Submitted To
Kazi Nafiul Mazid
Advocate, Supreme Court of Bangladesh
Submitted By
Meherabul Islam Shovon
Northern University Bangladesh
Learning Objects
Definition of Banking.
Evolution of Banking.
Beginning of banks.
Modern Banking.
History of Banking in Bangladesh.
Bangladesh Bank.
Types of Bank in Bangladesh.
Commercial Bank.
CAMELS Rating System.
Definition of Banking
The word Bank come from the Latin Word “Banco”.
The term banking is defined as “accepting, for the purpose of
lending or investment, of deposits of money from the public,
repayable on demand or otherwise and withdrawable by
cheque, draft, and order or otherwise”.
It is thus clear that the underline principle of business of
banking is that the resources mobilized through the
acceptance of deposits must constitute the main stream of
funds which are to be utilized for lending and investment
purposes. The banker is thus an intermediary and deals with
money belonging to the public.
The Evolution Of Banking
Beginning of Banks
The idea of banks began as long ago as 1,800 BC in
Babylon. In those days moneylenders made loans to
people. In Greece and Rome banks made loans and
accepted deposits. They also changed money. (In the
Bible Jesus famously drove the money changers out of
the temple in Jerusalem).
However with the collapse of the Roman Empire trade
slumped and banks temporarily vanished. However
banking began to revive again in the 12th and 13th
centuries in the Italian towns of Florence and Genoa.
History of Banking in Bangladesh
The first modern bank in Bengal was Bank of
Hindostan, established in 1770 in Calcutta.
The first modern bank headquartered
in Dhaka was Dacca Bank, established in 1846. It
did a very limited business and did not issue
banknotes. It was purchased by Bank of Bengal
in 1862.
• After the Liberation Warandthe eventual
independenceof Bangladesh, the Government of
Bangladesh reorganized the Dhaka branchof
the State Bank of Pakistan as the central
bank of the country, namingit Bangladesh
Bank. This reorganization was done pursuant
to Bangladesh Bank Order, 1972, andthe
Bangladesh Bank cameinto existence
retroactively from16 December1971.
Nationalized Commercial
Banks (NCBs) wereestablished
in Bangladesh in 1972 through
amalgamation of twelve
commercial banks that were
operating in pre-independent
Bangladesh allowing the poor
access to fund, reducingcapital
flight to foreign countries, and
increasing domestic investment
weresome of the basic
objective of this
Bangladesh Bank
Bangladesh Bank is the central bank of Bangladesh.
Bangladesh Bank was established in Dhaka as a body
corporate vide the Bangladesh Bank Order, 1972 (P.O. No.
127 of 1972) with effect from 16 December 1971. At present
it has ten offices located at Motijheel, Sadarghat,
Chittagong, Khulna, Bogra, Rajshahi, Sylhet, Barisal,
Rangpur and Mymensingh in Bangladesh; total manpower
stood at 5807 (officials 3981, subordinate staff 1826) as of 31
March 2015. Bangladesh Bank is the first central bank in the
world to introduce a dedicated hotline (16236) for the
general populace to complain any banking related problem.
Moreover, the organization is the first central bank in the
world to issue a "Green Banking Policy".
Functions of Bangladesh Bank
 The major functional areas include :
Formulation and implementation of monetary and credit
Regulation and supervision of banks and non-bank financial
institutions, promotion and development of domestic financial
Management of the country's international reserves.
Issuance of currency notes.
Regulation and supervision of the payment system.
Acting as banker to the government .
Money laundering prevention.
Collection and furnishing of credit information.
Implementation of the Foreign Exchange Regulation Act.
Managing a deposit insurance scheme .
Types of Bank in Bangladesh
Commercial Bank
A commercial bank is a
financial institution that
provides services, such as
accepting deposits, giving
business loans and auto
loans, mortgage lending,
and basic investment
products like savings
accounts and certificates of
The traditional commercial
bank is a brick and mortar
institution with tellers, safe
deposit boxes, vaults and
Types of Commercial Bank
Functions of Commercial Bank
Role of Commercial Banks in 21st century
 The commercial banks are now not confined to local
 They are fast changing into global banking i.e.,
understanding the global customer, using latest
information technology, competing in the open market
with high technology system, changing from domestic
banking to investment banking etc.
 The commercial bank are now considered the nerve
system of all economic development in the country.
CAMELS Rating System
 Meaning of CAMELS Rating System
 C = Capital adequacy.
 A = Assets.
 M = Management Capability.
 E = Earning.
 L = Liquidity.
 S = Sensitivity.
CAMELS Rating as of December 2014
Strong or ‘A-class’ Banks
Prime Bank.
Exim Bank.
South Bangla Agriculture Bank.
Southeast Bank.
Standard Bank.
Satisfactory or ‘B-class’ Banks
Al-Arafah Islami Bank.
Islami Bank Bangladesh.
Dutch-Bangla Bank.
Bank Asia.
AB Bank.
Mutual Trust Bank.
Pubali Bank.
Dhaka Bank.
Uttara Bank.
Shahjalal Islami Bank.
One Bank.
NCC Bank.
Jamuna Bank.
The Trust Bank.
Social Islami Bank.
BRAC Bank.
Union Bank.
Midland Bank.
NRB Global Bank.
Modhumoti Bank.
NRBC Bank.
Farmers Bank.
NRB Bank.
Meghna Bank.
Premier Bank.
First Security Islami Bank.
Eastern Bank.
Fair or ‘C-class’ Banks
 Mercantile Bank
 National Bank
 IFIC Bank
 The City Bank
 United Commercial Bank
 Bangladesh Commerce Bank
 Bangladesh Development Bank
 Bank Al-Falah
 Woori Bank
Marginal or ‘D-class’
Unsatisfactory or ‘Eclass’ Banks
Rupali Bank
Agrani Bank
Janata Bank
Sonali Bank
Bangladesh Krishi Bank
Rajshahi Krishi Unnayan
ICB Islamic Bank
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