thesis Paper -Part-Two- Forhad

Thesis Paper on

“Comparative Financial Performance Analysis on

Some Private Commercial Banks of Bangladesh.”

Submitted To

Mostofa Mahmud Hasan

Assistant Professor

Department of Business Administration

Stamford University Bangladesh.

Submitted By

Forhad Ahmed

ID: MBA 05916461,


STAMFORD UNIVERSITY BANGLADESH

Date of Submission: January 08, 2017

Page 2

Letter of Transmittal

January 08, 2017


Assistant Professor



Subject: Submission of Thesis Paper.

Dear Sir,

I am glad to submit my Internship Report on “Comparative Financial Performance

Analysis on Some Private Commercial Banks of Bangladesh” for the Thesis Paper

(MBA 59th Batch), is pivotal requirement for the study of finance at SUB herewith. This

paper is a result of my practical work that I have conducted during specified time of

Thesis. All the works presented here is done with utmost sincerity and honesty. I have

considered your remarks and instructions very carefully while preparing this report. I

have tried my level best to follow your schedule, format and discipline. The whole

experiences of this report writing enable me to bridge the gap between the theoretical

knowledge and practical knowledge. I am grateful to you for providing such an

opportunity and also grateful to all the persons who help I make it possible.

I have tried my best to make this report holistic and informative enough. Besides this,

there may be shortcomings. I would be grateful if you consider those from excusable

point. Thank you for your consideration.

Sincerely Yours,

Forhad Ahmed

Id No # 05916461

Department of Business Administration,


Page 3

Student’s Declaration

The work presented in this thesis is original and has not been submitted by me to any

University or Institution for the award of any degree or diploma. The thesis

“Comparative Financial Performance Analysis on Some Private Commercial Banks

of Bangladesh” submitted by me for the award of the Degree of Master of Business

Administration at the Stamford University Bangladesh is an original and benefited work

done by me carried under the supervision of Assistant Professor Mr. Moostafa Mahmud

Hasan, Department of Finance, Stamford University Bangladesh, and that neither of this

thesis nor any part of it has been submitted for the award of any degree, diploma or any

other purposes anywhere.

Forhad Ahmed

ID# MBA 05916461


Stamford University Bangladesh

Page 4

Teacher’s declaration

To Whom It May Concern

This is to certify that the thesis report on “Comparative Financial Performance

Analysis on Some Private Commercial Banks of Bangladesh” For the degree Master

of Business Administration (MBA) major in Finance from Stamford University

Bangladesh carried out by Forhad Ahmed, Student ID # MBA05916461 under my

supervision. As far as I am concern, no part of the Thesis report has been submitted for

any degree diploma, title, or recognition before.


Assistant Professor



Page 5

Acknowledgement

“In the name of Allah.”The Beneficent and the Merciful” Praise is to Allah that gives me

an opportunity to complete this research on “Comparative Financial performance

Analysis on Some Private Commercial Banks of Bangladesh”

First and foremost, I am deeply indebted my supervisor Mostafa Mahmud Hasan,

Assistant Professor & Present Chairman, Department ofFinance, Business

Administration, Stamford University Bangladesh for his stimulation inspiration astute

guidance, valuable suggestion, and sagacious advice’s and whole hearted supervision to

me during the practical orientation period. Without him, simply this piece of work would

have not been possible. One simple cannot wish for any better or friendlier supervisor

than him. I gratefully acknowledge the contribution of so many individuals, researchers,

scholars and Bankers of different private commercial banks who directly or indirectly

came forward to help me in conducting my research work and preparation of the thesis.

I would also like to express my deepest gratitude to university of Dhaka, especially to

department of Management that provides support for the research.

I feel it obligatory to express my indebtedness to my parents & support and mellifluous

affection which helped me to achieve successes and without their kind devotion this

would have been a sheer dream. I would like to say that I have work accurately. However

there might be some mistakes. So I seek kind consideration as I am in the process of

learning. I hope this research work will benefit not only the academic and university but

also to the public at large.

Above all, I think almighty Allah for all mercies.

Page 6

Abstract

I have prepared this internship report based on three month thesis program as it is

required for the MBA program. Though this thesis program I have collected data in

Financial Administration Division (FAD) of five banks. Five Banks are most common

familiar private commercial bank in banking industry. Banks plays a vital role in

forecasting the economic and social condition of a country. Customer’s satisfaction is

one of the most vital reflections of the progression toward advancement and

development for this bank institution. The achievement of the customer’s satisfaction is

the key feedback to improve service quality. The report has organized in five chapters.

First chapter including introductory part of the report, there I mention main objective of

the report. The main objective of the report is to analyze the financial performance of

management and the bank as whole. In preparing this report I use both primary and

secondary data.

Second chapter consist a literature overview of banking sector in Bangladesh, where I

discus about the bank’s mission, vision, and functions and bank’s function ability and

position of banking industry of those banks.

Third chapter consist an overview of organization, where I discuss about some

important information of AB Bank Ltd, UCBL, IFIC Bank Ltd, The City Bank Ltd such

as their mission, vision, objective, Board of Directors, Executives, products & services

and last one year performance in five leading bank.

Fourth Chapter includes theoretical part. There discuss about financial performance

analysis, objectives, Ratio, advantage of ratio analysis, limitation of ratio analysis and

groups of ratio.

Fifth chapter of the analysis ment chapter, where I used some financial parameter for

analyze the financial performance of those banks. These parameters are capital, liquidity

ratio, debt ratio, profitability ratio and last one is market ratio and recommendation and

concludes the chapter.

Page 7

Table of Contents

Particulars Page No.

Cover Page 01

Letter of transmittal 02

Student’s declaration 03

Teacher’s declaration 04

Acknowledgement 05

Abstract 06

Table of Contents 07

Chapter 1.1 Background of the Study 01

1.2 Rationale of the Study 02

1.3 Objectives of the report 02

1.4 Scope of the report 03

1.5 Limitations of the study 03

1.6 Methodology 03

Chapter 2 Literature review 05

2.1 After Independence 05

2.2 Camel’s Rating System 11

2.3 Evaluation of Camel Rating 12

2.3.1 Worldwide Camel’s rating 12

2.3.2 Camel Rating Evaluation in Bangladesh 12

2.4 Comparison Between Camel & Camel’s Rating

System

13

2.5 Predictability of Camels Rating System 14

Chapter 3 Introduction 16

3.1 AB Bank Ltd 16

3.2 The City Bank Ltd 22

3.3 IFIC Bank Ltd 27

Page 8

3.4 National Bank Ltd 28

3.5 UCBL Bank Ltd 39

Chapter 4 Analysis of the Report 46

4.1.1 Introduction 46

4.1.2 Capital Adequacy 46

4.1.3 Capital Adequacy Ratio 46

4.1.4 Equity Capital Total Asset Ratio 47

4.1.5 Asset Quality 48

4.1.6 NPL Total Loans Ratio 49

4.1.7 NPL to Total Equity Ratio 49

4.1.8 Provision Loan Loss ratio 51

4.19 Management Quality 52

4.1.10 Total Expense to Total Income Ratio 52

4.1.11 Operating Expense Total Expense Ratio 53

4.1.12 Earning Per Employee 54

4.1.13 Operating Expense Per Employee 55

4.1.14 Earning Ability 55

4.1.15 Net Interest Margin Ratio 56

4.1.16 Cost Income Margin Ratio 57

4.1.17 Return on Total Assets 58

4.1.18 Return on Equity 58

4.1.19 Liquidity Management 59

4.1.20 Customer Deposit 60

4.1.21 Total Loans to Customer Deposit Ratio 60

4.2 Financial High Lights 61

4.3 Relative Ranking 64

4.4 SWAT Analysis 65

Chapter 5.1 Major Findings 66

Page 9

5.1.1 The City Bank Ltd 66

5.1.2 IFIC Bank Ltd 66

5.1.3 UCBL Bank Ltd 67

5.1.4 AB Bank Ltd 67

5.1.5 National Bank Ltd 68

5.2 Recommendation 68

5.2.1 The City Bank Ltd 68

5.22 UCBL Bank Ltd 69

5.2.3 IFIC Bank Ltd 68

5.2.4 National Bank Ltd 70

5.2.5 AB Bank Ltd 70

5.3 Summary of Recommendation 71

5.4 Conclusion 72

Bibliography 74

List of Abbreviation 75

Appendix 77

Page 10

List of Tables


A Capital Adequacy Ratio 46

B Equity Capital Total Asset Ratio 47

C (1) NPL Total Loans Ratio 49

C (2) NPL to Total Equity Ratio 50

C (3) Provision Loan Loss ratio 51

D (1) Total expense to Income Ratio 52

D (2) Operating Expense to Total Expense Ratio 53

D (3) Earning Per Employee 54

D (4) Operating Expense Per Employee 55

E (1) Net Interest Margin Ratio 56

E (2) Cost Income Margin Ratio 57

E (3) Return on Total Asset 58

E (4) Return on Equity 59

F (1) Customer Deposit 60

F(2) Total Loan to Customer Deposit Ratio 61

Page 11

List of Figures


A Capital Adequacy Ratio 47

B Equity Capital Total Asset Ratio 48

C (1) NPL Total Loans Ratio 49

C (2) NPL to Total Equity Ratio 50

C(3) Provision Loan Loss ratio 51

D (1) Total expense to Income Ratio 52

D (2) Operating Expense to Total Expense Ratio 53

D (3) Earning Per Employee 54

D (4) Operating Expense Per Employee 55

E (1) Net Interest Margin Ratio 56

E (2) Cost Income Margin Ratio 57

E (3) Return on Total Asset 58

E (4) Return on Equity 59

F (1) Customer Deposit 60

F(2) Total Loan to Customer Deposit Ratio 61

Documents

thesis Paper -Part-Two- Forhad