G Bank-Ok

General Banking----------------------------------------------------------------------BASIC Bank Ltd.
General banking is the starting point of all the banking operations. It is the
department, which provides day-to-day services to the customers Main Functions of
general banking department are the followings:
1. ccounts !pening "ection
#. ccounts "ection.
$. %ocal &emittance "ection
'. (ollection nd (learing
). (ash "ection
*. F+& and ncillary "ervices "ection
1.0: ACCOUNTS OPENING SECTION
1.1 ACCEPTING DEPOSIT:
,ank is a financial intermediary, which mobili-es fund from surplus unit and allocates it
to deficit unit. "urplus unit means the people who have surplus money and willingness
to save. +eficit unit means the people who need money for industry, trade, business,
or for personal use but don.t have sufficient money of their own for such purposes.
,ank mobili-es the fund by accepting deposits from depositors and allocates the fund
by providing loan to borrower.
,anker-customer relationship begins with the opening of an account by the customer.
!pening of an account binds the same into a contractual relationship. ,ut the selection
of customer is very crucial. In fact, fraud and forgery of all kinds start by opening of an
account by the customer /s0. "o, the bank takes e1tra care in its selection. !ne of the
basic functions of commercial banks is to accept deposits. For accepting deposits both
demand and time, ,"I( ,ank +234 branch offers the following types of accounts-
1.2 TYPES OF ACCOUNTS WITH TERMS AND CONDITIONS
5his part covers only following types of accounts-
1. "avings ,ank ccount
#. (urrent ccount
$. "hort 5erm +eposit /"5+0 ccount
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1.2.1 Savings Ban A!!"#n$
5his deposit is primarily for small-scale savers. 6ence, there is a restriction on
withdrawals in a week. 6eavy withdrawals are permitted only against prior notice.
"ome Important 3oints are as follows-
G%n%&a' C(a&a!$%&is$i!s :
s per ,, instruction 789 of ", deposits are treated as time liability and 189 of it as
demand liability
a. Minimum opening deposit of 5k.)888:; is re<uired=
b. Interest is paid on this account. ,"I( offers a reasonable rate of interest for
", :(.
c. >enerally, banks re<uire a ?-day prior notice if the total amount of one or more
withdrawals on any date e1ceeds #)9 of the balance of the account unless is
given.
d. 5he number of withdrawals over period of time is limited. !nly two withdrawals
are permitted per week. If there are more than two withdrawals are made in a
week, no interest will be paid on rest amount for that month.
e. >enerally householders, individuals and other small-scale savers are the
clients of this account
f. Minimum ,alance of 5k.#888 is to be maintained.
g. Interest will be counted on the minimum balance from the date 1-* of a month
h. @o service charge as it is an interest bearing account.
i. (heck book issuing balance is also the same /5k. 1888:;0=
A. Interest rate is ?.)9 including 189 e1cise duty on interest rate. Interest paid
twice in a year depending on monthly minimum balance. Bhen money is
deposited within ) of the following month, then it is counted as monthly
minimum balance. If the interest amount is more than 5k. #88 or more, the
bank is paid the amount to the customer. !therwise it is treated as ,ank.s
"hadow 3rofit=
k. (an open the :c individually or Aointly. In case of Aoint a:c, Coint signature is
re<uired if not authori-ed otherwise=
l. Minor /For withdrawal purpose0, lunatic, insolvent, pardanshin women /@ot
mandatory0 can not open such type of account.
45
1.2.2 C#&&%n$ A!!"#n$
(urrent account is purely a demand deposit account. 5here is no restriction on
withdrawing money from the account. It is basically Austified when funds are to be
collected and money is to be paid at fre<uent interval. It is most suitable for private
individuals, traders, merchants, importers and e1porters, mill and factory owners,
limited company.s etc. "ome Important (haracteristics are as follows-
a. minimum balance of 5D.)888 has to be maintained.
b. (+ accounts are unproductive in nature as banks loanable fund is concerned.
"ufficient fund has to be kept in li<uid form, as current deposits are demand
liability.
c. 5hus huge portion of this fund become non-performing. For this reason banks
do not pay any interest to (+ ccountholders.
d. 5here is no restriction on the number and the amount of withdrawals from a
current account.
e. "ervice charge and incidental charges are recovered from the depositors since
the bank make payments and collect the bills, drafts, che<ues, for any number
of times daily.
f. ,usinessmen and companies are the main customers of this product.
g. 5he ,anks through current accounts grant the loans and advances
1.2.) STD *S("&$ T%&+ D%,"si$- A!!"#n$
@ormally various big companies, organi-ations, >overnment +epartments keep
money in "5+ account. Fre<uent withdrawal is discouraged and re<uires prior notice.
In ,"I(, customers usually give an instruction that their current account will be
debited whenever its deposited amount crosses a certain limit and this amount will be
transferred to the "5+ account. 5he deposit should be kept for at least seven days to
get interest. 5he interest offered for "5+ is less than that of savings deposit. Interest is
calculated based on daily minimum product and paid two times in a year. Interest rate
is ).?)9 including 189 e1cise duty on interest rate.

1.2 COMMON FORMA.ITIES RE/UIRED FOR E0ERY ACCOUNT
+uly filled up ccount !pening Form.
Introducer.s signature on ccount !pening Form to be verified by Manager
under full signature.
5wo copies of passport si-e photograph of account opener/s0 duly attested
by the introducer.
45
N"$%: Man1a$% "& a#$("&i$2 3"&+ filled up by an individual /s0 or account openers are
to be obtained if the customer wants to authori-e another person to operate an
account on behalf of him: them.
1.) DOCUMENTS RE/UIRED FOR EACH ACCOUNT SEPARATE.Y
In !as% "3 P&",&i%$"&s(i, Fi&+4
+eclaration of proprietorship.
5rade licence.
5a1 Identification @o /5I@0 directed by ,angladesh ,ank.
In !as% "3 Pa&$n%&s(i, Fi&+4
ccount must be opened in the name of the firm.
5he firm should describe the names and addresses of all partners.
,oard &esolution signed by all partners to open the :(.
3hotocopy of partnership deed duly attested by notary public.
%etter of partnership duly signed by all partners.
5rade licence from municipality.
In !as% "3 P&iva$% .i+i$%1 5"in S$"! C"+,an24
Memorandum of ssociation and rticles of ssociation duly certified by
(hairman or "ecretary.
,oard &esolution duly certified by (hairman: "ecretary authori-ing to open
the :( with the bank and mentioning the name of the person /s0 who will
operate the :( as per provisions of rticles of ssociation.
(ertificate of incorporation duly certified by (hairman or "ecretary.
%ist of all +irectors with +esignation, ddress E "pecimen "ignature duly
certified by (hairman or "ecretary /Form FII0.
%atest copy of ,alance "heet
3ower of attorney.
45
In !as% "3 P#6'i! .i+i$%1 5"in S$"! C"+,an24
3hotocopy of &egistration certificate certified by (hairman or "ecretary.
Memorandum of ssociation and rticles of ssociation duly certified by
(hairman or "ecretary.
,oard &esolution duly certified by (hairman: "ecretary authori-ing to open
the :( with the bank and mentioning the name of the person /s0 who will
operate the :( as per provisions of rticles of ssociation.
(ertificate of commencement duly certified by (hairman or "ecretary.
%ist of members of Managing: 21ecutive duly certified by (hairman or
"ecretary.
In !as% "3 S"!i%$i%s7C'#6s4
(ertified copy of &egistration certificate under the societies &egistration ct,
17*#.
(ertified copy of &esolution for opening and operation of account.
(ertified copy of ,ye-laws E &egulations: (onstitution.
3ower of ttorney.

In !as% "3 C"",%&a$iv% S"!i%$2-
(opy of ,ye-law duly certified by the (o-operative officer.
Gp to date list of office bearers.
&esolution of e1ecutive (ommittee as regards of the account.
(ertified copy of (ertificate of &egistration issued by &egistrar, (o-operative
"ocieties.
In !as% "3 N"n4G"v%&n+%n$ C"''%g%7 S!(""'7 Ma1&as(a, -
Gp to date list of the >overning ,ody: Managing (ommittee.
(opy of &esolution of the >overning ,ody:Managing (ommittee authori-ing
opening and operation of the account duly certified by >a-etted !fficer.

In !as% "3 Min"&8s a!!"#n$4
3utting the word H MI@!&I after the title of the account.
&ecording special instruction of operation of the account.
45
5he account opening form is to be filled in and signed by either of the
parents or the legal guardian appointed by the (ourt of %aw E not by the
Minor.
A!!"#n$ O,%ning P&"!%ss.
ccount is opened according to the following steps respectively:
1. +uly filled-up prescribed pplication Form by the pplicant with introductory
reference by an account holder.
#. +uly fill up the specimen signature card in front of a concerned person by the
applicant.
$. Jerify the introductory reference and e1amine the documents by the authori-ed
person.
'. Issue the deposit slip and make deposit in cash. @o che<ue or draft is
acceptable.
). Issue one che<ue book E a pay- in-slip book.
*. ccount is opened.
1.9 ISSUING CHE/UE BOO:
F"& N%; an1 O'1 A!!"#n$
Fresh checkbook is issued to the account holder only against re<uisition on the
prescribed application form. In case of old account, re<uisition made on the
prescribed re<uisition slip attached with the checkbook issued earlier. >enerate a
security no randomly for every check leaf by Manager or authori-ed person.
3repare the instrument with respective security no on the back of each leaf and
signed by the authori-ed person. Make necessary entries in C(%! Iss#%
R%gis$%&. Finally issue the checkbook for client /s0.
Iss#% "3 D#,'i!a$% !(%! 6""
+uplicate checkbook in lieu of lost one should be issued only when an :( holder
personally approaches the ,ank with an application %etter of Indemnity in the
prescribed 3roforma agreeing to indemnify the ,ank for the lost checkbook. Fresh
check ,ook in lieu of lost one should be issued after verification of the signature of
the ccount holder from the "pecimen signature card and on reali-ation of
45
re<uired 21cise duty only with prior approval of manager of the branch. (heck
series number of the new checkbook should be recorded in ledger card signature
card as usual. "eries number of lost checkbook should be recorded in the stop
payment register and caution should be e1ercised to guard against fraudulent
payment.
1.< ACCOUNT EN/UIRY
customer can obtain the statement of his :( by submission of an application in
prescribed balance en<uiry receipt. @ormally it is supplied two times in a year. In
addition, customer can know his current deposit position informally.
1.= TRANSFER OF AN ACCOUNT
ccount holder may transfer his account from one branch to another. For this, he:she
must apply with proper reason to the manager of the branch where he is maintaining
account. Manager then re<uests to the manager of that branch where the :( holder
wants to transfer his account. ,esides, he also sends original copy of account opening
form and ""( /"pecimen "ignature (ard0 and photocopy of application for
transferring the account with the balance remained in the account.
1. > C.OSI NG OF AN ACCOUNT
n account may close-
1. Bhen the customer desirous to close the account.
2. Bhen the account is inoperative for a long time.
3. In case of customer.s death, insanity or insolvency.
4. Bhen the court on that particular :( issues >arnishee !rder.
5o close an account, the checkbook is to be returned to the bank. ,"I( bank
charges 5k. #88:; for the same by debiting the amount from his account and rest
amount is then paid to the customer. @ecessary entries are given to the account
closing register and computer. Finally make sure that :( holder is completely free
from all dues.
Ta6'%49.1: E?!is% D#$i%s A,,'i!a6'%: F"& A'' :in1s "3 D%,"si$s
S'. N".
D%,"si$ A+"#n$ .i+i$ C(a&g%
1.
Gp to 18,888 4ero
#.
18,881 to 1,88,888 5k. 1#8
$.
1,88,881 to 18,88,888 5k. #)8
'.
18,88,881 to 1,88,88,888 5k. )88
).
1,88,88,881 to ),88,88,888 5k. #)88
45
*.
),88,88,881 and above 5k. )888
Source: SRO no.137-Aine/96/248-excise, date 28-7-96, NR
2.0: ACCOUNTS SECTION
ccounts department maintains all records of transactions and all types of statement.
t the end of transaction hour all concerned section sends vouchers of transactions to
this department. ccounts department compares all figures: amount, contents of
transactions with supplementary statement prepared by computer. If any discrepancy
arises regarding any transaction then this department reports to the concerned
department. Following are the activities of accounts department:
5o record all transaction in the cash book.
5o prepare daily, weekly, monthly, half-yearly and yearly fund position.
5o prepare all kinds of statements related to ,angladesh ,ank, 6ead office
and @ational ,oard of &evenue /@,&0.
5o prepare monthly salary statement, provident fund statement and
administrative e1penditure statement.
5o make charges for different types of duty.
5able-'.): "howing different types statements prepared by the ,ranch
Bang'a1%s( Ban R%'a$%1 S$a$%+%n$s
Beekly fund position /(&&-'9 and "%&-1*90
Monthly sector corporation
Monthly "chedule ,ank "tatements-1 /","-10
Kuarterly "chedule ,ank "tatements-# /","-#0
Kuarterly statement of e1change of torn: dirty notes
6alf-yearly "chedule ,ank "tatements-$ /","-$0
6alf-yearly deposit insurance pension scheme
H%a1 O33i!% R%'a$%1 S$a$%+%n$s
+aily reconciliation statement
Beekly E monthly statement of affairs with income, e1penditure E subsidiaries
Monthly comparative statement
6alf-yearly statement of privilege creditors
6alf-yearly detailed statement of sundry debtors
6alf-yearly E yearly statement of sundry creditors
6alf-yearly statement of other assets
6alf-yearly statement of suspense :(
"i1 column basis data sheet /deposit, loans, gross income E e1p., net profit: loss0
).0: .OCA. REMITTANCE SECTION
(ash remitting from one place to another is risky. "o, ,anks remit funds on behalf of
the customer /s0 to save them from any awkward happening through network of their
branches. 5here are three modes of remitting funds. 5hese areL
45
3ay !rder /3!0
+emand draft /++0
5elegraphic 5ransfer /550
(all +eposit &eceipt /(+&0.
).1 PAY ORDER *PO-
3ay order is an instrument, used to remit fund within a clearing -one. Gnlike che<ue,
there is no possibility of dishonoring 3!. 5he 3! can only be encashed through the
branch that has issued the instrument.
Pa2 O&1%& Iss#ing P&"!%ss
For issuing a 3!, following formalities are to be maintained. 5hese are-
+uly filled up the application form by the customer.
+eposit money either in cash or by che<ue with necessary charges.
3repare the instrument and make necessary entries in the ,ills 3ayable
&egister where payee.s name, date, 3! no. etc are noted.
+eliver the instrument to the customer after scrutini-ed and approved by
authority by taking signature of the customer on the counterpart.
PO W"&ing P&"!%1#&%@ S(";s in a F'"; C(a&$
M"1% "3 Pa2 O&1%& P#&!(asing:
,y cash 5eller (ash :( ---------------------------------+r
45
3urchaser has an account with
,"I( and fills up the relevant
form with a credit voucher
3urchase the 3! in favor of a
person or company
+eposit the 3! in his account
with ,"I( or another ,ank
by the beneficiary
5he collecting ,anker presents the 3! to
paying ,anker through clearing house
(ollecting ,ank
sends an I,+
3ayee.s account credited
with collecting ,anker
3ayee.s account credited with collecting ,anker
If any :( with ,"I(
If deposited to another bank
,ills 3ayable /3.!0 :( .....................................(r.
Income :( (ommission on &emittance ..........(r.
,y account
(lient.s :( ...................................................... +r.
,ills 3ayable /3.!0 :( .....................................(r.
,y transfer
6ead office M other department.s client M( ........+r.
,ills 3ayable /3.!0 :( .....................................(r.
A!!"#n$ing En$&2 3"& Pa2 O&1%&
+rawer.s:Issuer.s :( ----------------------------+ebit
,ills 3ayable /3!0 :(----------------------------------(redit
Income :( (ommission----------------- --------------(redit
Income :( 3ostage--------------------------------------(redit.
3ayment order is a current liability on the part of bank, which is re<uired to be
discharged by the beneficiaries against payment in cash or through an account.
Pa2+%n$ "3 Pa2 "&1%&
s the 3! issued by the bank is crossed one it is not paid over the counter. !n the
contrary, this amount is transferred to the payees. account. 5o transfer the amount the
payee must duly stamp the 3!. 5he a:c treatments will be-
,ills 3ayable :(----------------------+ebit
6! :( NO. branch--------------------------(redit.
N"$%: ,efore payment is made, it is duty for issuing bank to e1amine whether
endorsement was given by the collecting bank or not. If not, dishonor the instrument
and marking the instrument N2ndorsement &e<uirement..

Can!%''a$i"n "3 PO
5he following procedure is followed to refund the pay order by cancellation:
45
5he 3ayee deposits it to his
(ollecting ,anker
(ollecting ,ank sends the 3.!. to the issuing
,ank through clearing house arrangement
5he 3ay !rder is passed and
cancelled in the deposit section
3ayment is given and is registered in
Incoming 3! 3ayment &egister.
1. "ubmit written re<uest to refund the pay order attaching therewith the
original 3!.
#. Jerify purchaser.s signature with the original application form on record.
$. Manager: authori-ed person.s prior permission is re<uired before
refunding the amount of pay order.
'. 3ay order should be affi1ed with a stamp Ncancelled. under proper
authentication and the authori-ed officer.s signature on the pay order.
). @o charge is created for cancellation. &efund only the pay order amount.
*. 5he original entries are to be reversed with proper narration.
?. &ecord the cancelled pay order in the 3ay !rder Issue &egister.
."ss "3 Pa2 O&1%&
If the instrument is lost, the holder is asked to fulfill the following re<uirements-
a0 6older should inform the bank immediately.
b0 &ecord a >+ />eneral +iary0 in the nearest 3olice "tation.
c0 Furnish an Indemnity ,ond.
!n fulfilling the above re<uirements, ,"I( bank is then issued a duplicate pay order
and marked NIn lieu of.. ,anker will also mark Nstop payment. on the ,ills 3ayable
&egister.
C"''%!$i"n "3 Pa2 O&1%&
If the payee is a customer of +haka 234 branch, he will deposit it for collection. 5hen
the branch gives necessary endorsement as a collecting bank. 5hen the instrument
places the issuing bank through clearing house.
PO C(a&g%
commission of 5D.)8:; is charged for a pay order.
).2 DEMAND DRAFT *DD-
++ is called N,anker.s +raft.. It is an instrument, issued by a particular branch, drawn
on another branch of the same bank, instructing to pay a certain sum of money. It is
very popular instrument for remitting fund from one corner of a country to another. ++
is issued in favour of a customer who maintains an a:c with ,"I( +haka 234 branch.
It can be issued against (ash or (he<ue. If ++ amount is more than 5k.)8888:;, a
test code is given on I,(. 5he a:c treatments will be-
Bhen ++ is issued:
(ash:(ustomer :(PPPPPPPP+ebit
45
6:! :( NF. branchPPPPPPPPPP(redit
Income :c commissionPPPPPP..PP(redit.
fter giving these entries an Inter ,ank (redit dvice /I,(0 is prepared which
contains the controlling number, depicted that the branch is credited to whom it is
issued. n I,( implies the following entries-
6:! :( issuing branchPPPPPP..P+ebit
+rawn on branchPPPPPPPPPPP(redit.
DD W"&ing P&"!%1#&%: S(";s in a F'"; C(a&$
Pa2+%n$ P&"!%ss "3 DD
fter receiving the instrument, the I,( lodgment is done by the branch. @ecessary
entries are given in ++ Inward &egister. (ontrolling number of the I,( should match
with the serial number of this register. 5he following accounting entries are made in
following cases-
Bhen I,( comes
6:! :( Issuing branchPPPPPPPPP+r
++ 3ayable :( PPPPPPPP..PPP.(r

Bhen instrument comes
++ payable :(.PPPPPPPPPPP...+r
(ustomer.s :(..PPPPPPPPPPPP(r
If advice does not come but instrument comes
"uspense :(PPPPPPPPPPPPP.+r
45
pplicant has an :(
with ,"I( bank
6e fills up the relevant
for the ,ank
++ is handed over the
customer where paying
,ank is mentioned and
payment will be made
from another ,ank
n I,( along with
photocopy of ++ is sent
to the paying ,ank.
If ++ comes to the ,ank on which it
is drawn, the ,ank honors it.
3arty :(PPPPPPPPPPPPPPP(r
Bhen advice comes
6! :( Issuing ,ranch PPPPPPPPP.+r
"uspense :(PPPPPPPPPPPPP..(r
5he banker even on receiving instructions from the remitter cannot stop the payment
of the instrument. "top payment can be done in the following cases-
i) ."ss "3 1&a3$ 6%3"&% %n1"&s%+%n$: In this case, H+raft reported to be
lost, payee.s endorsement re<uires verificationI is marked.
ii) ."ss "3 1&a3$ a3$%& %n1"&s%+%n$: In this case, the branch first satisfies
itself about the claimant and the endorsement in his favor.
Can!%''a$i"n "3 DD
5o cancel an issued ++, the client has to submit an application. Issuing branch then
sends an Inter ,ranch +ebit dvice /I,+.0 to the drawn branch against previously
issued Inter ,ranch (redit dvice /I,(0. fter that the following entries are given-
6:! :( drawn on branch-------------------------+r.
(lient.s :( -------------------------------------------(r.
Iss#ing "3 D#,'i!a$% DD
If the customer wants a duplicate ++, he then is asked to do the following formalities-
1. 5hrowing an application immediately by the original ++ holder.
#. Making a >eneral +iary />+0 in the nearest 3olice "tation.
$. Furnishing an Indemnity ,ond.
'. 3ut a N(G5I!@. mark in the register.
). Inform to the 6ead !ffice by the issuing branch.
*. Inform all the branches by the 6! for stop payment.
?. Issue a new ++ /3ut the same ++ no. and mark +G3%I(520.
DD C(a&g%
(ommission Q 8.1)9 but minimum 5k.)8:;.
3ostage charge 5k. #):; /Fi1ed0.
++ cancellation charge 5k. )8:; /Fi1ed0.
).) TE.EGRAPHIC TRANSFER *TT-
45
"ometimes the remitter of the funds re<uires fund immediately. In that case, the
banker is re<uested to remit the funds telegraphically. +ifferent modes are 5elegram,
5elephone, 5ele1, Fa1. 5elegraphic 5ransfer is the most rapid and convenient but
e1pensive method. 5he drawer and the payee should have accounts with ,"I( bank.
55 is issued against cash, che<ue, and letter of instruction.
F'"; C(a&$ S(";s H"; TT W"&s *O#$;a&1-
P&"!%1#&% 3"& Iss#ing TT
Following procedure is followed for issuing a 55.
a0 +eposit money by the customer along with application form.
b0 In receipt of money a cost memo is given to the customer containing 55
serial number which informs the awaiting party of the paying branch by
the customer.
c0 5ested tele1 message is prepared where 55 serial number, notifying
party.s name is mentioned.
d0 5he tele1 department confirms transmission of the message.
e0 @ecessary entry is given to the N55 !utgoing &egister.. 2ntries are as
follows-
45
pplicant has an
account with ,"I(
pplicant fills up the relevant
/Income :(0 for the ,ank.
5e1t of tele1 is written or
the relevant information
along with
5est code is sent to the
payee ,ank through fa1
or telephone.
nother # copies of the
te1t is sent through
courier to the 3ayee.s
,ank.
!ne copy from drawer.s ,ank and another
from 3ayee.s ,ank are sent to the
reconciliation department of 6!
,efore that the 3ayee.s ,ank decode
the test and if test is agreed
5he reconciliation department reconciles
two copies and detects the fraud or forgery
if any
3ayee.s account credited
(ash:&espective :( /Issuer0PPP+r
6! :( 3aying branchP P(r /3rincipal amount0
Income :( /(ommission0PP P(r

P&"!%1#&% 3"& in!"+ing TT:
fter receiving the tele1, it is authenticated by tested. 55 serial number is verified with
the N55 Incoming- (oncern branch. &egister. Joucher is released in this regard giving
the following accounting entries-
6! :( 3aying branch------------------------------+r
(ustomer :(----------------------------------------(r.
TT C(a&g%
(ommission Q 8.189 of the 3rincipal mount but minimum 5k.1)8:;.
5ele1 charge 5k. )8:; /Fi1ed0.
J5 1)9 of (ommission.
).9 CA.. DEPOST RECEIPT *CDR-
(all +eposit &eceipt /(+&0 is also an instrument, issued by a particular branch, drawn
on another branch of the same bank, instructing to pay a certain sum of money not
over the counter to a certain person or his order. It is as like as 3ay !rder /3!0, but
main difference is that 3! is treated as bills payable and (+& is treated as sundry
deposit. From banker.s point of view, it is always desirable but its practice is limited.
!nly 5k. )8:; /Fi1ed0 is charged for this facility. If (+& amount is more than
5k.)8888:;, a test code is given on I,(.
Bhen issuing the instrument, accounting treatment will be-
3arty :(-----------------------------+ebit
6! :( drawn on branch----------------(redit.
fter receiving the instrument, accounting treatment will be-
6! :( Issuing branch--------------+ebit.
3arty :(------------------------------------(redit.
,esides, "taff and very Jalued (ustomer.s of the bank enAoy +irect Fund 5ransfer
facility. In this case, no commission is charged.
45
9.0: CO..ECTION AND C.EARING SECTION
(ustomers do pay and receives bill from their counter party as a result of transaction.
,"I( ,ank %imited collects the bills on behalf of their customers. (ollection
mechanisms in ,"I( ,ank are clearing, !utward ,ill For (ollection, Inward ,ills for
(ollection.
).9.1 C.EARING
Bhen the bill is within the range of the clearinghouse it is sent for collection through
clearing section. s far as safety is concerned customers get crossed che<ue for the
transaction (rossed check can.t be encashed from the counter= rather it has to be
collected through banking channel i.e., clearing. If a client of ,"I( ,ank received a
check of another bank which is located within the clearing range and deposit the
instrument in his account at ,"I( ,ank. 5hen ,"I( ,ank will collect the money
through clearing house. fter received the check ,"I( ,ank will credit client account.
6owever, the amount is credited in the customer a:c but he will not get the money until
the check is honored.
P&"!%1#&%s 3"& !"''%!$i"n:
a. &eceivedI seal is stamped on the che<ue
b. (rossing of the che<ues are done
c. H3ayee.s :( (reditedI endorsement is given
d. 2ntries are given in the !utward (learing &egister
e. (learingI seal is given
f. (he<ues are sorted bank wise and entries are given to the computer
/@ID"6#0
g. 2ntries are given in the (learing 6ouse &egister before dispatching to the
clearing house.
A3$%& $(a$@ a 1%6i$ v"#!(%& is ,&%,a&%1:
,alance with ,angladesh ,ank ------------------------------+r.
ll (ustomer.s :( ----------------------------------------------------(r.
F#n!$i"n in $(% C'%a&ing H"#s%:
45
a. 5he clearinghouse is an assembly of the locally operating scheduled banks for
e1change of checks, drafts, and other demand instruments drawn on each
other and received from their respective customers for collection.
b. 5he house meets at the appointed hour on all working days under the
chairmanship of the central bank. 5he clearinghouse sits twice in a working
day.
c. 5he members submit the claimable checks in the respective desks of the banks
and vice-versa.
d. (onse<uently, the debit and credit entries are given.
e. t the end, the debit summation and the credit summation are calculated. 5hen
the banks clear the balances through the check of ,angladesh ,ank.
f. 5he dishonored checks are sorted and returned with return memo.
g. 5he dishonored instruments for principal branch are given following treatment:
(ustomer :( ---------------------------------------------------------------+r.
,alance with ,angladesh ,ank ----------------------------------------(r.
h. If the instruments are dishonored then they are sorted again and sent back to
the returning house along with their return memo.
i. %ater on all the instruments of ,"I( ,ank %imited which were claimed by
other banks are sorted and delivered to respective branches.
A. If the instruments are honored the treatment is:
(ustomer :( --------------------------------------------------------------------+r.
,alance with ,.,. ----------------------------------------------------------------(r.
Ins$&#+%n$s "3 "$(%& 6&an!(%s
6owever, the principal branch clears its checks as well as the checks of other
branches. ,ecause, no other branch is allowed to represent directly. 5he other
branches send the instruments along with I,+. 3rincipal ,ranch acts as an agent in
this case.
A!!"#n$ing $&%a$+%n$ 3"& !"n!%&n%1 6&an!(:
6! :(-3rincipal ,ranch -------------------------------------------------------+r.
(ustomer :( ---------------------------------------------------------------------(r.
i3 $(% ins$&#+%n$ is ("n"&%1@ 3rincipal ,ranch gives the following treatment ,alance
with ,.,. ----------------------------------------------------------------+r.
6! :(-concerned branch ---------------------------------------------(r.
45
I3 $(% ins$&#+%n$ is 1is("n"&%1@ the instrument is returned to the concerned branch
through I,+. 5he treatment is:
6! :( concerned branch ----------------------------------------------------+r.
,alance with ,.,. --------------------------------------------------------------(r.
Dis("n"& "3 C(%A#%:
If the che<ue is dishonored, ,"I( ,ank %imited sends a memorandum /che<ue
return memo0 to the customer stating the reason. If the che<ue is dishonored due to
insufficiency of funds, ,"I( ,ank %imited charges 5D.)8:; as penalty.
).9.2 OUTWARD BI..S FOR CO..ECTION *OBC-:
If the bill is beyond the clearing range then it is collected by !,( mechanism
(ustomer deposit che<ue, drafts etc. for collection, attaching with their deposit sleep,
Instrument within the range of clearing are collected through local clearing house, but
the other which are outside the clearing range are collected through !,( mechanism.
customer of ,"I( ,ank %imited of +haka 234 branch of +haka is depositing a
che<ue, of "onali ,ank (o1.s ,a-ar. @ow as a collecting bank ,"I( +haka 234
,ranch will perform the following task=
P&"!%1#&%:
a. +epositing the che<ue along with deposit-slip
b. (rossing of the che<ues are done indicating 3rincipal ,ranch as collecting
bank
c. 2ndorsement H3ayee.s :( will be (redited on reali-ationI is given
d. 2ntries are given in the !utward (learing &egister
(ollecting bank can collect it either by its branch or by the drawer.s bank. 5hey will
forward the bill then to that particular branch. !,( number will be given on the
forwarding letter. @ow following procedures will take place in case of the following two
cases.
Bi''s !"''%!$%1 $(&"#g( B&an!(:
45
If the bill is forwarded to branch they will collect it through I,( procedure. (ollecting
branch will receive an I.,.(.. from that particular agent branch. ccounting treatment
from the angle of collecting branch will be=
6.!. :( concerned branch ........................ +r.
(ustomer :( ............................................ (r.
Income :( commission= 3ostage .............. (r.
In this case commission will be charged by the collecting branch, not the agent branch
and the drawer.s bank will send a ++ to the collecting branch. 6ere both the banks will
charge for collection from the customer. It should be scrutini-ed that +.+. is containing
the !,( number.
A!!"#n$ing $&%a$+%n$ 3"& $(% !"''%!$ing 6&an!( ;i'' 6%:
(learing ......BBBBBBBBBBBBBBBBBBBB........ +r.
(ustomer ..................BBBBBBBBBBBBBBBBBB.. (r.
/++ will be sent for collection through clearing0.
(ustomer :( ........................BBBBBBBBBBBBBBBB.... +r.
Income :( (ommission ......BBBBBBBBBBBBBBBBB. (r.
3ostage ................................BBBBBBBBBBBBBBBBB.... (r.
/8.1)9 commission of the instrument value and 5k. 1):- as postage charge in
deducted.0
Ba'an!% S(%%$ %33%!$
!,( create asset and liabilities simultaneously for bank. Bhen send for collection, it is
bank.s liability and as well as customers liability i.e. banks asset.
%iability head ,ills for collection being bills receivable as per contra
sset head ,ills receivable being bills for collection as per contra.
(ustomers liability :( BBBBBBBBBB..................... +r.
,ankers liability :(.................................................................. (r.
fter reali-ation /even if dishonored0
,anker.s liability :( ....BBBBBBBBBBBBBBBB............... +r.
(ustomer liabilities :( ............BBBBBBBBBBBBBBBB... (r.
fter reali-ation the contra is settled. 5his item is a stock variable of balance sheet at a
particular date.
Ba'an!ing
45
,alancing is done on the bankers liability account. 5he year end balance is shown on
balance sheet.
).9.) INWARD BI..S FOR CO..ECTION *IBC-:
Bhen the bank collects bills, as an agent of the collecting branch the system is known
as I,(. In this case the bank will work as an agent of the collection bank. 5he branch
receives a forwarding letter and the bill. @e1t steps are:
a. 2ntry in the I,( register, a I,( number given
b. 2ndorsement given- H!ur branch endorsement confirmedI
c. 5he instrument is sent to clearing for collection.
(learing ..................................................................................... +r.
Miscellaneous (reditor :( !,( ................................................ (r.
I3 ("n"&%1
If the instrument is honored the accounting treatment will be=
Miscellaneous (reditor :( !,( ........................... +r.
6.!. (ollecting branch :( .................................... (r.
An IBCA is 1is,a$!(%1 in $(is &%ga&1
6! :( agent branch ...................................................... +r.
6! :( collection branch ................................................ (r.
I3 1is("n"&%1
In this case the instrument is returned to the collecting branch along with a return
memo.
).9.9 DOMESTIC BI.. PURCHASED *DBP- :
,ank has to serve its customer by any means. ,ut some customers are valued as far
as deposit is concerned. "o banks give them some benefits depending on the
situation. (lients get bill which is as per agreement collected by the bank. 5his
collection procedure takes usually #-$ days. ,ut in many cases valued clients need
money urgently. In this situation bank purchase the bill of the client paying him money
then the then. %ater on bank collects the bill and adAust accordingly.
A!!"#n$ing T&%a$+%n$
+omestic bill purchase :( ..BBBBBBBBB............................. +r.
(ustomer :( ..............................................BBBBBBBBB... (r.
Bhen collected by any instrument or any branch
45
6! :( concerned branch:clearing :( ........................ +r.
+omestic bill purchase :( ............................................ (r.
5his is kind of credit which is offered to the valued clients only. 6owever no credit line
facility is needed for them. (ommission is charged from them at a higher rate which is
e<uivalent to lending rate of 1'-1)9 for the collection period only.
<.0: CASH SECTION
(ash is the lifeblood of all financial activities. (ash section is a very sensitive point of
the branch. 5his section deals with all types of negotiable instruments and it includes
vault, used as the store of cash, instruments. 5he vault is insured up to 5k.#8 lac.
Insured amount yet to be enhanced to 5k. '8 lac. !peration of this section begins
when the banking hour starts. (ash officer begins his:her transaction with taking
money from the vault, known as the opening cash balance. Jault is kept in a more
secured place. 5he amount of opening cash balance is entered into a register. fter
whole days. transaction, the surplus money remains in the cash counter is put back in
the vault and known as the closing balance. If the cash st ock goes beyond t hi s
l i mi t , t he e1cess cash i s t hen t ransf erred t o ,"I ( bank mai n branch.
5he main functions of this section are-
1. (ash &eceipt
#. (ash 3ayment
<.1 CASH RECEIPT
(ash receipt procedure is given below-
i. 5he depositor first fills up the +eposit-in-"lip.
ii. +epositor deposits the money.
iii. !fficer receives the money, counts and then enters in the (ash &eceipt
&egister, and finally signs with seal and dates the deposit-in-slip.
iv. "lip is then passed to another officer, who enters the receipt details like
serial no, amount, etc. in his register, signs the slip and keeps the
banks. part of the slip. !ther part is given to the depositor.
v. t the end of the day, entries are cross checked with the register kept at
the cash counter to see whether the transactions are correct or not.
45
A!!"#n$ing $&%a$+%n$-
Bhen cash recei ved, t he f ol l owi ng ent ri es are made-
(ash : (BBBBBBBBB. +ebi t
3art y. s : (BBBBBBBB(redi t
<.2 CASH PAYMENT
"ome important check points for making the payment are as follows-
1. En1"&s%+%n$
2ndorsement is done by putting signature of the drawer on the back of the
negotiable instrument for the purpose of negotiation. ,y Nblank endorsement., an
order instrument is made as Nbearer.. ,"I( bank limited endorses the
instrument in the following ways-
ENDORSEMENT IN CASE OF
3ayee.s :( credited 3ay to Mr.F
&eceived payment
3ayee.s :( credited
3ay to ,"I( bank, Mr.F
3ayee.s :( credited 3ay to Mr.F , ,"I( bank
2. C&"ssing
>enerally two types of crossing are practiced, namely- >eneral (rossing and
"pecial (rossing. ,asically it gives a direction to the paying bank not to pay the
check amount over the counter. >eneral crossing includes N:( payee. crossing
only. +rawing two parallel and transverse lines do it. !n the other hand, special
crossing is like general crossing but in addition bank name is also mentioned.
5his gives the direction to the same to pay the check only to the banker, whose
name appears in the crossing or to his agent.
Cas( ,a2+%n$ ,&"!%1#&% is giv%n 6%'";4
i. (ustomer first deposits the check /s0 to the cash section. uthori-ed
individual checks whether it is materially altered, proper endorsed,
crossed or not. ,eing satisfied the total re<uirements= he passes it to
the computer for checking the balance. !perator verifies the check leaf
security no. If matched, then operator signs. !therwise noticed to the
individual for stop payment=
ii. uthori-ed officer is then verified the signature with the "pecimen
"ignature (ard /""(0=
iii. "end the instrument to the computer section once again for posting=
45
iv. (ash officer is then asked the bearer to sign on the back of the
instrument. t the same he Aust enters the payment details in his
register and pays the money to the bearer=
v. t the end of the day, these information must be tallied with computer
postings to ensure the correctness of payment.
A!!"#n$ing $&%a$+%n$ -
Bhen cash pai d, t he f ol l owi ng ent ri es are made-
3art y : (PPPPPPPPP. +ebi t
(ash : (PPPPPPPPP. . (redi t
Dis("n"& "3 C(%A#%
If the che<ue is dishonored, ,"I( bank sends a memorandum /che<ue return
memo0 to the customer stating the reason in the following way-
i. &efer to drawer
ii. @ot arranged for.
iii. 2ffects not cleared. May be presented again.
iv. 21ceeds arrangements.
v. Full cover not received.
vi. 3ayment stopped by drawer.
vii. -------------3ayee.s endorsement irregular: illegible: re<uired.
viii. ---------------3ayee.s endorsement irregular: re<uire ,ank.s confirmation.
i1. +rawer.s signature differs: re<uired.
1. lteration in date: figures: words re<uires drawer.s full signature.
1i. (he<ue is post dated: out of date: mutilated.
1ii. mount in words and figures differs.
1iii. (rossed che<ue must be presented through a bank.
1iv. (learing stamp re<uired: re<uires cancellation.
1v. ddition to ,ank.s discharge should be authenticated.
1vi. (he<ue crossed Hccount 3ayee !nlyI
1vii. (ollecting ,ank.s discharge irregular: re<uired.
If the check is dishonored due to insufficiency of funds, ,"I( bank charges 5k.188:;
as penalty.
=.0: FDR AND ANCI..ARY SER0ICES SECTION
45
=.1 FICED DEPOSIT RECEIPT *FDR-
FDR A!!"#n$
Fi1ed deposits are time deposits or time liabilities. 5hese are the deposits in which an
amount of cash is deposited in ,ank for a fi1ed period specified in advance. ,efore
opening a Fi1ed +eposit ccount a customer has to fill up an application form which
contains the followings-
mount in figures
,eneficiary.s name and address
5ime period
&ate of Interest
+ate of Issue
+ate of maturity
6ow the account will be operated / singly or Aointly0
"ignature /s0
F.+.&. no.
"pecial instructions /if any0
fter fulfilling the above information and depositing the amount, F+& account is
opened and a F+& receipt is issued and it is recorded in the F+& &egister which
contains the following information-
F+& account no.
F+& /Fi1ed +eposit &eceipt0 no.
@ame of the F+& holder with address
Maturity period
Maturity date
Interest &ate
In case of F+& ccount, the bank does not have to maintain a cash reserve. "o,
,"I( bank offers a high interest rate in these accounts. 5he revised interest rates for
F+& effected from +ecember 81, #88$ followed by ,"I( are-
a0 For $ months E above Q ?.88 9
b0 For * months E above Q ?.)89
c0 For 1# months E above Q ?.?)9
d0 For #' months E above Q R.88 9
45
In case of encashment of F+& Ssay for 5k.F T on maturity, following accounting
treatments are given-
Interest on F+& :( -------------------------------(r. Ssay 5k. 3T
21cise +uty on F+& -------------------------------+r Ssay 5k. KT
18 9 Income 5a1 on interest --------------------- +r. Ssay 5k. &T
F+& :( ---------------------------------------------+r. S5k. /FU3-K-&0T
(ash :( ---------------------------------------------(r. S5k. /FU3-K-&0T
If the customer wants to draw the interest only, then the following entries are given L
Interest on F+& :( --------------------------------+r.
(ash :( ---------------------------------------------(r.
R%n%;a' "3 FDR
(ustomer supposes to inform the bank in writing 1) days before the maturity date for
encashment. If not, bank normally renews the amount Aust after the maturity date.
&enewal will be for previously agreed maturity period.
."ss "3 FDR
If the instrument is lost from the possession of the holder, the holder is asked to fulfill
the following re<uirements-
a0 6older should inform the bank immediately
b0 &ecord a >+ />eneral +iary0 in the nearest 3olice "tation.
c0 Furnish an Indemnity ,ond
!n fulfilling the above re<uirements, ,"I( bank is then issued a duplicate F+&.
Ta6'%49.2: P&%4+a$#&% En!as(+%n$ "3 FDR
45
P%&i"1 P&%4+a$#&%
En!as(+%n$
In$%&%s$ Ra$%
81 $ months
,efore $8 days @o Interest
2very completed calendar
months
", /"avings ,ank0 &ate
8# * months
,efore $ months ", &ate
,efore maturity but
completes $ months
Interest payable at $ months &ate
for a period of $ months
8$ 1# months
,efore e1piry of * months Interest payable at $ months rate for
a period of $ months
fter e1piry of * months
but before maturity
Interest payable at * months rate for
a period of * months
8' #' months
fter e1piry of * months
but before maturity
Interest may be allowed at * months
rate for a period of * months
fter e1piry of 1# months
but before maturity
Interest may be allowed at 1#
months rate for a period of 1#
months
Source: !"#$ ranc%, AS&' an( )td.
=.2 SANCHAYAPATRA
,"I( bank is uni<ue for selling San!(a2 ,a$&a to its customers as its ancillary
services on behalf of govt. "anchay patra is issued by Catio "hanchay ,ureau, guided
by ,angladesh ,ank. It is received from ,angladesh ,ank /,,0. 3eople purchasing
these bonds by depositing money in this branch and payment are made on maturity to
customers from this branch only. 2very transaction is reported to ,,. Bithin 'R hours,
otherwise penalty is imposed. Money is reali-ed from ,, after making payment to
customer. 5his branch gets 19 commission for this service. s a whole following
things are conducted by this section-
"elling of "hanchaypatra
Making payment on maturity
&eporting to ,angladesh ,ank
(alculation of interest
ccounting.
D%$ai's "3 S(an!(a2,a$&a
45
5able-'.$: "howing different types of shanchaypatras
S' T2,%s .i+i$ In$%&%s$
1. ) years ,angladesh
"hanchay 3atra
"ingly- 1) %ac. fter 1 year R.)89 and per yr. 19
increases and on maturity 1#.)89. Cointly- $8 %ac.
#. $ years Investment
"cheme on <uarterly rest
"ingly- #8 %ac. Interest rate - 1#9
Cointly- '8 %ac.
Source: 'ircu*ar *etter no. AS&'/+O/'A!/2,,2/1728
=.) .OC:ER SER0ICE
,"I( ,ank +234 branch is also uni<ue for providing locker service to its customers.
3eople usually keep their valuables for securing purpose.
T%&+s an1 C"n1i$i"ns
&enter must have an account either current or deposit.
ll rentals are payable annually in advance.
%ockers will be rented for a period of one year in the first instance and will
automatically be renewed thereafter from year to year until terminated.
In order to terminate the hire written notices must be given at least one
week period to the e1piry date of the hire and the locker with its keys must
be surrendered to the bank.
5he renter shall have access to the locker at anytime during the ,ank.s
business hours.
%ockers may be hired in two or more names but not e1ceeding four and in
such cases the renters must give e1plicit instructions as to whether access
is to be allowed to either renters singly or two or more of their member
Aointly.
If the renter loses the keys of the locker the bank must be notified without
delay. In such an even all e1penses the renter shall pay regarding breaking
the locker and substituting a fresh lock and keys.
In respect of the hire of safe deposit lockers the relationship between the
bank and the renter is that of a licensor and licensee and not that of banker
and customer.
Ta6'%49.9: ."!%& s%&vi!% a$ a g'an!%
45
T2,% "3 ."!%& SiD% *in !+.- T"$a' N". R%n$%1 Ann#a' C(a&g%
"mall )R F 17 F 1#.) 78 8* 5k. 1#88
Medium )R F $).) F 1#.) ') 8R 5k. 1R88
@ote: 5k. 1)88:; /&efundable0 is applicable for all kinds of lockers as security charge.
=.9 Wag% Ea&n%&s B"n1s:
!nly wage earners bonds that are ,angladeshi national staying out side ,angladesh
is entitled for this bonds through F( a:c. ,onds are received from ,angladesh bank.
,onds are sold to customer in this branch and payment on maturity also made here.
2very transaction is reported to ,,. In case of issuing bonds, report to be reached to
,, within ' days otherwise penalty is imposed. Money is reali-ed from ,, after
making payment to customers.
In$%&%s$ &a$%: 1#9 and on maturity interest is compounded half yearly basis.
+enomination: /5k.0 #)888, )8888, 188888.
45

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General Banking----------------------------------------------------------------------BASIC Bank Ltd.

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