Posted: February 17th, 2022

Role of Icb In the Development of Capital Market In Bangladesh

INTERNSHIP REPORT Dept. of Enterprise Administration Shah Jalal College of Science and Expertise, Sylhet. INTERNSHIP REPORT Role of ICB in the Development of Capital Market in Bangladesh: A Efficiency Analysis of ICB Sponsored Mutual Funds Supervisor Ms. Nafsaniath Fathemaf Lecturer Division of Enterprise Administration Shah Jalal College of Science and Expertise, Sylhet. Submitted By Muhamad Abul Lyse 4th Yr 2nd Semester (2nd Batch) Reg No: 0099730014 Dept of Enterprise Administration Shah Jalal College of Science and Expertise, Sylhet Date of submission: July 06, 2006 Date July 06, 2006
It’s an immense pleasure for me to certify that this internship report entitled “ Role of ICB in the Development of Capital Market in Bangladesh: A efficiency analysis of ICB sponsored mutual funds” submitted to the division of Enterprise Administration, Shah Jalal College of Science and Expertise, Sylhet is an unique work achieved by Muhammad Abul Lyse, a pupil of BBA 2nd Batch of Division of Enterprise Administration, bearing the Registration quantity 0099730014. He has efficiently accomplished the internship program at Funding Company of Bangladesh (ICB) and ready this report on the aforesaid title underneath my supervision.
I want him each success in his endeavors. Signature: ………………………… Ms Nafsaniath Fathema Lecturer, Dept. of Enterprise Administration Shah Jalal College of Science and Expertise Sylhet-3114. July 06, 2006 Ms Nafsaniath Fathema Lecturer, Dept. of Enterprise Administration Shah Jalal College of Science and Expertise Sylhet-3114. Sub: Submission of internship report Pricey Madam, Have the pleasure in submitting my internship report titled “Role of ICB in the Development of Capital Market in Bangladesh: A Efficiency Analysis of ICB Sponsored Mutual Funds .

As an integral half of my BBA diploma, I’ve been assigned to work on the subject, with a view to nicely combine the theoretical data I’ve realized all through my 4 years of examine and thus to positive tune these data with sensible work expertise in a monetary establishment like ICB, the pioneer and largest Funding Financial institution of the nation. The Internship Program was very a lot precious because it helped me to realize an actual life expertise working in knowledgeable setting. I attempted my greatest to get an in depth protection of the subject and emphasised on utilizing genuine knowledge
I’m grateful to you to your variety suggestion and useful recommendation in making ready this report. As soon as once more, thanks very a lot certainly for giving me the alternative to work underneath your variety supervision. Yours Sincerely Muhammad Abul Lyse Reg. NO: 0099730014 Division of Enterprise Administration (2nd Batch) Shah Jalal College of Science and Expertise, Sylhet. Contents half one Chapter one : iNTRODUCTION CHAPTER TWO: icb and ITS FUNTIONS CHAPTER tHREE: position OF ICB IN THE CAPITAL MARKET OF BANGLADESH CHAPTER FOUR: PERFORMANCE OF icb CHAPTER FIVE: SUBSIDIARY COMPANIES OF ICB half two CHAPTER ONE: ICB SPONSORED MUTUAL FUNDS
CHAPTER TWO: findings and suggestions of an actiOn an PLAN Detailed contents pART ONE CHAPTER 1: iNTRODUCTION 1. Goal of the Study1 2. Scope of the Study1 three. Methodology of the Study2 four. Limitations of the Study4 CHAPTER TWO: ICB AND ITS FUNCTION 1. Background of the ICB5 2. Objectives5 three. Features of ICB6 four. Enterprise Policy7 5. Capital Structure7 6. Share Value of ICB8 7. Share holding Place of ICB9 eight. Merchandise of ICB11 9. ICB at a Look14 10. Traders Scheme of ICB16 11. Group Construction of ICB20 12. ICB Mutual Funds22 13. ICB Unit Funds23 14. Development Actions of ICB27
CHAPTER THREE: ROLE OF ICB IN THE CAPITAL MARKET OF BANGLADESH three. 1 Capital Market28 three. 1. 1 Role of Capital Market in the Financial Development of a Nation28 three. 1. 2 Funding Course of29 three. 2 Monetary Market30 three. 2. 1 Goal of the securities Market30 three. 2. 2 The Role of Authorities30 three. three Monetary Market of Bangladesh31 three. three. 1 Cash Market32 three. three. 2 The non-Securities section of the Capital Market32 three. three. three The Securities-segment of the Capital Market32 three. four The Parts of Safety Market33 three. 5 Making a Provide of Good Securities in Market333. 6 The Origin and improvement of Capital Market in Bangladesh33 . 7 The Current State of affairs of Bangladesh Capital Market35 CHAPTER FOUR: PERFORMANCE OF ICB four. 1 Role of ICB in the Capital Market of Bangladesh36 four. 2 Operational Actions of ICB41 four. 2. 1 Consideration of Purposes41 four. 2. 2 Dedication42 four. 2. three Disbursement 46 four. 2. four Mortgage Portfolio47 four. 2. 5 Trustee, Custodian, and Concern Supervisor48 four. 2. 6 Lease Financing49 four. three Portfolio Administration50 four. four Different Operational Actions51 four. four. 1 Advance in opposition to ICB unit and Mutual Fund certificates Scheme51 four. four. 2 Shopper Credit score Scheme52 four. four. three Merchandising Operations52 four. four. four ICB Mutual Fund52 four. four. Transaction of Securities53 four. 5 Participation in Worldwide Actions53 four. 5. 1 ICB’s involvement with South Asian Development Fund (SADF)53 four. 5. 2 Funding in South Asia Regional Fund (SARF)54 four. 6 Monetary End result of ICB 55 four. 6. 1 Complete Expenditure56 four. 6. 2 Internet Earnings56 four. 6. three Dividend57 four. 6. four Some Key Monetary Ratios58 CHAPTER FIVE: THREE SUBSIDIARY COMPANIES OF ICB 5. 1 Subsidiary Corporations of ICB595. 2 ICB Capital Administration Restricted (ICML)59 5. 2. 1 Background of ICML 5. 2. 2 Imaginative and prescient of the Firm59 5. 2. three Mission of the Firm60 5. 2. four Some Salient Options of ICML buyers’ Scheme60 5. . 5 Benefits of ICML Traders’ Scheme61 5. 2. 6 Margin Mortgage61 5. 2. 7 Monetary Efficiency of ICML63 5. three ICB Asset Administration Restricted (AMCL)63 5. three ICB Securities Buying and selling Firm Restricted (ISTCL)66 PART TWO CHAPTER ONE: ICB SPONSORED MUTUAL FUNDS 1. Some key points of Mutual funds 68 1. Definition of Mutual Funds 68 2. Varieties of Mutual funds 68 2. ICB Mutual Funds 69 1.
Nature of Enterprise 70 2. Find out how to purchase present Mutual funds 70 three. Administration of the funds 70 four. Property of ICB Mutual funds 70 5. Administration payment, Cost and so forth. 71 6. Declaration of Dividend 71 three.
Operational Highlights of ICB Mutual Funds 72 four. Monetary Assertion Assessment of ICB’s Mutual Funds 76 1. Earnings Per Share (EPS) 76 2. Dividend Per Share 78 three. Dividend Payout Ratio 79 four. Incomes Yield Ratio 80 5.
Dividend Yield Ratio 81 6. Value Incomes Ratio 82 CHAPTER TWO: FINDINGS AND advice 1. Discovering about The Capital market of Bangladesh83 2. 1. 1 Lack of Confidence83 2. 1. 2 Frequent Financial Change83 2. 1. three Liquidity Disaster84 2. 1. four Risky Market Scenario84 2. 1. 5 Absence of good Securities85 2. 1. 6 Absence of Authorities initiative85 2. 1. 7 Market Maker85 2. 1. eight Consciousness85 2. 1. 9 Lack of data85 2. 1. 10 Mass Participation86 . 2 Findings about Funding Company of Bangladesh86 2. 2. 1 Providers stopped by ICB86 2. 2. 2 Unfair dividend Coverage of Mutual funds86 2. 2. three Irredeemable Mutual funds87 2. 2. four Absence of effectivity in Portfolio administration of MF87 2. 2. 5 Prolonged Processing87 2. three Advice of an Motion Plan88 2. four Conclusion 90 Bibliography 92 Acronym and Appendices I. Appendix : Or anagram of ICB II. Appendix: Steadiness Sheet and Earnings Assertion of ICB
Govt Abstract Funding Company of Bangladesh (ICB), established in 1976, is just about the solely Funding Financial institution in Bangladesh. In a broader sense, ICB is each an funding Financial institution and Development Monetary Establishment. (DFI). ICB performs a pivotal position to encourage and broaden the base of funding and thereby to Help to develop a vibrant capital market in Bangladesh. ICB caters to the want of institutional Help to fulfill the fairness hole of rising new corporations. ICB works with a view to mobilise financial savings of normal public and evokes small and medium savers for funding in securities.
As s single entity, Authorities of Bangladesh holds majority shares of ICB (i. e. 27%). With various features, ICB operates on business foundation, gives monetary help to tasks topic to their financial and business viability and arranges fairness and loans singly or by way of consortium of monetary establishment. Features of ICB embrace; buying of shares and debentures together with placement and direct participation, managing present mutual funds and funding accounts, offering funding counseling to buyers and serving to authorities to its divestment applications.
The next report titled “The Role of ICB in the improvement of Capital Market in Bangladesh: A Efficiency Analysis of ICB Sponsored Mutual Funds” accommodates a complete overview of ICB with particular emphasis on ICB’s position in the improvement of capital market in Bangladesh. Likewise, an Assessment of ICB sponsored Mutual funds is made with element monetary Assessment as ICB since its inception, have been performing a pioneering position in the capital market of Bangladesh by managing the portfolios of ICB’s eight mutual funds. Since 1980, ICB floated a complete of eight mutual funds with paid up capital of Tk 17. zero crore. After taken a restructuring program of ICB underneath Capital Market Development Program (CMDP) initiated by the authorities of Bangladesh and the Asian Development Financial institution (ADB) and in phrases of energy conferred in the ICB ordinance three subsidiary corporations, specifically (1) ICB Capital Administration Restricted (2) ICB Asset Administration Firm Restricted and (three) ICB Securities Buying and selling Firm Restricted have been created and made operational to hold out service provider banking, mutual fund operations and inventory brokerage features respectively. The report is split primarily into two elements.
Half One accommodates a complete protection of ICB with its position in the improvement of capital market in Bangladesh and Half Two establishes half one by analyzing the ICB sponsored Mutual funds as ICB performs a central position in the capital market of Bangladesh by managing its eight mutual funds. Half One consists of 4 Chapters. Chapter One contains the goal, scope, methodology and limitations of the examine. Chapter Two describes historic background, goals, enterprise insurance policies, features, capital construction and merchandise of ICB.
Chapter Three clarify the monetary market and varied segments of monetary market of Bangladesh. The chapter additionally establishes the position of ICB in the improvement of Capital Market in Bangladesh. Chapter 4 illustrates the efficiency of ICB. Chapter 5 features a description of three subsidiary corporations of ICB. Half Two consists of two chapters. Chapter one evaluates the ICB sponsored mutual funds. This chapter initially offers with some theoretical ideas of mutual funds after which an in-depth monetary efficiency of ICB mutual funds.
Chapter two contains some findings of the examine with advice of an motion plan. The report ends with a bibliography and an appendix. Acknowledgments I want to categorical my gratitude to Dr. Md. Nazrul Islam, Head and Affiliate professor of the Division of Enterprise Administration of Shah Jalal College of Science and Expertise, Sylhet and All of the Lecturers of the Division particularly to my supervisor Ms Nafsaniath Fathema who always impressed, supervised, and inspired me with precious recommendation and cooperation by way of the entire interval of my internship Program.
I’d additionally like to precise my particular regards to Ms Nasreen Sultana, AGM of the Personnel Division, who allowed and gave me the alternative to work in Funding Company of Bangladesh, the pioneer Funding Financial institution of the nation. I’m additionally extremely grateful to the authority of ICB and all the AGMs of varied departments who helped me loads and cooperated me throughout my internship interval. I’m in pleasure to the categorical my gratitude to the internship and placement committee of the Division of Enterprise Administration particularly to the oordinator of the committee, Mohammad Imtiaz Ferdous, additionally the Helpant Professor of the Division of Enterprise Administration. I want to prolong my particular because of Ms Sharmin, Senior Principal Officer of Personnel Division, Subashis Chakrabarti, Helpant librarian of the ICB and all the respective officers of ICB for his or her cordial cooperation and useful recommendation. As the first work of my life, I’d bear this fond reminiscence of ICB for the relaxation of my life. | | | | | | | | | | | | | | | | | | |PART ONE | | | | | | | | |CHAPTER ONE | | | | | |INTRODUCTIONS | | | | | | | | | | | | | | | | | | | | | | 1. 1 Goal of the Examine Studying by doing is an efficient means of buying data. To have an actual life publicity, every pupil of Division of Enterprise Administration, of Shah Jalal College of Science and Expertise has to hold out an internship program as an integral half of his/her BBA diploma.
Since, solely the theoretical data cannot make one match for growing aggressive state of affairs of the world, the internship placement committee had positioned me at ICB for a interval of three months. Different goal of this examine is as follows: ? To narrate educational data with actual life enterprise world. ? To have an general thought about the position of ICB in the capital market of Bangladesh with a particular emphasis on ICB sponsored Mutual Funds[1]. ? To analyse the profitability of ICB sponsored mutual funds. ? To search out out prevailing disadvantage and missing of ICB, if there’s any, and suggest an motion plan. 1. 2 Scope of the Examine The scope of this report is just one organisation i. e.
Funding Company of Bangladesh (ICB) and specifically the Mutual Funds as it’s the focus space of this report. It has been talked about earlier, the essential goal of the examine is to analyse the position of ICB in the improvement of Capital market in Bangladesh with an emphasis on ICB sponsored mutual funds. The report provides an summary of ICB adopted by a component on monetary involvement of ICB. The report establishes the theoretical and conceptual framework evaluating with which the capital market will probably be judged. There may be one elaborate half that offers with the ICB sponsored mutual funds. The examine may also current some issues of ICB noticed throughout the internship coupled with some advisable motion plan. 1. Methodology of the Examine Methodology might be referred as underlying rules and guidelines of group or the philosophical methods that work at the backdrop of any examine. It clarifies the issues involving the analysis in a really ordered and systematic vogue. Methods are decided at this stage for future implementation. In conducting any formal survey and making ready any analysis paper two varieties of knowledge i. e. Major Knowledge and Secondary Knowledge, are used. I attempted my greatest to gather each sorts of knowledge and data and have agency intention to emphasis on major knowledge as it’s usually up-to-date and extra helpful than any printed data.
Initially we collected uncooked knowledge from departments of ICB after which type out helpful data related to my paper. Approaches and strategies which were used to organize this report are as follows. 1. Private interview: ICB has 25 departments and three subsidiary corporations up to now. I personally interviewed virtually all AGMs of all departments and talked with the senior Principal Officer, principal Officer and different officer of involved departments. 2. Briefing Session: Division heads (DGMs[2]) and division heads (AGMs) or their authorized officers gave briefs about their respective departments. Info gathered from these periods has been utilized in the report. three.
Printed experiences: a big quantity of knowledge are taken from the printed sources similar to ICB’s annual experiences of earlier years, Annual experiences ICB Mutual Funds, Month-to-month overview of Dhaka and Chittagong Inventory Trade. four. Choice of the pattern: the pattern space of this examine covers the head workplace of ICB. Since the central monetary actions are achieved underneath surveillance of the Head workplace of ICB, so the choice of pattern of this examine is justifiable. Knowledge collected from totally different divisions of ICB are all equally essential segments of pattern used on this examine. ICB as a nationwide funding establishment has added a tempo in creating the capital market of Bangladesh. In consequence of this significance the choice of ICB as the pattern space of this examine is presumably the demand of the time. 5.
Time schemes: As acknowledged earlier since the function of this internship program is an publicity to sensible life, the ICB administration has deputed me to all the division, departments, sections and cell to accumulate hand-on-experience about every of them. I’ve visited the departments in accordance with the following schedule. | |Identify of the Departments |From |To | |  |  | |  | |1 |Personnel Division |27. 03. 2006 |28. 03. zero06 | |2 |Secretary Division |29. 03. 2006 |  | |three |Planning analysis and Enterprise improvement Dept. |30. 04. 2006 |09. 04. 2006 | |four |Administration Info Dept. |10. 04. 2006 |12. 04. 2006 | |5 |Securities Assessment Dept. |13. 04. 2006 |16. 04. 2006 | |6 |Investor’s Dept |17. 04. 2006 |19. 04. 2006 | |7 |Shares Dept. and reconciliation Cell |20. 04. 2006 |25. 04. 2006 | |eight |Unit gross sales Dept. |26. 04. zero06 |27. 04. 2006 | |9 |Unit registration and assortment Dept. |30. 04. 2006 |02. 05. 2006 | |10 |Mutual Fund Dept. |03. 05. 2006 |07. 05. 2006 | |11 |Central Accounts Dept. |08. 05. 2006 |10. 05. 2006 | |12 | System Assessment Dept. |14. 05. 2006 |15. 05. 2006 | |13 |Programming Dept. |16. 05. 2006 |17. 05. 2006 | |14 |Mortgage Appraisal Dept/Lien Cell |18. 05. 2006 |21. 05. 2006 | |15 |SAARC Cell |22. 05. zero06 |—- | |16 |Venture Implementation Dept. |23. 05. 2006 |—- | |17 | Mortgage Restoration and Monitoring Dept. |24. 05. 2006 |25. 05. 2006 | |18 |Venture Mortgage Account Dept. |28. 05. 2006 |—- | |19 |Public Concern Dept. |29. 05. 2006 |—- | |20 |Trustee Dept. |30. 05. 2006 |31. 05. 2006 | |21 |Regulation Dept. |01. 06. 2006 |04. 06. 2006 | |22 |Audit and Methodology Dept. |05. 06. 2006 |06. 06. 2006 | |23 |Division Management Dept |07. 06. zero06 |—- | |24 |Institution Dept. |08. 06. 2006 |11. 06. 2006 | |25 |public Relation Dept. |12. 06. 2006 |—- | |26 |ICB Asset Administration Firm Ltd |13. 06. 2006 |15. 06. 2006 | |27 |ICB Capital Administration Ltd |18. 06. 2006 |20. 06. 2006 | |28 |ICB Securities Buying and selling Ltd |21. 06. 2006 |26. 06. 2006 | Desk 1. 1: Schedule of working at ICB 1. four Limitations of the Examine Limitations are apparent in any examine so do right here.
Since that is an internship report, the limitations relating to the internship programm has acted as the limitation of the examine. The findings we found out, and the advice we made will not be 100% correct and will not characterize the actual state of affairs. Ultimately, in completion of my examine, a quantity of constraints and limitations I confronted. These might be thought of as follows: ? Efficiency Assessment of ICB and its mutual funds might not characterize the present situation of the organisation and its mutual funds as all the Assessment are based mostly on the knowledge of June 30, 2005. Since the present yr monetary disclosures are usually not public but, so the Assessment is just a little backdated. ? Officers of ICB keep a really busy schedule.
So that they weren’t all the time capable of present sufficient time to counterpoint the intern college students each time, even when that they had the intention to take action. ? Resulting from safety causes and organizational privateness we didn’t have entry to some core areas of ICB. ? I needed to go virtually each division of ICB throughout my three months internship programm at ICB. Three months is a really quick p of time to get an in-depth data a couple of big group like ICB. ? The realm lined by the report “The position of ICB in the improvement of Capital Market in Bangladesh: A Efficiency Analysis of ICB Mutual Funds” considerations an enormous a quantity of actions and it is vitally tough to sketch a complete image of the monetary actions in a report of this quick scale. | | | | | | | | | | | | | | | | | | | | | | | | | | | |CHAPTER TWO | | | | | |ICB AND ITS FUNCTIONS | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2. 1 Background of the ICB The funding company of Bangladesh (ICB) was established on 1st October 1976, underneath “The Funding Company of Bangladesh ordinance, 1976” (no XL of 1976).
The institution of ICB was a significant step in a collection of measures undertaken by the Authorities to speed up the tempo of industrialization and to develop a nicely organized and vibrant capital market notably securities market in Bangladesh. ICB caters to the want of institutional Help to fulfill the fairness hole of the corporations. In view of the nationwide coverage of accelerating the price of financial savings and funding to foster self –reliant economic system, ICB assumes an indispensable and pivotal position. By the enactment of the Funding Company of Bangladesh (Modification) Act 2000 (no 24 of 2000), reforms[3] in operational methods and enterprise insurance policies have been applied by establishing and working subsidiary corporations with ICB as the holding firm. 2. 2 Goal
As the nation’s Pioneer Funding Financial institution, ICB has been working to help the small buyers in mobilizing their financial savings. ICB works with a view to broaden the base of the funding of the nation, guarantee mass participation of normal folks in the capital market and thus to contribute in direction of the GDP of Bangladesh. ? To encourage and broaden the base of investments ? To develop the capital market ? To mobilise financial savings ? To advertise and set up subsidiary corporations for enterprise enlargement. ? To offer for issues 2. three Features of ICB To develop the capital market of Bangladesh, and mobilise the financial savings of small buyers, ICB perform a variety of diversified features.
With a strong view to foster and speed up the financial progress of the nation, ICB gives all kinds of monetary companies to the potential sector. Making certain equal distribution of financial advantages gained by the economic system amongst the grass root degree is one of the essential goals of ICB. Varied features of ICB might be talked about as follows. In contrast to some other monetary establishments, ICB maintains a portfolio of the authorities comprised of totally different securities of listed corporations and helps authorities advising relating to fiscal and financial coverage of the nation. As a market maker it floats mutual funds, points unit certificates, underwrites securities and manages issuance of securities. | | | |Underwriting of preliminary public providing of shares and debentures | | |Underwriting of proper subject of shares | |Primary |Direct buy of shares and debentures together with Pre-I[4]PO placement and fairness participation | |Features |Offering lease finance to industrial equipment and different equipments singly or by forming syndicate | |Of |Managing buyers’ Accounts | | |Managing Open Finish and Closed Finish Mutual Funds[5] | |ICB |Working on the Inventory Exchanges | | |Offering funding counseling to issuers and buyers | | |Collaborating in authorities funding program | | |Collaborating in and financing of, joint-venture tasks | | |Dealing in different issues associated to capital market operations | | |Trusty, Custodian, Financial institution Assure | | |Shopper Credit score | 2. four Enterprise Coverage The company has adopted a sensible enterprise coverage framework inside which its operation is carried out.
The company, acts on business consideration with due regard to the curiosity of trade, commerce, depositors, buyers and to the public basically. | | | | |To offer monetary help to tasks topic to their financial and business viability. | |Enterprise |To rearrange consortium of monetary establishments together with service provider banks to supply fairness Help to | |Coverage |tasks and thereby unfold the threat of underwriting. | |Of |To develop and encourage entrepreneurs. | |ICB |To diversify investments in securities. | |To create employment. | | |To encourage Funding in IT sector. | | |To encourage Funding in three way partnership capital/mission. | 2. 5 Capital Construction | Capital Construction of ICB -as on June 30, 2005 (Tk in crore) | |Authorised capital |100. 00 | |Paid up capital |50. 00 | |Reserve |84. 11 | |Retained revenue |5. 6 | |Long run govt. Mortgage |5. 25 | |Debentures |61. 80 | |Others |24. 89 | |Complete |231. 41 | Supply: Drawn based mostly on the knowledge of ICB Annual Report 2004-2005 Determine 2. 1 Capital Construction of ICB Share value of ICB Share value of for the final yr was as follows: Fig 2. 2: 2. 7 Share holding Place of ICB
Fairness participation from a variety of establishment together with the authorities of Bangladesh has made the capital construction of ICB as a novel. Nationalised banks, Non-public business banks, Bangladesh Financial institution together with the normal public have possession in ICB. |Shareholding place of ICB (as on June 30,2005) | |Shareholder |No. of share holder |No. of shares |Share | |Governments of Bangladesh |1 |1350000 |27. 00 | |Nationalised Industrial Banks |four |1137220 |22. four | |Development Monetary Establishment |2 |681550 |13. 63 | |Insurance coverage Corporations |three |618286 |12. 37 | |Bangladesh Financial institution |1 |600000 |12. 00 | |Denationalized Non-public Com Banks |2 |454263 |9. 08 | |Non-public Industrial Banks |three |28286 |zero. 7 | |Overseas Industrial Banks |2 |26531 |zero. 53 | |First BSRS Mutual Fund |1 |6900 |zero. 14 | |Different Establishment |9 |26949 |zero. 54 | |Normal Public |927 |70015 |1. 54 | | Complete|955 |5000000 |100. 00 | Desk 2. 2: Shareholding Place of ICB
Supply: Annual Report 2004-2005 [pic] Determine: 2. three Shareholding place of ICB 2. eight Merchandise of ICB Non-public Placements ICB is permitted to behave as an agent of the issuers and buyers for personal placements of securities. Below this association, ICB locations securities to people/establishments on behalf of the issuer for which it expenses charges. ICB additionally acquires shares/securities for its personal portfolio each in pre-IPO placement and fairness funding. Underwriting[6] In order to lift long run fairness from the major market, the authorities our bodies, enterprises, companies or corporations might search middleman help from ICB in the type of underwriting.
As a result of of its lengthy and confirmed expertise, popularity, asset again up and established community of regional places of work, ICB is in an excellence place to draw the potential buyers to the proposed subject of shares, debentures and different securities for profitable flotation of IPO and placement. Custodian and Banker to the Points To behave as the custodian to the public subject of Open-end & Closed-end Mutual Funds, ICB gives skilled companies. It additionally acts as the Banker to the points and gives related companies by way of the community of its branches. Charges on this regard are negotiable. Mergers and Acquisitions Corporations prepared to broaden their enterprise by way of mergers or acquisitions or o divestment tasks that now not viable into current capability of operation can contact the Company. ICB gives skilled companies & advices in respect of shaping up the value and monetary constructions to make sure absolute best operational outcomes. In addition to, in case of divestment, the company, by way of community and established enterprise relationship, carry patrons and sellers collectively, Help them to barter last settlement and recommendation on the rising company construction. Advance in opposition to Unit Certificates Scheme Advance in opposition to ICB Unit Certificates Scheme was launched in 1998, particularly designed for the ICB unit- holders to fulfill their emergency fund necessities. One can borrow most Tk. 5 per unit by depositing his/her unit certificates underneath lien association from any of the ICB places of work the place from such unit certificates had been issued. The speed of curiosity on the mortgage is cheap and aggressive. Company Monetary Recommendation Authorities enterprises and Corporations desiring to go public subject usually search skilled & monetary recommendation on company restructuring & reengineering. ICB by way of its experience present such companies by way of its experience. Lease[7] Financing ICB Offers lease finance primarily for procurement of industrial equipment, gear and transport. ICB gives skilled recommendation and monetary help to the intending shoppers.
The interval of lease, rental, expenses, and different phrases and circumstances are decided on the foundation of kind of property and the extent of help required by the candidates. Since introduction of this scheme in 1999, good responses have been obtained from the intending lessees. Trustee to the debenture and Securities property ICB is appearing as a trustee to the debenture points and asset-backed securitised bonds. ICB acted as trustee to the points of 17 corporations of which 7 corporations has been redeemed efficiently. Financial institution Assure scheme ICB launched Financial institution Assure scheme in 2002-03. ICB gives (i) Bid Bond for enabling the enterprise folks to take part in any tender or bidding; ii) Efficiency Bond for serving to the enterprise group to proceed their enterprise easily by fulfilling their obligations promised by them to their shoppers; and (iii) Customs Assure for fixing totally different disagreements between the customs authority and the enterprise courses at the preliminary stage. The utmost restrict of assure is Tk. 2. 00 crore and could be issued in opposition to at east 20% money and 80% simply encashable securities or in opposition to 100% money margin. Re-guarantee from different monetary establishment is required for assure in opposition to the quantity exceeding Tk. 2. 00 crore. Shopper Credit score Scheme As half of enterprise diversification program, ICB has launched “Shoppers Credit score Scheme” in 2003-04 contemplating at the want of varied family commodities of totally different staff of govt. , semi-govt. autonomous our bodies and a few established non-public sector organizations. Below this scheme one can take pleasure in minimal Tk 1. zero lac however most 5 lac credit score services. The speed of curiosity on the mortgage is cheap and aggressive which is mounted by the board of administrators of ICB contemplating the financial institution price and with the pointers of Bangladesh Financial institution. 2. 9 ICB at a Look |Particulars |Cumulative as much as June 30, 2005 (Tk in Crore) | |Approved Capital |100. 00 | |Paid up Capital |50. zero | |Monetary Help to tasks (Dedication) | | |No of tasks |431 | |Quantity |536. 87 | |Disbursement of mission mortgage | | |No of tasks |308 | |Quantity |114. 2 | |Trustee to debenture subject | | |No of corporations |17 | |Quantity |184. 15 | |Trustee to subject of bonds | | |No of corporations |5 | |Quantity |134. 6 | |Custodian/Trustee to subject of Mutual Funds | | |No of funds |four | |Quantity |60. 00 | |Supervisor to the subject | | |No of corporations |41 | |Quantity |104. 9 | |Lease financing | | |No of tasks |34 | |Quantity sanctioned |92. 93 | |Public Concern (ICB Helped) | | |No of corporations |111 | |Measurement of subject (Normal public) |368. three | |ICB Traders’ scheme | | |No of accounts opened |77207 | |Funding made |760. 82 | |ICB Mutual Funds | | |Quantity |eight | |Capital fund |17. zero | |Complete market worth of funding |67. 66 | |Dividend per certificates in eight mutual funds for the yr 2004-2005, ranges | | |from Tk 15 to Tk 210) | | |ICB unit fund | | |Gross sale |940. eight | |Price of dividend for the yr 2004-05=Tk12 per certificates | | |ICB’s Transaction in the Inventory Exchanges together with subsidiaries | | |DSE |769. 90 | |CSE |268. 73 | Monetary Outcomes (For the yr 2004-05) (Tk in crore) |Earnings |170. 38 | |Internet revenue after Tax |21. three | |Dividend (Tk per share) |12 | |Manpower (as on June zero,2005) |396 | |No of shareholders ( as on June 30, 2005) |955 | 2. 10 Traders Scheme of ICB Investor scheme is one of the core features of ICB. By buyers’ scheme, ICB ensures Participation of small buyers in the capital market of Bangladesh. The Traders’ Scheme was launched in 1977 with the goal of broadening the base of fairness funding by way of mobilising financial savings of small and medium dimension savers for funding in the securities market.
In addition to Head Workplace, Funding Accounts are additionally operated at the 7 department places of work of ICB positioned at Dhaka, Chittagong, Rajshahi, Khulna, Barisal, Sylhet, and Bogra. Nevertheless in view of strategic adjustments in coverage reform, from 01 July 2002 ICB stopped opening new accounts and ICB Capital Administration Ltd. began opening and managing funding accounts. ICB will proceed to supply companies to its present accounts solely. Desk 2. three: Comparative operational actions of the buyers’ scheme in 2004-2005 and 2003-2004 |Particulars |04-05 |03-04 |Enhance/Lower |Cum as on June 30, 2005 | | | | |(%) | | |No. f accounts opened | — | — | — |72207 | |No. of accounts closed |807 |776 |four. 26 |28327 | |No. of web operative accounts |48880 |49687 |-1. 62 |48880 | |Deposit obtained |22. 7 |27. 31 |-16. 62 |314. 87 | |Loans disbursed |159. 5 |58. 73 |171. 58 |707. eight | |Funding Made |118. 26 |62. 91 |87. 98 |760. 82 | |Curiosity accrued |25. 09 |30. 48 |-17. 68 |— | |Curiosity waived |19. 06 |31. 26 |-39. 03 |55. 52 | |Restoration of margin Loans |179. 6 |103. 14 |74. 13 | —| |Fund withdrawal |40. 18 |13. 09 |206. 95 | —|
Additional steps had been undertaken to boost the high quality and speedy service underneath the scheme like computerization of all actions and set up of merchandizing operation administration software program. This allows the administration to supply higher and fast service to the buyers together with prompt provide of the monetary assertion, portfolio, steadiness of the accounts, and so forth. Set up of phone banking system in Traders’ Account enabling buyers to gather data and function their account over phone was at the last stage of operations. In addition to, set up of Digital show system of DSE on-line buying and selling on the ground of ICB has been arrange. By buyers’ scheme ICB gives the following companies. Authority of Operation
An account could also be operated by the account holder himself/herself or he/she might authorize to a different A/c. holder of buyers account of ICB by written consent in the prescribed type, some one else to function the account on his/her behalf. In case of joint account holders, account could also be operated by single or joint signatories or by authorised operator. Margin Mortgage Presently ICB grants mortgage as much as two instances i. e. at the ratio of 1:three in opposition to the deposits of account holder(s) topic to a most of Tk. three, 00,00zero. 00 to an account. Nevertheless, administration of ICB, at its discretion, might restrict such mortgage. Loans are repayable as per compensation schedule given by ICB.
In the occasion of default of mortgage compensation, the excellent quantity could also be recovered by sale of securities held in the account. Portfolio Administration The account holder might use his/her fairness and the mortgage to purchase securities which ICB retains as collateral. Buy and sale orders are executed by ICB inside the shortest doable time, topic to the availability of fund in the account and scope of matching of patrons/sellers and securities in the inventory exchanges. An account holder or his/her approved individual might place buy/sale execution order in the prescribed type, indicating whether or not, the order is a restrict order i. e. an specifying the max. /min. rice at which he/she is prepared to purchase /sale, or at a market value i. e. with none restrict of value. The acquisition and sale orders are legitimate for seven and ten days respectively, if not revalidated / cancelled in any other case by the account operator. Withdrawal of Securities/Funds All or any quantity of fund or securities could also be withdrawn from an account topic to retaining of minimal credit score steadiness of Tk. 5000. 00 in money or in securities to maintain the account operating alive. Utility in opposition to IPO All actions regarding software for securities and assortment of allotment letter / refund warrant and certificates, as the case could also be, in opposition to the IPO[8] are achieved by ICB on behalf of account holder.
Assortment of Securities and Advantages Proper shares, bonus shares, dividends, curiosity, transformed shares and so forth. accruing to an account are collected by ICB from the respective corporations. Registration and custodial companies Registration of shares/ securities with the firm is made earlier than the closure of the firm’s share / debenture switch ebook, after finishing all the required formalities, on behalf of the account holder. Volt and different custodial association for property of the account are offered by ICB. Counseling and knowledge Help In order to develop diversified and balanced portfolio to reduce threat and maximize revenue, ICB gives skilled recommendation to its shoppers.
Knowledge Help in the type of securities Assessment sheet, each day buy/ sale place, assertion and portfolio of every account, and so forth. are offered on demand and on common interval. Earnings Incomes from investments by means of dividend, curiosity, bonus shares, capital positive aspects and so forth. are credited to the respective account. Expense Curiosity on mortgage (currently-12. 5%) and brokerage (zero. 5% for non CDS & zero. 5250% for CDS) on sale/ buy of securities are charged to the respective account. To encourage the small and medium savers, ICB at current doesn’t cost charges for many of the companies rendered by ICB to its clients, together with charges for administration, funding recommendation, custodial service(for non CDS securities),and so forth. Closing of Account
An account could also be closed by written order topic to settlement of charges & dues, if any. There is no such thing as a provision of revival of a closed account. Threat Administration Dangers of investments in the securities market are minimized by way of prudent & skilled portfolio administration. 2. 11 Group Construction of ICB Administration of ICB The top workplace of the company as per the requirement of the ordinance of ICB is positioned at Dhaka. The board of administrators of ICB could be very a lot wealthy because it consists of distinguished skilled and managing director of different group. The Board consists of 11 members together with the Chairman and Managing Director. The Board of Administrators consists of the following members. The Chairman and Managing Director (MD) are to be appointed by the authorities o The administrators to be appointed by the authorities from amongst individuals serving underneath the authorities. o One Director to be appointed by the Bangladesh Financial institution o The Managing Director of Bangladesh Shilpa Financial institution (BSB), ex workplace. o The Managing Director of Bangladesh Shilpa Rin Shnagsta (BSRS) o 4 different administrators to be elected by the shareholders apart from the authorities. ICB- its Divisions and Departments Funding Company of Bangladesh break up, into 25 departments and 11 divisions in its head workplace. Beside that ICB has seven branches in several districts. These are located at Dhaka (native workplace), Chittagong, Sylhet, Rajshahi, Khulna, Bogura and Barisal. ICB is functionally divided into two broad wings.
One is operations wing and one other is Administrative wing. The features of operational wings contain the actions of mission Financing, Planning Analysis and Enterprise Development, Lunching Unit and Mutual Funds (launching if new funds is now stopped and presently the perform is achieved by ICB Asset Administration Ltd), transaction and upkeep of Investor Accounts. The perform of administrative Wing contain the actions of Account and Finance, Authorized affairs, Implementation and Restoration, Venture Implementation, Regulation and Public Concern. It’s talked about earlier, that ICB consists of 11 Divisions and 25 departments. The next desk lists all the divisions and departments of ICB.
An appendix at the pf the report accommodates the full Organ gram of ICB. Desk 2. four |Division |Division | |A. Administration |01. Personel | | |02. Institution | |B. Mortgage Appraisal |03. Mortgage Appraisal | | |04.
Financial and Enterprise Analysis | | |05. Securities Assessment | |C. Authorized Affairs |06. Public Concern | | |07. Regulation | |D. Merchandising |08. Traders’ | | |09.
Shares | | |10. Transaction | |E. Funds |11. Unit gross sales | | |12. Unit Registration and Procurement | | |13. Mutual Funds | |F. Pc |14. System Assessment | | |15.
Programming | | |16. Administration Info System | |G. Audit And Strategies |17. Audit And Strategies (Head Workplace) | | |18. Audit And Strategies (Branches) | |H. Accounts and Finance |19. Central Accounts | | |20.
Venture Mortgage Accounts | |I. Implementation |21. mission Implementation | | |22. Restoration and Comply with-up | |J. Secretary’s |23. Secretary’s | | |24. Public Relation | |Ok. Department and Subsidiaries management Division |25.
Department Management Division | 2. 11 ICB Mutual Funds It’s a acknowledged precept that diversification of funding reduces threat. A person might not have the time, experience and assets to undertake such diversification. Right here arises the benefit of a Mutual Fund. Mutual Funds pool the financial savings of an amazing quantity of buyers and make investments in a big selection of securities. In Bangladesh ICB has pioneered Mutual Funds for the sake of buyers and of the capital market. Mutual Funds are often known as shut ended Mutual Funds. The issued capital of a Mutual Fund is proscribed, that’s, a Mutual Fund affords a restricted quantity of certificates on the market to the public.
The quantity of capital and the quantity of certificates of every Mutual Fund stays unchanged. ICB Mutual Funds are unbiased of each other. Value of Mutual Fund certificates after IPO is set on the Inventory Exchanges by way of interplay of provide and demand. The market value of a Mutual Fund certificates is obtainable in Inventory change quotations and in newspapers. An investor can buy any of the present eight ICB Mutual Funds certificates by way of the Inventory Exchanges at the prevailing Market Value. The Mutual Funds are managed by ICB as fund supervisor for which receives fee @1%. ICB Mutual Funds Certificates holders shall have unfettered possession in the property of the Fund to which they’re associated.
In case of winding up of the Company the property belonging to any ICB Mutual Fund shall not be handled as the property of the Company. At current administration payment @ 1% on the paid up capital of the Fund is charged yearly. No quantity is charged on account of custodial and belief companies. The online revenue obtained on investments of Funds on account of dividend, bonus, curiosity, capital acquire and so forth. are distributed amongst the Certificates Holders as per determination of the Board of Administrators of ICB. Board declares such revenue in the type of dividend at the finish of July annually. Dividends declared by ICB in the previous on the Mutual Funds had been very engaging.
A element Assessment on ICB sponsored mutual fund will probably be adopted on the second half of the report. 2. 12 ICB Unit Fund Sponsored by the Authorities of Bangladesh, ICB Unit Fund was established on April 10, 1981. Its essential goal is to mobilize financial savings by way of sale of its models to small buyers and make investments these funds in marketable securities. The scheme gives a possible supply of fairness and debt to industrial and business considerations and thus contributes to the industrial improvement of the nation. Unit fund is an open ended Mutual Fund. It gives a chance to the unit holders to take a position their funds in a nicely managed and diversified portfolio with a excessive diploma of safety of capital and cheap yearly returns.
Funding in Items is protected and ensures a steady and common supply of revenue for the holders. Items are simply encashable. As such, funding in Unit is relatively extra engaging. By investing on this scheme an investor might derive private profit on the one hand and in addition contribute in direction of the financial improvement of the nation on the different. ICB models are securities inside the that means of Belief Act. 1882. Concern, Switch and Give up of Unit Certificates (I) Items can be found in 1, 5, 10, 50, 100, 500, 1000, & 5000 denominations. The names with addresses of the holders are recorded and dividends are dispatched to them accorded and dividends are dispatched to them accordingly. II) Items could also be transferred by way of prescribed switch type duly stuffed in and signed by the transferor and transferee. No stamp obligation is required for such transfers. (III) Items could also be encased by means of surrendering the certificates together with the prescribed give up kinds duly stuffed in and signed by the registered holders and no prior discover is required. The certificates are required to be surrendered at the prevailing Repurchase Value. Value Fixation: Adjustments in repurchase costs of models are notified by way of the newspapers and value of a Unit is mounted periodically by ICB as its fund supervisor. Amongst others, valuation of the property of the Fund is considered whereas fixing value of a unit. Public Participation
The Fund is split into models that are commonly known as “ICB Unit”. Every Unit bears a sure worth in the property of the Fund. The Unit holders are the homeowners of the fund and solely they’re benefited from it. Unit certificates might be bought in single or joint identify (s). At current most of 10,00zero Items might be bought in a single or joint identify(S) at a time. Items are usually not bought to establishments. Skilled Counseling Skilled Counseling is rendered to the potential & present buyers who’re keen to buy ICB Items by way of ICB places of work and approved Financial institution branches. Presently this scheme is operated by ICB Asset Administration Firm Restricted. Funding by Bangladeshi Residents Overseas
The Bangladeshi residents dwelling overseas might spend money on certificates on success of the following phrases and circumstances: (I) The worth of Items bought is to be remitted by way of financial institution channel, (II) The cash invested in Items and advantages thereon are usually not allowed to be repatriated, (III) The buyers should point out their native and financial institution addresses in Bangladesh for comfort of registration of Items. Funding by Foreigners Residing in Bangladesh The overseas nationals residing in Bangladesh can also spend money on Unit Certificates, offered they produce certificates to the impact that cash being invested are their very own financial savings and isn’t borrowed as mortgage or overdraft from any financial institution. These certificates are to be collected from a Gazetted Officer or a Banker not beneath the rank or Deputy Normal Supervisor. Fund Administration
The accountability of managing the fund rests on ICB for which administration payment @ Tk. 1. 25 per Unit (web excellent) is charged. The Company additionally discharges the accountability of loading and unloading of securities in and from the portfolio in the curiosity of the Unit holders. It’s also the custodian of all property of the fund. Dividend The entire revenue earned on funding/ deployment of funds, web of expenditures incurred, in a monetary yr is distributed amongst the unit holders as dividend. Dividend is often declared at the finish of July annually by the Board of Administrators of ICB. Dividend Warrants are dispatched quickly after declaration of dividend.
Since launching of the scheme in 1981 until FY 2004-05 the charges of yearly dividend declared/ paid are as underneath: Determine 2. four: dividend efficiency of ICB unit fund The graph exhibits that the fund gives a horny money dividend annually to the highest of 25% in 1988-89 and to the lowest of 11. 01% in 2004-2005. Determine 2. 5: Dividend yield on ICB unit fund The graph exhibits a dividend yield on opening value of the unit fund. Tax Advantages (I) Funding in Items enjoys the profit of Funding Allowance underneath Sec. 44 of Earnings Tax ordinance 1984. (II) Items are handled as authorized securities in accordance with the Part 2993 of the Corporations Act. 1994 and Insurance coverage Act,  1938. These are additionally handled as Securities as per Sec. 20 of the Belief Act, 1882. Cumulative Funding Plan (CIP) Below this scheme a holder as a substitute of receiving dividend might reinvest such dividend revenue accrued for buying Unit at a confessional price. In such case, Items are issued at Tk. 1. 00 lower than the opening value of the monetary yr. 2. 13 Development Actions of ICB Fairness Help by way of consortium association ICB inve

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