A WORKING REPORT ON THE L\C OPENING SYSTEM OF

DUTCH BANGLA BANK LTD.

By

Mahafuza Alam
ID 0730103

An Internship Report Presented in Partial Fulfillment

Of the Requirements for the Degree Bachelor of Business Administration (BBA)

INDEPENDENT UNIVERSITY, BANGLADESH

8th December, 2011

A WORKING REPORT ON THE L\C OPENING SYSTEM OF

DUTCH BANGLA BANK LTD.

By

Mahafuza Alam
ID 0730103

has been approved

December, 2011

Mr. Saquib Shariar

Lecturer, Finance and Accounting
School of Business
Independent University, Bangladesh

Letter of Transmittal
Saquib Shariar
Lecturer, Finance and Accounting
School of Business
Independent University, Bangladesh

Subject: Submission of the internship working report.

Dear Sir,
With great pleasure I submit this internship report on A WORKING REPORT ON THE
L\C OPENING SYSTEM OF DBBL as per the Advisors instruction. I expect this report
to be informative as well as comprehensive.

Working in Dutch Bangla Bank Ltd was an inspiring experience for me. I feel the immense
knowledge and experience will facilitate me a lot in my future career life. With my limited
knowledge, I have tried my level best to prepare the report worthwhile.

Your acceptance and appreciation would surely inspire me. For any further explanations
about the report, I will be gladly available to clarify the ins and outs.

Sincerely Yours,

------------------------------------Mahafuza Alam
ID: 0730103

Acknowledgement
I would like to express my gratitude to all the people that were involved both directly and
indirectly in the preparation of this report. I apologize to the people whose names that I
have not mentioned, and their contribution is highly appreciated by me.

At first, I would like to thank my academic supervisor Saquib Shariar Lecturer,

Independent University, Bangladesh for guiding me and for giving me the opportunity
to initiate this report. More specifically, I would like to thank him for imparting his time
and wisdom.

I want to thank all the officials of Dutch Bangla Bank Limited that were involved. I
would especially like to thank Kazi Towhidul Alam (SEVP), Md. Abdul Awal (SEVP)
and Ahamed Zahangir Alam (AVP) of Local Office for giving me time and sharing their
thoughts and insights regarding their Knowledge and their bank as a whole. I would like
to thank them for giving me the required information to commence this report and for
providing the permission to do the required work.

Finally I want to express my special thanks to the Human Resource Department of

DBBL for providing the opportunity to make my internship program in this organization.
At last ,I owe a particular thanks and express my heartiest gratefulness and indebtedness
to my parents and those who have contributed me to carry on academic career.

Executive Summary
Todays business world is dynamic and competitive therefore organizations looking for
Talent, extrovert graduates who belong to high degree of adaptability quality. Todays
business graduates will be the core part of business organization. Therefore, business
graduates need to have both theoretical & practical knowledge to manage the business
activity properly. In order to be familiar with organizational culture and to gain some
practical knowledge about an organization our University provides a twelve weeks
internship program as a part of the BBA program.
Dutch-Bangla Bank is the first bank in Bangladesh to be fully automated and introduce
Electronic Banking. The automation was completed in 2003, but further additions and
features are continuously being added and upgraded.

Dutch-Bangla Bank Limited started its banking services with a view to minimize the
customers needs by offering different products and services which are easy and
affordable for all level of customers. To that extent, DBBL always emphasizes its
customer services, product development, resource management, branch networking and
the contribution to the economic development of the country.

The bank also provides social services towards the society.

DBBL Internet banking enables customer to access his/her personal or business accounts
anytime anywhere from home, office or when traveling. Internet Banking gives customer
the freedom to choose his/her own banking hours. It can save time, money and effort. It's
fast, easy, secure and best of all.

DBBL, since its inception was active in various social activities, which increased
manifold over the period of time and its growth. It is one of the fast growing leading
online banks in private sector.

TABLE of CONTENTS
Pages
CHAPTER- One
1.0 Origin of The Report..............1
1.1 Objective of the Report......................1
1.2 Methodology......1
1.3 Source of Information...................................1
1.3.1 Primary source.....................................1
1.3.2 Secondary Source................... .1
1.4 Scope of Study.......................................2
1.5 Limitation of the study.......................................2
CHAPTER -Two
2.0 Historical Back Ground of DBBL ........................................3
2.1 Mission...........................................4
2.3 Vision.............................................4
2.4 Core Objective of DBBL...............................4
2.5 Business Objective of DBBL.........................................4
C HAPTER Three
3.0Letter of credit (L/C) Documentary Credit.....................5
3.1 Forms of Letter of Credit...........................................5
3.2 Types of Letter of Credit........................................5
3.3 Contents of Letter of credit............................6
3.4 Parties to a Letter of Credit................................6
3.5 Procedures of Opening the L\C..............................................6
3.6 Amendment of L\C.................................................8
3.7 Meaning of Back to Back L\C............................................9
3.8 Procedures of Back to Back L\C....................9
3.9 Payment under Back to back L\C...................................9
3.10 Security.................................................9
3.11 Margin..........................................................9
3.12 Documentary Letter of credit (Import / Export documentation...................9
3.13 Payment Against Documents (PAD)..............................................10
3.14 Lodgment and retirement of import Bills (Under Cash L\C).10
3.14 1 Lodgment of Import Bill.........10
3.15 Procedures of lodgment..................................................10
3.16 Preparation of Voucher...............................11
3.17 Retirement of Documents...........................11
3.18 Security of documents........................................11

CHAPTER-Four
4.0 The Nature of the Jobs and my Specific Responsibilities............12
4.1 Observation & Findings.......................................12
CHAPTER-Five
5.0 Recommendations & Suggestions for DBBL..........................................13
CHAPTER-Six
6.0 Conclusion.14
Reference
Appendix
Appendix-A: List of Charges
Appendix-B: L/ C opening Diagram
Appendix-C: Few required Documents of L/C

Chapter-1
1.0 Origin of the Report
Now it is the era of Business & Technology. To keep pace with the Education system has
become more and more practical and as a result practical knowledge has got priority. To
provide professional knowledge and experience to the business students on actual picture
of the business industry it requires practical orientation and exposures through internship
within a specific period. The program contains indispensable practical orientation in
different organizations as a part of the course curriculum. Under this curriculum students
are sent to gather practical knowledge about organizational environment and activities.
1.1 Objective of the Report
The main objective of this report is to have an assessment on L\C opening system of
Dutch-Bangla Bank Ltd. I tried my best to know how the Bank is providing facilities to
its clients & to suggest remedial measure for the development of banking activities if
required.
1.2 Methodology
To prepare this paper and collection of informations both primary and secondary sources
are used. To realize the original picture & procedures of different banking services I had
to observe the operations and stayed in touch with the Officials of DBBL. Moreover, I
had to converse and interviewed the concern Officers. Sometimes I had to discuss with
the customers about their service, demand and satisfaction. However, the following
sources are used to prepare this paper.
1.3 Source of Information
The report was fully investigative in nature. Data have been collected from two sources:
1.3.1 Primary Sources:
Discussion with the concern Officials of DBBL
Discussion with the customers
Expert Opinion
1.3.2 Secondary Sources:
Website of Dutch Bangla Bank Limited
Annual Report of DBBL
Different papers of Dutch-Bangla Bank Ltd.
Unpublished data.
Different text books.

1.4 Scope of the Study

This report has been prepared through extensive discussion with bank employees and
with the clients. While preparing this report, I had a great opportunity to have in depth
knowledge of all the banking activities practiced by the Dutch-Bangla Bank Ltd.
1.5 Limitations of the Study
The present study was not out of limitations. But as an intern it was a great opportunity
for me to know the banking activities of Bangladesh specially Dutch-Bangla Bank Ltd.
Some restraints are disclosed bellow:
The main constraint of the study is insufficiency of information, which was required for
the study. There are various information the bank employee can't provide due to security
and other corporate obligations.
Due to time limitations many of the aspects could not be discussed in the present report.
Every organization has their own secrecy that is not revealed to others. While collecting
data through interviewing the employees, they did not disclose much information for the
sake of the confidentiality of the organization.
Since the bank personals were very busy, they could provide me very little time.
Another significant problem faced during the preparation of this report was the
contradictory explanation of a single subject by different employee.

Chapter - Two
2.1 Historical Back Ground of DBBL:
Dutch-Bangla Bank Limited is a scheduled commercial bank. The Bank was established
under the Bank Companies Act 1991 and incorporated as a public limited company under
the Companies Act 1994 in Bangladesh with the primary objective to carry on all kinds of
banking business in Bangladesh. The Bank is listed with Dhaka Stock Exchange Limited
and Chittagong Stock Exchange Limited. DBBL- a Bangladesh European private joint
venture scheduled commercial bank commenced formal operation from June 3, 1996. The
head office of the Bank is located at Senakalyan Bhaban (4th, 5th and 6th floor), 195,
Motijheel C/A, Dhaka, Bangladesh.
The Bank commenced its banking business with one branch on 4 July 1996. DBBL a
public company limited by shares, incorporated in Bangladesh in the year 1995 under
companies Act 1994. With 30% equity holding, the Netherlands Development Finance
company (FMO) of the Netherlands is the international co-sponsor of the Bank. Out of
the rest 70%, 60% equity has been provided by prominent local entrepreneurs and
industrialists & the rest 10% shares is the public issue. During the initial operating year
(1996-1997) the bank received skill augmentation technical assistance from ABN Amro
Bank of the Netherlands.
DBBLs focus is to provide one counter service to clients covering: Commercial Banking
(Deposit Accounts), Consumer Banking (Retail Baking) - Traveler Cheques- Foreign &
Inland Remittances, Financial Services, Corporate Banking, Asset & liability
management, Liquidity & capital Resources Management, Information technology,
Human Resources.
DBBL Internet banking enables customer to access his/her personal or business accounts
anytime anywhere from home, office or when traveling. Internet Banking gives customer
the freedom to choose his/her own banking hours. It can save time, money and effort. It's
fast, easy, secure and best of all.
DBBL, since its inception was active in various social activities, which increased
manifold over the period of time and its growth. It is one of the fast growing leading
online banks in private sector make sound loans and investments.
To build up a low cost fund base.
To meet capital adequacy requirement at all time.
To install a scientific MIS to monitor banks activities.
To ensure 100% recovery of all advances.
To adopt appropriate management technology.
To ensure a satisfied work force.
To focus a free-based income.

The emergence of Dutch-Bangla Bank Ltd. in the private sector is an important event in
the banking area of Bangladesh. The Netherlands Development Finance Company (FMO)
of the Netherlands is the international sponsor of the Bank. The FMO is the Dutch
development bank of the Netherlands specialized in the financing of private enterprises in
Asia, Africa, Latin America and Eastern Europe.
2.2 Mission:
Dutch Bangla Bank engineers enterprise and creativity in business and industry with a
commitment to social responsibility. PROFIT ALONE does not hold a central focus
in the banks operation; because man does not live by brain and butter alone .
2.3 Vision:
To become a leading banking institution and play a pivotal role in the development
of the country
DUTCH BANGLA BANK dreams of better Bangladesh, where arts and letters, sports
and athletics, music and entertainment, science and education, health and hygiene, clean
and pollution free environment and above all a society based on morality and ethics make
all our lives worth living. DBBLs essence and ethos rest on a cosmos of creativity and
the marvel magic of a charm life that abounds with sprit of life and adventures that
contributes towards human development.
2.4 Core Objective of DBBL:
Dutch-Bangla Bank intends to pave the way for a new era in banking that uphold and
epitomize its vaunted marques Your Trusted Partner.
2.5 Business Objectives of DBBl:
To make sound loans and investments.
To build up a low cost fund base.
To meet capital adequacy requirement at all time.
To install a scientific MIS to monitor banks activities.
To ensure 100% recovery of all advances.
To adopt appropriate management technology.
To ensure a satisfied work force.
To focus a free-based income.

Chapter-Three
3.0 Letter of credit (L/C) Documentary Credit:
The most important of the payment methods used universally is a Letter of Credit which
is also called Documentary Credit, which serves as a bridge between buyers and sellers
around the world in the exchange of goods and commodities.
In other words it can be said that a letter of credit is an instrument issued by a bank on
behalf of the importer to make payment of agreed sums in foreign currency as stipulated
to the exporter when the conditions specified in the document are met.
3.1 Forms of Letter of Credit
There are many types of Letter of Credits that are used in different countries of the world.
But International Chamber of Commerce (ICC) vides their UCPDC- 500, which denotes only
two types of LETTER OF Credits & DBBL also followed ICC : There as below:
i)
Revocable letter of credit
ii)
Irrevocable letter of credit
i) Revocable letter of credit: If any letter of credit can be amendment or charge of any
clause or canceled without the consent of the exporter and importer is known as revocable
letter of credit. It can be amended or canceled by the issuing bank at any time without
prior notice to the beneficiary. It does not constitute a legally binding undertaking by the
bank to make payment.
ii) Irrevocable letter of credit: If any letter of credit cannot be changed or amendment
without the consent of the importer and exporter is known as irrevocable letter of credit. It
constitutes a firm undertaking by the issuing bank to make payment. It therefore, gives
the beneficiary a high degree of assurance that he will be paid to his goods or services
provide he complies with terms of the credit.
3.2 Types of Letter of credit
Letter of credit is classified into various types according to the method of settlement
employed. All credits must clearly indicate in major categories.
i)
Sight payment credit
ii)
Deferred payment credit
iii)
Acceptance credit
iv)
Negotiation credit
v)
Red close credit
vi)
Revolving credit
vii) Standby credit
viii) Transferable credit

3.3 Contents of Letter of credit

Dutch Bangla Bank normally issued letter of credit (L\C) on forms which clearly indicate
the banks name and extent of the banks obligation under the credit. The contents of the
information:
i)
Name of the buyer
ii)
Name of the seller
iii)
Moment of the credit
iv)
Trade terms
v)
Tenor of the draft
vi)
Expiration date
vii)
Documents required
viii)
General description of the merchandise
3.4 Parties to a Letter of Credit
A letter of credit is issued by a bank at the request of an importer in favor of an exporter
from whom he contracted to purchases some commodity or commodities. The importer,
the exporter & the issuing bank are parties to the letter of credit. There are however, one
or more then one banks that are involved in various capacities & at various stages to play
an important role in the total operation of the credit.
i)
Opening Bank
ii) Advising bank
iii) The Buyer and the Beneficiary
iv) The Paying bank:
v) Negotiating bank
vi) Confirming bank
3.5 Procedures of Opening the L\C
When the importer receives the proforma invoice from the exporter, then the importer
applies for the issue of a documentary credit and requests his bank to make a promise of
payment to the supplier. Obviously, the bank will only agree to this request if it can rely
on reimbursement by the applicant. As a rule accepted as the sole security for the credit
particularly if they are not the short of commodity that can be traded on an organized
market, such as arrangement would involve the bank in excessive risk outside its
specialist field.
The applicant must therefore, have adequate funds in the bank account or a credit line
sufficient to cover the required amount.
Once the bank has issued the credits its obligation to pay is conditional on the
presentation of the stipulated documents within the prescribed time limit. The applicant
cannot prevent a bank from honoring the documents on the grounds that the beneficiary
has not delivered goods on redder reissues as contracted.

 The selected persons on instructions those who have Tax Identification Number (TIN),
valid trade license and gotten valid Import Registration Certificate (IRC) form the Chief
Controller of Import and Export (CCI & E) can import and they are known as importers.
Now, the importer will come to his bank with a request to open an L\C along with the
following documents/ Papers:i. L\C application and agreement Form ( Banks prescribed application form) with
adhesive of Tk. 150 (Flexible) [from June 3rd 1998]
ii. Indent / Preforma Invoice / Contract 3 copies.
iii. Insurance cover note with premium paid receipt.
iv. IMP Form one set duly signed by the importer.
v. Any other documents if necessary.
Authorized Dealer (AD) will scrutinize the documents and open the L\C in favor of the
exporter by converting the Bangladesh Taka into foreign currency at the existing B.C
selling rate of exchange. Care must be taken so that the limit of Bangladesh Taka is not
exceeded in any way.
The foreign currency value of the L\C must correspond the equivalent amount of
Bangladesh Taka if LCA registered with Bangladesh Bank.
The Authorized official of the Authorized Dealer will check the L\C very carefully and
signed the same jointly and forward the 1st & 2nd copy to their foreign correspondent
situated at the nearest place of the exporter. This bank is known as Advising Bank. On
receipt of the L\C, the Advising Bank verify the duplicate copy at the end.
By getting the L\C , the exporter prepares the goods and ship the same as per
instruction of the L\C and obtain a Bill of Lading from the shipping Authority.
The exporter will prepare Bill of Exchange, Invoice and other documents as specified
in the L\C and submit the same along with the original copy of L\C to his bank within the
time mentioned in the L\C. The bank with whom the exporter submits the documents is
known as Negotiating Bank as this negotiates the documents i.e. make payment to the
exporters.
The Negotiating Bank will scrutinize the documents with terms and conditions of the
L\C very carefully. If everything is in order, the bank will make payment of the amount of
L\C to exporter in their local currency by debiting to their own account.

Subsequently the negotiating bank will claim the L\C with whom the Head Office of
L\C opening bank maintained foreign currency amount. This is known as Reimbursing
bank. Reimbursing Bank will make payment to the Negotiating Bank by debit to L\C
Opening Banks Head Office A\C.

 Simultaneously the negotiating bank will forward all the documents Submitted by the
exporter to the L\C opening bank as per instruction of the L\C. The date of forwarding
letter of negotiating bank should be date of negotiation of documents.
On receipt of the shipping documents from the Negotiating Bank , the L\C opening
bank will carefully scrutinize the documents with terms and conditions of the relative
L\C.
If there is no discrepancy, the documents will be lodged. Lodgment of documents
means the entry of the particulars of the documents in the Register and preparation of
vouchers by converting the foreign currency amount into Bangladesh Taka as the
exchange rate prevailing on that date.
This amount is due to the importer. The importer will be asked to take delivery
document by making payment of the bill amount excluding the margin deposited at the
time of opening L\C. Payment of bill amount and to take delivery of documents by the
importers is known as Retirement of Importer Bills.
After taking delivery of documents from the L\C opening bank, the importer will clear
the goods which has already been arrived or due to arrive from the customers authority
on submission of these documents along with the customer purpose copy of L\C From.
3.6 Amendment of L\C
In case of revocable L\C, amendment can be brought without prior notice of the
beneficiary or issuing bank. But in case of irrevocable L\C , prior notice of the
beneficiary is essential. Issuing bank will accept amendment of the L\C after consent of
both the importer and exporter. L\C amendment are to be communicated by Telex,
SWIFT or Mail. The following clauses of L\C are generally amended:
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.

Increase/ Decrease value of L\C and Increase / Decrease of quantity of goods.

Extension of shipment/negotiation period.
Terms of delivery i.e, FOB,CFR ,CIF etc
Mode of shipment
Inspection clause
Name and address of suppliers
Name of the reimbursing bank
Name of the shipping line etc.

3.7 Meaning of Back to Back L\C

As per existing provisions recognized export experiment units are permitted to make
import of raw materials and packaging materials under Back to Back L\C arrangement
where import payments are made out of the realized proceeds of export of the
manufacturers product.

3.8 Procedures of Back to Back L\C

Exporter should make application for Back to Back L\C
Export L\C or Master L\C under is under lien
Opening of Back to Back L\C
Setting terms and conditions for back to Back L\C
3.9 Payment under Back to back L\C
Deferred payment is made in case of Back to Back L\C as 60,90, 120, 180 days of
maturity period . Payments will be given after realizing export proceeds from the L\C
issuing bank from the abroad.
3.10 Security

Lien and physical precession of the export L\c in favor of the bank
Imported items will be stored in a bonded warehouse under point
and effective control of bank and customs authority after clearing
through the approved C & F agent.

3.11 Margin
Difference between the value of export L\C in hand and the proposed Back to back L\C
which is minimum 305 of value of the export L\C will be treated as margin against
proposed L\C. Sometimes addition to this 10% margin is obtained.
3.12 Documentary Letter of credit (Import / Export documentation)
Documentary letter of credit is such kinds of commercial letter which a bank issue on
behalf of foreign seller (exporter) according to the direction of the (importer) purchasers.
The documents shown under are known as export documents from the importers side.
There are:i)
ii)
iii)
iv)
v)
vi)
vii)
viii)

Bill of Exchange
Bill of Lading
Airway bill / Railway receipt
Commercial Invoice
Insurance Policy
Certificate of Origin
Packing List
Bill of Entry

3.13 Payment Against Documents (PAD)

Banks deal in documents and not in goods. If the shipping documents against the L\C is
in order then the Dutch Bangla Bank must have to make payment to the foreign bank
within 3 days or 72 hours according as Uniform Customer and Patrice for Documentary
Credit (UCPDC) 500of revision of ICC.
If the shipping documents have any discrepancy, then DBBL inform to the negotiating
bank within 7 days. Otherwise, the shipping documents have not discrepancy. If the
importer have not adequate founds in the bank account, then the bank make payment to
the foreign bank against the shipping documents.

3.14 Lodgment and retirement of import Bills (Under Cash L\C)

3.14.1 Lodgment of Import Bill
The document letter of credit (L\C) constitutes of the important methods of financing
trade. Because of the phenomenal growth in world trade and commodity wise
diversification of trade its importance has significantly increased.
On receipt of the documents from the negotiating bank, DBBL will make entry the
particulars of the documents into Inward Foreign Bill Register and prepare the voucher by
converting the foreign currency into Bangladesh Taka. This stage is known as lodgment
of import bills.
The full sets of documents which are submitted by the exporter to his bank as per terms
and conditions to the L\C are known as shipping documents.
The L\C opening Bank may receive these shipping documents from his foreign
correspondent (Bank) in two ways:
i)
Documents on collections basis.
ii)
Negotiated Documents.
3.15 Procedures of lodgment:
After scrutinization ,if it is fund in order the officer concerned will brand a rubber stamp
Checked and found correct which will be followed by his initial.
Amount in foreign currency to be converted into Bangladesh Taka with the exchange rate
(B.C selling) prevailing on the date of lodgment. Particulars of documents to be entered in
the Inward foreign Bills Register

3.16 Preparation of Voucher: The following vouchers are to be prepared:

a) Lodgment voucher:
Dr. PAD/ Draft amount + negotiation Commission (if any)
Cr. H.O, I.D / (Reimbursing Bank)A\C
b) Liability voucher to be reversed which was originated at the time of opening L\C
Dr. Bankers Liability on L\C (cash)
Cr. Customer Liability on L\C (cash)
3.17 Retirement of Documents:
On receipt of the copy of lodgment voucher from the bank, the importer will deposit the
required amount & taka delivery of the shipping documents. This stage is known as
Retirement of Import Bills.
Before retirement of import bills, Dutch Bangla Bank will calculate the charge which are
to be realized from the importer.
Retirement Vouchers to be prepared:
Dr. Opener A\C
Dr. Sunday Deposit A\C (Margin on L\C)
Cr. PAD/ Draft Amount
Any other charges vouchers if necessary
3.18 Security of documents:
Dutch Bangla Bank being received the documents from the negotiated bank will
scrutinize the documents with the respective L\C terms & condition.
i)
ii)
iii)
i)
iv)

Forwarding Schedule of Negotiating Bank

Bill of Exchange
Bill of Lading
Commercial Invoice
Other Documents

Chapter-Four
4.0 The Nature of the Jobs and My Specific Responsibilities
I joined as intern at Dutch Bangle Bank, Local Office on 15th September. I was assigned
to GB (General Banking). I spent 4 weeks here. It was very arduous, but very fruitful. I
was under Ahamed Zahangir Alam (AVP), who was very intellectually intriguing. While
I working in General Banking, I used the Flex-club Retail banking software. With the use
of this software I learned how to Open Account, Balance Inquiry & Account Transaction
History. The work was really hard at GB. I also had to hear a lot of complaints from the
customers. At first I was demoralized. But later on I learned how to deal with it.
The 2 weeks I was posted in the foreign trade department. I did not have to deal with the
customers that much but there were I learnt how to Processing a new LC ( Letter of
Credit) , Filling up the Forms, Putting seals & Learned about The Foreign Regulation Act
1947 ,Doing the similar things for BTB (Back-to-Back) LCs and Local LCs
Then I was in the Clearing Department & pay order & Fund Transfer section for the 4
weeks. Although much work was not assigned to me in clearing department, I did assist
this department in whatever way possible. In clearing section I received chequs, learns
about different endorsement, crossing. Giving entry to Nikash software, which is widely
used in all the bank clearing house and send the cheque to Bangladesh Bank for
collection. In pay order & fund transfer section I partially issued pay order by myself.
4.1 Observation
It was very interesting working at Dutch Bangla Bank, Local Office . The people there
are really nice and talented. The things that I have noticed and observed are:
Work is never left pending for the next day unless it is absolutely necessary
The work process could be made faster with better computers and operating
systems.
A good job performance is rarely praised, hence lacking motivation of the
employees
There is always a rush of customers so there is no standard on what the employees
do throughout the day. The work activities of an employee is set, but what to do
when varies along the day
The work activities are always set and divided for each of the employees. This is
the way it should be, but when I saw it firsthand it was remarkable. Each and
every employee has a certain set of responsibilities. He/she carries out those
responsibilities throughout the day. It is also easy to assign duties that way. Even
though this is the case, I often saw other staff members helping each other out.

Chapter-Five
5.0 Recommendations & Suggestions for DBBL:
In order to get competitive advantage & to deliver quality service, top management
should try to modify the services. For the improvement of the service the following
measures should be taken:
i) Increase Limit on L/C Value: Every LC has limits on its total value, imposed on
them according to the Bangladesh Banks regulations, and based on the risk
factors. However the Banks stills has the authority to make some changes to
the limit within a certain specified range. Hence, if Dutch Bangla Bank is
more flexible than it can open more L/Cs with higher values thus increasing
their profitability, however in this case they would be taking more risk.
ii) Rate of interest on LTR: Payments for L/Cs could also made through pre
arranged credit facilities that the customer may have with the Bank. Usually,
the rates of interest on these credits are excessively high which actually
discourages the customers. Reducing interest on such credit facilities would
actually induce the clients to do more global trade thus increasing the banks
profit as well as the well being of the countrys Economy.
iii) LC margin BB: Before opening an L/C a customer is required to pay the bank a
certain percentage of the total L/C value in advance, called the margin. If
Dutch Bangla Banks reduces the rate of margin then perhaps they can attract
more customers. At the moment, Companies with good relationship with the
banks only benefits with lower margin level over others.
iv) Reduce Charges: In order to do any kind of foreign trade whether be it
Remittance, Export or even Import charges are applicable everywhere.
Charges includes, SWIFT charges (Charge for sending the L/C electronically),
Document Handling Charges, Stamps Charges as well as VAT. If such
charges could be reduced people Dutch Bangla Bank will definitely attract
more customers.

Chapter-Six
6.0 Conclusion
Modern Commercial Banking is exacting business. The reward are modest, the penalties
for bad looking are enormous. And commercial banks are great monetary institutions ,
important to the general welfare of the economy more than any other financial institution.
It has a vastly sobering and exacting responsibility.
DBBL conducts all type of modern commercial banking activities. It largely depends on
its foreign exchange business to ensure profitability. To look after the business and also to
ensure promote service to the export import and remittance, officers having exposure and
expertise in foreign exchange business have been posted both Head Office and
Authorized Dealer Branches.
Without bank co- operation, it is not possible to run any business or production activity in
this age. Export and import need finance in various stages of their activities. All facilities
of export, import & remittance are proved by DBBL. For this purpose banks consider the
borrowers business standing, integrity, liability with the bank term and conditions of the
L\C .There are lots of risks involved in foreign business.
So, DBBL have to clearly justify the customers from a neutral point and gather the
current information about the market. Overall, DBBL is emerging as a major contributor
to the financial system of Bangladesh through the financing. Besides bringing in greater
efficiency in the financial system through the various types of financing and advanced
services using information and advanced technology, DBBL is also helping to foster
economic development.

References
1. Annual Report of Dutch-Bangla Bank Limited, 2010-2011.
2. Brochures & Leaflets
3. www.dutchbanglabank.com
4. Khan A R, Bank Management: A Fund Emphasis, Ruby, first edition, 2008
5. Rose Peter. Commercial Bank Management.
Publishers.1996.

Third Edition: Irwin McGraw-Hill

Appendix
Appendix-A: List of Charges
SL

Type of Services

Nature
Charges

1.

2.

3.

of Amount of Charges
& Commission

(i) L/C opening commissions under

cash (sight)

Maximum @ 0.40%

(ii) L/C opening commissions

under cash (usance)

Maximum @ 0.50%

(iii) L/C Opening Commission for

Back to Back L/C on account of
export oriented garments or
specialized textiles
L/C opening commission where
100% cash margin is received.

Maximum @ 0.40%

for each quarter

for each quarter

for each quarter

Maximum @ 0.25%
for each quarter

Transmission/Despatch.
i) L/C

Charges

At Actual

ii) L/C Amendment

Charges

At Actual

iii) LC Confirmation

Charges

At Actual

iv) LC Cancellation

Charges

At Actual

v) FCC

Charges

At Actual

LC Amendment

Commission

Maximum Tk.750/-

5.

Arrangement of confirmation
by third Bank (Confirmation
charges at actual to be borne
by either opener or
beneficiary as the case may
be)

Commision

Maximum @ 0.20%

6.

Collection of credit report of

the beneficiary of the L/C by
Telex/ SWIFT/ Mail

Telex/ SWIFT/
Mail

At actual plus service

charges but
Minimum Tk. 500/-

7.

Supply of stationery set for

L/C opening

Charges

Actual stamp charges

4.

Amendment of L/C

plus Tk. 100/-

8.

Certification of Import
Documents for Customer
Assessment Purpose

Charges

Tk. 500 (flat)

9.

Issuance of Shipping
Guarantee

Charges

Nil

10.

Others:
i) For discrepant import L/C
documents (charges to be
realized from beneficiary/bill
forwarding bank)

Charges

i) USD50/- for
foreign bill
ii) USD20/- or
equivalent Taka for
Local Bill.

ii) Charges for communicating

acceptance of usance
L/C(including Back to Back)

Charges

i) Tk.500/- flat for

foreign
ii) Tk.200/- flat for
Local

iii) Issuance of Back to Back

LC Certificate

Charges

Maximum Tk. 500/-

iv) C & F certificate

Charges

Maximum Tk. 500/-

Appendix-B: L/ C opening System

Appendix-C: Few required Documents of L/C