Subject: Submission of the Practice Report on "Financial Performance Analysis of First Security Islami Bank Limited.". It gives me great pleasure to present to you my report on "Financial Performance Analysis of First Security Islami Bank Limited" as a partial requirement of my BBA program which included a three-month internship. I declare that the internship report on "Financial Performance Analysis of First Security Islami Bank Limited", which I submitted to Daffodil International University as part of the application for the Bachelor of Business Administration degree, is a unique work.
This is to certify that the internship report titled "Financial Performance Analysis of First Security Islami Bank Limited" is a genuine work done by Rawnak Raian Mahmud, ID Head of Accounting, Department of Business Administration, Daffodil International University. I would like to express it. my thanks to Saleh Ahammad, AVP & Manager, First Security Islami Bank Limited's Ring Road Branch. As a reputed commercial bank of the country, First Security Islami Bank Limited was established on 29 August 1999 and Bangladesh Bank gave the permission to start their exercise on 22 September 1999.
The First Security Islami Bank Limited Bank follows accurately in accordance with "Islamic Shariah" principles. First Security Islami Bank also undertakes more than a few common good activities through its subsidiary organizations.
Origin of the Report 2
First Security Islami Bank (FSIBL) is a specialized financial institution that performs the most with respect to the standard banking services and investment things to do such as through the profit-loss distribution determination, which is mainly based on the principles regarding Islamic Sharia. Besides the bank also participates between the financing of the long-term initiatives that are entirely based on the principles on profit-loss distribution or no longer by granting interest-bearing credit facilities.
Objectives of the study: 3
Scope of the study 3
Sources of data collection 3
Data Analysis 4
Limitations of the Report 4
It started its journey on August 29, 1999 with its first department in the Dilkush commercial area of Dhaka. FSIBL is the first private bank to establish an agency association including Western Union to facilitate fast and reliable passage of remittances and valuable overseas exchanges earned by expatriate Bangladeshis. It is also the precursor personal financial institution to the worldwide Master Card in Bangladesh.
FSIBL is the prominent private bank of Bangladesh region offering wide reach in personal, corporate, foreign exchange, international trade, lease financing and capital market services. FSIBL Inter Bank is desired through customers because its pleasant and personalized services, reduction of parts technology, options tailored to the needs of commercial enterprises, international scope of profession and trade or huge investment growth, guaranteeing the grace of Banking Services.
Vision of First Security Islami Bank Limited 6
Mission of First Security Islami Bank Limited 6
Objectives of First Security Islami Bank Limited 7
Strategies of FSIBL 7
Organizational Structure of FSIBL 8
The Board of Directors 9
Products of FSIBL 12
The values used to calculate a company's financial ratios are taken from the financial statements of that same company. Determine the numerical or quantitative relationship between two numbers in the financial statements to determine the company's strengths, weaknesses, current financial status, and past performance. Ratios are efficient means of communication and play an important role in informing owners or other parties about the state of affairs and its development.
They want to know whether the company will meet its creditors' short- and long-term obligations, as well as ensure a fair return to its shareholders and the most efficient use of the company's properties. Financial statements, on the other hand, have a series of flaws that will affect the accuracy of the company's financial statements. Therefore, it is useless to forecast the long-term data for the company for further information.
For example, during this time of year, an umbrella company maintains a high inventory level, but during the rest of the year, its inventory level drops to 25% of the seasonal inventory level. In general, the greater the assessment of the ratio, the greater the rand well-being the company has to cover financial obligations. Positive net working capital therefore represents the ability of the business to deliver far beyond its obligations. If working capital is negative, which usually shows so much that the company can incur a significant cash outlay or an enormous increase in its debt. end result about a substantial purchase of products then appears at its suppliers.
In 2015, the company had the lowest net working capital, and in 2019 the highest net working capital. With these calculations, we can ensure that the company will easily repay its creditors and generate a healthy profit for the shareholders. Earnings per share (EPS) is the proportion of a company's net profit distributed over each share of equity capital issued.
Earnings per share is a perfectly useful indicator of the profitability of some organizations, but then it is one of the most ancient measures of profitability. A company's P/E ratio is a way of measuring whether a stock's value is high or low as opposed to mimicking its predecessors or in line with other companies. Earnings per share is calculated by dividing earnings for the past 12 months by a large spread in relation to common shares outstanding.
From the graph, we see that FSIBL had the highest market value of the stock compared to its earnings in 2017. But FSIBL uses its investor funding more than its creditor funding because most of the ratios are less than 50. After considering a few factors, it is reasonable to conclude that First Security Islami Bank Limited had a decent year in 2019, with the majority of the ratio showing favorable results.
More products of various interests should be introduced to meet the needs of the diverse customer group.
Key features of Banking Service 13
Advantages of Ratio Analysis: 16
Ratio analysis determines the degree of efficiency in the control and use of a company's properties. Ratios can be used to monitor the performance of various divisions or departments within an organization, as well as to keep track of costs. In situations such as whether products should be sold on credit to a company or not, whether bank loans will be made available or not, and so on.
Limitations of Ratio Analysis: 17
Key figures are only used for quantitative analysis, and qualitative considerations are not taken into account when calculating key figures. From the above graph we can say that FSIBL has a quiet stable current ratio over five years. But these five-year ratios are higher than the standard called industry average, which should be higher than 1.
Net working capital is defined as the difference between a company's current assets and current liabilities. Here we can see that the net working capital is increasing year on year which shows that the good liquidity position of FSIBL. Profitability ratios are established regarding measurements used to determine a company's ability to distribute earnings.
These ratios are viewed with prejudice, so if they improve above a trend line, they are relatively better than the effects of competitors. Profitability ratios are derived in addition to an assessment of income in imitation of difference groupings regarding costs in the income statement. This five year forecast shows that the bank has improved its net income quietly over these 5 years.
From the above graph, FSIBL is facing fluctuating returns over the five years. Current ROI shows that the bank has the ability to earn a profitable return on a particular investment. Solvency ratios are any type of financial ratio evaluation that measures the long-term health of a business.
Debt to equity is a financial, liquidity ratio to this amount compares a company's total debt to total equity. Earnings per share (EPS) in 2019 was higher than other years ratio which was 2.38, very reasonable for a commercial bank and in 2015 EPS was 1.18 which was lower than other four years. Since most satisfied customers recommend the bank in line with friends and family, the bank needs to keep extra focus on the current customers in the system in line with constructing strong affinity and increasing loyalty.
The bank should adopt a new marketing strategy that will respond and take effective measures to increase trust in them. Instead of blaming other factors for the setback, the bank should recognize them and use them as a target to achieve future goals.
Ratio analysis of JBL from (2015-2019) 18-30
Recommendations 31
Conclusions 32
