Conformity of Human Resource Management Practices of
Mercantile Bank Limited with Legal Environment of Bangladesh.
AN OVERVIEW OF MERCANTILE BANK LIMITED
Mercantile Bank Limited was incorporated in Bangladesh on May 20, 1999 as a scheduled bank in the private sector. The bank went into commercial banking operation since June 02, 1999. The first branch was opened at Dilkusha Commercial area in Dhaka on the same day. 2.
Nature of Company and Ownership Structure.
Mercantile Bank is a public limited company incorporated under the Bank Companies Act 1991 and the Companies Act 1994. 3.
The organizational structure and corporate governance of Mercantile Bank Limited strongly reflect its determination to establish, uphold and gain a stronger footing as an organization, which is customer-oriented and transparent in its management. [pic]
HRM PRACTICES AT MERCANTILE BANK LIMITED
HRM PHILOSOPHY OF MERCANTILE BANK LIMITED
The Mercantile Bank management is well aware of the need for human resource training and development. This can be understood from its corporate manual: “Function of the management of the bank is not only to cope with the situation prevailing but also to ensure best of services to the clientele and society at large as well as profitable returns to the owners and shareholders. These objectives may be fulfilled only when enlightened management coexists with skilled and motivated members of staff. Different levels of employees require different skills. An organization with people having technical, human and conceptual skills can serve and cope with the fast changing environment. Some of the traits and skills may be inborn in human beings. But most of the skills can be acquired and cultivated provided that there is willingness on the part of the employees and there is an organized effort for planned change in management and organizational development.”
HRM DEPARTMENTS AT MERCANTILE BANK LIMITED
In an effort to develop its human resources, the bank has set up a separate department- Human Resource Development and Research Division (HRD&R Division) in its corporate head office.
HRM FUNCTION- ACQUISITION OF HUMAN RESOURCE
Mercantile Bank Limited was set up initially by hiring bankers directly from different public and private banks. Later on, the organization developed its own human resource acquisition system. At present the HRD&R Division is responsible for the acquisition of human resource for the organization. The acquisition process is discussed below: 1.
The Bank recruits its employees from external sources. Normally it does not adopt internal search for incumbents except for promotion. For recruiting the Bank goes for advertising in the print media like the national dailies.
A Selection Committee is formed by the Board of Directors to select the competent applicants. The selection criteria and methods vary with the nature of jobs and job vacancies.
HRM FUNCTION- MOTIVATION AND COMPENSATION
Like any other organization, at Mercantile Bank Limited, a psychological contract exists between the employees and their organization. The organization desires that the employees will perform to their utmost for achieving the organizational goals. On the other hand, the employees also expect that the organization will reciprocate according to their performance. As such, the Bank has a well-defined system to compensate the outputs of the employees. The compensation system of Mercantile Bank Limited has the following dimensions: 1.
Base Wage and Salary System.
The Bank provides a multitude of benefits to its employees: a.
House-building Loan. The Bank has a provision of house-building loan for the employees at an interest rate, which is 1% more than the Bank’s prime rate. Employees can get this...
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