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Islami Bank Bangladesh Limited


Islami Bank Bangladesh Limited (IBBL) the first interest-free Islamic Shariah based bank in Bangladesh incorporated on 13 March 1983 as a public limited company under the Companies Act 1913. The bank obtained license from bangladesh bank on 28 March 1983 and started banking operations on 30 March 1983 through its main branch at Dhaka, which was formally inaugurated later, on 12 August 1983. The bank is a joint-venture enterprise of 22 private sponsors of Bangladesh, the government of Bangladesh, Islamic Development Bank, and 13 banks and financial institutions of the Middle Eastern Muslim countries.

Foreign sponsors as the Islamic Development Bank (IDB) and some other financial institutions own 59.58% shares, while 40.42% shares are owned by local sponsors and the general public. On 31 December 2009 the amount of the authorised and paid-up capital and reserve fund stood at Tk 10000 million, Tk 6178 million and Tk 13928 million respectively. The bank is listed with both Dhaka and Chittagong Stock Exchange.

Table  Basic facts and economic indicators (in million Taka)

Indicators 2004 2005 2006 2007 2008 2009
Authorised Capital 3000 5000 5000 5000 10000 10000
Paid Up Capital 2304 2765 3456 3802 4752 6178
Reserved Fund 4522 5451 6551 7418 9308 13928
Deposits 87721 107788 132419 166325 200343 244292
a) Call Deposits 9578 17454 17731 24225 27642 30492
b) Term Deposits 78143 90334 144688 142100 172701 213800
Loans And Advance 76826 93644 113575 144921 191230 173096
Investment 3536 3534 3558 20366 7533 11137
Total Asset 102128 122880 150253 191362 230879 278302
Total Income 8400 10587 14038 17699 24230 25404
Total Expenditure 7175 8424 11130 13918 17396 18886
Foreign Currency Trading 112624 147642 201822 229503 402695 462370
a) Export 29151 36169 51133 59097 93962 106424
b) Import 59804 74525 96870 103293 168329 161230
c) Remittance 23669 36948 53819 67113 140404 194716
Total Manpower 4261 5884 7133 8083 9397 9588
a) Officers 3327 4854 5894 6711 5341 5930
b) Staff 934 1030 1239 1372 4056 3658
Correspondent Banks 235 240 240 884 906 919
Total Branches (In Numbers) 151 169 176 186 196 231
a) Domestic 151 169 176 186 196 231
b) Overseas - - - -
Agriculture Credit
a) Loan Disbursed 18 17 19 23 30 3106
b) Realised 9 7 10 13 20 1889
Industrial Credit
a) Loan Disbursed 32153 46799 57065 74489 100545 152028
b) Realsied 36812 52039 41702 59400 81127 120809
Loan Outstanding By Sector
a) Agriculture And Fisheries 1901 2134 3412 3427 3097 3238
b) Industry 17095 46064 27936 28203 53511 49088
c) Trade And Commerce 27934 29874 31807 69568 61887 7476
d) Poverty Reduction 2704 1106 2242 2301 3012 2050

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.

IBBL conducts businesses on the principles of Mudaraba, Musharaka, Hire Purchase (under Shirkatul Meelk), Bai-Murabaha, Bai-Muajjl and Bai-Salam. The bank also provides all other commercial banking services to the customers observing the provisions of the Bank Company Act 1991, Bangladesh Bank's directives and the principles of Islamic Shariah. Deposit-mix included Mudaraba savings deposits, Mudaraba special notice deposits, Mudaraba term deposits ranging from 6 months to 36 months, Mudaraba Hajj savings deposits, Mudaraba special savings (pension) deposits and Mudaraba savings bond of 5 and 8 years.

A 23-member board of directors oversees the aggregate business affairs of the bank. The executive president is its chief executive officer. In December 2009, the bank had 196 branches and a total of 9,397 employees including 5341 officers. There is a 10-member Shariah Council for the bank to ensure the compliance of Islamic rules in all spheres of its banking and financial activities. The investments (lending) of the bank are partnerships, profit sharing, capital in affiliated projects, real estates, housing, transport, agriculture, export-imports, trade and commerce and other economic activities.

According to CAMEL (Capital, Assets, Management, Earnings and Liquidity) rating made by the Bangladesh Bank the bank holds the highest amount of liquidity. The Global Finance, a reputed London based quarterly magazine awarded IBBL as the best bank of the country for the year 1999 and 2000. IBBL has got the 2nd prize of National Export Fare for its pavilion of Service Organisation in 1985. [Muhammad Abdul Mazid]