LOAN PERFORMANCE OF BASIC BANK LIMITED, BANGLADESH

Internship Report on BASIC Bank Limited i
WORKING REPORT ON THE FUNCTION OF CREDIT DIVISION AND
LOAN PERFORMANCE OF BASIC BANK LIMITED
By:
ZOEB HASAN
ID: 1420656
An Internship Report Present in Partial Fulfillment of the Requirement for the Degree
Bachelor of Business Administration
Independent University, Bangladesh (IUB)

Internship Report on BASIC Bank Limited ii
WORKING REPORT ON THE FUNCTION OF CREDIT DIVISION AND
LOAN PERFORMANCE OF BASIC BANK LIMITED
By:
Zoeb Hasan
ID: 1420656
Has Been Approved
November, 2017
MD Aynul Hoque
Lecturer in Management
School of Business
Independent University, Bangladesh

Internship Report on BASIC Bank Limited iii
Letter of Transmittal
November 30, 2017
MD Aynul Hoque
Lecturer in Management
School of Business
Independent University, Bangladesh
Subject: Submission of internship Report on “The Function of Credit Division and Loan
Performance of BASIC Bank Limited”.
Dear Sir,
With due respect, I would like to submit my internship report on “The Function of Credit Division and
Loan Performance of BASIC Bank Limited”. I have completed my internship report as part of the
course requirement of BBA program under your supervision. I tried my best to make this report as much
informative as possible.
I, therefore, pray and hope that you would kind enough accept my report and oblige thereby.
Sincerely yours,
Zoeb Hasan
ID# 1420656

Internship Report on BASIC Bank Limited iv
Acknowledgement
First of all, I would like to express my deep gratitude to the almighty Allah for giving me the ability to
complete the report within the due time.
I would like to express heartiest gratitude to my supervisor of Internship Program MD. Aynul Hoque
for his important suggestion, excellent guideline and supervisions for preparing this internship report.
Then I would like to thanks Mr. Saidur Rahman Sohel, AGM, Bashundhara R/A branch, BASIC Bank
Limited for give me the opportunity to complete my internship in his branch. I am also grateful to Mr.
Md. Sultan Mahmud, Officer for his constant help and support during my working period at BASIC
Bank Limited. I would like to thank all officer of BASIC Bank Limited, Bashundhara R/A Branch for
their support and love.
Finally, I would like to thank to those people who are related with making of this report and make
it a success.

Internship Report on BASIC Bank Limited v
Table of Contents
Letter of Transmittal.......................................................................................................................................... iii
Acknowledgement............................................................................................................................................... iv
List of Tables.......................................................................................................................................................vii
List of Figures .....................................................................................................................................................vii
List of Charts ......................................................................................................................................................vii
Executive Summary...........................................................................................................................................viii
Chapter 1: Introduction....................................................................................................................................... 1
1.1 Company Profile.......................................................................................................................................... 2
1.1.1 Vision, Mission and Objective: ............................................................................................................ 3
1.1.2 Organogram of BASIC Bank Limited:................................................................................................. 4
1.1.3 Corporate Division / Department: ........................................................................................................ 5
1.1.4 Details of the Product Lines: ................................................................................................................ 6
1.1.5 Operation Details:................................................................................................................................. 8
1.1.6 Corporate Social Responsibility (CSR).............................................................................................. 10
Chapter 2: Internship Experience / Observation Details................................................................................. 12
2.1 Job Responsibilities:.................................................................................................................................. 13
2.1.1 General Banking Department............................................................................................................. 13
2.1.2 Credit Department: ............................................................................................................................. 14
2.2 Functions of Department:.......................................................................................................................... 14
2.2.1 General Banking:................................................................................................................................ 14
2.2.2 Credit Department: ............................................................................................................................. 16
2.2.3 Function of Credit Division:............................................................................................................... 17
Chapter 3: Industry Analysis, Problem Identification & Analysis of Lone Performance.............................. 18
3.1 Analysis of Industry and Market:.............................................................................................................. 19
3.1.1 The Banking Industry of Bangladesh:.................................................................................................... 19
3.1.2 Market Segment...................................................................................................................................... 20
3.1.3 Regulation of the Banking Industry in Bangladesh:............................................................................... 21
3.1.4 Current Status of the Banking industry: ................................................................................................. 22
3.2 Main Competitors [Based on their Market Capitalization or Asset Size].............................................. 23
3.3 Problem Identification, Identify a Specific Issue and Analysis:.............................................................. 25
3.3.1 Loan Performance .................................................................................................................................. 25
3.3.2 Problem Identification:........................................................................................................................... 26

Internship Report on BASIC Bank Limited vi
3.3.3 Process Credit Approval of BASIC Bank Limited................................................................................. 26
3.3.3.1 Approval Authorities of the individual and Corporate Loans ......................................................... 26
3.3.3.2 Lending Criteria for General loan ................................................................................................... 27
3.3.3.3 Lending Criteria for SME and Corporate loan ................................................................................ 27
3.3.4 Credit collection of BASIC Bank Limited ............................................................................................. 27
3.3.4.1 Collection Processes:....................................................................................................................... 27
3.3.4.2 Collection Steps:.............................................................................................................................. 27
3.3.5 Classification & Credit Loss Recognition Policy................................................................................... 28
3.3.5.1 Non-performing Loan:..................................................................................................................... 28
3.3.6 Provisioning Procedures of BASIC Bank Limited:................................................................................ 29
3.3.6.1 General Provisions: ......................................................................................................................... 29
3.3.7 Loan Rescheduling................................................................................................................................. 30
3.3.7.1 Rescheduling of Term Loans:.......................................................................................................... 30
3.3.7.2 Rescheduling of Demand and Continuous Loan: ............................................................................ 31
3.3.8 Ratio Analysis ........................................................................................................................................ 31
Chapter 4: Conclusion & Recommendation..................................................................................................... 35
4.1 Conclusion................................................................................................................................................ 36
4.2 Recommendation..................................................................................................................................... 37
Reference............................................................................................................................................................ 38
Appendix A ........................................................................................................................................................ 39

Internship Report on BASIC Bank Limited vii
List of Tables
Table No. Table Title Page No.
1.1 Product & Service of BASIC Bank Limited 7
3.1 Asset Size of Private Commercial Bank 23
3.2 Collection Steps 28
3.3 Classification of Non-Performing loan 29
3.4 Rate of General Provision 30
3.5 Rescheduling Demand & Continuous Loan 31
3.6 Ratio Analysis 31
List of Figures
Figure No. Figure Title Page No.
1.1 Organogram of BASIC Bank Limited 4
2.1 Function of Credit division 17
3.1 Banking Sector of Bangladesh 20
List of Charts
Chart No. Chart Title Page No.
3.1 Capital Adequacy Ratio 32
3.2 Non-Performing Loan Ratio 33
3.3 Return on Asset Ratio 34

Internship Report on BASIC Bank Limited viii
Executive Summary
Financial institutions of a country play an important role in building the financial backbone of the
country’s economy. BASIC (Bangladesh Small Industries and Commerce) Bank Limited is one of the
Stated-Owned Commercial bank in Bangladesh. The main purpose of established this bank is invest
in small and medium industries in Bangladesh.
Credit Division is one of the important divisions of BASIC Bank Limited. The main objective of credit
division is to give loan, monitoring the risk of the loans and recover the loan. Credit risk is one of the
most vital risks for any bank. It might cut the profit level. Credit division is responsible to monitoring
this kind of risk and take proper action.
My internship report is divided into four parts. In first part, is overview of the BASIC Bank Limited
Second part, is about job responsibility and function of the department. During my internship I worked
General Banking and credit division. Third part, is analysis part. In his report I analysis the function of
credit division and loan performance of BASIC Bank. In report I also analysis 5 years ratio. Four and
final part is recommendation and conclusion.
After the analysis I found BASIC Bank has high level of non-performing loans. These non-performing
loans cut off their profit. They should follow the credit risk management properly to minimize the risk.

Internship Report on BASIC Bank Limited
1
Chapter 1: Introduction

2
1.1 Company Profile
BASIC Bank Limited One of the stated owned commercial bank in Bangladesh. The main purpose of
Established this bank to invested in small industries in Bangladesh. But nowadays BASIC Bank expands
their activities and invests not only small industry also medium and large manufacturing industries.
BASIC Bank Limited (Bangladesh Small Industries and Commerce Bank Limited) registered under the
Companies Act 1913 on the 2nd of August, 1988, started its operations from the 21st of January, 1989. It
is governed by the Banking Companies Act 1991. The Bank was established as the policy makers of the
country felt the urgency for a bank in the private sector for financing small scale Industries (SSIs). At the
outset, the Bank started as a joint venture enterprise of the BCC Foundation with 70 percent shares and
the Government of Bangladesh (GOB) with the remaining 30 percent shares. The BCC Foundation being
nonfunctional following the closure of the BCCI, the Government of Bangladesh took over 100 percent
ownership of the bank on 4th June 1992. Thus the Bank is state-owned. However, the Bank is not
nationalized; it operates like a private bank as before (Limited, About Bank, 2010).
BASIC Bank Limited is unique in its objectives. It is a blend of development and commercial banks. The
Memorandum and Articles of Association of the Bank stipulate that 50 percent of loanable funds shall be
invested in small and cottage industries sector. Steady growth in client base and their high retention rate
since Bank’s inceptions testify to the immense confidence they repose on its services. Diversified products
both liability and assets sides particularly a wide range of lending products related to development of small
industries and micro enterprises, and commercial and training activities attract entrepreneurs from varied
economic fields. Along with promotion of products special importance is given to individual clients
through providing personalized services. In fact individuals matter in this Bank. This motto has been
followed for development of clientele as well as human resources of the Bank.

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1.1.1 Vision, Mission and Objective:
Vision:
To be a bank of choice by intertwining excellence in customer service experience, optimum profitability
with efficiency, imitable corporate culture in terms of compliant banking activities, efficient and
motivated human resources and endless quest for becoming the best corporate citizen through serving
people for progress.
Mission:
Establishing the bank as a strong bank in the market and society with good fundamentals by:
i. Offering best value-based greener products and services
ii. Embracing appropriate knowledge and technology
iii. Creating an environment for professional, efficient and motivated pool of human
resources
iv. Establishing good corporate governance and compliance culture
v. Maintaining good relations with stakeholders
vi. Fostering financial inclusion and opening up a compassionate and human side of banking
Goals and Objective:
i. To invest 50 percent of loanable funds in financing and medium industries sectors
ii. To serve the depositors in safekeeping and growing their savings
iii. To act as agents for the sale and purchase of any stock, shares or securities or for any
other monetary or mercantile transactions
iv. To promote the development of small and medium industries and to provide finance to
all kind of banking facilities and to provide technical services to small and medium
industries in Bangladesh

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1.1.2 Organogram of BASIC Bank Limited:
Figure 1.1: Organogram of BASIC Bank Limited

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1.1.3 Corporate Division / Department:
There are many division in basic bank but basically these three department is very important.
1. General Banking Department.
2. Credit Department.
3. Foreign Exchange Department.
General Banking Department:
General Banking Department plays a very significant role to portray a good image on the Customer’s
mind as it is considered as the direct customer service Centre. The banking operation Begins with this
department. This department delivers day to day services to the customers. The Clients and Customers
build their impression here and the client decides whether they should go for further dealings or not; on
the basis of the services delivered by the officials. It comprises of some basic activities on which other
sectors continue their operation.
Credit Department:
Modern banking operations touch almost every sphere of economic activity. The extension of Bank credit
is necessary for expansion of business operations. Bank credit is a catalyst for bringing about economic
development. Without adequate finance, there can be no growth or maintenance of a stable output. Bank
lending is important to the economy, for it makes possible the financing of agricultural, commercial and
industrial activities of a nation.

6
Foreign Exchange Department:
Banks play a very important role in effecting foreign exchange transaction of a country. Mainly
Transactions with overseas countries are in respect of imports; exports and foreign remittance cone under
the purview of foreign exchange department. Banks are the vital sectors by which such Transactions are
settled. Central Bank records all sorts of foreign exchange transactions. The other banks dealing with
foreign exchange are to report to Bangladesh Bank regularly (e.g. daily, monthly, quarterly, yearly etc.).
There also Card Division, Commercial Credit Division, Compliance Division, Consumer Finance
Division, Credit Administration Division, Small Enterprise Division, MIS Division Recovery Division
Research & Development Division Risk Management Division.
1.1.4 Details of the Product Lines:
Basic Bank Limited offers various kinds of deposit products and loan schemes. The bank also has highly
qualified professional staff members who have the capability to manage and meet all the Requirements of
the bank. Every account is assigned to an account manager who personally takes Care of it and is available
for discussion and inquiries, whether one writes, telephones or calls.

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Table1.1: Product & Service of BASIC Bank Ltd.
Deposit Schemes 1. Premium plus Current Deposit (CD) AC
2. Special Notice Deposit (SND) AC
3. Savings Bank (SB) Deposit AC
4. Special Savings AC
5. Fixed Deposit Receipt (FDR) Term Deposit
Receipt (TDR)
Loan Product 1. Agriculture Loan
2. Agro Based Industries
3. Micro and Cottage Industry/ Enterprise Loan
4. Home Loan
5. SME Loan
6. Large Industry (manufacturing and Service) Loan
7. Commercial Lending
8. Trade Financing
9. Loan to Real Estate
10. Overdraft against FDR
11. Short term loan
12. Transport Loan (Industry/Commercial
Others scheme 1. Fixed Deposit Scheme
2. Monthly Benefit Deposit Scheme
3. Education Savings Scheme
4. Savings Deposit Account
5. School banking.
6. Basic fortune.
7. Basic fortune plus.

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1.1.5 Operation Details:
A bank mainly operates their activity through take deposit from customers and gives loan to others
from the deposit surplus. The major source of bank fund is deposit money from customers. Bank use
these fund and give loan to others. This is the major profit site of a bank.
General Banking:
General banking is the primary operation of a bank. Bank collect their deposit fund from customer
through general banking. It is one of the biggest sources of fund for a bank. To collect the fund bank
have different kind of accounts.
Loan and Advance:
Bank use the deposit fund and give loan to the clients. It is one of the major source of income for
bank. BASIC Bank target small, medium and large enterprise to give loan.

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Trade Finance:
BASIC Bank help to finance export and import Business. BASIC Bank help exporter and importer
to trade easily. BASIC Bank also help to give loan.
The branch manager is the head of our Branch. He maintains the branch by assigning the Employees with
different task and job responsibility. Under the Manager there is an operation Manager / 2nd
officer. He is
the one who actually gives the task to the employees as he was told to do so by Branch manager. He also
works as the general manager in the absence of branch manager. Under the supervision of operation
manager there are also other seniors Officers and junior Officers who works at the bank under the
accounts, cash, investment, Foreign exchange and General Banking Department.
Here is the Bashundhara R/A Branch Structure of BASIC Bank Ltd:

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1.1.6 Corporate Social Responsibility (CSR)
Poverty Alleviation It is globally accepted that the Non-Government Organizations (NGOs) have been
performing a laudable role in poverty alleviation across the globe, especially in Bangladesh. BASIC
Bank Limited has been financing NGOs for quite since 1995 at privileged rates of interest (between
7.00% and 13.00%). So far we have financed 65 NGOs of various categories and capacities from small
to large and also from local/regional to national/international. Such activities also contributed to
generation of income and employment as well.
Women Empowerment As half of our population is woman, a sustainable national progress can’t be attained,
if women are left aside. Therefore, they should progressively be brought to the mainstream of our
development activities. Considering this reality the bank has been mobilizing credit facilities to the capable
women entrepreneurs at a reduced rate of interest. So far we have financed several woman entrepreneurs and
it will gain due momentum in the days to come.
Our Concern for the Environment Today our planet is exposed to a severe environmental
catastrophe than ever before. As a humble effort to reduce environmental pollution, we have financed
26 CNG refueling stations. Again, most of our office vehicles have already been converted to CNG
fueling system. Use of CNG fuel also helps save hard earned foreign currency. Environmental issues
are taken into account while assessing credit proposal for the industrial projects.
Sports Activities During the year 2011, the Bank extended financial support Tk.1.00 core each to Sheikh
Russel Krira Chakra and Sheikh Jamal Dhanmondi Club towards development of games and sports. The
Bank also contributed Tk.10.00 lac to Bangladesh Table Tennis Federation in the year 2011. The Bank
also sponsored 25th to 31st National Junior Chess Championship by contributing Tk.1.00 lac in each
year. It was a privilege and honor for the Bank to work with the 11th SA Games held since January 29,
2010 to February 09, 2010 in Dhaka as a co-sponsor by contributing Tk.1.00 core to Bangladesh Olympic
Association. BASIC has been patronizing the Handball Federation by arranging BASIC Bank Limited
Inter-district National Women Handball Tournament. The Bank also sponsored the National &
International BASHAAP Championship in 2008.

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Disaster Relief In the year 2011, the Bank donated 25,000 pieces of blankets to Prime Minister’s
Relief and Welfare Fund. In the previous year the Bank donated an amount Tk.1.00 core to the same Fund for
the rehabilitation of the victims of the Nimtoli Fire Tragedy. In the year 2007, the Bank donated Tk.25.00
lac to the Chief Adviser’s Relief Fund for the flood affected people and Tk.25.00 lac for the SIDR victims.
Education During 2011, the Bank distributed Tk.5.00 lac among the meritorious students of Gopalganj
Zilla Samity. In 2013, BASIC Bank Limited donated a fund of Tk.50.00 lac to the aggrieved families of
the two late secretaries of the Government of Bangladesh for maintaining the educational expenditure of
their children. In 2009 BASIC Bank Limited donated Tk.2.00 lac to Bangladesh Asiatic Society for
publishing Bengali version of the largest National encyclopedia of Bangladesh. With a view to provide
a smooth interface between student life and professional life, we offer internship facility to the BBA and
MBA students of different universities with commendable academic records after completion of all other
academic requirements. In Every year, a huge numbers of interns were granted the opportunities to groom
with us in a truly professional, dynamic and challenging corporate environment.
Promotion of Entrepreneurship The promoters of the Bank envisaged fostering entrepreneurship amongst
the potential, new and small entrepreneurs and generating employment through financing Small and Medium
Scale Industries (SMIs) towards industrialization actually needed for economic growth of the country. Keeping
the dream in mind, we never ran after the so-called blue chips towards profit maximize of the Bank. Rather,
we always remained stick to the triple bottom line: People, Planet & Profit and focused attention to the SMIs
which is ultimately promotion of SMEs. In this way, a lot of entrepreneurs have grown with us through which
employment opportunities are created for a large number of people.

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Chapter 2: Internship Experience / Observation Details

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2.1 Job Responsibilities:
I did my three month internship program in BASIC Bank Limited, Bashundhara R/A branch. During
my intern I learned lots of about bank environment and activities. I think it will help me in feature
corporate life. My internship responsibilities are given below:
The report has been prepared on the basis of my responsibilities during my internship period. Within
this time period I mainly worked with two departments which are General Banking and Credit Division.
BASIC Bank does not follow any fixed responsibilities for internship student. Most of the time I worked
Account opening section under General Banking. Later I assigned credit division.
2.1.1 General Banking Department
I Started my Internship at BASIC Bank Limited Bashundhara R/A with Account Opening Section under
General Banking. In this section I learned the procedure of opening an account and the documents that are
needed for opening an account. I also know the types of account and deposit product that provided by
BASIC Bank Limited. When I learned all these things later I deal with clients questions regarding different
accounts opening with interest rate information that they will get from different categories of account.
The following responsibilities done by me:
Account Opening Section:
 Provide the information about the Deposit Product.
 Provided the information to the customers about the documents which will be required to open an
Account
 Fill up the uncompleted forms. There were some forms which were filled up without putting account
number, account title name and serial number, NID number and photo
 Distribution of desired cheque book according to customer name and their account number. Then
take their signature in the registry book
 Distribution of desired ATM card according to customer account number

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Account Section:
 Debit and Credit voucher separation
 Voucher Sorting according to serial number or date
 Collect all the Day statement Photocopies and file it up
2.1.2 Credit Department:
This is the most important department of BASIC Bank Limited. In credit risk department there had many
confidential file and customer sensitive information so intern are not allowed to access or see those file.
In credit department all the worked based on computer and intern are not allow to access the computer.
But others manual worked done by the intern.
The Following responsibilities done by me:
 Help to create customer profile
 Fill up customer profile with NID Number/ TIN Number/ Passport Number
 Organized all the customer file and keep them separately
 Photocopy all the documents related to the customer loan
2.2 Functions of Department:
2.2.1 General Banking:
General banking is the most important and common part of any bank. General Banking Department
performs the majority functions of a bank. It is the core department of BASIC Bank Limited like other
Bank. The activities of the General Banking Department of BASIC Bank Limited mainly divided into 5
following categories:
 Account Opening Section
 Remittance Section
 Clearing Section
 Cash Section
 Account Section

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2.2.1.1 Account Opening Section
Customer and bank relationship start with opening an account. Account opening section is the gateway
of entering a customer into bank network. It is the most important section of general banking department.
The basic function of a bank is accepting deposit from customers. Banks accept the customer deposit
through the account.
2.2.1.2 Remittance Section:
It is very difficult and risky to carry cash and transfer one to another part of country. Bank transfer the
cash on behalf of customer and save time and remit the risk through the bank network. This is the main
function of remittance section. In customer demand bank can transfer any amount to any part of country.
Local remittance is one of the main components of general banking. There are 3 mode of remittance-
 Pay order (P.O)
 Demand Draft (D.D)
 Telegraphic Transfer (T.T)
2.2.1.3 Clearing Section:
The work of this section is collection of cheques on behalf of its customers. It also helps payment to
other bank on behalf of customers. If any customer of BASIC Bank submits any cheques of any other
bank to payment then its duty of clearing section to collect the cheque through Bangladesh bank clearing
house and payment the amount . Types of Clearing:
 Inward Clearing
 Outward Clearing
2.2.1.4 Cash Section:
Cash section is very busy and sensitive part of bank. The function of the section is payment and received
cash. Operation of this section begins at the banking hour generally its starts at 10 A.M and closed at 4
P.M. Cash section work starts taking opening money from the vault. After taking the money cash section

16
in-charge entry the amount into the registered. End the banking hour remaining money in the cash counter
is put back in the vault. After that cash officer put the closing amount into the registered. Later cash
officer prepared a cash statement to the branch manager which include amount of money payment and
received.
There is a limitation of withdraw cash from the cash section. The cash officer is allowed to encash
cheque to the clients up to Tk. 100000 with his owned signature. If additional cash is required then it is
needed permission from the cash in-charge officer.
2.2.1.5 Account Section:
The main function of account section is maintain all the transaction record and prepared all the transaction
statements. In bank there are many transaction done every day and these transaction need to be recorded
properly and systematically. For BASIC bank accounts section do this work. End the transaction hour all
the section send the transaction vouchers to accounts sections. The duty officer prepared a statement in
computer a send to branch Manager. It is very important to ensure the entire transaction amount recorded
properly. Because if any amount of transaction recorded mistakenly it will harmful for depositor balance
as well as bank reputation. The following are the activities of Account Section-
 To record all the transaction in cash book
 To prepared daily, weekly, monthly, half-yearly, yearly statement
 To make charges for all deferent types of duty
 To prepared all kind of statement to send Head office and Bangladesh Bank
2.2.2 Credit Department:
One of the primary functions of commercial bank is sanctioning of credit to the potential borrowers. This
is one of the biggest income sources of the bank. For bank Credit department do this work, chose the right
person and give loan. After maturity recovery the loan is also responsibility of credit department. In
BASIC Bank Limited there is a credit division to do all the credit related work. Credit related work is very
sensitive and long process. So do this all work effectively and in a shorter time BASIC Bank divided the
work in 5 sections or unit.

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1. Credit Approval Unit
2. Asset Operation Unit
3. Monitoring Unit
4. Recovery Unit
In Credit Division, all types of credit approved by the credit approval unit. Without clearance form
approval unit loan are not going to disbursement. Asset operation unit ensure all the legal formalities
and prepared all the documents. One of the main responsibilities of asset operation unit is valuation of
collateral asset. Credit division gives loan to the customer 80% of the asset value Loan performance
monitors by the monitoring unit. If any loan perform very bad then monitoring unit send it to recovery
unit. Recovery unit is responsible for collection of loan form the customer. If any customer failed to
fulfill the requirement of the loan agreement then recovery unit call the loan for collection.
2.2.3 Function of Credit Division:
Figure 2.1: Function of Credit Division
Receving
Application of loan
Collection of
information (CIB)
Valuation of
Morgatage Asset
Credit
Approval
Disbursement
Monitoring and
Control
Call up of loan

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Chapter 3: Industry Analysis, Problem Identification & Analysis of Lone
Performance

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3.1 Analysis of Industry and Market:
3.1.1 The Banking Industry of Bangladesh:
The gradual improvement in the overall policy environment has enabled Bangladesh to improve its
economic performance in recent years. Successive governments in Bangladesh have been confronted with
the problem of stimulating the economic growth rate in a country where a substantial segment of the
population lives below the subsistence level. Economic policies are still guided by five year plans.
Nevertheless, some progress has been made over the years, such as self -sufficiency in food grain
production, reducing the population growth rate, poverty alleviation and boosting export income. The
GDP growth per annum has been about 5 percent on an average from 1994-2000; Per capita GDP was
$363 in 1999-2000.
The prospect of economic growth in Bangladesh in the near future will depend on the pace of economic
reforms and the quality of macroeconomic management. Accelerating the rate of economic growth will
require higher levels of investment. This will primarily come from private flows of foreign direct
investment. This can be established by reforming the financial system and continuing the process of
financial deepening.
The financial system in Bangladesh is relatively small and less developed than in most countries in South
and East Asia. The sector’s contribution to GDP has remained static at 1.5 percent during 1999-2000
periods. Commercial banks are at the heart of this financial sector by contributing 80% of the total. The
depth of the financial system, as measured by the ratio of the broad money supply to GDP, has been
growing slowly and was low at around 32% in 1999-2000.
However, as the government is often the owner and regulator as well as the supervisor and customer of a
bank, there has been ample opportunity for mismanagement over the years. The banking sector is plagued
with a lack of credit discipline, archaic loan recovery law, corruption, inefficiency, overstaffing, etc.
Several reform measures of the financial sector have been taken to improve the situation. Relative stability
achieved by the support extended by both the central bank and the Government of Bangladesh in the past
has restored public confidence in the country’s banking sector. Moreover, Nationalized Commercial
Banks (NCBs) and old generation Private Commercial Banks (PCBs) would have to lower the rate of

20
NPAs in their portfolios. Failure to do so would mean re-capitalization, at least for the NCBs. This may
in turn lead to a further drain on the limited resources of the Government of Bangladesh. At this time or
in the immediate future this re-capitalization would not be feasible. With these conditions in place, the
World Bank anticipates the likelihood of a situation where the ever-increasing burden of non-performing
loans and growing rate of debt servicing would place the economy under enormous strain and result in a
crisis in the banking sector in the long term.
3.1.2 Market Segment
The banking industry of Bangladesh is mainly divided into two sectors, such as Specialized Banks (SBs)
and Commercial Banks (CBs). The Specialized Banks are those banks that deal with specific sectors or
industry of an economy. For instance, Bangladesh Krishi Bank (BKB) only deals with the agricultural
sector of the economy; Bangladesh Shilpa Bank (BSB) only deals with the industrial sector of the
economy, etc.
On the other hand, Commercial Banks are Scheduled Banks that are operating in the country under the
rules and regulations of the Central Bank. Commercial banks in turn can be grouped as Nationalized
Commercial Banks (NCBs); Foreign Commercial Banks (FCBs) and Private Commercial Banks (PCBs)
with three different segments, such as 1st
Generation Private Commercial Banks, 2nd
Generation Private
Commercial Banks, and 3rd
Generation Private Commercial Banks.
Figure 3.1: Banking Sector of Bangladesh
Central Bank (Bangladesh Bank)
Scheduled
Banks
State Owned
Commercial Banks
Private
Commercial Banks
Conventional
Commercial Banks
Islamic Shariah
Based Commercial
Banks
Foreign
Commercial Banks
Non-Scheduled
Banks
Specialized
Financial
Institutions

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The Bangladesh Bank (BB) Order created in 1972, authorized Bangladesh Bank (BB) as the central bank
of the country. Bangladesh Bank Order 1972 and the Banking / Companies Act 1991 mainly guide the
commercial banks in Bangladesh. Commercial Banks in Bangladesh are not allowed to do business other
than just banking. Normal activities include borrowing, raising or taking up of money, lending or
advancing of money with or without security. They are also authorized to issue letters of credit, trade in
precious commodities and buying and selling of foreign goods excluding foreign bank notes. They are
also authorized to trade in bills of exchange, promissory notes, coupons, drafts, debentures, certificates
and other instruments approved by Bangladesh Bank (BB). Banking companies are required to provide
safe vaults and are authorized to collect money and securities.
After liberation, the banks operating in Bangladesh (except those incorporated abroad) were nationalized.
These banks were merged and grouped into six commercial banks. Of the total six commercial banks,
Pubali Bank Ltd. and Uttara Bank Ltd. have subsequently been transferred to the private sector with effect
from January 1985. Moreover at present there are 51 scheduled banks operating allover the country. Out
of these, 9 are state-owned (including five specialized banks), 30 are private commercial banks (including
four Islami banks) and the remaining 12 are foreign commercial banks (including one Islami bank).
3.1.3 Regulation of the Banking Industry in Bangladesh:
Bangladesh Bank, being the central bank exerts supervisory controls over the banking sector. BB requires
that banks have a minimum paid up capital and reserve funds and that no person, family or company own
more than 10% of bank share personally, jointly or both. Bangladesh Bank may with prior Government
approval at any time change the policy regarding the reservation of risk-based capital of assets. BB may
determine policy to control advances by banking companies. BB has direct authority to appoint any new
Managing Director, General Manager, or CEO and BB can dismiss none so appointed without prior
approval. BB also has the power to supersede the Board of Directors of a banking company. BB is also
the official liquidator and has the power to give directions to a banking company and also remove directors
when it feels that this may be in public interest. Banking companies in Bangladesh are not allowed to form
subsidiaries, although this rule may be amended soon.
The World Bank recently called BB as “a weak central bank” in its report entitled ‘Bangladesh: Key
Challenges for the Next Millennium’. The functions and responsibilities of BB are not clearly defined,
and it lacks autonomy in such core areas as the licensing of new banks, monetary and exchange rate
policies, and the supervision of NCBs. Banks are allowed to operate even though some of them suffer
from capital deficiency. Loan classification and provisioning are not fully enforced, and no punitive
measures are taken against banks that fail to implement agreed corrective measures. BB would be unable
to deal with a banking sector crisis if one were to occur. With over 6,200 staff, of whom 1,720 are clerical,
BB is significantly overstaffed relative to the size of the financial system.

22
3.1.4 Current Status of the Banking industry:
Bangladesh's financial sector is dominated by the banking sector. The dominance of the banking sector
makes the financial sector vulnerable on the one hand, but highlights the crucial importance of the sector
in resource mobilization and economic growth, on the other. The role of the banking sector in accelerating
growth is contingent upon the soundness and depth of the sector. In Bangladesh the banking sector has
travelled through a journey where the sector has experienced several ups and downs. Reforms measures
have been undertaken in an attempt to improve upon the structural constraints of the sector.
Since large financial irregularities in Sonali and BASIC banks, monitoring and inspection of Bangladesh
Bank have increased. The central bank has also appointed observers in 14 banks and financial institutions,
both state-owned and private to check further deterioration of these banks and supervise closely to improve
their governance.
Profitability, measured by return on asset and return on equity, has been negative for the state-owned
banks (SCBs).For private commercial banks, though these indicators are positive, but very low. In case of
non-performing loans (NPL) similar performance is observed. Though the share of NPL to total loans in
SCBs has slightly declined in September 2015 from June 2014, the rate is still as high as 21.82%. On the
other hand, NPL in private commercial banks (PCBs) and foreign commercial banks (FCBs) have
increased. Because of high NPL, state-owned banks have to make larger provisions. The government has
to inject capital into these banks to keep them going. Clearly, implementation of BASEL III requirements
that call for capital adequacy ratio to be raised to 12.5% of their risk-weighted assets by 2019 will be
challenging for the SCBs. As of September 2015, capital adequacy ratio of SCBs was only 6.2%.
Lower profits in SCBs are mainly due to bad assets, inefficiency and political interference. In case of
PCBs, stricter compliance requirements by the central bank and low appetite for credit by the private
sector due to sluggish business environment are the major reasons for lower profits. This is reflected
through high volume of liquidity in banks. The advance-deposit ratio has been little over 70% in
November 2015 even though banks are allowed to lend up to 80% of their total deposit.
The banking sector has achieved considerable success due to the reforms in the 1990s, 2000s and
afterwards. However, the sector will have to prepare for the next generation of global regulatory
framework and meet emerging clients' needs. In the coming days, the banking industry will have to
achieve the ability to absorb shocks arising from financial and economic stress, improve risk management
and governance, and strengthen banks' transparency and disclosures. And if the sector has to play the
larger role of contributing towards a stable and sound macroeconomic situation, the banking sector has to
go through the painful path of stricter policy and legal measures.

23
3.2 Main Competitors [Based on their Market Capitalization or Asset Size]
Table 3.1: Asset Size of Private Commercial Bank
Name of Private commercial
Banks
(3rd generation)
Year of established Total Assets
[BDT in Million]
BASIC Bank Limited 1988 204,739
Mercantile Bank Limited 1999 204,127
Eastern Bank Limited 1992 212,377
Prime Bank Limited 1995 256,599
Bank Asia Limited 1999 253,195
Dhaka Bank Limited 1995 202,191
Justification of selection to Basic bank Limited Compare With Eastern Bank Limited:
 Both of the banks belong to 3rd
generation.
 Both are scheduled bank.
 There are lot of similarities in their Asset liability portfolio.
Now, I discuss about the strength and weakness about Basic Bank Limited:
Strength:
 DPS interest rate is higher than other private banks for 3 months at now. So it’s attract more
customers for DPS.
 Basic Bank Limited has nationwide image of providing quality service. It provides excellent and
prompt services with higher degree of secrecy to corporate and mass level of customers.
 Basic Bank abides by a set of core values that reflects high commitment to customer:
1. Responsive to customers’ needs.
2. Flexible in approach
3. Strive for service excellence.
 A group of qualified experienced, dedicated and well trained personnel employing the best
effort to accomplish the organizational objective.

24
Weakness:
 Basic bank should increase its ATM Booth in different locations of Dhaka city as well as outside
of Dhaka where it is operate.
 ATM booths are not available like DBBL, AB Bank etc.
 There are various products and schemes of loans and advances but customer are not
Known to all of them.
 The appropriate employees are not in the appropriate position.
 Online Banking quality and service is poor than the other private bank.
 Basic bank website page sometimes server getting down.
 Website design, option are not updated more than other banks.

25
3.3 Problem Identification, Identify a Specific Issue and Analysis:
Literature Review
3.3.1 Loan Performance
Financial soundness of a bank depends on the performance of its disbursed loan on various sectors.
Loan performance means how the loans were scheduled to act and how they are actually acting. If
loan payment due less than 90 days its call preforming loan. Loan performance related with timely
and steady repayment of interest and principal of a loan. A loan is called well performed when its
repayment is properly made. If a loan fails to repaid properly on time for some consecutive period
then it’s called Non-performing loan. Non-performing loan is not good for a bank, because it is not
profitable for bank. The excessively high level of non-performing loans in the banks caused by the
absence of credit risk management practices.
(Whalen, 1994) Observed that the US Office of the Comptroller of the Currency found the difference
between the failed banks and those that remained healthy or recovered from problems was the caliber of
management. Superior mangers not only run their banks in a cost efficient fashion, and thus generate
large profits relative to their peers, but also impose better loan underwriting and monitoring standards
than their peers which result to better credit quality. On the other hand (Cornelis, 2011) suggested that a
more or less level of non-performing loans, though it may vary slightly from year to year, is caused by
an inevitable number of “wrong economic decisions” by individuals and risk management. Credit risk is
by far the most significant risk faced by banks and the success of their business depends on accurate
measurement and efficient management of this risk to a greater extent than any other risk (Gieseche,
2004).

26
3.3.2 Problem Identification:
During my internship at BASIC Bank Bashundhara R/A Branch I worked General Banking and Credit
Division. I identify some problem while I worked these two divisions
Problem 1: There is no separate Customer Information or Customer Help desk at the branch. Because
of this sometimes customers are not happy with bank service.
Problem 2: In credit division there is no separate Recovery section or team at the branch. For this reasons
bank cannot take immediate action to recover the loan and legal action against Customer.
Problem 3: There is no separate asset valuation team and inspection team at Bashundhara branch. The
mortgage asset value might not be accurate because of asset valuation and inspection team.
Problem 4: In Branch there is no IT support staff. If anything goes wrong they inform to head office
and they send IT staff to take action. It takes more time even one day.
3.3.3 Process Credit Approval of BASIC Bank Limited
3.3.3.1 Approval Authorities of the individual and Corporate Loans
The approval authority of individual loan is mainly done by the Assistant General Manager (AGM) and
Manager (Credit) in a branch. But if the individual loan amount exceeds 10 lac Then AGM should inform
Head office about the loan for approval. For corporate loan approval authority is head office Credit
Executive Committee. This credit executive committee consists of Managing Director (MD), senior
executives and Deputy General Manager (Credit). If the loan amount is heavy then head office informed
the Bangladesh bank for approval.

27
3.3.3.2 Lending Criteria for General loan
Credit Division applies the general 5C’s to evaluate a general loan proposal. Which are-

Character 


Capacity 


Capital 


Conditions 


Collateral 

3.3.3.3 Lending Criteria for SME and Corporate loan
Entrepreneur: The promoter or entrepreneur of the proposed project should be creditworthy and capable
enough to run the project.
Viability of the project: The project should be viable from organizational, technical, commercial, financial
and economic point of view. The project should be technically sound and environment friendly.
Technology transfer in case of borrowed know-how ought to be ensured. Market prospect and potential
for the product has to be fully assured at competitive prices. There should be reasonable debt equity ratio
as determined by the bank on individual case basis. Debt service coverage ratio should be at least 2.5
times at the optimum level of production. IRR should preferably be not less than 20 percent.
3.3.4 Credit collection of BASIC Bank Limited
3.3.4.1 Collection Processes:
Once the credit approved, customers are provided with an offer letter or banking arrangement letter during
loan disbursement where the total payment mood and loan details are described. If a customer fails to
fulfill terms which agreed by him or misses the required payment, then the loan enters into collection.
Recovery section is responsible for collecting the overdue amount from the customer. Generally if a
customer failed to payment the required amount 3rd
time, then the loan entries into collection.
3.3.4.2 Collection Steps:
The following steps followed by BASIC Bank to collecting a loan. Bangladesh bank orders each bank to
follow these steps carefully to collection of a loan.

28
Table 3.2: Collection Steps
Days Past Due (DPD) Collection Action
1-4 Letter, Follow up & Persuasion over Phone
15-29 1st Reminder letter &Sl. No. 1 follows
30-44 2nd Reminder letter + Single visit
45-59 3rd Reminder letter
Group visit by team member
Follow up over phone
Warning on legal action by next 15 days
60-89 Call up loan
Final Reminder & Serve legal notice
Legal proceedings being
90 and above Telephone calls/legal Proceeding continue
Collection effort continues by officer
Letter to different banks
3.3.5 Classification & Credit Loss Recognition Policy
Bank makes most of the profit through give loan to customers. So it is very important to find out which
customer can fail to give their payment on time. There is a credit policy to identify this kind of loan. The
objective of this policy is to ensure timely recognition of credit losses. This policy applied for all kinds
of consumer and corporate loans.
3.3.5.1 Non-performing Loan:
The term Non-performing loan means those loan which might be fall into the risk grade because of their
bad performance and difficult to recovery. Non-performing loan are classified as risk grade- Sub
Standard (SS), Doubtful (DF) and Bad & Loss (BL). These kinds of cases hand over to the recovery
section for process of collection or find out the way to continue.
Sub Standard Accounts: Any 180 Days Past Due (DPD) accounts
Doubtful Accounts: Any 270 DPD accounts (minimum)
Bad & Loss Accounts: Any 360 accounts (minimum)

29
All these loans are called Non-Performing loan or classified loans. These classified loans SS, DF and
BL Days past Due might be varies because of characteristics of the loan (Limited, 2016).
Table 3.3: Classification of Non-performing Loan
Types of Loan Sub Standard Doubtful Bad & Loss
Overdue Period Overdue Period Overdue Period
Continuous loan 6 months or more but 9 months or more but 12 months or more
less than 9 months less than 12 months
Demand Loan 6 months or more but 9 months or more but 12 months or more
less than 9 months less than 12 months
Term Loan ( up to 5 6 months or more but 12 months or more but 18 months or more
years) less than 9 months less than 18 months
Term Loan ( Over 5 12 months or more but 18 months or more but 24 months or more
years) less than 18 months less than 24 months
Short Term 12 months or more but 36 months or more but 60 months or more
Agricultural & Micro less than 36 months less than 60 months
Credit
3.3.6 Provisioning Procedures of BASIC Bank Limited:
3.3.6.1 General Provisions:
A General debt provisions must be evaluated and raised as soon as accounts are enter into
classified as SS, DL and BL. General provision should be raised in percentage of the total
amount of the loan as per Bangladesh bank rule.

30
Table 3.4: Rate of General Provision
Types of Loan and Advance Standard SS DL BL
House Building and 2% 20% 50% 100%
Consumer
loan to Professionals
Finance
Other than house 5% 20% 50% 100%
building and
Professionals
Small and Medium Enterprise 0.25% 20% 50% 100%
Short term Agricultural and Micro 5% 5% 5% 100%
Credit
All other 1% 20% 50% 100%
3.3.7 Loan Rescheduling
3.3.7.1 Rescheduling of Term Loans:
The loan which is repayable within a specific time period under a proper repayment schedule is called
as term loan. For rescheduling term loans following policies followed by BASIC Bank:

Application for first rescheduling will be considered only after cash payment of at least 15%
of the overdue installments or 10% of the total outstanding amount of loan, whichever, is
less; 


Second time rescheduling application will be considered after cash payment of minimum 30%
of the overdue installments or 20% of the total outstanding amount of loan, whichever, is less; 
Only two times term loan holder can apply for rescheduling a loan. If any customer fail to payment
the required amount or apply for third time for rescheduling a loan then that loan goes under
monitoring.

31
3.3.7.2 Rescheduling of Demand and Continuous Loan:
Continuous loan called those loans which can be operated without any specific repayment schedule
but there is end date for repayment and a limit. In addition, the loans which become repayable after
those are claimed by the bank are treated as Demand Loans. If any contingent or any other liabilities
are turned to forced loan those also are treated as Demand Loans. For rescheduling of Demand and
Continuous Loans, the rates of down payment shall be as under:
Table 3.5: Rescheduling Demand and Continuous Loan
Amount of Overdue Loan Rates of Down Payment
Up to Tk. 1.00 core 5%
Tk. 1.00 core to Tk. 5.00 core 10% (But not less than Tk.15 lac)
Tk. 5.00 core and above 5% (but not less than Tk. 50.00 lac)
3.3.8 Ratio Analysis
In ratio part I analysis non-performing loan ratio, return on asset and capital adequacy to find out the
loan performance and current Loan performance situation compare with eastern bank Limited (EBL).
Below the table is 5 years status of two banks Ratio:
Table 3.6: Ratio Analysis
Year Capital Adequacy Non-Performing Lone Return on Asset
BBL EBL BBL EBL BBL EBL
2012 10.05% 12.05% 8.22% 3.17% 0.03% 1.72%
2013 (1.66%) 11.95% 29% 3.59% (0.40%) 1.68%
2014 (29.08%) 13.22% 57% 4.36% (0.67%) 1.28%
2015 (7.55%) 14.24% 51% 3.27% (1.72%) 1.23%
2016 (15.59%) 15.10% 54% 2.69% (7.49%) 1.33%

32
Chart 3.1: Capital Adequacy Ratio
The capital adequacy ratio (CAR) is a measure of a bank's capital. It is expressed as a percentage of a
bank's risk weighted credit exposures. Banks with high capital adequacy ratios are less likely to become
insolvent as a result of unexpected losses because they can absorb the loss. We can see BASIC bank CAR
shows that they don’t have enough ability to absorb the loss.
Every bank should maintain a minimum level of capital to handle the uncertain losses. But in the chart
we can see BASIC Bank has negative capital adequacy ratio in last 4 years. That is mean bank do not
have enough money to handle the uncertain risk and possibility to become insolvent. BASIC bank gave
more loans to the client which is out of bank loan capacity.
10.05%
-1.66%
-29.08%
-7.55%
-15.59%
12.05% 11.95%
13.22% 14.24% 15.10%
-35.00%
-30.00%
-25.00%
-20.00%
-15.00%
-10.00%
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
2012 2013 2014 2015 2016
Capital Adequacy Ratio
Series1 Series2

33
Chart 3.2: Non-performing Loan Ratio
Non-performing Loan means borrower is not able or likely to payment the loan for at least 90 days. High
Non-Performing Loan is not good for bank, because it affect the bank profit. Non-performing Loan in
BASIC Bank is quite high in recent years it is mean bank loss their profit.
BASIC Bank does not follow the credit risk management steps properly. This is one of the major reasons
of increasing Non-performing. BASIC Bank has weak leading policy which is the main reason to high
non-performing loan. When a client apply for loan it is mandatory to check client last 6 month account
details and CIB report but BASIC Bank does not follow these steps for corporate client. The recovery and
monitoring unit are not strong to give early warning about the non-performing loans.
8.22%
29%
57%
51%
54%
3.17% 3.59% 4.36% 3.27% 2.69%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
2012 2013 2014 2015 2016
Non-performing Loan Ratio
Series1 Series2

34
Chart 3.3: Return on Asset Ratio
Return on Asset (ROA) indicates how a bank profitable relative to its total asset. It also shows how
management utilize it assets properly to make profit. In recent past years BASIC Bank ROA shows
Negative figure. Its means management is not utilizing it assets properly.
Poor management policy is the main reason for negative ROA of BASIC Bank. Recent past BASIC
Bank does not follow any particular management policy to utilize their assets properly. Loan is asset
for the bank and bank makes most of their profit through it. But in the case of BASIC Bank they gave
their loan to the customers without any cross check any information about the customer. Even BASIC
bank sanction loan to non-existent Company and individual. From those loans bank does not make any
profit that is the reason BASIC Bank have negative ROA.
0.03%
-0.40% -0.67%
-1.72%
-7.49%
1.72% 1.68%
1.28% 1.23% 1.33%
-8.00%
-6.00%
-4.00%
-2.00%
0.00%
2.00%
4.00%
2012 2013 2014 2015 2016
Return on Asset Ratio
Series1 Series2

35
Chapter 4: Conclusion & Recommendation

36
4.1 Conclusion
From the analysis I found that the main problem of BASIC Bank Limited is not follow the proper
credit policy to give loan. That is why they face high level of Non-performing loan.
Nowadays BASIC Bank Limited maintains their operation in smooth way. Though they face problem in
the field of corporate loan. There is no proper owned credit policy for BASIC Bank Limited. In the last 5
years management continuously give loan to their client without any proper documentation. This is the
cause of increasing of default loan and loss their profit. Even their capital adequacy ratio is negative its
means BASIC Bank is not solvent. BASIC Bank Limited follows the credit policy of Bangladesh Bank.
BASIC Bank Limited should increase their Credit Division activates to give loan and recover the loan. If
the can do this and maintain it I think BASIC Bank can overcome this problem.

37
4.2 Recommendation
Few suggestions and recommendations have been provided here so that bank can survive better in
future:
1. BASIC Bank should have separate customer information or help section at each branch to increase
the customer satisfaction.
2. BASIC Bank should strong their Recovery Section and Loan management to less the NPL.
3. BASIC Bank should have a clear written guideline for CMR. Especially the landing
guideline should include limit of loan amount for a company or individual.
4. BASIC Bank should provide better training to the employee about Credit Risk
Management.
5. To motivate the employees to their job and should determine the employees job
performance.
6. IF anyone doing wrong in his job position then that person should punished and legal
procedures.
7. More ATM booth must be introduced in near to every Commercial place.

38
Reference
Cornelis, A. B. (2011). The Macroeconomic statistical Treatment of Nonperforming Loans.
Statistic Department of the International Monetary Fund.
Gieseche, K. (2004). "Credit risk modeling and Valuation: An Interdiction". London: Corell University.
Limited, B. B. (2010). About Bank. Retrieved October 23, 2016, from BASIC Bank
Limited: http://www.basicbanklimited.com/about_us.php?about_us=1
Limited, B. B. (2010). CSR Activities. Retrieved October 22, 2016, from BASIC Bank
Limited: http://www.basicbanklimited.com/csr.php?csr=1
Limited, B. B. (2016). Annual Report 2016. Dhaka: BASIC Bank Limited.
Whalen, R. D. (1994). "Banking Industry Consolidation: Efficiency Issues". The Jerome Levy
Economics Institute. Washington, DC.
Limited, B.B. (2016). Annual Report 2016. Dhaka: BASIC Bank Limited.
Research Director, Centre for Policy Dialoque (CPD) “Banking Sector for Sustainable Growth”, The
Daily Star, Modified: 1:46PM, April 18, 2017.

39
Appendix A
Loan Product
1. Agriculture 10.00%
2. Agro Based Industries 11.50%-12.50%
3. Micro and Cottage IndustryEnterprise 12.50%
4. Small IndustryEnterprise 12.50%
5. Medium IndustryEnterprise 12.75%
6. Large Industry (Manufacturing and Service) 12.75%
7. Commercial Lending (Business Commercial Trading) 13.00%
8. Loan against documentary bills accepted by bank 11.00%
9. Trade Financing 7.00%-13.00%
10. Other Short Term Loan (STL) 10.00%-13.00%
11. Other Demand/ Forced Loan 13.00%
12. Advance/ Loan against Work Order including STL 13.00%
13. Overdraft against ( in case OD against FDRs having various rate, 11.00%
weighted average of FDR rates would be taken as basis)
14. Consumer Finance 12.00%
15. Credit to Real Estate ( Industrial/ Commercial) 12.00%
16. Credit to NBFI 11.00%
17. Wholesale Finance to NGOs/ MFI etc. 10.00%
18. Transport ( Industrial/ Commercial) 12.00%

LOAN PERFORMANCE OF BASIC BANK LIMITED, BANGLADESH

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