Credit Risk Management of National Bank Limited

Limited in this report.

1. 2 Objectives: Broad Objective: To analyze the Credit Risk Management policy. Specific Objective: To attain the broad objective the following specific objectives will be pursued- * To identify the various types of credit disbursed by NBL. * To analyze the credit portfolio of NBL. * To get idea about the process of credit management practices of NBL. * To examine the credit disbursement trend of NBL.

* To analyze the credit recovery performance of NBL. * To analyze compliance with the Bangladesh banks guidelines. Loan disbursement amount and Recovery Position of NBL, Kawran Bazar Branch during the ear 2007 to 2009. 1. 3 Scope of the Report: This report has two broad divisions. One is the organization part and the other is the project part.

The organization part describes my host organization NBL. The project part deals with the specific assignment that I carried out on my host organization. This specific assignment or the project is to find out the effectiveness of credit risk management policy of NBL. 1.

4 Methodology: Sources of information: Both primary and secondary sources of information were used to complete this report.Primary Sources: Primary data and information were collected by interviewing relevant persons at NBL. The interviewed personnel were: Md. Jakir Hossain, Senior Officer, Credit Section, Kawran Bazar Branch. Mr. Md.

Sohel Faisal, Vice President& Manager, Kawran Bazar Branch. Secondary Sources: Majority of the data were collected form secondary sources. These sources are * The audited financial statements of NBL for the year of 2007, 2008 and 2009 * Circulars from Bangladesh bank and NBL 's head office * NBL 's manual on credit * NBL's training materials 1. 5 Limitation: To prepare the internship report I have encountered some limitations.The limitations are as follows:- * Some information is very confidential which were not vailable in the branch office.

* Some Bank officers were reluctant to divulge information about their own respective functions. * There were some confidential files where I did not get access. * Time constraint Chapter 02 The Organization 2. 1 An Overview of National Bank Limited: National Bank is the first private sector bank fully owned by Bangladeshi entrepreneurs. It was established in 1983 by a group of businessmen.

At present it is the largest private bank with 121 branches and 10 SME centers spread all over the country.The emergence of National Bank Ltd. in the private sector is an important event in the Banking arena of Bangladesh. When the nation was in the grip of severe recession, Government took the decision to allow in the private sector to revive the economy of the country.

Several dynamic entrepreneurs came forward for establishing a bank with a motto to revitalize the economy of the country. The then President of the People's Republic of Bangladesh Justice Ahsanuddin Chowdhury inaugurated the bank formally on March 28, 1983 but the first branch at 48, Dilkusha Commercial Area, Dhaka started functioning on March 23, 1983.The 2nd Branch was opened on 1 lth May 1983 at KhatungonJ, Chittagong. Today NBL has a total of 121 branches all over Bangladesh. The main objective of establishing this bank was to make due contribution to the socio-economic development of the country through productive and profitable investment of the hard earned savings of the depositors and a commitment of improved services to the clients.

With this end in view, NBL has continued its efforts to provide prompt and improved services together with proper counseling in financial to all clients.NBL's objective has been identifying the proper sector and extending best investment consultancy. Keeping the idea of middle and lower middle class in mind the bank has introduced consumer credit schemes, roviding small credit to such borrowers who repay in easy installments. The bank is earning significantly by managing liquid assets. NBL mainly caters to the trade finance market.

Its principal areas of financing are trade ; business, export-import, setting up mills ; factories, garment, knitwear, supply of working capital, shrimp culture, real estate, rural development program, etc.Credit facilities are also allowed to contracting firms to support proper execution of work/supply, orders relating to overall development including infrastructure of the country received by them from he government and different important organization. NBL earned international reputation for its success in different banking activities especially in foreign transaction. Since the very beginning, the Bank exerted much emphasis on overseas operation and handled a sizeable quantum of homebound foreign remittance.

The Bank established extensive drawing arrangement network with Banks and Exchange earners residing in.Since inception, the bank has helped in creating new entrepreneurship in the ready-made garments sector by encouraging the true entrepreneurs and extending finances, which not only helped create new businesses ut also contributed in saving valuable foreign currency for the country. People living in abroad can now easily remit their hard-earned money to the country with confidence, safety and speed. NBL has been able to create a special image at home and abroad by introducing different banking products in accordance with the expectations and requirements of people of the country.NBL was the pioneer banks to allow back-to back L/C facility without any margin to the entrepreneurs of garment industry during the eighties, thereby helping the industry thrive to its present position. This has not only contributed to enrichment of the countrys foreign xchange reserves, but also opened employment opportunities for a large number of labor force of the country.

NBL is the first bank to introduce international Master Card in Bangladesh, which has facilitated the users to get benefit of different facilities both home and abroad.