Foreign Trade & Remittance Division

Of

AB Bank Limited
 Foreign Trade & Remittance Division of AB Bank Limited

Internship Report
On
Foreign Trade & Remittance Division of AB Bank Limited

Submitted To
Department of Finance
Faculty of Business Studies
Jagannath University

Submitted By
Riad Ibnay Hyder
ID: B-150203034
Batch – 10th
Session: 2015-2016
Program: BBA
Department of Finance
Jagannath University

Supervised By

SK. Alamgir Hossain

Assistant Professor
Department of finance
Jagannath University

Date of Submission: 2 March, 2023

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 Foreign Trade & Remittance Division of AB Bank Limited

LETTER OF TRANSMITTAL

2 March, 2023
To
SK. Alamgir Hossain
Assistant Professor
Department of finance
Jagannath University

Sub: Submission of internship Report on Foreign Trade & Remittance Division of AB Bank
Ltd.

Dear Sir,

It gives me immense pleasure to submit the internship report on “Foreign Trade & Remittance
Division of AB Bank Limited” as partial requirement of Bachelor of Business Administration
(BBA) program. The preparation of report has given me the opportunity to acquaint with the
corporate environment of AB Bank Limited. The experience of this internship study will be an
asset in my career. I hope that you will appreciate my enthusiasm and find this report up to your
expectation.
Thanks for your co-operation and guidance to prepare this report and know about functions of the
AB Bank Ltd. in details.

Sincerely yours

…………………………..
Riad Ibnay Hyder
ID: B-150203034
Batch – 10th
Session: 2015-2016
Program: BBA
Department of Finance
Jagannath University.

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 Foreign Trade & Remittance Division of AB Bank Limited

Certificate of Supervisor

This is to certify that the internship report on “Foreign Trade & Remittance Division of AB
Bank Limited” has been submitted for the award of the degree of Bachelor of Business
Administration (BBA) from Department of Finance, Jagannath University.
It is carried out by Riad Ibnay Hyder bearing ID: B150203034 satisfactorily under my
supervision.
He has done his work under my supervision and guidance. He has tried his best to do this
successfully. I hope, this study will help him in the future to build a bright career.
He is permitted to submit the Internship Report.
Wish his best to success in every stage of life.

…………………………………..
SK. Alamgir Hossain
Assistant Professor
Department of finance

Jagannath University

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 Foreign Trade & Remittance Division of AB Bank Limited

Declaration of Student

I, Riad Ibnay Hyder, the student of Bachelor of Business Administration (BBA) 10th Batch
bearing ID: B150203034 from Department of Finance, Jagannath University would like to
solemnly declare here that the internship report “Foreign Trade & Remittance Division of AB
Bank Limited” has been authentically prepared by me.

While preparing this internship report, I did not violate any copyright custom/rule intentionally. I
tried my best to grab a clear idea on the main features of the topic and tried to expound it in my
own way. I have gone through the open source and tried to understand the themes of the report
circulated.

I am further declaring that, I did not submit this report anywhere for awarding any degree, diploma
or certificate. This report is only prepared towards the partial fulfillment of the requirements for
BBA program not for any other purpose.

…………………………………

Riad Ibnay Hyder

ID: B-150203034
Batch – 10th
Session: 2015-2016
Program: BBA

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 Foreign Trade & Remittance Division of AB Bank Limited

Acknowledgement

First and foremost, I am grateful to Almighty Allah for blessing me with good health and
persistence of mind to complete the requirements for the degree and also for the opportunity to
work as an intern at AB Bank Limited, North South Road Branch and giving me adequate
patience and knowledge to prepare this report.

I would like to express my sincere gratitude to my faculty supervisor SK. Alamgir Hossain,
Assistant Professor, Department of Finance, Jagannath University, for acting as a mentor and
showing me the right direction whenever I started going off-track.

I am thankful to Mr. Juglul Shah, SAVP and Branch Manager, North South Road Branch,
AB Bank Limited. It would be quite difficult for me to complete this report up to the mark without
his guidance and support.

And also, I am grateful to all the friendly and efficient officials of AB Bank Limited North South
Road Branch for providing me their valuable time, co-operation, suggestion with essential
information.

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 Foreign Trade & Remittance Division of AB Bank Limited

Executive Summary

The operations of commercial banks play a major role in the economic growth of a nation. The
horizontal functioning of banks is crucial to the growth of our agricultural, industrial, and
economic sectors, particularly in a nation like Bangladesh. Hence, we must guarantee that this
sector operates efficiently and effectively.

One of the most successful banks in Bangladesh, AB Bank Ltd. is the first private sector bank
operating under a joint venture with Dubai Bank Ltd. Giving clients access to all financial services
at their doorsteps is the bank's primary goal. In today's world, the bank manages foreign exchange
transactions.

.
This internship report aims to provide readers a thorough understanding of the "International Trade
& Remittance Division of AB Bank Ltd" sections. One of the crucial operations of the bank is
foreign trading. It is essential to the nation's overall economy. Import and export sections are
included under "Foreign Trades," while the "Foreign Remittance" part includes both inbound and
outbound remittance. The entire method, complete with all necessary information, has been
disclosed in the report. Indeed, all the phrases and processes are given. There are multiple chapters
in this report. The introduction is presented in chapter 1. Chapter 2 provides an overview of AB
Bank Ltd., outlining its background, organizational structure, mission, goals, and ambitions I
outline my actual responsibilities and job description in chapter b3. The project's "International
Trade and Remittance Division" is presented in Chapter 4. This section provides descriptions of
the export, import, and remittance sections. Export section include the export process. Major
export products and countries are listed in depth in the export process. The import section presents
the import process, key import items, and nations. The types of remittance, their purposes, and
available remittance services are all mentioned in the section on remittances. The trend analysis of
export, import, and remittance is presented in Chapter 5 utilizing data from the last 22 years and a
graphical display to demonstrate the actual situation. The final chapter 6 contains suggestions and
conclusions based on the overall experience of the internship as well as the actions and
performance of AB Bank Ltd. References are provided at the conclusion of the paper.

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Contents
LETTER OF TRANSMITTAL .............................................................................................. 3
Certificate of Supervisor .......................................................................................................... 4
Declaration of Student ............................................................................................................. 5
Acknowledgement .................................................................................................................... 6
Executive Summary ................................................................................................................. 7
Chapter1.Introduction: .......................................................................................................... 10
1.1 Origin of the report: ............................................................................................................ 10
1.2 Background of the Study: ................................................................................................... 10
1.3 Objectives: .......................................................................................................................... 10
1.4 Methodology: ...................................................................................................................... 10
1.4.1. Data collection: ............................................................................................................... 11
1.4.2. Analytical Tools Used:.................................................................................................... 11
1.5 Scope: .................................................................................................................................. 11
1.6 Limitations the study:.......................................................................................................... 12
Chapter2.The organizational Overview ............................................................................... 13
2.1 Historical Background: ....................................................................................................... 13
2.2 Structure of AB Bank:......................................................................................................... 14
2.3 Mission, Vision, Objectives and Strategies: ....................................................................... 15
2.3.1Mission Statement: ............................................................................................................ 15
2.3.2Vision Statement: .............................................................................................................. 15
2.3.3Objectives of the Bank: ..................................................................................................... 15
2.3.4Long term Objective: ........................................................................................................ 15
2.3.5Short term Objective: ........................................................................................................ 15
2.3.6Strategic and Financial Objectives:................................................................................... 15
2.3.7Strategic Objectives: ......................................................................................................... 16
2.3.8Financial objectives: ......................................................................................................... 16
CHAPTER 03. Job Description ............................................................................................ 17
3.1 My Specific Task .............................................................................................................. 18
3.2 My Responsibilities and Duties ........................................................................................ 18
CHAPTER 04. Foreign Trade and Remittance Division .................................................... 19

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4.1. Export Section .................................................................................................................... 19

4.2. Import section .................................................................................................................... 19
4.3. Remittance section ............................................................................................................. 19
A) Concept........................................................................................................................... 19
B) Methods of Payment in International Trade ................................................................... 20
C) Letter of Credit (L/C) ..................................................................................................... 21
Procedure to open a Letter of Credit (From import and export perspective): ........................... 21
4.1 Export Section ..................................................................................................................... 23
Export ........................................................................................................................................ 23
4.1.1. Export Procedure: ....................................................................................................... 24
4.1.2. Major Exporting Products ........................................................................................... 27
4.1.3. Major Exporting Country ............................................................................................ 28
4.2. Import Section .................................................................................................................... 29
Import .................................................................................................................................... 29
4.2.1. Import Process: ........................................................................................................... 30
4.2.2. Major Importing Products: .......................................................................................... 35
4.2.3. Major Importing Countries: ........................................................................................ 35
4.3 Foreign Remittance Department ......................................................................................... 37
A. Inward Foreign Remittance .............................................................................................. 38
B. Outward Foreign Remittance ........................................................................................... 39
4.3.1 Remittance Service Option .......................................................................................... 39
CHAPTER 05. Performance Analysis .................................................................................. 39
5.1 Export Trend Analysis ...................................................................................................... 40
5.2. Import Trend Analysis: ...................................................................................................... 42
5.3. Trend Analysis of Remittances .......................................................................................... 44
CHAPTER 06.Recommendation and Conclusion ............................................................... 46
6.1. Recommendation: .............................................................................................................. 46
6.2. Conclusion ......................................................................................................................... 47
References ............................................................................................................................... 47

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Chapter1.Introduction:

1.1 Origin of the report:

This report is the end result of the three-month internship program with AB BANK. The
completion of this report's preparation and submission is essential to completing Jagannath
University's Bachelor of Business Administration (BBA) academic requirements.

1.2 Background of the Study:

The Bangladesh Bank, which serves as the country's central bank, fully regulates the banking
sector. However, every bank has a unique management structure, set of procedures, and set of
rules. It results in various banks' viewpoints on the same subjects & terms. Regulating banks for
their various practices presents challenges for the central bank. Therefore, Bangladesh Bank
made the decision to create an exclusive set of guidelines known as "INDUSTRY BEST
PRACTICE" for all banks. A core area of concentration of this study is Foreign Trade Division,
so this study is concerned with the specific area of managing Import & Export and remittance
procedures to promote logistic support in business.

1.3 Objectives:

The study's primary goal is to gain a clear understanding of the operation and role of the Foreign
Trade Division. According to the study's broad goal, the specific goal could be stated as follows:

1. To be aware of the bank's foreign trade system.

2. To determine the risk associated with international trade proceedings.
3. To identify the issues with import, import procedures, trend analysis of import.
4. To gain knowledge about export process, trend analysis of export.
5. To be aware of the remittance regulations and flow of remittance

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1.4 Methodology:
The study is performed based on the information extracted from different sources collected by
using a specific methodology. The detailed is given below:

1.4.1. Data collection:

Sources of data are as follow:

 Face to Face conversation with the respective officers and staffs

 Sharing practical knowledge of officials.
 Annual Report of AB Bank.
 Audit Reports
 Relevant file study provided by the officers concerned.
 Different relevant Website
 Internet and various study selected reports.

1.4.2. Analytical Tools Used:

To analyze the collected data chart & graph has been used for better presentation of financial
data.

1.5 Scope:
The banking system plays a significant role in the economy of a country. A banking institution
is crucial to contemporary society. It is essential to a nation's economic growth and serves as the
backbone of the money market in a developed nation. The banking industry has changed
significantly in recent years as a result of regulation, technological advancement, globalization,
etc. The banking industry in Bangladesh is taking its time implementing these changes. In order
to thrive in these dynamic environments, professionalization of banking services is just as
important as the development of the necessary infrastructure.

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1.6 Limitations the study:

From the beginning to end, the study has been conducted with the intention of making it as a
complete and truthful one. However, many problems appeared in the way of conducting the
study. During the study, it was not possible to visit the whole area covered by the bank although
the financial statements and other information regarding the study have been considered. The
study considers following limitations:

 This report suffers from a narrow data range for analysis.

 All the concerned personnel of the bank have not been interviewed.
 Lack of experience.
 The time period for this study was short.
 Inadequacy and lack of availability of required Current data.
 The documentation part of the Letter of Credit with regard to export and
import is quite complicated and huge formalities are maintained.

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Chapter2.The organizational Overview

2.1 Historical Background:
AB Bank Limited, the first private sector bank under Joint Venture with Dubai Bank Limited,
UAE incorporated in Bangladesh on 31st December 1981 and started its operation with effect
from April 12, 1982. Dubai Bank Limited (name subsequently changed to Union Bank of the
Midlist Limited) decided to off-load their investment in AB Bank Limited with a view to
concentrate their activities in the UAE in early part of 1987 and in terms of Articles 23A and
23B of the Articles of Association of the Company and with the necessary approval of the
relevant authorities, the shares held by them in the Bank were sold and transferred to Group "A"
Shareholders, i.e., Bangladeshi Sponsor Shareholders. As of December 31, 2021; the total Capital
and total Equity of the Bank are BDT 35,395 million and BDT 24,307 million respectively. The
Sponsor and directors hold 31.67% of the Share Capital, the General Public Shareholders hold
43.20%, local institutions hold 32.15% Govt. of Bangladesh hold .57% and foreign institutions,
non-resident Bangladeshi hold .91% and .21% respectively Shares of AB Bank Ltd. Since
beginning, the bank acquired confidence and trust of the public and business houses by rendering
high quality services in different areas of banking operations, professional competence and
employment of the state of art technology. During the last 40 years, AB Bank Limited has opened
105 Branches in different Business Centers of the country, one foreign Branch in Mumbai, India,
two Representative Offices in London and Yangon, Myanmar respectively and also established
a wholly owned Subsidiary Finance Company in Hong Kong in the name of AB International
Finance Limited. To facilitate cross border trade and payment related services, the Bank has
correspondent relationship with over 220 international banks of repute across 58 countries of the
World. AB Bank Limited, the premier sector bank of the country is making headway with a mark
of sustainable growth. The overall performance indicates mark of improvement with Deposit
reaching BDT 298373 million and net profit after tax BDT 641million which places the Bank in
the top tier of private sector commercial banks of the country. On account of Foreign Trade, the
Bank made a significant headway in respect of import, export and inflow of foreign exchange
remittances from abroad.

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2.2 Structure of AB Bank:

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2.3 Mission, Vision, Objectives and Strategies:

2.3.1Mission Statement:
"To be the best performing bank in the country"

2.3.2Vision Statement:
"To be the trendsetter for innovative banking with excellence & perfection"

2.3.3Objectives of the Bank:

To exceed customer expectations through innovative financial products & services and establish a
strong presence to recognize shareholders’ expectations and optimize their rewards through
dedicated workforce.

2.3.4Long term Objective:

Keeping ahead of other competitors in productivity and profitability.

2.3.5Short term Objective:

To attain budgetary targets fixed in each area of business

2.3.6Strategic and Financial Objectives:

In this report, the major area of commercial banking has been covered is Foreign Exchange Section
which comprises of mainly following departments.

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2.3.7Strategic Objectives:

 A bigger market shares

 Broader and more attractive services and products than rivals.
 Superior customer service
 Wider geographic coverage than rivals

2.3.8Financial objectives:

 Growth in earnings
 Higher dividend
 A more diversified revenue base

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CHAPTER 03. Job Description

For BBA students, the internship program is one of the most crucial components. The entire
program lasts for 12 weeks (3 months), providing students with the best opportunity to learn
about organizational procedures and learn how to function in their workplace environment.
These lessons could help the student become professional, sincere, a good communicator,
punctual, and smart in many different ways.
I completed my internship at AB Bank Limited to complete my graduation (North South Road
Branch). Being given the opportunity to work as an intern in a reputable bank in Bangladesh
was truly fantastic. I spent three months there working in a different department. The divisions
of this Branch are as follows.
1. General Banking division

2. Cash Transaction division

3. Credit Management division

4. Foreign Trade and Remittance division

1.General Banking division 2.Cash Transaction division

Job
Description

3.Credit Management 4.Foreign Trade and

division Remittance division

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3.1 My Specific Task

At the beginning, I worked general banking sector. There, I opened different accounts of the
clients. I guided clients that how to open accounts we need some documents for verifying as well
as I opened their accounts manually. Next, I shifted to credit sanction where I know about credit
policy, process and sanction of credit, bad debt. In cash transaction division I come to know about
transaction process, activities of cash counter etc. Then I shifted to foreign trade section. Here the
department is composed of export, import section. Here the officials give me knowledge about
process of export, import. How to issue orders, compose import LC (letter of credit) and making
of FDD (foreign demand draft). Besides, sometimes, I gave entry their import LC in their register
book. In remittance section, I came to know about their remittance mode, channel of transferring
remittance they use.

3.2 My Responsibilities and Duties

My responsibilities and duties were to come in just time and I worked their assigned job. I always
completed my daily specific task. Besides, it was my also responsibilities to complete every single
task timely and properly.

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CHAPTER 04. Foreign Trade and Remittance Division

Foreign trade and remittance are a very important part of a bank. It does not create money. It
actually works as an intermediary for business and transaction purpose with foreign countries.
Without commercial banks, the international finance and import-export industry will not exist. AB
Bank always tries to provide a better service to their clients from the beginning to the end. Foreign
trade department mainly earns more revenue than other department. So, it is not only bringing
more money to the bank but also enhances our economic growth and conditions. Foreign Trade
and remittance division consist of:

4.1. Export Section

4.2. Import section

4.3. Remittance section

A) Concept
If a person tries to know or learn about foreign trade activities, he or she must be clear about
some concept of foreign trade department.
• Opening Bank or Issuing Bank: A bank always issue or open credit to the exporter
after getting the buyer’s order.

• Importer or Buyer: Importer or buyer both are same thing. Bank does open credit by
request of the applicants or buyer.
• Exporter or Beneficiary: Bank helps exporter to give credit. So, beneficiary has
liability because bank does finance to exporter.

• Advising Bank: According to the demand of the issuing bank the bank which advices
hat is called advising bank.

• Nominated Bank: The bank which has sufficient credit called as Nominated Bank. If
banks do not mention in the credit as nominated bank, all banks will be nominated
bank.

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B) Methods of Payment in International Trade

Payment method plays an important role in international trade. Trade has a risk. The
important part of trade is getting payment on time and properly. Otherwise, there is no value
doing a business. Appropriate payment method helps a business to expand. Besides, it helps
a bank to build a relationship with their client. Moreover, appropriate payment method
minimizes the payment risk. So, every individual business uses their suitable method.
o Advance Payment: When importer gives order to the exporter, it has time limit and
specific delivery time or shipment time. If importer pays before the shipment that is
called advance payment. This is less attractive to the importer because it has risk.
Importer thinks if they pay advance, exporter will not work seriously. It can create
unfavorable circumstances.
o Consignment Payment: Consignment is totally opposite of advance payment. Here,
importer gives payment after the shipment of the product and also when the products
have sold by the foreign delivery to the end customer. Exporter does not want
consignment payment because it has exporter’s high risk. This consignment payment
method uses in developed countries.
o Documentary Collections: Documentary collection is very famous payment method.
Most of the country’s businesses follow this payment method. It is enough secure.
Here, importer and exporter both make an agreement between them according to
shipping documents such as original bill of lading, packing list, certificate of origin,
bill of exchange, pro-forma invoice etc.
o Letter of Credit (L/C): In today’s world letter of credit is most popular payment
method of international trade. Most of the countries practice this method. Importer’s
bank gives assurance to the supplier that bank will pay written amount in the
agreement, if exporter meets the terms and conditions of the letter of credit. The first
job of Letter of credit is it plays an intermediary role to complete the trade transactions.
The bank only deals with documents even they do not inspect the goods or
commodities. These total rules are applicable in whole world. It is produced by the
International Chamber of Commerce and Industries (ICC).

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C) Letter of Credit (L/C)

L/C maintains strong relationship between buyer and seller. Letter of credit basically a term
that means a bank does finance to the business for the exporters and importers personal sake.

L/C is more secure method than others. The bank advises credit is known as advising bank
as well as the bank what opening the credit is called the L/C opening or issuing bank. Besides,
the bank which has enough money called nominated bank. If nominated banks are not
mentioned, all the banks will be nominated.

L/C is a liability of the exporter which a bank gives advantage of the exporter to do business
on behalf of the importer. Importer and exporter both are getting benefits directly or
indirectly.

Procedure to open a Letter of Credit (From import and export perspective):

The cart below shows how participants are involved in the method of opening and payment
of L/C:

Figure: Procedure to open a Letter of Credit (From import and export view)

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o The applicant and the beneficiary negotiate terms and conditions of the letter of credit
as per the agreement.
o The Applicant applies to the issuing bank to submit an application.

o The issuing bank wants some documents from the applicants:

▪ Importer and exporter both do agreement between them.

▪ Invoice both pro-forma and commercial
▪ Purchase order. After the inspection all the documents the bank issues the L/C and
forwards it to the Advising Bank.
After all the inspections, the bank forwards them to the advising bank. Then, advising bank
does the following works.

• Advising bank check the papers as well as advices the LC to the beneficiary.
• The beneficiary matches them with the main or original contract to identify any major
mistakes.
• If no mistakes found, the beneficiary draws the plan and presents too the advising bank.
• Advising bank inspects all the papers with references to terms and conditions of the
forwards them to the issuing bank.
• The opening bank confirms that the documents comply with the letter of credit and
makes payment as per types of LC. It can be sight or deferred.
Classification of L/C:
There are three types of Letters of Credit in AB Bank Limited:

• Sight LC
• Deferred LC
• Back-to-Back LC
• Sight L/C: LC payment should be made within five working days after receiving the
documents from the seller.

• Deferred L/C: LC payment should be made on shipment date or due date. It is normally
open for 120, 90, 60 days. So, it is totally depending on the demand of the party.

• Back-to-Back L/C: Back-to-Back LC usually wants to open the exporter to import

goods to produce their ordered goods and to deliver. Exporter opens back-to-back LC

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against or you can say to keep lien their master LC or original LC. It can be 80% of the
master or original LC.
Modes of Payments L/C:
The modes of export’s payments under the LC:

• Sight payment
• Deferred payment
Sight payment: The payment clears immediately when importer will get back the imported goods
or products appropriately.

Deferred Payment: By the negotiation between the buyer and seller the payment time can
be fixed such as: 120 days, 90 days, as well as 60 days. So, the payment must be cleared after
a specific period of time which time will be selected this is depends on the negotiations
between them.

4.1 Export Section

Export
Act of 1950 states that import and export controls help the nation's export trade keep up.
Before and after shipping the products, an exporter must follow a number of formal
procedures. When a nation sells its goods to another nation after satisfying its own demand,
this is referred to as export. Large contributions are made to the national economy of our
nation by export businesses.

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4.1.1. Export Procedure:

Step 01 • Advising L/C

Step 02 • Issuing of EXP

Step 03 • Collection of Document

Step 04 • Realization of Export Proceeds

Step 05 • Reports

Step 06 • Issuing Realization Certificate

Step-1: Advising L/C

Advising LC is the first condition of export LC which is mandatory to send an advising letter
to the beneficiary. It shows that LC has been issued. The advising LC step is not required in
case of advance payment and documentary collections.
Issuing bank sends two copies of LC. One copy is given to the beneficiary and the other one
is retained by the branch.

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Step-2: Issuing of EXP

All export details and in formations have in the EXP form like unit price, quantity, bill of
lading no. etc. The exporter must be registered with the CCI and E before certifying any
export form.
The branch must ensure the exporter’s registration. It is the responsibility of the branch.
The following information is given to the EXP form:
1. Name & address of the authorized seller.
2. Particulars of the goods to be exported with code.
3. Country of destination.
4. Port of destination.
5. L/C value in foreign money.
6. Terms of sale.
7. Name and address of the importer.
8. Name of caring vessel.
9. Bill of lading.
10. No. & date.
11. Port of shipment.
12. Land custom post.
13. Shipment time.
14. Name and address of the exporter.
15. Sector (Public or Private) under which the exporter falls.

Step-3: Collection of Document

The exporters do shipment of the ordered products and another important task is submitting
all preparing documents according to the contract. Within 14 days of shipment, the exporter
must all the copies of EXP from along with the other documents covering exports to the
branch.

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The required documents are being prepared by the exporters which mentioned in LC. Such
as:
1. Bill of exchange: the process of collection of payment from the importer.
2. Bill of Lading: a paper which is issued by the company or its agent.
3. Insurance policy: Insurance of the products where the insurance company will pay the
damages if any damages happen on the transmission period.
4. Certificate of origin: Declaration of the real place of the goods or real producer.
5. Inspection certificate: Determines products accuracy.
6. Commercial invoice: List of total product’s description.
7. Packing list: List of details of the goods contained in a package. It helps the customs to
identify each package individually.
8. Full set of shipping document: The documents for shipping certified from customs
house.

These papers have to be submitted to the respective department officer for negotiation
purpose.
Then after checking the validation of the papers, it will be delivered to the importer bank.

Step-4: Realization of Export Proceeds

The money will only be sent out if the importer bank receives all the documents. The
nominated bank gets 120 days to realize the proceeds of the export. The time 4 months is
declared by the Bangladesh Bank within which the exporter has to accept all the foreign
exchange proceeds. If any delay beyond the period happens without the authority from the
Bangladesh Bank, the Bank can create payment by passing the Vouchers of Accounting to
the exporter and they will be responsible under FER Act, 1947.

Step-5: Reports
The Bank certifies all the reverse of the triplicate copy of the form and forwards to the
Bangladesh Bank after clearing the payment with the return. Another copy of the documents
is preserved by the branch for security and evidence. Within fourteen days of shipment. The
nominated bank has to report to Bangladesh Bank about the duplicate EXP form.

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Step-6: Issuing Proceeds Realization Certificate (PRC)

At the end Proceeds Realization Certificate (PRC) to the exporter is issued by the nominated
bank. The exporter gets the bank certificate after the proceeds are certified. The standard
format of the Proceeds Realization Certificate (PRC) Issued by Bangladesh Bank must be
maintained to get reduction from the exporters’ income tax.

4.1.2. Major Exporting Products:

Ready-made Garments & Knitwear, Home Textile Products, Leather and Leather Goods, Jute
and Jute Products, Agricultural Products, Fish and Shrimps, Light Engineering Industries,
Ceramic Table wares, Pharmaceuticals, Toiletries and Cosmetics, Software and ICT products,
Ships and vessels, Electronics and electrical products etc.

This graphical view is just for highlighting the major products. All year it will not be same.
This graph is based on the 2020-2021 fiscal year data. As we know our main exporting product
is clothing accessories, so the major percentage covers by these products.

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4.1.3. Major Exporting Country:

The top export destinations of Bangladesh are Germany, the United States, the United
Kingdom, Spain and France. (OEC, n.d.). And also, are Belgium, Italy, Netherlands, Canada,
Japan, China, Turkey, Denmark, India, Korea Republic, Hong Kong, Ireland, Singapore,
Pakistan etc.

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4.2. Import Section

Import
If a country orders an amount of goods or services from another country and ships the goods
or services to the country, then it is called import of goods or services. The Import Registration
Certificate (IRC) of the goods to the importer is given by the office of chief controller of
import and export according to the control act of import and export, 1950. Then a Letter of
Credit Approval (LCA) has to be obtained by the person or organization importing the goods.

Import Business of AB Bank Ltd. increased by 48.78% to Tk. 4,862 crore in 2021 from Tk. 3,268
crore in 2020. Import business of AB covers areas like industrial raw materials, food items,
chemicals, medicines, textiles, capital machineries etc.

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4.2.1. Import Process:

Step 01 •L/C issuing

Step 02 •Transmitting L/C
Step 03 •Amendment
Step 04 •Document checking

Step 05 •Lodgment
Step 06 •Retirement and Report

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Step-1: L/C issuing

This is the first conditions to import issuing the L/C. Letter of credit is the consistent sources
of both the party’s importer and exporter in order to get payment properly in the right time.
The transaction originates when the exporter in London and the importer in Dhaka enter into
an agreement of sale. The contract covers all important particulars like value and also quantity
of goods, the due date for shipment, method of payment etc. on the conditions are that a letter
of credit should be opened in favor of the exporter.

For opening L/C is contain a required documents which is given below:

• L/C application forms what contains the details about applicant and beneficiary. Total
L/C amount, country of origin means the products manufacturing areas, types of payment
moods like at sight, DAF, CFR, FOB, Negotiation, and Acceptance, Port of shipment, and
date of shipment etc. Insurance cover statement policy also had been mentioned amount,
rate of dollar, equivalent TK. of BD, margin, charges, commission and also other charges.

• IMP form is containing H.S code (Harmonize system code), it implies to categories of
manufactured goods. Quantity of commodities, Invoice value, Registration no. of L/C
authorization form with Bangladesh Bank Registration unit. And the carrier’s name like
air or boat and other terms and circumstances. The IMP forms should be submitted in
duplicate by the importer.

• LCA form (Letter of credit authorization) what includes different rules and regulation
about the imported items and imports. Letter of Credit Authorization issued by the
importer’s bank is essential for import purpose.

• Contract form that includes details contract between the parties.

• Charge paper.

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After complete all above mentioned properly then have to fulfill other papers and documents
with verify of the self-signature and after that submit it to bank.
Others paper and documents:

• Import Registration Certificate (IRC).

• Trade License.
• Registered Deed (Only for Partnership firms).
• Income Tax Declaration of TIN no.
• Membership Certificate.
• Photograph.
• Memorandum of Association (Only for Limited companies).
• Insurance cover note copy and money receipt.
• Pro-forma Invoice copy.

Step-2: Transmitting L/C

After issuing the L/C application and L/C authorization transmit to the advising bank.
Letter of credit can be transmitted to the advice bank by three moods. There are Telex,
Courier, and SWIFT (Society for worldwide inter telecommunication network).
The AB Bank Ltd. Uses mainly the SWIFT when L/C is disposed in the following manner:

• First two copies sent to the advising bank original for beneficiary and second copy for
advising bank.
• One copy is sent to the importer.
• One copy is sent to the Bangladesh Bank.
• One copy is sent to the C.C.I. &E (Chief controller of Imports and Exports).
• One copy is retained as office copy.
• One copy to Head office.
Exporters receive the L/C through the advising bank. Receiving L/C, exporter produce the
commodities according to the requirements and ships it before due date. If any amendment is
compulsory, exporter contacts with the importer. If the importers agree to do so, then the
issuing bank issue amendment for the L/C.

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Step-3: Amendments
It may be felt essential to alter some of the conditions of the credit or delete some or add some
more, after a credit has been issued. All these modifications are communicated throughout
the same bank that advised the credit. There can be additional one amendment to the credit.
The credit issuing bank intends that all the amendments from an integral part of the unique
credit issued.
Amendment can be done for various reasons under the rule of foreign exchange the reason is
given below:

• Extension of date of shipment.

• Change of specification of commodities, price or quantity to be imported.
• Extension of draft amount within L/C limit.
After shipments of the commodities, the exporters prepare the required papers and submit it
to advising bank for payment. Later than shipment, exporters present the following documents
for negotiations.
• Bill of Exchange
• Bill of Lading
• Packing list
• Insurance policy
• Inspection certificate
• Commercial invoice

Step-4: Document Checking

When issuing bank received the whole document from nominated bank then they need to
check for further documentation process. Followings are the significant documents to be
obtained by the issuing bank after receiving the document from the nominated bank:

• Approval by Head office in case of new importers.

• Invoice of Pro-forma.
• Maintain standard format of L/C when filled and verification of the signature of the
applicant.
• If Guarantor’s signature is applicable, then verifying the signature of the Guarantor.

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• Attachment of Membership Certificate from chamber of commerce / Business

association and proof of insurance premium payment with insurance cover note and
money receipt.

• Insurance checked for value (Insured amount must be indent/ PI value plus 10%)
validity, goods, mode of transportation, shipment from and to etc.

• IMP form duly signed.

• Update suppliers or Beneficiary’s credit report.
• LCA (Letter of Credit Authorization form) properly fill up and duly signed.
• Valid IRC held.
• VAT registration certificate.
• Up to date income tax certificate.
• Check the goods that are not banned or restricted item as per import policy.
• Check the country of origin for the particular goods.
• Margin including all L/C related charges realized.

Step-5: Lodgment
Lodgment means payment of import bills or move of funds for import bills. Here L/C issuing
bank will organize to make payment against L/C through SWIFT. Through SWIFT a telex
message is transmitted to the correspondent bank to ensure that payment has made. After
checking the import-negotiating paper, if no discrepancy is found then it treated to be accepted
after the end of five banking days for the day of receipt of the paper. If any discrepancy is
found then the bankers inform it to the importer whether is accepted the bill with discrepancies
or not. If the importer does not accept, the bankers inform it to the nominated bank within
seven banking days from the date of receipt of the papers, otherwise it is treated to be accepted
and the opening bank must bound to pay.

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Step-6: Retirement & Reports

The branch makes the retirement vouchers to imitate the amount of cost and other charges
from importer and adjustments of margin after the payment of the import bill. Therefore, the
documents are given to the importer against proper acceptance after certificate.
Steps are involved in retirement. Those are:

• If it has any interest, it must calculate.

• It must entry in the register.
• It must fill of the office copy.
• Endorsement is made on the back of the bill of exchange as usual payment.
• Acknowledgement took on the office copy from the importer in his authorized agent.

Report is very important in IMP form. Real copy of IMP form forwards to the Bangladesh
banks another copy keeps in the branch.

4.2.2. Major Importing Products:

Rice, Wheat, Milk Cream, Spices, Oil Seeds, Edible Oil, Pulses Al Sorts, Suger, Woven Cotton
Fabrics, Palm Oil, Cell Phones, Video Recorders & Radio Transceivers, Television, Radio &
Assessor Parts, Knitted & Crocheted Fabrics, Synthetic Staple Fiber Yarn, Machines For
Preparing Fibers & Yarns, Cement, Washers & Dryers, Sewing Machines, Iron & Steel,
Soybean Oil, Leguminous Vegetables, Non-Crude Oil, Cotton, Aircraft Engines, Slide
Fasteners & Parts,
Synthetic Coloring Matter, Zinc, Coated Paper, Nitrogenous Fertilizers, Semi Trucks, Buttons,
Synthetic Filament Yarn, Phosphatic Fertilizers, Air & Vacuum Pumps, Weaving Machines,
Labels & Badges, Medicines in Doses, Engine Parts, Insulated Wire & Cable, Insecticides,
Aluminum, Air Conditioners, Water Heaters, POL, Chemical, Pharmaceutical Products,
Plastic and Rubber Articles, Staple Fiber, Textile, Raw Cotton Etc.

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4.2.3. Major Importing Countries:

China, India, Singapore, Indonesia, Japan, Korea, Malaysia, Brazil, Kuwait, United States,
United Arab Emirates, Germany, Thailand, Pakistan, Canada, Vietnam, Argentine, Saudi
Arabia, Russian Federation, Australia, Italy, Switzerland, United Kingdom, Turkey, Belgium,
Ukraine,
Qatar, Morocco, Spain, France, Netherlands, New Zealand, Tunisia, South Africa, Denmark,
Sri Lanka, Sweden, Paraguay, Oman, Finland, Cameroon, Jordan, Liberia, Uganda, Myanmar,
Philippines, Lebanon, Romania, Poland Greece, Sudan, Portugal, Ireland, Kenya, Mexico,
Nigeria, Ghana, Norway, Malta, Hungary, Malawi, Peru, Samoa, Yemen, Chile, Ecuador,
Colombia Etc.

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4.3 Foreign Remittance Department

Foreign remittance represents of foreign currency receiving and also converting. There are
two kinds of foreign remittance, Inward foreign remittance and outward foreign remittance.

AB has been using state-of-the-art API enabled remittance software for excellence in remittance
operation of the Bank. AB strengthened its remittance relationship with various renowned
exchange houses in 2021. AB is focusing on excellence in customer service through the existing
Branch network and agents. A dedicated “Remittance Hub” backed by advanced technology
platform helps expanding the Bank’s service to the doorstep of the customers. Corporate clients of
AB remained another major source of foreign currency. Bank is also trying to broaden its base
through solicitation of indigenous export clients. Total remittance at the end of the year 2021 was
USD 379 million compared to USD 215 million in 2020.

Foreign Foreign Foreign

Inward Outward Remittance

Fig: Foreign Remittance Department

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A. Inward Foreign Remittance

In which remittance is get inside of country from the outside through TT, FDD, MC, and TC
with the various purpose such as wage-earning remittance. It is when people send money for
family purpose. In export proceed means after getting the commodities after that payment.
Purpose of Inward Remittance:

• Family Maintenance.
• Donation/gift.
• Indenting commission/Agency Commission/recurring agent’s commission.
• Realization of export proceeds.
• Export brokers commission etc.

M.T. (Mail Transfer): M.T. is an instrument issued by a remitting Bank to the paying Bank
advising in writing to make payment of certain amount to specific beneficiary. This involves
loss of interest to the purchaser and for this reason banks can afford to make M.T. rate cheaper
than T.T. rate.
T.T. (Telegraphic Transfer): T.T. is an order for payment of money sent by telex or Cable.
Funds are paid to the beneficiary in the foreign center usually on the same day. No loss of
interest or expense on stamp duty etc.
F.D.D. (Foreign Demand Draft): A foreign demand draft is a flexible instrument issued by
a Bank drawn on other Bank with the instruction to pay of certain amount to the beneficiary
of demand.
T.C. (Travelers Cheque): People basically use TC to meet their expenses for overseas
travels. It reduces the risk of carrying currency notes. These are drawn in freely convertible
currency.

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B. Outward Foreign Remittance

In which remittance is going out from our country that is called outward remittance.
Purpose of Outward remittance:

• Education Purpose.
• Exam fees etc.
• Import Purpose.

4.3.1 Remittance Service Option:

• AB Exchange (UK)Limited
• Xpress Money
• MoneyGram Payment System Inc.
• UAE Exchange Center L.L.C.
• Continental Exchange Solution Inc. (RIA)
• AB International Finance Ltd.
• BRAC Saajan
• Habib Exchange Co.L.L.C

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CHAPTER 05. Performance Analysis

5.1 Export Trend Analysis

Year Billions of US $ Growth

2000 $6.59
2001 $7.23 8.85%
2002 $6.79 -6.48%
2003 $6.88 1.31%
2004 $7.26 5.23%
2005 $9.99 27.33%
2006 $11.74 14.91%
2007 $13.53 13.23%
2008 $16.18 16.38%
2009 $17.36 6.80%
2010 $18.47 6.01%
2011 $25.63 27.94%
2012 $26.89 4.69%
2013 $29.30 8.23%
2014 $32.83 10.75%
2015 $33.82 2.93%
2016 $36.92 8.40%
2017 $37.66 1.96%
2018 $40.73 7.54%
2019 $45.99 11.44%
2020 $39.05 -17.77%
2021 $44.39 12.03%

In this data table of export value of 2000 to 2021 we can see a positive growth. That is considerable
for a country economic growth. Export increases the inward remittance and the foreign currency

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Export Value(In billion of US $)

$70.00

$60.00

$50.00

$40.00

$30.00

$20.00

$10.00

$0.00
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
($10.00)

($20.00)

($30.00)

Billions of US $ Growth

A graphical view of export values from 2000 to 2021.

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5.2. Import Trend Analysis:

Year Billions of US $ Growth

2000 $9.06
2001 $10.10 10.30%
2002 $9.06 -11.48%
2003 $9.76 7.17%
2004 $10.23 4.59%
2005 $13.89 26.35%
2006 $15.63 11.13%
2007 $18.27 14.45%
2008 $22.87 20.11%
2009 $23.73 3.62%
2010 $25.11 5.50%
2011 $35.37 29.01%
2012 $37.27 5.10%
2013 $40.14 7.15%
2014 $44.13 9.04%
2015 $48.28 8.60%
2016 $46.19 -4.52%
2017 $50.47 8.48%
2018 $63.76 20.84%
2019 $64.92 1.79%
2020 $59.18 -9.70%
2021 $71.02 16.67%

From the above data table, we can see the import value of 2000 to 2021 are mostly showing
positive growth. That indicates our country mostly depends on imported products. It is not
sounds good. Because, every year we expend million billion dollars just to fulfill our needs. And
going out currency for importing products more shows the lack of resources or ability to make
products. Though it is not true. Our country is full of agricultural resources and also have some
natural resources too. But we have the lack of efficiency to make the resource fruitful.

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Import Value (In Billion of US $)

$80.00

$70.00

$60.00

$50.00

$40.00

$30.00

$20.00

$10.00

$0.00
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
($10.00)

Billions of US $ % of GDP

A graphical view of Import values from 2000 to 2021.

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5.3. Trend Analysis of Remittances:

Remittance by fiscal year [8]
Remittances (In Millions of
Year Growth %
US $)
2000–2001 1,882.10
2001–2002 2,501.13 24.75%
2002–2003 3,061.97 18.31%
2003–2004 3,371.97 9.19%
2004–2005 3,848.29 12.37%
2005–2006 4,802.41 19.86%
2006–2007 5,998.47 19.93%
2007–2008 7,914.78 24.21%
2008–2009 9,689.26 18.31%
2009–2010 10,987.40 11.81%
2010–2011 11,650.32 5.69%
2011–2012 12,843.43 9.28%
2012–2013 14,461.14 11.18%
2013-2014 14,228.26 -1.63%
2014-2015 15,316.91 7.10%
2015–2016 14,931.18 -2.58%
2016–2017 12,769.45 -16.92%
2017–2018 14,981.69 14.76%
2018–2019 16,419.63 8.75%
2019–2020 18,205.01 9.80%

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Remittance(In Million of US $)
30

25

20

15

10

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19
-5

-10

-15

-20

A graphical view of Remittance values from 2000 to 2020.

From the above data table of remittance of 2000-2001 to 2019-2020 till February, we can see
the country remittance growth is constructive and growing. Hope till end it will come as
positive.

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CHAPTER 06. Recommendation and Conclusion

6.1. Recommendation:

In considering the customer satisfaction on the service the following recommendations are made,

which will benefit both AB Bank Ltd. and its customers.

 AB Bank Ltd. should ensure that the customers are not only getting accurate information

but also the promised service in the first and promised time so that customer can highly

rely on our service.

 Necessary steps should be taken for improvement. Giving the prompt solution or informing

the customer about the action taken time and also proper maintenance of this informed

action taken time could improve the customer satisfaction from very too high level.

 Again, in case of assurance, right solution should be given so that the customer feels more

confident after getting our service.

 Though customers are very satisfied with the empathy. Proper warmly greetings, more

polite and helpful behavior could bring the highly satisfied customer.

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6.2. Conclusion:
The banking industry is essential to the overall development and growth of our nation.
However, our nation's banks are still in the early stages of development. Every bank is
creating their own niche markets and unique customer offerings. This is a significant step
toward breaking into the global banking market.
The entire document I created during my internship at AB Bank Limited's North South Road
Branch. I have gained knowledge of how to function in a real-world workplace here.
Furthermore, I am aware that the bank is a significant source of income for the nation and the
government.
Analyzing AB Bank Limited's performance, I can see that the bank places a lot of emphasis
on foreign trade, and over time, becoming more and more specialized in the area of remittance
as well as import and export activities. The best way to bring in foreign currency is through
foreign trade, so effective measures must be taken to support these industries so they can
continue to operate normally and thus support the country. Different facilities are offered by
AB Bank. It has SWIFT infrastructure. In our nation, very few banks provide this. Online
banking is a service provided by AB Bank for the convenience of its clients. Banks are more
likely to be profitable the better they manage their foreign exchange business

References

1. AB Bank Limited, (2021). AB BANK. [online] Available at https://abbl.com/wp-

content/uploads/2022/06/Annual-Report-2021-High-Resolution.pdf

2. AB Bank Limited, https://abbl.com/

3. Export Trend Analysis, Bangladesh Exports 1960-2023,

https://www.macrotrends.net/countries/BGD/bangladesh/exports

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4. Import Trend Analysis, Bangladesh Imports 1960-2023,

https://www.macrotrends.net/countries/BGD/bangladesh/imports

5. Remittances of Bangladesh, https://en.wikipedia.org/wiki/Remittances_to_Bangladesh

6. Bangladesh Bank, https://www.bb.org.bd/en/index.php

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