Rupali Bank Limited (RBL) has made glorious achievements among the state owned commercial banks in Bangladesh over the period of last four years in all the indicators, overcoming a series of obstacles, said M. Farid Uddin, Managing Director, Rupali Bank Limited, in an exclusive interview with The Guardian.
In this context, the Managing Director informed us that among many of its achievements, remarkable profit, single digit classified loan, huge amount of cash recovery, notable development of human resource, completion of rapid computerization renovation, ATM services, developing risk based audit and inspection activities, remolding risk management activities and image building are worth mentioning.
The learned Managing Director further informed that during the period of global economic meltdown while other public and private sector banks had been going through a lot of negative indicators of their performances, Rupali Bank had done an excellent performance at that time; and for which the bank has won a good number of national and international awards in the last three years.
The Managing Director also mentioned that in close cooperation with the Board of Directors, Rupali Bank has undertaken visionary strategies to make it a ‘model bank’ among the public and private sector banks in Bangladesh. He also added that the strategies are already started to implement in short-term and mid-term basis to achieve the desired success as well as to attain the visionary goal of model bank soon.
He, in this context, informed that modern and time-befitting technologies are also being applied at all levels of structural and operational functions to ensure transparency and prompt services to the valued customers of the bank and necessary planning and policies are also adopted to make the process a success in true sense.
The Managing Directo pointed out that after long 22 years, the honorable shareholders already received 10 per cent stock dividend in 2010 and 20 percent stock dividend in 2011 and 10 percent stock dividend in 2012, and for 2013, 12.50 percent stock dividend has been recommended for the shareholders.
In an exclusive interview, Mr. Farid Uddin, a highly experienced Managing Director, replied to several questions, covering the entire activities, achievements, problems, potentials and future plans of Rupali Bank, including the different other issues of challenges and developments of the banking sector in Bangladesh. His deliberations are quite interesting, informative and educative as well. The excerpts of his valuable interview are presented here for The Guardian readers at home and abroad:
The Guardian: Please give us a short introduction to the founding history of Rupali Bank limited (RBL) through which it has come to its present position?
Managing Director: RBL emerged as a Nationalized Commercial Bank in 1972 by merging the then Muslim Commercial Bank, Australasia Bank, Standard Bank Ltd in pursuant to Bangladesh Bank Nationalization Order 1972 (PO No. 26 of 1972) as a ongoing concern through a vendor agreement signed between the MoF, People’s Republic of Bangladesh and the Board of Directors on behalf of Rupali Bank Limited. Rupali Bank Limited was incorporated as a Public Limited Company on 14 December 1986 under the Companies Act- 1913. Shares of the bank have been listed in the Dhaka Stock Exchange on 22-12-1987 and in the Chittagong Stock Exchange on 27-12-1995.
You know Rupali Bank had a glorious past as a state owned commercial bank since its establishment in 1972. But due to various crises created by the previous 4-party alliance government while planning to sell the bank to the private sector, creating a deadlock situation in the overall activities of bank including loan disbursement, deposit mobilization, profit earning, renovation activities, infra-structural development, automation set-up, recruitment and promotion, etc. As a result, the status and image of the bank fall down severely to the mass people .
The present Board, from the very beginning of taking over the responsibilities, has been trying its level best to restore the lost image and attain success at the shortest possible time. A big push was put into all the sector of activities to make the scenario changed in line with the spirit of the Board.
Accordingly, many area of activities have been reviewed radically, those include, rapid expansion of credit volume, deposit size, broader base of deposit accounts, restructuring of existing HR policy, recruitment of huge number of officers, engagement of expert consultant of different sector, renovation of the existing infrastructure, computerization and automation set-up, launching of different products, increasing of size of eligible capital including paid up capital, decreasing the amount of classified loan and increasing operating profit at a prestigious level are worth mentioning.
Today, Rupali Bank Limited has attained a glorious position when almost all the indicators like business, infrastructural development, renovation and modernization, computerization and IT, human resource development and last but not the least, image development is really praise-worthy.
The Guardian: Would you discuss the vision and mission of RBL on the basis of which the bank was founded?
Managing Director: Of course, our vision is to expand our loyal customer base by being known as the financial partner of choice that constantly exceeds customer expectations.
Our Mission is to
Develop long-term relationships that help our customers achieve financial success.
Offer rewarding career opportunities and cultivate staff commitments.
Uphold ethical values and meet its customer’s financial needs in the fastest and most appropriate way and continue innovative works in order to achieve human resource with superior qualities, technological infrastructure and service packages.
The Guardian: What are the core values of RBL?
Managing Director: Our core values are:
Social Responsibility – we care for and contribute to our communities.
Performance-we measure results and reward achievements.
Integrity-we uphold trustworthiness and business ethics.
Respect-we cherish every individual.
Innovation-we encourage creativity.
Teamwork – we work together to succeed.
The first letters of the initial words form “SPIRIT” and carry equal importance.
The Guardian: Would you discuss the strategic objectives of RBL and say how far the bank has been able to implement its strategic objectives?
Managing Director: We have certain strategic objectives. These are as follows:
Develop a customer oriented service culture with special emphasis to customer care and convenience.
Increase our market share by following a disciplined growth strategy.
Achieve a significant share of deposit and credits from the existing and niche markets.
Leverage our technology platform and pen scalable systems to achieve cost-effective operations, efficient MIS, improved delivery capability and high service standards.
Develop innovative products and services that attract our targeted customers and market segments.
Maintain a high quality assets portfolio to achieve strong and sustainable return and to continuously build shareholders’ value.
Explore new avenues for growth and profitability, particularly diversifying loan portfolio through structured finance and expansion of retail and SME financing. Strengthen the bank’s brand recognition
The Guardian: So far we came to know that RBL follows some ethical principles. Please discuss these principles.
Managing Director: Yes, we follow some certain ethical principles. These are:
Customer Focus and Fairness: At RBL, our prime focus is to achieve perfection in our customer service. Customers are our first priority and driving force. We wish to gain customer confidence and be their trusted partner. We believe in fair treatment to all customers, depositors, borrowers and clients without any discrimination.
Quality: Quality service experience is a paramount to our customers and we are strongly committed in fulfilling this ideal. We have a culture of timely compliance of regulatory requirements.
Honesty and Integrity: We ensure the highest level of integrity to our customers, creating an ongoing relationship of trust and confidence. We treat our customers with honesty, fairness and respect.
Belief in our people: We recognize that employees are our most valuable asset and our competitive strength. We respect the worth and dignity of individual employees who devote their careers for the progress of the bank. We trust in equal treatment to all shareholders irrespective of their individual size of shareholdings.
Teamwork: We are a firm believer in team work and feel that loyal and motivated teams can produce extraordinary results. We are driven by a performance culture where recognition and rewards are based on individual merit and demonstrated track record.
Corporate Governance: Effective corporate governance procedures are essential to achieve and maintain public trust and confidence in any company, more so in a banking company. At RBL, we are committed to following best practices resulting in corporate governance.
Corporate Social Responsibility: As a responsible corporate citizen, we consider it important to act in a responsible manner towards the environment and society. Our commitment has always been to behave ethically and contribute towards the improvement of quality of life of our people, the community and greatly the society, of which we are an integral part.
The Guardian: Would you also discuss the forward looking statements of RBL?
Managing Director: Our future outlook is already defined and we are now working to attain our particular goal. In close cooperation with the Board of Directors, Rupali Bank has undertaken visionary strategies to establish it a ‘model bank’ among the public and private sector banks.
Accordingly, modern and time-befitting technologies are being applied at all levels of structural and operational functions to ensure transparency and prompt services to the valued customers of the bank and necessary planning and policies are also adopted thereof.
As a result, after long 22 years, the honorable shareholders received 10 per cent stock dividend in 2010 and 20 percent stock dividend in 2011 and 10 percent stock dividend in 2012. For 2013, 12.50 percent stock dividend has been recommended for the shareholders.
The strategies are, however, already started to implement as short-term and mid-term basis to achieve the desired success as well as to attain the visionary goal of model bank. These are as follows:
Launching new and innovative products on deposit and loan to keep pace with the competitive banking business and rewarding the HR for the innovations;
Joint venture or co-branded operations with other organization;
Bring the SME under the main-stream of investment to absorb a huge section of people for employmen;
Uproot the anomalies and corruption through making the audit system modern and technology-driven; Compliance of Target-based Charter with proper co-ordination among head office, divisional offices and branch offices;
Construction of high-rise buildings at the own land located in Dhaka, Chittagong, Mymensingh, Khulna and Comilla;
Proper decoration of all floors of the head office, divisional offices, corporate branches and other branches located in the prime location of district town;
Further extension of ATM services up to remote areas;
Increase of AD branches to widen foreign exchange business and remittance operations;
Opening of branches at Upazila and commercially important places where Rupali bank’s branches are absent;
Launching Islamic Banking very soon;
Establishment of a welfare-oriented and non-profit subsidiary company-Rupali Bank Foundation- to widen the CSR activities under which charitable institutions will be set up;
Foreign Remittance System will be launched at all branches by the end of 2014 to clear foreign remittance in 24 hours. Drawing arrangements with more exchange companies will be done with posting of own officials and remittance software will be installed to facilitate delivery channel;
All operations of the Bank will be brought under automation to facilitate online banking;
Tough action against loan defaulters and recover the loans from the top defaulters;
Tk. 3200 crore additional deposit will be collected through opening 5.00 lac new accounts;
Taking a 100-day campaign in favor of the newly launched products and recovering the classified loans.
The Guardian: Would you inform us about the figure of current authorized and paid-up capitals of RBL?
Managing Director: At present our authorized capital is Tk 700.00 crore and paid-up is Tk 181.50 crore. We are expecting to approve 12.50 percent stock dividend to the shareholders, which will ultimately raise the paid-up capital more than Tk 200.00 crore.
The Guardian: Would you reflect the current organogram of RBL and also discuss the management system of the bank?
Managing Director: The organogram of the bank is presented here.
The Guardian: Would you mention the number branch, booth and subsidiary company currently operated by RBL at home and abroad?
Managing Director: We have 532 branches, operating across the country and 38 ATM booths. We do not have any branch or booth outside the country. However, we have some agency arrangement with a number of foreign banks and exchange houses.
Besides, we have two subsidiaries. These are
Rupali Investment Limited,
Rupali Bank Securities Limited.
The Guardian: And also mention the total number of personnel working at various levels with the network of RBL at home and abroad?
Managing Director: Currently, we have 1st class and 2nd officers in total 4328 against 6546 approved manpower, 3rd class employee is 433 against 420 approved manpower and 4th class employee is 1364 against 3593 approved manpower. Now we have total working officers and employees are 6125 against 10559 approved manpower.
The Guardian: Would you mention what digital facilities are introduced into the network of RBL for providing quality and standard services to the RBL clients at home and abroad?
Managing Director: You know a good number of steps have been taken by the management authorities to set up online banking. As part of this step, all branches and controlling offices of the bank are already equipped with computers. Out of 514, 480 branches are running ‘live operation’, the rest are under process.
Besides, the following steps are already taken
w One Stop Service launched in 127 branches to ensure prompt customer service while 148 branches came under ‘anywhere branch banking’, some more are under process.
w The BACH operation began in 142 branches of the country through truncation point.
w CIB Online Software installed to bring 10 divisional offices, 13 work stations and 13 corporate branches and other 6 branches under its network through Modem connection. A total of 600 officials/employees were trained.
w BEFTN is implemented in 517 branches.
w Important branches installed CC Tv to ensure fool-proof security.
w Projects underway to launch DC, DCR, Core Banking Software through online banking.
Moreover, Rupali Bank remains committed to introduce technology-driven mechanism aiming to provide prompt and hassle-free services. Rupali Bank is the first state-owned bank to provide alternative channel service through installing 39 ATM booths at its first phase.
We are set to install ATMs at every district towns and important areas of the country within a shortest possible time. Though Rupali Bank will bear a huge amount of money, we are ready to accomplish this project just to serve the valued customers.
The Guardian: Would you say what facilities are available at RBL to provide modern training and latest knowledge of banking sector to its personnel working at home and abroad to provide the expected services to the clients, meeting the demand of this highly competitive age?
Managing Director: We have rich training centre viz, Rupali Bank Human Resource Development Centre (RBHRDC) where all facilities are available to provide modern training and latest knowledge of banking sector to all categories of employees of Rupali Bank Limited.
In the perspective of highly competitive situation of market, we are trying to make our people competent to face any challenging situation.
The Guardian: Would you mention the target fixed for disbursing loans in the current fiscal year?
Managing Director: Rupali Bank Limited usually approves a budget of all financial, business and administrative area, which is usually made on calendar year. According to budget 2014 the target of disbursing loans and advances is Tk 1556 crore.
The Guardian: In this context, please mention the sectors of priority for disbursing these loans.
Managing Director: The sectors of priority for disbursing loans are as follows:
1. Agriculture and agro-based trading and industries sector,
2. SME and professional sectors,
3. Power sector and Bio-gas plant,
4. Solar and renewable energy production,
5. Green banking sector is the most priority sector where 25% of the total budget is targeted,
6. Human Resource Development Sector,
The Guardian: Would you inform us about different other schemes or products that are currently run by RBL side by side the general banking?
Managing Director: The other schemes or products that are currently run by RBL side by side the general banking are as follows:
1. Utility bill collections;
2. CSR Activities;
3. Delivering Upabritti, Muktijuddha Bhata, Bidhoba Bhata, Boyosko Bhata for government;
4. Arranging teachers’ salary;
5. ATM service;
6. Collecting Hajj deposit, Income tax, Excise duty;
7. Distributing admission form for university admission;
8. Effecting Local and Foreign remittance;
9. Internship facility for BBA and MBA students.
The Guardian: In this context, please discuss the role of RBL in export and import business.
Managing Director: Total volume of import in the year 2011, 2012 and 2013 was Tk 6926.00, 4511.00 and Tk 6517.00 crore respectively and total volume of export at the same time was Tk 1351.00, Tk 1551.00 and Tk 1817.00 respectively. The expected import and export for the year 2014 is Tk 6500.00 and Tk 2000.00 crore respectively.
The Guardian: Would you discuss the risk factors or measures available for ensuring recover of RBL stuck-up loans?
Managing Director: Steps taken to reduce Non-perform loans (NPL) are as follows:
1. Central task force for recovery of NPL was formed at Head Office which is headed by our Deputy Managing Director. Besides 10 task forces were formed in 10 divisional offices & another task force was formed in our local Office where major position of total NPL are outstanding. Task force members have been assigned with responsibility of recovery/ regularization of NPL.
2. Target of recovery of NPL was given to all Divisional Offices & branches at the beginning of the year. Progress of recovery is reviewed & monitored by higher management on regular basis.
3. Bileteral discussion meetings of Management with defaulting borrowers are held at Head Office, Divisional Office & Corporate branches to motivate the borrowers to repay their loans. Such programmed facilitates the borrowers to pay off their loans through remission of interest.
4. Bank has appointed 13 recovery specialists who were posted in deferent areas. They are directly contacting defaulting borrowers in the respective areas for recovery/regularization of their liabilities.
5. Steps have been taken to dispose off the writt petitions filed by the borrowers. Meanwhile, some writs were disposed in favour of bank. A full time legal adviser has been appointed at Head Office to deal with complicated legal issues which create hindrance in recovery process.
6. Special crush programmes like “50 days special programme”, “100 days special programme” etc. are launched by management to create dynamism in recovery process. At present a “Special Recovery Campaign” has been launched by Bank management with a target to recover NPL of Taka 300 crore in cash which started from 27.10.2013 & will end on 30.12.2013.
7. To encourage the employees for recovery, Prizes are being awarded under certain conditions to persons who can successfully recover the defaulted loans. Besides, power of interest waiver has been delegated at field level to accelerate recovery activities.
The Guardian: In this context, would you discuss current defaulters’ situation of RBL and what legal steps you are taking to make recovery?
Managing Director: Total loans and advance as on December 31, 2013 is Tk. 10742.64 crore out of which classified advance is Tk.1053.91 crore which is 9.81% of total advance. Amounts of sub-standard, doubtful and bad advance are Tk. 59.79 crore, Tk. 22.69 crore and Tk. 971.43 crore respectively. Money suit filed against most of the defaulted borrowers under relevant section of Artha Rin Adalat Ain 2003. Some borrowers are trying to create obstacles in disposal of cases by filing writ petitions in the honourable High Court.
The Guardian: So far it is learnt that RBL has won a number of local and international awards. Please inform us about what performances the bank has won these awards.
Managing Director: Rupali Bank Limited has won several prestigious awards for its best published accounts reports and compliance of corporate governance locally and internationally from the following renowned organizations:
Rupali Bank Limited won the SAFA BEST Presented Annual Reports award and SAARC Anniversary Award for Corporate Governance 2011 and 2012 in the Public Sector Banking Institutions category secured First Position.
The Bank received the First Prize of the 12th ICAB National Awards for Best Published Accounts Reports 2011 and 2012 in the public sector banking institutions.
Rupali Bank Limited has received the Second Prize in the State owned Commercial Bank Section the ICMAB Best Corporate Award 2012 presented by the Institute of Cost and Management Accountants of Bangladesh (ICMAB).
RBL won the Second Prize of the 11th ICAB National Awards for Best Published Accounts Reports 2010 in the Public Sector Entities status.
RBL has also received in the State owned Commercial Bank Section the ICMAB Best Corporate Award 12011 presented by the Institute of Cost and Management Accountants of Bangladesh (ICMAB).
The Guardian: Keeping this in mind, would you appraise the present position of RBL among the public and private commercial banks currently operating in Bangladesh?
Managing Director: The RBL has made a glorious achievement among the state owned commercial banks in Bangladesh over the period of last four years in all the indicators. Overcoming a series of obstacles, Rupali Bank has achieved remarkable profit, single digit classified loan, huge amount of cash recovery, notable development of human resource, completion of rapid computerization renovation, ATM services, developing risk based audit and inspection activities, remolding risk management activities and image building are worth mentionable.
During the period of global economic meltdown while other public and private sector banks had been going through a lot of negative indicators of their performances, Rupali Bank had done an excellent performance at that time, which was acknowledged to the bank by offering a good number of national and international awards in the last three years.
The Guardian: Would you inform us about the current figure of profit and loss and assets and liabilities of RBL?
Managing Director: I think you can find a better picture of our profit and loss and assets and liabilities through the following chart.
The Guardian: Would you discuss the limitations, shortages, failures, achievements and future plans of RBL?
Managing Director: As a state-owned commercial bank, Rupali Bank Limited has some degree of limitations in performing business. This are-
Restrictions imposed by Bangladesh Bank through signing MoU in respect of credit growth and investment activities and operating cost.
Restriction in capital expenditure for increasing asset and completing on-line activities.
Lack of sufficient employee and skilled and experienced manpower
Lack of on-line service for rendering prompt customer service
So far I realize Rupali Bank has no remarkable failure during the period of my tenure as Managing Directorship.
You are already briefed about our achievement and future plans.
The Guardian: Would you discuss the role of the present board of directors in guiding the management of RBL to resolve its various problems as well as to attain the future goals of RBL?
Managing Director: It is a great pleasure for me to mention that we have a very friendly and amicable environment between Board of Directors and the management. The present Board of Directors is highly efficient and cooperative in resolving any problems we usually faces. They never interfere in any of our management activities and advise us to lead the RBL to make a number one bank in all the public sector banks in Bangladesh. The Board of Directors formulates time-befitting policies and strategies for running business, administration and other activities of the bank.
The Guardian: In the end, please give your valuable message for the people of Bangladesh, and especially for the future generation bankers of Bangladesh?
Managing Director: Our future generation should believe that perseverance, professional knowledge, modesty, ethical standard and integrity are a must for becoming a successful banker. They must be updated with continuously changing policies and procedures in the banking system. They must be committed to their duties and responsibilities.
Alongside this, good communication skill is of the important keys to bring a banker to the top position of his career. I believe this very quality is helpful to develop relationship with the new community and maintain strong customer base.