Internship Report

On
Financial Performance Analysis:
A Comparative study Between IBBL and SJIBL
 Acknowledgement
First of all I remember Almighty Allah for making me successful to prepare this report. I am
grateful to the Islami Bank Bangladesh Limited authority that has helped me by updating
desired information at their website. At the very outset, I would like to thank Saleh Md. Arman
(Lecturer, department of Business Administration, MIU) &MdSalehMathinCourse-Coordinator,
SPO & Faculty member of IBTRA for giving me the opportunity to know about the Islamic
Banking in Bangladesh, and without their support and direction it would never be possible for
me to make this report.

I’ve talked all the concerned officers of the Islami Bank Bangladesh Limited,
MouchakBranch, who kindly provided me the information and other handouts. Especially i
cannot but mention Rafiqul Islam sir, Assistant Vice President, Md. YasinALi, PO, Atiqul
Islam PO, Al-Amin Hossain, PO, Md. Abu jafor, and Assistant Officer of this branch.

The management of this Branch had been extremely helpful in providing necessary
documents, annual report, statements, voucher etc. which helped me to prepare this Internship
report. I express a deep debt of appreciation & gratefulness to the employees of IBBL,
Mouchak Branch.
 Executive Summary
Banking system plays a very important role in the economic life of the nation. The health of
the economy is closely related to the soundness of its banking system. In a developing
country like Bangladesh the banking systems as a whole play a vital role in the progress of
economic development.
IBBL is a third generation bank in the private sector banking of Bangladesh. IBBL is the
private commercial bank that is a brain child of some successful local entrepreneurs. IBBL is
a banking company registered under the Companies Act, 1913 (At present the companies
Act, 1994) with its Head Office at 40, Dilkusha Commercial Area, Dhaka- 1000, Bangladesh.
The bank started its historical operation on the 30th March 1983. Now it has as many as 294
Branch throughout the country.

This report was originated in result of my internship, which I did, as must requirement
ofBBA program. This report was done based on my learning of 8 weeks internship in Islami
Bank Bangladesh Limited. The objective of this report was to gain knowledge from on thejob
experience and at the same time analyze the financial performance based on the knowledge
that I gathered in the BBA courses.
The report gives idea about the financial performance of the Islami Bank Bangladesh Limited
and Shajalal Islami Bank Limited. Both are islamic banks in Bangladesh. I used trend
analysis, ratio analysis and comparative analysis to describe the financial performance of
IBBL & SJIBL. So, the report will be descriptive in nature. I discussed with the officials and
executives of the IBBL, Mouchak Branch and found the approximate data which has been
used in this report. I have also collected secondary data from the annual reports and training
materials provided by the IBTRA. To analyze and present the numerical data and values I
have used column chart, bar chart, line chart, pie chart, and the formula has generated and
used in Microsoft Excel. I compare all data year wise. All sorts of analysis have been
executed, in order to analyze how efficient, liquid, profitability, secure and desirable the bank
is in terms of its finance. Then I have shown some findings from the qualitative and
quantitative analysis of IBBL.

In this report I have try to show comparative financial performance through ratio analysis,
trend analysis, vertical & horizontal analysis. Overall financial performance of IBBL is
increasing day by day. Because most of the people in our country are religious minded and
they want to transact their money according to Islamic Shariah.
 Chapter One
Introduction of the report

1.1 Background of the Report:

Internship program of University is a partial requirement for the graduation of BBA students.
Every B.B.A student is appointed to learn some practical knowledge with in the pre-stipulated
period by observing the organization day to day activities. In this regard my internship program
started at 4 Oct. at Islami Bank Bangladesh Limited. This internship program was my on the job
exposure and provided me with learning experience and knowledge in several areas. I was not
only learned about the activities and operations of correspondent Bank, but also gathered some
knowledge about the basic business of banking from my internship period.
Islamic banks are unconditional and specialized financial institutions that perform most of the
standard banking services and investment activities on the basis of profit and loss sharing system
conforming to the principles of Islamic Shari’ah. Out of 50 banking institutions, 8 banks are
backed by Islamic mechanism and worldwide accepted Islamic morality and established code of
conduct.
Islami Bank Bangladesh Limited pursues decentralized management policies and adequate work
freedom to the employees. This result in less pressure for the workers and acts as a motivational
tool for them, also gives them encouragement and inspiration to move up the ladder of success.
Overall, I have experienced a very friendly and supporting environment at Islami Bank
Bangladesh Limited, which gave me the pleasure and satisfaction to be a part of them for a while.
While working in different departments of IBBL, Farm gate Branch, I have found each and every
employee is friendly to me to co-operate. They have discussed in details about their respective
tasks. I also participated with their works. I have carried out my internship in Islami Bank
Bangladesh Limited. So, as an integral part of my graduation and as a great opportunity of
acquiring knowledge about banking, this internship report has been prepared.
Shajalal islami bank is another Islamic Shari’ah bank. But there has difference between IBBL and
SJIBL. I have find out this difference and comparison financial performance between them. In
this regard I made this internship report.
1.2 Scope of the Report
Islami Bank Bangladesh Limited has 294 branches at present. Among those I have chosen
Mouchak branch. Here I have worked 45 days. The working environment of this branch is very
convenient. I have discussed the performance of IBBL and SJIBL over the years 2010 – 2014.
I think the report will helpful to know about, it’s financial performance.

1.3Objectives of the Report

1.3.1 Broad objective:

The broad objective of this report is to analyze the comparison of financial performance between
Islami Bank Bangladesh Limited and Shajalal Islami Bank Limited.
1.3.2 Specific objectives:

In order to accomplish the broad objective following specific objectives are emerged,

1. Compare the financial performance of IBBL with SJIBL Bank through 2010-2014.
2. To calculate the ratio analysis between IBBL and SJIBL.
3. Ratio like liquidity, profitability, activity, leverage is calculated.
4. To asses Vertical Analysis.
5. To measure Horizontal analysis.
6. To show comparative Trend Analysis.

1.4Methodology of the Report

In order to conduct such a study the report preparer must follow some specific methods. This
report is based on an empirical method which is stated under.
1.4.1 Source of data
All the relevant data regarding this report are collected from two sources.
1.4.1.1 Primary sources of data: Direct interview process in bank employees.
1.4.1.2 Secondary Sources of data
(A) Annual report of IBBL and SJIBL from 2010-2014.
(B) Printed forms and documentation supplied by IBBL.
(C) Collect data from IBBL and SJIBL bank’s website.
(D) Communicate the branch manager and employee.
(E) Relevant books, journals, booklets etc.
1.4.2 Data Analysis Tools and Techniques:
To analyze and present the numerical data and values associated with comparative financial
performance of IBBL and SJIBL, I have used following tools and techniques,

i. Column Chart,

ii. Bar Chart,

iii. Line Chart,

iv. Pie Chart, and

The formula has generated and used

 Microsoft Excel
 Microsoft word
 Spss, etc
1.4.3 Data Analysis and Reporting
Both qualitative and quantitative analyses have been done while conducting this study. Microsoft
Word and Microsoft Excel were used to analyze, process and graphically represents the gathered
data.

1.4.4 Sample

The study chose SJIBL conveniently.

The study calculated Ratio Analysis on the basis of the given formulas. Vertical Analysis
was calculated on the basis of the percentage of each segment. Horizontal analysis was
assessed in order to find out the respective change on the given particulars. The trend
analysis showed the pattern of Assets, Liabilities, Net Income and Owner’s Equity on
graphical procedure.

1.5 Limitation of the Report

 The study is provided for a period of five years 2010-2014
 The analysis is based on annual reports of the IBBL and SJIBL.
 This Report is considered only 10 ratios.

Chapter review

 Background of the Report

 Scope of the Report
 Objectives of the Report
 Methodology of the Report
 Limitation of the Report
 Chapter Two
Organization Profile

2.1 Introduction
Banks are the most important financial institution in the economy. For this reason most of the
banks are established. Islami bank is among of them which is established on March 13, 1983. This
bank is established on the basis of free of riba.Where all the banks are working with riba. But riba
is definitely haram in islam.. As it is Haram in Islam the Muslim scholars thought a plan to
establish a banking system that is free from interest and will work on the basis of profit loss
sharing. Then depending on this thought, , it is decided to establish Islamic banks through the
whole world to protect everyone from this curse.

2.2 Definition of Islami Bank

The Organization of Islamic Conference (OIC) defined an Islamic Bank as a financial institution
whose statutes, rules and procedures expressly state its commitment to the principles of Islamic
Shariah and to the banking of the receipt and payment of interest on any of its operation.

According to Islamic banking Act 1983 of Malaysia, and Islamic Bank is a company which carries on
Islamic Banking Business Islamic Banding business means banking business whole aims and
operations do not involve any element which is not approved by the religion Islam.

2.3 Characteristics of Islamic banks

1. It is a financial institution.
2. It is a business institution.
3. It operates its business activities free from interest.
4. It is run according to rules and regulations formed and amended by Shariah Council.
5. Islamic bank means not business product but running business through money.
6. It is profit loss sharing business organization.
7. It provides loan as Quard Hashanah for social welfare.
8. It gives Zakat on its capital according to Islamic Shariah.
9. It leads all of its transaction according to Islamic law.
10. No form of work is done which is in Islamic etc.

2.4 IBBL is an Islami Bank

The characteristics of Islamic Bank are found in the IBBL. They strongly follow and do their
activities under the Islamic Shari’ah. So there is no doubt IBBL is an Islamic Bank.

2.5 Historical background of IBBL

 In August 1974, Bangladesh signed the Charter of Islamic Development Bank and committed
itself to reorganize its economic and financial systems as per Islamic Shariah. In January
1981, the president of Bangladesh, the then, while addressing the 3rd Islamic Summit
Conference held at Mecca and Taif suggested, “ The Islamic countries should develop a
separate banking system of their own to facilitate their trade and commerce.”

In November 1982, a delegation of IDB visited Bangladesh and showed keen interest to
participate in establishing a joint venture Islamic Bank in the private sector. They found a lot
of work had already been done and Islamic banking was in a ready form for immediate
introduction. Two professional bodies Islamic Economics Research Bureau (IERB) and
Bangladesh Islamic Banker’s Association (BIBA) made significant contributions towards
introduction of Islamic banking in the country.

At last, the long drawn struggle, to establish an Islamic bank in Bangladesh becomes a reality.
Islami Bank Bangladesh Limited was established in March 1983. In which 19 Bangladeshi
nationals, 4 Bangladeshi institutions and 11 banks, financial institutions and government
bodies of the middle east and Europe including IDB and eminent personalities of the kingdom
Saudi Arabia joined hands to make the dream a reality.

2.6 Mission of IBBL

To establish Islamic banking through the introduction of a welfare oriented banking system
and also ensure equity and justice in the field of all economic activities, achieve balanced
growth and equitable development through diversified investment operations particularly in
the priority sectors and less developed areas of the country, to encourage socio-economic
uplift and financial services to the low income community particularly in the rural areas.
2.7 Vision of the IBBL
The vision of Islami Bank Bangladesh limited is to strive to achieve superior financial
performance be considered a leading Islamic bank by reputation and performance.
 To establish and maintain the modern banking techniques
 To ensure the soundness and development of the financial system based on Islamic
principles and to become the strong and efficient organization with highly motivated
professionals, working for the benefit of people, based upon
 Accountability, transparency and integrity in order to ensure stability of financial
systems.
 Encourage savings in the form of direct investment.
 To encourage investment particularly in projects which are more likely to lead higher
employment

2.8 Objective of the IBBL

  To conduct interest-free banking.
 To establish participatory banking instead of banking on debtor-creditor relationship.
 To invest through different modes permitted under Islamic Shariah.
 To accept deposits on profit-loss sharing basis.
 To establish a welfare-oriented banking system.
 To extend co-operation to the poor, the helpless and the low-income group for their
economic development.
 To play a vital role in human development and employment generation.
 To contribute towards balanced growth and development of the country through
investment operations particularly in the less developed areas.
 To contribute in achieving the ultimate goal of Islamic economic system.

2.9 Islami Bank Bangladesh Limited at a glance (As on 31st December, 2014):

1. Date of incorporation : 13.03.83

2. Date of receiving Banding license : 28.03.83
3. Date of incorporation of first branch (Local office Dhaka) : 30.03.83.
4. Formal inauguration : 12.08.83
5. Zone : 14
6. Authorized capital : 20,000.00 million
7. Share of capital : a) Local-share holders : 32.49%
b) Foreign shareholders : 67.51 %
8. Paid -up capital : 16,099.91 million
9. Equity (31/12/2014) :Tk.46612.81million
10. Branches :294
11. Deposit (31/12/2014) : Tk. 560,696.30 million
12. Investment (31/12/2014) : Tk. 564,332.00 million
13. Foreign Exchange Business (31/12/2014) : Tk. 848,447.00 million
14. Number of employee (31/12/2014) : 13,349
15. Shareholder (31/12/2014) : 61,657

2.10 Special features of IBBL

o All activities are conducting on interest-free according to Islamic Shariah principle.
o Investment made through different modes as per Islamic Shariah
o Establishment of participatory banking instead of banking on debtor-creditor relationship.
o Investment income of the Bank is shared with the Mudaraba depositors according to a
ratio to ensure a reasonable fair rate of return on their depositors.
o Its aims are to introduce a welfare-oriented banking system and also to establish equity
and justice in the field of all economic activities.
 o It extends Socio-economic and financial services to the poor, helpless and low-income
group of the people for their economic enlistment particularly in the rural areas.
o It plays a vital role in human resource development and employment generation
particularly for the unemployment youths.
o Portfolio of investment & investment policy have been specially tailored to achieve
balanced growth and equitable development through diversified investment operations
particularly in the priority sectors and in the less developed areas of the national
economy.
o Ensures Shariah compliance through regular and effective guidance of powerful and
highly esteemed Shariah council consisting of 13 members representing Shariah scholars.
2.11 Distinguish between Islamic and Conventional Banking

There are many differences between Islamic Bank and Conventional Bank. There are discussed most
important differences.
The distinguishing features of the conventional banking and Islamic banking are shown in terms of a
box diagram as shown below:

Conventional Banks Islamic Banks

1. The functions and operating modes of
conventional banks based on manmade
principles.
2. The investor assured of a predetermined rate of
interest.
3. It aims at maximizing profit without any
restriction.
4. It does not deal with Zakat.
5. Leading money and getting it back with
interest is the fundamental function of the
conventional banks.
6. It can charge additional money (compound rate
of interest) in case of defaulters.
7. In it very often, bank’s own interest becomes
prominent. It makes no effort to ensure growth
with equity.
8. For interest-based commercial banks,
borrowing from the money market is relatively
easier.
9. The Client’s status is creditor and debtors.
10. For interest based commercial banks,
borrowing from the money market is
relatively easier.
11. Since income from the advances is fixed, it
gives little importance to developing
expertise in project appraisal and evaluations.
1. The functions and operating modes of Islamic
banks based on the principles of Islamic
Shariah.
2. In contrast, it promotes risk sharing between
provider of capital (investor) and the user of
funds (entrepreneur).
3. It also aims at maximizing profit but subject to
Shariah restrictions.
4. In the modern Islamic banking system, it has
become one of the service-oriented functions
of the Islamic banks to collect and distribute
Zakat.
5. Participation in partnership business is the
fundamental function of the Islamic banks.
6. The Islamic banks have no provision to charge
any extra money from the defaulters.
7. It gives due importance to the public interest.
Its ultimate aim is to ensure growth with
equity.
8. For the Islamic banks, it is comparatively
difficult to borrow money from the money
market.
9. The status of clients is investors and trader.
10.For the Islamic banks, it is comparatively
difficult to borrow money from the money
market.
11.Since it shares profit and loss, the Islamic
banks pay greater attention to developing
project appraisal and evaluations.
2.12Management hierarchy
Chapter Three
 Comparative financial performance between IBBL and SJIBL

4.1Ratio analysis
4.1.1Current ratio:Current Ratio = Current Assets / Current Liabilities
Year 2010 2011 2012 2013 2014
IBBL 1.09 1.08 1.16 1.14 1.09
SJIBL 1.11 1.35 1.28 1.25 1.27

 Source: Annual Report 2010-2014

Current ratio
1.6
1.4
1.2
1
0.8
0.6
0.4
0.2
0
2010 2011 2012 2013 2014
IBBL 1.09 1.08 1.16 1.14 1.09
SJIBL 1.11 1.35 1.28 1.25 1.27

Graph 1: current ratio

Findings:SJIBL’S current ratio is higher than IBBL from 2010-2014. Here it shows SJIBL
current ratio is better than IBBL. IBBL current ratio decreased in 2011. But increase
2012 & 2013 and 2014 it is decrease. On the other hand SJIBL current ratio increase
2011 but decrease next two year 2012&2013 and the last year its current ratio is
increased.
4.1.2 Return on Asset:
Year 2010 2011 2012 2013 2014
IBBL 1.47% 1.35% 1.27% 0.96% 0.67%
SJIBL 3.01% 1.26% 1.44% 1.01% 0.59%

 Source: Annual Report 2010-2014

 Return on Asset(ROA)
3.50%

3.00%

2.50%

2.00%

1.50%

1.00%

0.50%

0.00%
2010 2011 2012 2013 2014
IBBL 1.47% 1.35% 1.27% 0.96% 0.67%
SJIBL 3.01% 1.26% 1.44% 1.00% 0.59%

Graph 2: Return on Asset (ROA)

Findings:Return on Asset ratio shows how a bank can convert its asset into net earnings. In this
graph we see IBBL’s ROA is decreasing gradually 2010 to 2014. ROA of SJIBL is
slightly higher 2010, 2012, 2013 from IBBL. ROA of IBBL is higher 2011 & 2014
than SJIBL. In this two year ratio indicates a higher ability to convert its asset into net
earnings than SJIBL and therefore it is an indicator of better managerial performance.

4.1.3 Return on Equity:

Year 2010 2011 2012 2013 2014
IBBL 19% 17% 13% 11% 9%
SJIBL 30.71% 13.80% 17.01% 12.67% 6.60%

Return on Equity(ROE)
35.00%
30.00%
25.00%
20.00%
15.00%
10.00%
5.00%
0.00%
2010 2011 2012 2013 2014
IBBL 19.00% 17.00% 13.00% 11.00% 9.00%
SJIBL 30.71% 13.80% 17.01% 12.67% 6.60%

Graph 3: Return on Equity(ROE)

Findings:Graph 3 shows that the ROE of IBBL is higher than the SJIBL every year except 2010.
One of the reasons of this Higher ROE is that IBBL is paying a very lower share in
profit for its depositors than the available deposit rate compared to the SJIBL.

4.1.4Price Earnings Ratio

Year 2010 2011 2012 2013 2014

IBBL 13.29 11.27 12.21 12.35 11.24
SJIBL 17.04 12.38 9.17 8.60 11.27

Price Earnings Ratio(Times)

18
16
14
12
10
8
6
4
2
0
2010 2011 2012 2013 2014
IBBL 13.29 11.27 12.21 12.35 11.24
SJIBL 17.04 12.38 9.17 8.6 11.27

Graph 4: Price Earnings Ratio (Times)

Findings:Graph 4 shows that P/E ratio of IBBL is slightly lower 2010, 2011, 2014. P/E ratio indicates
the how well the banks future earnings.one of the reasonsof the lower P/E is that IBBL is
paying very higher share for earnings. In 2012 & 2013 P/E of IBBL is higher than SJIBL.

4.1.5 Net Income Ratio

Year 2010 2011 2012 2013 2014
IBBL 14.81% 12.61% 10.67% 8.82% 6.89%

SJIBL 21.79% 9.73% 9.92% 8.36% 5.65%

 Net Income Ratio
25.00%

20.00%

15.00%

10.00%

5.00%

0.00%
2010 2011 2012 2013 2014
IBBL 14.81% 12.61% 10.67% 8.82% 6.89%
SJIBL 21.79% 9.73% 9.92% 8.36% 5.65%

Graph 5: Net Income Ratio

Findings:Graph 5 shows that net income ratio of IBBL is gradually higher except 2010 than
SJIBL. It means IBBL net income is higher than SJIBL. So, clients are eager to invest
their deposit in this bank.

4.1.6 Capital adequacy Ratio:

Year 2010 2011 2012 2013 2014

IBBL 11.06% 13.09% 13.49% 14.26% 12.83%

SJIBL 10.08% 11.4% 12.31% 13.69% 13.61%

Capital adequacy Ratio

16.00%
14.00%
12.00%
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
2010 2011 2012 2013 2014
IBBL 11.06% 13.09% 13.49% 14.26% 12.83%
SJIBL 10.08% 11.40% 12.31% 13.69% 13.61%

Graph 6: Capital adequacy Ratio

Findings:Graph 6 shows that CAR of IBBL is higher 2010-2013 than SJIBL. It means IBBL
has the greater the level of unexpected losses it can absorb before becoming insolvent.
But 2014 IBBL CAR is lower than SJIBL. In 2014 IBBL has lower risk than SJIBL.

4.1.7 Investment Deposit Ratio

Year 2010 2011 2012 2013 2014
IBBL 90.17% 89.47% 85.18% 82.35% 79.88%

SJIBL 96.34% 93.00% 89.64% 84.32% 80.82%

Investment Deposit Ratio

120.00%

100.00%

80.00%
Axis Title

60.00%

40.00%

20.00%

0.00%
2010 2011 2012 2013 2014
IBBL 90.17% 89.47% 85.18% 82.35% 79.88%
SJIBL 96.34% 93.00% 89.64% 84.32% 80.82%

Graph 7: Investment Deposit Ratio

Findings:Graph 7 shows that Investment Deposit Ratio of SJIBL is higher each year than IBBL.
Standard ratio of IDR is lower than 90%. IBBL’s IDR is standard for every year. In
2014 IBBL’s IDR is 79.88%. it is better in present perspective. On the other hand
SJIBL’s IDR was very higher in 2010. But recent year its IDR is very closely with
IBBL.
4.1.8 Debt Equity Ratio
Year 2010 2011 2012 2013 2014
IBBL 5.34 4.03 4.20 4.62 4.77

SJIBL 5.47 6.48 7.59 7.81 8.08

 Debt Equity Ratio(times)

9
8
7
6
5
4
3
2
1
0
2010 2011 2012 2013 2014
IBBL 5.34 4.03 4.2 4.62 4.77
SJIBL 5.47 6.48 7.59 7.81 8.08

Graph 8: Debt Equity Ratio (times)

Findings:Graph 7 shows thatdebt equity ratio of IBBL is better than SJIBL. Debt Equity ratio
show how many debt remain a company against debt. In every year IBBL Debt
Equity Ratio is increasing except 2010, 2011. Now IBBL Debt Equity Ratio is 4.77
whereas SJIBL Debt Equity Ratio is 8.08. It’s absolutely higher than IBBL.

4.1.9 Earning per share

Year 2010 2011 2012 2013 2014
IBBL 6.02 4.84 4.42 3.4 2.48

SJIBL 4.65 2.62 2.59 1.78 1.02

Earning per share(Taka)

7
6
5
4
3
2
1
0
2010 2011 2012 2013 2014
IBBL 6.02 4.84 4.42 3.4 2.48
SJIBL 4.65 2.62 2.59 1.78 1.02

Graph 9:Earning per share

Findings: Graph 9 shows that both banks earning per share is decreasing from 2010---2014.
IBBL earnings per share are higher than SJIBL. It means IBBL earnings per share are
better. One of reason for decreasing is unrest political condition and decreasing
national income. In 2014 IBBL Earnings Per share is 2.48 whereas SJIBL Earnings Per
share is 1.02 which is lower than IBBL.

4.1.10 Gross Profit Ratio:

Year 2010 2011 2012 2013 2014
IBBL 52% 52% 48% 45% 47%

SJIBL 51.01% 38.57% 35.95% 32.23% 37.93%

Gross Profit Ratio

60%

50%

40%

30%

20%

10%

0%
2010 2011 2012 2013 2014
IBBL 52% 52% 48% 45% 47%
SJIBL 51.01% 38.57% 35.95% 32.23% 37.93%

Graph 10:Gross Profit Ratio

Findings: Graph 10 shows that IBBL Gross profit ratio is higherthan SJIBL. In 2010 SJIBL Gross
profit ratio is approximately near the IBBL. From the next year it is very far from
IBBL. One of the reason IBBL operating income is higher than SJIBL.
4.2 vertical analysis
IBBL & SJIBL
Vertical Analysis Balance Sheet
For the year ended December 31, 2014 (Amount in million)

Particular IBBL SJIBL

% of Total % of Total
Asset Amount Amount
asset asset

Cash in hand 46,219 7.08% 8,470 6.68%

Balance with other banks & financial institutions 20,199 3.10% 7,643 6.03%

Placement with banks & other financial institutions 2,000 0.31% 4,234 3.34%

Investments in shares & securities 1,00,856 15.46% 7,308 5.77%

Investments 4,63,475 71.04% 84,062 66.34%

Fixed assets including premises 15,926 2.44% 3,165 2.5%

Other assets 3,744 0.57% 11,826 9.33%

Non-Banking asset -------- 0.00% 47 .04%

Total asset 6,52,419 100% 1,26,708 100%

Liabilities

Placement from banks & other financial institutions 1.17% 3251 2.56%
7,657
Deposits & other accounts 85.94% 98601 77.78%
560,696
Mudaraba perpetual bond 0.46% ------- 0.00%
3,000
Other liabilities 5.22% 13089 10.33%
34052
Deferred tax liabilities 0.06% 117 .09%
403397

Total liabilities 6,05,808 92.86% 115058 90.77%

Shareholders’ equity

Paid - up capital 16,099 2.47% 7346 5.8%

Statutory reserve 16,099 2.47% 3590 2.83%

Other reserves 11,998 1.84% ------- 0.00%

Retained Earnings 2,414 0.37% 760 .60%

Total stockholder equity 46,612 7.14% 11696 9.23%

Total liabilities & shareholders’ equity 6,52,418 100% 126754 100%

Table 1:Vertical Analysis Balance Sheet 2014

Findings: IBBL total asset is higher than SJIBL. IBBL cash is 7.08% of total asset whereas SJIBL
cash is 6.68%. Total liability of IBBL is 92.86% is higher than SJIBL (90.77%) of Total
liabilities & shareholders’ equity. Total equity of IBBL is 7.14% which is lower than
9.23%.
IBBL & SJIBL
Vertical Analysis Income Statement
For the year ended December 31, 2014 (In million Taka)
Particular IBBL SJIBL

Operating Income Amount % of net Amount % of net

sales sales

Investment income 49,109 266% 11364 360%

Profit paid on mudaraba deposits (30,650) (166%) 8209 260%

Net investment income 18459 100% 3156 100%

Income from investments in shares & securities 1900 10.29% 304 9.63%

Commission, exchange & brokerage income 5870 31.8% 1112 35.23%

Other operating income 1166 6.32% 444 14.07%

Total operating income 27935 148.41% 5016 158.9%

Operating expenses

Salary & allowances 8183 44.33% 1685 53.39%

Rent, taxes, insurances, electricity etc. 996 5.4% 342 10.84%

Legal expenses 16 0.09% 2 .06%

Postage, stamps and telecommunication etc. 47 0.25% 39 1.24%

Stationery, printing and advertisement etc. 317 1.72% 60 1.9%

Chief executive’s salary & fees 8 .04% 11 .35%

Directors’ fees & expenses 12 .07% 6 .19%

Shari’ah supervisory committee’s fees & expenses 2 .01% .2 .01%

Auditors’ fees 2 .01% .3 .01%

Charges on investment losses ----------- 0.00% -------- 0.00%

Depreciation and repair to bank’s assets 862 4.67% 140 4.44%

Zakat expenses 425 2.3% 92 2.92%

Other expenses 1200 6.5% 300 9.51%

Total operating expenses 12070 65.39% 2683 85.01%

Profit before provision 15325 83.02% 2333 73.92%

Provision for investments & off- balance sheet exposures 4670 25.30% 1525 48.32%

Provision for diminution in value of investments in shares 3 .016% 32 1.01%

Other provisions 117 .63% 0.00%

Total provision 4790 25.95% 1557 49.33%

Total profit before taxes 10535 57.08% 775 24.56%

Current tax (6323) 34.25% (48) 1.52%

Deferred tax expense/(income) (209) 1.13% (20) .63%

Net profit after tax 4003 21.69% 707 22.4%

Retained earnings from previous year 2634 14.27% 168 5.32%

Add: Net profit after tax 4003 21.69% 707 22.40%

Profit available for appropriation 6637 35.96% 875 27.73%

Table 2:Vertical Analysis Income statement 2014

Findings: Table 2 Shows that operating income of IBBL&SJIBL is respectively 148.41% & 158.9%
of the net investment income. Net profit of IBBL & SJIBL is respectively 21.69% &
22.40%. SJIBL net profit is higher than IBBL.
 IBBL & SJIBL
Vertical Analysis Balance Sheet
For the year ended December 31, 2013 (In million Taka)

Particular IBBL SJIBL

% of Total % of Total
Asset Amount Amount
asset asset

Cash in hand 44291 8.09% 10207 7.94%

Balance with other banks & financial institutions 12327 2.25% 3526 2.74%

Placement with banks & other financial institutions ------------ 0.00% 7782 6.05%

Investments in shares & securities 67211 12.28% 7221 5.61%

Investments 403194 73.68% 85706 66.67%

Fixed assets including premises 15732 2.87% 2955 2.3%

Other assets 4471 .82% 11155 8.68%

Non-Banking asset -------- 0.00% ---------- -----------

Total asset 5,47,229 100% 1,28,552 100%

Liabilities

Placement from banks & other financial institutions ------- 8300 6.46%
----------
Deposits & other accounts 86.52% 96481 75.05%
473140
Mudaraba perpetual bond 0.55% ------- ----------
3000
Other liabilities 4.96% 12683 9.87%
27133
Deferred tax liabilities 0.04% 137 0.11%
194

Total liabilities 503467 92.07% 117601 91.48%

Shareholders’ equity

Paid - up capital 14436 2.64% 6678 5.19%

Statutory reserve 14438 2.64% 3435 2.67%

Other reserves 11851 2.17% ------- ------------

Retained Earnings 2,634 0.48% 836 .65%

Total stockholder equity 43359 7.93% 10949 8.52%

Total liabilities & shareholders’ equity 546826 100% 128550 100%

Table 3
Findings: IBBL total asset is higher than SJIBL. IBBL cash is 8.09% of total asset whereas SJIBL
cash is 7.94%. Total liability of IBBL is 92.07% is higher than SJIBL (91.48%) of Total
liabilities & shareholders’ equity. Total equity of IBBL is 7.93% which is lower than 8.52%
of SJIBL.

IBBL & SJIBL

Vertical Analysis Income Statement
For the year ended December 31, 2013 (In million Taka)
Particular IBBL SJIBL

Operating Income Amount % of net Amount % of net

sales sales

Investment income 48145 280% 13614 448%

Profit paid on mudaraba deposits (30,975) 180% 10577 348%

Net investment income 17170 100% 3036 100%

Income from investments in shares & securities 2047 11.92% 229 7.54%

Commission, exchange & brokerage income 4969 28.94% 1364 44.92%

Other operating income 931 5.42% 399 13.14%

Total operating income 25117 146.28% 5031 165.71%

Operating expenses

Salary & allowances 7538 43.9% 1415 46.6%

Rent, taxes, insurances, electricity etc. 822 4.78% 319 10.5%

Legal expenses 35 0.20% .7 .02%

Postage, stamps and telecommunication etc. 44 0.25% 29 .95%

Stationery, printing and advertisement etc. 329 1.91% 64 2.1%

Chief executive’s salary & fees 7 0.04% 14 .46%

Directors’ fees & expenses 11 0.06% 6 .19%

Shari’ah supervisory committee’s fees & expenses 1 0.01% .45 .01%

Auditors’ fees 2 0.01% .35 .01%

Charges on investment losses ---------- --------- --------- --------

Depreciation and repair to bank’s assets 725 4.22% 134 4.13%

Zakat expenses 385 2.24% 76 2.5%

Other expenses 1134 6.60% 274 9.02%

Total operating expenses 11033 64.25% 2332.5 76.82%

Profit before provision 14084 82.02% 2698 88.88%

Provision for investments & off- balance sheet 3015 17.55% 174 5.73%
exposures

Provision for diminution in value of investments in .42 0.01% 64 2.1%

shares
Other provisions 13 0.07% 72 2.37%

Total provision 3028.42 17.63% 316 10.4%

Total profit before taxes 11056 64.39% 2382.5 78.47%

Current tax (6145) (35.78%) (1066) (35.11%)

Deferred tax expense/(income) 44 .25% (11) (.36%)

Net profit after tax 4954.96 28.85% 1305.5 43.00%

Retained earnings from previous year 3152 18.75% 8 .26%

Add: Net profit after tax 4954.96 28.85% 1305.5 43.00%

Profit available for appropriation 8106.96 47.21% 1313.5 43.26%

Table 4

Findings: Table 4 Shows that operating income of IBBL&SJIBL is respectively 146.28%&165.71%

of the net investment income. Net profit of IBBL & SJIBL is respectively 21.69% &
22.40%. SJIBL net profit is higher than IBBL.
 IBBL & SJIBL
Vertical Analysis Balance Sheet
For the year ended December 31, 2012 (In million Taka)

Particular IBBL SJIBL

% of Total % of Total
Asset Amount Amount
asset asset

Cash in hand 41774 8.65% 12803 9.63%

Balance with other banks & financial institutions 23048 4.77% 1316 .33%

Placement with banks & other financial institutions ------------ ------------ 9253 6.96%

Investments in shares & securities 27010 5.59% 5162 3.88%

Investments 372920 77.28% 96184 72.41%

Fixed assets including premises 14808 3.06% 2898 2.18%

Other assets 2974 0.61% 5203 3.91%

Non-Banking asset -------- ---------- -----------

Total asset 4,82,534 100% 1,28,552 100%

Liabilities

Placement from banks & other financial institutions 0.00% 14500 10.91%
----------
Deposits & other accounts 86.59% 102176 76.92%
417844
Mudaraba perpetual bond .62% ------- 0.00%
3000
Other liabilities 4.49% 6373 4.79%
21698
Deferred tax liabilities .04% 126 92.73%
238

Total liabilities 442780 91.76% 123175 92.74%

Shareholders’ equity

Paid - up capital 12509 2.59% 5565 4.18%

Statutory reserve 12423 2.57% 2959 2.22%

Other reserves 11694 2.42% ------- ----------

Retained Earnings 3127 .64% 1121 .84%

Total stockholder equity 39753 8.24% 9645 7.26%

Total liabilities & shareholders’ equity 482533 100% 128550 100%

Findings: Table 5 shows that IBBL total asset is higher than SJIBL. IBBL cash is 8.09% of total asset
whereas SJIBL cash is 7.94%. Total liability of IBBL is 92.07% is higher than SJIBL
(91.48%) of Total liabilities & shareholders’ equity. Total equity of IBBL is 7.93% which is
lower than 8.52% of SJIBL
IBBL & SJIBL
Vertical Analysis Income Statement
For the year ended December 31, 2012 (In million Taka)

Particular IBBL SJIBL

% of net % of net
Operating Income Amount Amount sales
sales

Investment income 43672 245% 15242 374%

Profit paid on mudaraba deposits 25870 145% 11169 274%

Net investment income 17802 100% 4073 100%

Income from investments in shares & securities 431 2.42% 133 3.26%
Commission, exchange & brokerage income 5249 29.48% 1642 40.31%

Other operating income 991 5.56% 421 10.33%

Total operating income 24,473 137.74% 6,269 153.91%

Operating expenses
Salary & allowances 5951 33.42% 1015 24.92%

Rent, taxes, insurances, electricity etc. 652 3.66% 264 6.48%

Legal expenses 13 .07% .7 .01%

Postage, stamps and telecommunication etc. 111 .62% 29 .71%

Stationery, printing and advertisement etc. 267 1.49% 68 1.66%

Chief executive’s salary & fees 5 .02% 14 .34%

Directors’ fees & expenses 10 .05% 5 .12%

Shari’ah supervisory committee’s fees & expenses 2 .01% .3 .01%

Auditors’ fees 2 .01% .3 .01%

Charges on investment losses ----------- 0.00% --------- 0.00%

Depreciation and repair to bank’s assets 500 2.8% 118 2.89%

Zakat expenses 324 1.8% 60 1.47%

Other expenses 1025 5.75% 244 5.99%

Total operating expenses 8862 49.78% 1818.3 44.64%

Profit before provision 15611 87.69% 4450.7 109.27%

Provision for investments & off- balance sheet exposures
3502 19.67% 650 15.95%

Provision for diminution in value of investments in shares ----------- 0.00% 42 1.03%

Other provisions 9 .05% 100 2.45%
Total provision 3511 19.72% 912 22.39%
Total profit before taxes 12100 67.96% 3538.7 86.88%
Current tax (6525) 36.65% (1786) 43.84%
Deferred tax expense/(income) (45) .25% (18) (.44%)
Net profit after tax 5530 31.06% 1734.7 42.59%
Retained earnings from previous year 3202 17.98% 98 2.40%
Add: Net profit after tax 5530 31.06% 1734.7 42.59%
Profit available for appropriation 8732 49.05% 1832.7 44.99%

Findings: Table 6 Shows that operating income of IBBL&SJIBL is respectively 137.74%&153.91%

of the net investment income. Net profit of IBBL & SJIBL is respectively 31.06% &
42.59%. SJIBL net profit is higher than IBBL.

IBBL & SJIBL

Vertical Analysis Balance Sheet
For the year ended December 31, 2011 (In million Taka)

Particular IBBL SJIBL

% of Total % of Total
Asset Amount Amount asset
asset
Cash in hand 40631 10.43% 9498 8.85%

Balance with other banks & financial institutions 15577 4.00% 1439 1.34%

Placement with banks & other financial institutions --------- ----------- 6835 6.37%

Investments in shares & securities 16932 4.35% 3376 3.14%

Investments 305840 78.58% 80592 75.16%

Fixed assets including premises 7100 1.82% 1525 1.42%

Other assets 3109 .79% 3960 3.69%

Non-Banking asset --------- ---------- ---------- ----------

Total asset 3,89,189 100% 1,07,225 100%

Liabilities
Placement from banks & other financial institutions ---------- --------- 10770 10.04%
Deposits & other accounts 341853 83350 77.73%
87.83%
Mudaraba perpetual bond 3000 ------------- ----------
0.77%
Other liabilities 16345 5084 4.74%
4.19%%
Deferred tax liabilities 192 107 .09%
0.04%
Total liabilities 361390 92.86% 9931 92.62%

Shareholders’ equity
Paid - up capital 10007 2.57% 4452 4.15%

Statutory reserve 10004 2.57% 2252 2.1%

Other reserves 4585 1.17% ------------- -----------

Retained Earnings 3202 .82% 1212 1.13%

Total stockholder equity 27798 7.14% 7916 7.38%

Total liabilities & shareholders’ equity 389188 100% 107227 100%

Findings: Table 7 shows that IBBL total asset is higher than SJIBL. IBBL cash is 10.43% of total
asset whereas SJIBL cash is 8.85%. Total liability of IBBL is 92.07% is higher than SJIBL
(91.48%) of Total liabilities & shareholders’ equity. Total equity of IBBL is 7.93% which is
lower than 8.52% of SJIBL
IBBL & SJIBL
Vertical Analysis Income Statement
For the year ended December 31, 2011 (In million Taka)

Particular IBBL SJIBL

% of net % of net
Operating Income Amount Amount sales
sales
Investment income 32019 235.12% 10107 370.08%

Profit paid on mudaraba deposits 18401 135.12% 7376 270.08%

Net investment income 13618 100% 2731 100%
Income from investments in shares & securities 289 2.12% 112 4.10%
Commission, exchange & brokerage income 5284 38.80% 1473 53.93%
Other operating income 808 5.93% 312 11.42%
Total operating income 19999 146.85% 4628 169.46%

Operating expenses
Salary & allowances 4646 34.11% 943 34.52%
Rent, taxes, insurances, electricity etc. 503 3.69% 212 7.76%
Legal expenses 15 0.11% 0.8 0.02%
Postage, stamps and telecommunication etc. 94 0.69% 27 0.98%
Stationery, printing and advertisement etc. 198 1.45% 40 1.46%
Chief executive’s salary & fees 5 0.03% 12 0.43%
Directors’ fees & expenses 9 0.06% 4 0.14%
Shari’ah supervisory committee’s fees & expenses 2 0.01% 0.1 0.01%
Auditors’ fees 1 0.01% 0.3 0.01%
Charges on investment losses ----------
---------- ---------- ----------
Depreciation and repair to bank’s assets 407 2.98% 114 4.17%
Zakat expenses 262 1.92% 59 2.16%
Other expenses 1121 8.23% 217 7.94%
Total operating expenses 7263 53.33% 1629.2 59.65%
Profit before provision 2998.8
12736 93.52% 109.80%

Provision for investments & off- balance sheet exposures 130

2384 17.50% 4.76%

Provision for diminution in value of investments in shares 180

0 0 6.59%

Other provisions 237

0 0 28.67%

Total provision 610

2384 17.50% 22.33%

Total profit before taxes 2388.8

10352 76.01% 87.46%

Current tax (1188)

(5476) (40.21%) (43.5%)

Deferred tax expense/(income) 30 1.09%

(29) (0.21%)

Net profit after tax 1230.8

4847 35.59% 45.06%

Retained earnings from previous year 521

2594 19.04% 19.07%

Add: Net profit after tax 1230.8

4847 35.59% 64.14%

Profit available for appropriation 1751

7441 54.64% 45.06%

Findings: Table 8 Shows that operating income of IBBL&SJIBL is respectively 146.85%&169.46%

of the net investment income. Net profit of IBBL & SJIBL is respectively 35.59%
&45.06%. SJIBL net profit is higher than IBBL.
 IBBL & SJIBL
Vertical Analysis Balance Sheet
For the year ended December 31, 2010 (In million Taka)

Particular IBBL SJIBL

% of Total % of Total
Asset Amount Amount asset
asset
Cash in hand 39053 11.81% 7199 9.16%
Balance with other banks & financial institutions 6679 2.02% 1,157 1.47%
Placement with banks & other financial institutions ------------ 0 4,336 5.51%
Investments in shares & securities 12268 3.71% 2,522 3.20%
Investments 263225 79.62% 61,440 78.19%
Fixed assets including premises 6748 2.04% 1,472 1.87%
Other assets 2610 0.78% 446 0.56%
Non-Banking asset 0 0 0 0
Total asset 3,30,583 100% 78,572 100%

Liabilities
Placement from banks & other financial institutions -------------- ------------ 5,732 7.31%
Deposits & other accounts 2,91,934 88.30% 62,514 79.79%
Mudaraba perpetual bond 3000 0.90% ---------- ---------
Other liabilities 11,994 3.62% 3278 4.18%
Deferred tax liabilities 162 0.04% 76 .09%
Total liabilities 307,090 92.89% 71600 91.39%

Shareholders’ equity
Paid - up capital 7,413 2.24% 3425 4.31%
Statutory reserve 7,934 2.40% 1774 2.26%
Other reserves 5,551 1.67% ---------- ----------
Retained Earnings 2,594 0.78% 1548 1.97%
Total stockholder equity 23,492 7.11% 6747 8.61%
Total liabilities & shareholders’ equity 330,582 100% 78,347 100%

Table 9
Findings: Table 9 shows that IBBL total asset is higher than SJIBL. IBBL cash is 10.43% of total
asset whereas SJIBL cash is 8.85%. Total liability of IBBL is 92.07% is higher than SJIBL (91.48%)
of Total liabilities & shareholders’ equity. Total equity of IBBL is 7.93% which is lower than 8.52%
of SJIBL
Horizontal Analysis

Islami Bank Bangladesh Limited

Horizontal Analysis Balance Sheet
For the years ended December 31, 2014, 2013
(In million Taka)

Particular Years Increase or decrease

Asset 2014 2013 Amount Percentage

Cash in hand 46,219 44291

1,928 4.35%

Balance with other banks & financial institutions 20,199 12327

7,872 63.85%

Placement with banks & other financial institutions 2,000 -----------

2,000 0

Investments in shares & securities 1,00,856 67211

33,645 50.05%

Investments 4,63,475 403194

60,281 14.95%

Fixed assets including premises 15,926 15732

194 1.23%

Other assets 3,744 4471

(727) (16.26%)

Non-Banking asset -------- --------

0 0

Total Asset 6,52,419 5,47,229

105,190 19.22%

Liabilities

Placement from banks & other financial institutions

7,657 ---------- 7,657 0.00%
Deposits & other accounts
560,696 473140 87,556 18.50%
Mudaraba perpetual bond
3,000 3000 0 0.00%
Other liabilities
34052 27133 6,919 25.50031
Deferred tax liabilities
403397 194 403,203 207836.6

Total liabilities 6,05,808 503467

102,341 20.32725
Shareholders’ equity

Paid - up capital 16,099 14436

1,663 11.51%

Statutory reserve 16,099 14438

1,661 11.50%
Other reserves 11,998 11851
147 1.24%

Retained Earnings 2,414 2,634

(220) (8.35%)

Total stockholder equity 46,612 43359

3,253 7.50%

Total liabilities & shareholders’ equity 6,52,418 546826

105,592 19.30%

Islami Bank Bangladesh Limited

Horizontal Analysis Income Statement
For the years ended December 31, 2014, 2013 (In million Taka)

Particular Years Increase or decrease

Operating Income 2014 2013 Amount Percentage

Investment income 49,109 48145 964 2.00%

Profit paid on mudaraba deposits (30,650) (30,975) 325 1.04%

Net investment income 18459 17170 1,289 7.50%

Income from investments in shares & securities 1900 2047 (147) (7.18%)

Commission, exchange & brokerage income 5870 4969 901 18.13%

Other operating income 1166 931 235 25.24%

Total operating income 27935 25117 2,818 11.21%

Operating expenses

Salary & allowances 8183 7538 645 8.55%

Rent, taxes, insurances, electricity etc. 996 822 174 21.16%

Legal expenses 16 35 (19) (54.28%)

Postage, stamps and telecommunication etc. 47 44 3 6.81%

Stationery, printing and advertisement etc. 317 329 (12) (3.64%)

Chief executive’s salary & fees 8 7 1 14.28%

Directors’ fees & expenses 12 11 1 9.09%

Shari’ah supervisory committee’s fees & 1 1 100%
2
expenses
Auditors’ fees 2 2 0 0%
Charges on investment losses ----------- ---------- ------------- ------------

Depreciation and repair to bank’s assets 862 725 137 18.89%

Zakat expenses 425 385 40 10.38%

Other expenses 1200 1134 66 5.82%

Total operating expenses 12070 11033 1,037 9.39%

Profit before provision 15325 14084 1,241 8.81%

Provision for investments & off- balance sheet
4670 3015 1,655 54.89%
exposures
Provision for diminution in value of investments
3 .42 2.58 614.28%
in shares
Other provisions 117 13 104 800%
Total provision 4790 3028.42 1,762 58.16%
Total profit before taxes 10535 11056 (521) (4.71%)
Current tax (6323) (6145) (178) (2.89%)
Deferred tax expense/(income) (209) 44 (253) (575%)
Net profit after tax 4003 4954.96 (952) (19.21%)
Retained earnings from previous year 2634 3152 (518) (16.434%)
Add: Net profit after tax 4003 4954.96 (952) (19.21%)
Profit available for appropriation 6637 8106.96 (1,470) (18.13%)

Islami Bank Bangladesh Limited

Horizontal Analysis Balance Sheet
For the years ended December 31, 2013, 2012 (In million Taka)

Particular Years Increase or decrease

Asset 2013 2012 Amount Percentage

Cash in hand 44291 41774 2,517 6.02%

Balance with other banks & financial institutions 12327 23048 (10,721) (46.516%)

Placement with banks & other financial institutions ------------ ----------- ------------ ------------

Investments in shares & securities 67211 27010 40,201 148.83%

Investments 403194 372920 30,274 8.11%

Fixed assets including premises 15732 14808 924 6.23%

Other assets 4471 2974 1,497 50.33%

Non-Banking asset -------- -------- ---------- ---------------

Total Asset 5,47,229 4,82,534 64,695 13.40%

Liabilities
Placement from banks & other financial institutions ---------- ---------- ---------- ------------
Deposits & other accounts 473140 417844 55,296 13.23%
Mudaraba perpetual bond 3000 3000 0 0
Other liabilities 27133 21698 5,435 25.04%
Deferred tax liabilities 194 238 -44 (18.48%)

Total liabilities 503467 442780 60,687 13.70%

Shareholders’ equity

Paid - up capital 14436 12509 1,927 15.40%

Statutory reserve 14438 12423 2,015 16.21%

Other reserves 11851 11694 157 1.34%

Retained Earnings 2,634 3127 (493) (15.76%)

Total stockholder equity 43359 39753 3,606 9.07%

Total liabilities & shareholders’ equity 546826 482533 64,293 13.32%

Islami Bank Bangladesh Limited

Horizontal Analysis Income Statement
For the years ended December 31, 2013, 2012 (In million Taka)

Particular Years Increase or decrease

Operating Income 2013 2012 Amount Percentage

Investment income 48145 43672
4,473 10.24%
Profit paid on mudaraba deposits (30,975) (25870)
(5105) 19.73%
Net investment income 17170 17802 (632) (3.55%)
Income from investments in shares & securities 2047 431
1,616 374.94%
Commission, exchange & brokerage income 4969 5249 (280) (5.33%)
Other operating income 931 991
(60) (6.05%)
Total operating income 25117 24,473 644 2.63%
Operating expenses

Salary & allowances 7538 5951 1,587 26.66%

Rent, taxes, insurances, electricity etc. 822 652
170 26.07%
Legal expenses 35 13 22 169.23%
Postage, stamps and telecommunication etc. 44 111
(67) (60.36%)
Stationery, printing and advertisement etc. 329 267 62 23.22%
Chief executive’s salary & fees 7 5
2 40.00%
Directors’ fees & expenses 11 10
1 10.00%
Shari’ah supervisory committee’s fees & 2
1
expenses -1 (50.00%)
Auditors’ fees 2 2 0 0
Charges on investment losses ---------- -----------
------------- ------------
Depreciation and repair to bank’s assets 725 500 225 45%
Zakat expenses 385 324
61 18.82%
Other expenses 1134 1025
109 10.63%
Total operating expenses 11033 8862 2,171 24.49%
Profit before provision 14084 15611 (1,527) (9.78%)
Provision for investments & off- balance sheet
3015 3502
exposures (487) (13.9063)
Provision for diminution in value of investments
.42 ----------- --------- --------------
in shares
Other provisions 13 9
4 44.44%
Total provision 3028.42 3511 (483) (13.74%)
Total profit before taxes 11056 12100 -1,044 -8.6281
Current tax (6145) (6525)
380 (5.82%)
Deferred tax expense/(income) 44 (45) 89 (19%)
Net profit after tax 4954.96 5530 (575) (10.39%)
Retained earnings from previous year 3152 3202 (50) (1.56%)
Add: Net profit after tax 4954.96 5530
(575) (10.39%)
Profit available for appropriation 8106.96 8732 (625) (7.15%)

Islami Bank Bangladesh Limited

Horizontal Analysis Balance Sheet
For the years ended December 31, 2012, 2011 (In million Taka)

Particular Years Increase or decrease

Asset 2012 2011 Amount Percentage

Cash in hand 41774 40631 1,143 2.81%

Balance with other banks & financial institutions 23048 15577
7,471 47.96%

Placement with banks & other financial institutions ----------- ----------- ---------

Investments in shares & securities 27010 16932

10,078 59.52%
Investments 372920 305840 67,080 (21.93)
Fixed assets including premises 14808 7100
7,708 (108.56)
Other assets 2974 3109
(135) (4.34%)
Non-Banking asset -------- ----------- ------------
Total Asset 4,82,534 3,89,189 93,345 23.98%
Liabilities
Placement from banks & other financial institutions ---------- ---------- ------------
-------------
Deposits & other accounts 417844 341853
75,991 22.22%
Mudaraba perpetual bond 3000 3000
0 0
Other liabilities 21698 16345
5,353 32.75%
Deferred tax liabilities 238 192
46 23.95%
Total liabilities 442780 361390 81,390 22.52%
Shareholders’ equity

Paid - up capital 12509 10007

2,502 25.00%
Statutory reserve 12423 10004
2,419 24.18%
Other reserves 11694 4585
7,109 155.04%
Retained Earnings 3127 3202
(75) (2.34%)
Total stockholder equity 39753 27798 11,955 43.00%
Total liabilities & shareholders’ equity 482533 389188 93,345 23.98%

Islami Bank Bangladesh Limited

Horizontal Analysis Income Statement
For the years ended December 31, 2012, 2011(In million Taka)

Particular Years Increase or decrease

Operating Income 2012 2011 Amount Percentage

Investment income 43672 32019

11,653 36.39%
Profit paid on mudaraba deposits (25870) (18401)
(7,469) 40.59%
Net investment income 17802 13618 4,184 30.72%
Income from investments in shares & securities 431 289 142 49.13%
Commission, exchange & brokerage income 5249 5284
(35) (0.66%)
Other operating income 991 808 183 22.64%
Total operating income 24,473 19999 4,474 22.37%
Operating expenses

Salary & allowances 5951 4646 1,305 28.08%

Rent, taxes, insurances, electricity etc. 652 503
149 29.62%
Legal expenses 13 15
(2) (13.33%)
Postage, stamps and telecommunication etc. 111 94
17 18.08%
Stationery, printing and advertisement etc. 267 198 69 34.84%
Chief executive’s salary & fees 5 5
0 0
Directors’ fees & expenses 10 9 1 11.11%
Shari’ah supervisory committee’s fees & 2 2
expenses 0 0
Auditors’ fees 2 1 1 100%
Charges on investment losses ----------- ----------
------------ -----
Depreciation and repair to bank’s assets 500 407 93 22.85%
Zakat expenses 324 262
62 23.66%
Other expenses 1025 1121 (96) (8.56%)
Total operating expenses 8862 7263 1,599 22.01%
Profit before provision 15611 12736 2,875 22.57%
Provision for investments & off- balance sheet
3502 2384
exposures
1,118 46.89%
Provision for diminution in value of investments
----------- 0 ---------- -----------
in shares
Other provisions 9 0 9 0
Total provision 3511 2384 1,127 47.27%
Total profit before taxes 12100 10352 1,748 16.88%
Current tax (6525) (5476) (1,049) 19.15%
Deferred tax expense/(income) (45) (29) (16) 55.17%
Net profit after tax 5530 4847 683 14.09%
Retained earnings from previous year 3202 2594 608 23.43%
Add: Net profit after tax 5530 4847 683 14.09%
Profit available for appropriation 8732 7441 1,291 17.34%

Islami Bank Bangladesh Limited

Horizontal Analysis Balance Sheet
For the years ended December 31, 2011, 2010 (In million Taka)

Particular Years Increase or decrease

Asset 2011 2010 Amount Percentage

Cash in hand 40631 39053

1,578 4.04%
Balance with other banks & financial institutions 15577 6679
8,898 133.22%
Placement with banks & other financial institutions ----------- ----------- ----------- -------------
Investments in shares & securities 16932 12268
4,664 38.01%
Investments 305840 263225
42,615 16.18%
Fixed assets including premises 7100 6748
352 5.21%
Other assets 3109 2610
499 19.11%
Non-Banking asset ------------ ----------- ----------- -----------
Total Asset 3,89,189 3,30,583 58,606 17.72%
Liabilities
Placement from banks & other financial institutions ---------- ----------- ----------- -----------
Deposits & other accounts 341853 2,91,934 49919 17.09%
Mudaraba perpetual bond 3000 3000
0 0
Other liabilities 16345 11,994 4,351 36.27%
Deferred tax liabilities 192 162
30 18.51%
Total liabilities 361390 307,090
54,300 17.68%
Shareholders’ equity
Paid - up capital 10007 7,413 2,594 34.99%
Statutory reserve 10,004 7,934 2,070 26.09%
Other reserves 4585 5,551 (966) (17.40%)
Retained Earnings 3202 2,594 608 23.43%
Total stockholder equity 27798 23,492 4,306 18.32%
Total liabilities & shareholders’ equity 389188 330,582 58,606 17.72%

3.3 Trend Analysis

3.3.1 Asset

700000

600000

500000

400000
IBBL
300000 SJIBL

200000

100000

0
2010 2011 2012 2013 2014

3.3.2 Liability

700,000

600,000

500,000

400,000
IBBL
300,000 SJIBL

200,000

100,000

0
2010 2011 2012 2013 2014

3.3.3 Equity
50,000

45,000

40,000

35,000

30,000

25,000 IBBL
SJIBL
20,000

15,000

10,000

5,000

0
2010 2011 2012 2013 2014

Chapter 4
 Recommendation & conclusion

6.1 Recommendation

Current ratio of IBBL is lower from 2010-2014 than SJIBL. IBBL should increase their asset
against liability.
ROA of IBBL is lower except 2011 & 2014 than SJIBL. IBBL should incease their total asset
sothat they can return asset into net earnings.