An Internship Report On

Investment Management of Southeast Bank Limited- A Case Study on

Southeast Bank Limited, Bandar Bazar Branch, Sylhet.

Submitted to
The Department of Business Administration
Leading University, Sylhet

Supervised by
Mr. Md. Hafizur Rahman Khan
Lecturer
Department of Business Administration
Leading University, Sylhet

Submitted by
Fahmida Akter
ID-0902010001
22nd Batch
Department of Business Administration
Leading University, Sylhet

Date of Submission
8th June, 2013

LETTER OF SUBMITTAL
June 8, 2013
To,
Mr. Md Hafizur Rahman Khan
Lecturer
Department of Business Administration
Leading University, Sylhet.
Subject: Investment Management of Southeast Bank- A Case Study on Southeast Bank
Limited, Bandar Bazar Branch, Sylhet.

Dear Sir
In connection of my practical orientation to Southeast Bank Limited at Bandar Bazar Branch,
Sylhet. I would like to submit my internship report to you for your perusal. I have prepared
the opportunity to submit the Internship report according to your instructions.
Although the preparation of the study was not an easy task for me, I had enjoyed the
challenge and tried to face the problems with patience. This study gave me a real life
experience and opens my eyes to the actual business environment.
I have provided best effort to prepare this report. I hope my project report will meet your
expectation. However, if you need any clarification from any part of this report then please let
me know about it and I will try my best to make that understandable.
Thanking you in anticipation.
Sincerely Yours,
__________________

Fahmida Akter
ID: 0902010001
22nd Batch
Department of Business Administration
Leading University, Sylhet.

LETTER OF ACCEPTANCE
I am enormously pleased to declare that Fahmida Akter, ID No: 0902010001, a student of
Department of Business Administration, BBA, Leading University, Sylhet, has completed an
internship report on Investment Management of Southeast Bank- A Case Study on
Southeast Bank Ltd, Bandar Bazar Branch, Sylhet under my direct supervision. The
outcome of the report of internship program is an internal part of the prerequisite for the
award of the BBA (Honors) degree that she has performed in the Southeast Bank Ltd,
Bandar Bazar Branch, Sylhet starting from 11 st February 2013 to 15th May 2013. She has
completed her research work with utmost sincerity, commitment and dedication. She has
discussed different issues and problems with me to meet the requirement of research study
and in preparing this report.

She has reviewed all the relevant information and issues of primary and secondary sources. I
rely on the honesty of Fahmida Akter in producing the report and hence recognize the
originality of her research work presented in the report.

I wish her all the best in her effort.

___________________________

Mr. Md Hafizur Rahman Khan

Lecturer,
Department of Business Administration
Leading University, Sylhet

ACKNOWLEDGEMENT

The report titled as Investment Management of Southeast Bank- A Case Study on Southeast
Bank Ltd, Bandar Bazar Branch, Sylhet an Internship Report has been prepared to fulfil the
requirements of BBA program. I am very lucky that I have received utmost and sincere
guidance, supervision and co-operation from various persons while preparing this report.

At first, I would like to thank Mr. Md. Hafizur Rahman Khan, Lecturer, Department of
Business administration, Leading University, Sylhet, for his valuable guidelines, motivation,
and active help in preparing the paper. I am especially indebted to him for providing me such
a wonderful topic of report.

I am expressing my indebtedness to Mr. H. M. Habibur Rahman, HOB of Southeast Bank

Limited Bandar Bazar Branch, Sylhet. I also want to give my thanks to Mr. Mutasim Billah
(Operation Manager) and Mrs. Sharmin Nahar (Senior Officer) of SEBL Bandar Bazar
Branch, Sylhet for their cordial cooperation in providing data and information of the Bank.
My sincerest thanks go to the others who were involved and helped me to prepare this report
as well as Department of Business Administration, Leading University for the support and for
giving me the opportunity to prepare this report as a part of my BBA program.
Some of my friends were also really supporting to me. They gave me motivation when I was
bogged down in pressure. I am grateful to these people.

Executive Summary
The level of investment and the investment climate are inextricably related to each other. The
better the investment climate, the better are the opportunities and incentives to invest for all
the firms of the private sector irrespective of sizes and types.
The topic of the report is Investment Management of Southeast Bank: A Case Study on
Southeast Bank Limited Bandar Bazar branch Sylhet.
Internship program is the pre-requisite for the graduation in BBA. Classroom discussion
alone cannot make a student perfect in handling the real business situation; It was a great
opportunity to work under one of the largest bank of Bangladesh. The purpose of the program
was to perceive the real life situation. The academic knowledge is well enough to compete
with the real world. This internship program was helpful to face the real working
environment; therefore, it is an opportunity for the students to know about the real life
situation through this program. A report has to be built for the university and organization
requirement. The main purpose of the report becomes very clear from the topic of the report.
The report discusses about the different Investment facilities, approval process, monitoring,
performance etc.
This report is broadly categorized in six different parts. At First there is prefatory where I
provides introduction, objective, scope, limitation and methodology. Part two narrates the
company profile including organizational overview of Southeast Bank, their vision, mission
and strategy, products and services, activities and performances. Part three describes the
different aspects of my job at Southeast Bank, Bandar Bazar Branch. Findings and analysis of
the information are in Part four of the report. It includes last five years disbursement,
recovery, substandard, doubtful and bad and loss. Part five includes SWOT Analysis. Major
findings are in Part Six. The last part ends with recommendations and conclusions.

Table of Content
Letter of Submittal
Letter of Acceptence
Certificate of Internship on SEBL
Acknowledgement
Executive Summar
Chapter 01: Introduction.....................................................................01
1.1 Introduction...........01
1.2 Origin of the Study02
1.3 Objective of the Study...02
1.4 Scope of the Study..............03
1.5 Methodology of the Study.........................................03
1.6 Limitations of the Study03
Chapter 02: Organizational Overview of Southeast Bank Ltd.......................04

2.1 Historical Background.........................................................................................05

2.2 Core Values, Core Strengths, & Core Competencies of the SEBL...................06
2.3 Slogan.....................................................................................................................06
2.4 SEBLs Vision........................................................................................................06
2.5 SEBLs Mission..................................................................................................06-07
2.6 SEBLs Commitment to clients.............................................................................07
2.7 Branches of SEBL..................................................................................................07
2.8 Southeast Bank, Bandar Bazar Branch (Islamic Banking)...........................07-08
2.8.1 Service portfolio..............................................................................................08

Chapter 03: Investment Management of Southeast Bank Ltd................09

3.1 Overview..................................................................................................................10
3.2 The Objectives and principles of Investment of Islamic Banking.................10-11

3.3 Modes of Investment under Islamic Banking System..........................................11

3.4 Product List..............................................................................................................11
3.5 Bai-Murabaha..........................................................................................................12
3.5.1 Important Features...........................................................................................12
3.5.2 Steps of Bai-Murabaha.................................................................................12-13
3.6 Bai-Muajjal...............................................................................................................13
3.7 Bai-Salam.................................................................................................................13
3.7.1 Steps of Bai-Salam..........................................................................................14
3.8 Mudaraba................................................................................................................14
3.8.1 Steps of Mudaraba....................................................................................14-15
3.9 Musharaka...............................................................................................................15
3.9.1 Types of Musharaka.......................................................................................15
3.10 Ijarah......................................................................................................................16
3.11 Hire Purchase.........................................................................................................16
3.11.1 Important Features........................................................................................16
3.12 Al-Quard-ul-Hasan................................................................................................17
3.13 Consumer Investment Scheme........................................................................17-18
3.14 Staff House Building Investment..........................................................................18
3.15 Sources of Fund......................................................................................................19
3.16 Investment Policy of Southeast Bank Limited.....................................................19
3.17 Discourage Business Types.....................................................................................19
3.18 Investment Evaluation Principles..........................................................................20
3.19 Determinants for Selection of Borrowers..............................................................20
3.19.1 The Cs of Good and Bad Investment..........................................................20-21
3.19.2 Collection of Investment Information.........................................................22-23
3.20 Documentation of the Loan................................................................................23-24
3.20.1 Objectives of Documentation against loan/advance.........................................24
3.20.2 Steps for Documentation.....................................................................................24
3.20.3 When Documents become Invalid....................................................24-25

3.21 Security Against Advances..........................................................................25

3.21.1 Types of securities..................................................................................25
3.21.2 Attributes of a Good Security...............................................................26
3.22 Methods of Creating Charges................................................................26-28
3.23 Investment Assessment & Risk Grading...................................................28
3.23.1 Investment Assessment....................................................................28-29
3.23.2 Risk Management-Lending Decision..................................................29
3.23.3 Basics of Investment Risk................................................................29-30
3.23.4 Investment Risk Grading.................................................................30-32
3.24 Organizational Structure of Investment Management..........................32-33
3.25 Approval Process....................................................................................33-34
3.25.1 Time Requirement..............................................................................35
3.26 Disbursement Process..................................................................................35
3.27 Procedure for Investment Sanction...........................................................36
3.28 Investment Monitoring..........................................................................36-37
3.29 Recovery and Follow Up of Non Performing Investment and
Advances......................................................................................................37
3.29.1 Recovery procedure of Southeast Bank.................................37-38
3.29.2 Renewal and Status Verification...................................................38
3.29.3 Write Off of Loans/ Advances.......................................................38

Chapter 04: Trend Analysis of SEBL..............................................39

4.1 Analysis of Investment & advances of Bandar Bazar Branch,
Southeast Bank...................................................................................................40
4.1.1 Amount of Total Investment and Advances at Bandar Bazar Branch,
SEBL................................................................................................................40-41
4.1.2 Various Types of Investment and Advances at SEBL,
Bandar Bazar Branch......................................................................................41-42
4.1.3 Amount of Short Term, Mid Term & Long Term Investment..............43

4.1.4 Percentage of Short Term, Mid Term, & Long Term Investment at
SEBL, Bandar Bazar Branch.......................................................................44
4.1.5 Area of Disbursement at Bandar Bazar Branch, SEBL....................45
4.1.6 Provisioning..........................................................................................46
4.1.7 Classified Loans of Bandar Bazar Branch, SEBL............................47
4.1.8 Recovery of Investment at Bandar Bazar Branch, SEBL................48
4.1.9 Amount of Profit at Bandar Bazar Branch, SEBL............................49

Chapter 05: SWOT Analysis........................................................................50

5.1 SWOT Analysis of Southeast Bank Ltd, Bandar Bazar Branch........51-53

Chapter 06: Major Findings.......................................................54

6.1 Findings of the Study...........................................................................55-56
6.2 Problems of SEBL, Bandar Bazar Branch............................................57

Chapter 07: Recommendation & Conclusion..................................58

7.1 Recommendation....................................................................................59
7.2 Conclusion...............................................................................................60
References.....................................................................................................61
Charts:
Chapter 03: 3.25 Flow Chart of Approval Process..33
Chapter 03: 3.27 Procedure for Investment Sanction.................................35
Graphs:
Chapter 04:
4.1.1Amount of Total Investment and Advances at Bandar Bazar Branch,
SEBL.40-41
4.1.2 Various Types of Investment and Advances at SEBL,
Bandar Bazar Branch......................................................................................41-42
4.1.3 Amount of Short Term, Mid Term & Long Term Investment..............43
4.1.4 Percentage of Short Term, Mid Term, & Long Term Investment at

SEBL, Bandar Bazar Branch.......................................................................44

4.1.5 Area of Disbursement at Bandar Bazar Branch, SEBL....................45
4.1.6 Provisioning..........................................................................................46
4.1.7 Classified Loans of Bandar Bazar Branch, SEBL............................47
4.1.8 Recovery of Investment at Bandar Bazar Branch, SEBL................48
4.1.9 Amount of Profit at Bandar Bazar Branch, SEBL............................49