Even in depression our banks don't have losses!

Md Rezaul Karim By Md Rezaul Karim, 9th Mar 2014 | Follow this author | RSS Feed | Short URL http://nut.bz/1po0o43b/
Posted in Wikinut>Money>Saving

People might disagree or have reservation about my observations, but you can't deny the fishy tricks that the bankers do; inadvertently?- No way!

How to make profit in the banking sector!!


Making money is easy and smooth, no loss ever irrespective of macro economic conditions and competencies. No strategies required, no skilled and prudence matter in making profits in the banking sector. Technique of making money depends on how stupid the clients are!

This is manager’s economic responsibility to ensure good return on investment for the shareholders. The stakeholders’ demands among other elements are ethical practices and legal and sustainable running of business. The point of ethical aspects and moral grounds are very much shaky indeed with respect to the banking businesses in Bangladesh. This is no easy job while doing financing businesses all around the global business world. But this seems to be quite an easy mundane for Bankers in Bangladesh. Before turning to the point we must acknowledge various strategic approaches and techniques and marketing works before achieving its profit making objectives. But it seems in reality profiting from banking businesses is rather an easy pie.

Business managers do business by analyzing environmental factors and their strengths and weaknesses. The tension in the heads were mostly with relate to competitiveness and changing regulations and new emerging unknown situations. These forces sometimes made it compelling to revise the objectives and in adverse situations winding up of businesses. Most importantly all these forces made the banks and financial institutions to earn sometimes more and sometimes less, and sometimes even going down the red line. In Bangladesh we don’t see banks going down the red line, or even near to it, this is for guaranteed! Strange though, but fact is if anybody investigate and research the financial history of banks in Bangladesh, you will seldom find banks having incurred losses in their entire banking history! So efficient and effective one might think of! Are they such competent in reality? Public have doubts how even at the depressive mode of business cycle, banks are earning a lot more than average businesses!

The secret is- The clients of banks or say general public do not necessarily audit and check back what were not happening to their bank accounts, nor even question about how much interests they owe to clients and how much actually rewarded. Secondly, more importantly how much and what for the banks are debiting accounts by charging different named taxes, VATs, levies, and other service charges.

Public perception of how banks are making profit is as follows:
They do have projected income and profits at the beginning of their financial year, and accordingly they do try (!) or rather say, pretend to try to achieve the objectives, particularly the profit /earnings target. At the last month of reporting while they got it not achieving the goal, they start deducting the amount from their clients, naming eloquently various charges and sometime charging for what they even didn’t deliver!. Big clients do not have time to check back and monitor every move of the banks; and the banks do take full advantages of it. On the other side - Small clients do have small balances and amounts and charging fictitious and fabricated heads of accounts indeed disperse their faith and reliability of the banks, but have nothing to do but feeling sad inside and within. The following statement is a specimen copy of a client that depicts the issue vividly. Many codes and heads that deducted should not suppose to be as the case is for a corporate client. Again, what is the difference between corporate and normal ordinary clients? There must be some special treatment in terms of service and charges. In this case, it is not happening, rather every service which was not offered also charged.

For example this client did not have any ATM card, but charged; for couple of sending messages of withdrawing money. Interestingly clients do not asking for it; rather a Governmental compulsion on Banks, i.e., imposed as an obligatory job of private banks to inform clients about their cheque depositing and withdrawing transactions. By researching we also do not understand for what purposes the other charges are deducting. Most devastatingly, if someone deposited ten thousand taka in a bank in Bangladesh, and leave it for some years, the balance would be zero at some point in time, as the charges are debiting at regular interval, and which will of course be greater than the interest earning. The statement attached for more explanation and understanding of the matter. Poor Bangladeshi people!



Transaction Account Statement
Account Number: 000010002800
Currency: BDT
Branch: IBB O.R. Nizam
Statement for the period from 01 Dec, 2013 to 11 Feb, 2014:
Date Description Debit Credit Balance
Balance at period start : 238,640.69
01 Dec, 2013 VAT * CHG0637108438 75.00 238,565.69
01 Dec, 2013 ATM Charge Dr. * CHG0637108438 500.00 238,065.69
01 Dec, 2013 Inward Cheque - Dr * 1010228783 * FT1333500051 26,572.00 211,493.69
02 Dec, 2013 Inward Cheque - Dr * 1010228784 * FT1333600012\COX 30,029.00 181,464.69
02 Dec, 2013 Miscellaneous Credit * SALARY NOV 13 * DC133360001002104 51,000.00 232,464.69
11 Dec, 2013 VAT * CHG0637200136 75.00 232,389.69
11 Dec, 2013 SMS Charge Dr. * CHG0637200136 500.00 231,889.69
11 Dec, 2013 VAT * CHG0637201052 45.00 231,844.69
11 Dec, 2013 Service Charge Dr. * CHG0637201052 300.00 231,544.69
19 Dec, 2013 Transfer * UCBL-EFT * FT1335301412\MTJ 277.39 231,822.08
23 Dec, 2013 Excise Duty Dr. * CHG0637204328 350.00 231,472.08
30 Dec, 2013 Cr. Intt. or Prft. * 13421010002816-20131231 1,012.69 232,484.77
30 Dec, 2013 Income Tax * 13421010002816-20131231 101.27 232,383.50
01 Jan, 2014 Miscellaneous Credit * SALARY DEC 13 * DC140010001012008 49,500.00 281,883.50
02 Jan, 2014 Cheque Withdrawal * 1010228779 * TT1400200295 20,000.00 261,883.50
13 Jan, 2014 Inward Cheque - Dr * 1010228785 * FT1401300024 50,000.00 211,883.50
15 Jan, 2014 Inward Cheque - Dr * 1010228780 * FT1401500065 100,000.00 111,883.50
16 Jan, 2014 Transfer * DBBL-EFT * FT1401601836\MTJ 337.47 112,220.97
21 Jan, 2014 Cheque Withdrawal * 1010228786 * TT1402100167 25,000.00 87,220.97
23 Jan, 2014 Transfer * AFCAB RW 0739817 * FT1402215460\MTJ 5,000.00 92,220.97
23 Jan, 2014 VAT * CHG0637209479 6.00 92,214.97
23 Jan, 2014 Cheque Issued Commission Dr * CHG0637209479 40.00 92,174.97
26 Jan, 2014 VAT * CHG0640902742\MTJ 1.50 92,173.47
26 Jan, 2014 IPO Charge Dr. * CHG0640902742\MTJ 10.00 92,163.47
29 Jan, 2014 Miscellaneous Credit * SALARY JAN 14 * DC140290001002114 72,000.00 164,163.47
06 Feb, 2014 Cheque Withdrawal * 1011990221 * TT1403700076 30,000.00 134,163.47
Summary: 238,640.69 (-)283,604.77 (+)179,127.55 (=)134,163.47
ALTITUDE is developed and maintained by Information Technology Division, Prime Bank Limited © 2012 All rights reserved

Tags

Bangladesh, Banks, Corruption, Ethics, Finance, Misappropriation

Meet the author

author avatar Md Rezaul Karim
I am a teacher engaged with the Southern University Bangladesh. I Like to use my spare time by writing and reading. I take it as a fun and source of inspiration in pursuing knowledge.

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Comments

author avatar Delicia Powers
10th Mar 2014 (#)

Devastating to the individual...

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author avatar Md Rezaul Karim
13th Mar 2014 (#)

IF you are unluckily a huge deposit holder, I bet you would be a great looser..

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author avatar Md Rezaul Karim
19th Mar 2014 (#)

Indeed. Thank you very much.

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author avatar M G Singh
11th Mar 2014 (#)

nice post

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author avatar Md Rezaul Karim
13th Mar 2014 (#)

Thank you Madanji.

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author avatar Sivaramakrishnan A
16th Mar 2014 (#)

Thought provoking post and thanks for speaking out, Karim. I can vouch that banks are making money from the poor who needs an account while the rich will negotiate for nil charges. I have paid 4% for transfer of $1,000 while the wealthy transfer at better rates and negotiate for zero charges - siva

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author avatar Md Rezaul Karim
19th Mar 2014 (#)

Thank you very much Sivaji..

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author avatar madugundurukmini
23rd Mar 2014 (#)

banking business

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author avatar Md Rezaul Karim
23rd Mar 2014 (#)

Profiting on others pockets...! Thank you madu ji.

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author avatar Phyl Campbell
3rd Apr 2014 (#)

You are reporting on the situation in Bangladesh, but you might as well be reporting on the situation here. There are more indians than chiefs, more workers than bosses. Even our unions are corrupt or have corruption. It seems like the masses should be able to do something to take our countries back, but the masses cannot decide who to target to initiate the best fix. And I am just as clueless as the next person. Anyway, good share.

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author avatar Md Rezaul Karim
29th Aug 2015 (#)

Thank you Phyl.. but we are in an unbearable situation..

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author avatar Retired
27th Aug 2015 (#)

I don't like banks but have to use them

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author avatar Md Rezaul Karim
29th Aug 2015 (#)

Indeed we are all caught in the net..

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