An Analysis of Credit Schemes of National Bank Limited A Study on Babu Bazar Branch www.assignmentpoint.com

Objectives Of the Study To analyze the credit schemes of the National Bank Limited, Babu Bazar Branch To describe different credit schemes of the bank To analyze various credit policies of National Bank Limited of Babu Bazar branch To prescribe some suggestions based on findings of credit schemes www.assignmentpoint.com

Credit Services: 1. CURRENT OR CONTIOUS LOAN 1.1 Cash Credit- I) CC-pledge II) CC-Hypothecation 1.2 SOD- I) SOD against Work order II) SOD (Bid Bond) 1.3 Demand Loan- I)LEVJ (loan against trust receipt) II) Payment against Document (PAD) III) Loan against Trust Receipt (LTR) IV) Inland Documentary Bill Payment (IDBP) V) Foreign Documentary Bill Payment (FDBP) VI) Packing Credit (PC) www.assignmentpoint.com

Credit Services: 1.4 Term Loan- I) House Building Loan II) Employees house building loan III) Consumer Credit Scheme 2. Working Capital Loan 3. Contractor Loan www.assignmentpoint.com

Credit Ratings policy Rationalization of prudential norms for loan classification and provisioning Policy for rescheduling of loans Designing and enforcing an "integrated credit risk grading manual Credit rating of the banks Revisions to the make-up of Tier-2 capital Besides Since 1998 CAMEL rating of banks gradually improved and in 2006 Bangladesh Bank updated this rating model by incorporating the market risk and the new model is known as CAMELS. www.assignmentpoint.com

Findings: The realization of classified loan is increasing, because of good administration…… National Bank Ltd is trying to improve their credit product to satisfy the consumer…… National Bank tries to follow all rules and regulation given by Bangladesh Bank when they sanction any loan. National Bank Ltd is trying to increase of credit in small and medium entrepreneurs. According to the ratio analysis, the amount of loans and advances are increasing year by year which is good sign for the bank. During the year of 2006 the Loans and Advances of NBL was Tk 32,709.68 millions and in the year 2010 the loans and advances of NBL increases up to Tk 92,003.56 millions. The increasing percentage of advance deposit ratio is also positive. It increases 81.06%-89.78% in the year 2006-2010. www.assignmentpoint.com

Recommendations: NBL should give more freedom to their branches like Bau Bazar branch for taking decisions and their head office should take decision more quickly. NBL should build separate loan recovery division if it happened then their classified loan amount will reduce and they can invest more. Modern technology should be used to maintain documentation. Like computer, software for any calculation. If they store their documents in a computer, they can easily search it & it takes only few seconds. All branches should properly maintain all documents on daily basis Interest rate should be increased. In order to provide faster service, full-time online system should be implemented. www.assignmentpoint.com

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