HABIB BANK LIMITED, DHAKA
“Feasibility Study of Consumer Lending
at Habib Bank Limited, Dhaka”
Institute of Business Administration
University of Dhaka
23 December 2004
December 23, 2004
Internship & Placement Office
Institute of Business Administration,
University of Dhaka.
Subject: Submission of the Internship Report
Please accept my Internship Report on “Feasibility Study of Consumer Lending at Habib Bank Limited, Dhaka”.
I hope that you find this report pleasing and that it meets your satisfaction. If you have any queries or clarifications, please contact me.
Sabina Rahman Khan
Roll : 73
Batch : 37D
I would like to thank Dr. Jahangir Alam, my faculty advisor, who has supported me, assisted me and guided me through this internship. He has been patient and understanding of all my queries and problems, and I am very grateful to him for his help.
I would also like to thank Mr. Abdul Hayee, Country Manager, Habib Bank Limited who had acted as my supervisor during the time of internship. He has been very helpful throughout this period.
Habib Bank Limited is a Pakistani international bank operating in Bangladesh. The bank is recognized as one of the leading financial institutions in South Asia, and a dynamic international bank in the emerging markets, providing customers with a premium set of innovative products and services. The bank has been in Bangladesh since 1976 and has two branches in Dhaka and Chittagong.
Habib Bank Limited has been providing services of only Commercial and Corporate Investment banking, aiming at serving the business-related part of the financial sector. However, the bank is now considering Consumer Lending.
The decision of whether or not Habib Bank Limited should go for Consumer Lending or not is discussed in this report. It is based on the existing business environment for consumer lending in Bangladesh, performance evaluation of the bank today and information about the consumer loan market.
The business environment in Bangladesh for consumer lending is steady and promising. The default culture and lacking of proper enforcement remains, but the growth of credit and private banks give signs of improvement and increase in demand.
The market findings derived from analyses done for this report show that most people prefer house-building consumer loans to others available in the market. Other findings include that interest rates, down payment and installation amounts are important factors that people look into before deciding which bank to do business with. Consumer banking services like online banking and ATM and phone banking are also services that the consumers of today demand.
Today Habib Bank Limited, Dhaka holds 0.2% of the market after almost three decades of business here. It runs at a shortfall in the minimum capital requirement with the Bangladesh Bank and has a capital of only Tk. 65 Crore. The bank needs market growth achieved via proper planning, aggressive marketing and diversification. The bank has strong brand identity internationally, and is operating profitably in Dhaka.
It is strongly felt that there is ample opportunity and market for a full-fledged consumer bank. HBL should enter this market by launching some popular consumer banking products and services, such as Car Loans or House-Building Loans as identified by the survey.
TABLE OF CONTENTS
2.1ORGANIZATIONAL MISSION & VALUES3