Internship report on General Banking, Investment, Risk Management and Foreign Exchange Operation Of Social Islami Bank Ltd

Now-a-days bank business comprise a large and growing portion of the world’s total business Like in many other emerging market economies, commercial banks in the Bangladesh economy are to face an increasing competition for their business in the coming days. This business will no longer remain easy as they had earlier
A Bank is usually defined as an institution that deals in money. Today, however, the functions of a bank have an increased so much that is considered as a very vital agent of development in a country like ours. Because of their positive involvement in trade, industry, business, finance and a host of other allied services, banks today represent very important part of any economy.

This report is a thesis report and prepared for Business Administration Department of Victoria University of Bangladesh as a partial requirement of six credits thesis program. The prime purpose of the report is to study the operational aspects and performance of a financial institution of Bangladesh. For the completion of the report I have selected ‘Social Islamic Bank Ltd’, a leading and outstanding Islamic Shariah based private commercial Bank.

Social Islami Bank Ltd. (SIBL) started its operation on the 22nd November, 1995 as a Second Generation Islamic Bank in close co-operation and assistance of some renowned personalities of the Islamic world. It works as an Islamic participatory Commercial Bank with human face approach to credit and banking on the profit and loss sharing; it is a Non-formal banking with informal finance and credit package that empowers and humanizes real poor family and create local income opportunities and discourages internal migration; it is a Development Bank intended to monetize the voluntary sector and management of Waqf, Mosque properties, Non-Muslim Trust Properties in the Country. In the formal corporate sector, this Bank would, among others, offer the most up to date banking services through opening of various types of deposit and investment accounts, financing trade, providing letters of guarantee, opening letters of credit, collecting of bills, effecting domestic and international transfer, leasing of equipment and consumers durable, hire purchase and installment sale for capital goods. Investment in low-cost housing and management of real estates, participatory investment in various industrial, agricultural, transport, educational and health projects and so on.

In addition, SIBL offers Special services for the Bangladeshi expatriates which include managing their foreign currency accounts, providing express home remittance services, introducing Cooperative Investment schemes, Foreign Wage Earners Rehabilitation Scheme, etc. At the operational level, all three sectors activities would be mutually interdependent through Social Fund, social assignment Schemes, thereby making all these activities economically, socially and ethically transparent and revealed, once they are operationalized.

This report is especially focused on the ‘General Banking, Investment & risk management and foreign exchange operation’ of Social Islamic Bank, Banani Branch. There is also a part that describes the performance of these three departments in different years.

The second part of the report is consists of eight segments. In the first two segments, I have presented the details of study and methodological aspects of the thesis report. Then in the third segment, I gave an overview of Social Islamic Bank Ltd. The next three segments have explained the core activities of General Banking, Investment & risk management and Foreign Exchange Department. I have demonstrated all the practical and theoretical experience and observations I have gained through my thesis program, in this report. The seventh segment of the report has illustrated a year-wise overall performance, deposit, investment and foreign exchange business position of the Social Islamic Bank Ltd. Last but not the least, in the eighth segment, I have summarized the findings of the report and also tried to recommend some prime necessities to increase the efficiency of Social Islamic Bank in the competitive market of private commercial bank.

Modern banking system plays a vital role for a nation’s economic development. Over the last few years the banking world has been undergoing a lot of changes due to deregulation, technological innovations, globalization etc. These changes also made revolutionary changes of a country’s economy. Present world is changing rapidly to face the challenge of competitive free market economy. It is well recognized that there is an urgent need for better-qualified management and better-trained staff in the dynamic global financial market. Bangladesh is no exception of this trend. Banking sector in Bangladesh is facing challenges from different angles though its prospect is bright in the future. Money and banking is the center around which all economic science clusters. Hence the educational institutions are giving emphasis on the applied part of banking education. This report has been prepared as an integral part of MBA program under the Department of Business Administration, Victoria University of Bangladesh.

1.2 Statement of the Problem
Banking industry consists of 3 sectors: i) Central Banking ii) Commercial Banking and iii) Specialized Banking. Based on the nature of main source of earning commercial banks can be divided in to 2 groups a) Conventional Banking and b) Islamic Banking. A number of studies have been conducted in the area of conventional banking; but a few numbers of studies have been done in the area of Islamic banking sector. This sector has been pursuing the policy of expansion and growth of branches. How far the policy of expansion is associated with the dynamics of performance measures of Islamic banks is yet to be investigated. In an attempt to examine the dynamics of performances of an Islamic bank, a case study on an Islamic bank has been done. Social Islami Bank Limited was selected for the study purpose.

1.3 Objective of the Study
The general objective of preparing this report is to fulfill the requirement of Thesis Report as well as completion the MBA Program through gaining the practical experience and view the application of theoretical knowledge in the real life. The report focuses on two parts. They are:
1.3.1 Primary Objective-
The broad project objective is to identify the features of SIBL’s major business activities.
1.3.2 Secondary Objectives-
In order to reach the broad objective, some specific objectives are identified.
To present an overview of Social Islami Bank Limited.
To provide an overview of the existing product and services offered by Social Islami Bank.
To identify the problems of Social Islami Bank Limited those are currently facing.
To identify the strengths and weaknesses.
To suggest remedial measures for the development of Social Islami Bank Limited.

1.4 Limitations of the Study
Result that will appear after conducting this study may not reflect the same situation for all the other branches of SIBL’s as this study is only based on the opinions of respondents of the SIBL Banani Branch.
This research may not contain the actual scenario of the respected topic because of the time constraint; I couldn’t manage to conduct any type of survey.
· Due to time limitation many aspects may not be discussed in the study.
Every organization has their own secrecy that in not revealed to others. This might be another problem for which the result can be manipulated.