Rajshahi Krishi Unnayan Bank

Rajshahi Krishi Unnayan Bank (RAKUB) the largest development partner in agricultural finance in the Rajshahi and Rangpur Division (northwest of Bangladesh). As per the Presidential Ordinance No 58, 1986, the bank was established on 15 March 1987 by taking over of all offices, branches, and other establishments of Bangladesh Krishi Bank (BKB) in Rajshahi division, including their assets and liabilities. As the largest development partner in the northwest region RAKUB aims at overall development of farmers and all the sectors and sub-sectors of agriculture in this region. The bank also performs like financing in agri-business and agro-based industries and poverty alleviation programmes. The bank is also given finances for production of all the summer and winter crops, horticulture and nursery etc. Particularly high yielding, high price crops and seeds production is also encouraged. The bank also extends credit facilities for systematic and commercial livestock farming, which includes dairy, beef fattening, poultry, raising and setting up of hatcheries.

At present, the bank is operating its all services through 367 branches through out the country. Among them the number of rural branches is 304. The headquarters of the bank is located at Rajshahi city, some 270 km to the north of Dhaka. The bank has two divisional offices and two divisional audit offices in Rajshahi and Rangpur. Merely a training institute of the bank is situated at Rajshahi city.

The management of RAKUB is vested in a 9-member board of directors including the chairman and the managing director appointed by the government. An executive committee is consists of 3-member of board of directors' makes policy during emergency period. An executive officer is chief of managing director of the bank.

Indicators	2004	2005	2006	2007	2008	2009
Authorised capital	1500	1500	1800	1800	2200	7500
Paid up capital	1500	1500	1800	1800	2200	5700
Reserved Fund	208	208	208	208	208	208
Deposits	10930	12848	12705		6990	1722
(a) Call Deposits	1876	5364	8199	1505	1705	1722
(b) Term Deposits	9054	6214	4649	12453	5285	-
Loans and Advance	18327	21428	24713	25906	25578	27338
Investment	3437	3450	42	42	52	46
Total Asset	27989	30385	33915	34610	37651	42227
Total income	1756	1603	1736	1940	1975	2047
Total Expenditure	1708	1970	2157	2356	2616	2110
Foreign Currency Trading	74	197	74	73	-	-
a) Export	-	-	-	-	-	-
b) Import	51	132	-	-	-	-
c) Remittance	23	65	74	73	-	-
Total Manpower:	3577	3524	3446	3441	3448	3464
a) Officers	1607	1570	1514	1506	1419	1545
b) Staff	1970	1954	1932	1935	2029	1919
Correspondents Banks	-	-	-	-	-	-
Total Branches (in numbers)	349	353	357	364	364	364
a) Domestic	349	353	357	364	364	364
b) Overseas	-	-	-	-	-	-
Agriculture Credit:
Loan Disbursed	4273	5013	4462	3954	3565	4710
Realised	3871	5106	4153	4644	3757	4815
Industrial Credit:
Loan Disbursed	709	1307	1724	2129	2162	2408
Realsied	470	684	997	2604	2525	2756
Loan Outstanding by Sector
Agriculture and Fisheries	12031	13926	15378	15911	16603	17930
Industry	2129	2407	2773	2821	2832	2518
Trade and Commerce	1118	-	-	18	17	18
Poverty Reduction	554	677	707	791	844	962

Source Government of Bangladesh, Ministry of Finance, Banking and Financial Institution Division, Bank o Arthik Prothisthan Samuher Karjaboli [Annual Report on Banks and Financial Institutions], 2004-05 to 2009-10.

The bank distributes 60% of the lending budget in the crop production sector and the remaining portion allocate to the northwestern region of the country for the same purpose. The bank identified potential 7 sectors and agri-based 101 sub-sectors and takes initiative to disburse loan for entrepreneurs improvement of those area. An 'Entrepreneurs Development Cell' has been formed in the principal branch aimed to provide advice and inclusive assistance to entrepreneurs, who want to establish new project and construct former project. There is also a 'credit committee' in every zonal office for given swiftly advice and assistance to the intent entrepreneurs.

The bank has enforced newly 'credit policies 2005' to obstruct the flow of centralised lend in one sector, the bank creates multifarious lending system and diversification in loan, substitute of importing goods increase production of agricultural yielding, to expand agri-based industry, to boost more loan in small and medium scale than that of big amount and long-term loan.

The bank operating a few projects named with 'poverty reduction loan programmes' to generate job opportunity for the educated and less educated unemployed youths and landless poor people of the Rajshahi region. The bank distributes loan individually and collectively under such projects to improve lifestyle and socio-economy condition of the poor people. The bank conducts various security free loan included goat breeding programmes, marginal and small farm based yielding project, RKUB self-dependent credit programme, self-sufficient credit programme, Women entrepreneurs advance loan project, loan programme for handicapped people, loan programme for establishing nursery or garden of medicinal plants, grain stored loan project and special loan programme for poverty evacuation. Moreover, the bank also inaugurates 'consumer credit project' and 'infrequent loan for employees'.

RKUB functioning two types loan programmes with the assistance of foreign aid including, 1. SEDCP (Small Enterprises Development Credit Project) and 2. NCDP (Northwest Crop Diversification Project). Under these projects, the bank starts agriculture loan distribution activities to the intent peasants in different districts for establishing new small project providing necessary training, to improve of old project, launched new trade and stopping old business, to produce of high worthy harvest, to establish agrarian project and to improve the trade of agro-products. As per the government rules the interest rate of agricultural loan is between 8%-10%.

Besides, the current lending sectors, the bank disburses loan interested 2% in importing substituted 19 agro-products including different pulses, seed oils, spices related harvest and maze.

The bank implemented profitably a reforms programme Five Years Plan (01.11.1999-31.10.2004), MIRACLE is the notable part of the programme. Due to successfully implementation of the programme, the bank returned interest Tk 21 million and Tk 24 million in the FY of 1999-2000 and 2000-01 respectively. The bank executing a long-term plan called Rakub Respective Plan 2001-10. The bank operates MBO (Management By Object), PARL (Participation of All for Recovery of total Loans), BUP (Bottom Up Planning) and Ges Participatory Management system for fast-moving activities.

Deposit raising is identified as the important second source of funding of the bank to generate sustainable investment. About 304 branches (84%) of union level are collecting deposits. Rakub offers few attractive deposit schemes include Rakub Hajj Savings Account, Rakub Education Savings Project, Rakub Rural Pension Savings Project and Rakub Children's Marriage Savings Project.

Development of info-technology and customer service the bank has a separate computer division under the authorised organising structure aiming to expand of info-technologies improvement. It has already drawn up Perspective ICT Plan 2006-2011 for generating computerised transaction and customer services in 364 branches of the bank in the FY of 2010-11. The bank supplied computer in 18 zonal offices, divisional office of Rangpur and all departments of Head Office and started communication and tranformation of information with field level offices through e-mail. Head office of the bank is connected with Local Area Network (LAN). The bank supplied auto-computed machine and fake note identification machine in the branches of district, upazila and union level. [Muhammad Abdul Mazid]