A Project on SME Loan Of BRAC Bank Limited

Executive Summary

BRAC Bank Limited is a scheduled commercial bank in Bangladesh. It established in Bangladesh under the Banking Companies Act, 1991 and incorporated as private limited company on May 20, 1999 under the Companies Act, 1994. Its operation started on July 4, 2001 with a vision to be the market leader through providing all sorts of support to people in term of promoting corporate and small entrepreneurs and individuals all over the country. BRAC Bank, for the first time among local commercial banks, starts providing loan facilities to small and medium trading, manufacturing and service oriented enterprises all over the country. The bank has already established its network in different area of the country with assistance of BRAC.

BRAC Bank is trying to develop economic condition of the country. So the bank provides loan facility 2 to 30 lacs taka to the small and medium enterprise that has no easy access to financial institutes. The bank already established 36 Zones and 265 unit offices all over the country. There are 583 Customer Relation Officers (CRO) providing door to door service to clients. Till December 2006, the bank provides loan facilities to 14482 clients which amount is Tk 556.64 crore. Average loan size is Tk 3.28 lacs. SME loan can be repaid in two ways, 1) In equal monthly loan installment with monthly interest payment. 2) By one single payment at maturity, with interest repayable a quarter ends residual on maturity. Customer relation officer search new potential customer by providing door to door service. They talk with clients and monitor their manners, activities of their business and provide the loan to the potential customers. SME, BRAC Bank may provide 100% of net required working capital but not exceeding 75% of the aggregate value of the inventory and account receivable. Normally, organizations meet their working capital from over draft loan but BRAC Bank designed the loan to meet working capital but as term loan which is repaid in installment. The customer relation officers also monitor the borrower’s activities after the loan disbursement. The core competence of the BRAC Bank is to provide the fastest loans to the clients in this country. To retain this competitive advantage BRAC Bank would provide computer and palmtop facilities whether they can give fastest services to clients than other banks. Also to convey the customer focus, BRAC Bank is trying to reduce collateral securities than other banks. It provides more collateral free secured loans to capture the market. Regarding the services by the CRO, almost all clients are satisfied by get these quick facilities from them. Though it is pioneer division of this bank, I tried to give an in-depth analysis for every factor, which relates the SME division from the perspective of customer satisfaction and dissatisfaction. 

1.1 Origin of the Report

A country is financially rich when it has modern financial institutions of its own. These institutions play a vital role in the field of financial stability and industrial development of the country. Due to Globalization and Technological revolution, the banking business has become very competitive now a days. All banks are competing to give effective real time service to their customers. For giving friendly service to the customers they need experienced and well-educated workforce. To create well-educated Business executives, Dhaka University has initiated Bachelors of Business Administration (BBA) program. In the BBA Program, the Internship is one of the vital parts but in lieu of internship, project can be prepared if it is unavailable, which has to be done by every BBA Student. For fulfilling that requirement I was assigned to prepare a project on SME loan of BRAC Bank. My faculty supervisor Sheheli Parvin, lecturer, Department of Marketing, Dhaka University also approved the project and authorized me.

Presentation on Entrepreneurship Development

Entrepreneur

An entrepreneur is defined as “person in effective control of commercial undertaking; one who undertakes a business or an enterprise”.

Entrepreneur is an innovative person who maximizes his profits by following new strategies or venturing into new products or services.

Entrepreneurship 

Entrepreneurship is the act of being an entrepreneur, who starts any economic activity for being self-employed.

Entrepreneurship   is the “process of the entrepreneur”. It is an attempt to create value through recognition of business opportunity. It is basically communicative and management functions to mobilize financial and material resources.

The entrepreneurial activity is governed by varying combination of socio-economic, psychological, cultural and other factors: Caste/religion, Family background, Level of education, Level of perception, Occupational background, Migratory character, Entry into entrepreneurship, Nature of enterprise, Investment capacity and Ambition/moderation.

Presentation of Comparison Between Basel I and Basel II

Background of Basel Committee

¢Named after Basel, Switzerland.

¢Formed in 1974 after the liquidation of Bank Herstatt.

¢Introduced by G-10 countries

¢Developed Under auspices of Bank for International Settlement

Function: regular cooperation on banking supervisory matters.


Basel Committee an Overview

¢Membership: The central bank Governors of the Group Ten.

¢Frequency of meetings: The Basel Committee usually meets four times per year

¢Reporting arrangements: reports to a joint committee of central bank Governors

¢Outreach: maintains links with supervisors not directly participating in the committee

¢Main subgroups:

—The Accord Implementation Group

—The Policy Development Group

—The Accounting Task Force

The International Liaison Group   



Basel Accord I

¢Aimed to standardized the computation of risk based capital across banks and across  countries.

¢Issued in 1988 by the Basel Committee on Banking Supervision, a group of banking supervisors which secretariat is based at the Bank for International Settlements in Basel, Switzerland.

Presentation on How to present in Public Place

Presentations

What is Communication?

Nonverbal Communication

  -body language

  -eye contact

Importance of Communication

• Class Presentations                     
• 
  
• Field Research
• 
  
• Business Communications
• 
  
• Public Speaking

Fear of Public Speaking

. Population 

. No.1 fear=Public Speaking         

. Fear No.2=Death

. Stage fright

  -In spotlight

  -unprepared

  -inexperienced



Effective Communication

. Preparation         
. Practice
. Presence 

Effective Communication

Preparation

. Research    - Non-research

. Format  -speak on what you know             

      -Notes- outline main points

  -note cards vs. full sized paper

Presentation on Traffic Jam inThe DHAKA City

Traffic Jam and It’s Economic Impact

Traffic jam of the Dhaka city costs over Tk. 19,000 crore a year.

The city losses 8.16 million work hours daily.

Causes of Traffic Jam

Significant increase in population and centralization.

 Simultaneous presence of motorized and non-motorized    vehicles on  the same street.

 Traffic mismanagement: Violation of Traffic rules and regulations.

 Poor transportation and infrastructure planning Other Issues.

INCREASED POPULATION AND    CENTRALIZATION

Dhaka is the head quarter of all type of organization.

The increasing population obviously increases the demand for more vehicles on the streets.

Presentation on Practices and Challenges of Corporate Governance in Bangladesh

Corporate Governance

Corporate governance (CG) is a broader issue than corporate management and includes concerns like efficient and transparent administration, ethical commitment, quality of financial and management disclosures, safeguarding legitimate interest of all shareholders, ensuring independence of the entity etc.

Principles of CG

—Ensuring rights of all shareholders,

—Integrity and ethical behavior,

—Appropriate disclosure and transparency and

—Proper role and responsibilities of the board and so on.

Issues involved in CG principles

—Management risk

—Internal control

—Oversight of preparation of the financial disclosures

—Independence of the external auditor and quality of audit

—Review compensation package of the Chief Executive Officer (CEO) and other top executives

— Nomination in the board

— Dividend policy and other related issues.

Presentation on The 7 habits Of highly effective people

Habit # 01

Proactive
-Principle of Personal Choice

• — Proactive people focus their efforts in their circle of influence, causing the circle of influence to increase.

•  Reactive people focus their effort in the circle of concern. The negative energy generated by that focus causes the circle of influence to shrink.

Choose your Language!

"Success doesn't come to you…you go to it.”

- Marva Collins