View with images and charts Effect of Promotional Expenditure of Commercial Bank on Profit of Bank Introduction A commercial bank is a type of financial intermediary and a type of bank. Commercial banking is also known as business banking. It is a bank that provides checking accounts, savings accounts, and money market accounts and that accepts time deposits. After the Great Depression, the U.S. Congress required that banks engage only in banking activities, whereas investment banks were limited to capital market activities. As the two no longer have to be under separate ownership under U.S. law, some use the term "commercial bank" to refer to a bank or a division of a bank primarily dealing with deposits and loans from corporations or large businesses. In some other jurisdictions, the strict separation of investment and commercial banking never applied. Commercial banking may also be seen as distinct from retail banking, which involves the provision of financial services direct to consumers. Many banks offer both commercial and retail banking services. Possible meanings Commercial bank has two possible meanings: Commercial bank is the term used for a normal bank to distinguish it from an investment bank. This is what people normally call a "bank". The term "commercial" was used to distinguish it from an investment bank. Since the two types of banks no longer have to be separate companies, some have used the term "commercial bank" to refer to banks that focus mainly on companies. In some English-speaking countries outside North America, the term "trading bank" was and is used to denote a commercial bank. During the great depression and after the stock market crash of 1929, the U.S. Congress passed the Glass-Steagall Act 1933-35 (Khambata 1996) requiring that commercial banks engage only in banking activities (accepting deposits and making loans, as well as other fee based services), whereas investment banks were limited to capital markets activities. This separation is no longer mandatory. It raises funds by collecting deposits from businesses and consumers via checkable deposits, savings deposits, and time (or term) deposits. It makes loans to businesses and consumers. It also buys corporate bonds and government bonds. Its primary liabilities are deposits and primary assets are loans and bonds. Commercial banking can also refer to a bank or a division of a bank that mostly deals with deposits and loans from corporations or large businesses, as opposed to normal individual members of the public (retail banking). Origin of the word The name bank derives from the Italian word banco "desk/bench", used during the Renaissance by Florentine bankers, who used to make their transactions above a desk covered by a green tablecloth. However, traces of banking activity can found even in ancient times.
In fact, the word traces its origins back to the Ancient Roman Empire, where moneylenders would set up their stalls in the middle of enclosed courtyards called macella on a long bench called a bancu, from which the words banco and bank are derived. As a moneychanger, the merchant at the bancu did not so much invest money as merely convert the foreign currency into the only legal tender in Rome- that of the Imperial Mint. A commercial bank is a type of financial intermediary and a type of bank. Commercial banking is also known as business banking. It is a bank that provides checking accounts, savings accounts, and money market accounts and that accepts time deposits. According to the establishment of the commercial bank it’s categorized into three parts which are first generation, second generation and third generation. From those criteria I have selected two banks from each generation which are following First generation AB Bank Limited. Islamic Bank Limited. Second generation Eastern Bank limited. Prime Bank Limited. Third generation The Trust Bank Limited. BRAC Bank Limited. Objective To analyze the effect of promotional expenditure of commercial bank on the profitability. Scopes: Internet and computer problem of our lab. Compile up the graph. Sources & Methods of Collecting Information The required information for the analysis mainly came from primary sources. We also use secondary sources like websites, news paper articles, economic and statistical journals and other reports. That secondary and primary information was first analyzed and then took under consideration which might be used for the analysis. Litareture Review Promotional mix The promotional mix consist of the blend of advertising , sales promotion ,public relations, personal selling, and direct marketing tools that the company uses to pursue its advertising and marketing objective.
Advertising Any paid form of non personal presentation and promotion of ideas, goods, or services by an identified sponsor. Advertising can reach masses of geographically dispersed buyers at allow cost per exposure, and it enables the sellers to repeat a message many times.
For example television advertising can reach huge audiences.
Personal selling
Personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships. Personal selling is more effective tools at certain stage of buying process, particularly in building up buyer’s preference, conviction, and action. It involves personal interaction between two or more people, so each person can observe other’s needs and characteristic s and make quick adjustments.
Sales promotion
Sales promotion is short term incentives to encourage the purchase or sales of product or service. Sales promotion include wide assortment of tools like coupons, contests, cent of deals, premium and others all of which have unique qualities.
Public relation Public relations (PR) are the practice of managing the flow of information between an organization and its publics. Public relations gain an organization or individual exposure to their audiences using topics of public interest and news items that do not require direct payment. Because public relations place exposure in credible third-party outlets, it offers a third-party legitimacy that advertising does not have. Common activities include speaking at conferences, working with the press, and employee communication.
Public Relation can be used to build rapport with employees, customers, investors, voters, or the general public. Almost any organization that has a stake in how it is portrayed in the public arena employs some level of public relations. A number of specialties exist within the field of public relations, such as Analyst Relations, Media Relations, Investor Relations or Labor Relations.
AB Bank Limited AB Bank Limited, the first private sector bank under Joint Venture with Dubai Bank Limited, UAE incorporated in Bangladesh on 31st December 1981 and started its operation with effect from April 12, 1982. Dubai Bank Limited (name subsequently changed to Union Bank of the Middle East Limited) decided to off-load their investment in AB Bank Limited with a view to concentrate their activities in the UAE in early part of 1987 and in terms of Articles 23A and 23B of the Articles of Association of the Company and with the necessary approval of the relevant authorities, the shares held by them in the Bank were sold and transferred to Group "A" Shareholders, i.e. Bangladeshi Sponsor Shareholders. As of December 31, 2007; the Authorized Capital and the Equity (Paid up Capital and Reserve) of the Bank are BDT 2000 million and BDT 4511.59 million respectively. Authorized Capital of the Bank has been increased to BDT 3000 million in the Extra Ordinary General Meeting held on July 16, 2008. Since beginning, the bank acquired confidence and trust of the public and business houses by rendering high quality services in different areas of banking operations, professional competence and employment of the state of art technology. During the last 27 years, AB Bank Limited has opened 73 Branches in different Business Centers of the country, one foreign Branch in Mumbai, India and also established a wholly owned Subsidiary Finance Company in Hong Kong in the name of AB International Finance Limited. To facilitate cross border trade and payment related services, the Bank has correspondent relationship with over 220 international banks of repute across 58 countries of the World. AB Bank Limited, the premier sector bank of the country is making headway with a mark of sustainable growth. The overall performance indicates mark of improvement with Deposit reaching BDT 53375.35 million, which is precisely 26.85% higher than the preceding year. On the Advance side, the Bank has been able to achieve 30.76% increase, thereby raising a total portfolio to BDT 40915.35 million, which places the Bank in the top tier of private sector commercial banks of the country. Product and service of AB bank Personal Loan Target Customer Employees of reputed Local Corporate, MNCs, NGOs, Airlines, Private Universities, Schools and Colleges, International Aid Agencies and UN bodies, Government Employees, Selfemployed Professionals (Doctors, Engineers, Chartered Accountants, Architects, Consultants), Businessmen. Purpose Purpose Marriages in the family, Purchase of office equipment / accessories, Purchase of miscellaneous household appliances, Purchase of Personal Computers, Purchase of audiovideo equipment, Purchase of furniture. ďƒ˜ Loan Amount Minimum Tk. 25,000.00.
Maximum Tk. 5,00,000.00 Charges Application fee: Tk. 500.00
Rate of Interest: 14.50% p.a. - 17.50% p.a. Auto Loan Target Customer Employees of reputed Local Corporate, MNCs, NGOs, Airlines, Private Universities, Schools and Colleges, International Aid Agencies and UN bodies, Government Employees, Self-employed Professionals (Doctors, Engineers, Chartered Accountants, Architects, Consultants), Businessmen Purpose To purchase Brand new vehicle, non-registered reconditioned vehicle Loan Amount 70% for the brand new car 60% for the reconditioned car but must not exceed BDT 10,00,000.00 Rate of Interest 14.50% p.a. - 17.50% p.a. Easy Loan (For Executives) Target Customer The loan is specially designed for salaried people who are employed in different reputed companies Purpose Marriages in the family, Purchase of office equipment / accessories, Purchase of miscellaneous household appliances, Purchase of Personal Computers, Purchase of audiovideo equipment, Purchase of furniture, Advance rental payment, Trips abroad, Admission/Education fee of Children etc. Loan Amount Minimum Tk. 50,000.00 Maximum Tk. 3,00,000.00 Rate of Interest 16.00% p.a. Gold Grace - Jewellery Loan
Target Customer Both female & male employees may apply viz. employees of reputed Banks & Leasing companies, reputed Local Corporate, MNCs, NGOs, Airlines, Private Universities, Schools and Colleges, International Aid Agencies and UN bodies. Government Employees. Selfemployed Professionals (Doctors, Engineers, Chartered Accountants, Architects, Consultants). Businessmen with a reliable regular source of income. Purpose To purchase ornaments/Jewellery for personal use Loan Amount Minimum Tk. 50,000.00 Maximum Tk. 3,00,000.00 Processing fee: 1% on the approved loan amount or Tk. 1000.00 whichever is higher Rate of Interest: 16.00% p.a. Corporate Banking At AB Bank we provide complete range of solutions to meet Corporate Customers' requirement. Our Corporate Banking solutions include a broad spectrum of products and services backed by proven, modern technologies. Corporate Lending Our specialist teams offer a comprehensive service providing finance to large and mediumsized businesses based in Bangladesh. For more information as to how we might best meet your corporate debt needs, please contact us at our Corporate Head Office. Structured Finance We have a specialist Structured Finance Team who arrange and underwrite finance solutions including Debt and Equity Syndication for financial sponsors, management teams and corporates. Also we provide corporate advisory services.
We aim to provide tailored financing solutions with a dedicated team who can rapidly respond to client needs. Following are some of the products and financial tools of Corporate Banking: Project Finance Working Capital Finance Trade Finance Cash Management Syndicated Finance, both onshore & off-shore
Equity Finance, both onshore & off-shore Corporate Advisory Services SME Banking Considering the volume, role and contribution of the SMEs, in the last two decades AB Bank has been patronizing this sector by extending credit facilities of different types and tenor. As of now 54% of the bank’s total loan portfolio is segmented to the SMEs which deserve all out attention in our plans, projections and forecasting.
As such the bank has emphasized on the following issues:
To provide the best services to the SME sector To increase the SME portfolio of ABBL significantly To improve the quality of ABBL’s portfolio
SME Sectors in which AB Bank has participated so far: Agro machinery Poultry Animal Feed Dairy Product Fruit Preservation Hotel & Restaurants Garments Accessories Leather products Plastic product Furniture : Wooden & Metal Ink Paint Printing & Packaging Wire & Cable Aluminum Cement and Lime Plaster
Table: 1.Bank’s promotional expenditure and profitability of AB bank Year
promotional expenditure(x) in Tk
profit(y) in Tk
2004
19637226
90066599
2005
23404603
162453608
2006
27218559
532186349
2007
44720259
1903493845
2008
64989223
2300621640
Total
179969870
4988822041
Fig: 1. promotional expenditure and profitability of AB bank from 2004-2008 expenditure & profitability 2500000000
value
2000000000
Year
1500000000
promotional expenditure(x)
1000000000
profit(y)
500000000 0 1
2
3
4
5
year
Promotional expenditure and profitability of AB bank from 2004-2008: According to the figure 1 we have reached to find out that the trend of the promotional expenditure and profitability of the AB bank is increasing on the basis of year. Hear profit has increased massively in compared to the promotional expenditure that’s mean profit of the bank not only influenced by promotional expenditure but it is influenced by another activity but we just consider the promotional expenditure as an influential factor. In this diagram, in 2008 expenditure and profit both has maximized which amount were Tk179969870 and Tk4988822041. Table: 2.Growth rate of promotional expenditure
Year
promotional expenditure(x)
growth rate of P.E
2004
19637226
2005
23404603
19.18487367
2006
27218559
16.29575174
2007
44720259
64.30061195
2008
64989223
45.32389672
Total
179969870
145.1051341
Fig: 2. Growth rate of promotional expenditure from 2004-2008 growth rate of promotional expenditure 2080 2060 2040 2020 2000 1980 1960 1
2
3 Year
4
5
growth rate of P.E
Growth rate of promotional expenditure from 2004-2008: According to the above diagram growth rate of promotional activity of AB bank was more or less fluctuation. Some time growth rate increase drastically and some time has declined little amount. In 2007, growth rate increased at the maximum level that amount was 64.30 percent and the minimum growth rate was 16.29 percent that was the minimum amount. Table: 3. Growth rate of profitability from 2004-2008 Year
Profit
Growth rate of p
2004
90066599
2005
162453608
80.3705367
2006
532186349
227.5928159
2007
1903493845
257.6743087
2008
2300621640
20.86309846
Total
4988822041
586.5007598
Fig: 3. Growth rate of profitability from 2004-2008 gowth rate of profit 2500 2000 1500 1000 500 0 1
2
3 Year
4
5
6
growth rate of p
Growth rate of profitability from 2004-2008: From the above demonstration, for the influencing promotional expenditure, the growth rate of profit has increased in each year except 2008. In 2007 growth rate of the profit has maximized and the amount was near about 257.67 percent but the growth rate was minimum in 2008 that was approximately 20.86 percent. Table: 4.Effect of promotional expenditure in profits from 2004-2008 Year
growth rate of P.E
growth rate of profit
2005
19.18487367
80.3705367
2006
16.29575174
227.5928159
2007
64.30061195
257.6743087
2008
45.32389672
20.86309846
Total
145.1051341
586.5007598
2004
Fig: 4. Effect of promotional expenditure in profits from 2004-2008
growth of promotional expenditure and profitability 2500 2000 1500 1000 500 0 1
2 Year
3
4
growth rate of P.E
5 growth rate of profit
Effect of promotional expenditure in profits from 2004-2008: According to the above diagram the promotional expenditure has inspired the profitability of AB bank. In this diagram in compared to the promotional expenditure, growth of profitability increase more. Regression of AB bank Variables Entered/Removed (b) Mode Variables Variables l Entered Removed 1 expenditu . re(a)
Method Enter
a All requested variables entered. b Dependent Variable: profit Model Summary Mode l R 1 .966(a)
Adjusted R Square R Square .934
.912
Std. Error of the Estimate 306085573. 04944
a Predictors: (Constant), expenditure ANOVA (b) Model 1
Sum of Squares df Regressio 39751400 n 20018268 1 000.000 Residual 28106513 3
Mean Square F 39751400200 18268000.00 42.429 0 93688378029
Sig. .007(a)
40870190 006300.000 00.000 Total 42562051 54105287 4 000.000 a Predictors: (Constant), expenditure b Dependent Variable: profit Coefficients (a) Unstandardized Standardized Coefficients Coefficients Std. Model B Error Beta t 1 (Consta 3228331 nt) 9067080 -2.809 68.805 84.634 expendit 52.911 8.123 .966 6.514 ure a Dependent Variable: profit
Sig. .067 .007
Islami Bank Table: 5. promotional expenditure and profitability of Islami Bank from 2004-2008. Year
Promotional expenditure
Profitability
2004
40581790
1013647225
2005
48497317
1125821683
2006
77559915
1400591591
2007
78757200
2049053457
2008
101722324
2674796768
Total
347118546
8263910724
Fig: 5. promotional expenditure and profitability of Islami Bank from 2004-2008. Promotional expenditure and profitability 3000000000 2500000000 2000000000 1500000000 1000000000 500000000 0 1
2 Year
3
Promotional expenditure
4
5
Profitability
Promotional expenditure and profitability of Islami Bank from 2004-2008: According to the figure 5 we have reached to find out that the trend of the promotional expenditure and profitability of the Islimi bank increased on the basis of year. Here profit has increased massively in compared to the promotional expenditure that’s mean profit of the bank not only influenced by promotional expenditure but it is influenced by another activity but we just consider the promotional expenditure as an influential factor. In this diagram, in 2008 expenditure and profit both have maximized which amount were Tk101722324and Tk2674796768. Table: 6. Growth rate of promotional expenditure of Islami Bank from 2004-2008 Year
Promotional expenditure
Growth rate of P.E
2004
40581790
2005
48497317
19.5051204
2006
77559915
59.92619757
2007
78757200
1.543690449
2008
101722324
29.15939622
347118546
110.1344046
Fig: 6.Growth rate of promotional expenditure of Islami Bank from 2004-2008
Growth rate of promotional expenditure 2080 2060 2040 2020 2000 1980 1960 1
2
3 Year
4
5
Growth rate of P.E
Growth rate of promotional expenditure from 2004-2008: According to the above diagram growth rate of promotional expenditure of Islami bank was more or less fluctuation. Some time growth rate increase drastically and some time has declined little amount. In 2006, growth rate increased at the maximum level that amount was 59.92 percent and the minimum growth rate was 1.54 percent that was the minimum amount. Table: 7. Growth rate of profitability of Islami Bank from 2004-2008 Year
Profitability
Growth rate of profit
2004
1013647225
2005
1125821683
11.06641988
2006
1400591591
24.40616593
2007
2049053457
46.29914032
2008
2674796768
30.53816429
8263910724
112.3098904
Fig: 7. Growth rate of profitability of Islami Bank from 2004-2008 Growth rate of profit 2060 2050 2040 2030 2020 2010 2000 1990 1980 1970 1
2
3 Year
4
5
Growth rate of profit
Growth rate of profitability from 2004-2008: From the above demonstration, for the influencing promotional expenditure, the growth rate of profit has increased in each year except 2008. In 2007 growth rate of the profit has maximized and the amount was near about 46.29percent but the growth rate was minimum in 2008 that was approximately 11.066 percent. Table: 8.Effect of promotional expenditure in profits from 2004-2008 Year
Growth rate of P.E
Growth rate of profit
2005
19.5051204
11.06641988
2006
59.92619757
24.40616593
2007
1.543690449
46.29914032
2008
29.15939622
30.53816429
110.1344046
112.3098904
2004
Fig: 8. Effect of promotional expenditure in profits from 2004-2008
Growth rate of promotional expenditure and profit 2100 2080 2060 2040 2020 2000 1980 1960
1
2
Year
3
Growth rate of P.E
4
5
Growth rate of profit
Effect of promotional expenditure in profits from 2004-2008: According to the above diagram the promotional expenditure has inspired the profitability of Islami bank. In this diagram in compared to the promotional expenditure, growth of profitability increase more. Maximum growth rate of promotional expenditure was in 2006 and the amount was about 59.92 percent and maximum growth rate of profit was in 2007 and the amount was 46.29. Regression Islami Bank Variables Entered/Removed (b) Mode Variables Variables l Entered Removed 1 expenditu . re(a)
Method Enter
a All requested variables entered. b Dependent Variable: profit Model Summary Mode l R 1 .924(a)
Adjusted R Square R Square .854
.806
Std. Error of the Estimate 307904556. 08757
a Predictors: (Constant), expenditure ANOVA(b) Model 1
Regressi
Sum of Squares df 16669100 1
Mean Square F 1666910045 17.582
Sig. .025(a)
on
45363068 000.000 28441564 69784518 3 00.000 19513256 92341520 4 000.000
Residual Total
363068000.0 00 9480521565 9483900.000
a Predictors: (Constant), expenditure b Dependent Variable: profit Coefficients(a)
Model 1
(Consta nt)
Unstandardized Coefficients Std. B Error 4519192 1520735 48.681 14.050
expendit 25.998 ure
6.200
Standardized Coefficients Beta
.924
t
Sig.
-.337
.759
4.193
.025
a Dependent Variable: profit Eastern Bank Limited Eastern Bank Limited (EBL) is one of the modern, fully online and technologically superior private commercial Banks in Bangladesh. Eastern Bank markets a wide range of depository, loan & card products. These products include different types of Savings & Current Accounts, Personal Loans, Auto Loan, Debit Card, Pre-paid Cards, Internet Banking, Treasury, Syndication, Corporate Banking and SME Banking services through a network of branches & centers countrywide. Eastern Bank has its presence in major cities/towns of the country including Dhaka, Chittagong, Sylhet, Khulna and Rajshahi. Tracing its origin back to 1992, EBL is serving the individual and corporate clientele alike with remarkable success offering innovative banking services since then. Vision To become the bank of choice by transforming the way we do business and developing a truly unique financial institution that delivers superior growth and financial performance and are the most recognizable brand in the financial services in Bangladesh. Mission ďƒ˜ We will deliver service excellence to all our customers, both internal and external. ďƒ˜ We will constantly challenge our systems, procedures and training to maintain a cohesive and professional team in order to achieve service excellence.
We will create an enabling environment and embrace a team based culture where people will excel. We will ensure to maximize shareholder's value. Product and service of Eastern Bank Loan product Jibon dhara loan Feature Loan Amount ranges from BDT 50,000 to BDT 1,000,000 (or 12 times of gross salary, whichever is lower). Repayment tenure of 12, 24, 36, 48 or 60 months. Payment option available starting after minimum 6 months of disbursement of loan. Early full and final settlement allowed. No security required. No hidden charges. Home Loan EBL introduces the most convenient & practical Home Loan that suits your all home financing needs. Let it be for apartment purchase, home construction, extension or renovation - EBL is here with the ultimate solution for you. With so many attractive features in it - the home you wanted to buy, or to extend the existing one or renovate the same is no longer a distant dream. Feature Loan amount BDT 500,000 – 75,00,000 or 50 times of applicant’s Gross Monthly Income, whichever is lower Repayment tenure 3 years to 20 years Attractive Interest rates based on loan amount: Loan Amount
Interest Rate
BDT 5 Lac to 15lac
14%
BDT 15 Lac+ to 25 Lac
14.25%
BDT 25 Lac+ to 40 Lac
14.5%
BDT 40 Lac+ to 75 Lac
15.00%
Deposit product
Interesting Account Interest calculated on daily balance Interest is credited to your account every month Competitive interest rate Unlimited cash withdrawal Available in all EBL Branches No extra terms and conditions EBL Campus - first time in Bangladesh a tailor made banking pack for students. Campus Account: Under “EBL Campus”, yet another wonderful product that directly takes you into the rewarding world of general banking. It’s your very own, very special savings account with no hidden charges or restrictions, while giving you very attractive interest on daily balance, Plus a super-smart plastic in your wallet! Feature Interest bearing deposit account Interest calculated on the basis of daily balance No hidden charges or restrictions apply with regard to interest payment No standing in bank branch queues for withdrawal of money Leads you into the smart ... modern world of electronic banking- ATMs, POS terminals, Kiosks etc. Card Products Lifestyle Card - Under “EBL Campus” it’s another brilliant offering- a solid, internationally branded prepaid card that suits the lifestyle of students. The best way to not only make a fashion statement, but also to control your spending all in style. Reload and use only when you need to. And rest assured about the safety & security that the VISA logo vouches for! A global branded VISA prepaid card Reloadable Round the clock access to large ATM network (over 85 Q-cash & VISA ATMs within Bangladesh) and a large network of POS terminals at different shops Discount on purchases available from many retail shops/outlets Having a bank account with EBL is not required Simple credit card
Introducing EBL SIMPLE Credit Cards.The first of its kind, a complete Credit Card with every benefit possible, and still offering you something extra. At work or leisure, experience the convenience of a Card that does everything with style and honesty. When you become a member of EBL SIMPLE Card Services family, you become a part of an exclusive club – entitled to first class financial advice, priority treatment and a growing range of courtesy services. We understand the value of your money. That is why we aim to give you the highest benefit at a minimum cost. Choose the card type that matches your requirement and experience the difference. Experience EBL Credit Cards. Experience SIMPLE Table: 9. promotional expenditure and profitability of Eastern Bank from 2004-2008. Year
Promotional Expenditure
Profitability
2004
25032969
483365228
2005
42266189
546496236
2006
61935652
513197847
2007
99194921
419142202
2008
139733665
798353197
Total
368163396
2760554710
Table: 9. promotional expenditure and profitability of Eastern Bank from 2004-2008. Promotional expenditure & profitibility 800000000 700000000 600000000 500000000 400000000 300000000 200000000 100000000 0
1 Year
2
3
Promotional Expenditue
4
5
Profitability
Promotional expenditure and profitability of Eastern Bank from 2004-2008: According to the above figure we have reached to find out that the trend of the promotional expenditure and profitability of the Eastern bank increased on the basis of year. Here profit has increased
massively in compared to the promotional expenditure that’s mean profit of the bank not only influenced by promotional expenditure but it is influenced by another activity but we just consider the promotional expenditure as an influential factor. In this diagram, in 2008 the profit increased massively which is around Tk798353197 but promotional expenditure has increased slightly which was near about Tk139733665.
Table: 10. Growth rate of promotional expenditure from 2004-2008 Year
Promotional Expenditure
Growth rate of P.E
2004
25032969
2005
42266189
68.8420938
2006
61935652
46.53711031
2007
99194921
60.15803144
2008
139733665
40.86776177
Total
368163396
216.4049973
Fig: 10. Growth rate of promotional expenditure from 2004-2008 Growth rate of promotional expenditure 2080 2060 2040 2020 2000 1980 1960 1
2
3 Year
4
5
Growth rate of P.E
Growth rate of promotional expenditure from 2004-2008: According to the above diagram growth rate of promotional expenditure of Eastern bank was more or less fluctuation. Some time growth rate increase drastically and some time has declined little amount. In 2005, growth rate increased at the maximum level that amount was 68.84 percent and the minimum growth rate was in 2008 and that amount was 1.54 percent.
Table: 11. Growth rate of profit from 2004-2008 Year
Profitability
Growth rate of profit
2004
483365228
2005
546496236
13.060726
2006
513197847
-6.093068315
2007
419142202
-18.32736547
2008
798353197
90.47311227
Total
2760554710
79.11340449
Fig: 11. Growth rate of profit from 2004-2008 Growth rate of profitability 2500 2000 1500 1000 500 0 -500
1
2 Year
3
4
5
Growth rate of profit
Growth rate of profit from 2004-2008: From the above demonstration, for the influencing promotional expenditure, the growth rate of profit has increased in each year except 2008 that amount was 90.48 percent but Eastern bank is first one in which we have found negative growth rate in 2007 and 2008. maximum growth rate decrease in2007 and the amount was -18.32 percent. Table: 12.Effect of promotional expenditure on growth rate of profits from 2004-2008
Year
Growth rate of P.E
Growth rate of profit
2005
68.8420938
13.060726
2006
46.53711031
-6.093068315
2007
60.15803144
-18.32736547
2008
40.86776177
90.47311227
216.4049973
79.11340449
2004
Fig: 12. Effect of promotional expenditure in profits from 2004-2008. Growth rate of promotional expenditure & profit 2500 2000 1500 1000 500 0 -500
1 Year
2
3
Growth rate of P.E
4
5
Growth rate of profit
Effect of promotional expenditure in profits from 2004-2008: According to the above diagram the promotional expenditure has inspired the profitability but it is not always. Some time it does not influence the growth rate of profit. In above diagram we see that growth rate of the promotional expenditure increase but it is not influencing profit that is why profit has gone in negative segment in 2006 and 2007. Regression of Easstern Bank Variables Entered/Removed (b) Mode Variables Variables l Entered Removed Method 1 expenditu . Enter re(a) a All requested variables entered. b Dependent Variable: profit Model Summary
Mode l R 1 .628(a)
Adjusted R Square R Square .395
.193
Std. Error of the Estimate 130646368. 70283
a Predictors: (Constant), expenditure ANOVA(b) Model 1
Sum of Squares Regressi 3338224 on 0078276 790.000 Residual 5120542 0965711 100.000 Total 8458766 1043987 900.000
df 1 3
Mean Square F 333822400 78276790.0 1.956 00 170684736 55237030.0 00
Sig. .256(a)
4
a Predictors: (Constant), expenditure b Dependent Variable: profit Coefficients(a)
Model 1
Unstandardized Coefficients Std. B Error 4062357 1195576 15.373 45.044
(Consta nt) expendit 1.981 ure
1.417
Standardized Coefficients Beta
.628
t
Sig.
3.398
.043
1.398
.256
a Dependent Variable: profit Prime bank In the backdrop of economic liberalization and financial sector reforms, a group of highly successful local entrepreneurs conceived an idea of floating a commercial bank with different outlook. For them, it was competence, excellence and consistent delivery of reliable service with superior value products. Accordingly, Prime Bank Ltd. was created and commencement of business started on 17th April 1995. The sponsors are reputed personalities in the field of trade and commerce and their stake ranges from shipping to textile and finance to energy etc. As a fully licensed commercial bank, Prime Bank Ltd. is being managed by a highly professional and dedicated team with long experience in banking. They constantly focus on
understanding and anticipating customer needs. As the banking scenario undergoes changes so is the bank and it repositions itself in the changed market condition. Prime Bank Ltd. has already made significant progress within a very short period of its existence. The bank has been graded as a top class bank in the country through internationally accepted CAMEL rating. The bank has already occupied an enviable position among its competitors after achieving success in all areas of business operation. Prime Bank Ltd. offers all kinds of Commercial Corporate and Personal Banking services covering all segments of society within the framework of Banking Company Act and rules and regulations laid down by our central bank. Diversification of products and services include Corporate Banking, Retail Banking and Consumer Banking right from industry to agriculture, and real state to software. The bank has consistently turned over good returns on Assets and Capital. During the year 2005, the bank has posted an operating profit of Tk.1520.34 million and its capital funds stood at Tk.3177.32 million. Out of this, Tk.1400 million consists of paid up capital by shareholders and Tk.1777.32 million represents reserves and retained earnings. The bank’s current capital adequacy ratio of 9.96% is in the market. In spite of complex business environment and default culture, quantum of classified loan in the bank is very insignificant and stood at less than 0.96%. Prime Bank Ltd., since its beginning has attached more importance in technology integration. In order to retain competitive edge, investment in technology is always a top agenda and under constant focus. Keeping the network within a reasonable limit, our strategy is to serve the customers through capacity building across multi delivery channels. Our past performance gives an indication of our strength. We are better placed and poised to take our customers through fast changing times and enable them compete more effectively in the market they operate. Public Relations Division It has to perform certain functions related to all types of communication. The broad routine functions can be enumerated as follows: i. Receiving and Sanctioning of all advertisement application ii. Keeping good relation with different newspaper offices. iii. Inviting concerned ones for any occasion. iv. Keeping good relation with different officers of electronic media. Marketing Division Marketing Division is involved in two types of Marketing. Asset marketing: Marketing of assets refers to marketing of various kinds of loans and advances. In-order to perform these jobs, they often visits dome large organizations and attract then to borrow from the Bank to finance profitable ventures. Liability Marketing: The process of Liability marketing is more of less same as Asset marketing. In this case different organizations having excess funds are solicited to deposit
their excess fund to the Bank. If the amount of money to be deposited is large, the Banks sometimes offer a bit higher price than the prevailing market rate. Islamic bank Bangladesh is one of the largest Muslim countries in the world. The people of this country are deeply committed to Islamic way of life as enshrined in the Holy Qur'an and the Sunnah. Naturally, it remains a deep cry in their hearts to fashion and design their economic lives in accordance with the precepts of Islam. The establishment of Islami Bank Bangladesh Limited on March 13, 1983, is the true reflection of this inner urge of its people, which started functioning with effect from March 30, 1983. This Bank is the first of its kind in Southeast Asia. It is committed to conduct all banking and investment activities on the basis of interestfree profit-loss sharing system. In doing so, it has unveiled a new horizon and ushered in a new silver lining of hope towards materializing a long cherished dream of the people of Bangladesh for doing their banking transactions in line with what is prescribed by Islam. With the active co-operation and participation of Islamic Development Bank (IDB) and some other Islamic banks, financial institutions, government bodies and eminent personalities of the Middle East and the Gulf countries, Islami Bank Bangladesh Limited has by now earned the unique position of a leading private commercial bank in Bangladesh. Aims and Objectives To conduct interest-free banking. To establish participatory banking instead of banking on debtor-creditor relationship. To invest on profit and risk sharing basis. To accept deposits on Mudaraba & Al-Wadeah basis. To establish a welfare-oriented banking system. To extend co-operation to the poor, the helpless and the low-income group for their economic upliftment. To play a vital role in human development and employment generation. To contribute towards balanced growth and development of the country through investment operations particularly in the less developed areas. To contribute in achieving the ultimate goal of Islamic economic system.
Table: 13.Promotional expenditure and profitability of Prime Bank from 2003-2007.
Year
promotional expenditure
Profit
2003
39020931
375455447
2004
44528648
611938344
2005
54154447
568196286
2006
63382686
1047543547
2007
121848451
1398792999
Total
322935163
4001926623
Fig: 13. Promotional expenditure and profitability of Prime Bank from 2003-2007. Promotional expenditure and profit 1600000000 1400000000 1200000000 1000000000 800000000 600000000 400000000 200000000 0 1
2 Year
3
4
promotional expenditure
5 Profit
Promotional expenditure and profitability of Prime bank from 2003-2007: According to the figure 13 we have reached to find out that the trend of the promotional expenditure and profitability of the AB bank is increasing on the basis of year. Hear profit has increased massively in compared to the promotional expenditure that’s mean profit of the bank not only influenced by promotional expenditure but it is influenced by another activity but we just consider the promotional expenditure as an influential factor. In this diagram, in 2007 expenditure and profit both has maximized which amount wereTk121848451 and Tk 1398792999. Table: 14. Growth rate of promotional expenditure from 2003-2007 Year
promotional expenditure
Growth rate of P.E
2003
39020931
2004
44528648
14.11477599
2005
54154447
21.61709244
2006
63382686
17.04059318
2007
121848451
92.24248559
Total
322935163
165.0301751
Fig: 14. Growth rate of promotional expenditure from 2003-2007 Growth rate of promotional expenditure 2100 2080 2060 2040 2020 2000 1980 1960 1940
1
2 Year
3
4
5
Growth rate of P.E
Growth rate of promotional expenditure from 2003-2007: According to the above diagram growth rate of promotional expenditure of Prime bank was not more or less fluctuation. In 2007, growth rate increased at the maximum level that amount was 92.24 percent and the minimum growth rate was in 2004 and that amount was 14.11 percent. Fig: 15. Grwth rate of profit from 2003-3007 Year
Profit
2003
375455447
2004
611938344
62.98560825
2005
568196286
-7.148115236
2006
1047543547
84.36296977
2007
1398792999
33.5307733
Total
4001926623
186.0985597
Fig: 15. Grwth rate of profit from 2003-3007
growth rate of profit
Growth rate of profit 2500 2000 1500 1000 500 0 -500
1
2 Year
3
4
5
growth rate of profit
Growth rate of profit from 2003-2007: From the above demonstration, for the influencing promotional expenditure, the growth rate of profit has fluctuated. In 2006 the rate was maximumthat amount was 84.36 percent but Prime bank is another one in which we have found negative growth rate in 2005 and amount was -7.14 percent. Table: 16. Effect of growth rate of promotional expenditure on growth rate of profit from 2003-2004 Year
Growth rate of P.E
growth rate of profit
2004
14.11477599
62.98560825
2005
21.61709244
-7.148115236
2006
17.04059318
84.36296977
2007
92.24248559
33.5307733
Total
165.0301751
186.0985597
2003
Fig: 16.Effect of growth rate of promotional expenditure on growth rate of profit from 2003-2007.
Effect of growth rate on growth rate of the profit 100% 80% 60% 40% 20% 0% -20%
1 Year
2
3
Growth rate of P.E
4
5
growth rate of profit
Effect of promotional expenditure in profits from 2003-2007: According to the above diagram the promotional expenditure has inspired the profitability but it is not always. Some time it does not influence the growth rate of profit. In above diagram we see that growth rate of the promotional expenditure increase but it is not influencing profit that is why profit has gone in negative segment in 2005. Regression of Prime Bank Variables Entered/Removed(b) Mode Variables Variables l Entered Removed 1 expenditu . re(a)
Method Enter
a All requested variables entered. b Dependent Variable: profit Model Summary Mode l R 1 .922(a)
Adjusted R Square R Square .850
.800
Std. Error of the Estimate 185517686. 12142
a Predictors: (Constant), expenditure ANOVA(b) Model
Sum of Squares df
Mean Square
F
Sig.
1
Regressi 5859179 on 1110960 1 7000.000 Residual 1032504 3559153 3 6700.000 Total 6891683 4670114 4 4000.000
585917911 109607000. 17.024 000 344168118 63845590.0 00
.026(a)
a Predictors: (Constant), expenditure b Dependent Variable: profit Coefficients(a)
Model 1
Unstandardized Coefficients Std. B Error 5886715 1979431 9.402 68.365
(Consta nt) expendit 11.481 ure
2.783
Standardized Coefficients Beta
.922
t
Sig.
.297
.786
4.126
.026
a Dependent Variable: profit BRAC bank BRAC Bank Limited, with institutional shareholdings by BRAC, International Finance Corporation (IFC) and Shorecap International, has been the fastest growing Bank from 2004 to 2007. The Bank operates under a "double bottom line" agenda where profit and social responsibility go hand in hand as it strives towards a poverty-free, enlightened Bangladesh. A fully operational Commercial Bank, BRAC Bank focuses on pursuing unexplored market niches in the Small and Medium Enterprise Business, which hitherto has remained largely untapped within the country. In the last six years of operation, the Bank has disbursed over BDT 7500 crore in loans to nearly 200,000 small and medium entrepreneurs. The management of the Bank believes that this sector of the economy can contribute the most to the rapid generation of employment in Bangladesh. Since inception in July 2001, the Bank's footprint has grown to 56 branches, 30 SME Service Centers, 427 SME unit offices and 112 ATM sites across the country, and the customer base has expanded to 465,000 deposit and 187,000 advance accounts till December 2008. In the years ahead BRAC Bank expects to introduce many more services and products as well as add a wider network of SME unit offices, Retail Branches and ATMs across the country.
BRAC
BRAC, a national, private organization, started as an almost entirely donor funded, smallscale relief and rehabilitaton project initiated by Fazle Hasan Abed to help the country overcome the devastation and trauma of the Liberation War and focused on resettling refugees returning from India. Today, BRAC has emerged as an independent, virtually selffinanced paradigm in sustainable human development. It is one of the largest Southern development organizations employing 97,192 people, with 61% women, and working with the twin objectives of poverty alleviation and empowerment of the poor. Product and service SME Banking Retail Banking Probashi Banking Corporate Banking
SME Banking The most valuable natural resource of Bangladesh is its people. As a nation we struggled for our independence and now the attainment of economic uplift is the main goal. Micro lenders are working here in the financial field, providing very small amount and on the other hand regular commercial banks have been providing bigger amount of loans to larger industries and trading organizations. But the small and medium entrepreneurs were overlooked. This missing middle group is the small but striving entrepreneurs, who because of lack of fund cannot pursue their financial uplift, as they have no property to provide as equity to the commercial banks. With this end in view-BRAC Bank was opened to serve these small but hard working entrepreneurs with double bottom line vision. As a socially responsible bank, BRAC Bank wants to see the emancipation of grass-roots level to their economic height and also to make profit by serving the interest of missing middle groups. 50% of our total portfolio usually collected from urban areas, are channeled to support these entrepreneurs who in future will become the potential strength of our economy. We are the market leaders in giving loans to Small and Medium Entrepreneurs. We have been doing it for the last five years. SME Product Aroggo Rin “Aroggo” is a loan allowed to various Health service Provider like private clinics, diagnostics centers and doctors' chambers. The product offers fixed assets purchase financing under equated Monthly Installments
Pathshala Rin “Pathshala Rin” is a loan designed to meet the needs of small and medium sized private educational institutions, such as kindergartens, schools and colleges etc.
Retail banking In which bank provide loan to general customer. Salary Loan Keep an extra 15 month's salary in your pocket. You can get BRAC Bank Salary loan, Loan against your salary. If you are a salaried individual working in Bangladesh, Please read on. Because Salary Loan from BRAC Bank has been designed with just you in our minds. Car Loan Why toy with your dreams when you can own one', BRAC Bank Car Loan can stop your dreaming and Start driving Whether you want to purchase a brand new car or a reconditioned one, we have the most customer-friendly car loan scheme available for you. Corporate Banking Corporate Loan Products Trade Finance Corporate Cash Management Probashi Banking
Table: 17.Promotional expenditure and profitability from 2003-2007. Year
Promotional expenditure
Profitability
2003
9093791
30280682
2004
30258517
99302749
2005
56620255
192680101
2006
100201029
334261127
2007
134980937
618335637
331154529
1274860296
Fig: 17.Promotional expenditure and profitability from 2003-2007. Promotional expenditue & profitability 700000000 600000000 500000000 400000000 300000000 200000000 100000000 0
1 Year
2
3
Promotional expenditure
4
5
Profitability
Promotional expenditure and profitability from 2003-2007: According to the above figure we have reached to find out that the trend of the promotional expenditure and profitability of the Prime bank increased on the basis of year. Here profit has increased massively in compared to the promotional expenditure that’s mean profit of the bank not only influenced by promotional expenditure but it is influenced by another activity but here we just consider the promotional expenditure as an influential factor. In this diagram, in 2007 the profit
increased massively which is around Tk 618335637 but promotional expenditure has increased slightly which was near about Tk134980937.
Table: 18. Growth rate of promotional expenditure from 2003-2007 Year
Promotional expenditure
Growth rate of P.E
2003
9093791
2004
30258517
232.7382057
2005
56620255
87.12171188
2006
100201029
76.97028917
2007
134980937
34.71013057
331154529
431.5403373
Fig: 18. Growth rate of promotional expenditure from 2003-2007 Growth rate of promotional expenditure 2250 2200 2150 2100 2050 2000 1950 1900 1850
1
2 Year
3
4
5
Growth rate of P.E
Growth rate of promotional expenditure from 2003-2007: From the above demonstration, for the influencing promotional expenditure, the growth rate of promotional expenditure has decreased. In 2004 growth rate of promotional expenditure was maximum and the amount was 232.75 and in 2007 growth rate was minimum. Table: 19. Growth rate of profit from 2003-2007 Year
Profitability
2003
30280682
Growth rate of profit
2004
99302749
227.9409262
2005
192680101
94.03299802
2006
334261127
73.47983796
2007
618335637
84.98580512
1274860296
480.4395673
Fig: 19. Growth rate of profit from 2003-2007 Growth rate of profit 2250 2200 2150 2100 2050 2000 1950 1900 1850
1
2 Year
3
4
5
Growth rate of profit
Fig: 19. Growth rate of profit from 2003-2007: According to the above diagram growth rate of profit of BRAC bank was more or less fluctuation. In 2004, growth rate increased at the maximum level that amount was 227.94 percent and the minimum growth rate was in 2007 and that amount was 84.98 percent. Table: 20.Effect of promotional expenditure in profits from 2003-2007. Year
Growth rate of P.E
Growth rate of profit
2004
232.7382057
227.9409262
2005
87.12171188
94.03299802
2006
76.97028917
73.47983796
2007
34.71013057
84.98580512
431.5403373
480.4395673
2003
Table: 20.Effect of promotional expenditure in profits from 2003-2007. Growth rate of promotional expenditure & profitability 2500 2000 1500 1000 500 0
1 Year
2
3
Growth rate of P.E
4
5
Growth rate of profit
Effect of promotional expenditure in profits from 2003-2007: According to the above diagram the promotional expenditure has inspired the profitability of BRAC bank. In this diagram in compared to the promotional expenditure, growth of profitability increase more. Both maxmimu growth rate of profit and promotional expenditure was in 2004. Regression BRAC Bank Variables Entered/Removed (b) Mode Variables Variables l Entered Removed Method 1 expenditu . Enter re(a) a All requested variables entered. b Dependent Variable: profit Model Summary Mode l R 1 .977(a)
Adjusted R Square R Square .955
.940
Std. Error of the Estimate 56970399.5 1135
a Predictors: (Constant), expenditure ANOVA (b) Model 1
Sum of Squares df Regressi 2071824 on 0386532 1 6800.000 Residual 9736879 3 2614498
Mean Square F 207182403 865326800. 63.834 000 324562642 0483294.00
Sig. .004(a)
80.000 Total 2169192 8312677 4 6700.000 a Predictors: (Constant), expenditure b Dependent Variable: profit
0
Coefficients (a)
Model 1
(Consta nt)
Unstandardized Coefficients Std. B Error 4473221 3878662 2.510 0.144
expendit 4.435 ure a Dependent Variable: profit
.555
Standardized Coefficients Beta
.977
t
Sig.
-.867
.450
7.990
.004
Trust Bank Trust Bank Limited is one of the leading private commercial bank having a spread network of 39 branches across Bangladesh and plans to open few more branches to cover the important commercial areas in Dhaka, Chittagong, Sylhet and other areas in 2008. The bank, sponsored by the Army Welfare Trust (AWT), is first of its kind in the country. With a wide range of modern corporate and consumer financial products Trust Bank has been operating in Bangladesh since 1999 and has achieved public confidence as a sound and stable bank. In 2001, the bank introduced automated branch banking system to increase efficiency and improve customer service. In the year 2005, the bank moved one step further and introduced ATM services for its customers. Since bank’s business volume increased over the years and the demands of the customers enlarged in manifold, our technology has been upgraded to manage the growth of the bank and meet the demands of our customers. In January 2007, Trust Bank successfully launched Online Banking Services which facilitate Any Branch Banking, ATM Banking, Phone Banking, SMS Banking, & Internet Banking to all customers. Customers can now deposit or withdraw money from any Branch of Trust Bank nationwide without needing to open multiple accounts in multiple Branches. Via Online Services and Visa Electron (Debit Card), ATMs now allow customers to retrieve 24x7 hours Account information such as account balance checkup through mini-statements and cash withdrawals. Trust Bank is about to introduce Visa Credit Cards to serve it’s existing and potential valued customers. Credits cards can now be used at shops & restaurants all around Bangladesh and even internationally.
Trust Bank is a customer oriented financial institution. It remains dedicated to meet up with the ever growing expectations of the customer because at Trust Bank, customer is always at the center Product and service Current Deposit Account Current Deposit Account is the net flow of current transactions with no restriction, including services and interest payments. Savings Deposit Account A Saving Bank account (SB account) is meant to promote the habit of saving among the people. It also facilitates safekeeping of money. Short Term Deposit Account Short Term Deposit Account is the net flow of current transactions including services and interest payments. Fixed Deposit Account A fixed deposit is meant for those investors who want to deposit a lump sum of money for a fixed period; say for a minimum period of 30 days to one year. Trust Smart Savers Scheme (TSSS) The name of the scheme is 'Trust Smart Savers Scheme (TSSS)' and an Account holder subscribing to this scheme will be called TSSS Account holder. Trust Money Double Scheme (TMDS) The objective of this scheme is to double the deposited amount. Trust Money Making Scheme (TMMS) Information about Trust Money Making Scheme (TMMS). Trust Educare Scheme (TES) Students who are eligible to receive refunds from Bank are encouraged to enroll in this deposit. Table: 21.Promotional expenditure and profitability from 2005-2007. Year
Promotional Expenditure
Profit
2005
6038525
121286368
2006
8793963
262695349
2007
18145148
239028693
Total
32977636
623010410
Fig: 21.Promotional expenditure and profitability from 2005-2007. Promotional expenditure and profit 300000000 250000000 200000000 150000000 100000000 50000000 0
1 Year
2
3
Promotional Expenditure
Profit
Promotional expenditure and profitability from 2005-2007: According to the above figure we have reached to find out that the trend of the promotional expenditure and profitability of the Prime bank increased on the basis of year. Here profit has increased massively in compared to the promotional expenditure that’s mean profit of the bank not only influenced by promotional expenditure but it is influenced by another activity but here we just consider the promotional expenditure as an influential factor. In this diagram, in 2006 the profit increased massively which is around Tk262695349 but in 2007 promotional expenditure has increased slightly which was near about Tk18145148 Table: 22. Growth rate of promotional expenditure from 2005-2007 Year
Promotional Expenditure
Growth rate of P.E
2005
6038525
2006
8793963
45.63097776
2007
18145148
106.3364151
Total
32977636
81.74354929
Fig: 22. Growth rate of promotional expenditure from 2005-2007
Growth rate of promotional expenditure
2150 2100 2050 2000 1950
1
2 Year
3
Growth rate of P.E
Growth rate of promotional expenditure from 2005-2007: From the above demonstration, for the influencing promotional expenditure, the growth rate of promotional expenditure has increased in each year. In 2007 growth rate of promotional expenditure was maximum and the amount was 106.33 and in 2005 growth rate was minimum. Table: 23. Growth rate of profit from 2005-2007 Year
Profit
2005
121286368
2006
262695349
116.5909931
2007
239028693
-9.009164452
Total
623010410
160.6425204
Fig: 23. Growth rate of profit from 2005-2007
Growth rate of P
Growth rate of profit
2500 2000 1500 1000 500 0 -500
1
2 Year
3
Growth rate of P
Fig: 23. Growth rate of profit from 2005-2007: According to the above diagram growth rate of profit of trust bank was more or less fluctuation. In 2006, growth rate increased at the maximum level that amount was 116.59 percent and the minimum growth rate was in 2007 and that amount was -9 percent. Regression of Trust Bank Variables Entered/Removed(b) Mode Variables Variables l Entered Removed Method 1 Expenditu . Enter re(a) a All requested variables entered. b Dependent Variable: Profit Model Summary Mode l R 1 .553(a)
Adjusted R Square R Square .305
-.389
a Predictors: (Constant), Expenditure
Std. Error of the Estimate 89267755.9 8016
ANOVA(b) Model 1
Sum of Squares Regressi 3504556 on 2789617 04.000 Residual 7968732 2577337 30.000 Total 1147328 8536695 430.000
df 1 1
Mean Square F 350455627 8961704.00 .440 0 796873225 7733730.00 0
Sig. .627(a)
2
a Predictors: (Constant), Expenditure b Dependent Variable: Profit Coefficients(a)
Model 1
Unstandardized Coefficients Std. B Error 1351564 1208823 01.157 50.619
(Consta nt) Expendi 6.597 ture
9.947
Standardized Coefficients Beta
.553
t
Sig.
1.118
.465
.663
.627
a Dependent Variable: Profit Analysis Bank
Total promotional expenditure
Total profit
AB bank
179969870
4988822041
IBL
347118546
8263910724
EBL
368163396
2760554710
BRAC
331154529
1274860296
Prime bank
322935163
4001926623
Trust bank
32977636
623010410
Analysis 10000000000 8000000000 6000000000 4000000000 2000000000 0
AB bank
IBL
EBL
BRAC
Total promotional expenditure
Prime bank
Trust bank
Total profit
Analysis: According to the above diagram the promotional expenditure influence profit of each bank. On the above diagram the maximum profit has gained by the Islaimi bank and the amount was Tk 8263910724 and minimum profit has achieved by Trust bank and that amount was Tk623010410. So the question ‘“The Effect of Promotional Expenditure of Commercial Bank on Profit of Bank”is null hyphothesis. Recommendation 1. Commercial bank should increase the promotional activity. Advertisement electrinc media. Advertisement in print media. Advertisement in billboard. Personal selling 2. Promotional activity directly increases the basic earning power, profit that is why it increases the earning per share, retained earning and dividend payment. So commercial bank should increase the budget for promotional expenditure. 3. Promotional expenditure for promotional activity directly influence the customer that’s why profit of bank increase on yearly basis. 4. It increases the brand image of bank to the customer. 5. The Effect of Promotional Expenditure of Commercial Bank on Profit of Bank is null hyphothesis which indicate promotional expenditure can influence the profit of bank. Conclusion ‘The effect of promotional expenditure of commertial bank influence on its profitability’ this is actually the hypothetical question. The answer of this question can be one hypothesis or null hypothesis. Here we are abled to find out the answer of this question that the promotional expenditure of commercial bank effect on profit because according to the whole analysis of graph of each bank every year profit is increasing as well as promotional expendioture. Those
sort of promotional activity play vitle role on the customer’s psychology that is why the commercial bank try to incease their promotional expenditure in each year and we have found growth rate of promotional expenditure and growth rate of profit also increased except one or two year. So finally we can conclude that promotional expenditure has effect on the profit of bank. Reference: Annual report of AB bank Ltd. Annual report of Islami bank Ltd. Annual report of Eastern bank Ltd. Annual report of Prime bank Ltd. Annual report of BRAC bank Ltd. Annual report of Trust bank Ltd. www.ebl.com.bd www.primebank.com.bd] www.trustbank.com.bd www.islamibankbd.com