" Causes of increasing Non-performing loan and its particular effects about Financial functionality at Financial institution Asia Limited. ” Internship Report
IDENTIFICATION: 082 020 030
Mr. Mohammad Hannan Miah
College of Business
North Southern University
Particular date: September 1, 2012
Traditionally the banking industry of Bangladesh got trouble with clients who does not pay back the financial loans. Years exceeded, rules created to protect banking companies from non-performing loans. But banks remain facing similar problem. nonperforming loan deprives banks of its well deserved profit that banks anticipate after disbursing the loan which has been arranged simply by persuading the depositors. nonperforming loan harms both financial institutions and depositors. Therefore , I have decided to carry out my intern research to find the reasons of arising nonperforming loan as well as its effects on the banks' financial performance. However , finding the issue is only fifty percent way towards the success. So , I have likewise decided to locate few likely solution of recovering nonperforming loans although my exploration. Since, I use done my internship in Bank Asia Ltd. for this reason I did my research on Bank Asia Ltd. My own report includes two parts. In part-1, I have tried to know Financial institution Asia as well as the banking sector, which will help to get the insight in understanding my research topic very well. What I have got learnt from investigating banks' financial info was economic performance of Bank Asia has been constant though it lost it is market share in the last year. The main issue that I found at Bank Asia was it has lack of persistence in distributing information coming from central office to braches that creates lack co-ordination. Another problem of Bank Asia is usually its' poor marketing coverage, they barely conduct virtually any commercial marketing of their services. In part-2 (project part) I have accumulated various data and conduct my study to find the effects. First of all defined my trouble and define areas to consider. Then I created my analysis hypothesis and my review questionnaire. I've selected three hypotheses upon three of my targets regarding non-performing loans, its effect on functionality, reasons and ways retrieve. The results that I have found was increase in nonperforming loan detrimentally affect the functionality of the lender, found factors (Sluggish girl after mortgage sanction, Feasibility analysis of loan proposal, Lack of monitoring loan sanction authority Fund diversion of borrowers) that are responsible for taking place non-performing financial loans and adjustments (risk analysis, investment collection, reinforcement to employees or assigning external recovery agency) needed to take up at Lender Asia to improve its' financial loan recovery. Depending on my findings I recommended Bank Asia to create a fresh section in loan recovery department (follow-up section), improve monitoring and evaluating loan sanction departments, arrange for schooling and performance added bonus for employees and conduct regular industry evaluation to create expenditure portfolio. Even though, I attempted my level best, constraints of time and reluctance of bank official to give secret information possess affected the reliability of my exploration. Therefore , I recommend that even more research will probably be required with increased resources for obtaining better solution of this very important topic.
Apart from the efforts of me, I want to accept the following people for their support and assistance with this internships report. The success of any project depends generally on the support and recommendations of many other folks. I take this opportunity to exhibit my honor to these individuals who have been a key component in the powerful completion of this project.
I would like showing my very best appreciation to Mr. Mohammad Hannan Miah (Lecturer, School of Business, North To the south University). His tremendous support and help helped me feel encouraged and encouraged every time I actually attend his meeting. With out his...
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