LETTER OF TRANSMITTAL

23rd January, 2018

To
Controller of Examination
National University
Gazipur-1704

Subject: Submission of Internship Report on ‘Financial Performance of Sonali

Bank Limited’.

Dear Sir,
With due respect I would like to inform you that, I am submitting my internship report
on ‘Financial Performance of Sonali Bank Limited’. I have collected useful and
relevant information from different web site and bank monthly statements to make
this report as a descriptive as possible.

The report contains a comprehensive study on ‘Financial Performance of Sonali

Bank Limited’. It was a great pleasure for me to have the opportunity to work on this
topic. I have endeavor my best to come out with a good one and also if I do any
mistake (involuntary), then please try to forgive me.

Finally, I would like to thank you for valuable guidance and supportive in preparing
this report. I will be grateful for any classification when require. I shall be highly
obliged if you kind enough to approve this report and provide your valuable judgment
on it.

Sincerely Yours

Romana Afrose Rimi

REG. NO: 2096972
Program: BBA
Major: Finance
Department of Business Administration
Mirpur College
Mirpur, Dhaka - 1216.

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 Student’s Declaration

I do hereby declare that this internship report on ‘Financial Performance of Sonali

Bank Limited’ has been written by me under the appropriate guidance of
Mohammad Hafiz Al Asad, Assistant Professor and chairman of BBA Department,
Mirpur College in fulfillment of the requirement for the award of Bachelor of
Business Administration (BBA).

I am also declaring that this report was not submitted for any degree or title
recognition before.

Romana Afrose Rimi

REG. NO: 2096972
Program: BBA
Major: Finance
Department of Business Administration
Mirpur College
Mirpur, Dhaka - 1216.

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 Supervisor’s Certificate

This is to certify that the Internship Report titled ‘Financial Performance of Sonali
Bank Limited’ has been prepared by Romana Afrose Rimi, bearing REG. no:.
2096972, BBA Program has been acknowledged and accepted with gratification. This
Internship Report can be accepted as a constructive work and significant part of the
whole program.

The report has engaged his all out efforts to maintain the highest standards in all
spheres of carrying out the study.

Supervisor

Mohammad Hafiz Al Asad

Assistant Professor & Chairman
Department of Business Administration
Mirpur College
Mirpur, Dhaka - 1216.

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 Acknowledgement

Express all of my gratitude and praises to the almighty Allah, who has granted me
time and insistence to make this report at reality.

I am extremely grateful to my supervisor Mohammad Hafiz Al Asad, Chairman of

BBA Department, Mirpur College. For his valuable inputs, ideas and help in making
available of all the reference materials for the study. I am also incepted to him his
proper guidance and appreciation that has enabled me to find a right track in carrying
out the study and preparing this report.

A lot of effort and study have gone into prepare this report. This would not have been
possible without the genuine support and assistant provided by the person whom I
approached during various stages of preparing this report. Although time and space
constrain me to mention all of them there, I am nevertheless and grateful for their help
and of the patience that showed during my frequent interruption of their own jobs for
satisfying my various doubts and curiosities.

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 Summary
Mirpur College gives deep concentration to acquire higher specialized knowledge of
Banking Sector through its BBA program under the Department of Business
Administration. To become efficient in any subject, familiarity with the practical
working knowledge is essential besides the academic theoretical study. Therefore the
Department of Business Administration gives importance to submit this report to
fulfill the requirement of the Internship Report at the end of the BBA Program as an
indispensable element of said Program. Being a student Department of BBA of the
Mirpur College. I have tried to put my best effort to organize all the required
information in a document manner in order to make the report comprehensible and
fruitful.

This internship report is prepared based on the study of Sonali Bank Limited (SBL),
Rokeya Sarani branch, Dhaka. The topic of this study is ‘Financial Performance of
Sonali Bank Limited’.

This part also included references which I used to prepare the report. For ease of
understanding, the report is segmented into five parts. In the first part contains
background of the report, objectives, scope, methodology and limitations of the
report. Next part of the report demonstrated the profile of the organization where I
have completed my intern. The Third part is conceptual framework. Fourth Part, main
part of the Report, named ‘project’ contains details about the financial activities of the
bank. At the last part, I have tried to find out the facts from internship from the
organization and also give some suggestions where the firm could have scope to
improve.
The current ratio of SBL has increased from year 2009 to 2010 but from year 2011 the
current ratio is decreasing. Again in year 2013 ratio is increased. That means it has
average liquidity position. The firm can able to pay its current obligations.

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The cash ratios of SBL for the first 3 years are increasing but in the year 2009 the
ratio is quite low. That indicates the firm has strong lines of cash available on short
notice. In year 2011 again the ratio is increased.
Cost of deposit of SBL in 2009 was highest and in 2010 it was lowest. SBL should
take necessary steps to mobilize low cost or no cost deposits to keep the cost of
deposit at minimum.
Return on credit of SBL in 2013 was highest and in 2011 it was lowest. SBL should
take necessary steps to mobilize high return on credit to keep the return on credit at
maximum.
Return on total assets of SBL in 2009 was lowest and after 2010 the return on total
assets were increasing. That shows SBL tries to enhance their net profit before tax
generating from assets.
Return on equity of SBL in 2009 was lowest and in 2010 the return on was highest.
SBL should take necessary steps to enhance their net profit after tax using equity.
A high debt/equity ratio generally means that a bank has been aggressive in financing
its growth with debt. The debt equity ratio of SBL indicates that in 2009 it was highest
and in 2010 it was lowest which posses that debt used more than equity.

SBL is a moderate good organization as its operating system is fully computerized

and its working environment is better than any other Bank. But it has some negative
sides also such as centralized decision making power, lack of qualified financial etc.
Obviously SBL is a developed organization. For more development it can manage
some operations such as analyzing of current data oriented activities, development of
training department and IT department, decentralization of decision making power
etc.

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 ACRONYMS

SBL : Sonali Bank Limited

IT : Information Technology
BBA : Bachelor of Business Administration.
CEO : Chief Executive Officer.
A/C : Account
P/O : Pay Order
WTO : World Trade Organization
IPO : Initial Public Offering
FDR : Foreign Direct Receipts
LC : Letter of Credit
SME : Small and Medium Enterprise
GB : General Banking
ATM : Automated Teller Machine
MUC : Mirpur University College, Dhaka
IMF : International Monetary Fund
IME : International Monetary Express
GDP : Gross Domestic Product

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 CONTENTS

SL# Particulars Page#

1. Letter of transmittal I
2. Student’s Declaration II
3. Supervisor’s Certificate III
4. Acknowledgement IV
5. Summary V
6. Acronyms VII
7. Contents VIII
8. List of Tables X
9. List of Figures XI
10. List of Graph XI

CHAPTER-01: INTRODUCTION 1 to 5
1.1 Introduction of the Study 2
1.2 Background of the Study 2
1.3 Objectives of the Study 3
1.4 Methodology of the Study 3
1.5 Time Schedule of the Study 4
1.6 Scope of the Study 5
1.7 Limitations of the Study 5

CHAPTER -02: PROFILE OF SONALI BANK LTD. 6 to 23

2.1 Historical Development of the Organization 7
2.2 Vision, Mission, and Goals 7
2.3 Management 7
2.4 Organization Structure of SBL 8
2.5 Corporate Profile of Sonali Bank Limited 9
2.6 Products and Services 10
2.7 Evaluation & Comments of World Bank 20

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CHAPTER -03: CONCEPTUAL FRAMWORK 24 to 33
3.1 Definition of Bank 25
3.2 Concepts of Bank 26
3.3 Types of Bank 27
3.4 Benefits of Bank 29
3.5 Problems faced by a Bank 30
3.6 Definition of 'Financial Performance 31
3.7 Financial Performance Analysis 31
3.8 Financial Activities 32
3.9 Financial Statement Analysis 32
3.10 Ratio analysis 32

CHAPTER -04: ANALYSIS AND FINDINGS 34 to 57

4.1 Financial Analysis 35
4.2 Rural Deposit Scheme (RDS) 35
4.3 Marriage Savings Scheme (MSS) 36
4.4 Monthly Earning Scheme (MES) 37
4.5 Double Benefit Scheme (DBS) 37
4.6 Medicare Deposit Scheme (MDS) 38
4.7 Sonali Deposit Scheme (SDS) 39
4.8 Education Deposit Scheme (EDS) 39
4.9 Consumer Credit 40
4.10 Loan Facility for Diagnostic Center 41
4.11 Special Small Credit Scheme 41
4.12 Foreign Employment Credit Scheme 41
4.13 Performance at a glance 42
4.14 Income Statement, Cash flow Statement and consolidated
Balance Sheet (For year ended 2016) 43
4.15 Evaluating Liquidity Position 44
4.16 Evaluation of Operating Efficiency 46
4.17 Operating Profitability Ratios 50
4.18 Risk Analysis 52

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4.19 Sensitivity Analysis 53
4.20 Scenario Analysis 54
4.21 SWOT Analysis 55
4.22 Major Findings of the Study 57

CHAPTER -05: CONCLUSION AND RECOMANDATION 58 to 61

5.1 Recommendations 59
5.2 Conclusion 61

Reference 62

Table# Caption Page#

Table 01: Time Schedule of the Study 4
Table 02: Procedure of Rural Deposit scheme (RDS) 35
Table 03: Procedure of Marriage Savings Scheme (MSS) 36
Table 04: Procedure of Payment of Monthly Interest (MES) 37
Table 05:. Yearly ret of interest of DBS All types of vat according to
government rule will be deducted from the account 37
Table 06: Cumulative total after end of duration of MDS 38
Table 07: Cumulative total after end of duration of SDS 39
Table 08: Cumulative total after end of duration of EDS 39
Table 09: Features Consumers' Credit Scheme 40
Table 10: Features Consumers' for Diagnostic Center 41
Table 11: Features Consumers' for Special Small Credit Scheme 41
Table 12: Features Consumers' for Foreign Employment Credit Scheme 42
Table 13: Performance at a glance 42
Table 14: Income Statement, Cash flow Statement and consolidated
Balance Sheet (For year ended 2016) 43
Table 15: Current Ratio 44
Table 16: Cash Ratio 45
Table 17: Net Working Capital 46
Table 18: Interest Margin 47

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Table 19: Cost of Deposit 48
Table 20: Return on Credit 49
Table 21: Return on Total Assets (ROA) 50
Table 22: Return on Equity (ROE) 51
Table 23: Business Risk 52
Table 24: Debt-Equity Ratio 52
Table 25: Sensitivity Analysis 53
Table 26: Scenario Analysis 54

Figure# Caption Page#

Figure 1: Structure of SBL 8

Graph# Caption Page#

Graph-1: Current Ratio 44
Graph-2: Cash ratio 45
Graph-3: Net Working Capital 46
Graph-4: Interest Margin 47
Graph-5: Cost of deposit 48
Graph-6: Return on Credit 49
Graph-7: Return on total assets 50
Graph-8: Return on Equity 51
Graph-9: Debt-equity ratio 53

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