A Report on

CITY BANK (Products & Services)

Chapter 1

Introduction

1.1 Origin of the Report1.2 Purpose of the Report

1.3 Scope of the Report 1.4 Methodology1.5 Sources of Data

1.6 Limitations

1

1.0 Introduction

1.1 Origin of the Report

This report is prepared for the course “Theory and Practices of Banking” assigned by our course instructor S M Zahidur Rahman. This report on “City Bank (Products & services)” was assigned us on July 01, 2008. The report is supposed to be submitted on July 23, 2008.

1.2 Purpose of the Report

The purposes of this report about City Bank are:

To familiarize with practical banking activities of City Bank.

Know INS & outs about City Bank’s accounts, deposit schemes

and different types of loans.

To know how City Bank deals with Retail and Corporate banking.

Make an idea about SME banking.

1.3 Scope of the Report

As the study has been concentrated on functions, services & products of City Bank, it

covers the core activities of the bank. This study gives information about the accounts,

deposit schemes and loans. This report covers the aspects of corporate and retail banking.

We also try make a overview of SME and treasury sector, but we cover retail and

corporate sector better than these two.

1.4 Methodology

A proper methodology is always necessary for a successful accomplishment for any

research work. It helps to organize and analysis data and information through a

systematic process to achieve the ultimate goal and objectives of the study.

The Framework Of methodology is illustrated on next page:

2

1.5 Sources of Information

We tried our best to collect information form our best possible sources and utilize them

fruitfully. Data have been collected from two sources. Sources of Information are as

follows:

(1) The Primary Sources of Data: Face to face interview with the bank officers and

staff of City Bank in Khatungonj, Chittagong.

(2) The Secondary Sources of Data:

Web-site Of City Bank

Different publications of the City Bank Limited.

3

Desk Work

Setting Research Objectives

Data Analysis

Report Writing

Data Collection (Primary & secondary)

Different Brochure of the City Bank Limited

Different Textbooks.

1.6 Limitations

There have a number of limitations in this report. These are:

Inexperience of not working in this field before. Most of the officers of the bank were too busy with their job. So

they could not afford enough time for us. The organizational secrecy about confidential information was a

hindrance for proper data collection. Not finding enough information about SME banking and online

banking. The report is limited by time and cost.

4

CHAPTER 2

Organizational Overview2.1 History

5

2.2 Shareholders’ Information2.3 Vision & Missions2.4 Board of Directors

2.5 Management Hierarchy2.0 Organizational Overview

City Bank is one of the oldest private Commercial Banks operating in Bangladesh. It is a top bank among the oldest five Commercial Banks in the country which started their operations in 1983. The bank currently has 83 online branches spread across the length & breadth of the country that include a full fledged Islamic Banking branch. Besides these traditional delivery points, the bank is also very active in the alternative delivery area. It currently has 25 ATMs of its own; and ATM sharing arrangement with a partner bank that has 225 ATMs in place; SMS Banking; Interest Banking and so on. Soon its Customer Call Center is going to start operation. The bank has a plan to end the current year with 50 own ATMs. Recently the bank has celebrated it’s silver jubilee and by this event they modify their previous name “The City Bank Limited” into new reorganization “City Bank”. They also introduce their logo with a motto “Making sense of your money”.

2.1 HistoryCity Bank Limited is the first private sector Bank in Bangladesh. The Bank has been operating since 27th March, 1983 with an authorized capital of Tk. 1.75 Billion under the entrepreneurship of thirteen prominent & leading businessman of the country. The noble intention behind starting this Bank was to bring about qualitative changes in the area of Banking and Financial management. Today, City Bank serves it's customers at home & abroad with 83 branches spread over the country & about three hundred oversea correspondences covering all the major cities and business center of the world.

2.2 Shareholders information:

The City Bank Limited was incorporated on 14.3.1983 as a Public Ltd. Company Under

The Companies Act- 1913. It got Certificate of Commencement of Business On

20.3.1983 and formally started banking operation from 27.3.1983.

Authorized Capital : Tk. 1.75 Billion

Total Number Of Share : 17,500,000

Market Lot Of Share : Five

Face Value Per Share : Tk. 100/-

At present, there are about 5,678 Shareholders approximately.

2.3 Vision & Mission of CB

6

Like other companies City Bank have it’s own vision and missions. The vision & missions of City Bank given in the next page

Corporate Vision

To be the leading bank in the country with best practices and highest social commitment.

Corporate Missiona) To contribute to the socio economic development of the country

b) To attain highest level of customer satisfaction through extension of services by dedicated and motivated team of professional team of professionals

c) To maintain continuous growth of market share ensuring quality

d) To maximize bank’s profits by ensuring its steady growth

e) To maintain the high moral and ethical standards

f) To ensure participative management system and empowerment of Human Resources

g) To nurture and enabling environment where innovativeness and performance is rewarded.

2.4 Board of DirectorsCity Bank’s board of directors consists of twelve persons. The names of the members in

board of directors are given below-

Mr. Aziz Al-Kaiser (Chairman)

Mr. Hossain Mehmood (Vice Chairman)

Mrs. Evana Fahmida Samdani (Director)

Mr. Hossain Khaled Saifullah (Director)

Mr. Rajibul Huq Chowdhury (Director)

Mrs. Tabassum Kaiser (Director)

7

Mrs. Meherun Hoque (Director)

Mr. Rafiqul Islam Kh (Director)

Mr. Razib Samdanian (Director)

Mr. Rubel Aziz (Director)

Mr. Mobarak Ali (Director)

Mr. K Mahmood Sattar (Managing Director)

2.5 Management Hierarchy

Management Hierarchy of City Bank Limited is given below-

CHAIRMAN

VICE CHAIRMAN

BOARD OF DIRECTORS

MANAGING DIRECTOR (MD)

DEPUTY MANAGING DIRECTOR (DMD)

SENIOR EXECUTIVE VICE PRESIDENT (SEVP)

EXECUTIVE VICE PRESIDENT (EVP)

SENIOR VICE PRESIDENT (SVP)

VICE PRESIDENT (VP)

FIRST VICE PRESIDENT (FVP)

SENIOR ASSISTANT VICE PRESIDENT (SAVP)

ASSISTANT VICE PRESIDENT (AVP)

SENIOR EXECUTIVE OFFICER (SEV)

EXECUTIVE OFFICER (EO)

8

Executives &

Officers Level

Management Level

SENIOR OFFICER (SO)

OFFICER

JUNIOR OFFICER

In the whole Bangladesh all the employees of City Bank fulfilling their responsibilities in

83 branches with online backup.

2.6 Services & area of operation

City Bank’s products & services encompass wide diversified areas of trade, commerce &

industry which tailored to the specific needs of the customers and are distinguished by an

exceptional level of prompt and personal attention. Over the years the Bank has expanded

the spectrums of Its Services. The extensive and ever growing domestic network provides

and carries various products and services to the doorsteps of millions. City Bank Limited

has already introduced some new Banking products like duel currency Credit Cards,

ATM and Online services which has created attraction among the clients. City Bank is

among the very few local banks which do not follow the traditional, decentralized,

geographically managed, branch based business or profit model. Instead the bank

manages its business and operation vertically from the head office through 4 distinct

business divisions namely. So, we can divide City Bank’s all product, service and

functions according these four distinct business divisions-

Corporate & Investment Banking;

Retail Banking (including Cards);

SME Banking; &

Treasury & Market Risks.

9

Under a real-time online banking platform, these 4 business divisions are supported at the

back by a robust service delivery or operations setup and also a smart IT Backbone. Such

centralized business segment based business & operating model ensure specialized

treatment and services to the bank's different customer segments.

10

CHAPTER 3Corporate Banking

3.1 Working Capital Finance3.2 Trade Finance

3.3 Short/Mid term Finance3.4 Long Term Loan & Project Finance

3.5 Lease Financing3.6 Islamic Finance

3.7 Structured Finance3.8 Cash Management

3.9 Investment Banking3.0 Corporate BankingCity Bank is a major player in Bangladesh wholesale banking industry to offer the full scope of innovative, customized solutions and services. They offer service at the highest level. City Bank (CB) focus is not on short-term profit, but on building long-term relationships and standing by our clients whenever they need us.City Bank has a unique business focus on enabling project financing, trade, investment and supply chain financing for clients. Their aim is to be a one-stop gateway for corporate and financial institutions looking to extend their business. CB committed to using our country wide network to facilitate our clients' growing trade and investment flows and supply chain financing needs across our business footprint. City focus exclusively on corporate and institutional clients domiciled or conducting business in our footprint, offering clients access to our extensive branch network and award-winning suite of state of the art services.City Bank fully understands the importance of time, convenience and efficiency to the success of your business. We make easy the complex financial world for you and help corporate sector to maximize every opportunity. City Bank’s corporate banking sector have the following sub-parts or services for their corporate customers:

Working Capital Finance Trade Finance Short/Mid term Finance Long-term Loan & Project Finance Lease Financing Islamic Finance Structured Finance Cash Management Investment Banking

11

A detail discussion about them is given below-

3.1 Working Capital FinanceOverdraft: A convenient and flexible form of short-term financing for routine operating expenses and overheads of your company.Guarantees & Bonds: City Bank issues a full range of Performance Guarantees, Advance Payment Guarantees, Financial Guarantees and Bid bonds for supporting the underlying business of their customers.

3.2 Trade FinanceCity Bank’s trade finance is tailored to meet the individual needs of your business. City Bank can help even a company which has limited unstructured credit lines, due to reasons such as limited financial resources or sudden spike requirements. That’s because their risk evaluation focuses more on companies’ performance track record, existing performance and collateral valuation.For facilitating the international trade City bank arrange the export and import sector with various services.

3.2.1 Import FinanceThe services of City Bank in import sector for international trade is given below-

Letter of Credit: When buying goods from overseas suppliers, any firm will wish to receive the goods as ordered in the right quantity, on time and at the designated place. The firm will also wish to make payments only after receipt of the required documents including the title of goods. City Bank solve the firm’s needs by issuing a documentary credit on behalf. A documentary credit is Bank's guarantee of payment for a shipment of goods against specific documents as stipulated on it. By using a Letter of Credit, City will only make payment after receipt of titles and other documents that should fully comply with the terms of the credit. A firm can enjoy a safer and cheaper alternative to making advance payment or deposits.

Back-To-Back Letter of Credit: If an intermediary’s supplier wants to sell on documentary credit term only, the intermediary may apply for the issuance of a Back-to-Back Letter of Credit from City Bank against the export Letter of Credit. A Back-to-Back Letter of Credit is issued against the export credit (the master credit), but the terms and conditions may not the same as the export credit. The firm must submit it’s own draft and invoice, together with the other shipping documents presented by supplier to secure payment under the export credit. After processing, the customer firm will have the export proceeds to pay your supplier and the balance credited to your account.

Deferred Letter of Credit: A Deferred letter of credit which allows the nomination of a bank, or the issuing bank to effect payment against stipulated documents at a maturity date as specified or determinable from the wording of the credit. With this a firm will be able to receive the goods now and pay later.

12

Import bills for collection: By informing your supplier to send their shipping documents to City Bank, the customer firm will enjoy prompt advice upon our receipt of documents and efficient payment according to your instructions.

Shipping Guarantee: To operate firm’s import business efficiently, it is vital firm’s goods be cleared expeditiously. By issuing a shipping guarantee in the shipper’s favour, City Bank facilitates prompt clearance of goods until bills or lading is received.

Import Financing: City Bank will be able to provide financing solutions to pay for the supplier’s documents under letter of credit or import collections. Open account invoice financing is also available.

Performance bonds and other guarantees: City Bank offers tailored solutions to meet all the firm’s performance bond and guarantee needs.

3.2.2 Export FinanceIf any firm involves in export business, City Bank can help the firm with Export L/C advising, L/C Safekeeping, L/C Confirmation, L/C Checking and Negotiation. For financing solutions, tap on to Pre-shipment Export Finance, Export Bills for Collections, Invoice Financing. Outsource your administrative functions to City Bank�s document preparation service. Here is detail information about export financing:

Export letter of credit advising: Benefit from prompt advising of export letter of credit from a wide international network through City Bank.

Export letter of credit safekeeping: Rather than be inconvenienced by having to come to the bank to collect your export letter of credit, City Bank will safe keep customer firm’s original and send it a working copy to facilitate the preparation of documents.

Export letter of credit confirmation: Exporters may deal not only with unknown foreign buyers, but also with their banks which are less well known institutions and whose letter of credit (L/C) may not be sufficient comfort. By requesting City Bank to confirm firm’s export L/Cs, to obtain guarantee of payment for document presented in compliance with the credit.

Pre-shipment export financing: City Bank provides pre-shipment finance against irrevocable letters of credit from or purchase orders in a number of currencies to allow firms to trade with confidence. If the firm need to fulfill a sales contract but need funds to purchase raw materials or process goods for export, City Bank offers the firms involves in international trade pre-shipment export financing in a variety of currencies.

13

Letter of credit checking and negotiation: City Bank’s thorough checking standards will reduce the chances that the firm’s documents will be rejected. Strict service standards are applied to ensure firm’s documents are negotiated and dispatched quickly.

Export bills for collection: Simplify dispatch tracking of payment and reconciliation of firm’s export collections when firm choose City Bank’s documents against acceptance, documents against payment or clean collections. Discounting of export collections is also available.

Export invoice financing: To tide over any cash flow problems arising from credit terms to the buyers, the exporter may obtain invoice financing pending buyers’ payment.

Document preparation: Benefit from lower costs, faster processing and fewer errors - outsource to City Bank the paperwork and administrative functions related to your export activities based on firms’ letter of credit or purchase order.

3.3 Short/Mid term FinancingProfit is the pivot on which the entire business activity rotates. Banking is essentially a business dealing with money and credit. Banks make loans and advances to traders, businessmen and industrialists against security of some assets or on the basis of personal security of the borrower. According to the needs of different firms City Bank arranges short-term and Mid-term loans-

3.3.1 Short-term LoanAs the responsive player in market, a firm may anytime need fund to utilize for a very short time due to either emergency or short term projects. In such case, City Bank is there to facilitate the firm’s need. This can be a Short Term Loan or a Short Term Revolving Loan. The firm can get it either for it’s inland business or cross-border payment in foreign trade.

Short-tem Financing of City Bank includes:a) Cash Credit (Hypothecation)b) Cash Credit (Pledge)c) Overdraft Facilitiesd) Secured Overdraft Facilities.e) Bank Guarantee.f) Letter of Credit (L/C)g) Loan against Trust Receipt (L.T.R.)h) Loan against Imported Merchandise (L.I.M)i) Packing Cash Credit (P.C.C.)j) Loan General and others

14

3.3.2 Mid Term LoanCity Bank can also equip you the required fund for a longer period. Mid Term Industrial Loan means term of loan is upto 5 years. The City Bank Limited has a vision to improve the financial sector of Bangladesh i.e. economic condition of Bangladesh by providing effective and innovative banking and financial product in financial market. However, in every economy of the world financial sector is highly regulated sector.

Mid Term industrial finance includes:

Project loan and Term loan to industries according their needs under the rules & regulations of Bangladesh Bank.

Equity Participation to any Financial Institutions/Companies under the rules & regulations of Bangladesh Bank.

Equity Entrepreneurship Fund (EEF) to any company under the rules & regulations of Bangladesh Bank.

Finance for BMRE where “B” means for balancing, “M” modernization, “R” for replacement and “E” expansion

To set up a manufacturing facility i.e. acquire land, buildings, plant and equipment, etc, collectively known as fixed assets.

Purchasing of adequate inventories comprising of raw materials, stock in process and finished goods, retaining sufficient cash and extending credit to their customers.

3.4 Long Term Loan & Project Finance

City Bank always keeps a closer look to the firms’ long term need. That’s why they always interested in long term financing. Long term loans are eligible for more than 5 years. This loan includes commercial house building loan, industrial loan etc.

City Bank’s project financing solutions:

Mitigate sponsor exposure to project risk Enhance use of leverage to increase project returns by lowering the weighted

average cost of capital

Provide access to significantly longer tenor debt financings

Create optimum financing structures (source of debt, currency, derivatives) that take into account company’s particular capital needs as well as industry specific issues.

3.5 Lease Financing

15

CBL Lease Financing is given for Equipments/Machinery for Industry or for BMRE of business project

CBL finance leasing of

Capital Machinery Heavy construction equipments Lifts/ Elevators Air Conditioners Vehicles like Luxury bus, Mini-bus, Taxi-cab, Car, Pick-up,

Trucks, etc Medical equipments Generators, Computers, etc Apartment/Building Other costly consumer's durable

The City Bank Limited offers lease financing facilities on the’ above items under pleasing atmosphere.

The Basic Terms for Lease Financing

Selection Autonomy: The lessee bears all the liberty to decide and select the brand, specifications, price, supplier/seller and purchase terms & conditions of the leased items.

Lease term:

i) Capital Machinery, Equipment and Medical Instrument - Maximum 5 (five) years. ii) Vehicles & other Consumer durable - Maximum, 4 (four) years. iii) Apartment/Building Case to Case basis.

Payment Mode: Entire financed amount along with interest and charges would be recovered by equal monthly installments.

Lease Deposit: A minimum deposit equivalent to 3 (three) months lease rentals is required, which shall be refunded/adjusted on expiry of the lease term.

Rate of Interest: 14% -16%

Security:

a) Leased item itselfb) Bank/Insurance guaranteec) Encashable securities like FDR, BSP, Share Certificates of listed

companies, ICB unit Certificate etc.d) Immovable properties along with cash security if the value of tangible

security falls short of the value of leased assets ande) Personal guarantee of a gentleman acceptable to the Bank.

16

Insurance: Clients have to take insurance coverage on bank stipulated insured value for the entire lease term at his own cost (Year to year basis).

Maintenance: Clients have to maintain the leased items in usable condition throughout the whole lease period at his cost and shall be solely responsible for any damage or loss although insurance will cover most of the abnormal risks.

Full Funding: Under the method CBL provides 100% funding while only 50%-60% of financing is made under traditional system.

3.6 Islamic Finance

With over 1.5 billion Muslims in the world, the global Islamic funds market is currently valued at USD 750 billion and is expected to grow exponentially every year. The city Bank Limited started its Islamic Banking operation by opening its first Islamic Banking Branch at 9/H, Motijheel C/A, Dhaka. All the activities conduct as per Islamic Shariah.

At City Bank our dedicated Islamic Banking team combines Shariah expertise with strong business acumen to offer customers the best of both worlds - comprehensive international banking services and a wide range of Shariah compliant financial products based on Islamic values. At City Bank, they blended Shariah principles with our rich banking heritage of more than 150 years to provide banking services that support your business while respecting your beliefs. Their diverse range of Islamic Banking products are designed to give us greater flexibility while conducting business through Shariah-compliant process.

Products

Bai Muajjal: For financing procurement of raw material where goods are kept under customer’s custody.Bai Murabaha: For financing procurement of raw material where goods are kept under bank’s custody.Hire Purchase under Shirkatul Melk: For financing procurement of capital machinery,Bai Salam: For financing pre-shipment expenses by purchasing exportable goods in advance.

3.7 Structured FinanceA leading provider of cost-efficient, lease-based and asset-based financing solutions to businesses in Bangladesh, City Bank can create and tailor the right structured solutions for corporate firms’ business needs in order to enhance shareholders’ wealth and your market competitiveness. These solutions include:

Structured financing solutions: Principal to principal structured capital market transactions optimizes investment returns and reduces effective funding costs.

17

Syndications: This normally involves getting a group of banks together (forming a syndicate) to provide the loan amount required by the customer under a set of common terms and conditions laid down in a loan agreement.By Choosing City Bank firms can gain access to full loan origination, distribution and trading capabilities, together with an unrivalled ability to match lenders and borrowers. City’s leadership position and world class distribution capability result from the team�s ability to read the market, and to provide superb sell down coverage.

How It Possible: City Bank’s intimate knowledge of the diverse industries as well as understanding and working with regulatory bodies, means they can provide a solution designed solely to meet the corporate firms’ needs.City also partner their clients to arrange syndicated loan facilities for project finance, aircraft finance, structured trade and acquisition financing including leveraged buy-outs. They have been successful in loan capital raisings for financial institutions, real estate development, hotels, telecoms, institutional banking and finance, public utility, oil and petroleum, light manufacturing and food sectors.

Partner of Success: City Bank already proven track record in devising innovative capital-raising structures that exceed their clients' expectations. Their tailored solution for your business could include:

Working capital and corporate funding. Commodity and trade finance Islamic structures Project finance Structured, complex and tax-efficient capital raisings.

3.8 Cash ManagementIn today's competitive financial environment, effective cash management has become a critical success factor. This is the right time to have integrated cash management solution. City’s cash management services include local and cross border payments, collections, information management, account services, liquidity management and investment services for both corporate and institutional clients. City Bank’s cash management includes the following services-

3.8.1 Payment ServicesCity Bank(CB) can help a firm to save their time and money by reducing processing costs while providing a value-added service to it’s suppliers. City Bank’s payment solutions can help to reduce overall processing costs for domestic and global payments saving firm’s time and money while providing a value-added service to its suppliers. CB’s comprehensive payment services will be tailored to enhance firms’ accounts payable process. This will eliminate many manual tasks involved in making payments, allowing firms and their staff to spend more time focusing on their core business needs.City Bank understands that most of clients’ effort in the payment cycle is directed towards initiation; difficulties in the subsequent reconciliation process can jeopardize the

18

whole process. With City Bank Channels firms can now track the exact status of each payment through timely reports that can be uploaded seamlessly into their firms’ system.

3.8.2 Collection ServicesCity Bank has a comprehensive branch network and the local knowledge to help the corporate firms with lower costs and greater efficiency. The City Bank Collections Solution leverages the Bank's extensive regional knowledge and widespread branch network across their key markets to specially tailor solutions for their clients regional and local collection needs.This Collections Solution, delivered through a standardized international platform, has the flexibility to cater firms’ local needs, thus enabling firms’ to meet their objectives of reducing costs and increasing efficiency and profitability through better receivables and risk management.

3.8.3 Liquidity ManagementCity Bank always keeps a closer look on liquid cash of their client corporate bodies; so, the firms can manage their loans and take their investment decision. City Bank helps firms to get the most out of their company’s cash resources with physical sweeping, notional pooling, interest reallocation and investment.

3.9 Investment BankingCity Bank is the market leader across the footprint in innovative, landmark deals, multi-jurisdiction solutions and sophisticated product structuring for corporate and institutional clients. City holds the leading positions in fixed income local currencies and loan syndications. Their in-depth understanding of the local regulatory framework in the domestic debt and loan markets, product expertise and wide geographic reach, help firms achieve for financing and investment objectives.City Bank helps in firm’s investment not only by approving capital, but also by advising in different terms. CB helps the firms’ investment decision by following facilities:

3.9.1 Asset Backed SecuritiesCity Bank structure, arrange and distribute asset-backed and future flow transactions for clients and City’s track record of innovative deals puts them at the forefront of developing securitization markets in our footprint.

3.9.2 Debt Capital MarketsCity Bank’s proven knowledge, product capabilities and global reach make well-suited to matching investors’ needs with the funding requirements of international and domestic issuers. City Bank helps the firm to find the better field of investment and how to invest.

3.9.3 Credit DerivativesCity Bank offer investment tools and a range of local currencies to provide structured asset solutions to meet specific investment needs achieve target yields on firms’ portfolio and manage risk exposure.

19

3.9.4 Convertible Bonds / Equity DerivativesCity Bank’s convertible bonds and equity derivatives teams open avenues of financing and investing linked to the equity asset class - all underpinned by local market knowledge, deep client relationships and innovation

20

Chapter 4Retail Banking

3.1 Deposit Products3.2 Retail Loan

3.3 NRB (Foreign Remittance)3.4 Card Service

3.5 SMS Banking 3.6 Others

4.0 Retail Banking

One of the most remarkable success stories of last 50 years' banking industry globally has been the conceptualization and innovative execution of banking with individual customers, their friends & families. The industry has termed it as Retail Banking or Personal Banking or Consumer Banking; and it has now - at a very rapid pace - become the major revenue line for most of the top banks in the world. City Bank always try to fulfill any types of need of their retail or non-business consumers with their best effort. "City Retail - add a little city to your life" is the new brand-mantra, the pay-off line for City Retail. City bank want to provide our customers the best-in-class services, innovative products and financial solutions from smart outlets - all with a big smile that a consumer easily find his/her desired service that conveys and generates happiness all the way. City Bank’s retail banking have the following parts –

Deposit Products Retail Loan NRB(Foreign Remittance) Card Service SMS Banking Others

4.1 Deposit ProductsCity Bank mainly have two types of deposit products. One is accounts and other is deposit schemes. A detail information about them is given below

21

4.1.1 AccountsCity Bank have three types of accounts for their retail consumers. These are

- Savings Accounts - Current Deposit Accounts- Fixed Deposit Receipts

4.1.1.1 Savings AccountIt is a sound savings for retail customer. We give the major facilities and services to our customer through 83 branches allover in Bangladesh with our skilled manpower. Minimum balance: Taka 500/-Interest Rate:

Amount Rate

Below Tk. 1.00 Lac 6%

Tk. 1.00 lac to Tk. 5.00 lac 7%

Above Tk. 5.00 lac 8%

Customer Benefit:* Cheque-book facility* Opportunity to apply for - safe deposit locker facility* Utility payment service* Collect foreign remittance in both T.C. & Taka draft.

* Transfer of fund from one branch to another by

- Demand Draft- Mail Transfer- Telegraphic Transfer

* Transfer of fund on Standing Instruction Arrangement * Collection of cheques through Clearing House.* Online banking service.

4.1.1.2 Current Deposit AccountsOur current account meets the needs of individual and commercial customers through our schedule benefit.

Minimum balance: Taka 5,000/-

22

Interest Rate: Nil

Customer Benefit

Cheque-book facility Opportunity to apply for - safe deposit locker facility

Collect foreign remittance in both T.C. & Taka draft.

Transfer of fund from one branch to another by

- Demand Draft- Mail Transfer- Telegraphic Transfer

Transfer of fund on Standing Instruction Arrangement

Collection of cheques through Clearing House.

Online banking service.

4.1.1.3 Fixed Deposit Account

Period of Scheme: Can be opened for a 1 month to 12 months.

Principal amount: Any handsome amount.

Interest rate:

Period Rate

1 Month/ 2 Months / 3 Months 11%

4 Months to 11 Months 12%

12 months 13%

Features:- Interest is compounded once a quarter- Loan may be allowed upto 80% of the deposited amount under lien.

23

- Excise duty and source tax etc. are deductible from the depositor profit.

4.1.2 Deposit SchemesUnder deposit scheme, the City Bank Ltd. (CBL) offers different types of products (scheme) to help the fixed income people to save money and meet any future financial obligations. The schemes offer a large amount of money after a certain period of time if the account holders deposit a specific amount on monthly basis. Bank currently offer five attractive schemes for their customers for different purposes. These schemes are –

City Onayash

City Somridhdhi

City Ichchapuron

City Projonmo

4.1.2.1 City Onayash

City Onayash - earn easy on your savings account, earn profit every month. City Onayash is a unique kind of savings account which calculates interest on your daily balance and pays interest to you every month.

It is a major departure from the conventional savings account available in the market. All such accounts calculate interest on the average or lowest balance of the month, while City Onayash does on daily product basis. Not only that, while those conventional savings accounts pays interest only twice a year - in December and June - City Onayash pays it to you every month. Happiness at each month’s end.

Eligibility:

Age: At least 18 years Nationality: Bangladeshi

Availability: All 83 of City Bank branches spread across the country.

What you to do: Just fill up the City Onayash account opening form and hand it over to our branch staff.

Special Features:

Withdraw and deposit cash as wish without at all having your monthly interest earning eligibility.

24

No hidden or undisclosed fees or charges or profit-cutting

Interest forfeiture rules of a common conventional savings account do not apply here. So, stay tension-free-100%

Every month’interest earning goes into your account automatically. What better way to take care of family by recurring monthly expenses.

Interest Rate: 5.50%

4.1.2.2 City Somridhdhi

City Shomridhdhi is an exceptional DPS product that is distinctly more attractive than the prevalent DPS products in the market. One can receive a hefty sum at the end of the term against your monthly deposit of small installments. It's a perfect way to secure your financial future.

Eligibility:

Age: At least 18 years Nationality: Bangladeshi.

Features

No initial deposit required Monthly installment deposit ranges from Tk. 500 to Tk. 20,000

Flexible tenor of 3, 5, 7 and 10 years

On premature encashment, you get the maturity value of nearest term - not the routine savings rate.

Profitability Matrix:

Term Interest Rate

Three Years 10.0%

Five Years 10.25

25

Seven Years 10.50

Ten Years 11.0%

4.1.2.3 City Projonmo

City Projonmo a financial safety for future generations backed by complete immense protection.

City Projonmo is a unique monthly deposit scheme that one can open for his/her kids to safeguard their future against all uncertainties and risks. As a guardian of the child one can open this account which builds great & unmatchable savings for you over the years. By the time your child is past his or her school age, there is this sufficient cash in your hand to take care of his / her higher education, marriage or other such large expenses.

However, the most interesting part of this scheme is the full insurance protection that one automatically enjoy. This simply means, in case of death or total physical collapse of the parent or guardian, the bank will pay the full value of the scheme for the full term no matter in reality how many months or years have been actually completed by the consumer.

Eligibility:

Age: At least 18 years Nationality: Bangladeshi

Availability: All 83 of City Bank branches spread across the country.

What you to do: Just fill up the City Onayash account opening form and hand it over to

our branch.

Profitability Matrix:

Term Interest Rate

26

Five years 9.25

Ten Years 9.50

Fifteen Years 9.0

Twenty Years 9.0

4.1.2.4 City Ichchapuon City Ichchapurun, a great opportunity to earn against your savings every month. This product allows one to earn interest and enjoy interest every month that accrues in your fixed deposit account, no matter what the term of the deposit is. It helps make financial planning more disciplined, and makes life more organized. While the fixed deposit remains untouched and well-kept for future, one can keep on getting the profit on a monthly basis. That is the better way to take care of your monthly recurring expenses like children’s education or school fees, house tutorials’, remuneration, utility bill payments, saving money by this scheme. Eligibility:

Age: At least 18 years Nationality: Bangladeshi

Availability: All 83 of City Bank branches spread across the country.

What need to do: Just fill up the City Ichchapuron account opening form, deposit money and keep enjoying the fixed deposit interest every month. Moreover, there is the scope of getting personal loan worth up to 90% of your City Ichchapuron value.

Profitability Matrix:

Term Fixed Deposit

Amount

Interest rate Monthly

interest(Before Tax)

3 Years BDT. 1 lakh 11% BDT. 917.0

5 Years BDT. 1 lakh 11.5% BDT. 958.0

27

4.2 Retail Loan

In this part City Bank deals with the consumer credit and non-business loans. Now a days more or less all banks are profit oriented; some times high default risk encourage banks to put importance on retail loans. It is a great opportunity for middle class and fixed income people to fulfill their demand or dreams. City Bank have two types of retail loans:

City Drive City Solution

4.2.1 City Drive

Owning a car is no longer a luxury. Car for your family is now a matter of fulfilling a necessity. Appreciating that basic need, City Bank introduces City Drive, a tailor-made auto loan scheme for individuals.

Features

Loan amount ranging from Tk. 300,000 to Tk. 20,00,000 Car financing up to 90% of reconditioned or new vehicle price

Lower interest rate & upto 100% financing for loan against cash security

Loan tenor 12 to 60 months

No hidden charges

Competitive interest rate

Loan processing fee 1% of loan amount

Eligibility

Age: 22 to 60 years Experience: Salaried executive total 1 year including 6 months with current

employer

Experience: Business person/propofessional 1 year

Monthly income: Minimum Tk. 30,000.

4.2.2 City Solution

28

To meet consumers any type of needs City Bank always ready to help them with their City Solution. Whatever the occasion or requirement may be, City Solution - any personal loan from City Bank - is there to solve all problems and to fulfill all their dreams. Whatever the wish is like child’s education expense, daughter’s wedding, dream vacation, domestic appliances, medical treatment; City Solution can easily make the dream into reality. The branches of City Bank waiting to help their retail customers

Features

Loan amount ranging from Tk. 50,000 to Tk. 1000,000 Loan tenor 12 to 60 months

No guarantor required for the loan amount up to Tk. 3 lac

No hidden charges

Competitive interest rate

Processing fee 1%

Eligibility

Age: 22 to 60 years Experience: Salaried executive total 1 year including 6 months with current

employer

Experience: Business person 2 years; Professional 1 year

Minimum monthly income: Salaried executive Tk. 15,000; self employed Tk. 25,000 and business person Tk. 30,000

4.2.3 Loan Take-over Plan

An exclusive offer for other bank's credit worthy customers who can now transfer their personal loan outstanding to City Solution with a preferential interest rate and waiver on processing fee.

Eligibility Minimum 6 loan EMI repayment with existing bank A minimum take over loan amount is Tk. 1,00,000 and maximum Tk 9,50,000

Benefits

29

No processing fee No extra cost for loan takeover No processing fee for additional loan 1% reduced from City Solution interest rate.

4.3 NRB (City Foreign Remittance)The city Bank's Foreign Remittance unit meets growing customer needs for fast, secure & easy money transfers to an extensive range of destinations. Being a committed bank to its customers, we go all the lengths to remit your hard earned money safely to your loved ones. With us, apart from a range of high-class modem remittance solutions, you will get peace of mind which we believe counts to most.

FacilitiesCity Bank Limited has 83 online branches across the country, Besides, the Bank has a strong remittance network with other major banks of the country. Therefore, wherever your account is, we are able to send your money instantly.Foreign remittance service always ready to help an account holders to receive remittance according to their needs at earliest convenience.CBL understands the value of customers’ precious time. That's why they have made the payment procedure simple & easy. One has the privilege of enchasing the remitted money instantly from the branch counter without going through any hassle. That is to say, an account holder of City Bank, they can instantly credit the money to the account or pay cash to the receiver.So, place the trust with City Foreign Remittance Service. Send your money to your loved ones & experience peace of mind.

4.4 Card ServiceTo ease the transaction of money in different purposes, City Bank helps their customer by card service. Mainly, City Bank have two types of cards for their customers. One is debit card and another one is credit card.

4.4.1 Debit CardThe debit card of City bank is known as “Visa Electron Debit Card”. To make the consumers’ life hassle free and safe Visa Electron branded; which makes you the proud owner of a meaningful plastic.

Features Cash withdrawal from 500+ Visa ATM booths all over the country anytime. Shop and dine at hundreds of merchant Visa outlets all over the country Balance enquiry Fund transfer from your account to credit card anytime

30

PIN Change Mini statement Cash withdrawal @ Taka 12 per transaction at 250+ DBBL ATMs and free from

City booths.

EligibilityAn individual who has a savings, current or STD account in City Bank (CB), eligible for this card. By collecting an application from any nearby CB branch form and submit duly filled up form; within shortest time the person will get the card delivered at his/her mailing address or at designated branch.

4.4.2 Credit CardCity Bank currently have five different types of credit cards for their consumers. Among the five, the City Card is the most attractive one. Except “City Card” other credit cards are Visa Local Classic, Visa Classic Dual, Visa Gold Local, Visa Gold Dual. A detail view of the five cards is given here-

4.4.2.1 City Card

City Bank is the first bank to issue Dual Currency Credit Card in Bangladesh. This card enables simultaneous usage of your card both in home and in abroad. For this a person do not need to carry two different cards for the same purpose. City Bank launched their smart card - ATM card, credit card, debit card & utility bills payment card all in a single card in the name & style of "City Card".

Features

Variable Interest Rate: Variable Interest Rate is the application of different interest rate based on the transaction volumes done through your CB credit card. The more the transaction with “City Card”, the less interest rate is charged on transaction amount. In Bangladesh, City is the first bank to care the volume of transactions with your credit card.

EMI Plan: CITY Card EMI plan is an instalment plan that allows cardholder the flexibility to convert any retail purchase transaction into an instalments scheme where the cardholder pays back the amount at a rate of interest as low as 16.99% per annum over a tenor ranging from 6 months to 36 months. The customer enjoys the flexibility to buy high value items on The City Bank credit card and conveniently pay in monthly instalments at a lower interest rate. The minimum transaction amount eligible for an instalment plan is BDT 3,000.

Balance Transfer: It's an exclusive offer for other bank credit cardholders from CBL. Balance Transfer is a very effective programs how CBL can acquire a huge number of other member's cardholders by offering a preferential rate of interest

31

and attractive fee to bring them to our shop. It is a very common program in Europe and other matured credit card market.

The requested amount of the credit card will take over by CBL with a preferential variable rate of interest. A processing fee will be charged @ of 1% or a fixed amount on the outstanding amount which ever is higher. For Visa Classic it is BDT 500 and Visa Gold BDT 1000. A minimum balance transfer amount is BDT 10,000 and maximum BDT 4, 80,000. CBL will pay the outstanding amount by pay order or cheque at a time to previous issuer. CBL may issue a higher limit to the cardholder and it is sole discretion of CBL. It will be subject to satisfaction of the credit analyst based on the support of the income documents and cardholder's transaction behavior. Age of the previous card must be at least 6 months.

Round the clock cash withdrawal facility at any Visa branded ATM throughout the world

Round the clock purchasing power for goods and services at any Visa branded POS outlet

24% interest on Cash Advance No cash Advance fee at CITY ATMs Lowest Annual/Renewal Fee International Roaming facility Internet Transaction Convenient Repayment option E-statement Limited Lost Card Liability Secured with your Photo - Photo Card 24 hours customer service help desk.

Eligibility Bangladeshi Nationals Age range for primary card holder is 18 years to 60 years Age range for supplementary card holder is 18 year to 60 years Age bar can be relaxed for secured cards Minimum Gross Monthly Income(GMI) for silver card Tk 12,000 Minimum Gross Monthly Income(GMI) for gold card Tk 30,000 Minimum 6 month permanent employment for salaried executives (this indicates

total length of service as a total of all companies he or she has worked for), and 1 year of experience in business or practice for self employed professionals and business person

4.4.2.2 Visa Local ClassicThis is a local Visa Credit Card which is valid only in Bangladesh. It can only be used in local currency (BDT) within the country. This type of credit card has a limit ranging from BDT 10,000 to BDT 49,999. This type of card has designed for medium earner category customers. Usage: Local Classic/Silver Card (For Domestic use only)Limit: Local Classic/Silver Card BDT 10,000 - BDT 49,999.

32

4.4.2.3 Visa Classic DualThis is basically one plastic that has dual options to make transaction in two currencies. Its acceptance jurisdiction is in country and outside country in BDT and USD respectively. Classic dual is for the medium earner category customers. Its credit limit is USD 100 to 1000 and BDT 10,000 to BDT 49,999.

Usage: Dual Classic/Silver Card (For both International & Domestic use)Limit: Dual Classic/Silver Card BDT 10,000 - BDT 49,999 + US$ 500 - USS$ 1,999.

4.4.2.4 Visa Gold LocalThis type of card is taka card of which acceptance jurisdiction is only in Bangladesh and transaction currency is BDT. The differences between these two cards are higher credit limit than classic card. Credit limit of Visa Gold card is ranging from BDT 50,000 to BDT 5, 00,000. This type of card has been designed for the higher earner category customers.

Usage: Local Gold Card (For Domestic use only)Limit: Local Gold Card BDT 50,000 - BDT 500,000

4.4.2.5 Visa Gold DualThis is a high value dual card remaining other features same with classic dual. Gold dual is also for the higher earner category customers and its credit limit is USD 1,001 to 4000 and BDT 50,000 to BDT 500,000. A secured dual card�s limit will be maximum USD 28,000 against lien on RFCD or ERQ account.

Usage: Dual Gold Card (For both International & Domestic use)Limit: Dual Gold Card BDT 50,000 - BDT 500,000 + US$ 2,000 - US$ 3,000.

4.5 SMS BankingCity SMS gives 24-hour access to the key financial information of your City Bank Account. It is the simplest way of finding out account's daily/month-end balance. With City SMS you neither have to wait for account holder’s statement to arrive through mail nor have or call up branches to inquire about balance and last few transaction. Once a person become a member of SMS Banking you will have 24-hour access to the key financial information.

Facility:

Through City SMS Banking one will be able to access your account information like balance, transaction and a range of other financial information by typing a predefined letter with 4 digits PIN (Personal Identification Number). Presently following functionalities are available through City SMS Banking:

Balance Inquiry Transaction Inquiry PIN Change

33

Eligibility: All account holder of the City Bank Limited Having account in Online Branches are eligible to apply for SMS Banking Service. See the list of our online branches overleaf.

4.6 Other ServicesBesides the services discussed above in the retail sector City Bank have many other services to ensure better perfection to consumers. These are-

Utility Services Safe Deposit Lockers Travelers’ Cheque Demand Draft (DD), Pay Order (PO), Telegraphic Transfer (TT), Online Banking

4.6.1 Utility ServicsThe City Bank Limited offers multiple special services with its network of branches throughout the country in addition to its normal banking operations.

For Collection various types of Bill:

Electricity Bills Telephone/Mobile Bills Water/Sewerage Bills Customs & excise duties Gas Bills

For Sale & Encashment/Purchase different products like: PrizeBonds Lottery tickets of different Semi-Govt. and Autonomous Bodies.

4.6.2 Safe Deposit LockersOnly Savings / Current account holder of CBL can apply for a locker. There are three (3) types of locker available in Gulshan Branch. These are:(1) Large (2) Medium (3) Small

Charges:

Locker Types Charges (per year)

Large Tk. 2,500

Medium Tk. 2,000

Small Tk. 1,500

Minimum balance: Savings / current account balance Taka 5,000.00

Features:

34

Rented for a period of one year and will automatically be renewed Access at anytime during the bank’s business hours All rentals are payable annually in advance.

4.6.3 Travelers’ ChequeTo reduce the hazard of the travelers to carry money and to think about the currency City Bank has travelers’ cheque service. It has the following features

Safe and convenient All major currencies and denominations Free of commission to account holders Available through American Express Can be bought and sold in various currencies Guaranteed security

4.6.4 Demand Draft (DD)

Demand Draft or DD is an instrument containing an order by the issuing branch upon another branch known as drawee branch, to pay a certain sum of money to the payee or to his/her order on demand. This is the easiest way to carry a large amount of money from one place to another with minimum risk.

4.6.5 Pay Order (PO)

Payment Order or PO gives payee the right to claim payment from the issuing branch. In other words it is an undertaking by the issuing bank to pay a certain sum of money to the payee or to order on demand.

4.6.6 Telegraphic Transfer (TT)

At customers’ request branch transfers fund to another branch through Telex and it is known as the TT, in short. TT facility is available only in that branch having Telex facility. Now, it is easy to done by mobile. Customer fills up the TT form and pays the amount along with commission in cash or by cheque. The confirmation slip is send by post.

4.6.7 Online Banking

Out of our 84 branches including one Islamic banking, City Bank operate all the branches as online banking. These branches are designed to serve its valued clients. Under this system, client will be able to do the following type of transactions:

o Easy to withdraw or deposit from any online brancho Fund transfer with one click, no need TT/DD.o Client can easily tell which payments have cleared

35

36

Chapter Five

SME Banking5.1 City Muldhan

5.2 City Sheba 5.3 Shulov

5.0 SME Banking

City Bank’s SME Division was formally formed in the bank in the middle of 2005. Before that, banking facilities (with focus on extending credits) were available for SME s in traditional and conventional unstructured-method. The paramount necessity of making separation of core banking functions and centralization of businesses and surrounding support functions to attain large scale results in production and delivery of various SME friendly assets and liabilities is gradually putting in reality. The present management is taking necessary measures and initiatives to re organize entire banking business including SME business in centralized fashion in line with the models being practiced by other modern and industry best practicing banks.

SME Banking of City Bank is assuming a new and modern dimension. It is entering in to a wider horizon. The philosophy of extending banking services to SME's of the country is to meaningfully push every one of them up to the next level of respective business operations. The upward push would be meaningful as they would be business wise competitive for a sustainable future. It is therefore would be turning in to an abode of SME's to grow to the next level. Hence, the bank has named it City Business - for taking SME's to the next level.For the first time in the history of City Bank, SME Banking business processes are going to be driven thru a centralized platform model. This is a fundamental move away from a 25 years legacy system of decentralized geography based branch banking model. We all know this transformation process and momentum is already in place. This would be completed by 2008.

A few months back City Bank’s SME sector was divided in two parts. But, City realize the necessity of this fast growing sector and after their silver jubilee they introduced “City Business” for the SME sector. This “City Business” have thee different parts according to the needs of different SME entrepreneurs. These are:

City Muldhan City Sheba City Shulov

37

A detail information about them is given here-

5.1 City MuldhanSME business in Bangladesh mostly requires active financial / banking support for their business to grow. To cater various such needs of different trade related business like export-import, City introduced a complete tailor made package which surely will meet your specific financial needs and services.

Features

Loan amount ranging from Tk. 500,000 to Tk. 40,00,000 Competitive interest rate. Flexible security arrangement. Complete business solution. Considerations of cash transactions besides bank statement. Quick approval process.

5.2 City ShebaTo facilitate different concerns engaged in service related industry , The City Bank is going to introduce a customized product naming CityBank Sheba . The product will positively satisfy different business related needs of the clients involved in different service sectors.

Features

Loan amount ranging from Tk. 500,000 to Tk. 40,00,000 Competitive interest rate. Flexible security arrangement Quick approval process. Considerations of cash transactions besides bank statement.

5.3 City ShulovA unique product to facilitate concerns engaged in manufacturing business . It is especially developed for small firms. The product will facilitate to meet up diversified needs to different manufacturing concerns.

Features

Loan amount ranging from Tk. 500,000 to Tk. 40,00,000 Competitive interest rate Flexible security arrangement Quick approval process. Considerations of cash transactions besides bank statement.

38

39

Chapter Six

Treasury & Market Risk

6.1 Overnight Deposits6.2 Term Deposits

6.3 Foreign Exchange (Forex)6.4 Local Currency Spot & Forward

6.5 Derivatives

6.0 Treasury & Market Risk

City Bank Ltd. (CBL) has a dedicated Treasury & Market risk department which is capable of providing all treasury Solutions. Through their foreign correspondent business partners CBL is providing a wide range of Treasury products. In CBL Treasury, there are four teams who are specialized in their own area to ensure the best possible solution to our customer requirement. CBL has following teams in the Treasury:

01. Foreign Exchange02. Money Market03. Corporate Sales04. ALM & Market Research

Each team is dedicated to provide best solutions to their respective areas. Through their four dedicated team City Bank provide the following services:

a) Client Solution & Risk Management: City Bank’s this service sector includes hedging solutions against adverse market movements, advice on efficient hedging policy, structured products to match customers' needs and corporate Advisory Services.

b) Product Range: Product range includes foreign Exchange, Money Market(Call Money, term Deposits, securities, Repo & Reverse Repo) , Foreign Currency & Commodity Derivatives.

c) Market Information & News Update: It have Economic Research & Technical Analysis and market report(Daily, Quarterly & Half Yearly)

City Bank’s treasury & market risk service have five important sub-parts. These are-

Overnight Deposit Term Deposit Foreign Exchange (Forex) Local Currency spot & Foreword

Here is a detail information about Them:

40

6.1 Overnight DepositFunds which are placed / borrowed for overnight are known as overnight deposit. Rates of the overnight deposit are fixed on a daily basis and the rate keeps on changing on the basis of demand and supply of any day. It is used to meet up the daily fund management of all financial institutes. Overnight deposit is also known in the market as call deposit.

City Bank (CB) is an active participant of the inter-bank call market. CB injects market liquidity and plays an important role in the inter - bank call money market.

Benefitsi. Due to the nature of product it has minimum credit risk as the tenor is

overnight.ii. Very effective tool to manage daily liquidity management.

iii. Call money rates indicates the market liquidity.iv. Traded in bulk volume.

6.2 Term DepositsA deposit held at a financial institution that has a fixed term. These are generally short-term with maturities ranging anywhere from a month to a year. When a term deposit is account are opened, the lender/borrower understands that the money can only be withdrawn after the term has ended or by giving a predetermined number of days notice.

Inter-bank term deposits are considered as relatively safe investment and these are especially very appealing to conservative, low-risk investors who are expecting a adverse interest rate movement.

City bank has a strong presence in the inter-bank term deposits and Mudaraba Term deposits market. Due to their presence in both conventional banking and Shraiah banking City is one of the liquidity provider in the inter-bank Term deposit market.

Benefitsi. Due to its nature of fixed term, it minimizes interest rate risk during the

tenor of the deposit.ii. Helps to manage Balance Sheet Gap.

iii. Reduce too much dependency on call market thus helps to manage regulatory liquidity requirement.

iv. Depending on the forward yield curve can be used to maximize returns on investment.

6.3 Foreign Exchange (Forex)

41

Foreign Exchange market is known as the market in which currencies are traded. The forex market is the largest, most liquid market in the world with an average traded value that exceeds $1.9 trillion per day and includes all of the currencies in the world. The volume of this market is increasing continuously.

There is no central marketplace for currency exchange; trade is conducted over the counter (OTC). The international forex market is open 24 hours a day, five days a week, and these currencies are traded worldwide among the major financial centers of London, New York, Tokyo, Frankfurt, Hong Kong, Singapore, Paris and Sydney.

The forex is the largest market in the world in terms of the total cash value traded, and any person, firm or country may participate in this market.

6.4 Local Currency Spot & ForwardCity Bank’s currency is not fully convertible thus it is not traded across the world. Their currency BDT is traded in our local market and this market is regulated as per our foreign exchange regulation and central bank core risk management guidelines.

The City Bank Ltd. is very active in the inter-bank USDBDT market and one of the leaders among the local private banks. City treasury provides market information and competitive price in USDBDT. It has wide source of foreign currency through its Exporter, Exchange Houses and different local and multinational corporate customers. Its dedicated local currency desk is designed to provide tailor made solution for USDBDT trade.

Spot & Forward both are used to manage foreign exchange risk. Forwards, especially in our economy where our local currency BDT devalues periodically against USD, is very popular among the importer to hedge BDT devaluation risk.

Major Currency Spot & Forward: City Bank also well equipped to price world major currency spot & forward price. City Bank’s treasury is connected to the international market quotes very competitive prices on world major currency spot & forwards.

6.5 Derivatives In finance, a security whose price is dependent upon or derived from one or more underlies assets. The derivative itself is merely a contract between two or more parties. Its value is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, commodities, currencies, interest rates and market indexes. Most derivatives are characterized by high leverage.

Futures contracts, forward contracts, options and swaps are the most common types of derivatives. Because derivatives are just contracts, just about anything can be used as an underlying asset. There are even derivatives based on weather data, such as the amount of rain or the number of sunny days in a particular region.

42

Derivatives are generally used to hedge risk, but can also be used for speculative purposes. City Bank’s Treasury team has a verity of derivatives products for its corporate customers:

a) Foreign Exchange: Options, SWAPS and Forwardsb) Interest Rate Swapc) Commodity Derivatives: Commodity Options, Commodity Forwards,

Commodity Futures and Commodity SWAP.

43

Chapter Seven

Conclusion

7.0 Conclusion

“City Bank” a name of trust and reliability for last 25 years. City Bank says, “Making sense of your money”, to ensure their customers a better service. Persons earn money after their hard work; so, proper utilization of money is very much needed in our society. City simply knows which field of our economy need money and help their clients to make proper utilization of that money. They also keep in mind to ensure a greater profit of people’s deposited money. City Bank is a bright example to make a proper combination of corporate and retail banking. So, City Bank make sense of money by their proper utilization. City satisfy their customers with their better service and well behavior of their expert staffs. For significant performance, The Bank has earned national & international recognition. The City Bank Limited was one of the 12 Banks Of Bangladesh among the 500 Banks in Asia for it's asset, deposit & profit as evaluated by "ASIA WEEK" In The Year 2000. Other than that, The City Bank Limited received the "Top Ten Company" award from the Prime Minister Of The People's Republic Of Bangladesh. So, City already prove their efficiency to the customers and promise for better service in future.

44

45

Appended Part

BibliographyReference

Bibliography

www.thecitybank.comwww.wickipedia.com

Commercial Bank Management- Peter S. RoseBusiness of Banking- R M Debnath

Reference

Md. Nur-A-KaosarAVP & ManagerKhatungonj Branch, Chittagong.City Bank.Tel: 031-612681, 638054

46