Loan disbursement of IFIC Bank home loan

Abstract

Banking system of Bangladesh has through three phases of development Nationalization, Privatization and lastly Financial Sector Reform. IFIC Bank Limited has started its journey as a private commercial bank on June 24, 1983.As a part of my under graduation program, I have completed my internship in this organization. During the period of my internship, I was officially appointed to work in the credit risk department. The report will reveal the background of the company, description of the loans, findings and recommendations based on the gathering of experience. The report is based on my critical observation while working in the credit risk department of IFIC Bank Ltd. Lending is one of the principal functions of the bank to ensure all the segment of a bank. Sound lending practice is also very important for profitability and success of a bank. For the sake of sound lending, it is necessary to develop a sound policy and modern credit management techniques to ensure that loans/ advances are safe and the money will come back within the time set for repayment. For this purpose, proper and prior analysis of credit proposals is required to assess the risk. Loan procedure of a bank is really difficult to do because there are some criteria which have to follow step by step for sanctioning a house building loan e.g. selection of a borrower, how much loan is providing, security and also approval process . It is a tough job for a banker to get through all the criteria and it is risky for them and also for the bank. The comparative analysis shows that IFIC is in better position, but there are some obstacles it faces to sustain the position. However, the continuous improvement of the services will certainly place the bank in the best position in one decade. Bank credit is an important means for bringing about economic development in a country. IFIC Bank Limited, being one of the private commercial bank of the country, has some prejudice to finance directly on priority basis to agriculture, industry and commerce sector. Hence, it is very clear that IFIC Bank plays an important role to move the economic wheel of the country.