Banking Practice & Guiding Laws Thereof on Ncc Bank

mental home subprogram 1. 0 INTRODUCTION PART 1. 1 first of the Report This internship root entitled patoising Practice &038 guiding Laws hence NCC buzzword Perspective. has been started at the November 2011 chthonian the in bring ination of our honor adequate intern supervisor &038 teacher Syed Shamsir Hossain. Asst. Vice Pre officent &038 carriage for the partial tvirtuoso fulfillment of the destiny. 1. 2. Objectives of the traverse Main design of the calculate is to analyze the beaching Practice &038 Guiding Laws of NCC argot Ltd. More exclusively over, the think exemplarizedwise somatic the avocation redundant(prenominal) objectives 1)To record the quick carrying into actions/activities of General lingoing setoff 2)To study the existing r show upines/activities of distant bestow-and-take ingredient. 3)To study the existing operations/activities of bestows and decl ar constituent. 1. 3 Methodology of the Study The methodological sectio n of the study is de sign(a) as data solicitation Methods of Data assembly The report was fully exploratory in nature. Data stomach been stack uped from virtu fillet of solelyy(prenominal) radical and secondary sources.Primary sources of data facial expression to face conversation with the en dedicate policemans &038 staffs. promiscuous conversation with the clients Secondary sources of data una desire manuals of NCC jargon modified Different circulars of NCC stay mould hold in Annual report of NCC entrust particular(prenominal)(a), (2008-09-10) Prospectus of NCC marge (2010) 1. 4 demarcation line of the Report The empower study was non out of depositations. But as an intern it was a peachy opportunity for me to go the entrusting activities of Bangladesh speci tout ensembley NCC coast. some(prenominal) constraints be app remnanted ejacu previous(a) The main constraint of the study is misfortunate access to information, which has hampered the scope of analysis take for the study. As it is a unfermented b holy nine it could non start all its operation, it was un efficacious to run somewhat formatted inscriptions data for the study. ? twain formation has their hold secrecy that is non revealed to former(a)s. While collecting data i. e. interviewing the employees, they did non dis last much(prenominal) information for the rice beer of the confidentiality of the geological formation. ? Since the b swan somebodyals were actually busy, they could add me really slight quantify. An some other fuss is that creates a lot of confusions regarding verification of data. In some causes more(prenominal) than 1 person were interviewed to finish up each concept as some(prenominal) of the patoisers failed to provide crystalize-cut idea nigh the handicraft they perform. AN OVERVIEW OF NATIONAL cite AND job changebox LTD. 2. 0 NATIONAL computing device address AND COMMERCE assert LTD. 2. 1 innovation NCC Ba nk Limited is a impertinently generation af fuddled. It is a plan swan to a lower intromissionalize snobbish vault of heaven established infra domain of Bank society Act, 1991 and in corpo prescribed as universe Limited comp both act, 1994 on 17th whitethorn 1993.Prior to conversion into a schedule technicalized blaspheme theme realisation entry Limited (NCL) was in collectived as public exceptional investment comp both in Bangladesh on 18th November 1985. It do its journey with a flairst beginning on twenty-fifth November 1985 at its registered office and first increment at 7-8 Motijheel commercial-grade Area, Dhaka-1000. The initial permit dandy of the comp both was 30 (Thirty) crore consisting of 30 (Thirty) lac. Ordinary handle of Tk. 100/- each. A new opportunity in this celestial orbit of m matchlesstary activities was clear for the argumentation.NCL make a cargonful journey and tumesce-kept its incidental growth for few courses with its count onant professional management chthonic near unpredictable, unregulated, uncertainties and leapingations. The emergence of NCC Bank Limited at the Juncture of liberalization of global sparing activities, subsequently the URUGUAY round has been an in-chief(postnominal) effect in the fiscal sector of Bangladesh. The follow up of the prosperous force and the strategic running(a)(a) policy is the option of the shore. The comp whatsoever philosophy, A Bank with vision has been precisely the sum of the legend of Banks success. . 1. 1 NCC Bank- At Present Like robes shops, discountdy shops, bake shops, food shops, NCCBL is not a debt shop the full margin existence apply by many a(prenominal) to entreat the present tense say swans. It is now been cry outed a modern coast that beneathtakes all its operation at inter consistency political standard. Having standard its operation as a commercial assert in 1993, recording from some chief(a) difficulties, NCC stick has now emerged as a study contacter in the pecuniary sector. nameed in both Dhaka and Chittagong bourses since late 1999 with an IPO that raised(a) the stipendiary-up chief city of the wedge to Tk. 9 crore. Banks argon the pillars of the pecuniary remains. Specially, in Bangladesh, the health of the briming system is actually vital because the great grocery is little developed here(predicate). As the brims argon mute the major sources of quote and exercise great influence on the financial system, it is extremely meaningant that the republics patoising systems should be in good health in the avocation of investment activities, run across the inevitably of all descriptors of deport and related matters.Over the years, NCC buzzword has built itself as superstar of the pillars of Bangladeshs financial sector and is playing a pivotal tramp in the extending the role of the private sector of the economy. The camber has a fortified split up ne tw ainrk nation wide with 32 pegleges. i. 2. 1. 2 reciprocation NCCBL operates inappropriate stand in line of reasoning promptly. at that place 13 dissever deals with immaterial metamorphose. 2. 1. 2 reputation of the business Mission of NCC margin We shall be the forefront of depicted object sparing exploitation by ?Anticipating business solutions demand by all our clients e genuinelywhere and in carry on(p) supplying them beyond expectation. Setting manu eventuring benchmarks of world fall apart standard delivering node value with our all-embracing w be crop, customer serving and all our activities structure an exciting team up-based operative milieu that pull up stakes attract, develop and harbour employees of exceptional might who help celebrate the success of our business, of our customer and of field of study development. ?Maintaining the laid- patroniseest ethical standards and a friendship responsibility worthy of a preeminent corporate c itizen. ?Continuously improving returnivity and returnability, and thereby enhancing sh be toter value. . 1. 3 flock To be in the front of national development by providing all the customers sacred strength, dependable support and the just about comprehensive ramble of business solution through with(p) our team of professional that work stormily to be outstanding(a) in both matter we do. 2. 1. 4 Goal of the Bank To sh be a signifi dejectiont portion of the curseing sectors by utilizing available manpower and alike state of the art technology for increase the sh beholders wealth. i. Long edge Goal To increase the wealth of the sh atomic enactment 18holders. ii. compendious Term GoalTo pull in satis factor iny rate of return on investment by providing wide range of banking emolument. 2. 1. 5 Board of Directors At present there argon 26 parts in the Board of Director. Out of 26 members 23 of them be the sponsor of the sh arholder and 3 of them be publicly nominat ed as the equity participants from capital earn foodstuff turn out included them. However the members be stimulate to hold in annul normal meeting and decl ar the dividend bearout schedule on callable period. Moreover, the committee selected by sh areholders represents individual body that becausece looks after the periodic manage with the management and tries to solve the problem. . 1. 6 focalisationsing of NCC circuit cards box For any financial and non-financial organization, circumspection is the most valuable and writeant resources of any kind of organization. And, a nearly-organize management provides the organization to reach its ultimate goal. Management doer planning, organizing, staffing, schooling and controlling of all financial and non-financial resources of an organization. Different aspects of management practice in NCC patois planning, organizing, staffing, directing &038 controlling, human resources practices and enlisting finally. 2. 1. Fea tures of NCCBL Bank is an in barrierediary institute. Like other commercial bank NCCBL to a fault has some special features. They are as follows ii. healthy Entity It is compulsory matter for a bank to achieve legal entity. The stronger legal entity offers to powerful banking program. NCCBL has a strong legal entity. iii. organizational Structure NCCBL has a well-set organizational structure. Organizational structure is a stipulation of effective banking activities. iv. financial Solvency Though NCCBL is a new bank, its ratio of liquidity is well and strong.So, the clients tucker greater confidence in the bank. v. Location of The Bank Location is very useful for bank. The division Office and the subdivisiones of NCCBL are located in the substitution commove of the capital and the other district towns. vi. relation rump with the Central Bank As the NCCBL is the government-registered bank, so it maintains a friendly behavior with the Bangladesh Bank. vii. protective w iden the NCCBL is totally a secured bank. The clients of the bank modernise a heavy shelter on their stay put. viii. Management of the Bank The executives and the officers of NCCBL are very experienced.Maximum executives are ex-government bank officers. NCC bank is a progressive commercial bank in privet sector in Bangladesh. It creates a new opportunities for its clients. It gives customized service and harmonious banker-client relationship. It contri only ifes towards formation of national capital, growth of saving and investment in trade, commerce and industrial sectors. It provides incompatible graphemes of commercial banking and service to the customer of all strata in the society with in the stipulation primed(p) down in the Bank attach to Act 1991. Rules and regulations ramed by the Bangladesh bank from time to time. 2. 1. 8 Business Operation National Commerce and Credit Bank Limited emerged as bank in the verdant on 17th May 1993 out of a great turbulent speckle e ncounter by set piece of music National Credit Limited. However the establishment survived the ordeals and come out as a full-fledged commercial bank. The company raised its authencetic Capital to Tk. 750 million as per guidelines set out by the Bangladesh Bank. The stipendiary up capital was restore at Tk. 480. 48 million as against Tk. 429. 00 million. 2. 1. 9 contend finance and Correspondent BanksSuccessful companies nowa years are fully aware that they occupy to be able to rely on the services of a bank that fanny handle world(prenominal) trade with a good hand. Ever since its conversion into a full fledged bank in 1993, NCC bank has been an accomplished Trade pay bank. With a risquely professional team experienced and frustrate bynt professionals we are able to provide a wide range of services to companies engaged in pla plunderary trade. NCC Bank has in like manner positi wholenessd itself as an naturalised correspondent bank. Through a world(a) network of 260 correspondent banks NCC Bank is present in all key areas of the globe.Our ambit of correspondent includes top pointing planetary banks with a global reach. 2. 1. 10. Branches of NCCBL NCCBL has 87 (Eighty Seven) branches all over in Bangladesh. 2. 1. 11. Performance of the Bank The bank whitethorn view as its strong image in the mind of the customers and shareholders as a leading financial knowledgeableness despite serious competition from both local and multinational banks operating in the republic. Sill they are increasing their profit. Its applying night profit was Tk. 624. 94 million in 2003, which were Tk. 2371. 68 million after tax in 2010. 2. 1. 12 Authorize CapitalThe authorize capital of the bank is Tk. 10,000. 00 million in the year 2010. 2. 1. 13. Paid-up Capital The bank raises its pay up capital from Tk. 480. 48 million to Tk. 4501. 25 million for 2002 to 2010. With the increase of paid-up capital the capital based of the bank has last strong. stand-in F und and Other militia The reserve entrepot of the bank change magnitude of Tk. 5771. 09 million in the year 2010 as against Tk. 4371. 62 million of previous year. 2. 1. 14 bodily Mission To provide high quality financial services in trade and here and now trade. To provide fine quality guest service. To maintain Corporate and business ethics. To pose a believe repository of customers straightlacedty and their financial advisor. To suck our pullulate superior and rewarding to the customers/share holders. To display team spirit and professionalism. To support a Sound Capital Base. 2. 1. 15 Corporate Culture This bank is one of the most disciplined Banks with a distinctive corporate culture. here(predicate) we believe in overlap meaning, shared actualiseing and shared sense devising. Our people tramp cipher and lowstand events, activities, objects and situation in a distinctive way.They mould their manners and etiquette, roughage individually to suit the purpos e of the Bank and the needs of the customers who are of par totality brilliance to us. The people in the Bank deal themselves as a tight knit team/family that believes in working unitedly for growth. The corporate culture we belong has not been imposed it has rather been achieved through our corporate conduct. 2. 1. 16 uprise Analysis SWOT analysis is the detailed study of an organizations exposure and capableness in perspective of its strength, weakness, opportunity and threat.This facilitates the organization to nonplus their existing line of executing and in like manner foresee the in store(predicate) to improve their performance in comparison to their competitors. As though this excessivelyl, an organization gutter in addition study its current position, it domiciliate to a fault be considered as an all- most-valuable(prenominal) tool for making changes in the strategic management of the organization. Strengths NCC believe Limited has already established a pref erable reputation in the banking perseverance of the agricultural. It is one of the leading private sector commercial banks in Bangladesh. The bank has already shown a tremendous growth in the profits and fastens sector. NCC stick has provided its banking service with a top leadership and management position. NCC empennaget Limited has already achieved a high growth rate accompanied by an impressive profit growth rate in 2001. The anatomy of nonpluss and the loans and toss aways are also increasing rapidly. NCC slang has an interactive corporate culture. The working environment is very friendly, interactive and informal. And, there are no inexplicable barriers or boundaries darn communicate between the superior and the employees. This corporate culture provides as a great motivation factor among the employees. NCC vernacular has the reputation of macrocosm the supplier of good quality services too its, potential customers. Weaknesses The main of the essence(p) thing is that the bank has no clear missionary post statement and strategic plan. The bank doesnt aim any long- bound strategies of whether it wants to focus on retail banking or manufacture a corporate bank. The path of the future should be de bournined now with a strong feasible strategic plan. The bank failed to provide a strong quality-recruitment policy in the lower and some middle level position. As a result the services of the bank seem to be Deus in the present days. _The poor service quality has become a major problem for the bank. The quality of the service at NCC bank depository financial institution is higher than the Dhaka Bank, NCC avow or Dutch Bangla Bank and so forth But the bank has to compete with the transnational Bank located here. Some of the job in NCC coast has no growth or advancement path. So neglect of motivation exists in persons filling those positions. This is a weakness of NCC BANK that it is having a convocation of unsatisfied employees. __In ha rm of promotional sector, NCC BANK has to more emphasize on that. They ready to follow aggressive get bying campaign. _The non retri merelyion take a chances of all term loans have to be minimized in order to sustain in the financial market. Because of default risk the organization may become bankrupt. NCC BANK has to remain vigilant about this problem so that proactive strategies are interpreted to minimize this problem if not eliminate. Opportunities In order to reduce the business risk, NCC BANK has to expand their business portfolio. The management can consider options of starting merchant banking or diversify into leasing and insurance sector. The activity in the secondary financial market has direct impact on the primary financial market.Banks operate in the primary financial market. Investment in the secondary market governs the national economic activity. Activity in the national economy controls the business of the bank. opportunity in retail banking lies in the fa ct that the terra firmas increased universe of discourse is gradually learning to adopt consumer finance. The legal age of our population is middle class. Different parts of retail change products have great challenge to this class. So a wide descriptor of retail modify products has a very coarse and easily pregnable market. A large number of private banks coming into the market in the recent time.In this free-enterprise(a) environment NCC BANK must expand its product line to enhance its sustainable competitive advantage. In that product line, they can submit the ATM to compete with the local and the contrasted bank. They can familiarise credit post horse and report card card system for their potential customer. In addition of those things, NCC BANK can introduce special corporate design for the corporate customer or officer who have an income level higher from the service holder. At the homogeneous time, they can introduce scheme or loan for several(a) service holders.And the scheme should be sort out according to the professions, much(prenominal) as engineers, lawyers, doctors. Threats tout ensemble sustaining multinational banks and upcoming foreign and private banks pose significant threats to NCC BANK Limited. If that happens the loudness of competition go out rise besides and banks ordain have to develop strategies to compete against these local and foreign banks. Other commercial banks are offering higher allowance that may create problem for NCCBL to retain their experienced managers and executives. ? MAJOR PRODUCTS OF NCC BANK LTD. 3. 0 PRODUCTS OF NCC BANKBefore discussion about products of NCC Bank, we have to beneathstand what banks products are. Bank is a service orient industry and deals with non-homogeneous financial products and services for financial gains. fiscal products and services products that a bank offers to its customers are mainly classified ad as under a) mystify Products to generate gold. b) change products for financial gains c) capital Transmission products d) worldwide business products e)Special tip off earning service3s f)social services products Products that are marketing by NCC Bank are as under 3. 1. 1. fixate Products Deposit is the lifeblood of a bank. From the chronicle and origin of the banking system we know that deposit collection is the main start of a bank. Accepting deposits mathematical operations of collecting deposit physical process are almost same in the entire bank and the branches as well. The deposits that are swallow uped by NCC BANK like other banks may be classified into modish Deposit Short term deposit Saving Deposit unconquerable deposit Special Saving end Deposit (SSS) 3. 1. 2. alter Products Bank has its own principle about the credit basic or loan to the ustomers, besides bring product of a bank or of a branch is equal logical implicationant to verify the outstanding at the end of any fiscal year. Every bank pays special attent ion about their bestow products, because these products are handed over on a official basis. Continuous bestow a. Secured Overdraft against Financial Obligation turf (FO) Advances allowed to individual/ secures against financial obligation (i. e. lien of FDR/PSP/BSP/ restitution constitution etcetera ) and against assignment of plant life order for execution of begetual works attain under this head. It is a unbroken advance facility.By this agreement, the banker allows his customer to overdraft his current study up to his credit limits authorise by the bank. The hobby is institutionalised on the substance, which he with constructs, not on the encourageed come up. NCC BANK sanctions SOD against distinct security. b. Secured Overdraft against Work order/ existing Estate etc SOD (G) Advances allowed against assignment of work order or execution of contractual works pass aways under this head. This advance is abundantly allowed for a definite period and specific pu rpose i. e. it is not a continuous credit. It fall under the syndicate others. c. property Credit (Hypothecation)Advances allowed to individual /firm for transaction as well as sell purpose or to industries to meet up the working capital requirements against hypothecation of goods as primary security fall under this figure of lending. It is a continuous credit. It is allowed under the category (i) Commercial Lending when the customer is other than a industry and (ii) Working Capital when the customer is an industry. d. currency Credit (Pledge) Financial accommodations to individual / firm for trading as well as sole- transposition purpose or to industries as working capital against sureness of goods as primary security fall under this head on advance.It is also a continuous credit and like the above allowed under the categories (i) Commercial Lending and (ii) Working Capital. e. exportingationationationationation bullion Credit (ECC) Financial accommodation allowed to a party for export of goods falls under this head and is categorize as exportation Credit, The advances must be liquidated out of export event at bottom 180 days. necessitate contri just nowe beg give (Forced LIM, BLC, PAD, IBP etc). delinquent period pass on be fibed from the day by-line the date of expiry of such loan.? Less than 6 months ? 6 months or more but less than 9 months 9 months or more but less than 12 months ?More than 12 monthsUnclassified Sub-standard Doubtful Bad/loss 1% 20% 50% 100% a. give General Short term, Medium term &038 Long term loans allowed to individual /firm /industries for a specific purpose but for a definite period and broadly due by facilitys fall under this head . this type of lending are mainly allowed to accommodate financing under the category (a) Large &038 Medium master industry and (b) humiliated &038 Cottage labor . real term financing for (a) gardening &038 (b) Others are also included here . b. consider Loan Against Shi p breakingThis type of loans does not exercise in this branch, but being exercised to other branch that provide advances against ship breaking. c. salary Against Documents (PAD) tip off make the bank against lodgment of transportation records of goods swap through L. C. falls under this head. It is an stave advance connected with import and is broadly liquidated shortly against fees usually make by the party for retirement of the documents for lay off of merchandise goods from the customs authority. It falls under the category Commercial Lending . d. Loan against trade Merchandise (LIM)Advances allowed for retirement of shipping documents and release of goods import through L. C. taking effective control over the goods by cartel in brokerage can under banks lock &038 key fall under this type of advance. This is also a flitting advance connected with import which is cognize as post-import finance and falls under the category Commercial Lending. e, Loan against as sertion reception (LTR) Advance allowed for retirement of shipping documents and release of goods imported through L. C. without effective control over the goods delivered to the customer falls under this head.The goods are handed over to the importer under trust with the arrangement that sale bribe should be deposited to liquidate the advances at heart a prone period. This is also a brief advance connected with import and know as post-import finance and falls under the category Commercial Lending. g. Packing Credit Advance allowed to a party against specific L. C/firm contract for processing/ packing of goods to be exported falls under this head and is categorized as Packing Credit. The advances must be adjusted from proceeds of the relevant exports within 180 days. i. remote accusative Bills secured (FDBP)Payment make to a customer through bargain for/ duologue of a foreign infotainment levels falls under this head. This temporary advance is adjustable from the procee ds of the shipping/export documents. Its falls under the category trade Credit j. Local Documentary Bills Purchased (LDBP/IDBP) Payment made against documents representing sell of goods to local export oriented industries which are deemed as exports and which are denominated in Local currency/ foreign currency falls under this head. The carte du jour of alter is held as the primary security. This temporary liability is adjustable from the proceeds of the meridians. . feast Business Loan. This type of loan are broadly sanctioned depending on the occasion, more than two festival business loans are generally sanctioned in an annum. Term Loan a. Project Loan NCC BANK offers several(predicate) conventional credit/investment schemes and the Banking products to their customers. So far loans and advances portfolio includes Project pay in the form of Term Loan, original Estate pay, Secured Overdraft against FDR, different security credentials, working capital in the form of Cash C redit Hypothecation, logical implication Trade finance in the form of PAD/LIM/TR etc.NCC BANK considers the loans, which are sanctioned for more than one year as term loan. on a lower floor this facility, an enterprise is financed from the starting to its finishing, i. e. from installation to its doing b. Transportation Loan Considers the loans, which are sanctioned for the purpose of delivering the goods on to its final destination, its generally used in the form of interior exporting or anchor to tail letter of credit. c. reside Building Loan Loans allowed to individual/ enterprise construction of house (residential or commercial) fall under this of advance.The amount is repayable by monthly installment within a qualify period, advances are known as Loan (HBL GEN). d. Small Business Loan Short term and long term loans allowed to individual/ firms / industries for a specific purpose but a definite period and generally repayable by the installments fall under this head. Thes e types of lending are mainly allowed to accommodate financing under the categories. Small and Cottage Industries, Very often term financing for floriculture and others are also included here. e. Consumer Finance LoanNCCBL keeping in mind the economic development and helping the fixed income host in fulfilling their demand to upgrade the standard of living provide continue out front consumer finance scheme for Household appliances, furniture &038 Fixture, Air Conditioner, Fax Machine, motor oscillation/Car, Cellular phone, and Other equipment f. Lease Finance NCCBL to keep its contribution to the growth of national GDP, accelerate the total economic development by infusing the line in tillable sector in more effective and effective way diversity its portfolio and return the customers need would go for lease finance for Setting up of small and cottage industries/Projects, BMRE of existing leap outs Transports (roads/marine), Medical equipment/ surgical/clinical/lab equipmen t/x-ray shape etc, turn of events equipment and other fixed assets of other robust and service oriented ventures. g. person-to-person Loan To meet emergency financial requirement especially for medical handling/surgical operation, marriage, admission of children/ educational expenses, maternity the loan facility may be extended. 3. 1. 3. Money transmission Product Carrying cash specie is troublesome and risky.Thats why money can be transferred from one place to other(prenominal) through banking channel. This is called remandtal. Remittances of funds are one of the most important aspects of the Commercial Banks in rendering services to its customers. Payment order/security deposit pass along (PO/SDR) This term will be discussed in the overall activities section under remission of sin plane section. Demand indite (DD) This term will also been discussed in the overall activities section under remittance subdivision. Telegraphic conveyance of title (TT) This is also a comm on term that in the remittance section as well. . Travelers balk Travelers Cheque (TC)Issue of TCTC is useful to traveler abroad. Customers can encash the TC in abroad from the d peeledee bank. TC is utility(a) to holding cash and it provides better security than holding cash in hand. acquire Of TCIf any unused leaf of TC is surrendered bank spoils it from the customer. All wagess are made in local currency. Banks generally buy only those TC. 3. 1. 4. International Business Products In banks when we talk of global business products, we disturb to the general mechanism by which a bank converts currency of one democracy into that of another. alien tack Department (FED) is the international department by which a bank or an AD branch transects with other international bank or of a brach. Bangladesh Bank issues license to scheduled banks to deal with foreign exchange. These banks are known as Authorized Dealers. If the branch is important dealer in foreign exchange market, it c an remit foreign exchange from local rural area to foreign countries by transacting their international business products. So NCC BANK, headliner branch is an authorised dealer. Letter of Credit (L/C) linchpin to venture Letter of credit (BTB L/C) purchasing and selling of foreign exchange abroad demand draft (FDD) external Demand DraftBank issue Demand Draft in favor of purchaser or any other according to didactics of purchaser. The payee can collect it for the drawee bank in which the humble bank of Demand Draft holds its NOSTRO Account. Bank also makes payment on DD drawn on this bank by its foreign correspondence bank through the VOSTRO Account. Foreign telegraphic transfer (FTT) Outward remittance covers gross revenue of foreign currency through take foreign T. T. Drafts, Travelers wear etc. as well as sell of foreign exchange underL/C and against import bills retired. 3. 1. 5. Special fee earning products NCC Bank considers the special earning product to the diffe rent consumer, as it to play a comprehensive role in financing the bank product. Among those pursuit are some issues relate to special fee earning product Bank ensure Foreign bank Guarantee (F. B/G) Underwriting brokerage House and locker suffice Issuances of Sanchaya Patra, yield Earners Development Bond, National Investment Bond, plunder Bond are some special earning fee product of NCC bank. 3. 1. 6. Social Service ProductsNCC Bank Considers several service products by looking at the social caput of view, At this competitive edge, banking might have reached to preserve its market share and to move into new market share through diversification of its product range. Following are the services that are de sign-language(a) to provide for society Sale of Lottery Tickets for collection of fund for social establishment order of Zakat Fund army of Haj Deposit 3. 2 CREDIT POLICY &038 CREDIT OPERATION OF NCCBL Credit policy is a guideline of a financial institution to determine- W ho shall get credit (eligibility to get loan) How much to lend (Amount of lending) Why to lend (Purpose of lending) Where to finance (Portfolio Management depending upon profitability and requirement for companionship on socio economic benefits) Credit contribution of a bank especially acts as a key financial machine to haunt for earning revenue of a bank to achie3ve its ultimate goal for profut maximization with minimum risk maintaining balanced portfolio management. 3. 3 WHERE TO pay (FINANCING ACTIVITIES OF NCC BANK) Financial activities of a bank depend upon its portfolio management of its funds through deposit.Our lending policy would be within the broad policy frame work envisaged above. Banks lending activities may be classified into the pastime broad segments. 1. Trade and Commerce 2. Industries 3. Lease financial backing 4. Consumer Financing 5. Real Estate &038 Civil look 6. Agro based 7. Small Business Loans 8. Personal Loans 3. 4 Security Policies The term loans, if any extended by the bank shall gave to be secured by first target mortgage on the fixed asset insurance coverage leaving a margin of at leas 25% depending upon the viability of the project.Consideration in this regard will vest stringently on viability criteria disregarding of bank client-relationship. The determinants in this respect are debt service coverage, debt-equity ratio, and fixed coverage to term loan with a margin of 25-30% minimum. The working capital may be additionally covered by world-class fritter mortgage of the fixed asset or by sharing first mortgage ranking PARIPASU with the financial institutions providing term loan. decisiveness is this regard shall be at the sole discretion of the bank. normal BANKING OF NCC BANK LTD. 4. 0 FUNCTIONS OF NCC BANK LIMITED 4. 1 GENERAL BANKINGGeneral banking department is the heart of all banking activities. This is the busiest and important department of a branch, because funds are mobilized, cash proceeding are made modify, remittance and accounting activities are do here. Since bank is confined to provide the services everyday, general banking is also known as retail banking. In NCC BANK LTD pass Branch, the following departments are under general banking section A)Account brusking section B)Deposit Section C)Cash Section B)Remittance section C) elucidation section D)Accounts section 4. 1. 1 A) ACCOUNT OPENING SECTIONAccount wantoning is the gateway for clients to enter into business with bank. It is the fanny of banker customer relationship. This is one of the most important sections of a branch, because by opening accounts bank mobilizes funds for investment. Various rules and regulations are maintained and divers(a) documents are taken while opening an account. A customer can open different types of accounts through this department. much(prenominal) as 1. Current Deposit. 2. nest egg account. 3. Short notice deposit (SND) Types of Accounts with Terms and Conditions Current Deposit C urrent account is purely a demand deposit account.thither is no barrier on withdrawing money from the account. It is essentially justified when funds are to be collected and money is to be paid at frequent interval. Some important points have been discussed in the project part. Savings Bank Account This deposit is in the beginning for small-scale savers. Hence, there is a restriction on withdrawals in a month. tough withdrawals are permitted only against precedent notice. Some importingant Points have been discussed in project part. SND (Short Notice Deposit) Account ordinarily various big companies, organizations, disposal Departments keep money in STD account.Frequent withdrawal is discouraged and requires prior notice. The deposit should be kept for at least seven days to get interest. The interest offered for STD is less than that of savings deposit. enkindle is calculated based on routine minimum product and paid two times in a year. provoke rate is 6. 00%. Table-01 Account open up mathematical process rate 1The account should be mightily introduced by Any one of the following ? An existing Current Account holder of the Bank. ?Officials of the Bank not below the rank of an Assistant officer. ?A respectable person of the locality well known to the Manager/Sub-Manager of he Branch come to. note 2Receiving change up act in banks prescribed form mentioning what type of account is desired to be opened quantity 3? The form is fill up by the applicant himself / herself ? deuce copies of passport size photographs from individual are taken, in consequence of firms photographs of all partners are taken ? Applicants must submit requisite documents ?Application must sign exemplification signature planing machine and give enactment ? Introducers signature and accounts number substantiate by legal officer step 4Authorized Officer accepts the exertionStep 5Minimum balance is deposited only cash is accepted Step 6Account is opened and a Che ques book and pay-in-slip book is minded(p) Documents needed for opening account ? Individual / crossroads Account 1. basis of the account. 2. Two photographs of the signatories punctually attested by the introducer. 3. Identity ( counterpart of passport). 4. articulatio Declaration solve (For joint a/c only). 5. Employees surety (in gaucherie of service holder). ? federation account 1. incoming of the account. 2. Two photographs of the signatories punctually attested by the introducer. 3.Partnership letter punctually signed by all partners (Sign should be similar as stated in Partnership Deed). 4. Partnership Deed duly cognizant by Notary public. 5. rescript (If any). 6. Updated Trade license. ? proprietorship account 1. insane asylum of the account. 2. Two photographs of the signatories duly attested by the introducer. 3. legal retroflex of Trade independence. 4. Rubber stamp. 5. TIN number award. 6. Identity (Copy of passport). 7. Permission letter from DC/ Magistrate (in nerve of newspaper) ? Limited company 1. Introduction of the account. 2.Two photographs of the signatories duly attested by the Introducer. 3. legitimate imitation of Trade License. 4. Board proclamation of opening A/C duly certified by the president/Managing Director. 5. certification of Incorporation. 6. certification of Commencement (In character of Public limited company). 7. Certified (joint stock) true written matter of the memorandarandum and Article of Association of the guild duly attested by Chairman or Managing Director. 8. List of directors along with engagement &038 specimen signature. 9. Latest certified copy of Form xii (to be certified by register of joint stock companies) (In case of Directorship change). 0. Rubber Stamp (Seal with grant of each person) 11. credentials of registration (In case of Insurance Company Obtained from department of Insurance from the Peoples Republic of BD). ? Club / societies account 1. Introduction of the ac count. 2. Two photographs of the Signatories duly attested by the introducer. 3. Board Resolution for origin A/C duly certified by President/ Secretary. 4. List of Existing Managing Committee. 5. Registration (if any). 6. Rubber Stamp. 7. Permission letter from function of N. G. O. (In case of N. G. O. A/C). Closing of an accountThe closing of an account may happen, ?If the customer is desirous to tightly fitting the account, ?If the NCC BANK brings that the account is inoperative for a long duration. ?If the court of NCC BANK issues dress order. A customer may close his/her account any time by submitting an application to the branch. The customer should be chooseed to draw the final check for the amount standing to the credit of his/her account less the amount of closing an other incidental charge and surrender the unused check leaves. The account should be calculateed for the account closing charge etc. nd the authorized officer of the bank should destroy unused check. In c ase of joint account the application for closing the account should be signed by the joint account holder. The fee for closing of an account is Tk. 50. 4. 1. 2 B) local anesthetic REMITTANCE Carrying cash money is troublesome and risky. Thats why money can be transferred from one place to another through banking channel. This is called remittance. Remittances of funds are one of the most important aspects of the Commercial Banks in rendering services to its customers. Types of remittance ? betwixt banks and non banks customer Between banks in the same earth ?Between banks in the different centers. ?Between banks and central bank in the same country ?Between central bank of different customers. The main instruments used by the NCC BANK of remittance of funds are ?Payment order (PO) ?Demand Draft (DD) ?Telegraphic Transfer (TT) So the basic three types of local remittances are discussed below Table- 02 PointsPay OrderDemand DraftTT ExplanationPay Order gives the payee the right to p ostulate payment from the effect bankDemand Draft is an order of issuing bank on another branch of the same bank to pay specified sum of money to payee on demand.Issuing branch petitions another branch to pay specified money to the specific payee on demand by Telegraph / border Payment fromPayment from issuing branch onlyPayment from legitimate branch Payment from ordered branch by and large used to Remit fund Within the elucidationhouse area of issuing branch. extracurricular the clearinghouse area of issuing branch. Payee can also be the purchaser. Anywhere in the country Payment Process of the paying bankPayment is made through clearing 1. Confirm that the DD is not forged one. 2. Confirm with sent advice 3. Check the Test Code 4. mention payment1.Confirm issuing branch 2. Confirm Payee A/C 3. Confirm amount 4. Make payment 5. Receive advice Charge Only commissionCommission + telex machine chargeCommission + Telephone Term Deposit pass The Local Remittance section of NCC BANK Motijheel Branch also issues TDR. They are also known as time deposit or time liabilities. These are deposits, which are made with the bank for a fixed period, specified in advance. The bank need not maintain cash reserves against these deposits and therefore, the bank offers higher of interest on such deposits. Term Deposits These rates are not negotiable.In this table we can find out the percentage that is addicted by the bank for specific period of time to the customer. 4. 1. 3 CLEARING SECTION The amount of Cheques, Pay Order (P. O), and Demand Draft (D. D) assembly from other banks on behalf of its customer is a basic function of a clearing Department. Clearing Clearing is a system by which a bank can collect customers fund from one bank to another through clearing house. Clearing House Clearing House is a place where the representatives of different banks get together to meet and deliver Cheques with another banks. Normally, Bangladesh Bank performs the Clearing House in Dhaka, Chittagong, Rajshahi, Khulna &038 Bogra. Where there is no branch of Bangladesh Bank, Sonali bank arranges this function. Member of Clearing House NCC BANK limited is a scheduled Bank. correspond to the Article 37(2) of Bangladesh Bank Order, 1972, the banks which are the member of the clearinghouse are called as Scheduled Banks. The scheduled banks clear the check drawn upon one another through the clearinghouse. Types of ClearingA)Outward Clearing When the Branches of a Bank receive look intos from its customers drawn on the other Banks within the local clearing zone for collection through Clearing House, it is Outward Clearing. B)Inward Clearing When the Banks receive draw off drawn on them from other Banks in the Clearing House, it is Inward Clearing. Who will deposit check out for Clearing Only the regular customers i. e. who have Savings, Current, STD &038 Loan Account in the bank can deposit tick for collection of fund through clearing house. Responsibility of the botherationed officer for the Clearing Cheque and being work with department, following are the issues )Crossing of the cheque. 2)(Computer) post horse of the cheque. 3)Clearing lettre de cachet &038 proper endorsement of the cheque. 4)Separation of cheque from deposit slip. 5)Sorting of cheque 1st bank wise and then on branch wise. 6)Computer print 1st branch wise &038 then bank wise. 7)Preparation of 1st Clearing House computing machine validation sheet. 8)Examine computer validation sheet with the deposit slip to justify the computer posting 9) Copy of computer posting in the floppy disk. Bills Collection In modern banking the mechanism has become multifactorial as far as silent transaction and safety is concerned.Customer does pay and receive bill from their counterpart as a result of transaction. Commercial banks duty is to collect bills on behalf of their customer. Types of Bills for Collection i. Outward Bills for Collection (OBC). ii. Inward Bills for Collection ( IBC). What is OBC? OBC means Outward Bills for Collection . OBC exists with different branches of different banks outside the local clearinghouse. Normally two types of OBC 1)OBC with different branches of other banks 2)OBC with different branches of the same bank Procedure of OBC 1)Entry in the OBC register. 2)Put OBC number in the cheque. ) Crossing seal on the left corner of the cheque &038 payees account will be impute on actualization seal on the back of the cheque with signature of the concerned officer. 4)Dispatch the OBC cheque with forwarding. 5)Reserve the photocopy of the cheque, carbon copy of the forwarding and deposit slip of the cheque in the OBC file. Inward bills for collection (IBC) When the banks collect bills as an agent of the collecting branch, the system is known as IBC. In this case the bank will work as an agent of the collection bank. The branch receives a forwarding letter and the bill. Procedure of IBC 1.IBC against OBC To receive the OBC cheque first we have to give entry in the IBC Register . The IBC number should put on the forwarding of the OBC with date. 2. Deposit of OBC amount OBC cheque amount is put into the sundry deposit-sundry Creditors account, define debit &038 credit voucher of it. If the OBC cheque is honor, set credit advice (IBCA) with signature &038 advice number of the concern branch for the OBC amount. 3. If the OBC cheque is dishonored, the concerned branch is informed about it. 4. Again place in the clearing house or send the OBC cheque with Return Memo to the issuing branch according to their information. . 1. 4 D) ACCOUNTS SECTION Accounts Department is called as the organization Centre of the bank. In banking business, proceedings are done every day and these transactions are to be recorded in good order and systematically as the banks deal with the depositors money. . incorrect recording of transactions will lead to the mismatch in the debit side and in the credit side. To avoid these mishaps, the b ank provides a separate department whose function is to check the mistakes in passing vouchers or wrong entries or fraud or forgery.This department is called as Accounts Department. If any divergence arises regarding any transaction this department report to the concerned department. Besides these, the branch has to prepare some internal statements as well as some statutory statements, which are to be submitted to the Central Bank and the capitulum Office. This department prepares all these statements. Workings of this department Packing of the correct vouchers according to the debit voucher and the credit voucher put down the transactions in the cashbook. Recording the transactions in general and subsidiary record Preparing the daily position of the branch comprising of deposit and cash Preparing the daily Statement of personal business showing all the assets and liability of the branch as per General Ledger and underling Ledger separately Making payment of all the expenses of the branch Recording inters branch fund transfer and providing accounting treatment in this regard. Preparing the monthly salary statements for the employees Preparing the hebdomadally position for the branch which is sent to the Head Office to maintain Cash Reserve Requirement (C.R. R) Preparing the monthly position for the branch which is sent to the Head Office to maintain Statutory Liquidity Requirement (S. L. R) Make charges for different types of duties Preparing the budget for the branch by fixing the target regarding profit and deposit so as to take prerequisite steps to generate and mobilize deposit. Checking of dealings List Recording of the vouchers in the verifier Register 4. 2 E. FOREIGN transposition Foreign exchange is the means and methods by which rights to wealth in a countrys currency are reborn into rights to wealth in another countrys currency.In banks when we talk of foreign exchange, we intimate to the general mechanism by which a bank converts curre ncy of one country into that of another. Foreign Exchange Department (FED) is the international department Bangladesh Bank issues license to scheduled banks to deal with foreign exchange. These banks are known as Authorized Dealers. If the branch is authorized dealer in foreign exchange market, it can remit foreign exchange from local country to foreign countries. So NCC BANK, Principal branch is an authorized dealer. There are three kinds of foreign exchange transactionA) present moment B)exportation C)Remittance. 4. 2. 1 A) extremely low frequencyORT To import, a person should be competent to be an importer. According to Import and merchandise subdue Act, 1950, the Office of Chief controller of Import and export provides the registration (IRC) to the importer. In an international business environment, buyers and sellers are generally unappreciated to each other. So seller of goods forever and a day seeks security for the payment of his exported goods. Bank gives export guar antee that it will pay for the goods on behalf of the buyer if the buyer does not pay. This guarantee is called Letter of Credit.Thus the contract between importer and exporter is given a legal shape by the banker by Letter of Credit. 4. 2. 1. 1Letter of Credit Definition A letter of credit is a letter issued by a bank (know as the opening or the issuing bank) at the instance of its customer (known as the waster) addressed to a person ( benefactive role) childbed that the bills drawn by the beneficiary will be duly honored by it (opening bank) provided certain conformations mentioned in the letter gave been complied with. Table- 03 ImporterWho applies for L/C Issuing BankIt is the bank which opens/issues a L/C on behalf of the importer. corroborative Bank It is the bank, which adds its confirmation to the credit and it, is done at the request of issuing bank. Confirming bank may or may not be advising bank. Advising or Notifying Bank It is the bank through which the L/C is advi sed to the exporters. This bank is actually find in exporters country. It may also assume the role of affirm and / or negotiating bank depending upon the condition of the credit. Negotiating Bank It is the bank, which negotiates the bill and pays the amount of the beneficiary. The advising bank and the negotiating bank may or may not be the same.Sometimes it can also be confirming bank. Accepting BankIt is the bank on which the bill will be drawn (as per condition of the credit). Usually it is the issuing bank. Reimbursing BankIt is the bank, which would reimburse the negotiating bank after get payment operating get wordions from issuing bank. 4. 2. 1. 3 Steps for import L/C Operation 8 steps operation Step 1 Registration with CCI&038E For engaging in international trade, every trader must be first registered with the Chief mastery of Import and Export. By paying specified registration fees to the CCI&038E. he trader will get IRC/ERC (Import/Export Registration Certificate) , to open L/C with bank, this IRC is must. Step 2 Determination harm of credit The terms of the letter of credit are depending upon the contract between the importer and exporter. The terms of the credit set forth the amount of credit, wee-wee and address of the beneficiary and opener, tenor of the bill of exchange, period and mode of freight and of destination, nature of credit, expiry date, name and number of sets of shipping documents etc. Step 3 Proposal for Opening of L/C To have an import LC limit an importer submits an application to department to NCC BANK.The proposal contains the following particulars Full particulars of the bank account Nature of business call for amount of limit Payment terms and conditions Goods to be imported Offered security Repayment schedule Step 4 Application by importer to the banker to open letter of credit For opening L/C, the importer is postulate to fill up a prescribed application form provided by the banker along with the following d ocuments Table- 04 1. L/C Application form 7. Authority to debit account 2. Filled up LCA form 8. Filled up amendment request Form 3. Demand Promissory Note 9. IMP form 4. ro-forma invoice 10. Insurance cover note and money pass. 5. Tax naming number 11. Membership certificate 6. Import registration certificate 12. Rate version undertaking Step 5 Opening of L/C by the bank for the opener Taking filled up application form from the importer. Collects credit report of exporter from exporters country through his foreign correspondence there. Opening bank then issues credit by air turn on/TELEX/SWIFT followed by L/C advice as asked by the opener through his foreign correspondent or branch as the case may be, at the place of beneficiary.The advising bank advises the L/C to the beneficiary on his own form where it is addressed to him or yet hand over the original L/C to the beneficiary if it is so addressed. Step 6 Shipment of goods and lodgment of documents by exporter Then exporte r ships the goods to the destination of the importer country. Sends the documents to the L/C opening bank through his negotiating bank. Generally the following documents are sent to the Opening Banker with L/C Table- 05 1. Bill of Exchange 6. Packing List 2. Bill of incubus 7. Advice Details of Shipment 3. Commercial measure 8. Pre-shipment Inspection Certificate . Certificate of Origin 9. Vessel Particular 5. A certificate stating that each packet contains the description of goods over the packet. 10. Shipment Certificate Step 7 Lodgment of Documents by the opening Bank from the negotiating bank After receiving the documents, the opening banker scrutinizes the documents. If any discrepancy found, it informs the importer. If importer accepts the fault, then opening bankers call importer retiring the document. At this time many thing can happen. These are indicated in the following form found but the importer accepts no problem occurs in lodgment. Discrepancy found and importer not agreed to accept In this case, importer protest and send back all the documents to the exporter and request his to make in the specified manner. Here banker is not bound to pay because the documents send by exporter is not in accordance with the terms of L/C. Documents are OK but importer is unstrained to retire the documents In this case bank is obligated to pay the price of exported goods. Since importer did not pay for bill of exchange, this payment by bank is one kind of credit to the importer and this credit in banking is known as PAD. Everything is O. K. but importer fails to clear goods from the port and request bank to clear In this case banks clear the goods and takes delivery of the same by paying customs duty and sales tax etc. So, this expenditure is debited to the importers account and in banking it is called LIM. Step 8 Retirement The importer receives the intimation and gives necessary instruction to the bank for retirement of the import bills or for the disp osal of the shipping document to clear the imported goods from the customs authority.The importer may instruct the bank to retire the documents by debiting his account with the bank or may ask for LTR (Loan against swear Receipt). 4. 2. 1. 4 Accounting Procedure in case of L/C Opening When the officer thinks fit the application to open a L/C, boastful the following entries- creates the following charges- Table- 06 ParticularsDebit/ CreditCharges in Taka Customers A/CDebit L/C Margin A/CCredit Commission A/C on L/CCredit50% VATCredit15% on commission SWIFT ChargeCredit3000/= DatamaxCredit1000/= StampCredit150/= PostageCredit300/= DHL/CourierCredit1500 4. 2. 1. Amendment of L/C After opening of L/C some times alteration to the original terms and conditions become necessary. These amendments collect changes in a. Unit price b. offstage of validity o the L/C c. Documentary requirements etc. Such amendments can be affected only if all the concerned parties agree i. e. the beneficia ry, the importer, the issuing bank and the advising bank. For any amendment the importer must request the issuing bank in writing duly supported by revised indention/ Proforma invoice. The issuing bank then advises the needed amendment to the advising bank.L/C amendment commission including postage is charged to the clients A/C. 4. 2. 1. 6 Loan against pull communicate (LTR) Advance against a Trust Receipt obtained from the Customers are allowed to only first class tested parties when the documents covering an import shipment or other goods pledged to the Bank as security are given without payment. However, for such advances prior permission/sanction from Head Office must be obtained. The customer holds the goods or their sale-proceeds in trust for the Bank, till such time, the loan allowed against the Trust Receipts is fully paid off. The Trust Receipt is a document that creates the Bankers lien on the goods and practically amounts to hypothecation of the proceeds of sale in discharge of the lien. 4. 2. 1. 7Loan Against merchandise Merchandise (LIM) Advance (Loan) against the security of merchandise imported through the Bank may be allowed either on pledge or hypothecation of goods, retaining margin prescribed on their Landed Cost, depending on their categories and Credit obstacle imposed by the Bangladesh Bank. Bank shall also obtain a letter of undertaking and indemnity from the parties, forward getting the goods change through LIM Account. 4. 2. 1. Payment Procedure of Import Documents This is the most sensitive task of the Import Department. The officials have to be very much alert while making payment. This task constitutes the following Date of Payment Usually payment is made within seven days after the documents have been received. If the payment is become deferred, the negotiating bank may claim interest for making delay. Preparing Sale Memo A sale memo is made at B. C rate to the customer. As the T. T &038 O. D rate is paid to the ID, t he going away between these two rates is exchange trading. Finally, an Inter Branch Exchange duty Credit Advice is sent to ID. Requisition for the Foreign Currency For arranging necessary fund for payment, a requisition is sent to the International Department. Transmission of Message Message is transfer to the correspondent bank ensuring that payment is being made. 4. 3. 2 B) EXPORT 4. 3. 2. 1Understanding The goods and services exchange by Bangladesh to foreign households, businessmen and Government are called export. The export trade of the country is regulated by the Imports and Exports (control) Act, 1950. There are a number of formalness, which an exporter has to fulfill before and after shipment of goods.The exports from Bangladesh are subject to export trade control exercised by the Ministry Of Commerce through Chief Controller of Imports and Exports (CCI &038 E). No exporter is allowed to export any good permissible for export from Bangladesh unless he is registered wit h CCI &038 E and holds valid Export Registration Certificate (ERC). The ERC is required to be renewed every year. The ERC number is to be incorporated on EXP forms and other documents connected with exports. 4. 3. 2. 2 The formalities and procedure of Export L/C 1. Obtaining exports LC To get export LC form exporter issued by the importer. . Submission of export documents Exporter has to submit all necessary documents to the collecting bank after shipping of goods 3. Checking of export documents After getting the documents banker used to check the documents as per LC terms 4. talks of export documents If the bank accepts the document and pays the value draft to the exporter and forward the document to issuing bank that is called a negotiating bank. If the bank does buy the LC then the bank ordinarily acts as collecting bank. 5. Realization of proceeds This is the period when the issuing bank has realized the payment. 6.Reporting to the Bangladesh bank As per instruction by Banglad esh bank the bank has to report to respective(prenominal) department of Bangladesh bank by mentioning latest payment. 7. Issue to proceeds realization certificate (PRC) Bank has to issue proceed realization certificate of export LC to the supplier / exporter for getting cash assistance 4. 3. 2. 4Back-To-Back L/C It is simply issued to the clients against an import L/C. straight mechanism involves two separate L/C. One is master Export L/C and another is Back-to-Back L/C. On the strength of outgo Export L/C bank issues bank to Back L/C.Back-to-Back L/C is commonly known as buy L/C. On the contrary, Master Export L/C is known as Selling L/C. 4. 3. 2. 5 Features of Back to Back L/C An Import L/C to procure goods /raw materials for further processing. It is opened based on Export L/C. It is a kind of Export Finance. Export L/C is at Sight but back to Back L/C is at Usance. No margin is required to open Back to back L/C Application is registered with CCI&038E Applicant has bonded war ehouse license. L/C value shall not exceed the admissible percentage of net FOB value of relative Master L/C. Usance period will be up to 180 days. The import L/C is opened for 75% of the value of Export L/C. Here L/C issued against the lien of export L/C. Arrangements are such that export L/C matures first then out of this export profit, import L/C is paid out. 3. 3. 2. 6 Documents Required for Opening a Back-to-back L/C In NCC BANK Principal Branch, following papers/ documents are required for opening a back-to-back L/C- 1. Master L/C 2. Valid Import Registration Certificate (IRC) and Export Registration Certificate (ERC) 3. L/C Application and LCAF duly filled in and signed 4. Proforma Invoice or roughness 5.Insurance Cover Note with money receipt 6. IMP Form duly signed In addition to the above documents, the followings are also required to export oriented garment industries while requesting for opening a back-to-back L/C 1. textile Permission 2. Valid Bonded Warehouse Licen se 3. Quota Allocation Letter issued by the Export Promotion Bureau (EPB) in favor of the applicant for quota items. Payment of back to back l/c In case back to back as 60-90-120-180 days of maturity period, deferred payment is made. Payment is given after realizing export proceeds from the L/C issuing bank. 4. 3. 2. Negotiation of Export Documents Negotiation stands for payment of value to the exporter against the documents stipulated in the LC. If documents are in order, NCC BANK purchases (negotiates) the same on the basis of banker- customer relationship. This is known as Foreign Documentary Bill Purchase (FDBP). If the bank is not satisfied with the documents submitted to NCC BANK gives the exporter reasonable time to remove the discrepancies or sends the documents to L/C opening bank for collection. This is known as Foreign Documentary Bill for Collection (FDBC) entered into the Foreign bill Purchased (F.B. P) register. The documents are sent to the L/C opening Presentation of export documents for negotiation/Purchase After shipment, exporter submits the following documents to NCC BANK for negotiation. Bill of exchange Bill of warhead Invoice Insurance Policy/Certificate Certificate of Origin Inspection Certificate Consular Invoice Packing List