i

Introduction
1.1 Objectives of the Study
The objective of the study is to find out whether there is statistical relationship between the sales of credit cards and other factors such as debit card sales, new deposit accounts, new loan accounts, direct sales team or permanent staff number etc. This study will attempt to establish a linear model between the variables and hence will try to quantify the relationship in a linear equation. Various other tests will be done in an attempt to identify a proper statistical relationship.

1.2

Significance of the Study

The study is primarily an internship report but still it will be aimed at helping the

management to identify the factors that influence the credit card sales. The statistical relationship will help to determine which factors are most important so that the management can focus on those factors. Understanding these factors will be key to success of E !"s credit cards in the face of huge competition. #oreover the study will help my faculty to understand the factors that influence credit card purchase behavior in relation to other factors of the bank.

1.3

Methodology
The study is primarily based on secondary data collected from the $onsumer

anking division of E !. Every month an internal #%& report is created so that performance of each branch can be measured. These data have been used in this report. The data is of #ay
1

'((). *dditionally for technical reference, some websites have been quoted in the report which will help to further clarify the statistical relationship.

1.4

Limitations of the Study

The major limitation of the study is that it does not have any primary data. *ll data

have been collected from $onsumer anking division, which have been originally collected for a different purpose. &econdly, there might be other factors than the variables mentioned in the report that can affect credit card sales. &o those variables may be important but might skip this report. &o this is another major limitation.

Organizational Part

Overvie of the !an"

1.# $istory and !ac"ground of %astern !an" Limited
The emergence of Eastern ank !imited in the private sector is an important event in the banking industry of angladesh. Eastern ank !imited started its business as a public

limited company on *ugust ), +,,' with the primary objectives to carry on all kinds of banking business in and outside of angladesh and also with a view to safeguard the interest of the depositors of erstwhile $$% - ank of $redit and $ommerce %nternational -.verseas// under the 0econstruction &cheme, +,,', framed by angladesh ank.

%n +,,+, when been closed

$$% had collapsed internationally, the operation of this bank had $$% employees and taking into

angladesh. *fter a long discussion with the

consideration the depositors" interest, angladesh ank then gave permission to form a bank named Eastern ank !imited which would take over all the assets, cash and liabilities of

erstwhile $$% in angladesh, with effect from +1th *ugust +,,'. &o, it can be said that E ! is a successor of $$%.

Eastern ank !imited -E !/ is a second generation commercial bank with ', online branches across major cities in angladesh and 1+' full time employees on year end '((2. %t offers full range of commercial banking products and services to the corporate, mid3market and retail segment. Under the corporate banking segments the ank has comprehensive range of financial products including corporate deposit accounts, syndicated financing, e4port3 import financing, working capital and other finance, bonds and guarantees, investment and
4

business counseling, infrastructure finance, cash management services etc. 5ith urban banking focus, the ank is offering various alternative delivery channels like *T#s, ills

6ay #achines, 7iosks, and %nternet

anking etc. The bank has set up a brand image

attributable in part to its policy of continuous customer service e4cellence, innovative products and services and ma4imum technology utili8ation. Unlike conventional branch banking, credit proposals as well as business operations are processed centrally at E !. esides #ain .peration, E ! has an .ffshore anking Unit -. U/ set up in '((9 which

gives loans and takes deposits only in freely convertible foreign currency to and from non resident person:institutions, fully foreign owned E6; companies etc.

1.&

%!L's (ision)
E !"s vision is to become the !an" of *hoice by transforming the ay it does

business and developing a truly unique financial institution that delivers su+erior gro th , financial +erformance and be the most -ecogni.able !rand in the financial services in angladesh.

E ! dreams to become the bank of choice of the general public which includes both the consumer and the corporate clients. They want to build such an image that whenever people will think of a bank, they will think of Eastern ank. %n order to build up such an

image, E ! has taken up some attractive promotional campaign with the professional help of Unitrend !td. They are targeting the young generation in particular because research has shown that people usually have a soft corner for the first bank of their lives and tend to stick to it if they are satisfied with its service. 5ith this plan in mind, E ! is trying to project itself
5

as a vibrant and dynamic organi8ation by introducing state3of3the3art banking technology which will make banking easier and hassle3free to the young generation. %t has adopted the tag line <&imple math, the philosophy of easy banking= and also adopted a new logo which looks very dynamic in its attractive colors. The blue, gold and green colors of the logo reflect all the changes that are taking place in E !. %n the words of E !"s promotional literatures, <Eastern ank !imited, the inspiration of change is happening now>the vibrant green of

mother earth, a blue sky full of possibilities and a yellow rising sun of hope comes together for a new face of E !.= %n order to achieve superior growth ? financial performance for its shareholders, E ! is radically transforming the way it does business. *lready the bank has restructured from the traditional geographical matri4 -branch3based banking/ to business unit matri4. The restructuring program is discussed in detail in the later sections. The bank is also centrali8ing most of the business functions in the head office to ensure greater control and efficiency.

1./

%!L's Mission)

%n line with its vision, E ! has developed a mission statement which reads as follows and is self3e4planatory@ To deliver service e4cellence to all its customers, both internal ? e4ternal. To constantly challenge its systems, procedures ? training to maintain a cohesive and professional team in order to achieve service e4cellence. To create an enabling environment and embrace a team based culture where people will e4cel. To ensure to ma4imi8e shareholders value.
6

1.0

1resent !usiness 1hiloso+hy)

The philosophy of the present management of E ! is to develop the ank into an

ideal and unique banking institution. The perception is that E ! should be quite different from other privately owned and managed commercial bank operating in angladesh. E ! is to grow as a leader in the industry rather than a follower. The leadership will be in the area of serviceA constant effort being made to add new dimension so that clients can get Bsomething additionalB in the matter of services to commensurate with the needs and requirements of the countryCs growing society and developing economy. Till '(((, E ! was operating in a Deographical #atri4 where the business of the bank was concentrated in the '' branches divided into 8ones. ut in '((+, the new dynamic

management of E ! led by the #anaging Eirector #r. %ftekhar has changed the Deographic #atri4 into usiness #atri4. The bank has been restructured into three main businesses

which are responsible for earning the incomes of the bank. These are@ $orporate anking $onsumer anking Treasury *ll other departments of the bank act as support units for these F units and help them in every possible way. Under this arrangement, the responsibilities and functions of the branches have been reduced dramatically. #any of the activities like credit evaluation ? approval, monitoring of loans, trade services activities etc. are now centrali8ed in the Gead .ffice. The branches of the bank are now termed as the 2Sales , Service *enters3 which are solely concentrated on delivering services to the corporate and consumer clients and maintain relationship with them.

1.4

Management 5s+ects)
!ike any other business organi8ation, all the major decisions in E ! are made by the

top management. The board of directors being at the highest level of organi8ational structure plays an important role in policy formulation. The board of directors is not directly concerned with the day3to3day operation of bank. They have delegated this duty to the management committee. The board mainly establishes the objectives and policies of the bank. There are three -F/ committee of the board for different purposes@ +. '. F. E4ecutive committee comprising of 2 members of the boardA $ommittee of the board for *dministrative matter, $ommittee to e4amine ad !oan $ases. The $hief E4ecutive .fficer -$E./, who is assisted by F E4ecutive Vice 6residents -EV6s/, looks after the day3to3day affairs of the ank. Guman 0esource Eepartment, #Es

&ecretariat and *udit and $ompliance Eepartment are under direct control of the $E.. The three EV6s are in charge of .perations, $redit and $orporate anking respectively. They

control the affairs of these departments through the managers who are in charge of various departments under these divisions.

#id and lower level employees get the direction and instruction from the top e4ecutives about the duties and tasks they have to perform. #anagement of Eastern ank !td. assumes that employees are members of the team, who actively participate in accomplishing the organi8ation goal. The chief e4ecutive provides the guideline and broad direction to the managers and employees but delegates" responsibility for determining how tasks and goals are to be accomplished. The present top management is as follows@

H H H H H H H

#r *li 0e8a %ftekhar 3 #r #ahbubul *lam Tayiab 3 #r #amoon #ahmood &hah3 #r. #ukhlesur 0ahman3 #r ;aglul *bbas 3 #r #d. Iakrul *lam3 #d. &irajul %slam 3

#anaging Eirector ? $E. E4ecutive Vice 6resident ? Gead of .p. &enior E4ecutive Vice 6resident ? E#E &enior E4ecutive Vice 6resident ? E#E EV6 ? Gead of $redit 0isk #anagement E4ecutive Vice 6resident Gead of Guman 0esources 3

The management hierarchy of Eastern ank !imited is given below@

CHAIRMAN

BOARD OF DIRECTORS

MANAGING DIRECTOR

EXECUTIVE VICE PRESIDENT

SENIOR VICE PRESIDENT

VICE PRESIDENT

SENIOR ASSISTANT VICE PRESIDENT

FIRST ASSISTANT VICE PRESIDENT

ASSISTANT VICE PRESIDENT

SENIOR PRINCIPA' OFFICER

PRINCIPA' OFFICER

SENIOR OFFICER

OFFICER

Figure

! Manage"ent Hierar#$% o& EB'

1.4.1 $orporate

*or+orate !an"ing 6ivision) anking Eivision came into e4istence because of the restructuring of

E !"s business processes. 6reviously all the loan disbursement and monitoring activities were carried out by the officers of individual branches, which resulted in poor management and control of the process. To check this trend, E ! decided to centrali8e its loan disbursement and monitoring activities in line with the model followed by the foreign banks in the country. *s such, E ! was the first private commercial bank in the country to have a separate $orporate anking Eivision which started operation on +(th January of '(('. This

division is responsible for bringing in profitable new corporate clients and retaining present clients by meeting their various needs. $orporate anking delivers banking services like

products, credit facilities, tailored financial solution to the specific needs of clients, resolves credit issues, and develops the relationship between the clients and the bank. *t present, corporate anking Eivision is the main revenue earner of E !, generating about 2(K of the total revenue.
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The whole corporate division is divided into two broad areas, *rea + that comprises of Ehaka and .utstation ranches and *rea ' comprising of $hittagong branches. *rea +

consists of si4 relationship units. Iive units in *rea + are looking after the bank"s assets -loans and advances/ and one unit is responsible for liabilities, while *rea ' has three asset units and one liabilities unit. Every asset unit has a unit head, who is in charge of that unit and responsible for all the business activities of that unit. Denerally one 0elationship #anager -0#/ and one *ssociate 0elationship #anager -*0#/ work under the Unit Gead. *ll Unit heads work under the Gead of $orporate, and they report directly to him. The management hierarchy of the $orporate anking Eivision is given below@

Head of Corporate

Unit Head

Relationship Manager

Associate Relationship Manager

7igure 3) Management $ierarchy of *or+orate !an"ing

8he broad functions of this division are as follo s) Targeting corporate clients and building business relationship with them
11

Eesigning customi8ed service for the clients Evaluating financial strength of the clients #aking possible recommendations for further financial e4pansion

1.4.2

*redit -is" Management and 5dministration) The primary objective of this division is to evaluate the credit worthiness and debt

payment capability of present loan customers and loan applicants. The respective branches send all loans and advances proposals from the prospective borrowers to the Gead office $redit 0isk #anagement -G.$0#/ for an approval. %f this department finds the loan proposal attractive, it either approves it or sends it for board approval. %t is also responsible for keeping track of the credit portfolio by obtaining regular information from the branches. %t sets prices for credits and ensures affecting it at the branches. This department also monitors the various loan accounts of the branches and prepares various statements for ank. The $redit 0isk #anagement Eepartment is assisted by the $redit *dministration Eepartment, which is mainly concerned with the post3approval functions of the division. The aspects that are critically tracked and monitored by $redit *dmin are $redit e4piry 6ast dues E4cess over limit Eocument deficiency 0eporting angladesh

12

$redit *dministration is involved in basically ' broad functions@ !oan #onitoring Eocumentation

Loan Monitoring: The important aspects of this part are@ Iollow approval terms 6roper loan disbursement #onitor interest payments #onitor principal repayment alance with general ledger

Documentation: The important functions of this part are@ !ook at sanction terms Iill up loan documentation checklist Ensure 6roper loan documentation .btain client sign off Iiling with the 0egistered Joint &tock $orporation - 0J&$/ 0egistered mortgage deed e4ecution

1.4.3

*onsumer !an"ing 6ivision)

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The mission of $onsumer

anking is to serve individual customer throughout every

stage of their life stage. The consumer banking activities are being carried out through the ', branches of Eastern ank !imited operating countrywide. *mong these branches +L branches are located in Ehaka, 1 in $hittagong, 9 in &ylhet and + each in 7hulna, Jessore, ogra and 0ajshahi. 6reviously these branches used to conduct all kind of business activities, including processing credit issue, conducting trade service, consumer service etc. ut after the

restructuring process, all these branches are now mainly focusing only on delivering service to individual and corporate customers and are therefore termed as <&ales ? &ervices $enters=. *t present, E ! does not have too many attractive consumer products, and therefore this division is producing only +LK of the total revenue. Gowever, E ! has decided to give more focus on consumer banking and is developing modern delivery channels like *T#s, tele3banking, internet banking, credit cards, etc. and many other new consumer products and services to meet specific financial demands of the customers as well as to make their life easy ? convenient. 8he broad functions of this division are) &ettlement of accounts uilding strong relationship with individual customers

%dentifying individual needs of the customers and thus helping design products that will meet their needs. 6roviding locker services 6roviding ancillary services

1.4.4

$uman -esources 6ivision)

14

The employees are Eastern

ank"s most valuable resource. Gaving competent and

professional employees is becoming increasingly important in today"s competitive world, and E ! has a significant competitive advantage in this respect. #any of its employees have worked here since the $$% area and therefore have vast e4perience in their respective fields. *lso the new employees are recruited with sound academic background and given proper training after recruitment to groom up for their responsibilities.

The #ission of G0 Eivision is to make E ! the Employer of Choice. They plan to inculcate a high performance culture where the employees will work with fun and pride. The broad functions of this division are@

!uilding %m+loyer Image) The G0 department has taken steps in building relationship with recogni8ed educational institutes in order to create positive awareness about E ! as an employer. This is being done by e4tending internships to students, sponsoring student events and by participating in job fairs run by different universities.

Staffing) *nother important task of the G0 division is to prepare all formalities regarding appointment and joining of the successful candidates.

8raining) G0 department emphasi8es on training and development in order to minimi8e the knowledge and skill gaps and enhance business awareness among the bank employees. To this effect, this department arranges various training programs for the bank employees both at
15

the

ank"s own Training %nstitute at &hantinagar and at various outside locations, like

angladesh %nstitute of bank #anagement - % #/.

1erformance Management) !ast year, E ! has introduced a performance3oriented culture and a participative performance appraisal process. Each employee is given annual performance target based on a discussion between the employee and his:her supervisor. *t year end, a performance evaluation called *nnual $lassified 0eport -*$0/ is carried out based on the targets and 7ey 0esponsibility *reas -70*s/. Irom now on, all increments, bonuses and promotions will be given based on the results of this performance evaluation.

1.4.#

5udit and *om+liance 6ivision)

The main function of this division is to provide legal assistance to the branches and to ensure strict adherence of rules and policies by all concerned officials of the bank through routine and surprise inspection and audit. The functions of this division are as follows@ %mplement rescheduling process of stuck3up loan to the branches for obtaining repayment schedule through strong persuasion and serve final notice etc. as the condition required. #onitor the individual cases with respect to their securities, value of securities, and finally review of possibility of recovery of bank"s stuck3up classified loan. %nvestigate suspicious or irregular matters being directed by higher management. *lso conduct such inquiry being requested by affected branch3in3charges. Time to time follow3up of stuck3up advances of branches and keep the branches under constant pressure. %nspect all branches" operations at least once in a year.
16

 $arry out surprise audit as felt necessary.

1.4.&

7inance and 5ccounts 6ivision)

Iinance and *ccounts division is a very important division for any ank, because its task is to #aintain daily liquidity positions, treasury bills, call money, debentures, placement of funds etc. #onthly3accrued interest calculation of all interests bearing accounts, inter3branch calculation for Gead .ffice, amorti8ation of all fi4ed and other assets. 6reparation of statement of accounts and profit and loss account for the bank. 5eekly deposit and advance analysis of the bank. $ost of fund analysis. #aintenance of accounts, preparation of annual report of the bank, maintenance of provident fund accounts, maintenance of income and e4penditure posting, maintenance of salaries and wages of the employees etc. Iulfilling reporting requirements of angladesh ank.

1.4./

Information 8echnology 6ivision) 6reviously, Eastern ank had a very low level of automation. There were hardly any

6$ in the whole ank before '((+. ut when the new management took over in '((+, they gave huge emphasis on computeri8ing the bank"s operations. *fter ' years, almost all the operations in the bank are now automated. The ank is also shifting to a new %T platform,

which aims at maintaining, operating and strengthening the technology base of the bank to
17

enable error free production of information that ensures ongoing efficiency and profitability of operation. * world class banking software called Ile4$ube has been installed which will centrali8e operations and provide .nline anking, %nternet anking, *utomated Teller

#achine, Telephone anking, 6oint of sale dispenser, $redit $ard facility etc.

5ith this implementation of state3of3the3art %nformation Technology, the %T division has become a very important contributor to the bank"s overall efficiency and profitability. *t present, the %T department serves the following functions@ Eevelopment of softwares for bank"s operation according to need, their maintenance and purchase of new softwares. #aintenance of computer hardwares and upgrading the 6$s whenever required. Training of the staff so that they can perform properly in the automated environment. 6reparing training materials. Troubleshooting with the new software.

1.4.0

International 6ivision) %nternational Eivision is responsible for assisting the authori8ed branches to deal in

foreign trades, that is, import and e4port businesses on account of the customers of the bank by giving approval for transactions and controlling them at various stages.

18

%t deals with all correspondents of foreign banks having arrangement with the bank. Every year new agents are added. The larger the number of correspondents and the wider the coverage area, the richer will be the international connections of the bank.

8he functions +erformed by this division are as follo s) $orrespondent banking relationship &upervision of foreign e4change transaction of other units #onitoring on compliance of angladesh ank regulations &upervise sale : purchase of foreign currencies 0econciliation of Mostro *ccounts

1.4.4

5dministration)

This department looks after the administrative matters and procurement and supply of all tangible goods to the branches. &ome of the main functions of this division are described as follows@ #ake arrangement for branch opening such as making lease agreement, internal decorations etc. 6rint all security papers and bank stationery. 6urchase necessary stationery items. Eistribute this stationery to the branches. 6urchase all sorts of furniture and fi4tures for the branches. %nstall and maintain different facilities for the branches etc.
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 %ssuance of power of attorney to the officers of the branches. %ssuance of different circulars of angladesh ank and other banks. Deneral correspondence with angladesh ank and other banks. *dvertise in the different media about tender notice, general meetings and public interests.

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%!L *ards
1.19 8y+es of *redit *ards

The following diagram shows the different types of credit cards that E ! currently offers.

1.11

7eatures of %!L Sim+le *redit *ard

Onetime Fee, Lifetime Free

To avail E ! $redit $ard services, customer needs to pay the

%ssuance:Joining:&ubscription: *nnual Iee only once. *fter that there is no annual fee for customer as long as customer transact at least +) times in a whole year. %t is a lifetime $ard. *s per market standard, an average cardholder uses his:her card almost '9 times annually. &o, without doing anything e4tra 3 customer can have the free renewal option N for the following year.
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Balance Transfer
E ! is happy to introduce customer has .ther alance Transfer for the first time in angladesh. %f

ank $redit $ard-s/, customer has the option to transfer his current

outstanding balance at a much cheaper rate to his E ! $redit $ard. This saves his money, time and gives customer the convenience to manage all his e4penses from one point. E ! want to be his lifetime partner. That is why E ! care about his current outstanding amount. E ! are offering average of less interest. alance Transfer - T/ O''K per annum. The standard market interest

ank $redit $ard is F(K. E ! are offering customer to switch his cards O)K

Card Cheque
Through E ! $redit $ard customer can enjoy a full3fledged cheque book facility. $ustomer can make payment -account payee only/ to any person or organi8ation of his choice. This cheque book is useful with situation where customer cannot use his credit card -e.g. tuition fees, rent, etc/. E ! are offering the I%0&T $GEPUE ..7 I0EE. There is a charge for subsequent $hequebooks.

Worldwide Acceptance
E ! $redit $ard is accepted at over L,((( V%&* merchant outlets around the country and over '9 million V%&* outlets worldwide. $ustomer can use this $ard for a wide range of products and services such as hotels, restaurants, airline ? travel agents, shopping malls and departmental stores, hospitals and diagnostic centers, jewelers, electronics ? computer shops, leather goods and shoe stores, mobile phone and internet service providers, fuel station and

22

what notQ This number is progressively on the rise. Mo matter wherever customer is N with E ! $redit $ards, customer will always have the purchase power.

Immediate Cash Advance

5ith an E ! $redit $ard in his wallet, customer will not be strapped for cash ever again. Ge can withdraw cash up to L(K of his total credit limit '93hours a day from any E ! *T#A or any V%&* participating member bank *T#s across the countryA or from any V%&* *T#s worldwide. Rou do not need to worry of carrying cash anywhere N not even on a foreign trip when there is no one to give customer hard cash at time of need.

Supplementar Card
E ! $redit $ard gives customer the opportunity to share the benefits of his card with his dear ones by providing customer supplementary cards. eing a primary cardholder,

customer has the option to set a spending limit for each of his supplementary cards. This is perfect for customer if customer is thinking of giving his children their pocket money in a controlled way. Rou can easily set3up their spending limit and also have an eye on their spending behavior. *ll transactions on his supplementary card will separately be shown on his monthly statement.

!is" Assurance #ro$ram

0isk *ssurance 6rogram is a Eouble enefit %nsurance 6lan for the E ! $redit

$ardholders. The entire dues on the credit card in the event of death or permanent total disability of E ! credit cardholder will be waived and the cardholder or his:her family will receive equal amount to meet immediate e4penses N under 0isk *ssurance 6rogram. Very

23

nominal charge will be applicable for this coverage. $ardholders can decide to cancel this program by sending a letter to us at any time.

%reat &iscounts
E ! have collaborated with hundreds of vendors for giving the E ! $redit $ard users a hefty discount on their products and services. The great discounts in turn allows customer either to save money or shop more with the same amount customer are spending now.

Shopper's %uide
E ! $redit $ard provides customer a list of shops and outlets where using the card will entitle customer to receive certain discount. E ! have chosen a large number of shops and retail outlets for the purpose. The printed guide comes with every details -i.e. shop name, address, discount value etc./ thus making his life easier.

(as Installment #ro$ram

Easy %nstallment 6rogram of E ! $redit $ard allows the cardholder to convert any retail transaction into an easy installment plan. Rou can purchase any high value product or service and make payments in equal monthly installments -E#%s/. The program will be available shortly and E ! will notify customer as soon as our network partners increase.

Auto &e)it Facilit

24

%f customer has an account with any Eastern ank branch, customer has the option of making the payment of his monthly credit statement -either the minimum amount due or the total amount due/ directly through his bank account.

Convenient #a ment Option

5hen customer receives his bill, customer need not pay the entire bill amount. Rou have the fle4ibility of selecting any of the following payment options@ +. 6ay the total amount due. '. 6ay only the minimum amount due -LK of his total outstanding or ET L((

whichever is higher for local card and for Eual card LK of his total outstanding or U&E +( whichever is higher/ and the balance can be carried forward to subsequent statements. F. 6ay any amount ranging from the minimum amount due to the total amount due. Rou can plan his payments conveniently, without creating any e4tra pressure on his finances.

S*ail Service
E ! cardholders can receive monthly statements via e3mail, completely free of cost. This is a fast, reliable and efficient service, which will minimi8e his paperwork and ma4imi8e convenience. Gis &tatement #ails or &#ails can be delivered to more than one e3mail address -up to a ma4imum of three e3mail addresses/. *ll customer need to do is just filling up the form and E ! will do the rest. %t"s all smile with &#ail.

%lo)al (mer$enc Assistance Service

25

5hen customer travel abroad, please remember that customer have the option of using the Dlobal Emergency *ssistance &ervices provided by V%&* for our cardholders. These can be availed for@ +. 0eporting lost:stolen credit cards, '. 0equesting for an emergency card replacement, F. Emergency cash advance ? 9. #iscellaneous enquiries. The toll free telephone numbers for accessing these emergency assistance Gelp lines are available in local telephone directories:yellow pages and other local listings in each country.

(BL *o)ile Alert

E ! #obile *lert is a very simple, powerful and convenient way to know his $redit $ard statement details instantly without any postal delays. *s soon as customer becomes an E ! $redit $ardholder, he automatically join in the E ! #obile *lert service and get faster, reliable access to his #onthly &tatement. #obile alerts from E ! provides customer with information on his E ! $redit $ard even when customer are on the move. Rou would now no longer miss a payment or e4haust his credit limit without a warning. .nce his statement is generated, E ! will notify customer about the balance status with payment information. !ife has never been so easier.

(BL !ewards #ro$ram

* special bonus plan that allows customer to earn points every time customer use his $ard, Every Tk. L( that customer spend earns customer + point. The redemption of reward points can be done against the products, services in the rewards catalogue. The enrollment is free. E ! are preparing the rewards listing and shall mail customer the catalogue with program details as soon as it is launched.

Self+set Limit
26

E ! $redit $ard is the only $ard that allows customer to pre3define his own credit limits. Rou can request for a limit lower than what customer are eligible for. Rou can even preset the monthly spending limits on the &upplementary $ards. *ny transactions over the specified C&pend !imitC will be declined. This monthly spending limit can be reset every billing cycle by just calling the E ! '93hour $ards $enter and place his request with the $ustomer &ervice E4ecutive. Gis spend limit will be changed on3line and come in to force from the ne4t billing cycle.

Limited Lost Card Lia)ilit

%n case the $ard is lost or stolen, call the E ! '93hour $ards $enter and report the loss of his $ard. * new $ard will be sent to customer within 2' hours of reporting this loss. Rou are protected from any financial liability arising out of transactions done on his missing $ard, from the time customer report the loss to us.

,-+hour Cards Center

The E ! '93hour $ards $enter is equipped with a state3of3the3art system that ensures his queries being handled efficiently and promptly. Ior any card3related query or information, all customer need to do is dial ,L2+21( or ,L2+22L E4t. +'(:+F(

27

1.12

7ees , *harges e:cluding (58; all in !68

LOCAL CLASSIC LOCAL GOLD DUAL CLASSIC DUAL GOLD

Card Issuance Fee

1,300

2,500

1,300

2,500

Card Issuance Fee - Supplementary Card Renewal Fee - Any Supplementary Card* Card Replacement Fee !IN Replacement Fee

1,300 NIL 300 150

2,500 NIL 500 300

1,300 NIL 00 200

2,500 NIL 500 00

F"nance C#ar$e %n all &ransact"%ns 'per m%nt#( +alance &rans,er Interest 'per m%nt#( Interest %n ./cess %, L"m"t Am%unt 'per m%nt#( Late !ayment Fee '+1&( Late !ayment Fee '2(

2)50* 1)-3* 2)02* 00 3

2)50* 1)-3* 2)02* 00 3

2)50* 1)-3* 2)02* 00 2 10

2)50* 1)-3* 2)02* 500 2 10

Cas# Ad4ance Fee '+1& 5 w#"c#e4er #"$#er( Cas# Ad4ance Fee '2( +alance &rans,er Fee 1upl"cate Statement Fee '+1&( Returned C#e6ue Fee '+1&( Sales 7%uc#er Retr"e4al Fee Cert","cate Fee ./p"red Card !r"nt"n$ C#ar$e8!last"c Fee '.4ery 2 9ears, ", t#e card "s "n :er% renewal m%de( R"s; Assurance Fee '+1&( F"rst Card C#e6ue +%%; 5 12 Lea4es Card C#e6ue +%%; Fee 12 lea4es '+1&( Card C#e6ue +%%; Fee 25 lea4es '+1&( Card C#e6ue !r%cess"n$ Fee '+1&( Statement <y .ma"l - S=a"l Ser4"ce

3* %r 100 3 1* 300 200 200 200

3* %r 100 3 1* 300 200 200 200

3* %r 100 3* %r 25 1* 300 200 200 200

3* %r 100 3* %r 25 1* 300 200 200 200

100

100

100

100

0)35* Free 150 250 1* Free

0)35* Free 150 250 1* Free

0)35* Free 150 250 1* Free

0)35* Free 150 250 1* Free

*Su<>ect t% m"n"mum 1- transact"%ns "n a year 15* 7A& appl"ca<le %n all ,ees and c#ar$es

28

29

Pro(e#t Part

30

Statistical 5nalysis
1.13 Objectives of this +art

%n this part % will do my statistical analyses on the data % have collected on E ! cards. % will primarily focus on the following courses of actions. *t first % will show what the variables in my analysis are and why they are important. % will present the data sheet on the variables on which % will do my statistical analyses. #y first course of action will be to show some descriptive statistics of the variables along with graphical representations of the variables. 5ith the data, % will conduct estimations of population means of each of the variables using confidence level technique. % will then analy8e the correlation among the independent variables with the dependent variable. Iinally % will show the multiple linear regression model and carry out I3test, Eurbin 5atson auto correlation test and individual t3test for beta coefficients.

31

1.14

8he (ariables in my 5nalysis

%n this section % am going to describe what the variables are and what do they mean. $redit $ard &ales N They reflect the number of credit card sales in the month of #ay '((). This is the main dependent variable of my model. The following are the independent variables in my study. Eebit $ard &ales N They reflect the number of debit card sales in the month of #ay '((). Mew Eeposits .pened N They reflect the number of new deposit accounts opened in the month of #ay '((). Mew !oan *ccounts N They indicate the number of new loan accounts opened in the month of #ay '((). Eeposit Drowth 0ate N %t reflects the deposit growth rate in percentage from *pril to #ay '((). !oan Drowth 0ate N %t shows the loan growth rate in percentage from *pril to #ay '((). Eirect &ales Team N %t shows the number of direct sales team in each branch in #ay '(()

32

6ermanent &taff N %t shows the number of permanent staff enrolled in each branch in #ay '(().

1.1#

6ata Sheet
efore starting the analysis, % will present the data sheet on which % will conduct the

statistical analysis. *s % have stated in the beginning of my report, % will analy8e whether some of the factors such as new deposit accounts, direct sales team number, debit card sales etc. influence the sale of credit cards. The following is the data sheet.

Bran#$ O R Nizam Sonargaon Road Motijheel Banani Gulshan Dhanmondi Principal Uttara Agrabad Shantinagar ha!"bajar Nara#angonj $ubilee Road Shamol# Station Road Mirpur %nglish Road handgaon Panchlaish Bashundhar a &hulna Moul'ibazar Rajshahi Upashahar Bogra

Cre)it De+it Ne, De-o*it* Ne, 'oan* De-o*it Gro,t$ Car)* Car)* O-ene) O-ene) Ta.a /01 154 0 203 23 140 131 96 223 223 266 180 216 163 67 154 154 142 141 123 108 96 96 144 62 62 55 59 66 67 50 45 37 275 107 52 61 69 147 48 0 31 17 17 33 58 50 78 5 3 157 3 34 150 167 144 81 0 91 128 93 164 4 118 104 95 121 60 0 56 113 112 122 43 84 31 72 25 42 17 9 12 6 11 0 10 2 6 14 7 1 0 12 6 16 4 9 5 3 4 4 33

&hatunganj Bis!anath houhatta $essore Raozan

63 61 61 52 48

18 47 29 2 54

58 12 39 39 42

0 2 0 4 8

*s we can see, the data have been arranged according to branches of Eastern

ank

!td. *s there are F( branches, there are F( observations for each set of variables. These data are of #ay '((). The credit card sales number will be the dependent variable in my regression analysis and the rest seven factors are my independent variables. 5ith this thing into account, % will do the calculations in the regression analysis part. esides % will also do estimation of population mean, analysis of variance, validity test with confidence level of ,(K, durbin3watson test. There will be some descriptive statistics also but they are not the main focus of this report.

1.1&

!asic 6escri+tive Statistics

%t is important to know some of the basic descriptive statistics of the variables that %

am including in my model. *lthough they are not the key focus of this report as inferential statistics are, nevertheless they are very important in knowing the central tendency of their distribution and also the degree of dispersion. Understanding such statistics help us to determine the skewness of the distribution of the variables and hence will help us infer more about the distribution of the population means.
Descriptive Statistics in a shapshot Debit New New Direct Deposit Card Deposit Loan

Credit Card

Loan Permanent Staff

Sales Growth Growth

34

N ean edian Std" Deviation Percentiles

Valid issin!

Sales 30 0 120.20 115.50 !0.1!8 !2.00 115.50 154.00

SalesAccountsAccounts 30 30 30 0 0 0 53.13 84.87 8.73 4!.00 87.50 !.00 57.108 53.0 5 .040 17.00 4!.00 !2.50 41.25 87.50 121.25 2.75 !.00 12.00

Team Rate 30 30 0 0 7.50 2.11 3 7.00 1.2700 2.013 3.!4780 !.00 7.00 .00 .3225 1.2700 2.5525

Rate 30 0 .4 03 .4750 .5 5 3 .1350 .4750 .7725

30 0 11.33 10.00 3. 51 8.00 10.00 13.25

#$ $% &$

*s we can see % have shown the mean, median, standard deviation and quartiles of each of the eight variables. The mean and median shows us the central tendency and the standard deviation shows us the dispersion. Ior e4ample, credit card sales variable has high degree of dispersion due to high standard deviation compared to variables such as permanent staff, which change very slowly from the mean value.

1.1/

<ra+hical -e+resentation of %ach (ariable

5. *redit *ard Sales The following is the frequency table of credit card sales figure. &ince all the values are numerical value, the frequency table is quite large.
're(uenc) Table of Credit Card Sales 're(uenc) Percent Valid Percent 1 1 1 1 2 2 1 1 1 3 1 1 1 1 1 1 3.3 3.3 3.3 3.3 !.7 !.7 3.3 3.3 3.3 10.0 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 !.7 !.7 3.3 3.3 3.3 10.0 3.3 3.3 3.3 3.3 3.3 3.3

Value 48 52 55 5 !1 !2 !3 !! !7 ! 108 123 131 140 141 142

Cumulative Percent 3.3 !.7 10.0 13.3 20.0 2!.7 30.0 33.3 3!.7 4!.7 50.0 53.3 5!.7 !0.0 !3.3 !!.7

35

144 154 1!3 180 21! 223 2!! "otal

1 3 1 1 1 2 1 30

3.3 10.0 3.3 3.3 3.3 !.7 3.3 100.0

3.3 10.0 3.3 3.3 3.3 !.7 3.3 100.0

70.0 80.0 83.3 8!.7 0.0 !.7 100.0

Inter+retation of *hart) The following bar chart in the ne4t page illustrates the credit card sales figure according to percentage by branch. 5e can clearly see that credit cards are mostly sold in 6rinciple branch in Eilkusha, Ehanmondi and Dulshan with sales percentage of around 2K, 1K and 1K respectively. This illustrates the main targeted market of the credit cards.

36

!. 6ebit *ard Sales The following is the frequency table of credit card sales figure. &ince all the values are numerical value, the frequency table is quite large.
're(uenc) Table of Debit Card Sales 're(uenc) Percent Valid Percent 2 1 2 1 2 1 1 1 1 1 1 1 1 1 2 1 1 1 1 1 1 1 1 1 1 1 30 !.7 3.3 !.7 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 100.0 !.7 3.3 !.7 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 100.0

Values 0 2 3 5 17 18 2 31 33 34 37 45 47 48 50 52 54 58 !1 !7 ! 78 107 147 157 275 "otal

Cumulative Percent !.7 10.0 1!.7 20.0 2!.7 30.0 33.3 3!.7 40.0 43.3 4!.7 50.0 53.3 5!.7 !3.3 !!.7 70.0 73.3 7!.7 80.0 83.3 8!.7 0.0 3.3 !.7 100.0

The following chart illustrated the debit card sales figure according to percentage by branch.

37

Inter+retation of *hart) %f we look at the percentage of debit card sales, the highest concencentration is in Ehanmondi which is around +2K and it is not surprising considering the market for debit cards there. *. =e 6e+osit 5ccounts The following is the frequency table of new deposit accounts.
're(uenc) Table of New Deposit Accounts 're(uenc) Percent Valid Percent 2 1 1 1 2 1 1 1 1 !.7 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3 !.7 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3

Values 0 4 12 31 3 42 43 5! 58

Cumulative Percent !.7 10.0 13.3 1!.7 23.3 2!.7 30.0 33.3 3!.7

38

!0 72 81 84 1 3 5 104 112 113 118 121 122 128 144 150 1!4 1!7 203 "otal

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 30

3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 100.0

3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 100.0

40.0 43.3 4!.7 50.0 53.3 5!.7 !0.0 !3.3 !!.7 70.0 73.3 7!.7 80.0 83.3 8!.7 0.0 3.3 !.7 100.0

Inter+retation of *hart) %f we look at the doughnut chart in the ne4t page, we can see that the highest percentage of new deposit accounts is opened in . 0 Mi8am branch -)K/ followed by #otijheel ranch -2K/. The lowest percentage belonged to English 0oad ranch with (K in the month of #ay '(().

39

6. =e Loan 5ccounts The following is the frequency table of new loan accounts.
're(uenc) Table of New Loan Accounts 're(uenc) Percent Valid Percent 4 1 2 1 4 1 3 1 1 2 1 1 2 1 1 1 1 1 1 13.3 3.3 !.7 3.3 13.3 3.3 10.0 3.3 3.3 !.7 3.3 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3 13.3 3.3 !.7 3.3 13.3 3.3 10.0 3.3 3.3 !.7 3.3 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3

Values 0 1 2 3 4 5 ! 7 8 10 11 12 14 1! 17 23 25 42

Cumulative Percent 13.3 1!.7 23.3 2!.7 40.0 43.3 53.3 5!.7 !0.0 !!.7 70.0 73.3 80.0 83.3 8!.7 0.0 3.3 !.7 100.0

40

"otal

30

100.0

100.0

Inter+retation of *hart) %f we look at the chart, we can see that the highest percentage of new loan accounts is opened in #otijheel branch followed by &onargaon 0oad ranch. The lowest percentage belonged to *grabad, #irpur, $houhatta and 7hatunganj ranches with (K in the month of #ay '(().

%. 6irect Sales 8eams

41

The following is the frequency table of direct sales team numbers in branches.
're(uenc) Table of Direct Sales Team 're(uenc) Percent Valid Percent 4 8 ! 2 5 3 1 1 30 13.3 2!.7 20.0 !.7 1!.7 10.0 3.3 3.3 100.0 13.3 2!.7 20.0 !.7 1!.7 10.0 3.3 3.3 100.0

Values 5 ! 7 8 10 11 13 "otal

Cumulative Percent 13.3 40.0 !0.0 !!.7 83.3 3.3 !.7 100.0

Inter+retation of *hart) %f we look at the chart, we can see that the highest percentage of direct sales team is in Dulshan branch. The lowest percentage belonged to many ranches such as $houhatta, Upashar etc. in the month of #ay '(().

7. 6e+osit <ro th -ate

42

The following is the frequency table of deposit growth rate in branches.

're(uenc) Table of Deposit Growth Rate 're(uenc) Percent Valid Percent 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 1 1 1 1 1 1 1 1 1 1 1 1 1 30 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 100.0 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 100.0

Values #.88 #.43 #.3! .10 .12 .1 .30 .33 .42 .4! .50 .57 .75 1.18 1.25 1.2 1.4! 1.87 2.02 2.04 2.21 2.51 2.!8 2.71 3.!4 3.77 !.02 !.41 1 .1! "otal

Cumulative Percent 3.3 !.7 10.0 13.3 1!.7 20.0 23.3 2!.7 30.0 33.3 3!.7 40.0 43.3 4!.7 50.0 5!.7 !0.0 !3.3 !!.7 70.0 73.3 7!.7 80.0 83.3 8!.7 0.0 3.3 !.7 100.0

Inter+retation of *hart) %f we look at the chart, we can see that the highest percentage of deposit growth rate is in *grabad branch. The lowest percentage belonged to many ranches such as . 0 Mi8am, English 0oad etc. in the month of #ay '(().

43

<. Loan <ro th -ate The following is the frequency table of loan growth rate in branches.
're(uenc) Table of Loan Growth Rate 're(uenc) Percent Valid Percent 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3 3.3

Values #.77 #.53 #.24 #.08 .04 .0 .12 .14 .21 .22 .24 .33 .35 .37 .44 .51 .52

Cumulative Percent 3.3 !.7 10.0 13.3 1!.7 20.0 23.3 2!.7 30.0 33.3 3!.7 40.0 43.3 4!.7 50.0 53.3 5!.7

44

.!2 .!3 .!4 .!5 .!7 .77 .78 . 2 1.03 1.28 1.5! 2.28 "otal

1 1 1 1 1 1 1 2 1 1 1 1 30

3.3 3.3 3.3 3.3 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3 100.0

3.3 3.3 3.3 3.3 3.3 3.3 3.3 !.7 3.3 3.3 3.3 3.3 100.0

!0.0 !3.3 !!.7 70.0 73.3 7!.7 80.0 8!.7 0.0 3.3 !.7 100.0

Inter+retation of *hart) %f we look at the chart, we can see that the highest percentage of loan growth rate is in &onargaon 0oad branch. The lowest percentage belonged to 0ao8an ranch in the month of #ay '(().

45

$. 1ermanent Staff The following is the frequency table of permanent staff in branches.
're(uenc) Table of Permanent Staff 're(uenc) Percent Valid Percent 2 1 5 4 4 2 2 3 1 2 1 1 1 1 30 !.7 3.3 1!.7 13.3 13.3 !.7 !.7 10.0 3.3 !.7 3.3 3.3 3.3 3.3 100.0 !.7 3.3 1!.7 13.3 13.3 !.7 !.7 10.0 3.3 !.7 3.3 3.3 3.3 3.3 100.0

Values ! 7 8 10 11 12 13 14 15 1! 1 20 21 "otal

Cumulative Percent !.7 10.0 2!.7 40.0 53.3 !0.0 !!.7 7!.7 80.0 8!.7 0.0 3.3 !.7 100.0

Inter+retation of *hart) %f we look at the chart, we can see that the highest percentage of permanent staff is in *grabad branch. The lowest percentage belonged to iswanath ranch in the month of #ay '(().

46

1.10

%stimation of 1o+ulation Means

&ince these data are only of the month of #ay '((), % will be using estimation

methods to identify the population mean of the ) variables that % am including in my statistical analysis. >ustification of using 8?test instead of @?test) &ince % do not know the variance of my population, % will be using one-sample students t test instead of 83test to estimate the population means using ,(K confidence level. The student"s t3test is perfect over the 83test in this case since % cannot simply assume that the population distribution is also normal.

1. Estimation of Credit Card Sales Population Mean Irom the data sheet % have inserted the credit card sales data and with ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&&.
*ne+Sample Test Test Value , -.% t #1.802 df 2 Si!" /#+tailed0 .082 ean Difference #1 .80

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of $redit $ard &ales is +9( -ST+9(/ lternati!e Hypothesis H": 6opulation #ean of $redit $ard &ales is not +9( -SU+9(/

47

6ecision) &ince the p3value of the t3test is .()' which is less than V T .+(, we will be rejecting the null hypothesis and accept the alternative hypothesis that the population mean is not equal to +9(.
1%2 Confidence 3nterval of the Difference $o%er 101.53 Upper 138.87

%stimation of Mean by using *onfidence Interval) The results show that the population mean of credit card sales is estimated to lie in the range of +(+.LFW S W +F).)2 with ,(K confidence level.

2. Estimation of Debit Card Sales Population Mean Using ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&& by using the values from the data sheet.
*ne+Sample Test Test Value , 4% t #.!5 df 2 Si!" /#+tailed0 .515 ean Difference #!.87

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of Eebit $ard &ales is 1( -ST1(/ lternati!e Hypothesis H": 6opulation #ean of Eebit $ard &ales is not 1( -SU1(/

48

6ecision) &ince the p3value of the t3test is .L+L which is greater than V T .+(, we will not be rejecting the null hypothesis and discard the alternative hypothesis that the population mean is not equal to 1(.
1%2 Confidence 3nterval of the Difference $o%er 35.42 Upper 70.85

%stimation of Mean Asing *onfidence Interval) The results show that the population mean of debit card sales is estimated to lie in the range of FL.9'W S W 2(.)L with ,(K confidence level.

3. Estimation of New Deposit Accounts Population Mean Irom the data sheet % have inserted the debit card sales data and with ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&&.
*ne+Sample Test Test Value , 1% t #.530

df 2

Si!" /#+ ean tailed0 Difference .!00 #5.13

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of Mew Eeposit *ccounts is ,( -ST,(/ lternati!e Hypothesis H": 6opulation #ean of Mew Eeposit *ccounts is not ,( -SU,(/

49

6ecision) &ince the p3value of the t3test is .1 which is greater than V T .+(, we will not be rejecting the null hypothesis and discard the alternative hypothesis that the population mean is not equal to ,(.
1%2 Confidence 3nterval of the Difference $o%er !8.4 Upper 101.34

%stimation of 1o+ulation Mean Asing *onfidence Interval) The results show that the population mean of new deposit accounts is estimated to lie in the range of 1).9W S W +(+.F9 with ,(K confidence level.

4. Estimation of New oan Accounts Population Mean Using ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&& by using the values from the data sheet.
*ne+Sample Test Test Value , -% t #.7!7

df 2

Si!" /#+ ean tailed0 Difference .44 #1.27

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of Mew !oan *ccounts is +( -ST+(/ lternati!e Hypothesis H": 6opulation #ean of Mew !oan *ccounts is not +( -SU+(/

50

6ecision) &ince the p3value of the t3test is .99, which is greater than V T .+(, we will not be rejecting the null hypothesis and discard the alternative hypothesis that the population mean is not equal to +(.
1%2 Confidence 3nterval of the Difference $o%er 5. 3 Upper 11.54

%stimation of 1o+ulation Mean Asing *onfidence Interval) The results show that the population mean of new loan accounts is estimated to lie in the range of L.,FW S W ++.L9 with ,(K confidence level.

!. Estimation of Direct Sales "eam Population Mean Irom the data sheet % have inserted the debit card sales data and with ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&&.
*ne+Sample Test Test Value , -% t #!.803 df 2 Si!" /#+ ean tailed0 Difference .000 #2.50

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of Eirect &ales Team is +( -ST+(/ lternati!e Hypothesis H": 6opulation #ean of Eirect &ales Team is not +( -SU+(/

51

6ecision) &ince the p3value of the t3test is .( which is less than V T .+(, we will be rejecting the null hypothesis and accept the alternative hypothesis that the population mean is not equal to +(.
1%2 Confidence 3nterval of the Difference $o%er !.88 Upper 8.12

%stimation of 1o+ulation Mean Asing *onfidence Interval) The results show that the population mean of direct sales team is estimated to lie in the range of 1.))W S W ).+' with ,(K confidence level.

#. Estimation of Deposit $rowt% &ate Population Mean Using ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&& by using the values from the data sheet.
*ne+Sample Test Test Value , 5 t #1.322

df 2

Si!" /#+ ean tailed0 Difference .1 ! #.8807

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of Eeposit Drowth 0ate is FK -STF/ lternati!e Hypothesis H": 6opulation #ean of Eeposit Drowth 0ate is not F -SUF/

52

6ecision) &ince the p3value of the t3test is .99, which is greater than V T .+(, we will not be rejecting the null hypothesis and discard the alternative hypothesis that the population mean is not equal to F.
1%2 Confidence 3nterval of the Difference $o%er . 877 Upper 3.25

%stimation of 1o+ulation Mean Asing *onfidence Interval) The results show that the population mean of deposit growth rate is estimated to lie in the range of .,)22W S W F.'L with ,(K confidence level.

'. Estimation of oan $rowt% &ate Population Mean Irom the data sheet % have inserted the debit card sales data and with ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&&.
*ne+Sample Test Test Value , 5 t #23.0!!

df 2

Si!" /#+ ean tailed0 Difference .000 #2.50 7

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of !oan Drowth 0ate is FK -STF/ lternati!e Hypothesis H": 6opulation #ean of !oan Drowth 0ate is not FK -SUF/

53

6ecision) &ince the p3value of the t3test is .( which is less than V T .+(, we will be rejecting the null hypothesis and accept the alternative hypothesis that the population mean is not equal to FK.
1%2 Confidence 3nterval of the Difference $o%er .3055 Upper 3.!752

%stimation of 1o+ulation Mean Asing *onfidence Interval) The results show that the population mean of new loan accounts is estimated to lie in the range of .F(LLW S W F.12L' with ,(K confidence level.

(. Estimation of Permanent Staff Population Mean Irom the data sheet % have inserted the debit card sales data and with ,(K confidence interval level and using student"s t distribution, % have come up with the following statistical output from &6&&.
*ne+Sample Test Test Value , -$ t #5.083 df 2 Si!" /#+ ean tailed0 Difference .000 #3.!7

$y+othesis 8esting Null Hypothesis H0 : 6opulation #ean of 6ermanent &taff is +L -ST+L/ lternati!e Hypothesis H": 6opulation #ean of !oan Drowth 0ate is not +L -SU+L/

54

6ecision) &ince the p3value of the t3test is .( which is less than V T .+(, we will be rejecting the null hypothesis and accept the alternative hypothesis that the population mean is not equal to +L.
1%2 Confidence 3nterval of the Difference $o%er 10.11 Upper 12.5!

%stimation of 1o+ulation Mean Asing *onfidence Interval) The results show that the population mean of new loan accounts is estimated to lie in the range of +(.++W S W +'.L1 with ,(K confidence level.

55

1.14

1earson 1roduct?Moment *orrelation

The following table shows the 6earson product3moment correlation coefficient

between all the variables included in my data sheet. %n statistics, the 6earson product3moment correlation coefficient -sometimes referred to as the #$V or 6#$$, and typically denoted by r/ is a common measure of the correlation between two variables X and Y .Gowever the focus is only the correlation between the dependent variable <$redit $ard &ales= and the other 2 variables. 5e know that correlation values ranged between 3+ to X+. Megative one indicates perfectly negative correlation which means the variables move in opposite direction and positive one indicates perfectly positive correlation which means the factors move in same direction. * correlation of 8ero indicates no linear relationship between the two variables but there might or might not be non3linear relationship.

Correlations between all variables Credit Card Sales 1 . 30 .31 .08! 30 .335 .070 30 #.200 .2 0 30 .! 8'' .000 Debit New New Card Deposit Loan Sales Accounts Accounts .31 .335 #.200 .08! 30 1 . 30 #.257 .171 30 .003 . 8 30 .3 3 .032 .070 30 #.257 .171 30 1 . 30 .57! .001 30 .174 .357 .2 0 30 .003 . 8 30 .57! .001 30 1 . 30 .2 0 .120 Direct Deposit Loan Permanent Sales Growth Growth Staff Team Rate Rate .! 8'' #.323 #.28! .87 '' .000 30 .3 3 .032 30 .174 .357 30 .2 0 .120 30 1 . .082 30 .0!2 .747 30 .173 .3!0 30 .125 .50 30 .0!4 .73 .12! 30 #.033 .8!1 30 .555 .001 30 .317 .088 30 .3 5 .031 .000 30 .230 .222 30 .217 .24 30 .202 .283 30 .!50 .000

Credit &earson Card Sales Correlation (ig. )2# tailed* + Debit Card &earson Sales Correlation (ig. )2# tailed* + New &earson Deposit Correlation Accounts (ig. )2# tailed* + New Loan &earson Accounts Correlation (ig. )2# tailed* + Direct &earson Sales Correlation Team (ig. )2#

56

tailed* + 30 30 30 Deposit &earson #.323 .0!2 .173 Growth Correlation Rate (ig. )2# .082 .747 .3!0 tailed* + 30 30 30 Loan &earson #.28! #.033 .555 Growth Correlation Rate (ig. )2# .12! .8!1 .001 tailed* + 30 30 30 Permanent &earson .87 '' .230 .217 Staff Correlation (ig. )2# .000 .222 .24 tailed* + 30 30 30 '' Correlation is significant at the 0.01 le,el )2#tailed*. ' Correlation is significant at the 0.05 le,el )2#tailed*.

30 .125 .50 30 .317 .088 30 .202 .283 30

30 .0!4 .73 30 .3 5 .031 30 .!50 .000 30

30 1 . 30 .321 .084 30 .4!5 .010 30

30 .321 .084 30 1 . 30 .345 .0!2 30

30 .4!5 .010 30 .345 .0!2 30 1 . 30

The following table is the most significant one and is e4tracted from the above table. %t shows the correlation between the only dependent variable, Ycredit card sales" and the other seven variables. This is important as the correlation will play a factor in the linear regression model.
Correlations between Credit Card Sales 6 other variables Credit Card Pearson Correlation Si!" /#+ tailed0 N Sales 1 . 30 Debit Card New New Loan Deposit Accounts #.200 .2 0 30 Direct Sales Team .! 8'' .000 30 Deposit Growth Rate #.323 .082 30 Loan Permanent Growth Rate #.28! .12! 30 Staff .87 '' .000 30

Sales Accounts .31 .335 .08! 30 .070 30

Inter+retation of *orrelation) %f we look at the correlation between the independent variables and the dependent variables, we can see that debit card sales, new deposit accounts, direct sales team and permanent staff have positive correlation with credit card sales and new loan accounts, deposit growth rate and loan growth rate have negative correlation with credit
57

card sales. .nly permanent staff and direct sales team have very high correlation with credit card sales, which proves one point that these two variables play a very important role in the sales of credit card figures. *ll the other variables have low to weak correlation, which means they slightly or moderately influence the credit card sales figure in either positive or negative way. %n short, the correlation just shows the strength and direction but does not actually quantify by how much those variables will influence the dependent variable. Ior that we have to go now to multiple linear regression model. #ut for no$% correlation sho$s that direct sales team and permanent staff ha!e statistically strong influence on credit card sales.

1.14.1

$y+othesis 8esting of 1o+ulation *orrelations

". Null Hypothesis H0 : 6opulation $orrelation between $redit $ard ? Eebit $ard is 8ero -ZT(/ lternati!e Hypothesis H": 6opulation $orrelation between $redit $ard ? Eebit $ard is not 8ero -ZU(/ 6ecision) &ince the p3value of the correlation test is .()1 which is greater than V T.(L, the population correlation is statistically insignificant and hence we do not reject the null hypothesis and discard the alternative hypothesis that the population correlation is not 8ero.

&. Null Hypothesis H0 : 6opulation $orrelation between $redit $ard ? Mew Eeposit *ccounts is 8ero -ZT(/
58

lternati!e Hypothesis H": 6opulation $orrelation between $redit $ard ? Mew Eeposit *ccounts is not 8ero -ZU(/ 6ecision) &ince the p3value of the correlation test is .()1 which is greater than V T.(L, the population correlation is statistically insignificant and hence we do not reject the null hypothesis and discard the alternative hypothesis that the population correlation is not 8ero.

'. Null Hypothesis H0 : 6opulation $orrelation between $redit $ard ? Mew !oan *ccounts is 8ero -ZT(/ lternati!e Hypothesis H": 6opulation $orrelation between $redit $ard ? Mew !oan *ccounts is not 8ero -ZU(/ 6ecision) &ince the p3value of the correlation test is .', which is greater than V T.+, the population correlation is statistically insignificant and hence we do not reject the null hypothesis and discard the alternative hypothesis that the population correlation is not 8ero.

(. Null Hypothesis H0: 6opulation $orrelation between $redit $ard ? Eirect &ales Team is 8ero -ZT(/ lternati!e Hypothesis H": 6opulation $orrelation between $redit $ard ? Eirect &ales Team is not 8ero -ZU(/ 6ecision) &ince the p3value of the correlation test is .(( which is less than V T.(L, the population correlation is statistically significant and hence we reject the null hypothesis and accept the alternative hypothesis that the population correlation is not 8ero.

59

). Null Hypothesis H0 : 6opulation $orrelation between $redit $ard ? Eeposit Drowth 0ate is 8ero -ZT(/ lternati!e Hypothesis H": 6opulation $orrelation between $redit $ard ? Eeposit Drowth 0ate is not 8ero -ZU(/ 6ecision) &ince the p3value of the correlation test is .()' which is greater than V T.(L, the population correlation is statistically insignificant and hence we do not reject the null hypothesis and discard the alternative hypothesis that the population correlation is not 8ero.

*. Null Hypothesis H0 : 6opulation $orrelation between $redit $ard ? !oan Drowth 0ate is 8ero -ZT(/ lternati!e Hypothesis H": 6opulation $orrelation between $redit $ard ? !oan Drowth 0ate is not 8ero -ZU(/ 6ecision) &ince the p3value of the correlation test is .+'1 which is greater than V T.(L, the population correlation is statistically insignificant and hence we do not reject the null hypothesis and discard the alternative hypothesis that the population correlation is not 8ero.

+. Null Hypothesis H0 : 6opulation $orrelation between $redit $ard ? 6ermanent &taff is 8ero -ZT(/

60

lternati!e Hypothesis H": 6opulation $orrelation between $redit $ard ? 6ermanent &taff is not 8ero -ZU(/ 6ecision) &ince the p3value of the correlation test is .(( which is less than V T.(L, the population correlation is statistically significant and hence we reject the null hypothesis and accept the alternative hypothesis that the population correlation is not 8ero.

1.29

Multi+le Linear -egression Model

%n this part, % will focus on creating a multiple linear regression model in which the

credit card sales will be dependent model and the rest will be independent model. % have
61

already shown in the correlation part to determine in what way each of the independent variables affect the dependent variable. %n this regression model, % will e4actly quantify by much the independent variables will affect the dependent variable. 1.29.1 Model Summary
odel Summar) R R S(uare Ad7usted Std" 8rror R S(uare . 38 .880 .842 of the 8stimate 23. 38 Durbin+ 9atson 2.3!2

a &redictors- )Constant*. &er/anent (taff. +e% $oan Acco0nts. 1e2it Card (ales. $oan 3ro%th Rate. 1eposit 3ro%th Rate. +e% 1eposit Acco0nts. 1irect (ales "ea/ 2 1ependent 4aria2le- Credit Card (ales

Inter+retation of - sBuare) The model summary shows some important indicators of the e4plaining power of the model. The 03square value shows how much change in the dependent variable is caused by the independent variables. %n this case a r3square value of .)) or ))K means ))K of the change in dependent variable is caused by the seven independent variables. Inter+retation of 5djusted -?sBuare) .n the other hand, the adjusted r3square value shows how much change in the dependent variable is caused by statistically significant variables. &o in this case, an adjusted r3square value of .)9' or )9.'K means that )9.'K of the change in dependent variable is caused by statistically significant variables, which will be found later in the report. The standard error of the estimate measures the accuracy of the predictions within the regression line, which is around 'F.,F).

1.29.2

6urbin?Catson 8est
62

*ccording to 5ikipedia.com, the Eurbin35atson statistic is a test statistic used to detect the presence of autocorrelation in the residuals from a regression analysis. %n statistics, the autocorrelation function -*$I/ of a random process describes the correlation between the processes at different points in time. The Eurbin 5atson value ranges from ( to 9. * value of ' indicates there appears to be no autocorrelation. %f the Eurbin35atson statistic is substantially less than ', there is evidence of positive serial correlation. *s a rough rule of thumb, if Eurbin35atson is less than +.(, there may be cause for alarm. &mall values of d indicate successive error terms are, on average, close in value to one another, or positively correlated. !arge values of d indicate successive error terms are, on average, much different in value to one another, or negatively correlated.

The test statistic of Eurbin35atson model is see we use error values according to time.
R R S(uare Ad7usted Std" 8rror R S(uare . 38 .880 .842 of the 8stimate 23. 38 Durbin+ 9atson 2.3!2

and hence we

The Eurbin35atson test statistic of my model is '.F1', which means there is very little negative correlation among the variable. Gowever this is not alarming as the value is close of ', which signals it is close to no autocorrelation.

1.29.3

5nalysis of (ariance D5=O(5E The *M.V* table shows the total variation, the e4plained variation and the

une4plained variation -residual/ due to the error. The e4plained variation is denoted as &&0
63

and the une4plained variation due to residuals is denoted by &&E. The total variation -&&T/ is +(9,)1.) and variation e4plained by regression -&&0/ is ,'F)(.9'2 and variation e4plained by regression error &&E is +'1(1.F2F. &o the e4plaining power of the regression model is good since &&0 is greater than &&E. %f we divide the &&0 with &&T, we get the value of r3 square which we have already found out to be ))K.

AN*VA Sum of S(uares Re!ression 2380.427 Residual 12!0!.373 Total 104 8!.80 0 a &redictors- )Constant*. &er/anent (taff. +e% $oan Acco0nts. 1e2it Card (ales. $oan 3ro%th Rate. 1eposit 3ro%th Rate. +e% 1eposit Acco0nts. 1irect (ales "ea/ 2 1ependent 4aria2le- Credit Card (ales df ean ' 23.031 Si!" .000

S(uare 7 131 7.204 22 573.017 2

1.29.4

(alidity of the Model by using 7?8est) The I3test, or an analysis of variance, is used to test the magnitudes of e4plained

variation -&&0/ and une4plained variation -&&E/ with their appropriate degrees of freedom. The hypotheses for the test are as follows@ Null Hypothesis H0 : eta coefficients of all independent variables has 8ero value lternati!e Hypothesis H": *t least + eta coefficient of independent variable has non38ero value

64

6ecision) The I3test shows that the p3value of the test is (K. &ince p3value is less than V T +(K, we will reject the null hypothesis that all of the beta coefficients have 8ero value and accept the alternate hypothesis that at least + beta coefficient has non38ero value.

1.29.#

*oefficients DFE of Inde+endent (ariables

Coefficients :nstandardi;ed Coefficients 5 /Constant0 #82.284 Debit Card .1!8 Sales New Deposit .451 Accounts New Loan #1.1!1 Accounts Direct Sales !. 14 Team Deposit Growth #.28! Rate Loan Growth #21.10! Rate Permanent 10. 8! Staff Standardi;ed Coefficients 5eta .15 .3 8 #.174 .231 #.017 #.20 .721 t #4.210 1.825 3.!01 #1.84! 1.874 #.182 #2.0!8 !.048 Si!" .000 .082 .002 .078 .074 .857 .051 .000

(td. 6rror 1 .54! .0 2 .125 .!2 3.!8 1.573 10.20! 1.81!

1.29.&

Anstandardi.ed Multi+le Linear -egression %Buation before Significance 8est)

) *Credit Card Sales+ , -(2.2(4 . .1#(/1 *Debit Card Sales+ . .4!1/2 *New Deposit Accounts+ 0 1.1#1/3 *New $rowt% &ate+ . 12.1(#/' *Permanent Staff+ oan Accounts+ . #.114/ 4 *Direct Sales "eam+ - .2(#/! *Deposit $rowt% &ate+ 0 21.12#/# * oan

1.29./

Inter+retation of Anstandardi.ed !eta *oefficients

65

The

eta -[/ coefficients are the estimated coefficients of population variables.

Unstandardi8ed coefficients mean that they include the y3intercept in the regression equation, which is often meaningless. 5here else, standardi8ed coefficients are used in standardi8ed regression equation which has no y3intercept. Eebit $ard &ales has an unstandardi8ed beta of .+1) which means that if other variables are held constant, then for every unit of increase in debit card sales the credit card sales will rise by .+1) units. Mew Eeposit *ccounts has an unstandardi8ed beta of .9L+ which means that if other variables are held constant, then for every unit of increase in new deposit accounts, the credit card sales will rise by .9L+ units. Mew !oan *ccounts has an unstandardi8ed beta of 3+.+1+ which means that if other variables are held constant, then for every unit of increase in new loan accounts, the credit card sales will fall by +.+1+ units. Eirect &ales Team has an unstandardi8ed beta of 1.,+9 which means that if other variables are held constant, then for every unit of increase in direct sales team, the credit card sales will rise by 1.,+9 units. Eeposit Drowth 0ate has an unstandardi8ed beta of .3.')1 which means that if other variables are held constant, then for every unit of increase in deposit growth rate, the credit card sales will fall by .')1 units. !oan Drowth 0ate has an unstandardi8ed beta of 3'+.+(1 which means that if other variables are held constant, then for every unit of increase in loan growth rate, the credit card sales will fall by '+.+(1 units.

66

6ermanent &taff has an unstandardi8ed beta of +(.,)1 which means that if other variables are held constant, then for every unit of increase in permanent staff, the credit card sales will rise by +(.,)1 units. ,!erall $e can see from unstandardi-ed e.uation that direct sales team and permanent staff hea!ily influence credit card sales.

1.29.0

Standardi.ed Multi+le Linear -egression %Buation before Significance 8est)

) *Credit Card Sales+ , .1!1/ 1 *Debit Card Sales+ . .31(/ 2 *New Deposit Accounts+ 0 .1'4/3 *New *Permanent Staff+ oan Accounts+ . .231/4 *Direct Sales "eam+ - . 21'/! *Deposit $rowt% &ate+ 0 .221/# * oan $rowt% &ate+ . .'21/'

1.29.4

Inter+retation of Standardi.ed !eta *oefficients)

&tandardi8ed coefficients are used in standardi8ed regression equation which has no y3 intercept, which is often meaningless. Eebit $ard &ales has a standardi8ed beta of .+L, which means that if other variables are held constant, then for every unit of increase in debit card sales the credit card sales will rise by .+L, units. Mew Eeposit *ccounts has a standardi8ed beta of .F,) which means that if other variables are held constant, then for every unit of increase in new deposit accounts, the credit card sales will rise by .F,) units.

67

Mew !oan *ccounts has a standardi8ed beta of 3.+29 which means that if other variables are held constant, then for every unit of increase in new loan accounts, the credit card sales will fall by .+29 units. Eirect &ales Team has a standardi8ed beta of .'F+ which means that if other variables are held constant, then for every unit of increase in direct sales team, the credit card sales will rise by .'F+ units. Eeposit Drowth 0ate has a standardi8ed beta of 3.(+2 which means that if other variables are held constant, then for every unit of increase in deposit growth rate, the credit card sales will fall by .(+2 units. !oan Drowth 0ate has a standardi8ed beta of 3.'(, which means that if other variables are held constant, then for every unit of increase in loan growth rate, the credit card sales will fall by .'(, units. 6ermanent &taff has a standardi8ed beta of .2'+ which means that if other variables are held constant, then for every unit of increase in permanent staff, the credit card sales will rise by .2'+ units. ,!erall $e can see from standardi-ed coefficient that ne$ deposit accounts% direct sales team and permanent staff hea!ily influence credit card sales.

1.29.19 variables)

8?test for statistical significance of individual inde+endent

Coefficients :nstandardi;ed Coefficients 5 Standardi;ed Coefficients 5eta t Si!"

(td. 6rror

68

/Constant0 Debit Card Sales New Deposit Accounts New Loan Accounts Direct Sales Team Deposit Growth Rate Loan Growth Rate Permanent Staff

#82.284 .1!8 .451 #1.1!1 !. 14 #.28! #21.10! 10. 8!

1 .54! .0 2 .125 .!2 3.!8 1.573 10.20! 1.81!

.15 .3 8 #.174 .231 #.017 #.20 .721

#4.210 1.825 3.!01 #1.84! 1.874 #.182 #2.0!8 !.048

.000 .082 .002 .078 .074 .857 .051 .000

5. 8he first hy+othesis test for coefficient of debit card sales is) Null Hypothesis H0: eta coefficient of debit card sales has 8ero value lternati!e Hypothesis H": eta coefficient of debit card sales has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.()'/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.

!. 8he second hy+othesis test for coefficient of ne de+osit accounts is) Null Hypothesis: H0 : eta coefficient of new deposit accounts has 8ero value lternati!e Hypothesis: H" : eta coefficient of new deposit accounts has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(('/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.
69

*. 8he third hy+othesis test for coefficient of ne loan accounts is) Null Hypothesis: H0 : !eta coefficient of ne loan accounts has .ero value lternati!e Hypothesis: H" : !eta coefficient of ne loan accounts has non?.ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(2)/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.

6. 8he fourth hy+othesis test for coefficient of direct sales team is) Null Hypothesis: H0 : eta coefficient of direct sales team has 8ero value lternati!e Hypothesis: H" : eta coefficient of direct sales team has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(29/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant. %. 8he fifth hy+othesis test for coefficient of de+osit gro th rate is) Null Hypothesis: H0 : eta coefficient of deposit growth rate has 8ero value lternati!e Hypothesis: H" : eta coefficient of deposit growth rate has non38ero value 6ecision for significance of *oefficients) 8he null hypotheses -Go/ is not rejected and alternative hypothesis is not accepted, since p3value -.)L2/ \ V -here, VT.+( is the significance level/. &o the beta coefficient is statistically insignificant.
70

7. 8he si:th hy+othesis test for coefficient of loan gro th rate is) Null Hypothesis: H0 : eta coefficient of loan growth rate has 8ero value lternati!e Hypothesis: H" : eta coefficient of loan growth rate has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(L+/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.

<. 8he seventh hy+othesis test for coefficient of +ermanent staff is) Null Hypothesis: H0 : eta coefficient of permanent staff has 8ero value lternati!e Hypothesis: H" : eta coefficient of permanent staff has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(((/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant. 1.29.11 Anstandardi.ed Multi+le Linear -egression %Buation 5fter Significance 8est)
) *Credit Card Sales+ , -(2.2(4 . .1#(/1 *Debit Card Sales+ . .4!1/2 *New Deposit Accounts+ 0 1.1#1/3 *New *Permanent Staff+ oan Accounts+ . #.114/ 4 *Direct Sales "eam+ 0 21.12#/# * oan $rowt% &ate+ . 12.1(#/'

71

1.29.12

Standardi.ed Multi+le Linear -egression %Buation 5fter Significance 8est)

) *Credit Card Sales+ , .1!1/ 1 *Debit Card Sales+ . .31(/ 2 *New Deposit Accounts+ 0 .1'4/3 *New oan Accounts+ . .231/4 *Direct Sales "eam+ 0 . 221/# * oan $rowt% &ate+ . .'21/' *Permanent Staff+

1.29.13

-esidual Statistics

The following table shows the residual statistics.

Residuals Statistics inimum Predicted Value Residual Std" Predicted Value Std" Residual 34.10 #44. 7 #1.525 #1.87 a<imum 243.54 41.73 2.185 1.743 Std" Deviation 120.20 5!.441 .00 .000 .000 20.850 1.000 .871 ean N 30 30 30 30

a 1ependent 4aria2le- Credit Card (ales

Inter+retation of -esidual Statistics) The above table shows the ma4imum, minimum, mean and standard deviation of residual for both standardi8ed and unstandardi8ed equation. *s e4pected the mean of the residuals have turned out to be 8ero. The following table shows the residuals for both standardi8ed and unstandardi8ed regression model. The residuals have been shown for each of the branches.
Un*tan)ar)ize) Re*i)ual* -0.87151 -0.72963 15.93813 -32.26526 1.85073 10.70635 Stan)ar)ize) Re*i)ual* -0.03641 -0.03048 0.66582 -1.34788 0.07731 0.44726 72

22.45799 20.13994 -7.43496 12.84659 -3.47981 29.64442 3.80956 16.1706 -31.13149 41.73325 -26.07014 16.58349 -6.70038 -8.03108 -19.93262 -11.86801 -33.29588 6.03458 -18.70001 16.66203 26.89832 -3.27414 7.27745 -44.96853

0.93818 0.84135 -0.3106 0.53667 -0.14537 1.2384 0.15914 0.67553 -1.30052 1.74341 -1.08908 0.69277 -0.27991 -0.3355 -0.83268 -0.49579 -1.39093 0.25209 -0.78119 0.69606 1.12368 -0.13678 0.30402 -1.87856

1.29.14

=ormal 1robability 1lot The following is the normal probability plot of the regression model. Irom the

diagram, we can clearly see that the model fits nicely along the straight line. This means that the data set is normally distributed and that the model fulfills the normality assumption.

73

+or/al &#& &lot of Regression (tandardi7ed Resid0al 1ependent 4aria2le- Credit Card (ales
1.00

.75

69pected C0/ &ro2

.50

.25

0.00 0.00 .25 .50 .75 1.00

82ser,ed C0/ &ro2

1.21

-evised Model after 6educting Insignificant variables

The revised model e4cludes the deposit growth rate variable as it has been found to be statistically insignificant. Gence the model is re3run is &6&& without using the independent variable in the equation.
74

1.21.1

-evised Model Summary

odel Summar) odel 1 R R S(uare Ad7usted Std" 8rror R S(uare of the 8stimate . 38 .880 .848 23.42 Durbin+ 9atson 2.357

a &redictors- )Constant*. &er/anent (taff. +e% $oan Acco0nts. 1e2it Card (ales. $oan 3ro%th Rate. 1irect (ales "ea/. +e% 1eposit Acco0nts 2 1ependent 4aria2le- Credit Card (ales

Inter+retation of -evised - sBuare) The model summary shows some important indicators of the e4plaining power of the model. The 03square value shows how much change in the dependent variable is caused by the independent variables. %n this case a r3 square value of .)) or ))K means ))K of the change in dependent variable is caused by the seven independent variables. Inter+retation of -evised 5djusted -?sBuare) .n the other hand, the adjusted r3 square value shows how much change in the dependent variable is caused by statistically significant variables. &o in this case, an adjusted r3square value of .)9) or )9.)K means that )9.'K of the change in dependent variable is caused by statistically significant variables, which will be found later in the report. The standard error of the estimate measures the accuracy of the predictions within the regression line, which is around 'F.,F).

1.21.2

-evised 5nalysis of (ariance D5=O(5E The *M.V* table shows the total variation, the e4plained variation and the

une4plained variation -residual/ due to the error. The e4plained variation is denoted as &&0 and the une4plained variation due to residuals is denoted by &&E. The total variation -&&T/ is +(9,)1.) and variation e4plained by regression -&&0/ is ,'F1+.9F2 and variation e4plained
75

by regression error &&E is +'1'L.F1F. &o the e4plaining power of the regression model is good since &&0 is greater than &&E. %f we divide the &&0 with &&T, we get the value of r3 square which we have already found out to be ))K.
AN*VA Sum of S(uares Re!ressio 23!1.437 n Residual 12!25.3!3 Total 104 8!.80 0 df ean S(uare ! 153 3.573 548. 2 ' 28.043 Si!" .000

23 2

a &redictors- )Constant*. &er/anent (taff. +e% $oan Acco0nts. 1e2it Card (ales. $oan 3ro%th Rate. 1irect (ales "ea/. +e% 1eposit Acco0nts 2 1ependent 4aria2le- Credit Card (ales

1.21.3

-evised (alidity of the Model by using 7?8est) The I3test, or an analysis of variance, is used to test the magnitudes of e4plained

variation -&&0/ and une4plained variation -&&E/ with their appropriate degrees of freedom. The hypotheses for the test are as follows@ Null Hypothesis H0 : eta coefficients of all independent variables has 8ero value lternati!e Hypothesis H": *t least + eta coefficient of independent variable has non38ero value 6ecision) The I3test value of ').(9F shows that the p3value of the test is (K. &ince p3value is less than V T +(K, we will reject the null hypothesis that all of the beta coefficients have 8ero value and accept the alternate hypothesis that at least + beta coefficient has non38ero value.

1.21.4

-evised !eta *oefficients

Coefficients

76

:nstandardi;ed Coefficients 5 /Constant0 #82.705 Debit Card .1!! Sales New Deposit .453 Accounts New Loan #1.172 Accounts Direct Sales 7.217 Team Loan Growth #21.!8! Rate Permanent 10.800 Staff

(td. 6rror 18. 7 .08 .122 .!13 3.222 .4 1 1.470

Standardi;ed Coefficients 5eta .157 .400 #.17! .241 #.215 .70

t #4.354 1.85! 3.704 #1. 13 2.240 #2.285 7.34!

Si!" .000 .07! .001 .0!8 .035 .032 .000

a 1ependent 4aria2le- Credit Card (ales

1.21.#

-evised Anstandardi.ed Multi+le Linear -egression %Buation before Significance 8est)

) *Credit Card Sales+ , -(2.'2! . .1##/1 *Debit Card Sales+ . .4!3/2 *New Deposit Accounts+ 0 1.1'2/3 *New Staff+ oan Accounts+ . '.21'/ 4 *Direct Sales "eam+ 0 21.#(#/ # * oan $rowt% &ate+ . 12.(/ ' *Permanent

1.21.& The

-evised Inter+retation of Anstandardi.ed !eta *oefficients) eta -[/ coefficients are the estimated coefficients of population variables.

Unstandardi8ed coefficients mean that they include the y3intercept in the regression equation, which is often meaningless. 5here else, standardi8ed coefficients are used in standardi8ed regression equation which has no y3intercept.

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$onstant eta $oefficient of 3)'.2(L has no meaningful interpretation and hence it is not useful in the model. Eebit $ard &ales has an unstandardi8ed beta of .+11 which means that if other variables are held constant, then for every unit of increase in debit card sales the credit card sales will rise by .+11 units. Mew Eeposit *ccounts has an unstandardi8ed beta of .9LF which means that if other variables are held constant, then for every unit of increase in new deposit accounts, the credit card sales will rise by .9LF units. Mew !oan *ccounts has an unstandardi8ed beta of 3+.+2' which means that if other variables are held constant, then for every unit of increase in new loan accounts, the credit card sales will fall by +.+2' units. Eirect &ales Team has an unstandardi8ed beta of 2.'+2 which means that if other variables are held constant, then for every unit of increase in direct sales team, the credit card sales will rise by 2.'+2 units. !oan Drowth 0ate has an unstandardi8ed beta of 3'+.1)1 which means that if other variables are held constant, then for every unit of increase in loan growth rate, the credit card sales will fall by '+.1)1 units. 6ermanent &taff has an unstandardi8ed beta of +(.) which means that if other variables are held constant, then for every unit of increase in permanent staff, the credit card sales will rise by +(.) units. ,!erall $e can see from unstandardi-ed e.uation that loan gro$th rate% direct sales team and permanent staff statistically hea!ily influence credit card sales.

78

1.21./

-evised Standardi.ed Multi+le Linear -egression %Buation before Significance 8est)

) *Credit Card Sales+ , .1!'/1 *Debit Card Sales+ . .4/2 *New Deposit Accounts+ 0 .1'#/3 *New oan Accounts+ . .241/4 *Direct Sales "eam+ - .21!/# * oan $rowt% &ate+ . .'21/' *Permanent Staff+

1.21.0

-evised Inter+retation of Standardi.ed !eta *oefficients)

&tandardi8ed coefficients are used in standardi8ed regression equation which has no y3 intercept, which is often meaningless. Eebit $ard &ales has a standardi8ed beta of .+L2 which means that if other variables are held constant, then for every unit of increase in debit card sales the credit card sales will rise by .+L2 units. Mew Eeposit *ccounts has a standardi8ed beta of .9 which means that if other variables are held constant, then for every unit of increase in new deposit accounts, the credit card sales will rise by .9 units. Mew !oan *ccounts has a standardi8ed beta of 3.+21 which means that if other variables are held constant, then for every unit of increase in new loan accounts, the credit card sales will fall by .+21 units. Eirect &ales Team has a standardi8ed beta of .'9+ which means that if other variables are held constant, then for every unit of increase in direct sales team, the credit card sales will rise by .'9+ units.

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!oan Drowth 0ate has a standardi8ed beta of 3.'+L which means that if other variables are held constant, then for every unit of increase in loan growth rate, the credit card sales will fall by .'+L units. 6ermanent &taff has a standardi8ed beta of .2(, which means that if other variables are held constant, then for every unit of increase in permanent staff, the credit card sales will rise by .2(, units. ,!erall $e can see from standardi-ed coefficient that ne$ deposit accounts% direct sales team and permanent staff statistically influence credit card sales.

1.21.4 variables)

-evised 8?test for statistical significance of individual inde+endent

Coefficients :nstandardi;ed Coefficients 5 /Constant0 #82.705 Debit Card .1!! Sales New Deposit .453 Accounts New Loan #1.172 Accounts Direct Sales 7.217 Team Loan Growth #21.!8! Rate Permanent 10.800 Staff Standardi;ed Coefficients 5eta .157 .400 #.17! .241 #.215 .70 t #4.354 1.85! 3.704 #1. 13 2.240 #2.285 7.34! Si!" .000 .07! .001 .0!8 .035 .032 .000

(td. 6rror 18. 7 .08 .122 .!13 3.222 .4 1 1.470

a 1ependent 4aria2le- Credit Card (ales

5. 8he first hy+othesis test for coefficient of debit card sales is) Null Hypothesis H0: eta coefficient of debit card sales has 8ero value
80

lternati!e Hypothesis H": eta coefficient of debit card sales has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(21/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.

!. 8he second hy+othesis test for coefficient of ne de+osit accounts is) Null Hypothesis: H0 : eta coefficient of new deposit accounts has 8ero value lternati!e Hypothesis: H" : eta coefficient of new deposit accounts has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.((+/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.

*. 8he third hy+othesis test for coefficient of ne loan accounts is) Null Hypothesis: H0 : !eta coefficient of ne loan accounts has .ero value lternati!e Hypothesis: H" : !eta coefficient of ne loan accounts has non?.ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(1)/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant. 6. 8he fourth hy+othesis test for coefficient of direct sales team is) Null Hypothesis: H0 : eta coefficient of direct sales team has 8ero value
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lternati!e Hypothesis: H" : eta coefficient of direct sales team has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(FL/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.

%. 8he si:th hy+othesis test for coefficient of loan gro th rate is) Null Hypothesis: H0 : eta coefficient of loan growth rate has 8ero value lternati!e Hypothesis: H" : eta coefficient of loan growth rate has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(F'/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant.

7. 8he seventh hy+othesis test for coefficient of +ermanent staff is) Null Hypothesis: H0 : eta coefficient of permanent staff has 8ero value lternati!e Hypothesis: H" : eta coefficient of permanent staff has non38ero value 6ecision for significance of *oefficients) 8 he null hypotheses -Go/ is rejected and alternative hypothesis is accepted, since p3value -.(((/ W V -here, VT.+( is the significance level/. &o the beta coefficient is statistically significant. 1.21.19 -evised Anstandardi.ed Multi+le Linear -egression %Buation 5fter Significance 8est)

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) *Credit Card Sales+ , -(2.'2! . .1##/1 *Debit Card Sales+ . .4!3/2 *New Deposit Accounts+ 0 1.1'2/3 *New Staff+ oan Accounts+ . '.21'/ 4 *Direct Sales "eam+ 0 21.#(#/ # * oan $rowt% &ate+ . 12.(/ ' *Permanent

1.21.11

-evised Standardi.ed Multi+le Linear -egression %Buation 5fter Significance 8est)

) *Credit Card Sales+ , .1!'/1 *Debit Card Sales+ . .4/2 *New Deposit Accounts+ 0 .1'#/3 *New oan Accounts+ . .241/4 *Direct Sales "eam+ - .21!/# * oan $rowt% &ate+ . .'21/' *Permanent Staff+

1.21.12

-evised -esidual Statistics

The following table shows the residual statistics.

Residuals Statistics inimum Predicted Value Residual Std" Predicted Value Std" Residual 34.32 #45.0 #1.522 #1. 25 a<imum 242.08 41.3 2.1!0 1.7!7 Std" Deviation 120.20 5!.435 .00 .000 .000 20.8!5 1.000 .8 1 ean N 30 30 30 30

a 1ependent 4aria2le- Credit Card (ales

Inter+retation of -esidual Statistics) The above table shows the ma4imum, minimum, mean and standard deviation of residual for both standardi8ed and unstandardi8ed equation. *s e4pected the mean of the residuals have turned out to be 8ero.

1.21.13

-evised =ormal 1robability 1lot

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The following is the normal probability plot of the revised regression model. Irom the diagram, we can clearly see that the model fits nicely along the straight line. This means that the data set is normally distributed and that the model fulfills the normality assumption.

+or/al &#& &lot of Regression (tandardi7ed Resid0al 1ependent 4aria2le- Credit Card (ales
1.00

.75

69pected C0/ &ro2

.50

.25

0.00 0.00 .25 .50 .75 1.00

82ser,ed C0/ &ro2

7indings , *onclusion
The findings are the following@ The most important factors that play a significant role in credit card sales are permanent staff and direct sales team. .ther than that, new deposit accounts also have impact on credit card sales. The original unstandardi8ed equation, with statistically significant ? insignificant variables, is@
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) *Credit Card Sales+ , -(2.2(4 . .1#(/ 1 *Debit Card Sales+ . . 4!1/2 *New Deposit Accounts+ 0 1.1#1/3 *New oan Accounts+ . #.114/4 *Direct Sales "eam+ - .2(#/! *Deposit $rowt% &ate+ 0 21.12#/# * oan $rowt% &ate+ . 12.1(#/' *Permanent Staff+

The original standardi8ed equation, with statistically significant ? insignificant variables, is@
) *Credit Card Sales+ , .1!1/ 1 *Debit Card Sales+ . .31(/ 2 *New Deposit Accounts+ 0 .1'4/3 *New &ate+ . .'21/' *Permanent Staff+ oan Accounts+ . .231/ 4 *Direct Sales "eam+ - .21'/! *Deposit $rowt% &ate+ 0 .221/# * oan $rowt%

The revised unstandardi8ed equation, without statistically insignificant variables, is@

) *Credit Card Sales+ , -(2.'2! . .1##/ 1 *Debit Card Sales+ . . 4!3/2 *New Deposit Accounts+ 0 1.1'2/3 *New 12.(/' *Permanent Staff+ oan Accounts+ . '.21'/4 *Direct Sales "eam+ 0 21.#(#/# * oan $rowt% &ate+ .

The revised standardi8ed equation, without statistically insignificant variables, is@

) *Credit Card Sales+ , .1!'/1 *Debit Card Sales+ . .4/2 *New Deposit Accounts+ 0 .1'#/3 *New Sales "eam+ Staff+ oan Accounts+ . .241/ 4 *Direct .21!/# * oan $rowt% &ate+ . .'21/' *Permanent

-ecommendations
The recommendations are as follows@ #anagement should focus on direct sales team and permanent staff quality to ensure good credit card sales, as this has been statistically proven. E !"s management should be aware of negative influence of new loan accounts and loan growth rate on sales of credit cards as they are competing products.
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#anagement should also focus on cross selling of credit cards to new deposit account holders, as this was also statistically proven.

&tatistically, factors such as debit card sales or loan accounts play little role in credit card sales and hence cross selling in such cases must be practiced in limited versions.

.ther factors might also be relevant in credit card sales. &o this report should not be considered as a bible for increasing credit card sales. #arketing strategy and environmental factors also play a key role in the performance of credit cards.

!ibliogra+hy
+. E ! $onsumer 6erformeter #ay '((), published date@ July '((), E ! $onsumer anking Eivision, Ehaka. '. Eurbin 5atson, 5ikipedia.com, <http://en.wikipedia.org/wiki/DurbinWatson_statistic>, access date@ '(th *ugust, '((). F. Eurbin 5atson Table, <http://hadm.sph.sc.edu/courses/J !"/Dw.htm#>, access date@ '(th *ugust, '(().
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4. !inear 0egression, $a#i%ornia &tate 'ni(ersit) website*

<www.math.csusb.edu/%acu#t)/stanton/m+"+/regress/regress.htm#>, access date@ '(th ,ugust* +--..

5. !inear 0egression, Rork University website, <www.stat.)a#e.edu/$ourses/!// /./!-!/#inreg.htm>( access date@ '(th ,ugust* +--..

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