Credit Policy & Practices of Mercantile Bank Limited (Mbl)

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CHAPTER 1
‘Introduction’
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1.1 Introduction of the Study

In the era of trade liberalization, globalization has presented new challenges as well as greater opportunities for countries all over the world. Economic boundaries of nations are being abolished and the world is gradually becoming one global village. E-commerce is becoming the predominant mode of transactions. Revolutionary changes in the fields of cost control, retail channels, range and delivery of services, accessibility and reach are being witnessed. The incessant fall out of international credit market due to world economic meltdown resulting sluggish growth has put significant pressure on financial performance of banks and financial institutions worldwide. Despite this economic crisis, Mercantile Bank Limited (MBL) has achieved continuous growth in almost all arenas of its business, facing intensified competition of the industry. The bank (MBL) has remained in strong financial position with its continued focus on the vision of becoming the Bank of Choice by transforming the way it does business and developing a truly unique financial institution that delivers superior growth & financial performance and be the most Recognizable Brand in the financial services in Bangladesh.

Mercantile Bank Limited (MBL) aims at excellence and is committed to explore a new horizon of banking and private a wide range of quality products and services comparable with those available with any modern bank in the world. It is a bank for the common people including businessman and professionals. It intends to serve with quality at a price competitive to achieve in the financial market. It would constantly keep on exploring the needs of the clients. Mercantile Bank gives loan for the small and medium enterprises. MBL has introduced new schemes mostly for the business people in Bangladesh. MBL choose their clients very carefully by analyzing the Credit Worthiness of the borrowers. After openhanded the loan MBL always closely monitors the borrowers intends to reback the loan & supervises the Project Appraisals.

1.2 Statement of Research Problem

Credit may be the major important activities of commercial bank and it is also the main sources of revenue. Commercial Banks provides money to the deficit unit of the society who are in need of fund and by this activities bank can help in the economic development of as a whole. Credit or loan management of banking company is a very important activity & special emphasis is given on Credit administration & management in every type of bank. Commercial banks collect funds to provide both individual and corporate credit to the economy. For doing so a policy and guideline must be followed. Every bank has its own guideline regarding credit facilities given to the customers. And the officials and administrators are the follower of this guideline. This report is based on Credit policy and practices of Mercantile Bank Limited where I have tried to find the procedures and the guideline of Credit operations of Mercantile Bank Limited. The report consists of the rules and procedures of Credit facilities given to the customers by MBL, to whom the credit is given and how. Finally I have tried to find some recommendations to improve the credit operations of MBL.

1.3 Origin of the report

Management of any business of any business activity requires so much expertise from the part of its employees. To keep pace with the new trend financial institutions & other organization need executive with modern knowledge. The knowledge should have some practical experience also. To fulfill this required most of the faculty has been introduced a three month internship program as an indispensable part of BBA program. The authority of Daffodil International University authorizes me to do a practical orientation at Mercantile Bank Ltd. I have completed my three months practical orientation course...
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