advanced banking software
As there are service limitations in the present STEALER Bank software that is quite inadequate in providing speedy services both to the customer and internal uses of the bank. Therefore, the concerned authorities should consider replacing the STEALER banking system with more advanced banking software.