Internship Report On Evaluation of Investment Performance of Islami Bank Bangladesh Limited

Our economy is largely dependent on foreign exchange business specially remittance. Expatriates are remitting huge amount of foreign currencies which hugely contribute to our national income. Moreover export import business has always been an important source of our national income. Since the very inception IBBL has been playing pioneering role in channeling foreign currencies to our economy. Now IBBL happens to be on the driving seat in this arena. In no way we can overlook their contribution in this regard. Islamic banking is relatively a new concept in the world. Before the inception of Islamic banking phenomenon, banks were institutes to be avoided by the millions of Muslims. Keeping aloof themselves from banking, Muslims began to lose their market in the world economy.

As the competition of the Business world became more and more severe, businessmen had no alternative banking premises and many of them were getting involved in the traditional banking. But the traditional banking is based on interest, which is fully prohibited in Islam. To overcome this problem, Muslim scholars, philosophers, economists etc, were thinking to establish a new interest free banking stricture right from the 1940’s. At last they succeeded to formulate an appropriate Islamic banking structure. Islamic banks do not give more importance only on earning profit but also try to ensure social welfare in term of its activities.

This report has shown that the Islami Bank Bangladesh Limited is pioneer in introducing Shari’ah based interest free banking in Bangladesh with a mission to establish welfare oriented banking system and to ensure equity and justice in the field of all economic activities. This report mostly focuses on foreign exchange business of IBBL.

1.1 Origin of the report

After the completion of theoretical courses of program of Bachelor of Business Administration (BBA), each student is required to do intern in different organizations to have some practical knowledge and experience of the job exposure and to be familiar with the official environment thereof.

The paper is prepared based on an internship program. This is a requirement of the internship program arranged by Department of Banking, Faculty of Business studies, University of Dhaka. Each intern must carry out a specific project paper, which is assigned by the supervisor approved by the Department of Banking, Faculty of Business Studies, University of Dhaka.

As I had been selected for the Islami Bank Bangladesh Limited (IBBL) by the bank I started my realistic orientation program in Torki branch of IBBL.

The project paper is titled as “Evaluation of Foreign Exchange Business of IBBL”

1.2 Scope of the study

Islami Bank Bangladesh Ltd. is the leading Islamic bank in Bangladesh. The report covers the organizational structure, background, objectives, functions and the foreign exchange business performance of the bank and its evaluation. The scope is limited to foreign exchange business operation procedure, instruments used, modes of financing, modes of payments, settlement procedure, use of funds, treasury management and detailed Shari’ah aspect regarding foreign exchange business.

1.3 Objective of the study

The pivotal objective of this study is to give an overview of the practical knowledge and experience that I have gathered during my internship period in Islami Bank Bangladesh Limited. This study aims at evaluating foreign exchange business of IBBL. In addition, the study seeks to achieve the following specific objectives:

§ To find out the overall pictures of Foreign exchange business of IBBL.
§ To explore Islamic Shariah aspects and financing modes regarding Foreign exchange business.
To evaluate Foreign exchange business performance of IBBL.
To find out the impact of world financial crisis (if any) on IBBL’s Foreign exchange business.
To understand the contribution of IBBL in the economy’s foreign exchange business.

1.4 Methodology

A) Sources of data:
There are two sources of data have been used and most of the data are collected from the secondary sources. The sources are-
Primary Sources:
Interviewing the bank officials of forex division and
Official records and observing practical work
Secondary Sources:

a. Annual reports of IBBL,
b. Published Booklets/Manuals of the Bank,
c. Training materials form IBTRA
d. Website of the Bank, Bangladesh Bank, BBS, BMET, EPB etc. and
e. Various published documents like- Bangladesh Bank’s Monthly Economic Trend, Statistical Yearbook of BBS.
B) Data analysis techniques:
This report is an analytical one. Different statistical tools are used in analysis and presentation of data throughout the report. The over all analysis techniques are-
· In the report- Nominal and Real Annual Growth Rate, Acceleration Rate and Compound Growth Rate for Import, Export and Remittance individually and collectively shown and analyzed.
The Real amount is determined by considering Inflation Rate (point-to-point) and Exchange Rate. These data are taken form Bangladesh Bank’s publications.
To find out the relationship among different variables with Import, Export and Remittance Multiple Regression Analysis is conducted.

Microsoft Excel is used in calculating and constructing of graphs
Minitab Statistical software is used to analyze correlation and multiple regression analysis.
Tables, Pie Charts, Bar Charts and Line Graphs are used in presenting data.

1.5 Limitations of the report
Some problems were faced during the preparation of the report. That is why making a quality project paper is a crucial issue. As there were some problems, it creates some limitations in preparation of this paper. In spite of those limitations, a wholehearted effort was given to make the report a success. The limitations were-
With the tremendous expansion of this business all the aspects of it cannot be explored thoroughly.
Different bases of storing data regarding National economic variables create problems in analysis.
Another limitation of this report is Bank’s policy of not disclosing some data and information for obvious reason, which could very much useful.
Since the major source of the data was secret, a lot of important data could not be used in preparing this report.
The employees of the Banks were busy with their scheduled work. As a result I could not manage them to give me enough time.
Lastly, lack of in-depth knowledge, experience and analytical ability for writing such report.