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A Working Report on General Banking and IT Division of

Southeast Bank Limited

Autumn

2010

1

Acknowledgement

At first, I should thank Almighty Allah for enabling me to complete my project in time. I

got appointed to work as an intern at Bashundhara branch, Southeast Bank Limited. I

worked on analyzing their banking software and gathering experience of working in an

office environment. I have tried my best to present both hands on experience and study in

this paper. I would like to express my gratefulness and thanks to my respected academic

supervisor Mr. Parvez Ahmed Sharif, Faculty member of Independent University,

Bangladesh (IUB) for giving me the useful instructions on how to work on real life

activity. His dynamic guidance at all stages of work encouraged me to accomplish my

work successfully. I would like to thank School of Business, IUB for giving me overall

support and co-operation. I am also thankful to Head of HR Division of SEBL, Head of

Branch (Bashundhara branch), SEVP (IT division) for allowing me to work in both

places: Bashundhara branch and IT division as well. I am also grateful to the employees

of IT division for their cooperation. They have been very helpful in showing me the work

process and provided relevant information for my report whenever I approached.

Although being in extreme business of workloads in office they tried to provide me with

necessary information when I asked questions. It was a great opportunity to do internship

in such an organization like Southeast Bank Limited. I always felt that I was under

guidance of highly qualified and experienced personnel. The experiences I have gathered

will be very beneficial in my career.

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Executive Summary

Banking sector of our country is playing an important role in our economic situation.

There are a large number of banks operating in our country successfully. Most of the

banks are automated. As a result every bank has banking software to operate their task

easily and efficiently. It also helps them to give effective and quick service to the

customers. Thats why I took this opportunity to know about the business process of

Southeast Bank. My target was to find out what the users want from this service, and

what the output actually they get from their application packages. I had the opportunity

to work upon general banking in Bashundhara branch and also to look into the

procedures of Information technology management at Head office of SEBL. Therefore,

I will be describing my duties, activities and knowledge gained from the experiences.

The deliberation of this report is impounded in exploring information system of the

bank .Thus, my report will be a combination of different aspects of the banking deals

and operations under general banking activities and a comprehensive view on IT

division. An effort has been made to identify some problems and prospects and to

provide recommendation for solving those problems as well.

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1.1 Origin of the Report:

As a mandatory requirement of the Bachelors of Business Administration (BBA) program

under Independent University, Bangladesh this report entitled - "A working report on

general banking and IT division of Southeast bank Limited" - is a contrived depiction of

the three months long internship program at General Banking Services (Bashundhara

Branch) and Head Office (IT) of Southeast Bank Limited

My organizational supervisor is kazi Md. Ehsanuzzaman, Assistant Vice President, MIS ,

IT division, Head office during my stay at IT division and while I worked in branch Mr.

Sanjeed Salahuddin , Probationary Officer was assigned to supervise me. Both of them

cooperated with me and without their help completion of the report wont have been

possible. My working report is on the software overview of IT Department along with

brief idea on general banking activities that I performed. Financial institutions are

investment intermediaries linking the service providers and clients of fund. In todays

world banks are plating a significant role in financial sector. The key to successful

banking relies on ability of balance many activities simultaneously. In order to ensure

efficient and effective banking operation, there is no alternative to the implementation ofinformation system technology. This report will focus on information technology

management of Southeast Bank limited comprehensively.

1.2 Objectives:1.2.1 Primary Objective:

To present an overview of Southeast Bank Limited. To analyze the different types of banking activities in the branch level. To present the networking system and IT management of bank. To provide some recommendations to improve service quality in the bashundhara

branch based on my understanding about the service and work procedures.

1.2.2 Secondary Objective:

To have a practical relation & reliability of the topics we have achieved fromtextual background in our educational life.

To develop understanding of management Information System application inbanking sector.

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1.3 Limitations:

The banks always maintain very high security in their IT section. They do not provide any

user account without their employee. As I was the Intern in their bank, they would not

provide me any user account to access their application program. They only gave me

some limited access in their IT activities, which was not helpful to analyze the application

program. Though a very comprehensive and a well organized report has been tried to be

produced but there are still some limitations present here.

The communication gap among the different personnel because of excessiveworkload.

Inexperience about practical work. Because ofsensitiveness, the department does not want to disclose information

about the technical information, which led to the shortcomings of this report into

some extent.

The bank authorities are so busy that they could not give me sufficient time fordiscussion about the software and its problems.

1.4 Source of Information:

To prepare this report I was highly depended on Primary Data, which was collected from

face to face conversation with the Manager and Employee of the bank in-depth interview.

Since it is a working report, my personal experiences count as well. I also collected some

official scheme, brochure, web site paper that helped me lot to present this report. After

ensuring the accuracy of the data I utilized this data to my report.

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2.1 Historical Background of Southeast Bank Limited:

A Bank with Vision is the slogan of Southeast Bank Limited through a contemplation

of assuring A professional term of Bankers is running the day-to-day operation of the

Bank.

Southeast Bank Limited is a scheduled Commercial Bank established under the Bank

Companies Act, 1991, which obtained license from Bangladesh Bank on March 12, 1995

and incorporated as a public limited company. It started its first commercial banking

operation from May 25, 1995. There are fifteen sponsors involved in creating SEBL and

these sponsors are the leading business personalities and eminent industrialists of

Bangladesh, having stakes in various segments of national economy. They are highly

regarded for their entrepreneurial competence. Besides, the board of directors of this bank

consists of eminent personalities from the realm of commerce and industries of the

country.

2.4 Corporate Profile of SEBLAt a glance:

Name of the Company Southeast Bank Limited

Chairman Alamgir kabir, FCA

Vice Chairman Ragib Ali

Managing Director Mahbub Alam

Company Secretary Mohammad Shahjahan

Legal Status Public Limited Company

Date of Incorporation March 12, 1995

Registered Office EunoosTrade Centre, 52-53, Dilkusha C/A (Level 2, 33 &

16), Dhaka1000

Line of Business Banking

Authorized Capital Tk. 10,000.00 millionPaid up capital 3,422.64 million

Year of initial Public offer 1999

Stock Exchange Listing April 10, 2000 ( DSE), April 24, 2000 (CSE)

Phone 957115, 7160866, 717793, 955466

Fax 99550086, 9550093 & 9563102

SWIFT SEBDBDDHXXX

E-mail [email protected]

Website www.sebankbd.com

Number of branches 69

Number of ATMs 6 in major places all over the country.

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2.5 Management Hierarchy of Southeast Bank Limited (SEBL):

Figure 1 : management Hierarchy of SEBL

During my internship period, I

have found this hierarchy is also

followed in the branch I was

assigned and from the interview

with the employees I have come

to know that this is maintained

in all the branches.

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2.6 Products and Services of SEBL :

Bank is a service organization mainly. It sales the financial services to the consumers in

terms of product. Southeast bank Limited also provides a wide range of products and

services to the people. They provide online banking and ATM services. A picture is

outlined here for a brief look. Before getting into the table, I would like to mention that

the details about these services can be found in the following links:

For conventional banking :http://www.sebankbd.com/conventional_banking.php For Islamic banking: http://www.sebankbd.com/islamic_banking.php For Loans and advances: http://www.sebankbd.com/loans.php For Foreign exchange & remittances-http://www.sebankbd.com/foreign_trade.php

Products and Services

A. Conventionalbanking

B. IslamicBanking

C.Loans andAdvances

D. Foreign trade

and remittances

Savings account Mudarabah Savings

Account

Working Capital

Finance

Export

Current Account Al Wadiah current

deposit

Overdraft Import

Fixed Deposit Receipt Mudarabah short term

deposit

project Finance Remittance

Business

Double Benefit Scheme Mudarabah term

deposit

Syndicated loan Western Union

Money transfer

Special Notice Deposit Mudarabah double

benefit scheme

Packet credit

Millionaire Deposit Mudarabah Millionaire

Deposit

Loan against export

bill

Mudarabah Hajj

Sanchay Prokalpo

Loan against trust

receipt
http://www.sebankbd.com/conventional_banking.phphttp://www.sebankbd.com/conventional_banking.phphttp://www.sebankbd.com/conventional_banking.phphttp://www.sebankbd.com/islamic_banking.phphttp://www.sebankbd.com/islamic_banking.phphttp://www.sebankbd.com/loans.phphttp://www.sebankbd.com/loans.phphttp://www.sebankbd.com/foreign_trade.phphttp://www.sebankbd.com/foreign_trade.phphttp://www.sebankbd.com/foreign_trade.phphttp://www.sebankbd.com/foreign_trade.phphttp://www.sebankbd.com/loans.phphttp://www.sebankbd.com/islamic_banking.phphttp://www.sebankbd.com/conventional_banking.php

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2.7 Establishment of Bashundhara Branch:

The Branch has started its operation from September 19, 2009. Due to the proficient

management of the bank and overall support of the employees of the branch, it hasimproved their outcome in terms of quality services, profitability of business operation

and gaining good-will within very short period.. To reflect upon our first year, I would

like to bring your attention to a few details given below:

Table 1 : Details of Deposit Mix:

Type of

Deposit

Result up to

17.09.2009

% of total

Deposit

Result up to

21.09.2010

% of total

deposit

Variance

Demand

Deposits

34,147,498.71 6.76% 96,295,058.41 4.59% (2.17%)

Savings

Deposits

6,786,500 1.34% 29,421,979.69 1.402% 0.062%

Time

Deposits

463,886,534.43 91.89% 1,971,801,102.92 94.006% 2.116%

Total

504,820,533.14

100% 2,097,518,141.02 100%

As a new branch Southeast bank, bashundhara branch has attracted attention of many customers,corporate, academic institutions which are situated near the branch.To name a few, here the

significant and valued clients are given below:

Bashundhara Group. Spotlight event management. Berger Paints Bd Ltd. North South University Foundation. GrameenPhone Ltd. Marico Bangladesh Ltd. IDLC Finance Ltd. Heidelberg Cement Bangladesh Ltd. Trading Corporation of Bangladesh. Power Grid Company of Bangladesh. Dhaka Stock Exchange. Grameen Bank. Delta Life Insurance Company Ltd. Titas Gas Company Ltd. Grameen Telecom.

In addition to these, they are getting response from other various organizations in the

coming days according to the feedback of their vigorous deposit campaign advised by the

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Head office. They are also rendering their best effort with hard work and commitment to

grow their service and business operation by maximizing the number of various accounts.

2.8 Activities of SEBL ( Bashundhara Branch):

General Banking & Deposit Management:1. Account opening and KYC procedures.

2. Issuance of DD/TT/PO/FDR.

3. Interbank Transaction, OBC/IBC.

4. Account and clearing section.

Credit Department:1. Credit Proposals Processing Procedures.

2. Documentation and Loan Disbursement Procedures.

3. Overview on all returns.

Western Union Money Transfer.

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Chapter 3 : My Duties and responsibilities as an intern

3.0 Prelude:

During my internship period, Initially I was deputed to Bashundhara Branch and later I

was deputed to the IT division ( Head office) upon my request to the head of branch and

Head of IT. So, I had the opportunity to know two types of working environment:

General banking activities (The branch I was assigned). IT management (Giving Support to the branches by working with the Ultimus

team).

In this chapter, I shall describe my activities at branch upon general banking and

overview on IT division is comprehensively explained in the later chapter.

3.1 General Banking :

Financial institution/ intermediary that mediates or stands between ultimate borrowers

and ultimate lenders is knows as banking financial institution. Banks perform this

function in two ways- taking deposits from various areas in different forms and lending

that accumulated amount of money to the potential investors in other different forms.

General Banking is the starting point of all the banking operating. General Banking

department aids in taking deposits and simultaneously provides some ancillaries services.

It provides those customers who come frequently and those customers who come one

time in banking for enjoying ancillary services. In some general banking activities, there

is no relation between banker and customers who will take only one service form bank.

On the other hand, there are some customers with who bank are doing its business

frequently. It is the department, which provides day-to-day services to the customers.

Every day it receives deposits from the customers and meets their demand for cash by

honoring cheques. It opens new accounts, demit funds, issue bank drafts and pay orders

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etc. since bank in confined to provide the service everyday general banking is also known

as retail banking.

3.2 The specific Activities I Performed : As an intern in the SEBL ( Bashundhara branch)

there were a number of activities and projects in which I was involved. The activities are

given below:

Receiving cheque and pay order. Updating the record book of clearing, FDR. Administrative Activities like drafting letters or any other papers. Assisting the person who works on auditing. Inputting data to and retrieving information necessary from Ultimus Software.

Beyond these Activities there were other tasks that I was given to accomplish related to

general banking activities. Actually, bashundhara branch is a very small and new branch , so

there was no specific department where I was assigned rather I was involved with almost all

the members to assist in their works. From this, I have learned many things. Though this is a

small branch, working pressure was high in terms of number of employees. So, I had to do

the same thing redundantly for long hours. Here I am going to explain few activities with

some screenshot so that the procedures can be understood easily. All the activities are based

on this software Bank ultimus.

3.2.1 : PO ( Pay order) :

Pay Order /Demand Draft Block input: Enter 1331 in the Fastpath or Click on Core->Bills and

Remittance->Block Book->Block Book Entry. The screen will be shown as below:

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Screen01: Block Input

Procedures:

1) Choose the Product Id PO for PO Block Entry or DD for DD Block Entry.2) Write the Block Prefix in the Block Prefix field. (PO for Pay order or DD for Demand

Draft).

3) Enter the start No and End no Serial of the book.4) Select the Purpose from the Select List. (Bank Use, Client use or Both Use)5) Enter Remark if required.6) Click on Ok.

A successful message will be shown on the screen.

Screen02: Message Shown after Successful Block Entry

Issuing Of Pay Order:1. Enter 1333 in the Fast path or click on Core->Bills and Remittance->Issue->Issue

Original.

This screen has number of information to be inputted. But all are not mandatory only the blue

marked fields must be inputted to issue a PO. Page can be navigate to lower end by using the

scroll Bar. By default, the Prod.Grp and Product will set for PO issue.

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Screen 03: Pay Order Issue

1) Enter the PO number in the Leaf No field.

Enter details of the Applicants information ifrequired.

2) Select Customer option if the Applicant is a customer to Bank.3) Enter the customer id in the Customer ID field if the Applicant is Banks customer.

Address will automatically shown after the inputting the Customer ID.

4) Enter Beneficiary Name and Address.5) Enter Other Beneficiary details if required but these are optional.

Scroll Bar

Mark Un

check the

Transaction

if notrequired.

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6) Now Enter the Amount of the Pay order in the Amount (Ccy) and click on Showtransaction button.

Now, The Transaction Template will show the following transaction with checkbox besidesit:

Sl Account Transaction

Mode

Dr/CR Amount Check/Uncheck

1 Client Account (Need to be

Inputted)

Transfer Dr -- Yes

2 Pay Order GL head Transfer CR -- No

3 Other Fees and Commission Transfer CR -- Yes

4 VAT on Other Banking

Services

Transfer CR -- Yes

5 HO GL A/C Transfer DR --- Yes

The above Transaction template is generalized for all cases of PO order Issue. If not required, one

can deselect the transaction by clicking on the checkbox.

Each Transaction can be edited by double clicking the selected row. This will prompt a newwindow as shows below:

Screen04: Transaction Edit from the Template

1.

Enter the Client Account number/GL Account Number (Only Sundry A/C allowed) .

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2. If the PO is going to be issued in Cash then change the Trans type to Cash and clickSplit/Modify. And click on OK.

3. Please uncheck the Other Transactions if not required from the TransactionTemplate.

4. Check the Transaction scroll shown in the Issue window.

Click on the OK Button. A Successful message with the Control number will show as shown

below:

3.2.2 Authorization of Pay Order:

Enter 1340 in the Fast path. The following screen will be shown:

Screen 05: BILL Authorization

1) Select the Product Group to Bills.2) Select the Product to Payment Order.3) Select the Function to Issue (Original)4) Click on Search.A row of information will be shown. Tick the Checkbox besides the PO information. Click on

Authorize to Authorize the Transaction. Otherwise decline. Clicking on the Authorizationbutton, the Transaction showed during the Po issue will be authorized.

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Chapter 4

Activities at IT Division

4.1Software Overview (Detail Information of the Solution) :4.1.1 Name of the solution proposed for the award: BankUltimus Core Banking

System. The software is developed by Leads Corporation Limited, Bangladesh.

LEADS Corporation Limited is a leading technology services company delivering

Information Technology solutions. LEADS delivers a broad range of IT services and

solutions to clients in the banking, insurance, financial services, production, distribution

industries and to government and non-government organizations. The detail about the

organization can be retrieved from this URL:http://www.leads-bd.com. The bank has got

BEST IT Use Award- 2010 for its overall Information technology management and

policy.

4.1.2 Purpose and objective of procurement of the solution ( Bank Ultimus):

To accommodate business growth.

To improved quality of customer service. To connect modern delivery channels. To have better control over deliveries and service deployment. To have better Management Information System (MIS). To introduce IT backed new products for clients. To be ready for BASEL II compliance. To improve security administration system. To be at par with competitors.

4.2Process of Needs identification:

To manage existing business operations from a center point i.e. DataCenter (DC).

To have a unified Chart of Account. To have customer centric business practice instead of existing account

centric. To have consolidated MIS report instantly as and when required.
http://www.leads-bd.com/http://www.leads-bd.com/http://www.leads-bd.com/http://www.leads-bd.com/

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To achieve ability to generate most of the statements and returns ofBangladesh Bank within the specified timeframe by maintaining required

accuracy level.

To eliminate Double Entry System. To introduce Checker Maker concept to comply with the ICT

Guidelines of Bangladesh Bank.

To achieve ability to enforce Business and Security Administrationsystem from Head Office to control branch level.

To be able to continue round the clock Business time i.e. 24/7.

To execute End of Day (EOD) from centrally. To integrate Delivery channels with the core system to introduce IT

backed products as per customer demand.

To be able to shift potential Human Resources from continuous process toinnovative business perspectives;

Avoid to maintain any primary and backup servers at Branch level; Real time data replication to the Disaster Recovery Site (DRS);

To introduce effective Business Continuity Plan i.e. Business will be ableto resume automatically from the Disaster Recovery Site (DRS) if the

production site i.e. Data Center (DC) fails.

4.3Scenarios prior to the existing solution:Southeast Bank is one of the largest banks in financial arena in Bangladesh. It is

committed to provide financial services with modern technology to its large and

wide spread customers. From the commencement, it has updated with latest

technological changes and supported local the technical expertises to grow.

Southeast Bank Limited has been operating its core banking operation in all

Branches using distributed Banking softwarePcbank2000until 2008 which was a

local banking software. All the branches were operated in distributed mode. Data

was de-centralized. Maintenance and Management of Banking Software was not

easy task. Central Bank Reporting was very time consuming and required human

intervention. It was unable to connect with modern delivery channels. There were

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also lack of Rich MIS reporting system and lack of centralized security

administration system.

4.4 Drives for sourcing of the new solution:

Southeast bank limited neither got the solution developed from scratch by the

solution provider for satisfying the identified needs nor the solution provider

pushed the solution to the bank after observing by the bank that the identified

needs are satisfied. Actually, Southeast Bank Limited was using local solution

from its commencement which was PC bank 2000. And Leads corp. was working

from that day with Bank. In this case, they could not choose a single option ratherit is blend of two. As previously noted, Southeast Bank studied its requirement to

keep pace with the latest technology .So, IT division prepared a Business

requirement Document and contacted with the others vendors through news paper.

At the same time Leads Corporation also studied the Banking requirement

changes and they have developed centralized software as they could visualize that

in near the future banking industry would require the software with latest features.

So, when Bank has started the procurement process, Leads Corp. gave them the

proposal to upgrade the existing distributed system with the new software as a test

phase. If the test phase is passed then Bank may start the migration process of

their old system with the new one. Later on, according to management decision,

Banks IT division formed a System Team and started User Acceptance Test

(UAT) of the BankUltimus developed modules according to the business

requirements.

4.5 Modules of the Software:

Since the modules are the most important feature of any software, Banks IT

division provided necessary guidelines to implement the modules according to its

Business Needs. The IT division have tested each of the modules with necessary

test script and checked system bus and provided necessary business to make

changes. There are too many modules included in this software but I m

mentioning here some of the important modules:

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BANKING FUNCTION

Forms MIS Reports Others

Customer Profile Statement of Outstanding Credit

facilities

Bank Branch

Information

Bills And Remittance Loan maturity wise forecast Central Bank reports

Loan proposal Maintenance Customer wise account listing Employee information

Commitments and Credit

limits

Date to balance listing Cash management

Loan Account Maintenance Transaction Profile details Marketable securities

Cheque book Maintenance Account wise introducer list Non-performing Loans

Transaction Consolidated Statement of

deposits

Guarantor maintenance

Image capture andtransaction

Remaining maturity position-Loan

Clearing

Deposits Maturity list of FDR under Lien Batch file transaction

Authorization Disbursement of loan Customer Advice

Utility/Service bill Monthly profit Statement Trade Finance Reports

IBT reconciliation Summary statement of allbranches

Internet Banking

Standing Instructions Branch wise summary of

classification

Treasury Financial

Module

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Upon the advice of Southeast Bank IT experts, Leads Corporation added three more add-

on modules and provided them like Internet banking, Trade Finance and Treasury

Financial Module.

Before launching live operation, SEBL have planned to run parallel with the existing

system in one of the pilot branch. Initially Southeast bank ltd planned the first

implementation in their new branches and successfully they have implemented new

system to those branches. Later on, they made a roll out plan for the rest of the branches

within the year 2009. And migrated all the 37 conventional branches and inaugurated 15

new branches this year (2010). But still there are five branches where the migration to

Bank Ultimus from PC bank has not been done. Very soon, these branches will be

updated. is pertinent to mention here that they have also taken the ownership of the

system database and maintained a secured system, so that all the financial data can be

only accessible by proper authority.

Price paid for the solution :4.6 Infrastructural Description :

In order to implement the system they have deployed the following infrastructurechanges:

4.6.1Hardware Specifications: For Database, Application and Report Server a

significant numbers of High end servers have been procured.

---Server configurations: Sun Firework X-5140 Server with quad core

RAMS.

Total number of Servers: 23.There are different types of server. During my working period in Head

office (IT), I have found the following number of servers:

ADS ( Active Directory System ) : User is permitted to enter thesystem through Domain. Number of ADS : 2

CAS Hub ( Client Access Server)dvantage : When a mail istransported to and from yahoo, gmail, msn etc and other domins, it

is passed through this hub. number of CAs hub : 1

Mail Server/ Exchange Server : 2

52.5Lac

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Database Server : 4 Ultumus Server: 4. All the datas OTRS ( Open Ticket Reservation System): 2. Sometimes Users of

the branch enters incorrect passwords / log in ID while logging into

their respective computers, pcs get locked. One of the function of

this server is to unlock PC in branches from IT ( Head office).

ATM Server: 2.ATM Server Backup : 1.Implication Server for Ultimus: 2.EDGE server (Microsoft server): 1. this is a Microsoft server. It is

used for checking mail from outside.

Antivirus Server: 2. Antivirus software plays a crucial roleregarding security purposes. In these two servers, Kaspersky and

SOPHOS antivirus software ( registered version) are installed for

attacking viruses, malware, illegal attack etc.

4.6.2 List of Software Environment : Bank Ultimus. iBank ultimus ( for internet banking). Oracle 10g for Database. Windows XP professional operating system. Sun Solaris operating system. Microsoft IIS for Application Crystal Report 11 for reporting tool.FIU ( Financial Intelligence Unit) Reporting System

(Recommended

By the Bangladesh Bank): This software is installed in almost

every bank in Bangladesh.

VNC Viwer 4.0 : VNC is remote control software which allows anuser to view and fully interact with one computer desktop (the

"VNC server") using a simple program (the "VNC viewer") on

another computer desktop anywhere on the Internet. The two

computers don't even have to be the same type. To be more

simple, there is even a Java viewer, so that any desktop can be

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controlled remotely from within a browser without having to install

software. The function of this software is depicted through a

diagram below :

BASEL II : Using this software requirement against loan isdetermined and it is also recommended by Bangladesh Bank.

ATM Software. Microsoft Open Office Org. 10 is used instead of MS OfficeProtocol of network establishment : Open Shortest Path First

(OSPF), is a routing protocol used to determine the correct route

for packets within IP networks. It is a dynamic route from head

office to branch.

4.7 Networking :

Wide Area has been established using state of the art active devices such as switches,

routers, firewall, intrusion detection and protection system from Juniper Networks, USA

and Network Management Software (NMS) from Computer Associate (CA), USA. The

connectivity infrastructure is based on blending of Fiber, Radio and VSAT links to ensure

high availability. Southeast bank Ltd has contracts with the following ISP s :

Connectivity type ISP Organizations

Radio Link ALAP Communication

VSAT Square Informatix ltd.

Fiber optic Dhaka Com.

Telnet Bd

Banglaphone

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Metronet

Radio link Brac net

A sample diagram is given below for any branch banking in Southeast bank Limited:

Establishment of Data Center and Disaster recovery Center: Bank hasestablished of its state of the art Data Center (DC) at bank's own premises

located at Eunoos Center at Dilkhusha Commercial Area and DRS at

Uttara following the standard set out under the tier III of Uptime Institute

(BB).

Total Cost of implementation :- As a percentage of the years investment in IT:

- As a percentage of total cost of sales:

Payback Period (estimated):

1.3%

5 years

10 Crore

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4.8 The Network Diagram is Given below: The diagram below followshub and spoke topology.

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4.9 Functionality of the Solution:

User Permission: User permission role can be defined on the basis offunction and/or product wise controls of transaction limit, authorization,

add, edit, view etc.

Authorization: Every financial transaction has to be authorized byanother official.

Loan Disbursement Limit: Loan facility has been controlled by theCredit Administration Division (CAD) of Head Office.

Central MIS: The System has the facility to consolidate the Branch andHead Office GL. For this reason, Head Office users can be able to knowthe current position of the bank.

Central Monitoring: Head Office users can be able to know the status ofindividual customer as well as the position of a branch.

Customer and Group Liability: Since the system is customer centric, forthis reason funded and non-funded liabilities of a customer as well as a

group are able to report by one stroke.

Online Clearing: Online Clearing facility is available. Foreign Trade Module: The System has the complete life cycle

maintenance facility of both Export and Import Business.

ATM Interface: ATM Interface is available for ATM SwitchingSystem.

Internet Banking: Now clients of SEBL can have basic banking servicesright from their own places.

Mobile Banking: Services especially foreign remittance can be disbursedat the door step of the beneficiary.

Add On Facilities: Cash Management, Collateral Management andInsurance Management are available.

Islamic Module: A Fully Shariah based Islamic module with profitrecalculation and distribution option.

End of Day (EOD) Process: EOD process has been performed centrallyby the IT Division of Head Office.

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4.10 Efforts given by SEBL to the Existing solution:

Development :Southeast bank actually worked together with Leads Corporation(Vendor of the System) in order to develop a successful Local banking software

and provide Local Software company to grow. System is still customizing by

keeping the existing functionalities of the previous system.

Use of innovative technology/solution/ideas :They have provided the business process, requirements, and sometimes shared

ideas to incorporate processes/modules to the new system. Though initially the

system was designed for windows Server 2003, we have installed the database in

Sun Solaris operating system.

Ownership of the implemented solution :BankUltimus Banking system uses Oracle 10g database. Southeast Bank Ltd is the

full owner of the financial data that resides in their centralized system. They can

also create new report scratch and can tag to the system using reporting tool. The

Application server and database server both are maintained by Banks IT division.

So, in that sense they have owned the total solution though they do not have the

system code to make further changes. But they can developed they own MIS

system, which is their most important requirement .

Usability: the system has acceptability to the users of all levels. A BankingSoftware have different stack of users. In Branch, there are:

a. ManagerHigh end Userb. Middle ManagementMid level Usersc. Bank OfficersOperational users.Again, in Head Office, there are three types of users:

1) System Maintenance Users2) Management Users3) Operational Users.

In Branch, after deploying the software, Managers can easily get the branch status by

click a single button. Mid level Officials are very comfortable as they are getting their

required MIS and operational control and as well as system validation. And at the bottom

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level, operational users get the benefits of simple operations and also gets the checker

maker facility and can provide faster services.Similarly in Head office, System Users can

centrally control and monitor the system, which gives them a great operational ease.

Management can get latest data from the system within a second without contacting with

the branch end and can make effective decisions based of MIS reports.

4.11 Security Policy:

Hardware Firewall : ISG 1000 firewall is used for data centre at head office and SSG

320M firewall is used for branch. Then, IPSEC site to site VPN ( Virtual Private

Network) is configured for secured tunnel so that ISP ( Metronet, Banglaphone etc) is not

aware of our intranet or internal system.

4.12 Work experience with Ultimus team( Supporting the branches) :

The personnels of IT division remains 24/7 in order to support the branches . whenever

any problem occurred regarding ultimus software, the IT people give them solution

properly or solve them from the main database if there is not enough authority given to

the branch employees. From IT division, one can enter into the branchs pc if necessary.

When I worked there I also performed some of the duties regarding IBT (Inter Branch

Transaction) reconciliation. Some of the problems and the respective solutions are given

below :

4.12.1 Problems & Solutions on IBTA (Inter Branch Transaction Advice) data

extract loading into Reconciliation Module:

1. Error Message: Opening Balance is not equal to the Closing Balance of the PreviousDay.

Probable Reason: There might be any IBTA transaction posted after taking this IBTA

backup of the previous day of that day which shows error.

Solution: Create new IBTA backup of the previous day again and this would contain the

last closing balance.

HO

Data

Center

Branch

Metronet,

Banglaphone etc..

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[I.e. If the error message shows while loading IBTA data on 09/09/2010 then it is needed to

create new IBTA backup on 08/09/2010. Hence, the data on Reconciliation Module should

be restored at the last state thus the IBTA backup on 08/09/2010 can be load again]

2. Error Message: Total Dr and Cr Balance are not equal.

Probable Reason: Some Transaction might be missing on either Dr side or Cr side.

Solution:

For PcBANK2000: Execute SQL Script IBTA_Missing_Generation PcBANK.sql to that

branch Database (PcBank2000). Then a History Reveal Form generated for giving missing

transaction while creating IBTA backup from restore mode of PcBank2000. If branch

officials can find out the missing transaction in IBTA Extract by comparing Branch IBTA

Report on that day to GL ( general ledger) Statement of A/C 9010802000 on that day, he

would put the missing transaction information and amount into the History Reveal Form.

Then save the form and create IBTA backup on that day. This new IBTA backup will contain

the previous missing transaction.

For BankUltimus: Create IBT extract text files on that date for that branch from path-7191 in

BU. Date wise folders containing 3 text files will be created on BankUltimus server

c:\BUFileGen folder.If not solved, contact Mr. Saif, Leads Corp. Ltd.

3. Error Message: Responding Dr Balance in Extract and Total Responding Dr Balance

are not equal.

Probable Reason: Some Transaction might be missing on Responding Dr Balance in

Extract.

Solution: Solution is the same as Error No. 2.

4. Error Message: Responding Cr Balance in Extract and Total Responding Cr Balance

are not equal.

Probable Reason: Some Transaction might be missing on Responding Cr Balance in

Extract.


5. Error Message: Originating Dr Balance in Extract and Total Responding Dr Balance

are not equal.

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Probable Reason: Some Transaction might be missing on Originating Dr Balance in

Extract.


7. Error Message: Invalid object / Object could not found usp_BULK_INSERT_IBTA.

Probable Reason: Procedure usp_BULK_INSERT_IBTA drops from

[db_temp_pcbankrecons] while loading IBTA extract data of PcBANK2000.

Solution: Execute script IBTA_restore_FINAL_Script.sql on Reconciliation database.

Extract:Extract is a statement of all originating and responding transactions among interbranches

through inter branches debit and credit advice. At the end of the day, all the debit and

credit advices of different department come to accounts department. It makes extract in

light of all advices. Actually extract shows the balance of SEBL respective Branch

general A/C. The objective of preparing it is to know how many transactions have been

originated and responded by the respective branch per day. Branch has to send it its Head

Office copy keeping one photocopy.

4.13 Concluding Discussion: The bank has taken number of major initiatives to

modernize its IT infrastructure notably implementation of Core Banking Solution (CBS),

modernization of Wide Area Network (WAN) infrastructure, establishment of Data

Center (DC) and Disaster Recovery Site (DRS).

Under the modernization initiatives of IT infrastructure, the bank has rolled out a

centralized web based solution for its CBS known as BankUltimus. The BankUltimus is a

web based banking system which is bundled with worlds most modern and reliable

relational database Oracle and secured UNIX operating system called Sun Solaris. The

system has got many modules to cater newer services and introduction of newer products

with minimum lead time. The system allows integration with the multiple channels and

interfaces such as ATM, Internet Banking, Mobile Banking, SWIFT, Call Center etc. thus

expanding customer choice while making banking transactions.

The system has got extensive audit trails making it more compliant with the directives of

Central Bank. This has got interface to extract data for Central Bank reporting, including

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reports for BASEL-II. The extensive MIS of the software helps management in decision

making process.

One of the most magnificent feature of the system is it has got both Traditional and

Islamic module running on the same system. The Islamic module is completely Islamic

Shariah complaint and follows the Islamic Banking Guidelines of Bangladesh Bank.

Information assets are critical to the services provided by the Bank to its customers. Protection

and maintenance of these assets are critical to its sustainability. The Bank has already taken

Initiatives to protect the information from unauthorized access, modification, disclosure and

destruction to protect customers interest. The Bank has already introduced number of logical

protection levels between web layer and its core application and database layer such as, Router

configuration with ACL (Access Control List) and Virtual Private Network (VPN) allowing

traffic only to required IP and service; Rule base Firewall restricts external traffic only to DMZ

(Demilitarized Zone) hosts on required service; Web Server IPS (Intrusion Prevention System)

profile which is capable of filtering out targeted attacks; Application Server is allowed only from

front end server and on legitimate ports only; Consideration of hardware based Data Encryption;

Consideration of OTP (One Time Password) Token Technology.

From the above stated detailed discussion and initiatives taken by SEBL, I believe that they have

very strong IT division and the organization deserves to get the Best IT Use 2010 Award where

I got the opportunity to do my internship.

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Chapter 5

Summary and Conclusion

5.1 Things I have learned:

From general point of view, I gained the following experiences and learned from working at

Southeast Bank limited Bangladesh as an intern:

Working in a corporate environment and interacting with officials in an officialmanner

Gained knowledge about the prestigious banking software Bank Ultimus byworking in the IT division

Ability to interact with customers, ability to work in a team, ability to meetdeadlines and doing work correctly at the same time.

One must always be careful while receiving checks the followinginstruments: Amount of taka, name of the payee, date, and account number.

Since this was the first time I got engaged in the corporate world, I did not know

how they worked altogether. Working in a bank meant meeting deadlines. Everyone in

the bank made sure that the day to day work was done on time and nothing was

kept pending for the next day. This helped me learn to work within a set time limit

and meet the deadline. Now I know how to finish work on time and be correct at the

same time.

5.2 Recommendation: It is pertinent to mention here that I was asked by the honorable

SEVP & Head of branch , Md. Abidur Rahman Chowdhury , to make some

recommendations in order to improve the service quality as well as the image of SEBL ,

Bashundhara branch among the clients. Therefore, I am including this section along with

my report though I am not from marketing background. I have tried my best to find out

some realistic promotional activities and solution to some internal backlogs regarding theservice quality. If there is anything wrong or irrelevant, the reader is requested to take

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those errors under kind consideration. Although it is a new branch it is performing

successfully throughout the year. However it is facing some challenges because of some other

nearby branches of some other well-established banks like Bank Asia, DBBL, Prime Bank, EBL,

UCB etc. These banks branches are taking different initiatives to attract different clients and

corporate organizations in Bashundhara area to make them their valuable clients. They can

become SEBLs clients too if some strategic steps are taken in order to improve the service

quality. The steps are given below:

Customer defined Service standards: A formal service blueprint should bedesigned with appropriate service level standards to reduce the variability of service.

These standards should be customer defined and customer expectation should be

considered while deciding about the service standards.

Defensive Strategy of Service Quality: The branch should pursue a defensiveservice quality strategy that is a slow going strategy rather than offensive service

strategy. That is should focus on Costs of operation, increasing Volume of

businesses with existing loyal customers, Segmentation of the premium

customers, foster a positive word of mouth communication in its existing

customers, etc. Though these strategies will take time to develop a huge customer

base, they will in the long run bring more loyal customers to SEBL, Bashundhara

branch.

Faster Delivery of ATM cards: SEBL should reduce the amount of time requiredto provide new ATM cards. Currently it takes more than 2 weeks (during my stay

there, I ve observed) while some competitors can provide the card within 2

working days. As the SEBL ATM card comes directly from Head office delays

are obvious. SEBL should make necessary arrangements to produce the new cards

faster in order to reduce the customer difficulties faced in the absence of ATMcards.

Maintaining a Well-balanced Portfolio:In order to increase the profitability and reduce the credit risk, SEBL bashundhara

branch should maintain a well-balanced portfolio. For example, instead of

focusing on just corporate banking and high profile business loan and leasing, it

should also give equal importance to retail banking. The more diversified the

portfolio is the lesser the risk of losses.

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New ATM booths Should Be Introduced:New ATM booth should be constructed in the branch premises satisfying more

geographic segments in this particular area. As convenience of communication to

the branch location is a very important factor for the customers SEBL should

consider building new ATM booths in the branch premises. This will also attract

new customers from other banks who are currently offering this service.

A new campus road show may be arranged in NSU/IUB campus for attracting thestudents.

There is really lack of indicators of Southeast bank limited in different places. Inparticular, Bashundhara branch can set up the indicators symbolizing the SEBL

slogan and logo at different locations so that people get to know more about this

new branch.

Digital indicators can be set up inside the branch so that the customers do not getconfused when they need to move from one section to another section. This will

also enhance the branch premise more professional.

Different kind of seasonal promotional activities can be taken for attracting morecustomers. For example: this branch has maximum account with North South

University students, specially they pay their tuition fees here. So, when this tuition

fee taking periods starts, every student can be offered to open their account free of

service charge for the first one year or they can be provided with cost-effective

gifts.

Advertising & Promotion:SEBL should pursue an aggressive advertising campaign in order to build up a

strong image and reputation among potential customers. In this context, the

valuable strengths should be used for positioning the corporate image of the bank.

TV ads should be aired to reach a wider array of customers. The ads should

capitalize on building strong relationship, needs of customers and quality service

of the bank rather than features of products. Thus and offensive marketing

strategy emphasizing customer satisfaction and service quality can bring valuable

business for the Bank.

Employee Trainings: In order to reduce operational mistakes employees in thebranch should be trained up on using Ultimus software.Employee trainings and

workshops can be administered in order to give them knowledge and

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professionalism of customer interactions. With more professional base employees

can better satisfy the customers. They should be taught about how to deal with

problem customers and how to deal problematic situations. Employees-

specifically sales officers should be conscious and taught about the financial

aspects of the loans so that it becomes convenient for the approval officers to

assess loans.

Focus on Relationship Strategies:The bank should focus more on existing customers in order to build strong and

loyal relationship with them as satisfied customers more aptly or certainly

recommends the bank to friends and relatives. Thus the power of relationship will

foster positive Word of Mouth Communication and will attract new customers at a

lower cost.

5.3Conclusion:Doing my internship provided me with the opportunity to gain hands on work

experience that was not possible get in the classroom. I had a great exposure to

work in banking environment which is a very vital in financial sector. My

internship helped me to develop essential skills and build the confidence by

performing tasks in the organization. While working with Southeast bank ltd,

Bangladesh, I have developed good organizational communication skills. This

internship was an on-the-job learning experience which enhanced my chances for

early career success. It provided me with a realistic work preview and offered

practical, supervised learning experience. I have learnt more about a chosen fieldwhere I always wanted to work that is management information system of a

renowned bank who has achieved the best IT use Award- 2010. I have gathered

knowledge about general work functions in particular fields from SEBL.

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