Internship Affiliation Report

FUNCTION OF FOREIGN EXCHANGE

DEPARTMENT OF STANDARD BANK LTD

II INTRODUCTION

a. Rationale
For Masters of Business Administration (MBA) student only theoretical knowledge is not
enough for handling the real life business situation. It is a great opportunity for the student to
know about the real business operations through the internship program. Internship program is
the perfect blend of the theoretical and the practical life experience. It is mandatory for any MBA
student of American International University of Bangladesh. Banks are the pillars of the financial
system of any Country. Specially, In Bangladesh, proper banking system is very important and
essential to play a vital role, because our capital market system is not advanced like other
countrys Capital market.
The commercial banking activities of the encompass a wide range of services like accepting
deposits, making loans, discounting bills, conducting money transfer and foreign exchange
transaction . Foreign exchange operation is one of the significant functions of the bank. It plays
a vital role in overall economy of the country. I am proposing this study, as I am a student
of MBA and moreover my major is in Accounting & Finance, this study is very much
related to my future career. While making the report, I will be able to learn the foreign
trade system and its overall process. The proposed study can enhance knowledge about
the foreign currency or goods trade of the Standard Bank Ltd. which includes the study of
various international trade financing tools and settlement process and financial analysis of the
SBL. In this internship program, I was a part of team of Standard Bank Ltd with all my
responsibilities from the very first day. I was mainly engaged in foreign exchange
department where I have gone through a number of meaningful projects and targets
set by the bank management. In this regard, I have prepared the affiliation report titled
Function of foreign exchange department of Standard Bank Limited.

b. Background

Standard Bank Limited was incorporated as a public limited Company on May 11, 1999 under
the companies Act, 1994 and the bank achieved satisfactory progress from its commercial
operations on June 03, 1999. SBL has introduced several new Products on credit and deposit
schemes. It also goes for corporate or retail banking etc. The bank also participated in fund
syndication with other banks. Through all these myriad activities SBL has created a positive
impact in the market. Standard Bank Limited is a third generation bank in Bangladesh. Standard
Bank has its head office at 122-124 Motijheel, Chamber building, Dhaka, Bangladesh as a
public limited company with the permission of the Bangladesh Bank. The founder of SBL is
committed to setting a new standard of banking. The Authorized capital of the bank is BDT
15000(million) and its Share holders Equity is BDT 6871(million) in 2011.The bank provides a
broad range of financial services to its customers and corporate clients in retail banking,
corporate banking, and international trade. The whole banking activities are divided into
3parts,General banking, Loan & Advances and Foreign Exchange. One of the largest businesses
carried out by the commercial bank is foreign trading .The trade among various countries falls
for close link between the parties dealing in trade. The situation calls for expertise in the field of
foreign operation. The bank which provides such operation is referred to as rending international
banking operation. Mainly transactions with overseas countries are respects of import, export,
and foreign remittance come under the preview of foreign exchange transactions. International
trade demands a flow of goods from seller to buyer and of payment from buyer to seller .In this
case the bank plays a vital role to bridge between the buyer and seller. The foreign exchange
department divides into three parts-export, import and remittance. The export department deals
with export L/C, Amendment of L/C, Transfer of L/C, EXP issue charge. When the L/C amounts
have to be changed, then the amendments of L/C are needed. The expenses sectors of export are
Courier/mailing cost, Stationary cost, Printing cost, Salary of the employee. Salary of the
employee is the administrative cost. But here to analyze the actual earning of export, Ive to find
out the totla expenses to operate export department. Import sector is the most profitable sector in
foreign exchange department of SBL. The Export sector is also doing their level best. The import
earning sectors are-commission for L/C opening, Amendment of local L/C, Service charges,
Collection of credit report of the beneficiary. From commission for L/C opening and service
charge, import department earns most. The expenses of export, import, and remittance are almost
the same. The remittance earning consist from-Issuance of cash and endorsement of passport,

remittance by TT, Cash incentives handling charge etc. The portion of foreign exchange earnings
from total earning is also satisfactory. So Standard Bank Limited is one of the best leading bank
in Bangladesh and this bank have to continue its performance analysis and have to find out the
ways how it can perform its activity much better.
Vision of Standard Bank Ltd.
To be a modern Bank having the object of building a sound national economy and to contribute
significantly to the Public Exchequer.
Mission of Standard Bank Ltd.
To be the best private commercial bank in Bangladesh in terms of efficiency, capital adequacy,
asset quality, sound management and profitability.
Core Values of Standard Bank Ltd.

Shareholder: By ensuring fair return on their investment through generating stable

profit.

Customer: To become most caring bank by providing the most courteous and efficient
service in every area of our business.

Employee: By promoting the well being of the members of the staff.

Community: Assuring our socially responsible corporate entity in a tangible manner

through close adherence to national policies and objective.

Objectives of the bank

The Motto of the Standard Bank limited is to explore a new horizon of innovative modern
banking creating an automated and computerized environment providing nonstop service and
prepare itself to face the new challenges of globalization and 21 st century. The main objectives of
Standard Bank Limited are:

To provide high quality products and service to attract its potential market.
To caters to the need of its corporate clients and provides a comprehensive range of
financial services to national and multinational companies.
Act as a media of exchange.
To contribute to gross domestic product.
Maintain a satisfactory deposit mix.
To help to grow entrepreneurship.
Increase loan portfolio diversification and geographical coverage.
To help to solve unemployment problem.
Provide finance and specialized services to the export.
To help to boost economic development.
To earn profit.
The bank has already co-opted technological revolution in all its spheres.
Branches of SBL
From the year 1999 to year 2011 Standard Bank Limited established 68 numbers of branches in
different districts of Bangladesh. The principal Branch located in Metropolitan Chamber
Building (Ground Floor), 122-124 Motijheel C/A, Dhaka 1000, and Bangladesh.
Organization Offerings:
Standard Bank Limited is always conscious of the changing needs of customers and strives to
develop new and improved services for its valued customers. Ban offers various deposit and
lending products and services to meet all kinds of financial needs of customers. Such as

Maintain all types of account.

Make investment.

Handle foreign exchange business.

Intend other banking sector etc.

SBL also collect TITAS bill, WASA bill, Telephone bill and Electricity bill.

Communication intensity between managers, assistant or the work team is moderately high. Or
achieving any kind of organization goal, most of the frequently communicate with each other.
They are bound to maintain frequent relationship with each other.
Organogram:
In the line of policy formulated by the management under approval of Board of director proposal
are forwarded by relationship Manager (RM) through Head of corporate at Head Office to Head
of GB who in term will make a through scrutiny of the proposal in terms of General Banking
assessment for according approval/ decision to the proposal for sufficing the purpose a preferred
organizational structure is to be developed under :

Board of Directors
Managing Director
Executive Vice President
Senior Vice President
Vice President
Senior Assistant Vice President

Assistant Vice President

First Executive Vice President

Senior Executive Officer

Executive Officer
Senior Officer
Officer
Assistant Officer

Functions of SBL
The key function of the organization is as follows

To mobilize deposits.

To disburse investments

To handle foreign exchange and foreign business

Remittance: To remit money to home and abroad through T.T, D.D, Pay-order, Travelers
cheque, etc.

Other services: e.g. Locker service, to receive different types of bills of clients to issue
Guarantees and counseling etc.

Major Division of SBL

The banking system of Standard Bank Ltd. is divided into three major divisions. These
divisions are
1) General Banking
2) Advance & Loan Banking
3) Foreign Exchange Banking.

C. Objectives:
To know about overall Foreign Exchange sector of Standard Bank Limited, Gulshan Branch.
To know how a bank manages its Foreign Exchange Department.

3.0 ACTIVITIES UNDERTAKEN :

3.1 JOB AS AN INTERN(Work-Related):
During the internship period at Standard Bank Ltd, I was placed in different departments on
rotation basis. At first I was in General banking section for a week, then in Credit section for a
week and finally in Foreign Exchange section for 10 weeks. So it was a great experience for me
to work in different departments.
FOREIGN EXCHANGE :
Foreign exchange covers all business activities relating to import, export, inward and outward
remittance and buying and selling of currency. One of the largest businesses carried out by the

commercial bank is foreign trading. The trade among various countries falls for close link
between the parties dealing in trade. The situation calls for expertise in the field of foreign
operations. The bank, which provides such operation, is referred to as rending inter Standard
banking operation. Mainly transactions with overseas countries are respects of import; export
and foreign remittance come under the preview of foreign exchange transactions. Inter Standard
trade demands a flow of goods from seller to buyer and of payment from buyer to seller. In this
case the bank plays a vital role to bridge between the buyer and seller.
In Standard Bank Ltd ( Gulshan-2) foreign exchange division has one part which is foreign trade.
3.1.1 FOREIGN TRADE DEPARTMENT:
Mainly foreign trade deals with import and export business that is two parties in foreign trade
department in Standard Bank Ltd ( Gulshan-2).
1. Import department.
2. Export department.
3. Foreign remittance.

a. Organization-wide
b. Other relevant activities
IV CONSTRAINTS/CHALLENGES AND PROPOSED COURSE OF ACTION FOR
IMPROVEMENT
(Issues and Problems encountered and identified during the internship affiliation with the
organization/company.)
a. Identified/Observed in the Organization
This report might be limited with some constraints. Details of many aspects of the services of
Standard Bank Limited have been skipped in this report due to various constraints, including
time and space. Moreover, one of the main barriers in writing this report was the confidentiality

of data. Besides, for the preparation of this report I found that there are some limitation exists
though I have given my greatest effort. Such as:

The bankers are very busy with their job which lead me little time to consult with.

Category wise export, import and remittance business; amount originated from the
international trade is missing in the report for their restriction.
In many cases, up to date information was not published.

All the branches of the sample banks were not physically visited.

Non-availability of reference books is another limitation.

Due to time limitation many of the aspects could not be discussed in the present report.
Learning all the functions within just 60 days is really tough.

However, omitting the limitations, the report will help to understand the Foreign Exchange
Performance of the Bank.
b. Academic Preparation (Mismatch between assigned tasks and other
operational functions of the organization with your academic
preparation/major. Relevance of the academic preparation /major to the
present assignment and future job requirements of the organization)
c. Any missing knowledge and skills that need to be learned in the university
which are relevant to the company or to oneself as future professional.

V LESSONS LEARNED FROM THE INTERNSHIP PROGRAM (These are

the valuable lessons/knowledge /skills/behavior/practices you have learned or
acquired from your internship.)
a. Implications to Organization/Company Based Affiliation
b. Implications to Universitys Internship Program
c. Others

VI CONCLUDING STATEMENTS
a. Recapitulation /Summary

b. Recommendations for Future Strategic Actions (Over-all Internship

Program: Affiliation and University)

VII- SUGGESTIONS FOR IMPROVEMENT OR COURSE OF ACTION

(Mention specific suggestions to address the problems identified or observed during

the affiliation. You may refer to Part IV on Constraints)
References:

APPENDICES: (Including a 2-page CV)

Note: The Report should not be less than 20 pages excluding the Appendices.