Chapter No. 1
Islam is the complete code of life. Islami Banking is the part of its economic financial system. Islamic Bank Bangladesh Ltd. (IBBL) has been playing a vital role without interest in the economic development of Bangladesh. This study aims to measures the growth & development of IBBL in respect measure the profit & profitability trend during the period of 1996-2007 i.e. 12 years. Net profit, total deposit, total investment, total assets, total fixed assets, total income, total expenditure, total equity, no. of employee & no. of branches were selected to measure the managerial effectiveness of IBBL during 1983-99. The IBBL offered to the client or encourage the investment which is suitable or profitable for the parties i.e bai –murabaha, bai-muajjal, bai-salam, bai-istisnah, hire purchase under shirkatul melk (HPSM), ijarah, mudaraba & musharaka. This study aims to implemented and being expanded to meet the specific and welfare oriented needs of the different segments of people of the country through the use of some investment strategy i.e. RDS, HDS, ISD, TIS, CIS, SBIS, MIIS, AIIS, HIS & REIP. The IBBL had the increasing trend in deposit, advances, total investment, net profit, branches & employees etc. So how far the policies of expansion were taken with the profit & profitability trend of this bank is yet to be investigated. The bank has been successful in attaining any of the targets during the period under study. This is the bank, which does not fail to attain the level of profit & profitability trend continuously during 1983-2007, as a private bank i.e. IBBL helps to the Govt. in respect financial & social welfare services. On the basis of above facts, the IBBL must be careful for the financial, economical & social development of Bangladesh through the more improvement of their profit & profitability trend of IBBL in Bangladesh. This will be more effective for the development of Bangladesh.
The traditional banking systems is fully based on interest banking systems indicating that operating efficiency of both banks & customers will revolve around fixed interest charges, only four nationalized commercial banks, twenty seven private commercial banks, thirteen foreign private banks & nine specialized commercial bank are functioning in Bangladesh including Islamic Bank Bangladesh Ltd.. All the banks are directly involved to charge the interest according to their banking design. But only one Islamic Bank Bangladesh Ltd. is an exceptional bank who does not apply any interest due to purely Islamic concept. The main objective of traditional banking is to earn profit by lending & borrowing money in exchange of interest with the unfair competition among the various bankers & customers. Before liberation, deposit collection was given priority over loan investment and ultimate aim was to earn profit through interest for the bank. But after liberation, the objectives of the banks were changed and diverted towards social & national development, increase of production, equitable distribution of wealth and income to ensure social justice and equality. The privatization of banks began in 1980s, then the permission was given to open new banks in the private sector. On the basis of the new change in policy, seven private commercial banks started their function including Islamic Bank Bangladesh Ltd. during 1982-83. Bangladesh has been pursuing privatization policy with the change in Govt. policy since 1975.
Islamic Bank Bangladesh Ltd. was established on 30th March 1983 as a multinational banking company. This bank is the first interest free scheduled bank in South- East Asia. The establishment of this bank has ushered a new era in Bangladesh. This bank is committed to help the people in pursuits of earnings and legal investments as allowed by the Islamic principles. Muslims Traders all of its activities are running as per Islamic Shariah. Some Religious, Industrialists and a few...
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